China Seeks Arrest of Brilliance China Automotive Holdings Executive
HONG KONG, Oct 23, 2002 Tan Ee Lyn writing for Reuters reported that Chinese authorities want to arrest auto executive Yang Rong, one of the country's richest men, for alleged involvement in economic crimes, in their latest crackdown on high-profile tycoons.
China's largest van maker, Brilliance China Automotive Holdings Ltd, said on Wednesday authorities in the northeastern province of Liaoning had approved the arrest of Yang, an executive director of the firm.
He has not been seen in public since June and is believed to be in ill health in the United States. The U.S. embassy in Beijing said there is no extradition treaty between China and the United States.
Yang's falling-out with Chinese authorities follows the arrest of orchid magnate Yang Bin, who headed one-time investor favourite Euro-Asia Agricultural (Holdings). Yang Bin had been tapped by North Korea to head a new free trade enclave.
The moves come as China's Communist Party plans to open its doors to private entrepreneurs for the first time in a bid to modernise. Once branded capitalist exploiters, businessmen are now seen as key to sustaining China's rapid economic growth.
The 16th Communist Party Congress next month is expected to unveil the next generation of leaders and adopt a plan to allow entrepreneurs to officially join the party, to the dismay of some veteran hardliners and young liberals.
Ranked by Forbes magazine as China's third-richest man in 2001, Yang was ousted in June as chairman of Brilliance China over what the firm said stemmed from an earlier difference with other shareholders. He remains an executive director.
Yang helped transform Brilliance China from a stagnant state-owned auto factory into a top minibus maker that is now setting up a joint venture with Germany's BMW AG.
He was believed in 2001 to have personal wealth of US$840 million, Forbes said.
OUT OF TOUCH
"We've been unable to contact him directly since June," a Brilliance executive told Reuters on Wednesday.
"We're considering removing him from the company as executive director," the executive added, declining to be identified.
Brilliance said in a statement that it had applied for a trading suspension of its shares from Wednesday pending a further announcement on the issue. The stock ended at HK$0.97 on Tuesday, down 17.94 percent over the last three months.
Another Yang-related company, Compass Pacific Holdings Ltd, said trading in its shares would remain halted pending a further announcement on price sensitive information.
Shares in Compass, which runs game centres and makes auto parts, were suspended on October 4. They last traded at HK$0.102.
Yang is also chairman of Shanghai Shenhua Holdings Co Ltd, a Shanghai-listed auto components maker and the main distributor of Brilliance China's minibuses.
In its statement, Brilliance China said it was informed by directors of Shanghai Shenhua that authorities in Liaoning province approved the arrest of Yang on October 18 for "suspected involvement in economic crimes".
Brilliance China said the suspected involvement of Yang in economic crimes was not related to the business and operations of the company, and neither have its other directors or management been questioned or investigated by authorities.
Shanghai Shenhua announced in the Shanghai Securities News on Wednesday that it had received the arrest approval notice on October 21 from Liaoning police.
Compass's statement informed shareholders that a special general meeting scheduled for Wednesday would not take place. Yang had earlier called for the meeting to sack six of Compass's directors.
