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Massachusetts tries to revive Myanm

Subject: Massachusetts tries to revive Myanmar boycott

Massachusetts tries to revive Myanmar boycott
Withdrawal of pension funds sought

November 23, 1998

BOSTON -- A Massachusetts lawmaker said he may file new legislation to halt
public investment in companies doing business with Myanmar.

Rep. Byron Rushing, who authored the 1996 selective purchasing law set
aside by a federal judge, said activists are considering a measure
requiring commonwealth pension funds to pull their funds out of
corporations linked with military-ruled Myanmar.

The move would be a different tack for rights activists after U.S. District
Court Judge Joseph Tauro ordered an injunction Thursday against the law.

The judge halted enforcement of the curbs on state contracting with
companies that do business with Myanmar, after ruling on Nov. 4 that the
law is unconstitutional.

Massachusetts Assistant Attorney General Thomas Barnico said an appeal may
be filed as soon as today asking either Judge Tauro or the appeals court to
reinstate the law.

Frank Kittredge, president of the National Foreign Trade Council, which
brought the landmark suit against the "subfederal" sanction in April, said
the corporate lobbying group is likely to fight any motion to keep the law
in effect.

"I think we would prefer to have it unenforceable," Mr. Kittredge said.

The suit by the 580-member association was intended to set a precedent for
challenging dozens of subfederal measures against companies that trade with
countries ranging from Myanmar to Nigeria.

Judge Tauro ruled that the Massachusetts law infringes on the federal power
to regulate foreign affairs. The state argues that it is only exercising
its right to choose its own suppliers. Mr. Kittredge said it has not been
decided whether to proceed against selective purchasing statutes enacted by
other states, counties and municipalities before the Massachusetts appeal
runs its course.

The trade council is hoping for an expedited process, however. Mr. Barnico
estimated that the appeal could be decided in two months. Legal scholars
say the issue may eventually go to the Supreme Court. The full extent of
Judge Tauro's injunction remains unclear. Neither side knows, for example,
whether Massachusetts will be forced to shut down its Web site, where
companies doing business with Myanmar are identified.

Mr. Rushing, a Boston Democrat, said he believes the state still has the
right to ask companies whether they trade with Myanmar. The new divestment
legislation would allow the state to keep its list active, he said.

Massachusetts had both a selective purchasing law and a divestment measure
against South Africa in the 1980s. Both were effective on bringing pressure
on the apartheid government, Neither was challenged. So far, no other
states have a divestment law aimed at Myanmar. The injunction could lead to
suspension of a World Trade Organization complaint brought by the European
Union and Japan. The complaint, which is due to go before a dispute
resolution panel, alleges that the Massachusetts law violates a 1994
Government Procurement Agreement on open bidding.

Since Judge Tauro's ruling, U.S. officials have been trying to convince the
EU and Japan to withdraw their action because the Massachusetts law is
technically no longer in effect.

"I'm sure this will be reported to Brussels and that it will be looked at
very seriously," said an EU official in Washington, referring to the
injunction. The EU filed a friend-of-the-court brief supporting the trade
council's stand.