(ICPC note: Liu Xiaobo is the president and Shi Tao a member of the Chinese Independent PEN Center)

A leading Chinese advocate of internet freedoms has issued a scathing denunciation of the US portal Yahoo for its role in helping Communist authorities to prosecute an independent-minded local journalist, jailed for 10 years for "leaking state secrets".

Veteran dissident Liu Xiaobo, in an open letter to Yahoo co-founder Jerry Yang, accuses the US company of betraying its customers and supporting dictatorship by providing information on journalist Shi Tao to Chinese authorities.

"Major foreign companies should not be helping the Chinese government to limit freedom of speech on the internet," Mr Liu told the Financial Times. "This is shameless."

Mr Yang, who recently sealed a $1bn (€830m, ¡ê570m) link-up with the Chinese commerce website Alibaba, confirmed last month Yahoo had assisted the action against Mr Shi, but said it had no choice but to provide information about him as part of a "legal process".

Yahoo yesterday refused to comment on the contents of the letter. A company spokeswoman at its base in Silicon Valley said it only released information to the authorities "when legally compelled to do so, and then only in a way that complies with both local laws and our privacy policy".

Mr Shi was jailed for 10 years in April, apparently for revealing information about a media crackdown by party propaganda officials.

Some commentators have defended Yahoo, saying companies doing business in China cannot defy the government, but that their operations encourage greater openness and improve the lives of ordinary Chinese.

Mr Liu dismisses such arguments in his letter, however. The author, who has spent years in jail for his criticism of the Communist party, says Yahoo has enough market clout not to need to toady to authorities.

International companies are ignoring basic human rights in return for business opportunity, while the Communist party is offering profits in return for continued control of the internet and the ability to intimidate dissidents, Mr Liu writes.

"The collusion of these two kinds of ugliness means that there is no way for western investment to promote freedom of speech in China, and that in fact it greatly increases the ability of the Communist party to blockade and control the internet," he writes.

"You are helping the Communist party maintain an evil system of control over freedom of information and speech," he writes.

Google has excluded sites blocked by the state from its Chinese news service, while MSN banned the words "freedom" and "democracy" from parts of its new Chinese website.

In his letter, Mr Liu calls on internet users to boycott Yahoo services until the company apologises to Mr Shi, compensates his family and "ceases close co-operation" with China's censors.

Mr Liu also challenges Yahoo to explain the legal basis of the apparent decision by its Hong Kong business to provide information on Mr Shi, even though the former British colony has an independent judiciary.