Archive for the ‘DDTC’ Category


Aug

3

Padilla Disses DDTC During House Subcommittee Hearing


Posted by at 3:44 pm on August 3, 2007
Category: BISDDTC

Christopher PadillaAn article (subscription only) in today’s edition of Inside U.S. Trade reports on the hearing held last Friday by the House Foreign Affairs Subcommittee on export controls. We have previously described the prepared testimony of Christopher Padilla, who heads Export Administration at the Bureau of Industry and Security (“BIS”), which he gave during that hearing. During the Subcommittee’s questioning of Padilla, the subject of processing times for license applications at the Department of State’s Directorate of Defense Trade Controls (“DDTC”) came up:

Padilla also criticized the staffing level of DDTC, which processes several times the licenses processed by … [BIS] with roughly half the staff. “In my personal opinion, I don’t think the State Department has sufficient resources to do the job,” Padilla said at the hearing.

Foreign Affairs Subcommittee Chairman Brad Sherman has been considering a user fee for export license applications processed by DDTC in order to try to speed up processing times. According to the Inside U.S. Trade linked above, aides to Sherman are circulating a draft of the proposal and are trying to keep the fees low enough to attract sufficient support and yet still be sufficient to ameliorate the processing delays.

Not everyone, however, is happy with the user fee proposal. The Vice-Chairman of the Subcommittee David Scott, who represents Marietta, Georgia, where Lockheed has operations, had this to say:

Any move toward a user fee to process a license could severely restrict the ability of industries to do business in a free market way

That’s what they might call hogwash in Georgia since the requirement to get an export license has pretty much tossed the ability “to do business in a free market way” out the window. Obviously, Scott just wants the taxpayer to bear the costs of processing the licenses and not the companies benefiting from them.

However, there is a compromise position that might have a better chance of acceptance by everyone involved. DDTC could impose, in the same way that the Citizenship and Immigration Services does, a premium processing fee, so that companies that need export licenses on a faster track would have that option but would have to pay for the privilege.

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Copyright © 2007 Clif Burns. All Rights Reserved.
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Jul

17

Rood Remarks on US-UK Export Treaty


Posted by at 11:57 am on July 17, 2007
Category: Arms ExportDDTC

FlagsAn article in today’s edition of the Financial Times reports on a press conference given yesterday by John Rood, Assistant Secretary of the State Department’s Bureau of International Security and Nonproliferation, where Rood discussed the recently signed Defense Trade Cooperation Treaty between the U.S. and the U.K. (Don’t go looking for a transcript at the State Department’s website; usually only Sean McCormack’s daily press briefing is posted and other special press briefings, such as Rood’s on the treaty, are not.)

Rood had a few interesting things to say. First, he said that the administration hopes to get the treaty through the Senate before the end of this year. This seems optimistic at this point with the August recess nearly upon us. Additionally, it is unclear how functional the Senate will be after the slumber party planned for the next few nights.

Second, Rood said that the State Department and the Department of Defense hoped to have “implementation procedures” in place “within six months” to determine what companies and individuals would be part of the “approved community” that could receive and disclose ITAR-controlled technical data without formal approval by the Directorate of Defense Trade Controls (DDTC).

Finally, Rood more or less dashed the hopes of other countries — such as Canada and Australia — that might arguably wish to have similar treatment as the U.K. Rood said the treaty was entered into because of the “close relationship” between the U.S. and U.K. Then he said:

If other countries approach us we’d have to ask ‘Do they have the same close relationship?’ I don’t know if we’ll do anything like that or not.

I’m sure that remark was well received in Ottawa and Canberra.

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Copyright © 2007 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)

Jun

27

New ITAR Firearms Export Exemption in the Works


Posted by at 6:08 pm on June 27, 2007
Category: Arms ExportDDTC

Air Marshal PracticeOfficer Ozzie Ossifer is patrolling in Vermont near the Canadian border when he witnesses a juvenile engage in an act of malicious criminal cow-tipping. He takes off after the delinquent who crosses the Canadian border. He follows the youth into Canada, his service revolver still firmly stored in his holster. Donuts and desk work have taken their toll on Officer Ossifer and the youth eludes him.

A bad day for the faithful law enforcement official becomes worse when he’s stopped by ICE as he attempts to cross back into the United States. He’s cuffed and taken away for having violated the Arms Export Control Act when he carried his service revolver into Canada without a license from the Directorate of Defense Trade Controls. The cow-tipper having escaped scot-free returns night after night to Vermont to terrorize the local bovine population while Officer Ossifer is on forced administrative leave.

“Nonsense,” you say. Surely the ITAR must have an exemption for this. Well, the ITAR does have an exemption for temporary exports of firearms in section 123.17, but that exemption would be of no avail to the officer in this case. Officer Ossifer made no declaration of the weapon and there was no customs inspection. Things look grim for our fictional Officer Ossifer.

However, the U.S. and Canada are working on an agreement that may protect future (and real) law enforcement officers that cross the Canadian border with their weapons. An article on the CTV website today revealed that Canada is considering a change in its Export and Import Permits Act to permit exempt imports and exports by law enforcement officers when they cross the U.S.-Canada border in the course of their official duties. Significantly this is said to be part of a reciprocal arrangement with the United States, although the United States has yet to announce that it is considering such a reciprocal arrangement.

The chief motivation appears not to be hot pursuit cases such as the one described above, but the U.S. Air Marshall program and its Canadian equivalent, the Canadian Air Carrier Protective Program. Section 123.17 of the ITAR doesn’t apply to U.S. air marshals, who instead can only export firearms without a license under section 123.18 and then only “if they are assigned abroad for extended duty.” It is, of course, safe to assume that the TSA and its air marshals have simply been ignoring the ITAR. If the CTV report is right, we can expect to see soon a revision of the ITAR to cover temporary exports of service weapons by law enforcement officers in the course of their official duties.

The Canadian Gazette notice of the proposed change in Canadian law can be found here.

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Copyright © 2007 Clif Burns. All Rights Reserved.
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Jun

26

US-UK Treaty Details Begin to Leak Out


Posted by at 5:10 pm on June 26, 2007
Category: Arms ExportDDTC

FlagsAlthough the text of the Defense Trade Cooperation Treaty signed last week by Bush and Blair has not yet been released to the public, the Society of British Aerospace Companies has published a summary of key points of the treaty. The summary answers some of the preliminary questions that were raised by conflicting press accounts of the treaty that we previously reported here.

Of key interest are what items will be subject to the treaty. Apparently the answer to that is almost everything on the USML. According to the SABC summary:

All USML items, with a small number of exceptions for highly-sensitive technologies that will be agreed between the UK and US, will be included in the coverage of the treaty. Subject to final agreement, the exceptions are likely to relate to low-observable technology and countermeasures, “anti-tamper” technology and communication security technology.

Additionally, dual-use items on the U.S. Commerce Control List will not be subject to the treaty, whereas “dual use” items on the U.K. Strategic Export Control List would be subject to the treaty. The reason for the different treatment of U.S. and U.K. dual use items is not clear and is not explained in the summary.

The SBAC summary also provides some interesting details on the export of technical data. The treatment of technical data in the treaty will be the subject of a separate post.

Credit is due to Jim Bartlett at Northrop Grumman for finding the SBAC summary. When a text of the treaty is made available, we will post it here.

UPDATE:
SBAC removed the key points summary of the treaty from its website. We have fixed the link above to point to our archive of the key points document. You can also see that document by clicking here.

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Jun

19

Left Behind


Posted by at 5:32 pm on June 19, 2007
Category: DDTC

OMV logoFor those of you who didn’t get to go to the Paris Air Show at Le Bourget and have been left behind, like me, to swelter in the heat and humidity of late June in the District of Columbia (or elsewhere), ExportLawBlog brings you the next best thing — a blog post on Le Bourget! (Well, maybe not the next best thing.)

It seems that John Douglass, president of the Aerospace Industries Association, did get to go to Le Bourget where he got to wash down a few amuse-gueules with a few coupes de champagne and to complain about U.S. export controls. Now that’s the life!

As reported in today’s EE Times:

John Douglass . . said that while export controls are necessary to protect national security, both sides agreed that more liberal export policies could help spur effective aerospace trade and technology cooperation among allies. . . . Global civil aviation sales are particularly strong, and Douglass said “We could even do better if we had a better rule set” for exports, said Douglass.

So far, so good.

The current U.S. export control is “based on two systems,” said the AIA president. One is for military exports that are tightly controlled by State Department, which “essentially says ‘no’ to exports,” Douglass argued.

That’s either the champagne talking or the reporter misunderstood Douglass. For as much as we criticize DDTC here at ExportLawBlog, we have never accused them of just saying “no” to exports.

Douglass then suggested, somewhat more sensibly, that international technology cooperation programs should be licensed based on the countries involved:

If you are a NATO country, you will be given ‘level- one’ cooperation, for example. But if you are a level-two nation, more controls are imposed.

It might make sense to codify a tiered approach, but it is quite clear that such an approach does currently inform licensing decisions at DDTC. It’s easier to get a TAA with a company based in a NATO country, for example, then it is to get one with a company in the UAE.

But the most interesting thing Douglass had to say he saved for last:

AIA hopes to ensure that the current U.S. export control system can be made more efficient and transparent. “But the best time to get this done is when the administration changes after the election next year,” said Douglass.

Notice how Douglass just slipped that in. The best time is after “the administration changes.” This is a tacit admission that the export reform proposals that the AIA made to President Bush through an industry group, and that we previously reported here, aren’t going anywhere.

Anyway, that’s the end of our trip to Le Bourget which, like all trips to France, are always too brief. Alors, très chers lecteurs de mon blog, à la prochaine!

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Copyright © 2007 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)