1. Surveillance System Sale to China Pushed
  2. Rep.Lagomarsino Presses State Department for California Firm
  3. By JIM MANN
  4. Los Angeles Times
  5. 08/21/1989
  6. WASHINGTON — California Rep. Robert J. Lagomarsino (R-Ojai) has been urging the State Department to let a small California company sell custom-made television surveillance systems to China, where they could be used to keep watch on political dissidents.
  7. State Department officials say, and Lagomarsino confirms, that the congressman recently called Deputy Secretary of State Lawrence S. Eagleburger seeking a special waiver that would exempt the company, Quintron Systems Inc., from the Bush Administration's recent ban on the sale of military-related equipment to China.
  8. "It strikes me as absurd to be selling something like this to China at this point," commented one U.S. official familiar with Lagomarsino's request. "I can't imagine anything more offensive to a large number of Americans."
  9. In a telephone interview, Lagomarsino, a conservative Republican who is a senior member of the House Foreign Affairs Committee, told The Times that he sought to help the company because of its financial difficulties and that he did not realize the goods involved were surveillance systems.
  10. 'Didn't Know What It Was'
  11. "I knew it was some kind of electronic equipment, but I didn't know what it was," Lagomarsino said.
  12. "I just knew that it was an order for several million dollars [of goods) that they [Quintron] would not be able to sell elsewhere."
  13. Lagomarsino told The Times that he now plans to review the Quintron request to see if it involves goods that should not be sent to China.
  14. "It was my impression that this was low-technology equipment," he said. "It wasn't clear to me. I'll have to take another look at it."
  15. Eagleburger did not respond to requests for comment on Lagomarsino's efforts. One U.S. official explained that Eagleburger and other State Department officials want to avoid alienating Lagomarsino, who is the ranking Republican on the House Foreign Affairs subcommittee for Latin America.
  16. However, he and other U.S. officials said that they do not believe the exemption will be granted.
  17. In the weeks after China's People's Liberation Army launched its bloody assault on Tian An Men Square in Beijing in June, the Chinese regime began to air selective TV footage of the activities of student protesters taken by surveillance cameras on Beijing streets and inside buildings. The regime has long had surveillance cameras inside foreign diplomatic compounds.
  18. According to U.S. officials, the items Quintron wants to sell to China are being identified as "television monitors with sensitive optics components such as image intensifiers and converters." Because of the potential military use of such equipment, its sale to China or any other Communist country requires the approval of the State Department's Office of Munitions Control.
  19. In a telephone interview, Bryan E. Thompson, chairman and president of Quintron Systems, described the equipment at issue as a "surveillance television system."
  20. "Basically, what it's built for is surveillance of factories and that sort of thing," Thompson said.
  21. Made to Chinese Requirements
  22. He also said that his company has custom-designed the equipment for Chinese requirements but did not say what those requirements are. Quintron previously has done business overseas with South Korea and Saudi Arabia, he said.
  23. The Chinese enterprise to which Quintron is selling the surveillance systems is Poly Technologies Inc. U.S. officials have identified Poly Technologies as one of the two major Chinese trading companies that buy and sell arms for the Chinese armed forces. The firms are controlled by Chinese military leaders, and He Ping, president of Poly Technologies, is the son-in law of China's paramount leader, Deng Xiaoping.
  24. Material submitted to the State Department lists the final user of the TV surveillance systems as an organization called the Beijing Institute of Information, about which little is known.
  25. Thompson said he was told that Quintron's equipment will be used not by the Chinese government but by a university or research group. Chinese universities and research institutes are controlled by the ruling Communist Party.
  26. "Those things [the surveillance systems] can be used for only one purpose," said one State Department official, who said that he does not believe the request for a waiver by Lagomarsino and Quintron will be approved.
  27. Lagomarsino said he began trying to help Quintron obtain a waiver from the Bush Administration's restrictions on sales to China about three weeks ago.
  28. "They asked us to help them," he said. "... All I know is they represented to me that if they couldn't make the sale, they might go under."
  29. Quintron Systems is a small, privately held company in Santa Maria, in Lagomarsino's congressional district. According to Thompson, the company has 220 employees and sales of about $15 million a year.
  30. Thompson said that it would be "a disaster" if his company is not permitted to ship the surveillance cameras to China.
  31. He said that Quintron has signed a $2.125-million contract to sell the surveillance systems to China. The deal, the first the company has concluded with Beijing, was signed long before the bloody Chinese army crackdown on pro-democracy demonstrators last June 3-4. In response to that assault, President Bush ordered a suspension of all U.S. military sales to China.
  32. 'Timing Was Bad'
  33. "Our timing was bad," Thompson said mournfully. "These [Bush Administration] sanctions hit two weeks before the commodities were to be shipped. . . .
  34. "The problem is that these [surveillance] systems were custom made to Chinese requirements. They've been sitting on the dock since June 25, and we can't ship them.
  35. "We can't collect a penny until [the TV systems] get on board the ship," Thompson added. "We've borrowed money from the bank to handle the cash flow until we can ship."
  36. Both Lagomarsino and Thompson compared Quintron's request to one made earlier by Boeing Co. Last month, the State Department granted a waiver of the Bush Administration's sanctions to permit Boeing to sell four commercial jetliners to China. The navigation systems for those jets have potential military uses and therefore are on the State Department's munitions control list. ♦
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