U.S. Fines Group of Firms $64,500 for Alleged Boycott Compliance

Jewish groups have expressed satisfaction that the Commerce Department is imposing a total of $64,500 in penalties on three affiliated biomedical firms for allegedly complying with the Arab economic boycott of Israel.

The fines amounted to $27,500 on Flow Laboratories International, $29,500 on its British affiliate and $7,500 on its California-based affiliate.

The department said that “although neither admitting nor denying the alleged violations, each agreed to pay the penalty.” All three companies were fined for having “allegedly agreed not to do business with Israel.”

The British affiliate allegedly refused to do business with Israel between April 1985 and February 1987. It also allegedly would not do business with companies blacklisted by the Damascus-based Arab Central Boycott Office in four transactions involving Saudi Arabia, Oman and the United Emirates, the department said.

Flow International was fined for allegedly barring its French and German affiliates from doing business with a pair of biomedical manufacturers in Israel.

The Anti-Defamation League of B’nai B’rith, which said it was “instrumental in bringing the allegations against Flow International to the attention of the Commerce Department’s Office of Antiboycott Compliance,” welcomed the fines.

Compliance with the Arab League boycott has been under closer scrutiny by American Jewish groups in the aftermath of the Persian Gulf War.

CONCERNS RAISED WITH COMMERCE DEPT.

Representatives of ADL, the American Jewish Committee and American Jewish Congress raised concerns about U.S. enforcement of anti-boycott laws in a meeting Tuesday with high-level Commerce Department officials.

They alleged the department had not imposed severe enough penalties on U.S. companies deemed to have complied with the boycott.

Commerce officials promised the department would review the question of penalty levels and try “expeditiously” to hire additional staff for its anti-boycott office, according to Jess Hordes, ADL’s Washington representative.

He said the groups learned that Commerce Secretary Robert Mosbacher has instructed his inspector general to investigate the department’s handling of a possible case against Baxter International of Deerfield, Ill., the world’s largest hospital supply company.

The department announced Feb. 27 that it had referred to the Justice Department possible criminal charges against Baxter for having allegedly sold an Israeli subsidiary to gain a contract with the Syrian army.

The Jewish officials had been scheduled to meet with Mosbacher himself, but he was unable to wait for their arrival. Instead, they met for close to an hour with five of his top aides.

Besides Hordes the Jewish delegation included Alfred Moses, chairman of the board of governors of AJCommittee; Paul Berger, senior vice president of AJCongress; Will Maslow, AJCongress general counsel and editor of its monthly Boycott Report; and Stuart Eizenstat, a former White House aide active on boycott issues.

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