(Bloomberg) -- German authorities arrested two men and a woman suspected of working for Chinese state security to acquire details of ship-engine technology and buy a special laser without export authorization.

It’s the second espionage case to come to light in Germany in a matter of days after two Russian-German citizens were taken into custody last week accused of spying for Russia and membership of a terror group planning acts of sabotage.

The latest revelations about China could further complicate Chancellor Olaf Scholz’s effort to reset relations with Germany’s biggest trading partner.

A domestic intelligence report published last year included the Asian nation on a list of countries “with massive spying activities” in Germany, along with Russia, Iran and Turkey.

Scholz, who met last week with President Xi Jinping and Premier Li Qiang in Beijing, has sought to keep channels to the Chinese government open while pushing Germany’s biggest companies to make sure their risks are manageable in case tensions escalate.

China’s embassy in Berlin said in a statement distributed by its press office that it “firmly rejects the accusation that China is allegedly engaging in secret-service activities in Germany.”

“We call on the German side to refrain from exploiting the accusation of espionage in order to politically manipulate the image of China and defame it,” according to the statement.

The Federal Prosecutor in Karlsruhe named the three German citizens arrested Monday in Duesseldorf and Bad Homburg near Frankfurt as married couple Herwig and Ina F. and Thomas R.

According to the prosecutor’s statement, Thomas R. acted as an agent for China’s ministry of state security to procure “information in Germany on innovative technologies that could be used for military purposes.”

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A company run by Herwig and Ina F. in Duesseldorf was used “for establishing contacts and collaborating with people from the German scientific and research community.”

“The object was to prepare a study for a Chinese partner on the state of machine-part technology that is also important for the operation of powerful ship engines, for example in combat ships,” the prosecutor said.

“At the time of their arrest, the suspects were in further negotiations about research projects that could be useful for the expansion of China’s maritime combat capability,” it added.

China’s Ministry of Foreign Affairs in Beijing did not immediately respond to a request for comment.

Interior Minister Nancy Faeser said that Germany is “aware of the considerable danger posed by Chinese espionage in business, industry and science” and called China’s apparent targeting of technology that can be used for military purposes “particularly sensitive.”

“We are looking very closely at these risks and threats and have issued clear warnings and raised awareness so that protective measures are increased everywhere,” Faeser said in an emailed statement.

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The prosecutor said Monday that after purchasing the laser “on behalf of and with payment from the MSS” the accused exported it to China without authorization even though it’s subject to European Union dual-use regulations.

Scholz’s ruling coalition last year published a policy paper detailing out how Germany plans to address the challenges posed by China’s growing dominance, including securing access to critical raw materials and diversifying supply chains.

--With assistance from Lucille Liu.

(Updates with Chinese embassy comments starting in sixth paragraph)

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