On April 30, 2024, the Department of State proposed an amendment to the International Traffic in Arms Regulations (ITAR) intended to facilitate exports of defense articles, the performance of defense services, and brokering activities between or among authorized users in the United States, United Kingdom (UK) and Australia.
This announcement follows the release by the Bureau of Industry and Security (BIS) of an interim final rule on April 19, 2024, aimed at reducing export control restrictions for the same countries and further strengthening the AUKUS trilateral security partnership. We previously provided a summary of the BIS rule here.
Key Changes
The ITAR rule would enact three key changes to help facilitate the exchange of defense articles and services between the UK, Australia and the United States.
- First, it would create a broad exemption for exports and brokering of most defense articles from the U.S. to authorized end users in Australia and the UK.
- Second, ITAR § 126.18 would be expanded to authorize the retransfer of classified defense articles to citizens of Australia and the UK with security clearances even if they are dual nationals of a third country.
- Third, the rule would establish an expedited review timeline for license applications for the export of defense articles and defense services to Australia, the United Kingdom and Canada.
We discuss each of these developments in more detail below.
126.7 Exemption for defense trade and cooperation among Australia, the United Kingdom and the United States.
The new ITAR exemption in ITAR § 126.7 would authorize the export, reexport, retransfer or temporary import of defense articles, as well as the performance of defense services, or engagement in brokering activities, involving authorized end users in Australia and the UK. Authorized end users will include U.S. persons registered with DDTC and not debarred, as well as end users from the AUKUS countries identified on DDTC’s website. Australia and the United Kingdom’s members will undergo an authorized user enrollment process, in coordination with DDTC, and those members will be listed through the DDTC website. UK and Australia authorized users may request that DDTC provide confirmation of the status of U.S. authorized users. The transfer must be to the physical territory of Australia, the UK or the United States.
Certain defense articles identified in Supplement No. 2 to part 126 will be ineligible for transfer under this exemption. Examples of items on this list include: Missile Technology Control Regime (MTCR) articles under USML Cat. I-XV, and XX, readily identifiable anti-tamper articles, cluster munitions, F-22 aircraft and related specifically designed articles, and certain manufacturing know-how and source code.
126.18 Exemptions regarding intra-company, intra-organization, and intragovernmental transfers to employees who are dual nationals or third-country nationals.
The new exemption provisions under § 126.18 would allow certain dual nationals of Australia and the UK to receive classified defense articles without a separate license from DDTC. This is intended to facilitate the use of the § 126.7 exemption above, while allowing allow dual nationals of another country, and Australia or the UK, to handle classified defense articles.
Applicable dual nationals must:
- be authorized users of the exemption in § 126.7 or regular employees of such authorized users in § 126.7;
- hold a security clearance approved by Australia, the UK, or the United States that is equivalent to the classification level of SECRET or above in the United States; and
- be either (i) located within the physical territory of Australia, the UK or the United States or (ii) a member of the armed forces of Australia, the UK or the United States acting in their official capacity.
126.15 Expedited processing of license applications for the export of defense articles and defense services to Australia,…
This article was originally published by a www.jdsupra.com . Read the Original article here. .