Chinese arms firms offered to sell weapons worth about $200 million to Libyan leader Muammar Gaddafi's beleaguered forces in July, two newspapers reported, compounding pressure on Beijing's brittle ties with the rebels who have ousted him.
Following an earlier report in the Globe and Mail, the New York Times reported on Monday that documents found abandoned in the Libyan capital, Tripoli, indicated that Chinese companies offered to sell rocket launchers, anti-tank missiles and other arms to Gaddafi's forces, despite bans on such sales.
"We have hard evidence of deals going on between China and Gaddafi, and we have all the documents to prove it," a rebel military spokesman, Abdulrahman Busin, told the Times.
Reuters could not verify the reports or the documents cited, and some officials told the Times report they were sceptical or uncertain.
A "senior NATO diplomat in Brussels discounted the report as highly unlikely", and members of a United Nations overseeing sanctions on Libya said "nothing about arms dealings with China had been brought to their attention", said the Times report.
China's Foreign Ministry said that members of Gaddafi's government had come to China and held talks with a "handful" of Chinese arms companies without the knowledge of the government.
"After the passing of resolution 1970 by the Security Council, we notified relevant government departments to strictly implement it," ministry spokeswoman Jiang Yu told a regular news briefing in Beijing.
"We have clarified with the relevant agencies that in July the Gaddafi government sent personnel to China without the knowledge of the Chinese government and who engaged in contact with a handful of people from the companies concerned," she added.
"The Chinese companies did not sign arms trade contacts and nor did they export military items to Libya," Jiang said. "I believe that the agencies in charge of the arms trade will certainly treat this seriously."
Even if the arms were not delivered, or the cited documents turn out to have no foundation, the controversy could intensify mistrust between Beijing and the rebels seeking to defeat Gaddafi's shrinking forces and claim control of all Libya.
On the weekend, the head of Libya's rebel National Transitional Council (NTC) Mustafa Abdel Jalil said China had obstructed the release of some of Libya's frozen assets.
Although China agreed with other powers last week the unfreeze of $15 billion of Libyan assets abroad, it opposed handing control of more to the interim ruling council, according to Libyan rebel spokesman Shamsiddin Abdulmolah.
The Chinese Foreign Ministry has not responded to faxed questions from Reuters about that issue.
Libya's interim council has promised rewards for those who took a leading role in backing the revolt against Gaddafi, and that has raised concerns that China could be disadvantaged.
China is the world's second-biggest oil consumer, and last year it obtained 3 per cent of its imported crude oil from Libya.
China did not use its UN Security Council veto power in March to block a resolution that authorised the NATO bombing campaign against Gaddafi's forces, but it condemned the expanding strikes and repeatedly urged compromise between his government and rebels.
Beijing had since courted Libyan rebel leaders, and has urged a "stable transition of power".
The reports said Libyan security officials visiting China in July were received by three arms companies, including Norinco and the China Xinxing Import and Export Corporation.
"The (Chinese) companies suggest that they make the contracts with either Algeria or South Africa, because those countries previously worked with China," said a Libyan government memo, according to the Globe and Mail.
By the time of the reported visit, Chinese officials were already courting Libyan rebels. China has not joined Western powers in formally recognising the rebels' National Transitional Council as the legitimate authority in Libya, but has acknowledged its "important role" after Gaddafi's ousting.
Norinco, one of the Chinese firms reported to have offered arms to Libyan forces, has faced sanctions from the United States, which accused it of selling missile parts to Iran.