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18 Jan 07. Blair faces new OECD pressure on halted BAE inquiry. Pressure on Tony Blair over his decision to shut down an investigation into BAE Systems will increase sharply today when a key international body announces that it is widening its inquiry into bribery and corruption, The Times has learnt. The inquiry by the Organisation for Economic Co-operation and Development into whether the Prime Minister’s decision broke Britain’s own laws, and its treaty obligations under the international Anti-Bribery Convention, is set to be expanded, sources indicated. Yesterday, in an attempt to diffuse the growing pressure around the BAE decision, Lord Goldsmith, the Attorney-General, said that BAE Systems was not “beyond the law”. In a letter to Sir Menzies Campbell, the leader of the Liberal Democrats, he said that he had told the Serious Fraud Office to pursue other investigations into BAE contracts “vigorously”. The Times understands that the OECD is set to announce that so-called examiners will be appointed by its 35 other member countries to examine whether the Government’s move breached the convention’s rules for enforcing laws against bribery and corruption. It also appeared likely that the blow to the Government from the expected OECD decision to step up its scrutiny of the affair will be compounded by a hard-hitting statement from the Paris-based institution criticising Britain, and emphasising the OECD’s determination to do everything possible to oppose corruption. This month Ángel Gurría, the Secretary-General of the OECD, delivered a speech calling for an anti-corruption “crusade” by member states. Both Mr Blair and Lord Goldsmith have justified the decision to end the Serious Fraud Office’s investigation of a £60m deal by BAE Systems on grounds of national security. But sources noted that there was no provision under the Anti-Bribery Convention, which the UK has signed, for such action. (Source: The Times)

13 Jan 07. Austria’s new defence minister Norbert Darabos, seen here at the Defense Ministry in Vienna, said he remained determined to drop a contract signed by the former government to purchase 18 Eurofighter jets. Austria’s new defence minister Norbert Darabos said he remained determined to drop a contract signed by the former government to purchase 18 Eurofighter jets. “The objective is still to pull out of the Eurofighter contract. The costs are simply too high,” the Social Democrat minister told the daily newspaper Oesterreich. But he added: “I cannot say yet whether a pull-out is financially feasible.” Chancellor Alfred Gusenbauer, also a Social Democrat, made a campaign pledge to scrap the Eurofighter contract, worth some €2.0bn ($2.58bn), before his election on October 1. But no such plan appears in the 177-page government contract agreed upon with the conservatives to form a new ruling coalition. The government of former conservative Chancellor Wolfgang Schuessel signed the deal in 2003. In two-month-long coalition talks, the Social Democrats and conservatives only agreed to emphasise the importance of Austria’s air defence and to find ways to guarantee it. A parliamentary commission, launched in late October by the Social Democrats, the environmental Green party and part of the far-right to examine the contract awarded European aerospace group EADS is expected to publish its conclusions in March. In early November, former Defence Minister Guenther Platter estimated that pulling out of the Eurofighter contract would cost Austria at least €1.2bn, based on a preliminary EADS figure. Austria’s outgoing government paid the first two installments, worth some €218m , for the Eurofighters this week, according to press reports, which the the finance ministry refused to confirm. The first four aircraft are being completed at EADS’s assembly line in Manching, Germany and their delivery is set for early 2007. Darabos said he planned to begin formal talks with the group soon. He added that there had been infor

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