The Honourable Schoolboy – National Security in China and Arrests of Foreigners
The Asian Crime Century briefing 58
On 26 January a spokesman for the Ministry of Foreign Affairs of the People’s Republic of China (PRC) announced that Mr. Ian J. Stones, a 70 year old British businessman, was sentenced on 23 August 2022 by the Beijing No.2 Intermediate People's Court to five years imprisonment for “buying and unlawfully supplying intelligence for an organization or individual outside China”.
Ian Stones is the latest in a growing number of foreigners detained, charged, and imprisoned in the PRC for alleged espionage. However, what constitutes espionage is complicated as in the PRC “state secrets” are broadly defined and often include business information that in other countries would usually be available in the public domain.
Stones has a limited public profile for someone who has worked in the PRC since 1979 in market research roles. He reportedly is a partner at Navisino Partners Ltd, an investment management firm, and has prior experience at Sinomonitor Market Research, D.B. Zwirn & Co., Conference Board China, Pfizer and General Motors.
It has also been reported that Stones knew that he was under scrutiny by the PRC authorities and had even been invited for a “tea chat” with an agency that was tracking him. As part of his consulting work, Stones built relationships with Chinese government officials, which is an easy way to come under the scrutiny of the Ministry of State Security during their routine surveillance of foreigners.
Also in January, the PRC Ministry of State Security announced that they had arrested a foreign national surnamed ‘Huang’ who was the head of a consulting firm and had been working for the British Secret Intelligence Service since 2015. The MSS claimed that Huang was provided with training and espionage equipment, although no further details of the case have been released.
How national security charges may be contrived was illustrated in December 2018 when Canadians Michael Spavor and Michael Kovrig were detained by the PRC authorities, which came less than ten days after Ms. Meng Wanzhou, the chief financial officer of Huawei (and daughter of the company’s founder) was arrested in Canada in connection with an extradition request from the US authorities. Kovrig had worked for the International Crisis Group and Spavor for an organisation that promoted tourism in North Korea. In 2021 both were convicted during closed door trials in the PRC of providing state secrets to entities outside China, with Spavor sentenced to imprisonment. Both were released on the same day as the extradition request against Ms. Meng Wanzhou was withdrawn, which indicates how state secrets charges can be contrived in the PRC. In a twist to the saga, Spavor later claimed that Kovrig had passed information from him to the Canadian authorities, suggesting that Kovrig may have been an unwitting soure.
Sayonara Tokyo - Japanese Nationals detained in China
It is not only Westerners who can foul afoul of national security laws in the PRC. In November 2023, a court in the PRC reportedly dismissed an appeal by a Japanese man who had been convicted of national security related charges. The Japanese man, aged in his 50s and working in a nursing job in China, was detained in 2019 and in 2023 sentenced by a district court in Hunan Province to 12 years imprisonment.
In March 2023, a Japanese national who is a senior executive with Astellas Pharma (TYO: 4503), a major pharmaceutical company in Japan, was detained by the PRC authorities before being formally arrested on national security charges in October. He is one of five Japanese nationals detained in the PRC for alleged national security breaches, and there are reports that since 2014 17 Japanese nationals have been arrested for espionage.
Those arrested include Hideji Suzuki, director of a Japan-China youth exchange association, who was detained by Ministry of State Security officers in July 2016 when visiting China for symposium. In May 2017 he was charged with spying and after a trial sentenced to six years imprisonment. Suzuki claimed that his court appointed defence lawyer failed to defend him and that the charges against him were false. The case against Suzuki was that when he met a Chinese official in Beijing in December 2013 they had discussed North Korea, and the information discussed constituted espionage. An officer of the Beijing Municipal Public Security Bureau told Suzuki that news of the execution of Jang Song Thaek, the husband of the daughter of the late North Korean leader Kim Il Sung, constituted illegal information, which was the basis of the charges. The news of Jang's possible execution had in fact already been reported widely after an announcement by the South Korean government.
Although news media usually report such cases as “espionage”, it is important to frame them as “national security” allegations as the latter is a far wider range of potential infringements that go far beyond espionage and include normal business activities that could be construed by the PRC authorities as “national security” related because of their wide interpretation of state secrets.
Suspicious Minds – How to get arrested in China
The Ministry of State Security have helpfully published a very long list of how to get arrested in China for engaging in activities endangering state security. The activities are offences under the Criminal law of the PRC, State Security Law of the PRC, Counterespionage Law of the PRC.
They include activities that are commonly accepted in most countries as a threat to national security, such as colluding with foreign countries or with foreign institutions, organizations or individuals to endanger the sovereignty, territorial integrity and security of the PRC; organizing, plotting or committing activities to dismember the state; armed rebellion; and subversion of state power.
However, there are also more loosely defined national security threats such as defecting to the enemy (which could be construed as dual citizenship, even though this is not recognised in the PRCV). Also, stealing secretly gathering, buying or unlawfully providing state secrets or intelligence for institutions, organizations or individuals outside the territory can be a catch up offence (as state secrets are loosely defined this could catch people in business gathering legitimate information).
Espionage conduct is more straightforward, and includes an espionage organization or its agent, or by any other person under the instigation or financial support of an espionage organization or its agent, acting to endanger the state security of the PRC. However, if an accused person in China is working with an intelligence agent who is purporting to be engaged in business intelligence, then this is problematic and most likely leads to a presumption of guilt in the Chinese legal system.
Of greatest difficulty for those engaged in business and requiring business intelligence in China are offences of stealing, secretly gathering, buying or unlawfully providing state secrets or intelligence to an organisation inside or outside of the PRC. The necessity of business, trade and economic information regarding Chinese companies and investments requires a huge exchange of data, and this can easily fall foul of the national security laws.
Publishing information that could be construed as endangering state security and which fabricates or distorts facts is an offence, although in the PRC clearly “facts” are what the state dictates them to be. Business people are not likely to make use of religion to endanger national security (although a few people in business do like to go to church), and hopefully also are not likely to employ heretical cult organizations.
The offences include unlawfully holding documents, materials or other articles classified as state secrets, which is the key problem with national security laws in China. In China “state secrets” are defined as “matters that concern state security and national interests and, as determined according to statutory procedures”, and “not only include state policy decisions and secret matters relating to national defence, armed forces, state security, investigation of crimes, and foreign affairs, but also secret matters relating to the national economy, social development, science and technology, and anything that is classified by Chinese authorities specifically as a state secret.” In short, anything can be a state secret.
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There were news media reports in November 2023 that several consulting firms had advised employees to use “burner phones” when visiting the PRC, including when visiting Hong Kong. The purpose is to avoid compromise of corporate mobile phones which may lead to unauthorised access to data on the device or even to corporate networks, which could then compromise client data of these firms. This is prudent advice for executives traveling to many countries, but relies upon easy access to “burner phones” that have no corporate data and no access to the corporate networks.
However, traveling business executives should also consider their personal data. If a business executive is arrested in the PRC, their personal mobile phone as well as other computing devices will inevitably be seized and the owner compelled to open them to provide access to his or her cloud based data. Whilst corporate data can just about be ring fenced, personal data cannot. This means that any corporate data that has strayed on to personal devices (who has never sent a work email from their personal mobile phone?) as well as any personal comments on issues in China can be accessed by the authorities when a person is detained.
Many traveling executives are disciplined about avoiding making comments about political, economic and social issues in the public domain, but less circumspect about saying something to friends and family in what is considered to be the security of personal chat applications in either one to one or group communications. If one is arrested or detained by the authorities in the PRC, these personal communications are not safe and if they involve comments regarding any matter that the authorities deem to be sensitive, and a “state secret”, then the user is in trouble. Even communicating with the wrong person can lead to accusations of breaches of national security simply by being in contact with that individual. The boundaries of information that can be crossed to constitute espionage are narrow in the PRC, and business people must better understand this.
It may not be best to look to the Ministry of State Security for education. The MSS started in January to release comic style publications to highlight the threat to China from espionage cases. The MSS comics seem to be aimed at the local population both to hype the threat from “foreign forces” and also to arouse greater patriotism for the patriotic counter-espionage agencies fighting them. The first episode told the story of national security police officers who outsmart foreign spies. The state owned news outlet Global Times reported that “Li Wei, an expert on national security at the China Institute of Contemporary International Relations, told the Global Times on Sunday that the comic series is visually appealing to teenagers and children in particular and the impressions they form after watching the comic series are likely to be deeper, which can better foster awareness of national security among the young generation.”
Support from the China Institute of Contemporary International Relations is hardly surprising as this is a think tank operated by the 11th bureau of the Ministry of State Security. Aiming counter espionage education information at teenagers may not be new in communist China, but the role of the Ministry of State Security in doing so suggests that the modern honourable schoolboys will come from China.