* German man suspected of passing on documents to US contact
* Case may further strain ties with US after Snowden affair
* Surveillance is especially sensitive issue in Germany
(Adds U.S. embassy comment)
By Andreas Rinke
BEIJING, July 7 German Chancellor Angela Merkel
said on Monday allegations that a German man had worked as a
double agent for U.S. intelligence were serious and, if true,
were a clear contradiction of what cooperation between partners
is supposed to be about.
The case risks further straining ties with Washington, which
have been sorely tested by revelations last year of large-scale
snooping on Germany by the U.S. National Security Agency (NSA).
"If the reports are correct it would be a serious case,"
Merkel told a news conference in Beijing, standing next to
Chinese Premier Li Keqiang.
"If the allegations are true, it would be for me a clear
contradiction as to what I consider to be trusting cooperation
between agencies and partners."
The White House and State Department have so far declined to
comment on the arrest of a 31-year-old employee of Germany's BND
foreign intelligence agency. The U.S. embassy in Berlin said it
was aware of the allegations and was "working with the German
government to ensure this issue is resolved appropriately".
According to intelligence and political sources, the man
admits passing documents to a U.S. contact.
Those include information about a parliamentary committee
looking into allegations by former U.S. intelligence contractor
Edward Snowden that Washington carried out major surveillance in
Germany, including monitoring Merkel's phone.
German Foreign Minister Frank-Walter Steinmeier, who was on
a trip to Mongolia while Merkel was in China, said the spying
case would have consequences if the circumstances are confirmed.
"We haven't finished clearing this up yet. But if suspicions
are confirmed that American secret services were involved, it
will become a political issue and we can't just get back to
business as usual," he told reporters in Ulan Bator.
Surveillance is a sensitive issue in a country where
memories of the Nazi's Gestapo secret police and communist East
Germany's Stasi ensure the right to privacy is treasured.
Speaking in Berlin, Snowden's lawyer in Germany, Wolfgang
Kaleck, said he hoped the latest allegations might eventually
help change Germany's stance towards his client, noting that
European states had profited from his information but were not
prepared to protect him.
As Merkel visited China, where she oversaw the signing of
agreements involving Airbus Group NV's helicopter
division selling 100 aircraft to Chinese companies, a German
intelligence chief warned that some firms in China faced a
growing threat from industrial espionage by Chinese government
agencies with huge resources.
"Germany is against that - regardless of where it comes
from," Merkel said, in reference to industrial espionage.
"We have a duty as the state to protect our economy ... We
are for the protection of intellectual property."
China's premier repeated his government's denial that it was
involved in such activities.
"China and Germany, it can be said, are both victims of
hacking attacks. The Chinese government resolutely opposes
hacking attacks as well as the use of the internet to steal
commercial secrets or intellectual property," Li said.
"China will engage in dialogue and consultation to protect
the security of the Internet."
(Additional reporting by Megha Rajagopalan in Beijing and
Stephen Brown in Berlin; Writing by Ben Blanchard; Editing by