Will Arab Deal Put U.S. Ports At Risk?

Congress, Bush At Odds Over Whether Security Is Being Compromised

(CBS/AP)  Members of Congress and the Bush administration are at odds over whether security is compromised by an Arab company's takeover of operations at six major American seaports.

Some lawmakers expressed concern Sunday that the safeguards are insufficient to thwart infiltration of the vital facilities by terrorists.

At issue is the purchase last week of London-based Peninsular & Oriental Steam Navigation Co., by Dubai Ports World, a state-owned business in the United Arab Emirates. Peninsular & Oriental runs major commercial operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

Homeland Security Secretary Michael Chertoff defended the U.S. security review of DP World in various television interviews Sunday.

"We make sure there are assurances in place, in general, sufficient to satisfy us that the deal is appropriate from a national security standpoint," Chertoff said on television.

But the United States' terms for approving the takeover of operations at six major American ports are insufficient to guard against terrorist infiltration, the chairman of the House Homeland Security Committee said Sunday.

"I'm aware of the conditions and they relate entirely to how the company carries out its procedures, but it doesn't go to who they hire, or how they hire people," Representative Peter King, a New York Republican, told The Associated Press.

"They're better than nothing, but to me they don't address the underlying conditions, which is how are they going to guard against things like infiltration by al Qaeda or someone else, how are they going to guard against corruption?" King said.

King spoke in response to Homeland Security Secretary Michael Chertoff's comments Sunday about conditions of the sale. King said he learned about the government's terms for approving the sale from meetings with senior Bush administration officials.

The government typically builds in "certain conditions or requirements that the company has to agree to make sure we address the national security concerns," he said on NBC's "Meet the Press," but added that details were classified.

New York Sen. Charles Schumer says President Bush should intervene.

Schumer says Bush should override approval for the deal and begin a 90-day investigation into U.S. port contracts that involve foreign governments.

CBS News correspondent Randall Pinkston reports critics point to the United Arab Emirates track record — it was the transfer point for nuclear components to Iran, North Korea and Libya, and the UAE's history as an operational and financial base for the hijackers who carried out the attacks of Sept. 11, 2001.

London-based Peninsular and Oriental Steam Navigation Co., was bought last week by DP World, a state-owned business. Peninsular and Oriental runs major commercial operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

Dubai Ports World has said it intends to "maintain and, where appropriate, enhance current security arrangements."

The UAE's foreign minister has described his country as an important U.S. ally in fighting terrorism. He noted that authorities there have handed over terror suspects to the U.S., including one who was wanted for the 2000 bombing of the destroyer USS Cole in Yemen. The UAE has also allowed the U.S. Air Force to operate from several bases in the country.

A Miami company, Continental Stevedoring & Terminals Inc., has filed suit in a Florida court challenging the deal. A subsidiary of Eller & Company Inc., Continental maintains it will become an "involuntary partner" with Dubai's government under the sale.

Michael Seymour, president of the North American arm of Peninsular & Oriental Steam Navigation, said in a statement that company lawyers would have to examine the lawsuit before he could comment on it.

He noted, however, that his company "is itself a foreign-owned terminal operator that has long worked with U.S. government officials in charge of security at the ports to meet all U.S. government standards, as do other foreign companies that currently operate ports in the United States."

"We are confident that the DP World purchase will ensure that our operations continue to meet all relevant standards in the U.S. through ongoing collaboration between the port operators and American, British, Australian and port security officials throughout the world," Seymour said.

Lawmakers from both parties questioned the sale as a possible risk to national security.

"It's unbelievably tone deaf politically at this point in our history," Republican Sen. Lindsay Graham said on "Fox News Sunday." "Most Americans are scratching their heads, wondering why this company from this region now," he said.

Sen. Barbara Boxer, a Democrat from California, told CBS' "Face the Nation": "It is ridiculous to say you're taking secret steps to make sure that it's OK for a nation that had ties to 9/11, (to) take over part of our port operations in many of our largest ports. This has to stop."