Australian senator quits shadow cabinet over China payments row

SYDNEY (Reuters) - An Australian opposition senator quit the shadow cabinet on Wednesday after saying he had failed to declare that a Chinese company had made payments on his behalf for travel and legal bills.

Relationships between politicians and Chinese government interests have become a hot button issue in Australia amid concern that China is intent on gaining extensive commercial assets in the resource-rich country.

Senator Sam Dastyari, 33, widely viewed as a rising star of the centre-left Labor opposition party, has been fending off a public backlash over the past week after media reported he asked a Chinese company to pay his expenses on a trip.

"I freely admitted that I made a mistake," Dastyari said as he announced he was quitting his post as manager of opposition business in the Senate. He will remain in the Senate.

Dastyari's political opponents say he broke political donation rules. He has maintained he did nothing improper apart from forgetting to declare a payment.

"I made all the necessary disclosures and what I did was within the rules but it was wrong," he said.

"It's clear that the ongoing examination of my behavior is taking attention away from bigger issues facing Australia and Australians."

Dastyari on Tuesday apologized for his "error of judgment" in a news conference. But the government of Prime Minister Malcolm Turnbull dismissed the apology as inadequate.

Concern about the scope of acquisitions and influence by Chinese interests grew in 2015 when the government of Northern Territory state sold the port in Darwin city to a Chinese company.

Since then, the federal government has been at pains to demonstrate limits to its ties to the country's biggest export partner, blocking sales of Australia's biggest cattle station and biggest power grid to Chinese interests.

(Reporting by Byron Kaye; Editing by Robert Birsel)

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