China is investigating two Canadian nationals for suspected theft of state secrets involving military and national defence research.

The official Xinhua news agency identified the two Canadians as Kevin Garratt and Julia Dawn Garratt, but did not say whether they had been detained.

It said the State Security Bureau of Dandong City, in north-east China's Liaoning province, was investigating the case.

Canada's embassy in Beijing said it was aware of reports that two Canadians had been "detained" in China and was gathering information.

"Our consular officials stand ready to provide assistance as required," embassy spokeswoman Mary Anne Dehler said.

Canadian newspaper The Globe & Mail said the Vancouver couple had been living in China since 1984 and opened a coffee shop called Peter's Coffee House in Dandong in 2008.

The couple previously worked as teachers in southern China.

The western-style coffee shop had a view of traffic flowing across the China-North Korea border, said the newspaper, adding the couple had a side business helping holidaymakers plan tours to North Korea across the Yalu River.

It said the immediate whereabouts of the Garratts was unknown and calls to their coffee shop went unanswered.

China's state secrets law is notoriously broad, covering everything from industry data to the exact birth dates of state leaders.

In severe cases, the theft of state secrets is punishable with life in prison or the death penalty.

Beijing is also sensitive about its relationship with North Korea, whose ruined economy is partly kept afloat with Chinese aid.

Information in China can be labelled a state secret retroactively.

The investigation into the Garratts comes a week after Canada took the unusual step of singling out Chinese hackers for attacking a key computer network and lodged a protest with Beijing.

Canadian officials have said "a highly sophisticated Chinese state-sponsored actor" broke into the National Research Council, the government's leading research body, which works with big firms such as aircraft and train maker Bombardier Inc.

In response, Beijing accused Canada of making irresponsible accusations that lacked credible evidence.

Canada's right-leaning conservative government has had an uneven relationship with Beijing since taking power in 2006.

Citing human rights concerns, Prime Minister Stephen Harper initially kept his distance.

Under pressure from business in Canada, he sought to reach out to Beijing.

China is Canada's second most important trading partner after the United States, and bilateral trade is growing.

Reuters