Rakon's exports lawful, says Goff

Trade Minister Minister Phil Goff says that Auckland-based technology company Rakon has not been involved in unlawful exports.

Mr Goff asked for an inquiry after a Weekend Herald investigation and internal company documents showed that Rakon had played a crucial role in supplying crystal oscillators for United States military smart bombs.

Products specially designed for use in military equipment require clearance from the Government under the Customs and Excise Act 1996.

According to Mr Goff, the components for such products would also need to have unique properties distinguishing them for a predetermined military use in order to warrant being part of the strategic export system that requires special clearance.

Mr Goff told the defence and foreign affairs select committee yesterday that after discussions with Rakon, and on the basis of information supplied by the company, his officials were satisfied that the company's crystal oscillators did not require an export permit because they were "unlikely" to have been designed specially for military use.

He said radiation hardened products - also sometimes called nuclear hardened - were used in a wide range of applications including satellite communications and the aerospace industry.

"They are unlikely to be specially designed for military use," he said.

Furthermore, Rakon had informed the ministry that it had not manufactured or supplied any "radiation hardened" crystal oscillators.

Rakon had also told the ministry it had developed a "G-hardened" crystal oscillator but was not supplying it to any company for military use.

G-shock hardened products, often called "G-hardened," also had a range of uses including in surveying, marine, aviation and guided munitions applications.

"They have many applications and are unlikely to be specially designed for military use," Mr Goff said.

He said the ministry had received technical advice from the Defence Technology Agency, part of the development branch of the Defence Force.

Rakon, which publicly listed last month, made an announcement to the Stock Exchange yesterday welcoming the finding and saying it would "continue to work closely with [the Ministry of Foreign Affairs and Trade] on future product developments to ensure all export requirements continue to be complied with".

Green MP Keith Locke said the issue should not be about whether the two types of oscillators were specifically designed for military use.

"To me the real issue ... is whether Rakon is developing to a performance standard for a military purpose that is above the normal civilian purpose."