Congress has been notified of the decision, and it will soon be published in the Federal Register, the official journal of US government activities, State Department spokesman Richard Boucher said.

"We will be imposing some penalties on Armenian, Chinese and Moldovan entities pursuant to the Iran nonproliferation act of 2000," Boucher said. He did not name the firms or describe the offending exports in more detail.

"The penalties are being imposed on entities for the transfer to Iran of equipment and technology listed on multilateral export control lists," he said.

"Penalties are specific to the named entities, and do not extend to the Armenian, Chinese or Moldovan governments," Boucher said, adding: "We appreciate the efforts that Moldova and Armenia have made in non proliferation."

Asked whether China had made similar anti-proliferation efforts, Boucher declined to answer directly, repeating that Moldova and Armenia had made good appreciated efforts to crack down on proliferation.

The spread of military equipment and technology, often involving missile components is one of the most sensitive issues in the US-China relationship.

In January the United States imposed sanctions on two Chinese firms and one individual agent it accused of supplying Iran with materials used in the manufacture of chemical and biological weapons.

The Iran Nonproliferation Act of 2000 prohibits the sale of chemical and biological weapons components and missiles and missile technology to Iran, and is designed to stop Tehran, branded part of the "axis of evil" by President George W. Bush, acquiring weapons of mass destruction.

The restrictions, which will be in effect for two years, prohibit any US government contracts with the entities and bar them from purchasing any defense items from the United States.

Last September 1, the United States imposed sanctions on a Chinese state-owned firm it accused of funneling missile technology to Pakistan, which is engaged in a nuclear arms race with its arch-rival India.

China says it has enacted a new system of export controls designed to prevent proliferation. Top US officials argue that the safeguards are still not sufficient.

All rights reserved. � 2002 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse.

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