Copyright 1999 Journal of Commerce, Inc.
Journal of Commerce
January 12, 1999, Tuesday
SECTION: WORLD TRADE; Pg. 3A
LENGTH: 506 words
HEADLINE: Commerce blasts Congress over new export rules
BYLINE: BY MICHAEL S. LELYVELD
BODY:
In a release, Commerce's undersecretary for export administration, William
Reinsch, said a 1997 law that imposed the
controls on sales of faster computers has
""already been overtaken by technology.''
COMPUTER INSPECTIONS
Congress placed the reporting and inspection requirements on
exports of the computers to 50 countries regarded as nuclear risks in the wake of
reports that both Russia and China had diverted civilian supercomputers to
military uses.
The rules require Commerce to account for each sale of a computer that runs at
speeds faster than 2,000 million theoretical operations per second (MTOPS) and
to verify its end use with an on-site inspection.
""The resultant burden of on-site visits to each computer is an example of good
intentions leading to wasteful government expense and no improvement to
national security,'' Mr. Reinsch said.
In submitting its report to Congress, Commerce said that sales of high-
performance computers to the affected countries climbed 40 percent in the past
year, to 390 from 279 the year before. China accounted for 191 of the sales in
1998.
The agency conducted 104 inspections in countries that include Israel, India
and Pakistan.
As a result of an agreement on inspections last June, Commerce's Bureau of
Export Administration has conducted three on-site visits in China so far.
Although it did not say whether any evidence of diversions was found, Commerce
said that more than half the computers were being used by utilities,
communications and
financial industries.
RULES CALLED INEFFECTIVE
Mr. Reinsch blasted the inspection rules as ineffective.
""We spend too much time and money disrupting the legitimate business activities
of banks, insurance companies, telephone service providers and U.S.
subsidiaries. Congress should let us target our enforcement resources where
they will do the most good,'' he said.
The complaint against the computer rules may be a prelude to a conflict over
the yet-to-be-released recommendations of a House committee that recently
completed a classified report on all U.S. technology exports to China.
The panel chaired by Rep. Christopher Cox, R-Calif., found that U.S. export
policy has harmed national security.
ADMINISTRATION GETS IT
The 700-page report with its 38 recommendations was sent to the administration
last week. A declassified version is likely to be released next month.
Friction with Commerce
may result because the agency has tried to promote U. S. export interests while
administering export controls on goods with potential military applications.
The Cox committee began its investigation following reports that China gained
technology for its missile program as a result of U.S. cooperation on
commercial satellite launches.
Commerce said Friday that it will not release its report on high- performance
computer exports in its entirety because it contains sensitive business
information.
A Commerce press official said Monday that there are no plans to publish any
further details.
LOAD-DATE: January 12, 1999
