Archive for the ‘DDTC’ Category


Apr

3

U.N. Approves Arms Trade Treaty


Posted by at 4:58 pm on April 3, 2013
Category: Arms ExportDDTC

By Stefano Corso http://commons.wikimedia.org/wiki/File:UN_building.jpg (Attribution)Yesterday the United Nations, by a lopsided 154-3 vote, approved the Arms Trade Treaty. The three “no” votes came from Iran, Syria and North Korea. Joining with those three countries in opposing the treaty will likely be the U.S. Congress, seemingly oblivious to the irony of casting its lot with these three rogue nations.

Much of the opposition centers on fears that the treaty will allow a transnational body to impose restrictions on domestic sales of guns in the United States. However, the preamble dismisses this concern at the outset, noting that the treaty acknowledges

the sovereign right of any State to regulate and control conventional arms exclusively within its territory, pursuant to its own legal or constitutional system. …

Moreover, the treaty only impacts exports and imports of arms and has no application to any member state’s purely domestic or internal regulation (or non-regulation) of weapons and firearms.

Of primary significance here, however, is that the treaty does not require the United States to do anything other than what it is required to do, and already does, under its own Arms Export Control Act (“AECA”), namely to establish a control list, to regulate exports of items on that control list, and to assure that export licenses are not granted to permit exports of arms to be used in violation of international agreements or to commit genocide or crimes against humanity. These are arguably not any different from the factors set forth in section 38(a)(2) of the AECA to be considered by DDTC in granting export licenses.

What this means is that the real impact of the treaty will be to require countries that do not now regulate their arms exports to start doing so. This would create a more level playing field for U.S. exporters who must get licenses for all weapons exports but who compete against suppliers in other countries which do not regulate weapons export.  It seems hard to argue against that result.

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Mar

25

Seriously Bad People Who Have Done Seriously Bad Things. . .


Posted by at 6:41 pm on March 25, 2013
Category: DDTC

Blue Lantern?Have you had a license application pending at the Directorate of Defense Trade Controls (“DDTC”) to export a defense article mysteriously denied?  If so, you might have been “blue lanterned,” or, more accurately, the end user might have been “blue lanterned.”

The oddly and opaquely named “Blue Lantern” program at DDTC refers to a process whereby U.S. embassy officials abroad and other domestic government officials conduct investigations into proposed end users mentioned in DDTC license applications.   The result is that sometimes a source whispers something derogatory about the end user into the investigators ear and, well, that’s the end of that license application.

Every year DDTC issues a report on its Blue Lantern report which provides some interesting information and statistics on the program, although regrettably always leaving the origin of the program’s name shrouded in mystery.*  This year’s report was just released and there are some interesting tidbits buried in it.

The report indicated that in 2012, a total of 820 Blue Lantern checks were initiated, up from 783 in 2011 and 536 in 2010. Of those, 20 percent resulted in unfavorable determinations. Interestingly, the report noted that the unfavorable rate for inquiries conducted in Europe was 27 percent, among the highest for any region, even though historically the rate of unfavorable determinations in Europe is among the lowest of all the regions. The report explained the discrepancy as

primarily due to thirty unfavorable checks involving a single entity that failed to sufficiently cooperate with DTCC’s inquiries and also revealed stockpiling concerns.

Late in the report it is revealed that the commodities produced by this “single entity” were spacecraft systems, which may give alert readers enough information to speculate as to who that single entity might be.

My favorite unfavorable determinations, however, had to be one involving a Central American firearms dealer who sold to an individual “known to resell firearms from his car” and the one involving “an Eastern European individual who attempted to acquire a weapon simulator under the premise of using it in a home theatre gaming system.” (And here I thought I had every possible gadget in my home theatre system!)


*See previous posts here and here about the possible origin of “Blue Lantern” as the program name.

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Jan

30

It’s Always Harder the Second Time Around


Posted by at 6:08 pm on January 30, 2013
Category: DDTCPart 122

Clickenbeard HQWell, today is truly a red letter day in the annals of ITAR registration puffery. For the first time ever (at least that I’ve seen), we have a company boasting that it has received ITAR re-certification. This blog has reported plenty of instances of companies that breathlessly announce that they have received “certification” upon their first ITAR registration filing, but until now no company has tried to make a news event from filing their renewal of that registration.

The proud company is Illinois-based Clickenbeard & Associates, Inc., and their press release really slathers it on thickly:

Clinkenbeard … has received official International Traffic in Arms Regulations (ITAR) re-certification from the United States Department of State, Bureau of Political-Military Affairs.

… Companies receiving this certification demonstrate that they have knowledge and understanding to fully comply with the AECA and ITAR as well as having corporate procedures and controls in place to ensure compliance.

“This re-certification is evidence of our commitment and ability to safeguard all defense- and government-related data for our customers and our country. Further, it demonstrates our government‘s trust in our doing so,” explains Steve Helfer, Clinkenbeard general manager.

I particularly like the statement that registration renewal demonstrates the “government’s trust” in Clickenbeard. To repeat (for the, oh, four thousandth time), all that ITAR registration (or re-registration for that matter) demonstrates is that the company had the filing fee in its bank account, could figure out how to fill out a form and send it to DDTC, and was able to pay for the postage required to send it in. Registration numbers are given by DDTC to everyone who can do those three things, even if they don’t know the difference between “registration” and “certification,”  between an export and a deemed export or between a DSP-83 and a salt shaker.

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Jan

4

Washington Post Jumps On The “ITAR-Certified” Bandwagon


Posted by at 3:23 pm on January 4, 2013
Category: DDTCPart 122

Washington PostBuried among all the articles on the recent events on the Hill, the Washington Post snuck in an article on the White House’s export control reform initiative and on export controls in general. Unfortunately, but not surprisingly, the reporter gets tangled up in the complexities of the current export control regime and muffs a few things.

The worst of these errors was the simplest one to avoid. As regular readers of this blog know, we have spilled several million gallons of digital ink (or should I say illuminated millions of computer screen pixels?) decrying and ridiculing the concept that the required registration under the International Traffic in Arms Regulations (“ITAR”) for manufacturers of defense articles represents some kind of “certification” of the manufacturer.   Instead, registration signifies nothing more than that the manufacturer filled out a  brief form disclosing certain corporate information and paid the required fee. It is not, by any stretch, an “ITAR certification.”

But now this “certification” canard has wriggled its way into the august pages of Washington’s paper of record:

Building the boards in the United States costs Kincaid “100 to 400 percent” more, he says, but he did not hesitate to fill out the paperwork five years ago and pay the fee, which is now more than $2,000, to become an ITAR-certified manufacturer because he appreciated the made-in-the-United-States sentiment and thought that it might “bring some of the work back.”

Sigh.

And then there’s this:

So a defense contractor sending equipment for U.S. military use on a battle­field abroad must obtain its authorization to “export” its product to a foreign country.

No. If the manufacturer sells the equipment to the U.S. military and they take it abroad, the manufacturer doesn’t need a license.

And this:

As Abrams sees it, the trouble for businesses like Kincaid’s isn’t compliance with export controls but the uneven application of the controls. For instance, her organization has seen identical bid requests “with one stamped ITAR and one not stamped ITAR,” she says. So if one company complies and the other does not, then the noncompliant manufacturer seizes a significant competitive advantage, assuming no one comes calling from the departments of State, Commerce or Treasury — three agencies with different computer systems, missions and cultures, but all with responsibilities in export controls.

Again, no. Neither Commerce nor Treasury would have any responsibilities or jurisdiction over the unauthorized export of ITAR-controlled items.

I spent some time speaking with the reporter on this story and, apparently, did not do a good enough job communicating to him some export control basics, so I take part of the blame for these last two errors. But, I made a big deal with him about “certification” versus “registration,” so there was no excuse for that mistake.

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Nov

29

New Rules Might Require Export Licenses For Certain Corporate Security Systems


Posted by at 5:48 pm on November 29, 2012
Category: DDTCUSML

Unattended Ground SensorYesterday the Directorate of Defense Trade Controls (“DDTC”) released its proposed revisions to Category XI of the United States Munitions List (“USML”). Category XI covers military electronics. For the most part, the proposed revisions implement the laudable policy of converting the USML into a “positive” list which will cover items with specific performance characteristics rather than, as is currently the case, cover a broad category of items “specifically designed, modified or configured for military application.”

So, for example, Category XI now covers “underwater sound equipment to include active and passive detection, identification, tracking and weapons control equipment” that are “specifically designed, modified or configured for military application.” Under the proposed new rule, to be covered the underwater sound equipment must meet certain specific requirements such as being able to classify surface vessels and submarines and having certain defined characteristics, such as using an operating frequency less than 20kHz. An item that might have been modified for military purposes (whatever that means!) and that doesn’t meet those characteristics wouldn’t be on the USML at all.

In addition to adding specificity to the current types of military electronics covered by Category XI, the proposed rules add some new types of military equipment. Of most significant interest is the new Category XI(a)(8) which covers:

(8) Unattended ground sensor (UGS) systems or equipment having all of the following:
(i) Automatic target detection;
(ii) Automatic target tracking, classification, recognition, or identification;
(iii) Self-forming or self-healing networks; and
(iv) Self-localization for geo-locating targets;

The problem here is that none of these terms are defined and that they aren’t even modified by the qualifier that they were “specifically designed, modified or configured for military application.” Certainly the language seems broad enough to cover certain corporate security systems, thereby creating a potential export problems for the company if it has non-U.S. employees with visual access to these systems. This problem would be alleviated, in this instance at least, by including unattended ground sensors if they are ” “specifically designed, modified or configured for military application.”

For an interesting account of the history and development of unattended ground sensor systems, going back to when the U.S. deployed them along the Ho Chi Minh trail in 1966, I highly recommend Noah Shachtman’s excellent article “The Rock That Could Spy On You For Decades” in Wired. Interestingly, that article quotes an industry spokesman saying that the next big market for UGS systems is here in the United States for, among other things, corporate headquarters security.

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Copyright © 2012 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)