HP Says It Will Stop Distributor's Sales in Iran

By Jordan Robertson

SAN FRANCISCO -- HP (HPQ Quote) said late Thursday that it would stop a distributor from selling its products in Iran. The computer and printer maker acknowledged that it knew the sales were occurring despite trade sanctions on Iran, but maintained it did nothing illegal and was halting the practice "to go beyond the letter of the law."

The Boston Globe reported last week that HP could be in violation of U.S. export laws because of an arrangement it had with Redington Gulf, a technology distributor in the Middle East, to sell HP printers in Iran.

HP said at the time and reiterated Thursday that it complies will all export laws. But in a short statement provided to The Associated Press, HP said it would clarify contracts with its distributors "to explicitly prohibit the sale of HP products in Iran." HP said it would more closely monitor its distributors.

"Having recently examined the situation, we believe it's important to go beyond the letter of the law," HP's statement said.

The company emphasized that it never shipped directly to Iran and doesn't have any employees there.

Even so, the Globe story noted that an HP manager had been quoted as calling Iran an important market. In 1999, HP's Middle East manager at the time estimated that sales in Iran would grow 50% a year, the Globe reported. The paper also cited a 2007 poll conducted by a local news organization that estimated HP printers owned 41% of the market in Iran.