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NEWS - L.A. Bans Trade Ties to Burm
- Subject: NEWS - L.A. Bans Trade Ties to Burm
- From: Rangoonp@xxxxxxx
- Date: Fri, 18 Dec 1998 19:17:00
Subject: NEWS - L.A. Bans Trade Ties to Burma despite Federal Ruling
NOTE: It was a Federal District Court that has no affect on Los Angeles.
Rights-U.S.: L.A. Bans Trade Ties to Burma despite Federal Ruling
Inter Press Service
17-DEC-98
WASHINGTON, (Dec. 16) IPS - The Los Angeles City
Council, defying a recent federal court ruling and pressure
from big business, has voted unanimously to ban companies
that do business in Burma from bidding for city contracts.
Yesterday's 13-0 vote marked the latest development in an
ongoing battle between local human rights and
environmental activists and major U.S. and foreign
corporations over the legality of local and state ordinances
which penalize companies for doing business with
controversial governments abroad.
The city council's action, which takes effect in 30 days,
came
less than a month and a half after a federal court in
Massachusetts ruled that such measures -- referred to as
"selective purchasing" laws -- violate the Constitution,
which
grants the federal government exclusive control over foreign
affairs.
"State interests, no matter how noble, do not trump the
federal government's exclusive foreign affairs power," U.S.
District Court Judge Joseph L. Tauro ruled in a challenge to
a Massachusetts law requiring companies that do business
in Burma to add a 10 percent penalty to their bids for state
contracts.
That decision, the first against the selective-purchasing
laws
enacted by scores of city councils, states, and universities
during the anti-apartheid struggle in the 1980s, is now on
appeal. The issue is likely to be decided eventually by the
U.S. Supreme Court.
Judge Tauro's decision marked a major victory for a
coalition
of some 600 major U.S. and foreign corporations, the
National Foreign Trade Council (NFTC), which filed the
lawsuit against the Massachusetts law.
NFTC president Frank Kittredge told IPS today that the
group, which includes such heavyweights as General
Electric, Boeing and Exxon, considers the Los Angeles
ordinance as falling into the same category as the
Massachusetts law. But he said it was "too early to tell"
whether the group will take legal action.
"We think it's most unfortunate in light of all that's gone
on,"
he said, adding, "we still believe that such sanctions are
unconstitutional."
"This is a major defeat for the NFTC's campaign to get
selective-purchasing laws eliminated," said Simon Billeness,
an analyst at Franklin Research and Development
Corporation in Boston and a key organizer in the "Free
Burma" movement here.
It also marks a defeat for the European Union (EU), which
had submitted its own brief attacking selective-purchasing
laws in the Massachusetts case.
The EU and Japan have lodged complaints about such laws
with the World Trade Organization in Geneva, claiming that
they violate an international government-procurement
agreement which forbids the use of non-economic criteria in
awarding government contracts.
Los Angeles, the second largest U.S. city after New York,
will join a number of other jurisdictions around the country
in
applying selective-purchasing laws against Burma, whose
military regime has been accused of major violations of
human rights and drug trafficking.
In addition to Massachusetts, New York City, San Francisco,
Oakland, Portland (Oregon), and two dozen other towns and
cities have passed legislation penalizing companies which
do business in Burma. Selective-purchasing laws against
Nigeria, China and Cuba are also in effect in several towns
and cities.
Such laws were used with greatest success to punish South
Africa for its racist "apartheid" policies, where they were
credited with the exodus of scores of some of the United
States' biggest corporations, such as Coca-Cola, IBM and
General Motors.
Their withdrawal from South Africa is generally believed to
have played a critical role in persuading the country's
white
leaders to abandon apartheid.
Similar laws in New York, California, Pennsylvania and other
states and cities targeting Swiss banks and insurance
companies which had failed to account adequately to Nazi
Holocaust survivors and their families after World War II
helped prompt a settlement of outstanding claims last
August.
The Los Angeles ordinance, expected to be signed by
Republican Mayor Richard Riordan, is among the most
stringent. It bans companies which do business in Burma
from even bidding on the city's contracts -- hundreds of
millions of dollars worth are awarded each year.
The object of such legislation is to force corporations to
choose between their business in Burma and their stake in
lucrative government contracts in major U.S. jurisdictions.
"We are hopeful that this action will prove to be an
effective
tool in pressuring the Burmese Government to end its
repression of its people and move towards a democratic
government," council member Richard Alatorre said as he
explained his vote.
"The City of Los Angeles does not want its tax dollars going
to support companies who support widespread atrocities
which are now taking place in Burma," said council member
Jackie Goldberg.
"The regime in Burma is one of the most brutal in the world
and is supported by a small group of irresponsible
corporations," she added.
One Los Angeles-based company that had lobbied hard
against the ordinance issued a strong statement condemning
the council's action. Unocal, which has a major interest in
a
gas pipeline in Burma, charged that the council had "moved
beyond its legal authority."
Unocal, which has come under strong attack for its
operations in Afghanistan, as well as Burma, also noted that
the ordinance "sends an unwelcome message to the city's
trading partners in the Pacific Rim." The Association of
Southeast Asian Nations (ASEAN), it said, has condemned
such measures.
UNOCAL reportedly hired a full-time lobbyist to persuade the
council to abandon the effort. The NFTC also sent its
Washington lobbyists to the city to join the bid to kill the
measure.