"This is not about exports of missiles but rather illegal sales which are being investigated by the SBU (security service) which has opened a criminal investigation of the director of the company Ukraviazakas," the office said in a statement confirming a report by the London-based Financial Times's Friday edition.

The investigation was welcomed late last Friday by the United States, which along with Japan is reportedly worried about what appears to be a significant leak of military technology.

"I think it's fair to say that both the United States government and the Ukrainian government share a common concern and a dedication to acting to find out and prevent cases of proliferation," deputy US State Department spokesman Adam Ereli said.

"We've been working with the Ukrainian government to clamp down on proliferation. And the Ukrainian government, since these reports have come out, has said it's launching an internal investigation," he said.

"We certainly look forward to the results of that investigation," Ereli said. "And we'll work with them on steps and measures and joint actions we can take to prevent this kind of proliferation in the future."

Svyatoslav Piskun, Ukraine's prosecutor general, told the Financial Times that 18 Soviet-era KH-55 cruise missiles were exported in 2001 - 12 to Iran and six to China.

Piskun was also quoted as saying that the missiles were not exported with the nuclear warheads that they were designed to carry.

His office said a suspect in the case was currently standing a closed-door trial in Kiev.

Ukraine Foreign Minister Boris Tarasyuk said that the country's new leadership, which assumed power during late last year, was not responsible for the sales.

"We can only condemn the non-democratic actions that were carried out by the previous authorities," he said while on a visit to neighboring Belarus.

"The results of (our) investigation point to a criminal group that was involved in unlawful sales of arms," he said. Tarasyuk said the group included citizens of several countries.

The X-55, an air-launched missile also known as the Kh-55 and AS-15 and first introduced in 1976, has a range of 3,500 kilometers (2,175 miles), which would give China - or North Korea, if it obtained the missile - easy access to Japan, while Iran could hit its main regional foe, Israel.

Last month the Ukrainian government opened a criminal inquiry, at the request of Japan, into the illegal sale of 18 missiles by the Ukrspetsexport arms group to unspecified states via Russia.

The Ukrainian confirmation of missiles sales to Iran comes amid a tense diplomatic debate over Tehran's alleged quest for nuclear weaponry.

Reports about the missile sales going to Iran emerged earlier this month.

However Friday's statement was the first acknowledgement from the Kiev government, and is likely to heighten suspicions about Tehran's nuclear program.

The Islamic republic insists its nuclear program is aimed at peaceful civilian use but Washington claims it is designed to produce nuclear arms.

Ukraine had a massive weapons arsenal after the fall of the Soviet Union, but it returned its nuclear warheads to Russia or destroyed them under a US-funded disarmament program.

Its remaining weaponry is, however, a source of major concern in the West, fueled by several high-profile cases of arms trafficking including radar technology to Saddam Hussein's now ousted regime in Iraq.

Two anti-aircraft missiles and a launch system were reported stolen last month from a Ukrainian naval base in the Crimean peninsula, while Turkey reported seizing a Ukrainian radio-controlled missile and missile heads en route to Egypt last June.

All rights reserved. � 2004 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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