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U.S. Says Lockheed Broke Rules on Chinese Rockets
By Jonathan Wright
WASHINGTON (Reuters) - The State Department has charged Lockheed
Martin Corp. with 30 violations of arms export regulations, some of
which could help China improve its rockets, a letter released on Thursday
said.
A spokesman for the company, which is based in Bethesda, Maryland,
disputed the charges, saying its actions, which took place in 1994,
were reasonable and consistent with its Department of Commerce license.
The company has 30 days to formally respond to the charges, which could
lead to a fine of $15 million and restrictions on arms export
licenses for three years.
The allegations were similar to those lodged in 1998
against
two other U.S. satellite makers, Hughes Electronics
Corp. and Loral Space & Communications, which have been
under criminal investigation for possibly passing
sensitive data to China.
U.S. conservatives hostile to the Chinese government have
cited the allegations as evidence that technical
cooperation with China is a danger to U.S. national
security.
In the letter, dated Tuesday and addressed to Lockheed Vice President
Richard Kirkland, the State Department's Office of Defense Trade
Controls alleged the company sent Asiasat, a Hong Kong-based satellite
company, the full version of a report on a Chinese-made
component known as a satellite perigee kick motor, including
recommendations for improving it. A kick motor fires after launch to send a
satellite into its final orbit.
The version sent to Asiasat was nearly 50 pages long, while the
expurgated version approved for export by the Defense Department was
about five pages, it added.
It said the full report identified flaws in Chinese testing methods, made
recommendations to improve procedures and standards, and
identified weaknesses in test instrumentation.
The report also violated the terms of Lockheed's export license by making
comparisons between the Chinese version of the motor and U.S.
versions, the letter said.
Lockheed did not tell the Pentagon it had provided 10 full versions to
Asiasat until the existence of those reports was recently discovered by
the U.S. Customs Service.
``Lockheed Martin Corp. made no effort to retrieve the 10 unexpurgated
assessments or seek to learn the ultimate disposition of these
assessments,'' the letter said.
Lockheed spokesman James Fetig said Asiasat was not a Chinese state
company at the time of the alleged violations, saying it was
two-thirds owned by a Hong Kong company.
Lockheed officials also said the company had a strict confidentiality
agreement with Asiasat that prohibited dissemination to firms or
government entities in China.
``There is absolutely no evidence that any information that we shared
under license from Asiasat ever reached any entity in the PRC
(People's Republic of China),'' Fetig said.
But the State Department letter said Asiasat's majority shareholder was
the China International Trust and Investment Corp., a Chinese
state-owned corporation.
``This is a dispute over the interpretation of that license. U.S. national
security was not harmed,'' Fetig said.
``This is an administrative and not a criminal proceeding and the alleged
violations are administrative in nature and not criminal,'' the
spokesman said.
State Department spokesman James Rubin, quoted in the Washington
Post, said, ``In our view, any assistance to China that enhances its
capabilities in space launch has the potential to be applied to missile
development.''
Export control officials decided to take action ``based on the facts and the
gravity of the charges,'' Rubin said.
The letter, summarizing the events of 1994, said that after the Chinese-
made kick motors failed many times in tests Lockheed offered to
help the manufacturer, China Great Wall Industries Company, evaluate
them.
Lockheed sent U.S. specialists to visit the rocket motor factory in the
Chinese town of Hohhot in August 1994 for a test firing and
discussions with the rocket company.
It violated its license by failing to give the U.S. government notice of the
visit 30 days in advance and by failing to ensure a Pentagon monitor
was present, the letter said.
-
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