Posted: Wed, Jan 1, 2003, 2:11 PM ET (1911 GMT)
The State Department has formally accused Boeing and Hughes of willfully transferring sensitive space technologies to China in the 1990s, the Washington Post reported Wednesday. The State Department filed a 32-page "charging letter" last week claiming that Hughes Space and Communications, a satellite manufacturer that is now owned by Boeing, allowed sensitive technologies to fall into Chinese hands during investigations of Chinese launch failures carrying Hughes satellites in the 1990s. If the charges are upheld by a federal administrative judge and top State Department officials, the companies could be fined up to $60 million and barred from selling "controlled technologies" to any foreign customer, a penalty that could seriously hurt Boeing's commercial satellite business. The two companies have fought the allegations for several years, claiming they did nothing wrong under the more relaxed regulations at the time. The technology transfer issue eventually led Congress to pass legislation that transferred satellite export licensing from the Commerce Department to the stricter State Department. That decision has made it essentially impossible for any commercial satellite made in the US or with American components to be exported to China for launch. Loral, another satellite manufacturer accused of technology transfer to China, settled its case with the State Department last year by paying a $14 million fine.

Related Links:

•  Washington Post article
•  New York Times article