February 22, 2006

Senate banking panel sets ports hearing

WASHINGTON (Reuters) - The Senate Banking Committee said on
Wednesday it will hold a hearing next week on a plan to hand
over operations at major U.S. ports to an Arab company, as it
continues probing the way such deals are handled by the U.S.

The panel's chairman, Republican Richard Shelby of Alabama,
had complained the government's review process was too murky
and might need legislative repair -- even before the recent
controversial decision to allow state-controlled Dubai Ports
World to manage six U.S. ports.

That decision by the Committee on Foreign Investments in
the United States (CFIUS), an inter-agency panel led by the
U.S. Treasury, has sparked outrage in both political parties on
Capitol Hill. It will be the focus of the March 2 hearing of
the banking committee, which has jurisdiction over CFIUS.

Witnesses will include representatives from the Treasury,
Homeland Security and Defense departments, as well as experts
on port security and U.S. relations with the United Arab
Emirates, a banking committee spokesman said.

Shelby and the banking panel's ranking Democrat, Maryland's
Paul Sarbanes, wrote to Treasury Secretary John Snow last week
requesting a review of the Dubai Ports World deal.

The lawmakers said they highlighted questions raised in two
hearings last year about the law that governs the review of
foreign investments.

In January, Shelby announced the banking committee might
produce legislation this year to improve transparency in the
CFIUS review process and ensure adequate consideration of
national security interests.

Last October, Deputy Treasury Secretary Robert Kimmitt told
the banking committee that more transparency in CFIUS
deliberations would be appropriate, but not a congressional
veto of decisions.

Other congressional committees are also weighing in. The
Senate Commerce Committee said it would hold a hearing March 2
to examine what the deal means for terminal operations at
ports. And the Senate Armed Services Committee is being briefed
on Thursday on national security implications.