For three months Dell Computer Corp has been unwittingly breaking US trade restrictions by selling its entire range of personal computers to Russia without export licences designating an end user. The fact Dell seems to have been unaware that it breaking any rules shows how careful Western suppliers must be to avoid making embarrassing mistakes. The US Bureau of Export Administration Enforcement Office says that based on the report in the industry newsletter Computer Business Russia, it has launched an examination into the Austin-based company’s Russian operation. We are initiating an investigation and will be sending a field agent to Texas, said agent Douglas McNeill from the Washington based Enforcement Office. Dell’s Russian master distributor appointed in April, Intermicro Business Systems, is selling the entire Dell range off the shelf in Moscow including computers that are more powerful than internationally agreed restrictions permit. Dell’s computers are being sourced from its plant in Ireland, which is not a member of CoCom, the Nato Co-ordinating Committee on Multi-lateral exports. It is this that has caused the situation to arise. Claire McGill, commercial attache at the Irish embassy in Moscow, says despite Ireland’s non membership of CoCom, its licensing policy has always shadowed the rules that organisation has laid down. To my knowledge there is no loophole making Ireland different. But if an Irish company has a licence to export it is equally difficult to see how they can be breaking (Irish) law, she told Computergram. But as a US company Dell is in breach of regulations issued by the US Departments of Commerce, Environment and Defence which demand that all computers over a certain speed sold to Russia by US companies must be first screened and approved by them. Intermicro is selling Dell personal computers based on Intel 80486DX2 50MHz and 80486DX2 66MHz processors from its Moscow warehouse without any form of end-user licence. At present CoCom export licensing regulations (and therefore the Departments of Commerce, Environment and Defence rules) demand that for exports to Russia any product containing an Intel Corp processor running faster than a 33MHz 80486 must first be cleared by the Commerce Department (14 days), get an Agency Review (14 days) and be granted a 40-day CoCom licence. This applies to the clock-doubler 80486s and the entire Pentium family. Intermicro’s commercial director, Sergy Matsotsky, confirmed to Computergram that his company was supplying all of the Dell range including 66MHz servers. If you like, you can come and take one today. But demand is so strong they will soon be gone, he told Computergram. The computers are shipped to Russia from Dell’s Eastern European operation in Warsaw, Poland.
Verbal assurance from the Irish
The regional manager responsible for Russia, Marek Lewicki, says because Dell Eastern Europe sources from Ireland it is not bound by the restrictions that would apply if it was shipping from Austin, Texas. But at the Dell plant in Limerick the traffic manager, who is responsible for export regulations, was as unsure of the situation as the Irish embassy. The licence we were given was an open book (licence) issued when we were not shipping to Eastern Europe and we are still not certain, he confirmed, adding that Dell Computer in Limerick had a verbal assurance from the Irish authorities that its existing licence was valid. It appears this lack of proper clarification from the Irish authorities allowed Dell to drift into breaking US export regulations. Above all the affair shows how nonsensical the CoCom restrictions have become. If a company finds itself able unwittingly to ship licensable equipment to Russia, clearly the controls cannot be effective in preventing anyone from buying restricted technology. The restrictions have reached the point of absolute absurdity. Personal computer manufacturer Zeos International Ltd has made it a policy to sell its Russian customers 33MHz computers that are upgradable for when restrictions are relaxed. This obvious
ly puts us at a competitive disadvantage which is both bad for us and bad for the business, says president Greg Herrick. Adding bitterly If the US government believes they are controlling something I have serious worries about my own country’s national security.
