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China’s bid to strangle the supply of heavy rare earth elements around the world was about to hit a wall. Vietnamese entrepreneur Lou An Tuan has helped us with technology that could break Beijing’s chokehold for the critical minerals behind everything, from smartphones to missile regulation systems.
Tuan and his family fled Vietnam for the US to escape Beijing’s tough grip on Hanoi, where the Chinese Communist Party has had a major impact on domestic governance.
In July 2023, he signed a technology transfer agreement found in Fox News Digital, bringing the heavy rare earth separation technology he used in a Nevada-registered company at his Vietnam-based company, Vietnam Rare Earth (VTRE). VTRE had also signed a series of memorandums of Understanding with Western Companies (MOU) Agreement.
“He had a sense of uncertainty about being in Vietnam. He decided to move his technology to the US as soon as possible,” a source familiar with the rare earth industry told Fox News Digital that he gave him anonymity without fear of retaliation.
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September 7, 2023, Luu Anh Tuan, chairman of the Hanoi office’s mining company VTRE with samples of rare earth oxides in Hanoi, Vietnam. (Reuters)
At the time, the world was completely dependent on Chinese companies to separate heavy rare earth metals.
“China has actually worked to build this domination for over 20 years now,” said Greserin Bascaran, director of the Key Mineral Security Program at the Center for Strategic and International Research.
Additionally, companies such as US-based MP Materials and Australia-based Lynas are in the process of developing their own separation technology, but China still manages up to 90% of rare earth separation and refining capabilities, and more than half of mining production.
In October 2023, Tuan, a then-US permanent resident and green card holder, returned to his Hanoi office when Vietnamese authorities stormed the building and seized all laptops and records. According to Richard Dunham, Tuan’s American business partner, 17 employees have been arrested, and all but one employee have been released except for Tuan’s step-sister and VTRE COO Hanh Huong.
The arrest came shortly after President Joe Biden visited Vietnam and signed a cooperation agreement on rare earth minerals.
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In December, China banned rare earth extraction and separation. This is what the industry saw as another effort to maintain its market monopoly.
“When China put these restrictions on it, it really made us realize that countries like the US and Australia don’t even have the technical know-how to actually do it on their own,” Bascaran said.
“The process itself is very labor-intensive and very toxic,” said Josh Birenbaum, a mineral expert at the Democracy Foundation, adding that China has cornered the market through state subsidies and environmental concerns.
The US has one major rare earth mine, MP Material Mountain Pass, but until this year the company exported those rare earths to China for separation. The subsequent trade war and export restrictions led the US to stockpile rare earths until its ability to separate at home expanded.
Thuan is accused of forging a value-added tax receipt while trading rare earths with Thai Duong Group, which operates a mine in Yenbai province in northern Vietnam.
Xenotime Ore (Getty Images)
VTRE is partnering with an Australian mining company, and according to Australian Strategic Materials and Blackstone Minerals Ltd. Dunham, both were “eager” about the proposal, which ultimately led to the signing of a transfer agreement.
The arrest also came when Vietnam prepared to auction off the Dong Pao mine. According to Dunham, Vtre, supported by Western partners, was the only eligible bidder.
This year, Tuan pleaded guilty in exchange for a light sentence. He spends 16 years in prison with a $10 million fine, but his supporters say he was “forced.” Huong was sentenced to six years in prison.
“We believe these accusations will be manipulated. They are accusations established by the Vietnamese national actors who have reorganized with China,” Dunham said. “He was tortured to get a guilty plea.”
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Fox News Digital could not independently verify this claim. The State Department documents reliable reports of arbitrary arrests, torture and inhumane treatment by authorities, affecting both political detainees and others in detention. Medical negligence and forced confessions are frequently reported.
Tuan’s supporters say the company where he was purchasing the ore from Thai Duong refused to provide the invoice that the actual rate VTRE paid for the ore. It only offered invoices that claimed it was selling the ore at a lower tax rate, reducing taxable income.
According to Dunham, Thai Duong refused to issue an invoice that reflects the actual selling price to the VTRE in order to avoid environmental, natural resources and corporate income tax.
Tuan faced a choice. Accepting low-rate bills, compensate for tax inconsistencies with his own money, or allow his state-funded mineral projects, and his business collapses with every Dunham.
Tuan was convicted of criminal charges, but Dunham said there was no evidence of criminal intent in violation of accounting regulations.
“Even if he guilty of accounting issues, it is not criminally liable for what they are trying to do. The Vietnamese location was not problematic with this kind of sentence.
“He is the only individual outside of China, and has a fully integrated rare earth company from mining to metallization. In other words, from excavating from the ground to making magnets.”
China controls the world’s rare earth market. (Reuters)
Thuan was convicted of smuggling rare earth materials, but customs documents show clearance of 63 shipments of heavy rare earth oxide mixtures under tax code 2846 corresponding to rare earth compounds. According to Dunham, the court misclassified exports under Tax Act 2530 (raw ore) and mistakenly argued that they were illegal.
An investigation by the Vietnam Ministry of Public Safety concluded that customs officials who signed VTRE’s 63 export declarations have verified Tuan’s compliance.
China’s crackdown has been accelerating since then. Mineral experts are ordered to abandon their passports and not be able to share technology abroad. Beijing has strengthened its control over rare earth exports, igniting major concerns from within the US defense industry. China has allowed them to flow again during trade negotiations with the Trump administration, but they remain banned for defensive purposes.
According to Dunham, VTRE has developed a technology to produce heavy rare earth oxides from Xenotime, Monazite and Ion-absorbing clays at 95% purity via a solvent extraction system. This technology has been able to process a variety of mineral types and recycle NDFEB magnets.
According to Tuan supporters, requests for support from the US government are not fruitful.
Tuan is essentially separated from his family and attorneys. He has seen his family about five times since his arrest almost two years ago.
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“We are deeply concerned about his physical and mental well-being,” the source said. “He’s mentally resilient. He continues to believe that the truth will eventually be revealed.”
Fox News Digital has reached out to the White House, the State Department, the Chinese Embassy and the Vietnam Embassy for comment.
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