United States General Accounting Office

GAO Report to Congressional Requesters

November 1996 EXPORT CONTROLS

Sensitive Machine Tool

Exports to China

G O A

years

1921 - 1996

GAO/NSIAD-97-4

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-272257 

November 19, 1996

The Honorable Floyd D. Spence

Chairman, Committee on National Security

House of Representatives

The Honorable Frank Wolf

House of Representatives

On September 14, 1994, the Department of Commerce approved an export

of machine tools to China. These tools had been used at a plant in

Columbus, Ohio, that produced aircraft and missiles for the U.S. military.

The contractor, McDonnell Douglas Corporation, was closing the plant

and arranged for the sale of the tools to the China National

Aero-Technology Import and Export Corporation (CATIC) for use at the

CATIC Machining Center, a Chinese government-owned facility. The

machine tools were to be used to produce parts for commercial aircraft

that would be built in China under a contract with McDonnell Douglas.

However, some of the more sophisticated machine tools were shipped to

the Nanchang Aircraft Company, a facility that produces fighter aircraft

and cruise missiles for the People’s Liberation Army as well as civilian

products.

Concerned with whether the risk of a diversion was recognized and

appropriately dealt with during the export licensing process, you asked

that we review the circumstances surrounding the export of these items.

Specifically, we addressed the following issues:

• What are the military and civil applications of the equipment and are these

military applications important to China’s military modernization plans?

• What was the process for approving the licenses and how did the process

address the risks associated with this export?

• Were export control license conditions violated and, if so, what was the

U.S. government’s response?

Background Commerce is responsible for licensing exports of U.S. dual-use

items—items with both military and commercial applications—and helps

enforce controls over them. Depending on the item involved and the

country of destination, an exporter may be required to submit a license

application to Commerce to obtain government approval for the export.

The U.S. government controls the export of sophisticated machine tools

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for national security and nuclear nonproliferation reasons. Commerce, in

consultation with other agencies such as the Department of Defense

(DOD),1

 reviews license applications and makes licensing decisions.

Complex or sensitive export cases can be escalated to interagency export

licensing review committees for discussion and resolution. Commerce’s

Office of Export Enforcement, along with the U.S. Customs Service, is

responsible for ensuring adherence to license provisions by investigating

suspected export control violations and pursuing criminal and

administrative sanctions.

McDonnell Douglas and CATIC entered into an agreement in 1992 to

co-produce 40 MD-80 and MD-90 aircraft in China for the country’s

domestic “trunk” routes. A contract revision signed in November 1994

reduced the number of aircraft to be built in China to 20 and called for the

direct purchase of 20 U.S.-built aircraft. The four Chinese factories

involved in the Trunkliner program include the Shanghai Aviation

Industrial Corporation, Xian Aircraft Company, Chengdu Aircraft

Company, and Shenyang Aircraft Company. The Shanghai facility is

responsible for final assembly of the aircraft. All of these factories are

under the direction of Aviation Industries Corporation of China (AVIC) and

CATIC. CATIC is the principal purchasing arm of China’s military as well as

many commercial aviation entities.

In May 1994, McDonnell Douglas submitted license applications for

exporting machine tools to China. The machine tools were to be wholly

dedicated to the production of 40 Trunkliner aircraft and related work.

Under the Trunkliner program, the Chinese factories were responsible for

fabricating and assembling about 75 percent of the airframe structure and

the tools were required to produce parts to support the planned 10 aircraft

per year production rate.

The machine tools were to be exported to the CATIC Machining Center. At

the time the license applications were being considered, the Machining

Center did not yet exist. McDonnell Douglas informed the U.S. government

that the Machining Center would be located in Beijing and construction

would begin in October 1994. Aircraft parts production would start 

14 months later. McDonnell Douglas requested Commerce to approve

these applications quickly so that it could export the machine tools to

China, where they could be stored at CATIC’s expense until the new facility

1

The Defense Technology Security Administration, in consultation with the military services, is

responsible for developing DOD’s position on license applications.

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in Beijing was ready. Appendix I contains a chronology of key events

associated with the machine tools McDonnell Douglas exported to China.

Results in Brief The machine tools exported by McDonnell Douglas to China have military

and commercial applications. These machine tools had been used in the

United States to produce parts for military systems but were exported to

manufacture parts for commercial passenger aircraft. China needs

machine tools to upgrade both its military and commercial aircraft

production capabilities.

After a lengthy interagency review, the Department of Commerce

approved the license applications with numerous conditions designed to

mitigate the risk of diversion. During the review period, concerns were

raised about the need for the equipment to support Chinese aircraft

production, the reliability of the end user, and the capabilities of the

equipment being exported. Senior officials at Commerce, State, Energy,

DOD, and the Arms Control and Disarmament Agency agreed on the final

decision to approve these applications.

Some of these U.S. exported machine tools were subsequently diverted to

a Chinese facility engaged in military production. This diversion was

contrary to key conditions in the licenses that required equipment to be

used for the Trunkliner program and be stored in one location until the

CATIC Machining Center was built. Six weeks after the reported diversion,

Commerce suspended licenses for four machine tools not yet shipped to

China. Commerce subsequently denied McDonnell Douglas’s request to

allow the diverted machine tools to remain in the unauthorized location

for use in civilian production. Commerce approved the transfer of the

machine tools to the Shanghai aviation facility, which is responsible for

final assembly of Trunkliner aircraft. The diverted equipment was

relocated to Shanghai before it could be misused. Some of the amended

license conditions apply only after the equipment is installed, which has

not yet occurred. Commerce’s enforcement office did not formally

investigate the export control violations until 6 months after they were

first reported. The U.S. Customs Service and Commerce’s enforcement

office are now conducting a criminal investigation under the direction of

the Department of Justice.

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Machine Tools Have

Military and Civilian

Applications

Advanced machine tools have military and civilian applications and are

sought by China for industrial modernization efforts. The McDonnell

Douglas export license applications included 10 five-axis machines and 

2 coordinate measuring machines. (See table 1 for a list of the equipment

licensed for export.) The United States controls all these machines for

national security or nuclear nonproliferation reasons. China has limited

indigenous capability to produce comparable machine tools and,

therefore, relies primarily on foreign imports.

Table 1: McDonnell Douglas Machine

Tools Licensed for Export to China Equipment Quantity

Five-axis milling machines 4

Five-axis gantry profilersa 4

Five-axis numerical control machining center 2

Four-axis vertical profiler 1

Three-axis milling machine 5

Three-axis coordinate measuring machine 2

Hydraulic stretch press 1

Total 19

Note: McDonnell Douglas submitted license applications to export 32 machine tools, of which 19

were controlled and required individual licenses. The remaining machine tools were exported

under a general license.

aCommerce suspended the licenses for the gantry profilers after the reported diversion of some

machine tools to the Nanchang Aircraft Company. Gantry profilers are large machines that make

aircraft structural pieces such as wing spars.

The machine tools McDonnell Douglas exported to China had been used at

a U.S. government-owned plant to produce parts for the B-1 bomber, C-17

military transport aircraft, and the Peacekeeper missile. The more

advanced machine tools manufactured such items as military aircraft wing

structures, fuselage components, and landing gear and engine parts. For

example, five-axis machine tools simultaneously cut and form metal in five

different directions producing parts with minimal weight and maximum

strength, which improves aircraft performance (see fig.1).

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Figure 1: Five-Axis Machine Tool

McDonnell Douglas sold machine tools to China to manufacture parts for

commercial aircraft. All of these machine tools can manufacture

components for commercial aircraft and other products. For example, a

stretch press, which forms sheet metal around a three dimensional mold,

can form relatively large parts for aircraft fuselage sections and other

aircraft structures. Five-axis machine tools can also be used to make tools

and dies for auto body panels, medical and industrial equipment, and

molds for consumer products.

According to DOD, the Chinese government wants to buy five-axis machine

tools and related equipment to upgrade its military aerospace production

facilities2

 as well as its commercial aviation industry. China’s

modernization program has emphasized joint military-civilian production

and self-sufficiency through the acquisition of key Western dual-use

technologies.

2

China’s military modernization efforts reportedly include plans to coproduce Russian SU-27

aircraft—comparable to the U.S.-built F-15—and indigenously develop an advanced fighter aircraft

believed to be comparable to the U.S.-built F-16.

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China has had difficulty acquiring advanced machine tools because of

multilateral export controls. Until 1994, the United States and other

member countries of the Coordinating Committee for Multilateral Export

Controls tightly controlled the export of five-axis machine tools to China

and other countries. Such sales required prior notification and unanimous

consent from the other members. In March 1994, the Committee

disbanded, but former members agreed to continue controlling the export

of five-axis machine tools, but eliminated prior notification requirements.

Industry officials said that China has the capability to manufacture less

sophisticated machine tools, but cannot currently mass produce four- and

five-axis machine tools that meet Western standards.3

 However, they

noted that Japan, Germany, and other countries are marketing advanced

machine tools in China.

Risk of Diversion

Recognized and

Debated During

Licensing Process

Commerce approved the export applications with conditions after about 

3 months of interagency discussions and review. During this review

process, DOD officials raised several questions about the justification for

the export. Their concerns primarily focused on (1) whether the stated

end-use on the license applications justified the export; (2) the legitimacy

of the CATIC Machining Center, the stated end user of the equipment; and

(3) the quantity and capabilities of the machine tools. Prior to approving

the licenses, the reviewing agencies added numerous conditions to

mitigate the risks identified.

Applications Went Through

Interagency Review

Process

Commerce, State, Energy, DOD, and the Arms Control and Disarmament

Agency officials recognized the risk of diversion, considered it in their

deliberations, and added conditions to the licenses to minimize this risk.

The export applications were discussed, debated, and ultimately agreed

upon at senior levels at these agencies. Because of the significance and

complexity of the export, the case was immediately escalated to the

Advisory Committee on Export Policy (ACEP). ACEP is chaired by

Commerce and is composed of senior officials from Commerce, State,

Energy, DOD, and the Arms Control and Disarmament Agency. It provides a

forum for senior-level debate on significant export licensing issues.

McDonnell Douglas export applications were discussed and debated at

several ACEP meetings in the summer of 1994. Commerce and DOD were the

3

According to some industry officials, it will take China 5 to 10 years to mass produce five-axis

machine tools up to Western standards.

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primary agencies in the debate about these license applications.4 Many of

the questions raised at these meetings were subsequently addressed by

staff at Commerce, DOD, State, or Energy, often after requesting additional

information from McDonnell Douglas. To assist in the interagency

deliberations, the Central Intelligence Agency and Defense Intelligence

Agency were asked to provide additional information on Chinese

acquisition of machine tools and Chinese aviation facilities. The economic

impact on McDonnell Douglas of delaying or denying this export was also

considered during deliberations.5

DOD’s Defense Technology Security Administration distributed the

applications for comment to groups within the agency and throughout DOD.

Initially, the Navy, Air Force, Joint Chiefs of Staff, and Defense

Intelligence Agency raised strong objections or recommended denial of

these export applications. Senior officials in the agencies that initially

recommended denial eventually agreed to approve these licenses once

conditions were added. Several DOD officials noted that approving the

licenses with conditions was the best strategy for DOD since the licenses

would likely be approved at the ACEP. DOD began to consider what

conditions could mitigate the apparent risks almost immediately after

receiving the applications from Commerce in June 1994.

Commerce Argued the

Export Had a Low Risk of

Diversion

During the interagency discussions, Commerce officials argued the export

of the machine tools involved a low risk of diversion since McDonnell

Douglas officials were to be located at the CATIC Machining Center for at

least 4 years. They also believed that the machine tools were needed to

produce parts for Trunkliner aircraft in China. They noted that, according

to McDonnell Douglas officials, the machine tools were between 9 and 

26 years old, were not state-of-the-art equipment, and similar or more

capable machine tools could be purchased from foreign sources.

Commerce initially recommended that the applications be approved with

conditions restricting the end use to commercial aircraft production and

that McDonnell Douglas be required to provide a semi-annual certification

that this condition was being met. Commerce urged the other reviewing

agencies to act quickly on these licenses. McDonnell Douglas claimed that

4

The Department of Energy also reviewed the export license applications and determined that two

machines were of insufficient precision to raise nuclear proliferation concerns.

5

McDonnell Douglas said the machine tools were worth about $5 million. However, in 1993, CATIC

wrote a letter to McDonnell Douglas stating that “whether or not this procurement project will be

successful shall have a big influence on the Trunkliner programme and long term cooperation between

AVIC [a Chinese government defense industrial corporation] and MDC [McDonnell Douglas].” The

Trunkliner program was reportedly valued at about $1 billion.

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the Air Force was requiring it to vacate the plant in Ohio by July 5, 1994,

and it would be forced to pay high storage fees for the machine tools after

that date.6

Need for Machine Tools

Questioned

During the interagency review of the export applications, various DOD

officials commented that there was little justification supporting the need

for the export. Officials noted that the machine tools would provide

substantial excess production capacity to the Chinese aircraft industry

that could be directed toward satisfying military requirements. The

Defense Intelligence Agency reported that the machine tools represented

production capacity above and beyond the requirements necessary for

exclusive production of 40 Trunkliner aircraft. DOD also obtained limited

documentation indicating that CATIC asked other aircraft facilities in China

if they needed any of the machine tools from the Ohio facility.

DOD concerns were heightened in July 1994 when press reports noted that

the production of Trunkliner aircraft in China was to be reduced from 40

to 20 aircraft. During the summer of 1994, in response to questions from

DOD, McDonnell Douglas officials stated that they were discussing a

reduction to the Trunkliner program with CATIC. In August, however,

McDonnell Douglas assured DOD that it had “a firm binding contract for the

coproduction of 40 aircraft with CATIC that was agreed to and signed in

March 1992.”7

 In other correspondence, McDonnell Douglas noted that in

many cases the machines, including the five-axis machine tools, were

necessary to supply specific parts whether 1 or 100 aircraft were built.

Subsequent events indicated that not all of the exported equipment was

needed to support Trunkliner aircraft production. After some of the

machine tools were diverted to a Chinese military facility not involved in

the Trunkliner program, McDonnell Douglas submitted license

applications to Commerce to maintain the equipment at this facility to

manufacture parts for trainer aircraft and motorcycles. Although all the

equipment was eventually transferred to a facility involved in the

Trunkliner program, Chinese officials acknowledged they did not need the

stretch press.

6

According to Air Force officials, McDonnell Douglas determined the date it had to leave the plant and

was not charged storage fees until September 1994. McDonnell Douglas, in an August 1994 letter to

DOD, stated that “storage is running at $45,000 per month.” Beginning in September, the Air Force

charged the company about $7,500 per month for storage fees.

7

McDonnell Douglas and CATIC agreed in principle in May 1994 to amend the Trunkliner agreement. In

August 1994, the Secretary of Commerce acknowledged this agreement in a letter to a senior Chinese

government official and expressed hope that he could witness the signing of the amendment during his

upcoming visit that month.

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Concerns About the End

User Raised

DOD officials questioned the credibility of the end user of the machine

tools—the CATIC Machining Center.8

 This facility had not been built at the

time the license applications were deliberated.9

 Some officials cautioned

that the tools could be used at the CATIC Machining Center to manufacture

sophisticated parts for military-related systems. Officials also questioned

how these machine tools would be used after the Trunkliner program

ended.

Commerce officials told us that they had previously approved other

exports of machine tools for installation at factories not yet built.

Commerce officials said that they had done so because machine tools are

very large and are easier to install in a new building as construction

progresses. However, they could not readily provide us any specific

examples where this had been done. Commerce did not perform a

prelicense check10 on the CATIC Machining Center because it would not

have been useful since the facility had not yet been built.

Significance of Machine

Tools’ Capabilities

Questioned

Some DOD officials raised concern that the five-axis machine tools being

exported were highly capable and that the export of 10 five-axis machines

was a significant increase in capability over earlier exports. They noted

that the exported machine tools, though old, have long useful lives and

that an older machine tool may perform as well as a new one, even though

it may lack certain capabilities found in newer models.

U.S. government machine tool experts confirmed that machine tools have

long useful lives and can be easily upgraded with new electronics and

software and that many U.S. aerospace facilities use machine tools about

the same age as those exported to China. Shanghai aviation facility

officials said they are considering refurbishing and upgrading some of the

machine tools acquired from McDonnell Douglas. U.S. and foreign

companies offer refurbishing and upgrading services in China.

Conditions Added to

Mitigate Risks

The reviewing agencies added conditions to the licenses to address

national security concerns. (See app. II for a detailed list of these

8

According to Shanghai aviation officials, CATIC developed the concept of the Machining Center about

1993. Shanghai officials told CATIC they might not need the tools because a contract impasse with

McDonnell Douglas threatened to end the Trunkliner program.

9

A facility eventually was built at the location originally designated for the CATIC Machining Center.

10A prelicense check helps determine if the overseas purchaser can be considered a suitable recipient

of controlled U.S.-origin goods or technological data.

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conditions.) These conditions were designed to reduce or mitigate the risk

that the equipment would be diverted to an unauthorized location or be

used to manufacture parts with military applications. Specifically, the

license conditions

• required that the machine tools be stored in one location until the CATIC

Machining Center was constructed;

• restricted the use of the equipment to Trunkliner-related production;

• required assurances from CATIC that the equipment would be used as

stated;

• required metering devices to record equipment usage and the installation

of password protection on some equipment; and

• included various reporting requirements, such as quarterly inspection

reports by McDonnell Douglas, that were designed to monitor the

equipment and detect unauthorized use.

Commerce, DOD, State, Energy, and the Arms Control and Disarmament

Agency agreed to these conditions, and then Commerce obtained

concurrence from McDonnell Douglas before approving the licenses. Many

of these conditions were copied from prior export licenses for similar

equipment, while others were added to address concerns specific to this

export.

Problems With CATIC

Assurance

One of the conditions was that CATIC provide written assurance that the

Machining Center would not use the machine tools for military

applications and would use the equipment for Trunkliner-related

production. On September 13, 1994, one day before the licenses were

approved, U.S. Embassy officials sent Commerce and State a cable

reporting that they had met with and obtained the requested written

assurance from a senior CATIC official. However, the Embassy cable noted

that CATIC had not determined where it would build the Machining Center.

CATIC indicated that it may locate the Machining Center near Beijing at a

site to be determined or at the Hongxing aircraft company, which is

located in another city.11 Commerce officials could not provide

documentation on how this issue was addressed but said they discussed it

with McDonnell Douglas before approving the licenses. McDonnell

Douglas stated that it is aware of no evidence that Commerce officials

discussed this issue with its personnel. DOD officials stated that they did

not receive this cable.

11As noted above, McDonnell Douglas reported in its application material that the CATIC Machining

Center was to be located in Beijing and construction of the facility would begin in October 1994.

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U.S. Officials Generally

Believe Conditions Were

Effective

U.S. government officials stated that the conditions placed on the licenses

were effective in preventing the misuse of the machine tools. Commerce

and DOD officials noted that McDonnell Douglas’s inspection promptly

detected the diversion of the equipment. A senior Commerce official also

noted that the end-use assurances obtained as part of one condition

provided the U.S. government with the leverage needed to insist that the

diverted equipment be relocated to an acceptable facility before any

misuse of the equipment could occur.

During the licensing review process, some officials had questioned the

value of some conditions. For example, one condition called for

McDonnell Douglas personnel to report on the use of the equipment and

another condition called for metering devices to be installed on the

machine tools. One official had noted that McDonnell Douglas personnel

would only be able to determine that non-Trunkliner parts were being

produced, not whether these parts were for a military application or

simply another commercial product. Others had commented that metering

devices measuring usage may provide information on how long a machine

has been running but not what it is making.

Machine Tools Were

Diverted to a Chinese

Military Facility

Contrary to License

Conditions

The machine tools were shipped to three locations contrary to the license

conditions and CATIC’s assurances regarding end use. McDonnell Douglas

officials reported the diversion to the U.S. government after the company

had inventoried the equipment on March 24, 1995, in accordance with

license conditions. Six machine tools12 were diverted to the Nanchang

Aircraft Company, and the rest were stored in two locations in the port

city of Tianjin,13 near Beijing. (See fig. 2.) McDonnell Douglas officials

later visited Nanchang and reported that the stretch press had been

installed in a new building designed specifically for this machine.14 The

press, however, was not operational. In a letter to McDonnell Douglas,

Commerce indicated that the movement of the equipment to Nanchang

and partial installation of the stretch press was a “direct violation of the

12The six machine tools included one hydraulic stretch press, one five-axis machine tool, three

three-axis machine tools, and one coordinate measuring machine.

13CATIC officials informed McDonnell Douglas that they did not have enough room to store all the

machine tools at one location.

14U.S. Embassy officials did not visit the Nanchang Aircraft Company to verify the status of the

equipment because of Chinese government objections to U.S. post-shipment verification checks. For

additional information on Commerce’s prelicense/post-shipment verification program in China for

dual-use items, see Export Controls: Some Controls Over Missile-Related Technology Exports to China

are Weak (GAO/NSIAD-95-82, Apr. 17, 1995).

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conditions under which the equipment was originally authorized for

export to China.”

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Figure 2: Locations of Exported Machine Tools and Factories Engaged in Trunkliner Production

Shenyang

Beijing

Xi'an

Chengdu

Nanchang

Shanghai

Tianjin

China

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Under the terms of the export licenses and CATIC’s written assurance, the

machine tools were only to be used to manufacture commercial parts for

the Trunkliner and other McDonnell Douglas commercial aircraft.

However, the Nanchang Aircraft Company,15 which produces military and

commercial products, was not associated with these programs. Six weeks

after learning about the diversion, Commerce notified McDonnell Douglas

that the machine tools should be consolidated in a single storage facility in

Tianjin. Commerce also suspended four licenses for the equipment that

had not yet been shipped to China. This equipment included four gantry

profilers that CATIC bought from McDonnell Douglas but temporarily

leased to a supplier in New York.

Commerce Denied Request

to Keep Machine Tools in

Nanchang

On August 1, 1995, McDonnell Douglas submitted four license applications

requesting that the six machine tools at the Nanchang Aircraft Company

be authorized for use at that facility. Commerce subsequently denied three

of these license applications covering the five-axis and three-axis machine

tools and coordinate measuring machine. They were denied because

(1) the transfer of equipment to Nanchang and installation of one item

violated conditions placed on the original export license applications and

(2) U.S. officials were concerned that the equipment installed at the

Nanchang facility could be diverted to military programs.

Commerce returned the fourth Nanchang license application for the

stretch press to the company without action. Commerce officials said that

they should have denied this license application along with the other

three. Officials explained that the license application for the stretch press

was processed separately because the stretch press was controlled for

different reasons. As a result, different technical staff reviewed these

applications.

Commerce Approved

Amended Licenses

Transferring Equipment to

Shanghai

In October 1995, McDonnell Douglas submitted 12 export license

amendments requesting that all the exported equipment, now located in

Tianjin and Nanchang, be transferred to the Shanghai aviation facility.

Commerce officials urged quick approval of the amendments so that the

equipment could be moved to a single location to manufacture parts for

the Trunkliner program.

15The Nanchang Aircraft Company produces military and civilian aircraft, cruise missiles, and

commercial products such as motorcycles.

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The amended license applications were discussed over several months at

interagency government meetings. According to senior Commerce

officials, it took time to process the amended licenses partly because they

wanted to ensure that the Shanghai facility was an acceptable location to

transfer the equipment.16 In response to officials’ questions, McDonnell

Douglas indicated the facility had a very small inventory of advanced

machine tools and needed the exported equipment to complete its

requirements for the Trunkliner program. McDonnell Douglas officials also

assured government officials that they had 14 U.S. personnel on site at the

Shanghai facility and could monitor the equipment.

The reviewing agencies agreed in February 1996 that the 12 export license

amendments, permitting transfer of all the exported equipment to the

Shanghai facility, should be approved with certain conditions. The

conditions were similar to those incorporated in the original export

licenses. A new condition was added specifying that all equipment must be

placed or stored at the Shanghai facility within 120 days after license

approval17 and that McDonnell Douglas would report on the location of the

machine tools until they were made operational.

Equipment Now Reported

in Shanghai

McDonnell Douglas and U.S. Embassy officials reported that the diverted

machine tools were now at the Shanghai aviation facility. On January 31,

1996, McDonnell Douglas advised Commerce that all of the equipment

except the stretch press had been moved from Nanchang to Shanghai.18 In

April 1996, about 1 year after the diversion was first reported, a U.S.

Embassy official confirmed that all the machine tools except the stretch

press were in Shanghai.19

On August 9, 1996, we toured the Shanghai aviation facility and saw the

stretch press, which plant officials said had arrived from Nanchang several

days earlier. Shanghai officials informed us that they already had two

16Discussion of the amendments also occurred over a 3-week government furlough, which interrupted

the processing of the amended licenses.

17In June 1996, McDonnell Douglas requested, and Commerce authorized, an additional 60 days to

move the stretch press from the Nanchang Aircraft Company to the Shanghai facility. Commerce

granted this extension subject to McDonnell Douglas providing biweekly status reports on the

movement of the stretch press.

18The equipment was moved about 1 week before the U.S. government approved the amended licenses

authorizing the transfer to Shanghai.

19The machine tools were stored in over 100 crates. The Embassy official was unable to inspect every

crate but did confirm that the crates contained small and large parts of all the exported machine tools

except the stretch press.

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presses and had no plans to use this newly acquired stretch press.

Commerce and McDonnell Douglas discussed the possibility of finding an

alternate end user for the stretch press when the press was located in

Nanchang,20 but DOD objected, insisting that the press be moved to

Shanghai before considering another end user.

Some License Conditions

Will Not Apply Until

Equipment Is Installed

A number of the amended license conditions will only apply after the

equipment is installed at the facility. For example, metering devices, which

measure operating time, must be read and logged daily once the

equipment is installed. Shanghai aviation officials said that most of the

tools will remain crated until a new machining center is completed at the

Shanghai facility. During our visit, Shanghai officials showed us a new

building they were constructing specifically to house the exported

machine tools. (See fig. 3.) The building was planned for completion in

September 1996. Shanghai officials said that the first MD-90 aircraft for the

Trunkliner program is scheduled for delivery in April 1998.

Figure 3: Machining Center Under

Construction at the Shanghai Aviation

Industrial Corporation

20In March 1996, a Commerce official contacted a U.S. aircraft company about the possible use of the

stretch press for commercial helicopter component manufacturing in China.

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Commerce Began

Investigation 6 Months

After the Reported

Diversion

Commerce’s Office of Export Enforcement, which is responsible for

investigating export control violations, did not formally investigate the

machine tool diversion until 6 months after McDonnell Douglas reported

the incident. McDonnell Douglas first briefed Commerce and other

government officials on the status of the equipment in the spring and then

again in the fall of 1995. In response to questions raised in a

September 1995 interagency discussion about the diversion, a Commerce

official indicated that the enforcement office was investigating the matter.

However, the enforcement office initiated its investigation only after DOD

formally requested such action in October 1995. The enforcement office

referred the investigation to its Los Angeles Field Office in

November 1995. A senior official said that they did not investigate sooner

primarily because corrective action could be taken through the licensing

approval process by suspending the licenses or modifying them to request

assurances or movement of the equipment.

Based on its preliminary investigation, the Los Angeles Field Office wrote

a report recommending that Commerce issue a temporary denial order

against CATIC and its subsidiaries. A temporary denial order would have

denied CATIC all U.S. export privileges. The Office of Export Enforcement

headquarters rejected this recommendation because it concluded that the

evidence in the report did not meet standards necessary to issue such an

order as set forth in the Export Administration Act. Officials explained

that a temporary denial order is used to prevent an imminent violation of

export control law rather than punish a past violation. The Los Angeles

Field Office subsequently referred the case to the Department of Justice

for consideration. The U.S. Customs Service and the Office of Export

Enforcement are now conducting an investigation under the direction of

the Department of Justice.

Agency and Company

Comments

In commenting on the draft of this report, DOD and the Departments of

Commerce and State generally agreed with our findings. (See apps. III, IV,

and V, respectively.) Each of these agencies also provided technical

comments, which we have incorporated in the text where appropriate.

McDonnell Douglas also provided comments on the report. McDonnell

Douglas stated that it would consent to public release of information on

export licenses protected by section 12(c) of the Export Administration

Act if their comments were printed in the report. McDonnell Douglas

commented that (1) the U.S. government knew that the Trunkliner

program might be reduced, (2) all of the machine tools were needed for

Page 17 GAO/NSIAD-97-4 Export Controls
B-272257 

the Trunkliner program, and (3) McDonnell Douglas was under pressure to

vacate the Columbus, Ohio, plant in the summer of 1994. After carefully

reviewing their comments, as well as evidence we obtained from other

sources, we have determined that no change was needed in our report.

McDonnell Douglas’s comments are reprinted in their entirety in appendix

VI, along with our evaluation of them.

Scope and

Methodology

To assess the civil and military capabilities of the machine tools, we met

with and reviewed analyses performed by officials at the Defense

Intelligence Agency, Central Intelligence Agency, Defense Technology

Security Administration, the Air Force’s National Air Intelligence Center,

and the Department of Commerce. We also visited the Defense Logistics

Agency’s refurbishing center for machine tools in Pennsylvania and

McDonnell Douglas’s Long Beach, California, facility. Our report only

contains limited information on the military significance of this equipment

because much of the information is classified.

To assess the export licensing process and compliance with license

conditions, we developed a detailed case history covering what

information was available to decisionmakers, the accuracy of this

information, the reasoning behind the decisions that were made, and the

actions taken by parties involved in this export. We interviewed officials at

all levels at DOD, the Departments of Commerce and State, and the Central

Intelligence Agency who had provided information and analyses or

participated in the decision-making process of the original and amended

licenses. These included officials at Commerce’s Bureau of Export

Administration, the Defense Technology Security Administration, the Air

Force, the Navy, the Office of the Joint Chief of Staff, the Defense

Intelligence Agency, and the National Photographic Interpretation Center.

We reviewed memorandums, correspondence, e-mail communication, and

studies that pertained to these licenses as well as the case files

themselves. We also met with State Department, Foreign Commercial

Service, and Defense Attache officials at the U.S. Embassy, Beijing and

visited the Shanghai Aviation Industrial Corporation in Shanghai. We

attempted to ensure the accuracy of information by corroborating it with

multiple sources.

Because of the ongoing Department of Justice investigation, we did not

interview McDonnell Douglas officials who were directly involved in the

sale of the equipment, the licensing process, or the performance of

inspections in China. Moreover, our request to meet with the Office of

Page 18 GAO/NSIAD-97-4 Export Controls
B-272257 

Export Enforcement investigator on this case was not approved. Our

contact with McDonnell Douglas was limited to meetings with legal and

technical staff in Long Beach on the capabilities of the machine tools. A

McDonnell Douglas official was also present during our discussion with

Shanghai Aviation officials. McDonnell Douglas did provide us with a

written chronology covering its contacts with the U.S. government. This

information was supplemented with information on the Trunkliner

program and other related subjects. We did not attempt to meet with CATIC

officials.

We performed our review from March to October 1996 in accordance with

generally accepted government auditing standards.

As agreed with your offices, unless you publicly announce the contents of

this report earlier, we plan no further distribution of this report until 

10 days after its issue date. At that time, we will send copies of this report

to other interested congressional committees; the Secretaries of

Commerce, Defense, and State; and the Director, Office of Management

and Budget. We will also make copies available to others upon request.

Please contact me at (202) 512-4383 if you have any questions concerning

this report. Major contributors to this report are listed in appendix VII.

Katherine V. Schinasi

Associate Director

Defense Acquisitions Issues

Page 19 GAO/NSIAD-97-4 Export Controls
Contents

Letter 1

Appendix I 

Chronology

Concerning Licenses

for Machine Tools

Exported to China

22

Appendix II 

Conditions for

Exporting Machine

Tools to the CATIC

Machining Center

24

Appendix III 

Comments From the

Department of

Defense

27

Appendix IV 

Comments From the

Department of

Commerce

28

Appendix V 

Comments From the

Department of State

33

Appendix VI 

Comments From

McDonnell Douglas

35

Page 20 GAO/NSIAD-97-4 Export Controls
Contents

Appendix VII 

Major Contributors to

This Report

40

Table Table 1: McDonnell Douglas Machine Tools Licensed for Export

to China

4

Figures Figure 1: Five-Axis Machine Tool 5

Figure 2: Locations of Exported Machine Tools and Factories

Engaged in Trunkliner Production

13

Figure 3: Machining Center Under Construction at the Shanghai

Aviation Industrial Corporation

16

Abbreviations

ACEP Advisory Committee on Export Policy

AVIC Aviation Industries Corporation of China

CATIC China National Aero-Technology Import and Export

Corporation

DOD Department of Defense

Page 21 GAO/NSIAD-97-4 Export Controls
Appendix I 

Chronology Concerning Licenses for

Machine Tools Exported to China

6/93 McDonnell Douglas met with the Department of Commerce to discuss the possible sale and

export of surplus equipment and machinery located at the plant in Columbus, Ohio.

9/30/93 China National Aero-Technology Import and Export Corporation (CATIC) sent a letter to

McDonnell Douglas stating that whether the procurement of equipment from Columbus “is

successful shall have a big influence on the trunk liner programme and long term cooperation”

between the Aviation Industries Corporation of China, a Chinese government defense industrial

corporation, and McDonnell Douglas.

12/23/93 CATIC agreed to purchase some of the surplus equipment from the Columbus, Ohio, facility.

2/18/94 Agreement for sale of equipment in the Columbus facility to CATIC was executed.

5/94 McDonnell Douglas and CATIC agreed in principle to amend the Trunkliner agreement.

5/26/94 McDonnell Douglas submitted 24 export license applications for export to China of the

equipment purchased from the Columbus, Ohio, facility.

7/20/94 News article reported the shifting of the production of 20 Trunkliner aircraft from China to the

United States.

8/12/94 The Secretary of Commerce sent a letter to the Chinese Vice Premier of the State Council

regarding the amendment to the Trunkliner program.

9/1/94 Commerce issued formal notices that eight of McDonnell Douglas’s applications were being

returned without action because the equipment did not require an individual validated license

for export to China.

9/13/94 Embassy officials in China sent a cable indicating receipt of written assurance from CATIC and

noted that CATIC had not yet decided whether to locate the Machining Center near Beijing at a

site to be determined or at the Hongxing Aircraft Company.

9/14/94 Commerce issued 16 export licenses for export of the Columbus, Ohio, equipment to China.

One license condition required the equipment be stored in one location until it was installed at

the CATIC Machining Center.

9/29/94 McDonnell Douglas and CATIC reached initial agreement to amend the contract to produce 20

aircraft in Long Beach, California, and 20 aircraft in China.

11/4/94 McDonnell Douglas and CATIC reached a final agreement to modify the original Trunkliner

agreement so that the first 20 aircraft would be produced in Long Beach, California with the

remaining 20 aircraft to be produced in China.

11/12/94 - 2/18/95 The equipment covered by 12 of the 16 export licenses was shipped to China.

3/24/95 McDonnell Douglas officials investigated the location of the equipment in China and

discovered that six pieces were stored at the Nanchang Aircraft Company and that the

remainder was stored in Tianjin, China.

4/4/95 McDonnell Douglas submitted a written report to Commerce and the Department of Defense

(DOD) informing them of the results of its March 24, 1995, investigation.

4/20/95 McDonnell Douglas briefed a U.S. government interagency group on the location of the

equipment in China, advising Commerce that CATIC’s plans to build a new factory in Beijing

had not materialized.

8/1/95 McDonnell Douglas submitted export license applications requesting permission to allow the

equipment diverted to Nanchang to remain at the Nanchang Aircraft Company.

8/23/95 McDonnell Douglas reported to Commerce by telephone that it had discovered after visiting

the Nanchang facility that the stretch press at Nanchang had been uncrated and placed inside

a building, but the press was not operational and the building had no electricity.

(continued)

Page 22 GAO/NSIAD-97-4 Export Controls
Appendix I 

Chronology Concerning Licenses for

Machine Tools Exported to China

9/28/95 McDonnell Douglas was told that Commerce would not permit transfer of the equipment at

Nanchang to the Nanchang Aircraft Company.

10/95 McDonnell Douglas submitted 12 export license amendment requests to permit all the

equipment in Tianjin and Nanchang to be transferred to the Shanghai Aviation Industrial

Corporation in Shanghai.

10/4/95 DOD sent a memorandum to Commerce asking for the diversion to be investigated.

11/7/95 Commerce’s Office of Export Enforcement initiated official investigation.

11/28/95 Commerce’s Los Angeles Field Office sent its investigative report to Commerce and

recommended a temporary denial order against CATIC, suspending its export privileges.

Commerce’s Office of Export Enforcement returned the recommendation, citing insufficient

evidence.

1/31/96 McDonnell Douglas advised the Department of Commerce that five of the six machines at

Nanchang Aircraft Company had been moved from Nanchang to the facility in Shanghai.

2/3/96 Commerce denied three of the four export license applications filed by McDonnell Douglas on

August 1, 1995, requesting approval to transfer the equipment in Nanchang to Nanchang

Aircraft Company; the fourth, pertaining to the stretch press, was returned to the applicant

without action.

2/6/96 Commerce approved with conditions the 12 export license amendment requests filed by

McDonnell Douglas in October 1995, permitting transfer of all the equipment to the Shanghai

Aviation Industrial Corporation in Shanghai.

2/10/96 McDonnell Douglas inspected the one piece of equipment, the stretch press, remaining in

Nanchang and observed that, although it was partially assembled, it was not connected to

either electrical or hydraulic power sources and was not operational.

3/96 Commerce contacted a U.S. aircraft company about the use of the stretch press for

commercial helicopter component manufacturing in China.

4/23/96 A U.S. Embassy official visited the Shanghai aviation facility and inspected the crated machine

tools.

4/29/96 A McDonnell Douglas letter sent to Commerce reported that the machines at the Shanghai

aviation facility were in their original crates or were being removed and installed.

6/7/96 Commerce granted McDonnell Douglas’s request to extend the time authorized to move the

stretch press from 120 to 180 days.

6/21/96 A McDonnell Douglas letter confirmed that two pieces of the stretch press had arrived in

Shanghai.

8/5/96 The remaining pieces of the stretch press arrived at the Shanghai aviation facility.

8/9/96 GAO toured the Shanghai aviation facility and observed the stretch press and a new building

being constructed reportedly to house the machine tools.

Page 23 GAO/NSIAD-97-4 Export Controls
Appendix II 

Conditions for Exporting Machine Tools to

the CATIC Machining Center

Commerce placed 14 conditions on the export of McDonnell Douglas

machine tools to CATIC. Later, it subsequently approved relocating the

equipment to the Shanghai aviation facility with similar conditions.

1. The only parts programs authorized to be loaded and run in the

numerical control device are those authorized for “Trunkline” aircraft and

“offset” from McDonnell Douglas project as negotiated with McDonnell

Douglas Corporation.

2. Where applicable, the numerical control device (machine control unit)

must be modified to provide password protection. Password access is

granted to authorized personnel only for authorized parts.

3. The machine tools approved for export must be installed at the CATIC

Machining Center. McDonnell Douglas must provide written certification

of delivery and installation to Commerce. Should the CATIC facility not be

ready when the equipment arrives, the equipment will be stored in one

facility. That facility will be subject to the inspection requirements stated

in condition no. 5. McDonnell Douglas will notify the U.S. government of

the location of the machine tools and notify it if the equipment is moved

before the plant is completed.

4. The machines must have a metering device that measures operating

time (e.g., a Hobbs Meter). The elapsed operating time will be read and

logged into a production logbook on a daily basis. The logbook will be

furnished to DOD and the Office of Export Enforcement on a quarterly

basis.

5. After installation of the machines, McDonnell Douglas must submit

quarterly reports for the next 2 years to the Office of Export Enforcement

and DOD. The reports must include information as to whether the

equipment is still being used for the purposes approved under the

conditions of the licenses, and any discrepancies must be noted in the use

of the timing device, password, or other security requirements. A

McDonnell Douglas representative will have the right of access to inspect

the equipment at any time, wherever located, during normal working

hours and whenever the equipment is in operation. Should McDonnell

Douglas wish to withdraw its personnel, it must notify the U.S.

government well in advance. As agreed with arrangements with the

Chinese government, a U.S. government representative will conduct a

post-shipment verification visit to the facility after the equipment is

installed.

Page 24 GAO/NSIAD-97-4 Export Controls
Appendix II 

Conditions for Exporting Machine Tools to

the CATIC Machining Center

6. None of the equipment may be resold, transferred, or reexported

without prior written approval from the U.S. government.

7. This equipment is licensed exclusively for the civilian use of

implementing the MD80/90 series McDonnell Douglas design for the

development of the Chinese Trunkline and offset from McDonnell

Douglas.

8. The equipment will not be used by or for military or nuclear end users

or uses.

9. These licenses do not authorize transfer of technical data other than

that required for normal maintenance, repair, and operation of the

equipment. Note: The export of McDonnell Douglas proprietary data

concerning plant layout for the manufacture of MD80/90 airframe parts

may require an individual validated license under the provisions of the

export administration regulations.

10. McDonnell Douglas must inform the end user of all conditions.

11. The licenses will be approved only after senior CATIC officials provide

assurance that these machines will be used only by the end user for the

end uses specified in these licenses.

12. Employees of or contractors to McDonnell Douglas who visit the CATIC

facility will report on the use of the equipment as observed during their

visits. Such reports will be available to Commerce. Those who observe

unauthorized use of the equipment must report these discrepancies

immediately to Commerce.

13. No parts produced by this equipment that are on the U.S. commodity

control list for national security or nuclear nonproliferation reasons can

be exported by CATIC to Libya, Cuba, or North Korea (country groups S or

Z).

14. McDonnell Douglas must advise the U.S. government of any changes in

the negotiated contract for 40 Trunkline aircraft. Notification must include

any increase or reduction in aircraft or offset production requirements. If

the McDonnell Douglas Trunkline contract is renegotiated below 40

aircraft, these machine tools could still only be used to produce parts for

the Trunkline aircraft and McDonnell Douglas offsets. Any machining

capacity freed up by a reduction in the production requirements will be

Page 25 GAO/NSIAD-97-4 Export Controls
Appendix II 

Conditions for Exporting Machine Tools to

the CATIC Machining Center

viewed as excess capacity by the U.S. government and considered in any

future Chinese machine tool licensing actions.

Page 26 GAO/NSIAD-97-4 Export Controls
Appendix III 

Comments From the Department of Defense

Page 27 GAO/NSIAD-97-4 Export Controls
Appendix IV 

Comments From the Department of

Commerce

Page 28 GAO/NSIAD-97-4 Export Controls
Appendix IV 

Comments From the Department of

Commerce

See comment 1.

Now on pp. 14 and 23.

See comment 2.

Now on p. 17.

See comment 2.

Page 29 GAO/NSIAD-97-4 Export Controls
Appendix IV 

Comments From the Department of

Commerce

Now on p. 17.

See comment 2.

Now on p. 10.

Now on p. 11.

See comment 3.

See comment 4.

Page 30 GAO/NSIAD-97-4 Export Controls
Appendix IV 

Comments From the Department of

Commerce

See comment 5.

Now on p. 19.

See comment 5.

Page 31 GAO/NSIAD-97-4 Export Controls
Appendix IV 

Comments From the Department of

Commerce

The following are GAO’s comments on the Department of Commerce’s

letter dated October 11, 1996.

GAO Comments 1. The report accurately notes that the equipment was relocated before it

was misused. The diversion of the machine tools to Nanchang, a facility

engaged in military production, does not support Commerce’s statement

that concerns over the military utility of this equipment was overstated.

The Chinese were only able to partially install the stretch press and did not

uncrate the other equipment because the diversion was discovered.

2. We have modified the text of the report to address this comment.

3. We agree that a court of law may ultimately examine whether a legal

violation occurred and who was responsible and have modified the report

accordingly. However, Commerce, in a letter to McDonnell Douglas,

indicated that the movement of the equipment to Nanchang and the partial

installation of the stretch press was a “direct violation of the conditions

under which the equipment was originally authorized for export to China.”

4. Commerce stated that its top priority was to quickly relocate the

equipment to an acceptable facility. As discussed in our report, all the

equipment was relocated to an approved facility about 17 months after the

diversion was first reported. Commerce also noted in its comments that it

needed to continue the investigation in a way that did not adversely affect

cooperation from McDonnell Douglas. As discussed in our report,

Commerce’s enforcement office did not begin an official investigation until

6 months after the reported diversion and only after requested by DOD.

During this time, Commerce’s licensing group worked with McDonnell

Douglas on export license amendments to transfer the equipment to an

acceptable facility.

5. This report is not restricted by section 12(c) of the Export

Administration Act. McDonnell Douglas consented to waive its

confidentiality rights under section 12(c) with respect to the information

contained in this report.

Page 32 GAO/NSIAD-97-4 Export Controls
Appendix V 

Comments From the Department of State

Now on p. 6.

See comment 1.

Now on p. 7.

See comment 2.

Page 33 GAO/NSIAD-97-4 Export Controls
Appendix V 

Comments From the Department of State

The following are GAO’s comments on the Department of State’s letter

dated October 21, 1996.

GAO Comments 1. We made changes to the report to clarify that five-axis machine tools

were controlled by the Coordinating Committee for Multilateral Export

Controls to other countries in addition to China.

2. We made changes to the report to reflect State’s comments.

Page 34 GAO/NSIAD-97-4 Export Controls
Appendix VI 

Comments From McDonnell Douglas

See comment 1.

Page 35 GAO/NSIAD-97-4 Export Controls
Appendix VI 

Comments From McDonnell Douglas

See comment 1.

Now on p. 8.

See comment 2.

See comment 3.

Page 36 GAO/NSIAD-97-4 Export Controls
Appendix VI 

Comments From McDonnell Douglas

Now on p. 8.

See comment 4.

Now on p. 8.

See comment 5.

See comment 1.

Page 37 GAO/NSIAD-97-4 Export Controls
Appendix VI 

Comments From McDonnell Douglas

The following are GAO’s comments on McDonnell Douglas’s letter dated

November 12, 1996.

GAO Comments 1. McDonnell Douglas makes this generalized statement several times in

its letter. However, we have carefully reviewed its specific comments as

well as the evidence we obtained from multiple sources and continue to

believe that the presentation in the report is accurate.

2. Although the amendment to the Trunkliner agreement was signed in

November 1994, Commerce documents clearly indicate that an agreement

in principle to amend the contract had been reached as early as May 1994.

DOD licensing officials first learned of the possible reduction in the

Trunkliner program in July 1994 from press reports, not McDonnell

Douglas. However, McDonnell Douglas in an August letter to DOD, assured

DOD that it had a firm binding contract for the coproduction of 40 aircraft.

3. The reduction in the number of aircraft to be built in China is relevant to

CATIC’s need for the machine tools. The amendment to the Trunkliner

agreement calling for the direct purchase of 20 U.S.-built aircraft meant

that most of the parts for these aircraft would come from existing

McDonnell Douglas suppliers, not from new production facilities to be

built in China. According to a government official, one of the reasons for

the contract amendment was to speed up deliveries of aircraft to Chinese

airlines rather than wait until the Chinese Trunkliner factories were able

to produce complete aircraft. By August 1996, deliveries of the 20

U.S.-built aircraft had already begun under this amended contract even

though none of the exported machine tools were yet operational.

The report acknowledges that McDonnell Douglas noted in its export

applications that the machine tools would also be used by CATIC to perform

related offset work (i.e., production of parts for U.S.-built McDonnell

Douglas aircraft). However, during the licensing review process, neither

McDonnell Douglas nor the reviewing agencies took the position that

offset work was the major justification for approval of these export license

applications.

4. The observation that not all of the equipment was needed to support

Trunkliner aircraft production is supported by more than just the

observation that existing Trunkliner factories had stretch presses with

sufficient capacity to perform Trunkliner work. As noted in the report,

CATIC, McDonnell Douglas’ partner in producing Trunkliner aircraft in

Page 38 GAO/NSIAD-97-4 Export Controls
Appendix VI 

Comments From McDonnell Douglas

China, diverted not only the stretch press but also one five-axis machine

tool, three three-axis machine tools, and one coordinate measuring

machine to the Nanchang Aircraft Company—a factory not involved in

Trunkliner production. McDonnell Douglas then asked the Commerce

Department to allow these machine tools to remain at Nanchang for

production unrelated to the Trunkliner program. The diversion of the tools

to Nanchang and the submission of license amendments to permit the

tools to remain in a non-Trunkliner factory do not support the statement

that all of these tools were required for Trunkliner production as

McDonnell Douglas indicated during the export application process.

5. We agree that McDonnell Douglas was to vacate the Ohio plant in the

summer of 1994. However, as noted in the report, McDonnell Douglas told

the reviewing agencies that the Air Force, not McDonnell Douglas, was

requiring it to leave the plant in Ohio by July 5, 1994, and it would be

forced to pay high storage fees for the machine tools after that date.

Further, in August 1994, McDonnell Douglas told DOD that “storage is

running at $45,000 per month” and urged action on the licenses so that

“mounting storage costs can be curtailed.” As noted in the report and

acknowledged by McDonnell Douglas in its comments, McDonnell

Douglas, not the Air Force, set the dates it had to leave the plant in Ohio.

Further, as noted in our report, beginning in September 1994, the Air Force

actually charged the company about $7,500 per month for storage fees.

Page 39 GAO/NSIAD-97-4 Export Controls
Appendix VII 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Karen S. Zuckerstein

David C. Trimble

Anne-Marie Lasowski

John Neumann

(707165) Page 40 GAO/NSIAD-97-4 Export Controls
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