SHANGHAI -- Chinese police handed to prosecutors the case of four Rio Tinto PLC employees held on allegations of corporate espionage and bribery, potentially moving the case closer to trial.

Monday was the legal deadline for police to conclude their investigation in the criminal case against Australian national Stern Hu and three other employees of the Australian mining giant. While a quick trial is possible, China's legal system gives prosecutors at least five more months to consider the merits of the case, including whether to bring it to trial and whether to reopen the investigation.

Rio Tinto and China

See a timeline of China's detention of four Rio Tinto executives.

It would be unusual for China's government to abandon such a high-profile, politically sensitive case after it has been handed to prosecutors.

Some foreign businesses viewed the detentions, which came while China was engaged in tense iron-ore pricing talks with miners, as a sign of how China can use economic might to challenge multinationals.

Since the employees were formally arrested in August, Chinese officials have portrayed the case as a basic criminal matter.

Australia's government said the four are being held on suspicion of violating commercial secrets and accepting bribes.

Rio Tinto, which isn't a party to the case, has denied wrongdoing on the part of the company and its employees. Calls for comment to lawyers for the employees weren't answered.

China's state-run Xinhua news agency said the four employees had been "handed over to local procuratorate for prosecution." Mr. Hu and his subordinates are likely to remain in detention in Shanghai, where they have been held since July.

Rio Tinto's Shanghai office, in July. Iron ore was China's No. 2 import in 2009. Reuters

"The next step is for the prosecutors to review the case carefully and decide if further investigation is needed," said Wang Shunan, a criminal law expert with China University of Political Science and Law, speaking generally about the legal system. "How long the prosecutors take to make such decisions and how long their investigations last varies between different cases."

Rio Tinto Iron Ore division Chief Executive Sam Walsh called the transfer "the next stage in a continuing legal process under Chinese law. ... It would not be appropriate for the company to comment any further at this point in the case other than to reaffirm our hope that matters proceed in an expeditious and transparent manner."

The case appears to hinge on how Mr. Hu's team managed one of world's largest commodity-sales networks, specifically Rio Tinto's multibillion-dollar supply of iron ore to China's steelmakers. Chinese officials haven't released evidence to back up the accusations, nor detailed them with formal charges.

As the primary sales team for Rio Tinto in China, the executives handled a large, lucrative and sensitive commercial relationship with China. Rio Tinto primarily sells iron ore, a mineral devoured in rising quantities by China's steel industry, the world's largest.

Last year, Chinese customs figures show, the country imported 627.8 million metric tons of iron ore, valued at $50.14 billion -- second among imports only to the $89.26 billion spent on crude oil. Ore-import volumes grew three times as fast as oil imports last year, with volumes rising almost 42%.

But Beijing has complained for years that a clutch of big foreign ore suppliers, including Rio Tinto, charge too much.

The Rio Tinto executives were detained days after the breakdown in June of a critical round of talks in which China had pledged to secure a sharp price reduction. Australia's government at the time said its diplomats were informed by Beijing of allegations of a link between the arrests and the talks.

Write to James T. Areddy at and Alex Wilson at