U.S. Adds Laptop Computers to Listing Of Products That Can Be Sold to Soviets

By Eduardo Lachica
The Wall Street Journal

August 15, 1989

WASHINGTON -- The U.S., at the urging of its allies, agreed to add laptops and other kinds of portable computers to the list of high-technology products that Western companies can freely sell to the Soviet bloc and China.

The Commerce Department announced last month that it was lifting export curbs on a wide class of desktop computers. But the order carrying out that decision adds not only laptops but other, more powerful versions of International Business Machines Corp.'s PS/2 line than the original announcement covered. The final order is to be published in the Federal Register today and will take effect today.

The original decision, announced July 18 by Commerce Secretary Robert Mosbacher, provoked a sharp reaction from Defense Secretary Richard Cheney, who told a news conference the following day that he didn't approve of that decision.

The Pentagon declined to comment to the latest ruling. A Defense Department official involved in export-control issues did acknowledge, however, that the Pentagon was aware that the Commerce Department's latest ruling would go beyond what it announced on July 18.

The new order says the revisions are the result of a review of the July decision by the Coordinating Committee for Multilateral Export Controls, or Cocom, the group through which the U.S. and 16 of its allies restrict trade in highly sensitive western technology. Some European governments wanted Cocom to go much further than what Mr. Mosbacher had announced, and the revisions appear to be a compromise satisfactory to all the Cocom governments for now.

Laptops and portable computers designed to take rough handling had been excluded at the Pentagon's insistence from the Commerce Department's preliminary order in July. That order did apply to a whole category of desktop computers, including the widely sold IBM AT models and their clones, freeing them from the need to get export licenses.

Japan stands to benefit from the latest revisions, because Toshiba Corp. and NEC Corp. are among the leading suppliers of laptops. Compaq Computer Corp. and Zenith Corp. also make laptops. Other types of portable computers designed for normal office use have been added to the list of liberalized products, but the military versions will continue to be banned for shipment to Soviet bloc countries and China.

By slightly modifying its technical standards, the new order adds the IBM PS/2 Model 50 and its clones to the list of desktops to be taken off the control list. The earlier decision drew the line at the PS/2 Model 30 and their equivalents. Both IBM models operate on Intel Corp.'s 80286 microprocessors, but the Model 50 can handle more sophisticated software.

The U.S. decision to remove controls from these products is based on a Commerce Department determination that equivalent models are freely exported by many non-Cocom countries, including Taiwan, India, China and Brazil.

The order retains the existing curbs on shipments to a number of countries that pose foreign-policy problems for the U.S., including Libya, Cuba and Vietnam. The final order also restricts shipment to military and police organizations and certain other types of consignees in Nicaragua, Panama and South Africa.

The order also clarifies what can't be shipped to the Soviet bloc. For instance, it retains strict controls on certain "stand-alone" graphic workstations, even if they are comparable in power to the liberalized desktops. The order also requires that the liberalized computers be shipped to the Soviet bloc as "complete systems," and not broken down into components that could be used for other than civilian purposes.

Credit: Staff Reporter of The Wall Street Journal