Bonn, in Shift, Will Probe Firm Over Libya Plant

BONN —  The West German government sharply reversed itself Friday as officials announced that legal proceedings will be undertaken against a West German firm that the United States has accused of supplying critical help to a Libyan plant it contends was built to make chemical weapons.

The about-face is causing considerable embarrassment in government circles. Only last week the Finance Ministry had cleared the firm, Imhausen-Chemie, in southwestern Germany, of involvement. But Friday, Werner Botz, a spokesman for the regional state prosecutor’s office in Offenburg, announced that Imhausen-Chemie is under criminal investigation for possible violation of export controls dealing with materials that could have a military application.

Hans Frey, a spokesman for the federal prosecutor’s office in Karlsruhe, confirmed that the investigation is under way.

It has become clear that West German firms have been much more deeply involved with the Libyan plant than had been suspected, and Chancellor Helmut Kohl has been forced to change his public position.

Last week, Kohl angrily objected to U.S. leaks to the American news media accusing West German firms of helping the Libyans build the plant, which according to Libyan leader Moammar Kadafi is intended to produce pharmaceuticals. Other West German officials said their investigations had not turned up evidence of West German commercial involvement and complained that information provided by the United States had been inadequate.

On Thursday, Kohl said in televised remarks that his government now has documents indicating that West German firms were involved in the design and construction of the plant, which is situated at Rabta, about 40 miles southwest of Tripoli, the Libyan capital.

‘Serious Information’

And on Friday, Kohl’s personal spokesman, Friedhelm Ost, admitted that the government had received “serious information” about Imhausen-Chemie from the BND, the West German intelligence service, as far back as October.

In Washington, State Department spokesman Charles Redman said Friday that the United States had provided visiting West German officials with additional information on the nature of the Rabta plant and the involvement of West German firms in its construction.

“The discussions have been useful and productive,” Redman said. “We are trying to be responsible in providing as much information as is possible.”

The information was passed during a two-day meeting of American and West German technical experts that ended Friday. Redman said that details of the talks were kept secret because most of the information involved classified intelligence. He refused even to divulge the specific location of the talks, which were arranged earlier this week when Secretary of State George P. Shultz met with West German Foreign Minister Hans-Dietrich Genscher in Paris, where both were attending a 149-nation conference on chemical warfare.

In addition, Redman said that Bonn’s finance minister, Gerhard Stoltenberg, met Friday with Deputy Secretary of State John C. Whitehead “to continue our high-level dialogue on the Libyan chemical weapons program.” Stoltenberg was in Washington for talks on economic and financial issues.

Stoltenberg, in a curbside news conference outside the State Department, said of Friday’s news about the action against Imhausen-Chemie: “There was no proof a week ago . . . and now there is some new information in the last days . . . which could lead to criminal prosecution.”

But he said “it’s not a final decision. . . . We must have complete evidence (to prosecute).”

State Department officials welcomed Bonn’s decision to begin legal proceedings against the firm.

Chancellor Kohl himself apparently had no knowledge of the BND reports from its agents in the Middle East when he was in Washington in November and met with Shultz, who told him what U.S. officials knew about the involvement of West German firms in Libya.

Then and later, Kohl dismissed, apparently as inadequate, the American evidence of West German involvement. Several West German officials said they were surprised that Kohl took such a strong position on the U.S. charges even though it was clear that the CIA had some kind of proof.

“If you noticed,” a senior West German official said, “Genscher played it very cool and cautious. He did not deny the American evidence and called for stronger export controls immediately. Kohl, on the other hand, was very rash, very strong with his statements. And now he looks pretty silly.”

The United States, according to sources here, not only had intelligence from workers at the plant and satellite photos that established the plant’s character; it had monitored communications between Libya and the German companies.

“Some of this evidence was in the form of communication intercepts,” one source said, “and thus was very sensitive. To make it public would show that the United States could intercept and record telephone conversations between West Germany and Libya, and presumably elsewhere.”

Why the tardy reaction to the American evidence?

According to sources here, in order for West German officials to accept the American evidence it had to be able to stand up in court, not just provide the basis for Bonn to undertake an investigation of its own.

The West German magazine Bunte suggested that secret intelligence service reports were “misplaced” and that Kohl never saw the West German evidence in the matter.

Other sources suggested that West Germany’s tradition of firmly supporting its companies’ exports, no matter what the circumstances, has led to a head-in-the-sand posture when charges of illegalities are made.

West Germany’s various federal and state agencies apparently took their unaggressive lead from Kohl, who had publicly dismissed the U.S. evidence and charges.

The head of Imhausen-Chemie, Juergen Hippenstiel-Imhausen, heatedly denied last week that his firm was in any way connected with projects in Libya. And after an investigation that lasted just three days, Finance Ministry officials absolved the company of any illegal activity.

A woman who answered the telephone at Imhausen-Chemie on Friday said the firm would have no comment on the latest developments.

A breakthrough in the case came with the report in the national magazine Stern that IBI Engineering, a company with a Frankfurt office and run by a London-based Iraqi national named Ihsan Barbouti, had served as a conduit for personnel, plans and supplies for the Libyan plant. IBI was reported to have coordinated, through Imhausen-Chemie, the construction of the Rabta plant.

Admits Libya Connection

In a letter to the Times of London on Thursday, Barbouti admitted through his lawyers that he was a consulting engineer in Libya in 1985, and had been the contractor on many factories on the same site as the Rabta complex. He maintained that the controversial Rabta installation is a pharmaceutical plant.

Stern said that Barbouti organized the movement of supplies to Libya through the Frankfurt office and that the operation involved about 30 West German companies, several Austrian engineers and Swiss banks.

The magazine said that equipment from many of these companies ended up in Libya after passing through middlemen. Stern said that chemical equipment was shipped under the supervision of the Hamburg office of a firm called Pen-Tsao-Materia-Medica, consigned that firm’s subsidiary in Hong Kong, which represents Imhausen. The equipment ended up in Libya, Stern said.

Although IBI Frankfurt is now defunct, West German investigators have managed with Stern’s help to obtain 12 cases of records from the company’s former lawyer.

The existence of the records led Kohl to remark Thursday that “certain documents have been seized in the past few days from which some possible new--something I don’t know yet--conclusive material could be borne out, and not just suppositions.”

Late Thursday, Belgian newspapers disclosed that an Antwerp shipping agent named Jozef Gedopt confessed to falsifying freight documents for shipments of chemicals to Libya.

An Antwerp magistrate, Walter Desmedt, confirmed that Gedopt had been arrested on export violation charges. Desmedt described the shipments as “everything to build a factory and chemical products used in the working of it.”

Gedopt reportedly forged documents to obtain export licenses on behalf of Imhausen-Chemie and other German companies.

Sensitive chemical plant materials were reportedly loaded in Hamburg and Antwerp and ostensibly bound for Hong Kong, but were off-loaded in Libya.

Kohl and his Cabinet, after staving off American warnings, are now urging that West German export controls be tightened on sensitive materials such as those that could be used in chemical warfare. But many American and West German observers believe that this reaction is somewhat belated.

The conservative national daily Frankfurter Allgemeine observed Friday in a front-page commentary: “The Cabinet’s decision to tighten export controls comes as a surprise, considering the politicians’ statements of the past few days regarding the U.S. allegations. The German response that ‘no evidence could be found of legal violations’ did not really address the American accusations. If it is indeed true that no such violations occurred, why did Bonn suddenly decide to tighten export controls?

“The logical conclusion can only be that German export practices and legislation provide grounds for complaints. Considering it took Bonn six months to proceed with investigations against the Imhausen firm, the sometimes-harsh U.S. campaign just may have been the last straw to spur the authorities into taking action.”

Ulrich Kienzle, a commentator for West German state television, said: “To put it harshly, the situation was akin to a free market in the means of mass destruction. No wonder the Americans have presented us with a long list of our sins.”

President-elect Bush, traveling Friday from Washington to Islamorada, Fla., where he is spending the pre-inaugural weekend fishing, appeared to be trying to smooth over any U.S.-German ill feelings from the affair when he said:

“The Germans have had a chance to analyze this evidence, but I have never doubted Chancellor Kohl’s commitment to the control and elimination of chemical weapons. . . . The more we can come together on this information, and what it means, the better it is.”

Bush called for more intelligence-sharing efforts between nations to root out suspected chemical weapons plants.

Later, after arriving at the Marathon, Fla., airport, Bush told reporters that he would strive to keep pressure on the world community to take action against countries producing chemical weapons. He characterized the Paris conference as a first step in world understanding of the inherent dangers.

“I think there is . . . much more understanding now about that Rabta plant, and I think that’s a good thing. But I think the way to approach it now is to build on what happened there (in Paris) in terms of worldwide understanding, to start with a determination to stop proliferation and then proceed as best we can to the process of elimination of both chemical and biological” weapons.

Times staff writers Norman Kempster, in Washington, and Cathleen Decker, in Islamorada, Fla., contributed to this story.