Israeli firms still dealing with companies tied to Iran

The Los Angeles municipality is considering canceling a contract worth hundreds of millions of dollars with the German firm Siemens to improve the public transportation infrastructure in the city.

The reason is Siemens' widespread commercial ties with Iran's ruling regime. One deal in particular - Siemens joint venture with the Finnish telecommunications giant Nokia to sell sophisticated wiretapping equipment to the Iranian government - has sparked widespread anger.

The equipment is being used by that country's intelligence and security forces to locate and follow telephone calls made by opponents of the regime who are then arrested and subjected to prolonged interrogation and torture.

Richard Katz, a member of the Los Angeles Metropolitan Transportation Authority board, told the Washington Times that "at a time when the city and the board of supervisors are urging divestment from Iran, it would be hypocritical of our board to make a deal with Siemens or anyone else who is doing business in Iran."

Siemens is the biggest German exporter of equipment, know-how and services to Iran. The scope of its business there is close to 1 billion euros.

With hundreds of companies engaged in trade to the Iran, Germany is the Islamic regime's biggest business partner in the European Union selling goods worth some 4 billion euros per year to them.

And in the broader EU, thousands of industrial plants, banks and financial institutions from all over do very good business with Tehran. In this way the firms undermine the international effort to put economic pressure on that country to stop their nuclear program.

This two-faced policy is arousing anger in the United States where the law forbids commercial ties with Iran. The American administration, together with state governors and labor unions, are taking pains to get the EU, Japan and Australia signed on to the embargo. Washington is demanding that banks and financial institutions withhold credit from Iran and that industrial firms like Siemens not build infrastructure programs, especially those connected with the energy industry.

The most effective threat against those companies is that of a divestment campaign. Various bodies in the U.S. are threatening to stop investing their pension money and funds with anyone who does business with Tehran.

This pressure is bringing results. Banks in Switzerland such as UBS have pared down their ties with Iran. Other banks, such as the British house Lloyds, have been forced to pay fines of hundreds of millions of dollars.

Israel is not merely a bystander benefiting from this policy. It actually spearheaded it.

For many years, prime ministers, foreign ministers, heads of the Mossad and others have been lecturing the entire world and calling on everyone to work against Iran's nuclear program. They have advised nations to sever diplomatic relations, impose sanctions, impose an embargo on the export of oil, reduce commercial ties, impose a maritime blockade and, if all this does not help, launch a military attack.

Israeli diplomats have protested to the Swiss government over the signing of a giant natural gas deal with Iran, and the Israeli ambassador to Vienna, Dan Ashbel, has submitted a protest to the Austrian government about OMV, the government controlled Austrian concern which is aiming to develop a gas field in Iran.

No divestment at home

However while Israel makes plenty of demands of others, it turns out it does nothing itself. Companies that have close commercial ties with Iran enjoy large-scale exposure in the Israeli market.

An example is Siemens, which in the past sold gas turbines to the Israel Electric Corporation worth billions of shekels and recently won a tender put out by the Israel Airports Authority for a NIS 150 million deal to set up a facility for carrying out security checks and handling baggage.

The airports authority said in response that "four companies applied for the international tender for security examinations to baggage and two of them provided proposals. The Siemens company is the only one that met the complex technical requirements that were defined."

The Israeli branch of Siemens referred the newspaper to the standard international response of the company that states that its dealings with Iran are limited solely to the civilian sphere. International banks that have connections with Iran are also continuing to work with Israeli banks; Nokia sells telecommunications equipment in Israel worth hundreds of millions of shekels, including to state bodies.

Even under the repressive regime in Iran, the public there has demonstrated greater courage and responsibility than in Israel. There were reports last week that an unofficial consumer boycott has been imposed by Iranian citizens on Nokia and that the sale of portable telephones by that company has dropped by almost half.

The Iranian civil rights activist Shirin Ebadi, who won the Nobel Peace Prize in 2003, told the Washington Times last week that she was calling for a boycott of all the companies like Siemens and Nokia which have violated civil rights in Iran. "If such companies are faced with consequences that effect their 'bottom line' they will be less enticed to enter into business agreements with any government attempting to restrict the basic human rights of their people," she said.

Israel's hypocrisy is particularly jarring now in view of the declarations by Prime Minister Benjamin Netanyahu's government that a nuclear Iran is an existential threat to Israel and that it has to be stopped at all costs. Apparently that is on the condition that the costs are paid by others.

Moreover a law was passed in Israel in April 2008 forbidding investment in corporations that have commercial ties with Iran, but so far Israel has not taken a single step to apply the law. Only now, in the wake of a question from Haaretz to the prime minister's bureau, was an answer received stating, "We expect the corporations and companies to be familiar with the letter of the law and to observe it."

But this statement too does not have any kind of hint as to what the Prime Minister's Office plans to do to enforce the law, if anything, even though a source in the ministry promised that the National Security Council and the Money Laundering and Terror Financing Prohibition Authority would begin to deal with the matter.