Aus businessman held in China

2010-11-26 09:01

Shanghai - An Australian entrepreneur is being detained in the southern Chinese city of Guangzhou in connection with a police investigation, his company says.

Travel services company Et-China, a joint venture partner with China Southern Airlines, said in a statement on its website on Friday that its chief executive officer, Matthew Ng, had been detained by police "as part of their investigations as a suspect of the crime of misappropriation of company assets."

"As far as Et-China is aware at present Matthew Ng has not been charged with any offense," it said.

The company's acting CEO, Chris Rose, urged authorities to resolve the matter and release Ng.

Police in Guangzhou did not immediately respond to phoned and faxed requests for comment on Friday.

Australia's Department of Foreign Affairs and Trade confirmed on Friday the detention on suspicion of embezzlement of a 44-year-old Australian man and long-time resident of China on November 16. It refused to release his name, citing privacy laws.

Australian news reports said the detention was related to a business dispute between Et-China, which has shares listed on the London Stock Exchange, and a local partner.

The case follows the arrest and subsequent conviction earlier this year of four employees of mining giant Rio Tinto for bribery and infringing trade secrets. The case raised worries over the vulnerability of employees of foreign companies to often selective enforcement of the country's vague state secrets and corruption laws.

Australian citizen Stern Hu, who at the time was in charge of Rio Tinto's troubled iron ore price negotiations with China was sentenced in April to 10 years in prison while three colleagues were imprisoned for seven to 14 years.

Ng's bio on his company's website says he has worked as an investment banker in Southeast Asia, Australia and New Zealand and was educated in New Zealand and Australia.

He founded Et-China in 2000 and launched another company, e-JV, with Guangzhou-based China Southern to provide the carrier's e-ticketing sales and services. The venture is due to run until April 2018.

The company has financial backing from major Australian businesses, according to Australian news reports.

The Australian newspaper The Age, said Ng was embroiled in a dispute with local company Guangdong Lingnan International Enterprise over control of an Et-China subsidiary, Guangzhou GZL International Travel Services.

Lingnan, a state-owned group that operates several prestigious Guangzhou hotels, opposed a planned acquisition of Et-China by Switzerland's Kuoni Group, the report said.

According to Et-China's website, GZL is 50.64% owned by Et-China and is one of the country's largest leisure tour operators.