According to an exclusive story in today’s Washington Times, the Validated End User Program implemented by the Department of Commerce’s Bureau of Industry and Security (“BIS”) may be terminated before the end of the Bush administration on January 20. Under that program, five companies in China were permitted to obtain from U.S exporters certain dual use items without export licenses that otherwise would have been required. As reported earlier on this blog, the program had come under criticism because two of the five validated end users had links to the Chinese military. The program had also come under fire because the Chinese government was not allowing U.S. investigators to have access to the facilities of the approved companies to verify that the exported items were not being diverted to the Chinese military.

An unidentified spokesman for the Commerce Department, who spoke to the Washington Times on condition of anonymity, said that the program could only be saved if the Chinese agreed to on-site inspections:

“This program will either be fixed or ended before Jan. 20,” the official said, adding that a decision will be made “in days, not weeks.”

China could avoid a suspension of the program by agreeing to U.S. demands for on-site inspections. The official said, however, that it does not appear likely that Beijing will make concessions before the Bush administration leaves office.

You have to wonder why BIS ever thought it would be able to engage in official inspections in foreign countries. Not surprisingly, most foreign countries are just a little touchy about the sovereignty issues raised by allowing foreign law enforcement officials to inspect facilities located on the foreign countries’ soil. Indeed, the Chinese had a history of interfering with efforts by the U.S., even before the Validated End User program was adopted, to determine whether items shipped under export licenses were used in the manner described in the export licenses.

UPDATE: BIS has issued a press release disputing the Washington Times article. The release states, among other things, that BIS has been able to conduct site-checks in China and is simply trying to formalize procedures for future site checks. It does concede that suspension of the program is a possibility if those procedures are not formalized.

[h/t to commenter jd]

Permalink


Copyright © 2008 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)