Senate Banking, Housing and Urban Affairs Chairman Richard Shelby (R-Ala.) is expected to move legislation later this year reforming the secretive governmental panel responsible for approving a controversial takeover of management operations at a host of U.S. ports by the Dubai Ports World corporation despite potential serious gaps in intelligence regarding the United Arab Emirates company, Senate aides said on Monday.
Meanwhile, Bush administration officials defended their decision to approve the deal during a sometimes heated Senate Homeland Security and Governmental Affairs Committee hearing on the Dubai deal Monday. House Republican leaders today will also discuss the issue in order to determine what the next steps for the chamber will be, a spokesman for Speaker Dennis Hastert (R-Ill.) said on Monday.
The Banking Committee, which will hold a hearing on Wednesday on the DPW deal, is one of at least three Senate Committees and one House panel already moving to investigate the deal. The Armed Services Committee will also hold a hearing on the approval of the deal involving the Committee on Foreign Investment in the United States this week.
Shelby, a longtime critic of the CFIUS, has not yet announced details of his legislative package. But a committee spokesman said the chairman would work with ranking member Paul Sarbanes (D-Md.) and committee members including Sens. Charles Schumer (D-N.Y.) and Bob Menendez (D-N.J.) on a bipartisan bill that would expand Congressional oversight of the committee and involvement in its decisions, as well as make the approval of foreign investment deals more transparent.
The CFIUS is made up of more than a dozen federal agencies and is chaired by the Department of Treasury’s assistant secretary for international affairs, Clay Lowery. Under current rules, the CFIUS is required to conduct a 45-day investigation of a potential deal if it could cause a national security threat. Currently, the president is required to notify Congress only if he decides to hold up a deal and not when investigations are launched.
In the DPW case, the Department of Homeland Security raised formal concerns, although DHS’ representative on the CFIUS Assistant Secretary for Policy, Planning and International Affairs Stewart Baker told the Homeland Security panel that the DHS did not seek a 45-day review.
Although Lowery insisted that the law had been followed, Chairwoman Susan Collins (R-Maine) questioned whether an adequate review was done, pointing to recently declassified portions of a Coast Guard report that highlighted “many intelligence gaps, concerning the potential for DPW or [its subsidiary] P&O assets to support terrorist operations.” According to the declassified portions of the report, those gaps precluded “an overall threat assessment of the potential DPW and P&O Ports merger.”
While Lowery insisted under questioning that all concerns had been resolved during the CFIUS’ 30-day review, a clearly agitated Collins questioned whether that was possible. “I don’t see how you were able to close those gaps so quickly,” Collins said, adding, “On the face of it ... that language is very troubling to me.”
Addressing intelligence shortfalls in the CFIUS reviews is not a new topic of concern. According to a September 2005 Government Accountability Office report on the CFIUS, Justice Department officials have also criticized the process and warned that 30 days was not an adequate time to resolve intelligence gaps.
Visitors get their first look at the American Veterans Disabled for Life Memorial, which opened to the public on Monday, Oct. 6, 2014. The new memorial is located off Independence Ave. SW between the Rayburn House Office Building and HHS. Buy photo here.