AN AUSTRALIAN man is one of four Rio Tinto employees who have been arrested and detained by Chinese authorities, with the Rudd Government demanding Beijing provide "urgent consular access to him".
Rio's iron ore sales team was arrested by the Public Security Bureau in Shanghai, including the Australian passport holder, Stern Hu, and three Chinese passport holders. No explanation was given.
In what threatens to become a diplomatic nightmare, the Government said it is yet to make contact with the man. "They just failed to turn up to work on Monday and have disappeared," an Australian source said.
The arrests follow Chinese anger at Rio's decision to abandon a $US19.5 billion merger with China's state-owned Chinalco, and recent tension between the company and Chinese steel makers over the price of iron ore. There was speculation last night that the arrests could relate to manipulation of the iron ore market.
A spokesman from the Department of Foreign Affairs and Trade said the Government was aware the Australian man had been detained since Sunday but it was unclear about the reasons for his arrest. He said the man's family had been informed.
"The embassy in Beijing and the consulate-general in Shanghai are seeking urgent consular access to him."
It is understood Rio's iron ore team has been meeting in Hong Kong and Singapore for more than a month out of fears that their phones and emails were being bugged and that key negotiating information was finding its way back to the China Iron & Steel Association.
The talks, which were due to be settled by June 30, are continuing, with the Chinese steel makers demanding a bigger discount than the 33 per cent cut agreed to elsewhere in the world.