Yang Hengjun was detained in January shortly after making a rare return to China from US.

An Australian pro-democracy academic held for seven months in China has been formally arrested for spying, Foreign Minister Marise Payne said Tuesday as she demanded Beijing uphold "basic standards" of justice.

Payne said she was "very concerned" that Chinese-born Yang Hengjun -- a former official turned author -- had been arrested on "suspicion of espionage".

Yang had been detained after returning to China from the United States in January.

Now in his 50s, he had used popular blog and social media posts to criticise Beijing's authoritarian government. He has a following of more than 125,000 on Twitter alone.

After months without access to his lawyer or family, Yang now faces trial on charges that could bring a lengthy prison sentence.

China's near-silence about Yang's fate has been a point of friction in relations with Australia that have markedly deteriorated in recent months.

In a sharply worded statement, Payne said she had raised the case five times with her Chinese counterpart Wang Yi, in person and via letters.

"Dr Yang has been held in Beijing in harsh conditions without charge for more than seven months," Payne said, referencing international rules prohibiting torture.

"Since that time, China has not explained the reasons for Dr Yang's detention, nor has it allowed him access to his lawyers or family visits."

"We expect that basic standards of justice and procedural fairness are met," she said. "If Dr Yang is being held for his political beliefs, he should be released."

Yang is the latest in a string of foreign nationals to be arrested in China and charged with espionage or attempting to steal state secrets.

Two Canadians, former diplomat Michael Kovrig and businessman Michael Spavor, were detained in December.

Australia has traditionally been keen to avoid friction with Beijing, but Yang's arrest will increase public pressure on Canberra to take a tougher line against its most important trade partner.

There is a growing concern about Beijing's influence in Australian politics, its more aggressive foreign policy and growing military clout in the Pacific.

Australian universities have come under the microscope for lucrative contracts with the Chinese government, while the government has been accused of not protecting dissidents and refugees now resident Down Under.

On Monday, an official corruption inquiry heard that a well-connected Chinese property developer delivered Aus$100,000 in cash to the opposition Labor Party's headquarters before a 2015 election.

The man, Huang Xiangmo, was effectively banned from returning to Australia in February.

Yang had initially been held in "residential surveillance at a designated location" before being moved to criminal detention, his lawyer told AFP.

"His arrest has now been approved by the procuratorate. Now he is formally arrested," Mo Shaoping said.

"He is suspected of espionage and has been arrested, when he was originally detained he was also suspected of espionage."