Defense Dept. won't segregate foreign staffers

WASHINGTON -- The Pentagon won't require badges and segregated areas for foreigners working on high-security contracts, citing opposition from US companies and universities.

``National security, as it relates to research and development, involves a balancing act," the Department of Defense said. ``The first proposed rule was overly prescriptive."

The Pentagon proposed the security restrictions in July 2005, after its inspector general warned that some contractors were giving foreigners unauthorized access to technologies that are unclassified yet would be subject to export restrictions if sent overseas.

Three months ago, the Commerce Department made a similar decision and instead agreed to form a commission to study the issue of foreigners working in US laboratories.

``Everyone's trying to get it right, and I think that's what this is all about," said George Scalise, president of the Semiconductor Industry Association.

A Bush administration study last year concluded that more than 90 countries were using corporate contacts, scientists, and foreign students to obtain sensitive US technology.

But university and business leaders argued that the restrictions would mean millions of dollars in losses from direct compliance costs and untold more from discouraging critically needed foreign scientific expertise.

The new proposed rule would make clear that contracts must comply with existing export rules, while eliminating suggested requirements in such areas as badges and segregated work areas. The Pentagon said it will take comments through Oct. 12.

The new proposal is an acceptable means of making contractors aware of their obligations, said Tobin Smith, senior federal relations officer at the Association of American Universities, whose members include Harvard and Yale.