Senators Collins, Lieberman, Coleman and Levin Express Concern over Sale of U.S. Port Operations to Dubai-Controlled Company

Senator Susan Collins, Chairman of the Senate Committee on Homeland Security and Governmental Affairs and Ranking Member Joseph Lieberman sent letters today to Department of Homeland Security Secretary Michael Chertoff and Department of Treasury Secretary John Snow expressing “serious concerns” with the proposed sale of operations at six major U.S. ports to Dubai Ports World (DPW), a company owned by the Dubai-government. The letter was also signed by Senators Norm Coleman (R-MN), Chairman of the Permanent Subcommittee on Investigations and Ranking Member Carl Levin (D-MI).

P&O has major container terminal operations in New York, Philadelphia, Baltimore, Miami, and New Orleans.

Following is the full text of the Senators’ letter to Secretaries Chertoff and Snow:

February 21, 2006

The Honorable Michael Chertoff
U.S. Department of Homeland Security
Washington, DC 20528

The Honorable John W. Snow
Department of Treasury
1500 Pennsylvania Ave., NW
Washington, DC 20220

Dear Secretary Chertoff and Secretary Snow:

We are writing to express our serious concerns regarding your review of the purchase of Peninsular and Oriental Steam Navigation Company by Dubai Ports World (DP World). As this transaction will result in the transfer of multiple terminal operations in major U.S. ports to a Dubai-government owned entity, it would seem to demand a more rigorous assessment, if not a full investigation. Even more significant is the historic use of the United Arab Emirates (UAE) as a base for terrorism financing and operations. Therefore, we ask that you provide a briefing to our Committee, as soon as possible, on the basis for the decision to allow this transaction to proceed.

As you know, Federal law requires that the President review the national security impact of foreign investments in the United States. The President has delegated this responsibility to the interagency Committee on Foreign Investment in the United States (CFIUS), headed by the Department of Treasury and including representatives of the Departments of Commerce, Defense, Homeland Security, Justice and State. Although any one of the member agencies may raise an objection to the acquisition, we understand that in the current case, no objection was raised. Additionally, the government can place conditions on the purchase. The briefing to our Committee should include the conditions that will be imposed upon DP World should the acquisition go forward. Please describe the Committee’s deliberations regarding the national security implications of this transaction.

While the United Arab Emirates (UAE) is a recognized partner in the war against terrorism, it is located in a highly sensitive region of the world for terrorist activity. Some of the 9/11 hijackers traveled to the United States from the UAE, where they were engaged in operational planning for the attacks. Much of the financing for the attacks was transferred through the UAE banking system.

It is critical to our national security that the government thoroughly review pending foreign investments in the United States. We believe that the Administration should be working more closely with Congress where acquisitions are of such a sensitive nature. In addition, we will be looking into the DHS role in the CFIUS process to ensure appropriate consideration of homeland security concerns.

Thank you for your response on this important matter.