Germany arrests three people suspected of giving technology to China

By Andrey Sychev and Rachel More

BERLIN (Reuters) - Three Germans have been arrested on suspicion of working with the Chinese secret service to hand over technology that could be used for military purposes, potentially helping to strengthen China's navy, German officials said on Monday.

The arrests came a week after Chancellor Olaf Scholz travelled to China to press Beijing on its support for Russia's wartime economy and to raise issues of intellectual property theft and fair market access.

Interior Minister Nancy Faeser said the government was monitoring what she called a significant threat posed by Chinese espionage in business, industry and science.

"We look very closely at these risks and threats and have clearly warned and raised awareness about them so that protective measures are increased everywhere," she said in a statement.

In this case, the issue of German innovative technologies that can be used for military purposes was "particularly sensitive", she added.

Justice Minister Marco Buschmann said in a statement: "At the time of their arrest, the accused were in further negotiations about research projects that could be particularly useful for expanding China's maritime combat power."

The Chinese embassy in Berlin said Beijing firmly rejected accusations that it carried out spying activities in Germany.

"We call on Germany to desist from exploiting the espionage accusation to politically manipulate the image of China and defame China," a spokesperson for the embassy said in an emailed statement.

Prosecutors identified the suspects as Herwig F. and Ina F, a married couple who run a company in Dusseldorf, and Thomas R., described by prosecutors as an agent for an unidentified employee of China's Ministry of State Security (MSS).

The couple concluded a cooperation agreement with a German university through their company, which involved preparing a study for the MSS employee on machine parts that can be used for marine engines such as in warships, prosecutors said in a statement.

The suspects also purchased a special laser from Germany on behalf of and with payment from the MSS, and exported it to China without authorisation, according to the prosecutors, who did not specify what the laser could be used for.

The arrests were made on the basis of information gathered by Germany's domestic intelligence agency, prosecutors said.

Last week, Germany arrested two Russian-German nationals on suspicion of spying for Russia. They were said to have plotted sabotage attacks aimed at undermining Germany's military support for Ukraine in its war against Russia.

(Writing by Matthias Williams and Riham Alkousaa; Editing by Ed Osmond, Peter Graff and Christina Fincher)