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China Detains Local Staffer Handling Rare Metals at Japan Trader

TOKYO — A Japanese trading company’s Chinese employee overseeing rare metals in China was taken into custody by Chinese authorities earlier this year, according to sources familiar with bilateral relations.

The reason for the person’s detention in March is unknown. But with China tightening its control over rare metals, the person may be suspected of leaking information.

A Chinese employee of a Chinese state-owned nonferrous-metals company with reported business ties with the trading house is also believed to have been taken into custody at the time. Both were said to be in charge of trading in rare metals.

The Japanese trading company specializes in nonferrous metals, including rare-earth metals, and sells them to Japanese electronic components manufacturers and other clients. The Chinese company is a major developer, processor and seller of natural resources.

As U.S.-China tensions escalate, Chinese authorities are increasingly wary of espionage and information leaks, with an emphasis on economic security. A Japanese executive at an Astellas Pharma unit was taken into custody in March on suspicion of violating an anti-spying law, followed by an arrest on espionage charges in October.

According to media reports, Chinese nationals working in the Beijing office of U.S. due-diligence provider Mintz Group were detained in March. In April, Chinese authorities reportedly interrogated staff at the Shanghai office of major American consulting firm Bain & Co.

China’s revised anti-spying law took effect in July, with its broadened scope paving the way for the authorities to crack down on suspected cases of information sharing and collection that affect national security and interests.

The Chinese government is strengthening its control over rare metals, including rare earths, as a strategic resource crucial to national security and international competitiveness. Such metals are used in the production of electric vehicles and weapons. In addition to promoting the integration of major state-owned operators, China is tightening control over the mining and export of resources.

Source : Nikkei Asia