U.S. businessman freed after 10 years in China jail

SHANGHAI (Reuters) - A U.S. businessman has been paroled after spending more than 10 years in a Chinese prison on charges of tax evasion and fraud, in a case top U.S. officials raised in talks with China on human rights.

Jude Shao, a Shanghai native who became a U.S. citizen in 1997, was paroled on Wednesday from Shanghai's Qingpu Prison, where he had been serving a 16-year sentence due to expire in May 2013, a human rights group and his supporters said.

A Shanghai court granted parole after Shao, in his mid-40s, agreed to live in Shanghai with his family, the San Francisco-based Dui Hua Foundation, which seeks the release of political prisoners in China, said on its website (www.duihua.org).

Shao, a graduate of California's Stanford business school, was arrested in 1998 and sentenced in 2000 for evading $253,000 of sales taxes and issuing false tax invoices at his Shanghai business, which imported U.S. medical equipment into China.

His supporters, who included university classmates and business colleagues, said the charges were groundless and vindictive, and that the case was opened after Shao refused to pay a bribe solicited by a Shanghai tax auditor.

U.S. Secretary of State Condoleezza Rice, who visited Beijing this week, raised Shao's case with the Chinese foreign minister in February this year, when China said it was willing to resume a dialogue with the United States on human rights.

The executive director of Dui Hua, John Kamm, said he hoped the parole was "a sign of greater cooperation between the two countries in the area of human rights and rule of law."

Asked about the case on Thursday, Chinese Foreign Ministry spokesman Liu Jianchao said he did not know about it, but that in general China was a country ruled by law.

(Reporting by Andrew Torchia; Editing by Jerry Norton)