Mechanism needed to guard trade secrets
The Rio Tinto case reminds us that China should strengthen its economic protection mechanism, says an article in Guangzhou Daily. Excerpt:
Four Rio Tinto employees were arrested on Tuesday on charges of stealing trade secrets and bribery.
The scandal involving Rio Tinto, an Anglo-Australian firm and the world's second largest iron ore producer, once again highlights the need for strengthening the mechanism to safeguard our trade secrets. We need a strong and proper legislation on safeguarding our business and trade secrets because its absence leaves ample room for multinationals to steal information. Some of these multinationals will not stop at even bribing officials to get trade secrets or key business information.
China failed to clinch a deal with Rio Tinto for the supply of iron ore earlier this year mainly because it didn't have enough information about the Australian firm - a situation not too uncommon with other companies. But foreign negotiators always have comprehensive knowledge of China's conditions and the companies they are dealing with.
The four arrested Rio Tinto employees obtained lots of information before the iron ore talks began with China. Information leaked by them over the past 6 years forced China to pay billions of dollars extra to import iron ore for its steel plants.
The spies for Rio Tinto didn't have to use any hi-tech gadget to steal the trade secrets. They simply visited steel plants across the country and talked with senior managerial staff to get key information on production and costs. They then wrote reports based on those information and sent them to their bosses abroad. It's a pity that few senior managers realized the need to protect their secrets.
China's laws on confidentiality and national security focus mostly on the conventional field of politics and overlook economic aspects. Although officials have cracked down upon Rio Tinto staff's spying activities, it doesn't mean China has already set up a systematic mechanism to crack down on economic spies.
(China Daily 08/14/2009 page9)
