Dubai Ports ... the lawyers and lobbyists smell money

The Port Authority of New York and New Jersey filed suit in a New Jersey Superior Court Friday to try to block Dubai Ports World, a company under Government control from the United Arab Emirates, from taking control of several United States ports. The Port Authority also sent a letter Friday to P&O asserting that the British company has violated its lease, which the authority now considers to be terminated. Citing security concerns, the Port Authority claimed that DP World violated its lease by not getting consent for its pending acquisition of Peninsular & Oriental Steam Navigation Co. (P&O), a London based company. The lawsuit asks the court to halt DP World's acquisition of P&O, and the court set a hearing date for March 3…. The day the deal was arranged to be completed.

After their normal Monthly meeting On Thursday, Port Authority Chairman Anthony Coscia said the U.S. Treasury Department had not responded to the bistate agency's request for details about how the federal government determined it was safe to allow Dubai Ports World to buy the British company.

"We as owners of that facility should be made comfortable that whoever operates that facility is capable of it," Coscia said.

The state of New Jersey has filed a federal lawsuit Thursday against the Bush administration, claiming that the administration's approval of DP World's acquisition encroaches on the sovereignty of the states in violation of the 10th Amendment to the US Constitution. The governors of New York and Maryland have also threatened similar court actions against the takeover.

In addition, Miami-based stevedoring company Eller & Co. asked London's High Court Friday to block DP World from taking over P&O by withholding court approval of the $6.8 billion takeover. DP World has volunteered to postpone its takeover while the Bush administration tries to convince lawmakers to support DP World's acquisition. Several senators have threatened to introduce legislation to block the deal and Sen. Carl Levin (D-MI) has said that administration's approval of the ports takeover was illegal ."Is there not one agency in this government that believes this takeover could affect the national security of the United States?" the Michigan Democrat asked at a Senate Armed Forces committee briefing. (see pic of Carl in Iraq)

Meanwhile, Dubai Ports World hired a team of lawyers to try to save the deal, including former US Sen. Bob Dole Dole, husband of Sen. Elizabeth Dole, R-N.C., (who opposes the deal) said he won't lobby Congress and will limit his involvement to discussions with Bush administration officials and efforts to "help the American people understand the real facts." (Should make for interesting times at breakfast in the Dole household)

To try to clarify matters Deputy Secretary of Treasury Robert Kimmitt insisted to the Senate Armed Sefvices committee that no national security concerns had been raised during a three-month review by the multiagency panel and said that the Bush administration interprets the statute as allowing discretion to decide whether to conduct an extended review. Kimmitt also said that the panel's decision to ratify the deal allowing DP World to takeover operations would only be reconsidered if the there is evidence that DP World officers provided false, inaccurate or misleading information during the review process.

Carl Levin, (more on his website) raising his voice at the briefing, told Kimmitt, "If you want the law changed, come to Congress and change it, but don't ignore it."

Kimmitt responded: "We didn't ignore the law. Concerns were raised. They were resolved."

Committee Chairman John Warner (R-VA) said that he would ask US Attorney General Alberto Gonzales to prepare a memorandum outlining the administration's interpretation of the law and Warner also cannily called for a separate review by the Senate's legal counsel.

Levin also questioned the UAE's past record on terrorism matters, saying the country backed the Taliban and allowed financial support for al-Qaida. He said the UAE has an "uneven history" as "one of only a handful of countries in the world to recognize the Taliban regime in Afghanistan." He added that millions of dollars in al-Qaida funds went through UAE financial institutions.

Levin at one point noted that a special commission that investigated the terror attacks against the United States on Sept. 11, 2000 concluded that "there's a persistent counterterrorism problem represented by the United Arab Emirates."

"Just raise your hand if anybody (at the witness table) talked to the 9-11 commission," commanded Levin. There was no response among the handful of administration representatives.

Former New Jersey governor, Republican Thomas H. Kean,who chaired the commission that examined the Sept. 11, 2001, attacks, has spoken aginst the port deal, telling the Associated Press "it should never have happened."

"We're in a no-win situation," Kean said, referring to the United Arab Emirates. "There's no question that two of the 9/11 hijackers came from there and money was laundered through there."

Bush, talking to reporters at the conclusion of a Cabinet meeting earlier Thursday, said that "people don't need to worry about security."

Under secret conditions of the agreement with the administration, the Dubai company promised to cooperate with U.S. investigations as a condition of the $6.8 billion deal, according to documents obtained by The Associated Press.

Critics in Congress, before Thursday's hearing, noted London-based P & O which previously operated these ports, is a publicly traded company while Dubai Ports World is effectively controlled by the government there. Sens. Robert Menendez, D-N.J., and Hilary Clinton have said they will introduce legislation to prohibit companies owned or controlled by foreign governments from running port operations in the United States.

In approving the purchase, the administration has not required Dubai Ports to keep copies of its business records on U.S. soil, and so, subject to orders by American courts. It also did not require the company to designate an American citizen to accommodate requests by the government.

Experienced legal experts claim such obligations are routinely attached to U.S. approvals of foreign sales in other industries.

One is left asking why, if the security of it’s ports was such a vital issue, some American capital wasn’t securing the realm…. Further disembowelling of the State. Unlike the rush into wind farms there aren’t sufficient tax credits in it.

No doubt about it , Dubya is slamming into a brick wall on this one.

.or as the Financial Times has it. "Big vision meets small minds".

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