Beijing Court Sentences American Geologist to Eight Years for State Secrets

July 30, 2010

On July 5, 2010, the Beijing No. 1 Intermediate People's Court sentenced Dr. Xue Feng, a naturalized American citizen, to eight years in prison for allegedly helping the American company he worked for purchase commercial information on oil wells in China. The court said the information was a state secret and the purchase had endangered China's national security. Officials reportedly did not declare the information a state secret until after the transaction occurred; attempted to coerce Dr. Xue into confessing to the crime by allegedly torturing him; violated China's consular agreement with the United States by delaying notification of Dr. Xue's detention and limiting access by American officials; and violated China's Criminal Procedure Law with respect to the handling of Dr. Xue's case. The case also highlights the risk for foreign companies and their employees competing or doing business with China's state-owned enterprises, which can leverage state secrets laws to protect their commercial interests.


Dr. Xue is a geologist who was born in Xi'an city, Shaanxi province, according to a November 19, 2009, Associated Press (AP) article (via Huffington Post). He studied northern China rock formations at the University of Chicago, where he received his Ph.D., the article said. In 2001, a Colorado-based energy consulting firm, IHS Energy (now IHS Inc.), hired Dr. Xue to be the company's Northeast Asia manager, AP reported. In 2005, Dr. Xue allegedly helped IHS purchase from a third party a commercial database containing information on the locations and reserves of 32,115 oil wells and prospecting sites that were mostly owned by PetroChina Co., according to a July 6, 2010, Wall Street Journal (WSJ) article's (registration required) recounting of the court's findings. PetroChina's controlling shareholder is China National Petroleum Corporation (CNPC), a large state-owned enterprise (SOE) under the jurisdiction of the State-owned Assets Supervision and Administration Commission (SASAC), according to PetroChina's Web site. Dr. Xue, a naturalized American citizen, reportedly "disappeared" into official custody in Beijing on November 20, 2007, according to a July 21, 2010, op-ed in the South China Morning Post (via U.S.-Asia Law Institute) by Jerome Cohen, co-director of NYU Law School's U.S.-Asia Law Institute. On July 5, 2010, the Beijing No. 1 Intermediate People's Court sentenced Dr. Xue to eight years in prison plus a fine of 200,000 yuan (US$29,850) for purportedly trafficking state secrets, WSJ reported. (See Article 111 of China's Criminal Law.) Dr. Xue has appealed the verdict, a July 16 WSJ article reported.

Procedural Abuses

During the two-and-a-half year period that Dr. Xue was in custody before his sentencing, Chinese officials reportedly committed numerous procedural abuses.

  • Consular Notification and Access Violations. Under Article 35(2) of the U.S.-PRC Consular Convention of 1980 Chinese officials were supposed to notify U.S. officials "no later than" four days after "any form of detention" of a U.S. national. In Dr. Xue's case, however, Chinese officials waited three weeks before acknowledging to U.S. officials that Dr. Xue was being held by the Ministry of State Security, according to the Cohen op-ed. Furthermore, the op-ed noted that Chinese officials did not allow American officials to visit with Dr. Xue until the 32nd day of his detention. Article 35(4) of the convention states that officials shall be able to meet with their national "at the latest" two days after notification of the detention.
  • Torture Allegations. Dr. Xue reportedly showed American consular officials burn marks on his arms made by investigators, according to the AP article. The op-ed said that police coerced Dr. Xue into "signing false documents," and that in May 2008 an officer injured Dr. Xue by throwing a glass ashtray at his head.
  • Criminal Procedure Law Violations. The Ministry of State Security transferred Dr. Xue to the Beijing State Security Bureau detention house on February 4, 2008, and he was formally arrested on April 11, according to the op-ed. Assuming February 4 is the date Dr. Xue was formally detained, officials violated Article 69 of the Criminal Procedure Law (CPL) by not formally arresting him within the 37-day limit. Based on the op-ed, another period of more than seven months passed before state security officials forwarded the case to prosecutors sometime around December 2008. Articles 124, 126, and 127 of the CPL appear to place a seven-month limit on this period. Six months passed between December 2008 and Dr. Xue's indictment in May 2009, according to the op-ed. Articles 138 and 140 of the CPL would appear to limit this period to three-and-a-half months. The Beijing No. 1 Intermediate People's Court held the first hearings in Dr. Xue's trial in July 2009, according to AP, meaning the court had agreed to accept the case before this date. Article 168 of the CPL says a court has up to two-and-a-half months after accepting a case to pronounce a judgment, and Article 166 allows for one-month postponements if prosecutors request supplementary investigations. Cohen said prosecutors had requested two postponements, which would have placed the outer limit between the court's accepting the case and pronouncing the judgment at four-and-a-half months. The judgment was not pronounced until July 2010. As the op-ed noted: "As winter turned to spring, [the court] ran out of legal grounds for further delays and no longer attempted explanation."
  • Access to Counsel Violations. According to the op-ed, authorities denied Dr. Xue access to counsel for more than a year.

State Secrets―Impact on Rule of Law and Foreign Companies Doing Business in China

Dr. Xue's case highlights several problems with China's state secrets regime―problems that make it susceptible to abuse if Chinese officials wish to use it to protect commercial interests.

  • Retroactive Classification. It was only after the transaction took place that officials classified the information as a state secret, according to a July 4 Dui Hua article.
  • Commercial Information as State Secret. The line between commercial information and state secrets is blurry under Chinese law. The state secrets law currently in effect provides wide latitude for officials to declare information a state secret, including "secrets in national economic and social development," "secrets concerning science and technology," and "other matters that are classified as state secrets by the state secret-guarding department." Cohen said that in Dr. Xue's case "there was no meaningful way to clarify the line between common, commercial information and state secrets." The blurring of commercial information and state secrets is especially problematic when dealing with SOEs. For example, Jiang Jiemin, General Manager of CNPC, the SOE that controls PetroChina, said in June 2010 that oil is an "important strategic asset," and that the company's work to protect its secrets bears on China's national security and social stability, according to the company's Web site. Chinese regulations make explicit that some commercial secrets of SOEs shall be considered state secrets. In March 2010, SASAC issued Interim Provisions on the Protection of Commercial Secrets of Central Enterprises, Article 3 of which requires central-level SOEs to protect "the operating information and technical information which belongs within the scope of state secrets." According to SASAC's Web site, CNPC is a central-level SOE and is thus subject to this requirement. In addition, according to an April 30 21st Century Business Herald article, since SOEs, especially central SOEs, have "a certain administrative rank," they may themselves possess the power to declare information a state secret. Dr. Xue's case follows another case involving the Anglo-Australian mining firm Rio Tinto. In July 2009 four employees of that firm were charged with stealing state secrets shortly after Rio Tinto pulled out of a proposed $19.5 billion deal with a major state-owned firm. The charges were reduced to commercial bribery and commercial secrets infringement the following month.
  • Lack of Meaningful Judicial Review. In criminal cases involving state secrets, Chinese courts do not have the power to question an agency's classification of information as a state secret, according to a 2007 Human Rights in China report on China's state secrets system. Furthermore, in cases where endangering national security is alleged, such as cases involving the charge of inciting subversion, courts make little to no assessment of the actual harm to national security. In Dr. Xue's case, the July 6 WSJ article reported that the court provided few details regarding the damage the transaction caused to China's national security.