Blurry line that makes hi-tech US trade a dangerous dance for Chinese

It was a striking reversal of fortune. Wu Zhenzhou, a Harvard-educated business executive, was in Chicago on his way to a Yale University CEO summit when he was arrested in December 2008. He was shackled, transferred from one detention centre to another, and finally charged with a serious crime: exporting US military technology to Chinese state entities.

Wu was sentenced in late January this year to eight years in a US federal prison. He has said he is innocent and plans to appeal.

While President Hu Jintao's state visit to the US last month celebrated bilateral trade and co-operation, Wu's case and others like it show the limits of the US appetite for trade with China. When it comes to perceived threats to national security, American officials and courts draw a hard line.

The Department of Justice has portrayed Wu's sentence as an important deterrent to others who might be tempted to sell guarded US military technology for money or in the name of ideology. China's espionage efforts depend on willing businesses like the one Wu founded, Shenzhen-based Chitron Electronics Inc, a US Congressional advisory panel has said.

At the same time, the US laws on licensing of hi-tech exports used to convict Wu have come under fire. They are too broad, poorly administered and in need of a thorough overhaul, US Defence Secretary Dr Robert Gates has said.

Is Wu the victim of a cumbersome set of US export restrictions? That is his argument, and Wu has hired a high-profile lawyer and Harvard law professor, Alan Dershowitz, to make his case.

'This law is so unclear you can't understand it even if you study it and study it and study it,' Dershowitz said. 'It's just too vague. It's too general. It serves as a trap for honest people who try to comply with the law and cannot understand it.'