DDTC Posts New Dual and Third Country National Guidance
08/15/11 01:27 PM
The
U.S. Department of State’s Directorate of Defense
Trade Controls (DDTC) posted updated
Guidelines for Implementing New
Dual National/Third-Country National Policy for
Agreements. On its
website, DDTC states:
The following guidance relates to the August 15, 2011 implementation of the new §126.18 rule on dual and third country nationals. The first document relates to the changes to agreements and will be incorporated into the new Guidelines as well. D-TCN AG Guidance Final.
The following notional implementation plan is a suggested approach, but is by no means the only way of complying with the rule and its core principle of preventing diversion of defense articles to unauthorized end-users and end-uses. Consistent with local national laws and programs for the control/protection of defense articles/technologies and consistent with the need for private entities to protect proprietary data, technology security plans should be designed with a comprehensive and individualized approach to securing sensitive data of all kinds with appropriate measures for physical security and personnel clearances. D-TCN Policy Implementation Final.
Additional guidance and clarification is provided in the attached Frequently Asked Questions relating to both of the above documents. D-TCN FAQs Final.
The following guidance relates to the August 15, 2011 implementation of the new §126.18 rule on dual and third country nationals. The first document relates to the changes to agreements and will be incorporated into the new Guidelines as well. D-TCN AG Guidance Final.
The following notional implementation plan is a suggested approach, but is by no means the only way of complying with the rule and its core principle of preventing diversion of defense articles to unauthorized end-users and end-uses. Consistent with local national laws and programs for the control/protection of defense articles/technologies and consistent with the need for private entities to protect proprietary data, technology security plans should be designed with a comprehensive and individualized approach to securing sensitive data of all kinds with appropriate measures for physical security and personnel clearances. D-TCN Policy Implementation Final.
Additional guidance and clarification is provided in the attached Frequently Asked Questions relating to both of the above documents. D-TCN FAQs Final.
DDTC Now Posting the Status of Commodity Jurisdiction Cases
07/15/11 12:54 PM
The
U.S. Department of State’s Directorate of Defense
Trade Controls (DDTC) is now weekly posting the
processing status of commodity jurisdiction (CJ)
requests. Users can look up the status of their
case by the commodity jurisdiction case number via
the CJ Status
Spreadsheet.
DDTC Seeks Comments on Export/Import Licenses, Agreements, Reports, and Record Maintenance Requirements
06/30/11 09:20 PM
On
June 30, 2011, the Department of State posted
a notice in the Federal
Register seeking Office of Management and Budget
(OMB) approval for the information collection
requirements for the following:
Comments are due to the Department of State within 60 days from June 30, 2011 or by August 29, 2011.
- DSP-5:
Application/License for Permanent Export of
Unclassified Defense Articles and Related
Unclassified Technical Data;
• DSP-61: Application/License for Temporary Import of Unclassified Defense Articles;
• DSP-73: Application/License for Temporary Export of Unclassified Defense Articles;
• DSP-83: Non-Transfer and Use Certificate
• DSP-85: Application/License for Permanent/Temporary Export or Temporary Import of Classified Defense Articles and Classified Technical Data;
• DSP-94: Authority to Export Defense Articles and Services Sold under the Foreign Military Sales (FMS) Program;
• DSP-6, DSP-62, DSP-74, DSP-84, DSP-119: Application for Amendment to License for Export or Import of Classified or Unclassified Defense Articles and Related Technical Data;
• Request for Approval of Manufacturing License Agreements, Technical Assistance Agreements, and Other Agreements;
• Statement of Political Contributions, Fees, or Commissions in Connection with the Sale of Defense Articles or Services; and
• Maintenance of Records by Registrant.
Comments are due to the Department of State within 60 days from June 30, 2011 or by August 29, 2011.
DDTC Posts a New Commodity Jurisdiction Request Form
06/03/11 09:15 PM
The
U.S. Department of State Directorate of Defense
Trade Controls (DDTC) announced that effective June
3, 2011, applicants must download and use
the updated DS-4074 Version
1.1. All prior
versions of the form will be rejected.
DDTC No Longer Accepts DSP-85 License Application in Paper Form
05/13/11 03:23 PM
Effective May 13,
2011, Department of State Directorate of Defense
Trade Controls (DDTC) Licensing no longer accepts
the multi-page DSP-85 license application in paper
form. All submissions must now be made using the
DSP-85 downloadable and fillable
form, and mailed or
delivered to DDTC. The DSP-85 form may be found
under the Licensing tab under “Forms”. The
content of the form has not been changed.
DDTC Posts Testimony of Under Secretary Ellen Tauscher on Export Controls Reform
05/12/11 04:33 PM
On May
12, 2011, Department of State posted testimony of
Under Secretary for Arms Control and
International Security Ellen Tauscher on export
controls reform before the House Foreign Affairs
Committee.
The Under Secretary testified that the task force created to develop the new export controls regime is currently implementing Phase II. This includes working to revise the U.S. Munitions List (USML) and the Commerce Control List (CCL) so that they use common technologies and structures.
The Under Secretary said that, “State, Commerce, and Treasury are also in the process of adopting the Department of Defense’s export licensing computer system, which will be part of a unified, cross-government computer system for export control purposes. As part of this effort, exporters eventually will use a single form for applications to State, Commerce and Treasury. Exporters also will be able to submit those applications through a single electronic portal. This isn’t rocket science; we are simply adopting modern business practices.”
To address commodity jurisdiction determination issues, the State Department is working with the Departments of Defense and Commerce to create a “bright line” between munitions and dual-use items, which will finally provide clear guidance to exporters on commodity jurisdiction issues. Ellen Tauscher stated that, “this is necessary to update our system that is still designed with the assumption that technologies are developed for the military and only later find their way into the commercial sector, whereas, today, that is often the exception rather than the rule.”
As part of the USML review, agencies are developing a process for transferring items from the USML to the CCL which includes deciding on the appropriate licensing requirements on items that are moved to the CCL.
The Under Secretary also noted the Obama Administration also wants to improve the process for notifying Congress about arms sales and the transfer of items from the United USML as over the years the “process has become lengthy and unpredictable.”
The Under Secretary concluded that Phase III will complete the reform process by creating the “four singularities” – a single control list, a single information technology system, a single enforcement coordination agency, and a single licensing agency.
The Under Secretary testified that the task force created to develop the new export controls regime is currently implementing Phase II. This includes working to revise the U.S. Munitions List (USML) and the Commerce Control List (CCL) so that they use common technologies and structures.
The Under Secretary said that, “State, Commerce, and Treasury are also in the process of adopting the Department of Defense’s export licensing computer system, which will be part of a unified, cross-government computer system for export control purposes. As part of this effort, exporters eventually will use a single form for applications to State, Commerce and Treasury. Exporters also will be able to submit those applications through a single electronic portal. This isn’t rocket science; we are simply adopting modern business practices.”
To address commodity jurisdiction determination issues, the State Department is working with the Departments of Defense and Commerce to create a “bright line” between munitions and dual-use items, which will finally provide clear guidance to exporters on commodity jurisdiction issues. Ellen Tauscher stated that, “this is necessary to update our system that is still designed with the assumption that technologies are developed for the military and only later find their way into the commercial sector, whereas, today, that is often the exception rather than the rule.”
As part of the USML review, agencies are developing a process for transferring items from the USML to the CCL which includes deciding on the appropriate licensing requirements on items that are moved to the CCL.
The Under Secretary also noted the Obama Administration also wants to improve the process for notifying Congress about arms sales and the transfer of items from the United USML as over the years the “process has become lengthy and unpredictable.”
The Under Secretary concluded that Phase III will complete the reform process by creating the “four singularities” – a single control list, a single information technology system, a single enforcement coordination agency, and a single licensing agency.
Proposed ITAR Rule Amends Licensing Requirements for Replacement Parts and Incorporated Articles
03/15/11 12:44 AM
On
March 15, 2011, the Department of State
proposed to amend Parts
123 and 126 of the International Traffic in Arms
Regulations (ITAR) to reflect new policies
regarding coverage of replacement
parts/components and incorporated articles.
The current rule regarding parts and components requires additional licenses for licensed end-users and end-uses for systems and components already vetted in earlier licenses. The proposed rule adds a new section (§123.28) that eliminates the requirement for a license for parts and components for systems approved in a previous license. This proposed exemption applies only to exporters specifically identified in a previously approved authorization to export the end-item in question. It would not be applicable to upgrades of capabilities of the original end-item.
With respect to ITAR treatment of incorporated articles, the proposed new section of the ITAR (§126.19) lists three conditions under which a DDTC license is not required for the export or re-export of defense articles incorporated into an end-item that is subject to the EAR: (1) where the end-item would be “rendered inoperable” by the removal of the defense articles; (2) where no technical data for development or production are transferred with the defense article; and (3) where the incorporation of the defense article does not provide (or is not related to) a military application.
In addition, under the proposed rule, no license is required for the export or re-export of a defense article when that article would be rendered inoperable by removal form the end-item. A license would be required for the export of defense articles that are spare or replacement parts when they are embedded into a larger assembly such that they can be removed without destroying the defense articles.
Comments to the DDTC are due before April 14, 2011.
The current rule regarding parts and components requires additional licenses for licensed end-users and end-uses for systems and components already vetted in earlier licenses. The proposed rule adds a new section (§123.28) that eliminates the requirement for a license for parts and components for systems approved in a previous license. This proposed exemption applies only to exporters specifically identified in a previously approved authorization to export the end-item in question. It would not be applicable to upgrades of capabilities of the original end-item.
With respect to ITAR treatment of incorporated articles, the proposed new section of the ITAR (§126.19) lists three conditions under which a DDTC license is not required for the export or re-export of defense articles incorporated into an end-item that is subject to the EAR: (1) where the end-item would be “rendered inoperable” by the removal of the defense articles; (2) where no technical data for development or production are transferred with the defense article; and (3) where the incorporation of the defense article does not provide (or is not related to) a military application.
In addition, under the proposed rule, no license is required for the export or re-export of a defense article when that article would be rendered inoperable by removal form the end-item. A license would be required for the export of defense articles that are spare or replacement parts when they are embedded into a larger assembly such that they can be removed without destroying the defense articles.
Comments to the DDTC are due before April 14, 2011.
DDTC Posts Notice of Suspension of ITAR Licenses for Libya
02/28/11 10:05 PM
The
State Department’s Directorate of Defense Trade
Controls (DDTC) posted a notice on its website
announcing the suspension of all export licenses
issued pursuant to the authorities of the Arms
Export Control Act and the International Traffic
in Arms Regulations (22 CFR 120-130) until
further notice. Additionally, no exemptions may
be utilized for exports to Libya. Further
guidance related to exports to Libya will be
promulgated via a Federal Register
Notice.
DDTC Proposes Electronic Payment of Registration Fees
02/24/11 05:26 PM
On
February 24, 2011, the State Department’s
Directorate of Defense Trade Controls (DDTC) posted
in the Federal Register a proposed amendment
to
the International Traffic in Arms Regulations
(ITAR) to change the method of payment of
registration fees to electronic submission.
Comments on the proposed amendment are due by April 25, 2011.
Comments on the proposed amendment are due by April 25, 2011.
DDTC Posts the “Blue Lantern” Report on End-Use of Defense Articles and Services
02/23/11 05:21 PM
On
February 23, 2011, the State Department’s
Directorate of Defense Trade Controls (DDTC) has
posted the End-Use Monitoring of Defense
Articles and Defense Services Commercial Exports
FY2009 Report.
The report describes actions taken by the DDTC during fiscal 2009 to implement the “Blue Lantern” end-use monitoring program.
The “Blue Lantern” program monitors the end-use of defense articles and services exported through commercial channels and subject to Department of State licenses or certain other approvals under the AECA. The end-use monitoring includes pre-license, post-license, or post-shipment inquiries undertaken to verify the bona fides of proposed foreign consignees and end-users, to confirm the legitimacy of proposed transaction, and to verify that the recipient is complying with the requirements imposed by the U.S. Government with respect defense articles and services and that those items are being used for the purposes for which they are provided.
For FY2009, the Blue Lantern program initiated 774 inquiries in 104 countries. Of 649 cases closed in FY2009, 87 or 13% were determined to be “unfavorable,” meaning that the fact findings were not consistent with the information contained in the application or license. Problems identified during a pre and post-license check may result in denial or revocation of the license, removal of a party, or the license being returned without action. FY2009 Blue Lantern checks resulted in 10 directed disclosures and three referrals for possible criminal investigation.
The reasons for unfavourable check in FY2009 were refusal to cooperate (36%); derogatory information/foreign party deemed unreliable recipient of USM (30%); indications of diversion or unauthorized retransfer or re-export (13%); inability to confirm order or receipt of goods by end use (10%); party violating terms of license agreement (9%); warehousing or stockpiling (8%); foreign party (and-user and/or consignee) involved in transaction but not listed on license/application (6%); unauthorized brokering (6%); and inability to confirm existence of foreign party listed on license (1%).
Detailed explanations of findings are available in the full version of the report.
The report describes actions taken by the DDTC during fiscal 2009 to implement the “Blue Lantern” end-use monitoring program.
The “Blue Lantern” program monitors the end-use of defense articles and services exported through commercial channels and subject to Department of State licenses or certain other approvals under the AECA. The end-use monitoring includes pre-license, post-license, or post-shipment inquiries undertaken to verify the bona fides of proposed foreign consignees and end-users, to confirm the legitimacy of proposed transaction, and to verify that the recipient is complying with the requirements imposed by the U.S. Government with respect defense articles and services and that those items are being used for the purposes for which they are provided.
For FY2009, the Blue Lantern program initiated 774 inquiries in 104 countries. Of 649 cases closed in FY2009, 87 or 13% were determined to be “unfavorable,” meaning that the fact findings were not consistent with the information contained in the application or license. Problems identified during a pre and post-license check may result in denial or revocation of the license, removal of a party, or the license being returned without action. FY2009 Blue Lantern checks resulted in 10 directed disclosures and three referrals for possible criminal investigation.
The reasons for unfavourable check in FY2009 were refusal to cooperate (36%); derogatory information/foreign party deemed unreliable recipient of USM (30%); indications of diversion or unauthorized retransfer or re-export (13%); inability to confirm order or receipt of goods by end use (10%); party violating terms of license agreement (9%); warehousing or stockpiling (8%); foreign party (and-user and/or consignee) involved in transaction but not listed on license/application (6%); unauthorized brokering (6%); and inability to confirm existence of foreign party listed on license (1%).
Detailed explanations of findings are available in the full version of the report.
DDTC Seeks Public Comments on Revising the USML to a "Positive" List
12/10/10 01:55 PM
On
December 10, 2010, the State Department’s
Directorate of Defense Trade Controls (DDTC) issued
an advance notice of proposed
rulemaking (ANPRM) and is
seeking public comment on revisions to the to
the United States Munitions List (USML) that
would make it a ‘‘positive list’’ of controlled
defense articles, requests that the public
‘‘tier’’ defense articles based on the
Administration’s three-tier control criteria,
and identify those current defense articles that
the public believes do not fall within the scope
of any of the criteria’s tiers. A ‘‘positive
list’’ is a list that describes controlled items
using objective criteria rather than broad,
open-ended, subjective, or design intent-based
criteria.
DDTC is not seeking with this advance notice of proposed rulemaking (ANPRM) input on whether particular defense articles should or should not be controlled on the USML or whether any defense articles should be controlled differently. Rather, it is only seeking with this ANPRM input on how the USML can be revised so that it clearly describes what is subject to the jurisdiction of the International Traffic in Arms Regulations (ITAR), how defense articles are identified by tier, and what current defense articles do not fall within the scope of any of the tiers.
Comments must be received by the DDTC no later than February 8, 2011.
The ANPRM states in part that:
A key part of the Administration’s Export Control Reform effort is to review and revise both the ITAR and the CCL to enhance national security so that they: (1) Are ‘‘tiered’’ consistent with the criteria the U.S. Government has established to distinguish the types of items that should be controlled at different levels for different types of destinations, end-uses, and end-users; (2) create a ‘‘bright line’’ between the two lists to clarify jurisdictional determinations and reduce government and industry uncertainty about whether a particular item is subject to the jurisdiction of the ITAR or the EAR; and (3) are structurally ‘‘aligned’’ so that they can eventually be combined into a single control list.
The Administration has determined that these changes are necessary to better focus its resources on protecting those items that need to be protected, to end jurisdictional confusion between the ITAR and EAR, and to provide clarity to make it easier for exporters to comply with the regulations and for the U.S. Government to administer and enforce them.
In order to accomplish the three above-referenced tasks simultaneously, the USML and, to a lesser degree, the CCL must be revised so that they are aligned into ‘‘positive lists.’’ A ‘‘positive list’’ is one that describes controlled items using objective criteria such as horsepower, microns, wavelength, speed, accuracy, hertz or other precise descriptions rather than broad, open- ended, subjective, or design intent- based criteria.
As the U.S. Government continues its work on preparing proposed revisions to the USML, it seeks public input on how best to describe the USML in a positive manner. U.S. companies, trade associations, and individuals that produce, market, or export USML- controlled defense articles are generally well positioned to describe their articles positively and to provide comments on what are and are not clear descriptions of controls over the articles. Public comment at this stage of the USML review process also ensures that affected industry sectors have the opportunity to contribute and comment on a key element of Export Control Reform.
The following is a summary of the specific requests for public comment described in this notice:
1. Use objective criteria or thresholds, such as precise descriptions or technical parameters, that do not lend themselves to multiple interpretations by reasonable people.
2. Descriptions should not contain any (a) controls that use generic labels for ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end-items’’ or (b) other types of controls for specific types of defense articles because, for example, they were ‘‘specifically designed or modified’’ for a defense article, but should contain identification of those ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end-items’’ that do warrant enumerated control on the USML. Separately, the use of ‘‘specially designed’’ as a control criterion for the other ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end- items’’ should only be applied when required by multilateral obligations or when no other reasonable option exists.
3. Items are not to be listed on both the CCL and the USML unless there are specific technical or other objective criteria—regardless of the reason why any particular item was designed or modified—that distinguish between when an item is USML-controlled or when it is CCL-controlled.
4. In cases where technical characteristics are classified and need to be protected, the objective descriptions of the products controlled should be set at an unclassified level below the classified level.
5. Public input should include the recommended tier of control for the defense articles described using the tiering criteria in Part IV, Step 4 of the Guidelines in this notice.
6. The public is also requested to identify any current defense articles that do not fall within the scope of any of the criteria’s tiers, and provide an explanation why they believe that such items are not within the scope of the criteria.
DDTC is not seeking with this advance notice of proposed rulemaking (ANPRM) input on whether particular defense articles should or should not be controlled on the USML or whether any defense articles should be controlled differently. Rather, it is only seeking with this ANPRM input on how the USML can be revised so that it clearly describes what is subject to the jurisdiction of the International Traffic in Arms Regulations (ITAR), how defense articles are identified by tier, and what current defense articles do not fall within the scope of any of the tiers.
Comments must be received by the DDTC no later than February 8, 2011.
The ANPRM states in part that:
A key part of the Administration’s Export Control Reform effort is to review and revise both the ITAR and the CCL to enhance national security so that they: (1) Are ‘‘tiered’’ consistent with the criteria the U.S. Government has established to distinguish the types of items that should be controlled at different levels for different types of destinations, end-uses, and end-users; (2) create a ‘‘bright line’’ between the two lists to clarify jurisdictional determinations and reduce government and industry uncertainty about whether a particular item is subject to the jurisdiction of the ITAR or the EAR; and (3) are structurally ‘‘aligned’’ so that they can eventually be combined into a single control list.
The Administration has determined that these changes are necessary to better focus its resources on protecting those items that need to be protected, to end jurisdictional confusion between the ITAR and EAR, and to provide clarity to make it easier for exporters to comply with the regulations and for the U.S. Government to administer and enforce them.
In order to accomplish the three above-referenced tasks simultaneously, the USML and, to a lesser degree, the CCL must be revised so that they are aligned into ‘‘positive lists.’’ A ‘‘positive list’’ is one that describes controlled items using objective criteria such as horsepower, microns, wavelength, speed, accuracy, hertz or other precise descriptions rather than broad, open- ended, subjective, or design intent- based criteria.
As the U.S. Government continues its work on preparing proposed revisions to the USML, it seeks public input on how best to describe the USML in a positive manner. U.S. companies, trade associations, and individuals that produce, market, or export USML- controlled defense articles are generally well positioned to describe their articles positively and to provide comments on what are and are not clear descriptions of controls over the articles. Public comment at this stage of the USML review process also ensures that affected industry sectors have the opportunity to contribute and comment on a key element of Export Control Reform.
The following is a summary of the specific requests for public comment described in this notice:
- Public comments should be provided on a category-by-category basis.
- Within each category, public input should be further identified by groups A thru E as further described below.
- Public input should describe defense articles in a ‘‘positive’’ way:
1. Use objective criteria or thresholds, such as precise descriptions or technical parameters, that do not lend themselves to multiple interpretations by reasonable people.
2. Descriptions should not contain any (a) controls that use generic labels for ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end-items’’ or (b) other types of controls for specific types of defense articles because, for example, they were ‘‘specifically designed or modified’’ for a defense article, but should contain identification of those ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end-items’’ that do warrant enumerated control on the USML. Separately, the use of ‘‘specially designed’’ as a control criterion for the other ‘‘parts,’’ ‘‘components,’’ ‘‘accessories,’’ ‘‘attachments,’’ or ‘‘end- items’’ should only be applied when required by multilateral obligations or when no other reasonable option exists.
3. Items are not to be listed on both the CCL and the USML unless there are specific technical or other objective criteria—regardless of the reason why any particular item was designed or modified—that distinguish between when an item is USML-controlled or when it is CCL-controlled.
4. In cases where technical characteristics are classified and need to be protected, the objective descriptions of the products controlled should be set at an unclassified level below the classified level.
5. Public input should include the recommended tier of control for the defense articles described using the tiering criteria in Part IV, Step 4 of the Guidelines in this notice.
6. The public is also requested to identify any current defense articles that do not fall within the scope of any of the criteria’s tiers, and provide an explanation why they believe that such items are not within the scope of the criteria.
DDTC No Longer Accepts Paper Submissions of Agreements and Commodity Jurisdiction Requests
09/01/10 04:13 PM
The
U.S. Department of State Directorate of Defense
Trade Controls posted a reminder on its website
that:
Effective September 1, 2010, DDTC-Licensing no longer accepts unclassified paper submissions of Technical Assistance Agreements, Manufacturing License Agreements, and Warehouse Distribution Agreements (to include major amendments). All submissions must now be made electronically via D-Trade 2 utilizing the DSP-5 form. Guidelines for Preparing Electronic Agreements can be accessed here.
Effective September 3, 2010, DDTC-Policy no longer accepts paper submissions of Commodity Jurisdiction (CJ) requests. All CJ requests must now be made electronically via EFS utilizing the DS-4076 Commodity Jurisdiction Request Form. Instructions for CJ requests can be found here.
Effective September 1, 2010, DDTC-Licensing no longer accepts unclassified paper submissions of Technical Assistance Agreements, Manufacturing License Agreements, and Warehouse Distribution Agreements (to include major amendments). All submissions must now be made electronically via D-Trade 2 utilizing the DSP-5 form. Guidelines for Preparing Electronic Agreements can be accessed here.
Effective September 3, 2010, DDTC-Policy no longer accepts paper submissions of Commodity Jurisdiction (CJ) requests. All CJ requests must now be made electronically via EFS utilizing the DS-4076 Commodity Jurisdiction Request Form. Instructions for CJ requests can be found here.
State Department Clarifies Exemption for Technical Data under ITAR
08/27/10 11:16 PM
On
August 27, 2010, the U.S. State Department’s
Directorate of Defense Trade Controls (DDTC) issued
a final rule in the Federal
Register that clarifies an exemption for
technical data under International Traffic in
Arms Regulations (ITAR), 22 C.F.R. §125.4(b)(9).
The exemption as amended covers technical data, regardless of media or format, sent or taken by a U.S. person who is an employee of a U.S. corporation or a U.S. Government agency to a U.S. person employed by that U.S. corporation or to a U.S. Government agency outside the U.S.
The change is effective August 27, 2010.
The exemption as amended covers technical data, regardless of media or format, sent or taken by a U.S. person who is an employee of a U.S. corporation or a U.S. Government agency to a U.S. person employed by that U.S. corporation or to a U.S. Government agency outside the U.S.
The change is effective August 27, 2010.
Blackwater to Pay $42 Million to Settle Allegations of Violating U.S. Export Controls Regulations
08/23/10 10:53 PM
On
August 23, 2010, the U.S. State Department’s
Directorate of Defense Trade Controls (DDTC)
announced that Blackwater
Worldwide, a private security company now called
Xe Services (Blackwater), has entered into
a consent agreement
to
settle 288 violations of the Arms Export Control
Act (AECA) and International Traffic in Arms
Regulations (ITAR) in connection with
unauthorized export of defense articles,
including technical data, unauthorized provision
of defense services, violating the terms of
license authorizations, unauthorized sales
activity involving a proscribed country, failure
to maintain records involving ITAR-controlled
transactions and false statements,
misrepresentations, and omissions of material
facts.
According to the State Department, Blackwater sought training contracts from foreign governments and other foreign organizations without adhering closely to U.S. export regulations. Blackwater also shipped automatic weapons and other military equipment for use by its personnel in Iraq and Afghanistan in violation of export controls and in some cases sought to hide its actions. In one incident, Blackwater shipped weapons to Iraq hidden inside containers of dog food.
To settle the alleged violations, Blackwater must pay a civil penalty of $42 million, a portion of which will be suspended on the condition that Blackwater spends the funds on self-initiated or consent agreement-authorized remedial compliance measures.
According to the State Department, Blackwater sought training contracts from foreign governments and other foreign organizations without adhering closely to U.S. export regulations. Blackwater also shipped automatic weapons and other military equipment for use by its personnel in Iraq and Afghanistan in violation of export controls and in some cases sought to hide its actions. In one incident, Blackwater shipped weapons to Iraq hidden inside containers of dog food.
To settle the alleged violations, Blackwater must pay a civil penalty of $42 million, a portion of which will be suspended on the condition that Blackwater spends the funds on self-initiated or consent agreement-authorized remedial compliance measures.
Agreements to DDTC Must Be Submitted Via D-Trade 2 System
08/15/10 11:20 PM
Effective
September 1, 2010, Directorate of Defense Trade
Controls (DDTC) will no longer accept
unclassified paper submissions
of
Technical Assistance Agreements, Manufacturing
License Agreements, and Warehouse Distribution
Agreements (including major amendments).
After September 1, 2010, all submissions must be made electronically via D-Trade 2 utilizing the DSP-5 form. Paper submissions received after August 31 will be returned to the applicant will a letter from DDTC instructing the applicant to resubmit the agreement via the D-Trade 2 System. Minor amendments against active paper agreements may continue to be submitted on paper.
For information on submitting agreements electronically please reference the Guidelines for Preparing Electronic Agreements.
After September 1, 2010, all submissions must be made electronically via D-Trade 2 utilizing the DSP-5 form. Paper submissions received after August 31 will be returned to the applicant will a letter from DDTC instructing the applicant to resubmit the agreement via the D-Trade 2 System. Minor amendments against active paper agreements may continue to be submitted on paper.
For information on submitting agreements electronically please reference the Guidelines for Preparing Electronic Agreements.
DDTC Updates Guidelines
05/26/10 09:20 AM
DDTC
has updated its website to state that:
In addition, DDTC updated its Guidelines Regarding Company Names on License Documentation on May 3, 2010 and its Guidelines for Preparing Electronic Agreements, addition concerning electronic agreements submitted as Re-Baselined agreements on May 26, 2010.
Effective September 1, 2010 DDTC-Licensing will no longer accept unclassified paper submissions of Technical Assistance Agreements, Manufacturing License Agreements, and Warehouse Distribution Agreements (to include major amendments). After this date all submissions must be made electronically via D-Trade 2 utilizing the DSP-5 form. For information on submitting agreements electronically please reference the "Guidelines for Preparing Electronic Agreements" located on this website.
In addition, DDTC updated its Guidelines Regarding Company Names on License Documentation on May 3, 2010 and its Guidelines for Preparing Electronic Agreements, addition concerning electronic agreements submitted as Re-Baselined agreements on May 26, 2010.
DDTC Revises Guidelines for Preparing Electronic Agreements
04/26/10 12:15 AM
On
April 26, 2010, the Directorate of Defense Trade
Controls (DDTC) posted revised Guidelines for Preparing
Electronic Agreements.
DDTC Makes Announcement re: Commodity Jurisdiction Requests
02/17/10 03:22 PM
On
February 17, 2010, the Directorate of Defense Trade
Controls (DDTC) announced that until further notice
and effective immediately: “All CJ requests must be
mailed (FedEx, DRL, UPS, USPS, etc.) to DDTC.
Requests must include eight complete copies of a
fully executed DS-4076 CJ Form and all supporting
documentation. This statement is to temporarily
update the CJ Guidelines included
below.”
DDTC Updates Firearm Guidance
01/19/10 01:16 AM
DDTC Establishes New Guidance Regarding Temporary Import Violations DDTC Establishes New Guidance Regarding Temporary Import Violations DDTC Establishes New Guidance Regarding Temporary Import Violations DDTC Establishes New Guidance Regarding Temporary Import Violations DDTC Issues New Guidance on Temporary Import Violations
12/15/09 05:22 PM
The
Directorate of Defense Trade Controls (DDTC) has
published a notice on its website
regarding temporary imports of defense articles.
The notice provides that such imports require
the recipient to obtain a DSP-61 (a Temporary
Import License), or to claim the exemption under
22 CFR §123.4.
According to DDTC, the number of instances where a foreign person temporarily returns a defense article for repair or replacement without authorization to a U.S. person without their prior knowledge has increased. In this type of situation, the U.S. person is unable to coordinate the return and obtain the requisite DSP-61 license or claim the regulatory exemptions under the International Traffic in Arms Regulations (ITAR).
DDTC has established new guidance regarding unauthorized temporary imports and the subsequent exports to return the items to the foreign person. In such case, the U.S. person should investigate the nature and cause of violation and determine if the U.S. person had any responsibility for the violation.
If the U.S. person determines he was not responsible for a licensing violation, then in lieu of submitting a separate Voluntary Disclosure in accordance with ITAR §127.12, the U.S. person can submit a DSP-5 license application to return the defense article to the foreign person. The DSP-5 application must be accompanied by a transmittal letter which explains why the applicant believes they do not share any responsibility for the violation and the steps taken to make this determination; the identities and addresses of all persons known or suspected to be involved in the activities giving rise to the unauthorized temporary import; and any measures taken to prevent such reoccurrence.
According to DDTC, the number of instances where a foreign person temporarily returns a defense article for repair or replacement without authorization to a U.S. person without their prior knowledge has increased. In this type of situation, the U.S. person is unable to coordinate the return and obtain the requisite DSP-61 license or claim the regulatory exemptions under the International Traffic in Arms Regulations (ITAR).
DDTC has established new guidance regarding unauthorized temporary imports and the subsequent exports to return the items to the foreign person. In such case, the U.S. person should investigate the nature and cause of violation and determine if the U.S. person had any responsibility for the violation.
If the U.S. person determines he was not responsible for a licensing violation, then in lieu of submitting a separate Voluntary Disclosure in accordance with ITAR §127.12, the U.S. person can submit a DSP-5 license application to return the defense article to the foreign person. The DSP-5 application must be accompanied by a transmittal letter which explains why the applicant believes they do not share any responsibility for the violation and the steps taken to make this determination; the identities and addresses of all persons known or suspected to be involved in the activities giving rise to the unauthorized temporary import; and any measures taken to prevent such reoccurrence.
DDTC Amends Policy on Review Time for ITAR License Applications
12/03/09 04:39 PM
On
December 3, 2009, the Department of State's
Directorate of Defense Trade Controls (DDTC) issued
a notice in the Federal
Register adding a sixth national security
exception to the general 60 day license
adjudication deadline.
National Security Presidential Directive-56 signed on January 22, 2008, instructs the Department of State to complete the review and adjudication of license applications within 60 days of receipt, except in cases where national security exceptions apply. In addition to the five national security exceptions published in April 2008, Department of State’s experience has shown that an additional exception to the license review time is required.
Specifically, it has been noted that certain circumstances may require the Department of State to initiate a review of an established export policy relevant to license applications, which might result in cases that have been approvable before the review being returned without action to the applicant while the review is ongoing. In such situations, enforcing the 60-day deadline without ability to account for these types of situations might result in another applicant’s license, submitted after the first license but that had not reached the 60-day headline, being approved once the review is complete, thus creating an unlevel playing field. Therefore, the Directorate of Defense Trade Controls (DDTC) issued a notice in the Federal Register adding the sixth exception to account for this issue, and now the following national security exceptions are applicable:
(1) When a Congressional Notification is required (notification thresholds differ based on the dollar value, countries involved in the transaction and defense articles and services);
(2) When required Government Assurances have not been received;
(3) When end-use checks have not been completed;
(4) When the Department of Defense has not yet completed its review;
(5) When a Waiver of restrictions is required; and
(6) When a related export policy is under active review and pending final determination by the State Department.
National Security Presidential Directive-56 signed on January 22, 2008, instructs the Department of State to complete the review and adjudication of license applications within 60 days of receipt, except in cases where national security exceptions apply. In addition to the five national security exceptions published in April 2008, Department of State’s experience has shown that an additional exception to the license review time is required.
Specifically, it has been noted that certain circumstances may require the Department of State to initiate a review of an established export policy relevant to license applications, which might result in cases that have been approvable before the review being returned without action to the applicant while the review is ongoing. In such situations, enforcing the 60-day deadline without ability to account for these types of situations might result in another applicant’s license, submitted after the first license but that had not reached the 60-day headline, being approved once the review is complete, thus creating an unlevel playing field. Therefore, the Directorate of Defense Trade Controls (DDTC) issued a notice in the Federal Register adding the sixth exception to account for this issue, and now the following national security exceptions are applicable:
(1) When a Congressional Notification is required (notification thresholds differ based on the dollar value, countries involved in the transaction and defense articles and services);
(2) When required Government Assurances have not been received;
(3) When end-use checks have not been completed;
(4) When the Department of Defense has not yet completed its review;
(5) When a Waiver of restrictions is required; and
(6) When a related export policy is under active review and pending final determination by the State Department.
DDTC Publishes Proposed Rules for Comment
11/25/09 03:11 PM
On
November 25, 2009, the Department of State's
Directorate of Defense Trade Controls (DDTC)
published a proposed rule
to
amend Section 126.6 of the International Traffic
in Arms Regulations (ITAR) pertaining to U.S.
Government transfer programs and foreign-owned
military aircraft and naval vessels. Section
126.6 is being amended to clarify the particular
circumstances when a license is not required by
DDTC. DDTC will accept comments on this proposed
rule until January 25, 2010.
On November 25, 2009, the DDTC also published a proposed rule to amend Section 125.9 of the ITAR regarding an exemption for technical data, to clarify that the exemption covers technical data, including classified information, regardless of media or format, sent or taken by a U.S. person who is an employee of a U.S. corporation or a U.S. Government agency to a U.S. person employed by that U.S. corporation or to a U.S. Government agency outside the United States. DDTC will accept comments on this proposed rule until January 25, 2010.
On November 25, 2009, the DDTC also published a proposed rule to amend Section 125.9 of the ITAR regarding an exemption for technical data, to clarify that the exemption covers technical data, including classified information, regardless of media or format, sent or taken by a U.S. person who is an employee of a U.S. corporation or a U.S. Government agency to a U.S. person employed by that U.S. corporation or to a U.S. Government agency outside the United States. DDTC will accept comments on this proposed rule until January 25, 2010.
DDTC Allows Electronic Submission of Agreements for All U.S. Applicants
10/07/09 02:39 PM
On
October 7, 2009, the Directorate of Defense Trade
Controls (DDTC) announced that beginning
October 19, 2009, DDTC will alllow all U.S.
applicants to submit agreements electronically
via the D-Trade 2 application. DDTC states that
this electronic system will employ the D-Trade 2
Production application as the means for
submitting, reviewing, and approving agreement
proposals. It will incorporate the DSP-5 tool as
the primary instrument for transitioning
agreements and their respective amendments from
one phase of the adjudication process to the
next and will negate the need for DDTC to issue
a separate authorization letter upon approval of
a case.
DDTC states that only new agreements and re-baselined agreements may be submitted initially using the D-Trade 2 production systems. Applicants are not authorized to submit an electronic amendment proposal to an approved paper agreement. Once an electronic agreement is approved, electronic amendments to that approval may be submitted.
DDTC encourages all applicants to thoroughly review the Guidelines for Preparing Electronic Agreements (as of October 7, 2009). Additionally, DDTC is requesting that any U.S. applicant not previously approved to submit electronic agreements as part of the Test Phase submit only one initial electronic agreement proposal. Once that application has cleared DDTC and has been forwarded for staffing to additional agencies, the applicant can openly submit applications as required. DDTC states that this initial submission "pause" will aloow DDTC analysts to confirm submissions are complete and accurate and minimize the number of potential applications being returned without action.
Both paper and electronic submission of agreement proposals will continue to be accepted. However, DDTC anticipates making the sumbission of electronic agreement applications mandatory for all applicants in Fall 2010.
DDTC states that only new agreements and re-baselined agreements may be submitted initially using the D-Trade 2 production systems. Applicants are not authorized to submit an electronic amendment proposal to an approved paper agreement. Once an electronic agreement is approved, electronic amendments to that approval may be submitted.
DDTC encourages all applicants to thoroughly review the Guidelines for Preparing Electronic Agreements (as of October 7, 2009). Additionally, DDTC is requesting that any U.S. applicant not previously approved to submit electronic agreements as part of the Test Phase submit only one initial electronic agreement proposal. Once that application has cleared DDTC and has been forwarded for staffing to additional agencies, the applicant can openly submit applications as required. DDTC states that this initial submission "pause" will aloow DDTC analysts to confirm submissions are complete and accurate and minimize the number of potential applications being returned without action.
Both paper and electronic submission of agreement proposals will continue to be accepted. However, DDTC anticipates making the sumbission of electronic agreement applications mandatory for all applicants in Fall 2010.
DDTC Publishes Web Updates
09/30/09 05:54 PM
The
State Department's Directorate of Defense Trade
Controls (DDTC) published several updates to its
website in September:
- Updated Guidance for Licensing of Foreign Persons Employed by a U.S. Person (9.30.09)
- DDTC announcement that it will no longer process DSP Amendments for Value or Quantity Changes (9.30.09)
- Announcement of a New Commodity Jurisdiction (CJ) Form, DS-4076, is available for use, which will be processed as a paper document, but in the future, will be required to be submitted electronically (9.30.09)
- DSP119 forms may now only be used to amend DSP85 licenses. To amend a DSP-5, DSP-61 or DSP-73 license, the applicant must submit the companion amendment form via DTRADE-2 (9.25.09)
- DSP-83 Requirements for Licensing of Chemical Agent Resistant Coatings (CARC) Paint - Category XIV(f)(5) (9.14.09)
- The List of Statutorily Debarred Parties has been updated (9.14.09)
- Use of USML Category XXI now requires a copy of a DDTC Commodity Jurisdiction identifying USML Cat XXI or an official letter from the Director of the Office of Defense Trade Controls Policy granting permission to use Cat XXI (9.08.09)
DTrade 2 is Now Operational
05/16/09 01:00 AM
The
U.S. Department of State announced that, starting
May 16, 2009, exporters must use the DTrade 2
application to submit all new license
submissions. The State Department announced that
licensing submissions will no longer be accepted
via DTrade 1, and will be returned without
action, directing the applicant to the DTrade2
application.
Exporters can still use DTrade 1 to track status and to attach data to pre-existing cases. Cases submitted to the Directorate of Defense Trade Controls (DDTC) via the DTrade 1 prior to May 16, 2009, will be processed until the review of the submission is complete.
The information about the new licensing application, new forms, and guidelines are available on the DTrade Information Center website.
Exporters can still use DTrade 1 to track status and to attach data to pre-existing cases. Cases submitted to the Directorate of Defense Trade Controls (DDTC) via the DTrade 1 prior to May 16, 2009, will be processed until the review of the submission is complete.
The information about the new licensing application, new forms, and guidelines are available on the DTrade Information Center website.
D-Trade License Application or Amendment Subject to New Requirements
04/16/09 03:29 PM
On
April 16, 2009, U.S. Department of State (DOS)
Directorate of Defense Trade Controls (DDTC)
launched a new DTrade2
application and database.
While the old DTrade will remain active to track
or upload supplemental information to
applications submitted prior to April 16, 2009,
the new DTrade2 system must be used for all new
license applications. DDTC will return all
submissions uploaded to the old DTrade system
after April 16, 2009 without action.
Several important changes are effective with the launch of the DTrade2:
Applicants who routinely use subsidiary names or “doing business as” names on the D-Trade submission must now use the DDTC-approved registrant/applicant name identifications. This name can be found on the addressee line of the registration letter sent by the Office of Defense Trade Controls Compliance at the time of registration or renewal.
Users unsure of their DDTC-approved name must contact their central export control office to obtain the information. DDTC will not provide this information to D-Trade users over the phone or via e-mail.
New and updated forms are available on DDTC’s website.
Several important changes are effective with the launch of the DTrade2:
- The new system will use the new license amendment form (DSP-6; DSP-62; and DSP-74);
- The DTrade2 will no longer accept paper DSP-119 forms. DDTC also intends to discontinue usage of ELLIENet for DSP-119 submission, however, EELIENet submissions will be available for approx. 60 days after DTRade2 launch; and
- All D-Trade users must use their DDTC-approved registrant/applicant name which corresponds to their DDTC registration record before an application or amendment will be accepted by the new system. D-Trade request will be checked against DDTC’s registration records to confirm that the name submitted on the request matches DDTC’s official records. Applications or amendments that do not match the records will be automatically rejected. DDTC explains that this extra level of security will aid in prevention of improper third party use of a registrant’s name, their code or licensing privileges.
Applicants who routinely use subsidiary names or “doing business as” names on the D-Trade submission must now use the DDTC-approved registrant/applicant name identifications. This name can be found on the addressee line of the registration letter sent by the Office of Defense Trade Controls Compliance at the time of registration or renewal.
Users unsure of their DDTC-approved name must contact their central export control office to obtain the information. DDTC will not provide this information to D-Trade users over the phone or via e-mail.
New and updated forms are available on DDTC’s website.
DDTC Updates Agreements Guidelines
04/06/09 04:31 PM
On
April 6, 2009, the Directorate of Defense Trade
Controls (DDTC) updated its Agreements Guidelines (Revision
1A - Interim Update) on its website.
The DDTC also provided a Summary of
Changes. In that
document, DDTC states:
This update is being published to correct substantive and administrative errors identified in the “Guidelines for Preparing Agreements – Revision 1.” This update is not the result of changes or modifications to DTC policies or procedures.
DDTC Posts 2007 End Use Monitoring Report
02/10/09 05:29 PM
On
February 9, 2009, the Directorate of Defense Trade
Controls (DDTC) posted to its website its
End Use Monitoring Report for
2007. The report
begins:
Finally, it was interesting to note that the DDTC found various reasons for unfavorable determinations, with the two largest categories being: (1) the failure of applicants to properly identify foreign parties on the license application, and (2) a party violated terms of the license or agreement. The DDTC noted that the failure to identify all parties to a license application creates the increased likelihood of diversion to unauthorized end-users and end-use.
The report goes on to state:This report describes actions taken by the Department of State during the past fiscal year to implement the “Blue Lantern” end-use monitoring program. The Blue Lantern program, operated in accordance with section 40A of the Arms Export Control Act, as Amended (AECA), monitors the end-use of commercially exported defense articles, defense services, and related technical data subject to licensing or other authorizations under section 38 of the AECA
Additionally, the report states:The Blue Lantern program is managed within PM/DDTC by the Office of Defense Trade Controls Compliance’s (DTCC) Research and Analysis Division (RAD). Blue Lantern end-use monitoring entails pre-license, post license or post-shipment checks undertaken to verify the legitimacy of a transaction and to provide “reasonable assurance that – i) the recipient is complying with the requirements imposed by the United States Government with respect to use, transfers, and security of defense articles and defense services; and ii) such articles and services are being used for the purposes for which they are provided.”
Last fiscal year, PM/DDTC completed action on approximately 81,000 license applications and other export requests. Blue Lantern checks are not conducted randomly, but are rather the result of a careful selection process to identify transactions that appear most at risk for diversion or misuse. License applications and other requests undergo review by licensing officers and compliance specialists, who check case details against established criteria for determining potential risks: unfamiliar foreign parties, unusual routing, overseas destinations with a history of illicit activity or weak export/customs controls, commodities not known to be in the inventory of the host country’s armed forces and other indicators of concern. The information derived from Blue Lantern checks helps PM/DDTC licensing officers and compliance specialists assess risks associated with the export of certain defense articles and services to various countries and regions, and provides significant insight into the reliability of companies and individuals involved in defense procurement overseas.
Finally, it was interesting to note that the DDTC found various reasons for unfavorable determinations, with the two largest categories being: (1) the failure of applicants to properly identify foreign parties on the license application, and (2) a party violated terms of the license or agreement. The DDTC noted that the failure to identify all parties to a license application creates the increased likelihood of diversion to unauthorized end-users and end-use.
DDTC Updates Agreement Guidance
01/30/09 05:32 PM
Optics Company Agrees to a $25 Million Civil Penalty for ITAR Violations
01/30/09 05:32 PM
On
December 5, 2008, Qioptiq S.a.r.l., a Luxemborg
optics company, agreed to a
Consent Agreement with the
Directorate of Defense Trade Controls (DDTC)
involving a $25 million civil penalty. The
Proposed Charging Letter
outlines
the facts and circumstances surrounding the 163
alleged violations of the Arms Export Control Act
(AECA). DDTC has also published the
Order in the matter and
an
Annex of Compliance
Measures.
Qioptiq, an optics company with operations in the U.S., Singapore, UK, Germany and Hungary, had acquired Thales High Technology Optic Group companies. These companies were primarily involved in the manufacturing of quality optic components for use in both commercial and military applications. A large portion of Thales Singapore's business was and continues to be the manufacturing of military optics used in night vision equipment. U.S. night vision equipment manufacturers relied heavily on the Singaporean facility for supplying optical components, sub-assemblies, and related parts. Thales Singapore was an important supplier to ITT Night Vision.
Qioptiq, an optics company with operations in the U.S., Singapore, UK, Germany and Hungary, had acquired Thales High Technology Optic Group companies. These companies were primarily involved in the manufacturing of quality optic components for use in both commercial and military applications. A large portion of Thales Singapore's business was and continues to be the manufacturing of military optics used in night vision equipment. U.S. night vision equipment manufacturers relied heavily on the Singaporean facility for supplying optical components, sub-assemblies, and related parts. Thales Singapore was an important supplier to ITT Night Vision.
State Department Posts New Registration Form DS-2032
11/25/08 10:28 PM
On
November 25, 2008, the State Department's
Directorate of Defense Trade Controls (DDTC)
announced that the Office of Management and Budget
(OMB) approved the new registration form DS-2032
and it is now posted on its website
(here). The new form
and all attachments can be found
here. The DDTC
provides guidance on Preparing a
Registration Package as well.
The new form reflects the DTC Increases Registration Fees and Changes Registration Renewal Period">recent changes the DDTC made to its registration fees and periods on September 25, 2008.
The new form reflects the DTC Increases Registration Fees and Changes Registration Renewal Period">recent changes the DDTC made to its registration fees and periods on September 25, 2008.
DDTC Increases Registration Fees and Changes Registration Renewal Period
09/26/08 08:37 PM
On
September 25, 2008, the U.S. Department of State's
Directorate of Defense Trade Controls (DDTC)
published a final
rule amending the
International Traffic in Arms (ITAR) to increase
registration fees, change the registration
renewal period, and make other minor
administrative changes. The DDTC states that to
align the registration fees with the cost of
licensing, compliance, and other related
activities, the DDTC is adopting a three-tier
registration fee schedule.
The first tier fee structure is set at $2,250 per year for registrants who are renewing a registration, required to register by law, and for whom the DDTC has not yet reviewed, adjudicated or issued a response to any application during the twelve-month period ending 90 days prior to the expiration of their current registration.
The second tier is for registrants for whom DDTC has reviewed, adjudicated or issued a response to between one and ten applications during the twelve-month period ending 90 days prior to the expiration of their current registration. For this tier, registrants will pay a set fee of $2,750 per year.
The third tier is for registrants for whom DDTC has reviewed, adjudicated or issued a response more than ten applications during the twelve-month period ending 90 days prior to the expiration of their current registration. For this tier, registrants will pay a set fee of $2,750 per year plus an additional fee that is based on multiplying $250 by the number of applications for which DDTC has reviewed, adjudicated or issued a response during the twelve months ending 90 days prior to the expiration of the current registration.
The first tier fee structure is set at $2,250 per year for registrants who are renewing a registration, required to register by law, and for whom the DDTC has not yet reviewed, adjudicated or issued a response to any application during the twelve-month period ending 90 days prior to the expiration of their current registration.
The second tier is for registrants for whom DDTC has reviewed, adjudicated or issued a response to between one and ten applications during the twelve-month period ending 90 days prior to the expiration of their current registration. For this tier, registrants will pay a set fee of $2,750 per year.
The third tier is for registrants for whom DDTC has reviewed, adjudicated or issued a response more than ten applications during the twelve-month period ending 90 days prior to the expiration of their current registration. For this tier, registrants will pay a set fee of $2,750 per year plus an additional fee that is based on multiplying $250 by the number of applications for which DDTC has reviewed, adjudicated or issued a response during the twelve months ending 90 days prior to the expiration of the current registration.
State Amends ITAR to Terminate Arms Sanctions Against Rwanda
09/26/08 08:24 PM
On
September 25, 2008, the U.S. Department of State
published a final
rule amending the
International Traffic in Arms Regulations (ITAR)
with respect to Rwanda. Through the final rule,
the State Department is removing Rwanda from its
regulations on prohibited exports and sales to
certain countries as a result of United Nations
Security Council (UNSC) Resolution 1823, which
terminated remaining arms sanctions against
Rwanda.
DDTC Publishes Updated Guidance on Licensing of Foreign Persons
09/22/08 07:45 PM
Defense Trade Advisory Group to Meet October 21, 2008
09/10/08 07:35 PM
On
September 9, 2008, the Department of State
published a Notice of Meeting
for
the Defense Trade Advisory Group (DTAG). The
DTAG will meet on October 21, 2008 from 9:30
a.m. - 1 p.m. at the U.S. Department of State,
Harry S. Truman Building, Washington, D.C. Entry
and registration will begin at 8:45 a.m.
As access to the Department of State facilities is restricted, persons wishing to attend the meeting must notify the DTAG Executive Secretariat by COB, Thursday, October 14, 2008.
As access to the Department of State facilities is restricted, persons wishing to attend the meeting must notify the DTAG Executive Secretariat by COB, Thursday, October 14, 2008.
State/DDTC Updates Guidance Documents
07/07/08 11:45 AM
On
July 1 - 3, 2008, the State Department's
Directorate of Defense Trade Controls (DDTC)
updated its website with new
guidance documents. Specifically, the DDTC
posted updated Agreements
Guidelines on July 1,
2008; a listing of countries by
DoS regional bureaus,
licensing
review checklists, and
updated licensing
FAQs on July 2,
2008; and updated its DDTC Outreach
page on July 3,
2008.
State Department Posts Comments Received on Proposed Rule
05/22/08 03:22 PM
On April
11, 2008, the State Department's Directorate of
Defense Trade Controls (DDTC) published a
notice
in
the Federal Register regarding a proposed rule
intended to clarify the control of aircraft
parts and components under Section 17(c) of the
Export Administration Act of 1979 (EAA). In the
notice, the DDTC states that there have been an
increasing number of Commodity Jurisdiction (CJ)
requests for certain basic parts and components
having a long history of use on both civil and
military aircraft. DDTC stated, "The intent of
this notice is to make it clear that these parts
and components are not subject to the
jurisdiction of the Department of State and to
restate the Department's longstanding practice
of using the CJ process of using the CJ process
to determine the applicability of the criteria
of Section 17(c) of the EAA ("Section 17(c)") in
cases where there is uncertainty."
In the notice, DDTC stated it would accept comments to the proposed rule until May 12, 2008. On May 22, 2008, DDTC posted the comments it received to the proposed rule here. Comments were received from the following parties:
In the notice, DDTC stated it would accept comments to the proposed rule until May 12, 2008. On May 22, 2008, DDTC posted the comments it received to the proposed rule here. Comments were received from the following parties:
- Aerospace Industries Association
- Airbus
- Alcoa
- Aviation Suppliers Association
- The Boeing Company
- Commerce/BIS Transportation and Related Equipment Technical Advisory Committee
- deButts, Thomas, Pillsbury, Winthrop, Shaw, Pittman, LLP
- Emerson Power Transmission
- Goodrich Corporation
- Industrial Fasteners Institute
- Korry Electronics
- Lockheed Martin Corporation
- Rep. Donald Mazullo, U.S. House of Representatives
- Modification and Replacement Parts Association
- William Root
- Safran USA
DDTC Amends Rules on Transfer of Technical Data
12/19/07 05:41 PM
On
December 19, 2007, the State Department's
Directorate of Defense Trade Controls (DDTC) issued
a final rule
amending
the International Traffic in Arms Regulations
(ITAR) to allow access to defense articles and
services to certain dual and third country
nationals under technical assistance agreements
(TAAs) or manufacturing licensing agreements
(MLAs) without having to execute individual Non
Disclosure Agreements (NDAs).
Previously, section 124.8(5) of the ITAR precluded any retransfer of defense articles (hardware or technical data) or defense services pursuant to an approved TAA/MLA to third countries or nationals of third countries unless specifically authorized in the agreement or for which prior written approval has been granted by the DDTC. The DDTC considers a third country national to be an individual from a country other than the country which is the foreign signatory to the agreement. DDTC also considers a third country national to be a dual national if he holds nationality from more than one country. In addition to citizenship, DDTC considers country of birth a factor in determining nationality.
Moreover, prior to the amendment, third country/dual nationals authorized under a TAA/MLA were required to execute NDAs prior to receiving access to the defense articles or services.
Under the amended regulations, the U.S. applicant may request further release of technical data and defense services and access to defense articles exported pursuant to or produced as a result of the TAA/MLA to third country/dual national employees of the foreign signatory who are nationals of countries that are members of the North Atlantic Treaty Organization (NATO), the European Union (EU), Australia, Japan, New Zealand, and Switzerland. These procedural changes would also apply to employees of sub-licensees authorized under the agreement. Furthermore, the execution of a NDA would no longer be required for such third country/dual nationals.
The rule is effective on December 19, 2007.
Previously, section 124.8(5) of the ITAR precluded any retransfer of defense articles (hardware or technical data) or defense services pursuant to an approved TAA/MLA to third countries or nationals of third countries unless specifically authorized in the agreement or for which prior written approval has been granted by the DDTC. The DDTC considers a third country national to be an individual from a country other than the country which is the foreign signatory to the agreement. DDTC also considers a third country national to be a dual national if he holds nationality from more than one country. In addition to citizenship, DDTC considers country of birth a factor in determining nationality.
Moreover, prior to the amendment, third country/dual nationals authorized under a TAA/MLA were required to execute NDAs prior to receiving access to the defense articles or services.
Under the amended regulations, the U.S. applicant may request further release of technical data and defense services and access to defense articles exported pursuant to or produced as a result of the TAA/MLA to third country/dual national employees of the foreign signatory who are nationals of countries that are members of the North Atlantic Treaty Organization (NATO), the European Union (EU), Australia, Japan, New Zealand, and Switzerland. These procedural changes would also apply to employees of sub-licensees authorized under the agreement. Furthermore, the execution of a NDA would no longer be required for such third country/dual nationals.
The rule is effective on December 19, 2007.
DDTC Amends Voluntary Disclosure Rules
12/14/07 09:07 PM
On
December 13, 2007, the Department of State's
Directorate of Defense Trade Controls (DDTC)
published a final
rule amending
the Voluntary Disclosure provisions of the
International Traffic in Arms Regulations
(ITAR). Section
127.12 of
the ITAR governs Voluntary Disclosure. The new
rule amends section 127.12 in 4 major respects:
- The new rule imposes a 60-calendar day deadline after the initial notification to submit a full disclosure. Previously, there was no set time limit for a party to submit a full disclosure after an initial notification to DDTC. Under the new rule, a party may request an extension to the 60-calendar day extension, and, in certain cases, DDTC may require the requester to certify in writing that the full disclosure will be submitted within a specified time period. Failure to do any of the preceding may result in the DDTC deciding not to consider the initial notification as a mitigating factor in determining the appropriate disposition of the violation.
- The new rule requires the party making the disclosure to provide specific information including, but not limited to, names and addresses of individuals involved in the violation, and a precise description of the nature and extent of the violation.
- The new rules also require that the disclosing party describe corrective actions already undertaken that clearly identifies the new compliance initiatives implemented to address the causes of the violations set forth in the voluntary disclosure and any internal disciplinary action taken; and how these corrective actions are designed to deter those particular violations from occurring again.
- Finally, the new rules provide that, in cases of "a major violation, a systematic pattern of violations, or the absence of an effective compliance program," DDTC may require that the disclosure be signed by a "senior officer."