by Michael Connor

In response to the threat of a public campaign by a U.S.-based lobbying group, Ingersoll-Rand PLC joined a group of publicly-held companies that have agreed to halt sales of products to customers in Iran even though the sales are apparently legal and in compliance with U.S. laws that severely restrict exports to Iran.

Caterpillar Inc., General Electric Co. and Huntsman Corp. have recently made similar announcements.  Siemans AG has said it will not “accept new business with Iran” starting in mid-2010.

Iran Map_000006380393XSmallIngersoll-Rand President and CEO Michael Lamach, in a letter (PDF) to  the group United Against Nuclear Iran (UANI),  noted that “in light of very real and escalating concerns about the intentions of the current regime in Iran, many leading global companies around the world have opted to refrain from doing business with Iran.”

He said “Ingersoll-Rand now joins with those companies, and effective immediately will have its foreign subsidiaries stop accepting orders for all products, components and parts where the subsidiary knows such products, components or parts would be destined for Iran.”

However, Lamach’s letter was highly critical of UANI’s tactics, asserting: “Although you have raised a legitimate issue for discussion, we are deeply disappointed in some of your organization’s tactics, which strike us as fundamentally unfair and calculated solely to pressure Ingersoll-Rand in the public spotlight without regard to factual accuracy or even our input.”

Lamach told UANI that “total revenues derived from the company’s foreign subsidiaries have been immaterial in the context of the company’s total world-wide revenues. Ingersoll Rand has no employees, operations, or assets in Iran.”

UANI is a U.S.-based non-profit that describes itself as “a non-partisan, broad-based coalition that is united in a commitment to prevent Iran from fulfilling its ambition to become a regional super-power possessing nuclear weapons.”  The organization’s board of advisors includes former U.S. Ambassadors Richard Holbrooke and Dennis Ross.  UANI’s President is Mark D. Wallace, a former Ambassador to the United Nations under President George W. Bush.

In September 2009, General Electric Senior Vice President and General Brackett B. Denniston III signed a formal affidavit with UANI – “United Against Nuclear — Iran Business Declaration” (PDF) – in which the company certified that neither the company nor any of its subsidiaries is “engaged in any business or providing any goods or services in Iran, except authorized humanitarian goods and services (including activities related to informational materials and media content).”

In the affidavit, GE’s Denniston “certifies that any and all profits made by the Company from authorized humanitarian activities (which in the case of the Company are solely and exclusively made through HeaIthcare sales) in Iran will be donated to reputable charity organizations so long as Iran remains designated as a State Sponsor of Terrorism by the US government.”

Caterpillar told UANI that that the organization had “jumped to conclusions” about the company’s businesss in Iran.   In a March 25 letter (PDF), Caterpillar Chairman and CEO James Owens said “indirect sales through dealers and distributors of Caterpillar branded products in Iran amount to less than two tenths of one percent of Caterpillar’s 2009 worldwide sales and revenues. In no way are these sales material in a quantitative or qualitative sense.”   Even those sales “comply with applicable U.S. export control and economic sanctions laws and regulations,” Owens wrote.

However, Caterpillar agreed that it would prohibit its non-U.S. subsidiaries from “accepting any orders for Caterpillar machines, engines and new parts where the subsidiary knows that the product would be shipped to Iran.”

UANI’s web site features the Iranian Business Registry, a database of media and academic reports about companies doing business in Iran.  UANI says the registry “can be used for a number of ways for peaceful activism,” including shareholder divestment of companies continuing to do business in Iran.

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