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Governors threaten legal action to halt ports takeover by Arab company

[JURIST] New York Gov. George Pataki and Maryland Gov. Robert Ehrlich [official websites] have threatened to take legal steps to block an Arab company's takeover of operations in several major US ports. The governors cite security concerns associated with the acquisition that will leave Dubai Ports World [corporate website] in control of port operations in Baltimore, Miami, New Jersey, New Orleans, New York and Philadelphia, and say they may cancel lease arrangements with the company. Ehrlich said the states should have been notified by the Bush administration before it approved the deal. Democratic Sen. Robert Menendez said he would introduce legislation [news release] along with Sen. Hillary Clinton [official website] that would bar the sale of port operations to foreign governments.

Dubai Ports World, a state-owned business in the United Arab Emirates, gained control of US ports operations after a takeover of the British company Peninsular & Oriental Steam. The takeover was approved by the Bush administration after the company agreed to certain security precautions, according to Homeland Security Secretary Michael Chertoff [official profile]. Opponents have argued that the United Arab Emirates was used as a financial and operational base for the Sept. 11 terror attacks and for nuclear smuggling involving Iran, Pakistan, Libya and North Korea. In January, President Bush appointed a Dubai Ports World executive [DP World news release], Dave Sanborn, to serve as Maritime Administrator [official website]. AP has more.

3:34 PM ET - Senate Majority Leader Bill Frist (R-TN) [official website] said Tuesday that if the White House does not agree to delay the deal that would allow DP World to take over operation of the ports, he plans to introduce legislation [press release] that would "ensure that the deal is placed on hold until this decision gets a more thorough review." DP World is scheduled to take over operations on March 2. AP has more.

3:55 PM ET - President Bush told reporters Tuesday afternoon that he will veto any bill that would hold up the deal to allow DP World to take over operations of the six ports. AP has more.

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