- The Washington Times - Thursday, March 9, 2006

Web exclusive: updated 4:04 p.m.

A Dubai-owned company today backed off its bid to operate terminals in U.S. ports, bowing to intense opposition from Capitol Hill lawmakers who had told President Bush both chambers were ready to kill the controversial deal.

H. Edward Bilkey, chief executive officer of DP World, said his state-owned company will transfer fully the U.S. port operations it is purchasing from a British company to a U.S. entity. He said it was being done to preserve the relationship between the U.S. and United Arab Emirates. Dubai is one of the country’s seven emirates.

“We look forward to working with the Department of Treasury to implement the decision,” Mr. Bilkey said. He did not reveal what the new deal will entail.

DP World’s purchase of terminal operations at six U.S. ports from Peninsular and Oriental Steam Navigation Co., a British company, had set off a firestorm of criticism from Capitol Hill lawmakers. Members of both parties said national security interests were not properly considered when the administration approved the sale of U.S. terminals to a country with recent ties to al Qaeda and Osama bin Laden.

The White House earlier today had signaled more willingness to negotiate with lawmakers over the deal after House and Senate Republican leaders told Mr. Bush both chambers were ready to block the controversial deal. Mr. Bush has said he would veto any effort to block it.

A key House committee moved to block the deal yesterday, with the House Republican leaders supporting that move.

In the Senate, Republican leaders had been urging a more wait-and-see approach, but Senate Democrats forced the matter to the floor today.

Sen. Charles E. Schumer, New York Democrat, tried to add an amendment to kill the deal to a lobbying reform bill the Senate was considering. It was not clear today whether Senate Republicans could block him from offering it.

Senate Republican Leader Bill Frist, Tennessee Republican, strongly criticized Mr. Schumer’s move.

“Things are moving along aggressively toward a resolution,” said Mr. Frist, who welcomed the DP World announcement.

Mr. Schumer called it “a promising development” but said “the devil is in the details.”

The port deal was first approved by an interagency panel, which included representatives of four Cabinet members. Neither the Cabinet members nor Mr. Bush knew of its approval until after it occurred. Outrage from Capitol Hill led to a second 45-day executive review, which was ongoing.

Mr. Bush, who would have had the final say, had vowed to veto any legislative effort to block it.

This story is based in part on wire service reports.

Related article:

House panel votes no on ports

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