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Defense Security Technology Administration Overview of Licensing

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Overview of Licensing Todd E. Willis Division Chief, Dual-Use Licensing Defense Technology Security Administration U.S. Department of Defense Way Ahead Single ... – PowerPoint PPT presentation

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Title: Defense Security Technology Administration Overview of Licensing


1
Defense Security Technology
Administration Overview of Licensing
  • Todd E. Willis
  • Division Chief, Dual-Use Licensing
  • Defense Technology Security Administration
  • U.S. Department of Defense

2
Agenda
  • Overview of International Traffic in Arms
    Regulations (ITAR)
  • Key terms
  • License requirements
  • Defense Technology Security Administration (DTSA)
  • Mission
  • License Directorate
  • Commodity Jurisdiction Overview
  • Exporting Technology
  • Technology license vs. Deemed Export License
    Review
  • Export Control Reform
  • Four singulars

3
  • Overview of
  • ITAR

3
4
Licensing Authority/DTSA Role
  • U.S. export laws divide the authority for export
    licensing
  • Arms Export Control Act Department of State for
    defense articles
  • Export Administration Act Department of
    Commerce for dual-use items
  • Expeditiously coordinate, develop and adjudicate
    the DoD position on licenses, regulations and
    other actions received from the licensing
    regulatory authority for review.
  • Ensure recommendations fully address DoD
    technology security policies, support and protect
    the warfighter, and prevent the diversion and
    proliferation to programs or entities of national
    security concern.

5
Important ITAR Terms
  • Designation of Defense Articles and Defense
    Services (120.2)
  • The Arms Export Control Act provides that the
    President shall designate the articles and
    services deemed to be defense articles and
    defense services for purposed of the ITAR. The
    items so designated constitute the United States
    Munitions List (USML) and are specified in part
    121 of the ITAR. Such designations are made by
    the Department of State with the concurrence of
    the Department of Defense. For a determination on
    whether a particular item is included on the USML
    see Commodity Jurisdiction. (120.4)

6
Important ITAR Terms
  • General Authorities and Eligibility
  • Section 38 of the Arms Export Control Act (22
    U.S.C. 2778) authorizes the President to control
    the export and import of defense articles and
    defense services.
  • Defense Article (120.6)
  • Any item or technical data designated in 121.1 of
    the ITAR this includes technical data recorded
    or stored in any physical form models, mock-ups
    or other items that reveal technical data
    directly relating to items designated. It does
    not include basic marketing information on
    function or purpose or general system
    descriptions.
  • Defense Services (120.9)
  • The furnishing of assistance (including training)
    to foreign persons, whether in the United States
    or abroad in the design, development,
    engineering, manufacture, production, assembly,
    testing, repair, maintenance, modification,
    operation, demilitarization, destruction,
    processing or use of defense articles.

7
Important ITAR Terms
  • Technical Data (120.10)
  • Information, which is required for the design,
    development, production, manufacture, assembly,
    operation, repair, testing, maintenance or
    modification of defense articles. This includes
    information in the form of blueprints, drawings,
    photographs, plans, instructions and
    documentation
  • Classified information related to defense
    articles/services
  • Information covered by an invention secrecy
    order
  • Software directly related to defense articles
  • Definition does not include information
    concerning general scientific, mathematical or
    engineering principles commonly taught in
    schools, colleges and universities or information
    in the public domain. It does not include basic
    marketing information on function or purpose for
    general system descriptions of defense articles.

8
Important ITAR Terms
  • Public Domain (120.11)
  • Information which is published and which is
    generally accessible or available in the public.
  • Through sales at newsstands and bookstores
  • Through subscriptions which are available without
    restriction to any individual who desires to
    obtain or purchase the published information
  • Through second class mailing privileges granted
    by the USG
  • At libraries open to the public or from the
    public can obtain documents
  • Through patents available at any patent office
  • Through unlimited distribution at a conference,
    meeting, seminar, trade show or exhibition,
    generally accessible to the public in the United
    States
  • Through public release in any form after approval
    by the cognizant USG department or agency
  • Through fundamental research

9
ITAR Exemptions
  • Shipments by or for USG Agencies (126.4)
  • A license is not required for the temporary
    import, or temporary export, of any defense
    article, including technical data or the
    performance of a defense service, by or for any
    agency of the USG for official use by such an
    agency, or for carrying out any foreign
    assistance, cooperative project or sales program
    authorized by law and subject to control by the
    President by other means. (see further details
    within Part 126.4)
  • Canadian Exemptions (126.5) see details in ITAR

9
10
Is a License Required?
  • The license question is much more straight
    forward with a munitions item
  • Step 1 Is your item a defense article or service
    listed in the ITAR?
  • If yes, a license is required to export anywhere
    outside the U.S.
  • In no, are you subject to another export
    jurisdiction?
  • Dont know, submit a commodity jurisdiction
    through the Directorate of Defense Trade Controls
    (DDTC).

11
  • Overview of
  • DTSA

11
12
Other Regulatory Agencies
  • U.S. Department of State - Directorate of Defense
    Trade Controls
  • U.S. Department of Justice - Drug Enforcement
    Administration
  • U.S. Department of Interior - Fish Wildlife
    Service
  • U.S. Department of Energy
  • U.S. Nuclear Regulatory Commission
  • U.S. Department of Treasury - Office of Foreign
    Assets Control
  • U.S. Department of Commerce - Office of Patent
    Trademarks
  • U.S. Department of Agriculture
  • U.S. Department of Health and Human Services -
    Food Drug Administration
  • NOTE DTSA is not a Regulatory Agency, but is the
    only USG agency that reviews and provides
    national security input on both dual-use and
    munitions license applications

13
DTSAs Mission Strategic Goals
  • Mission Statement
  • To promote United States national security
    interests by protecting critical technology while
    building partnership capacity
  • Strategic Goals
  • Preserve the U.S. defense edge by preventing the
    proliferation and diversion of technology that
    could prove detrimental to U.S. national security
  • Engage U.S. allies and partners to increase
    interoperability and protect critical
    technologies
  • Facilitate the health of the U.S. industrial base
  • Align and utilize resources to support DTSA's
    mission
  • Empower people and make DTSA a great place to
    work

14
Defense Technology Security Administration
Director, Defense Technology Security
Administration (DTSA) Mr. James Hursch
Military Assistant, DTSA
Deputy Director, DTSA Mr. Anthony Aldwell
LicensingDirectorate
PolicyDirectorate
TechnologyDirectorate
SpaceDirectorate
Management Directorate
International Security
--Personnel --Security --Logistics --Comptroller -
-Info Technology --Info Assurance
-- License Monitoring -- Tech Exchanges -- Tech
Data Reviews
-- License Reviews -- Commodity Jurisdictions --
Voluntary Directed Disclosures -- Regulations
-- Regional Policy -- Negotiations/Liaison --
Capabilities/Systems -- Assessments/CFIUS
-- Aeronautical -- Electronics -- Information
Communications -- Sensors Lasers -- Missiles
Space -- NBC/Land/Naval/ Materials/Machine Tools
-- Space Monitoring
-- Secretariat NDPC -- FG Disclosure Policy --
Security Surveys -- General Security Agmt -- NATO
Security Policy -- FN Pers Assgn Policy --
Monitor Intl Sec Prgm -- Intl Sec Tng Oversight
15
2010 License Reviewed
Munitions
Dual Use
38,907 Licenses Reviewed
19,049 Licenses Reviewed
1 Jan - 31 Dec 2010
16
DoD Munitions License Review Timeline (Calendar
Days)
Reply to DTSA within 25 days
Case Received from State/DTC (Electronic/Paper)
Created at DTSA
Referred to DoD Reviewers
No
"Prescreen"
OR
Yes
14 Day Extension (if DTSA approved)
Position to State/DTC within 2 days
Potential Escalation by DoD Reviewers w/in 2 days
Draft Decision by DTSA w/in 2 days LDF?LDM
Escalation Process
Escalate
Yes
No
Position to State/DTC
Position to State/DTC
17
DoD Role in CJ / CCATS Process
  • Both the CCL and USML are used as measures for
    appropriate export control
  • Important considerations
  • Legacy of Development
  • Capability
  • Performance equivalents
  • Sales history
  • Precedents

18
Regulatory Basis of DoD Review
  • International Traffic in Arms Regulations (ITAR),
    22 CFR 120.3
  • An article may be designated a defense article
    if it
  • (a) Is specifically designed, developed,
    configured, adapted, or modified for a military
    application and
  • (i) Does not have a predominant civil
    application, and
  • (ii) Does not have a performance equivalent
    (defined by form, fit and function) to articles
    used for civil applications,
  • OR
  • (b) Is specifically designed, developed,
    configured, adapted, or modified for a military
    application, and has significant military or
    intelligence capability such that control under
    the ITAR is necessary.
  • The intended use of the article or service after
    its export is not relevant in determining whether
    an item is a defense article.

19
Hints for CJ Submittals
  • Reviewing Audience for CJ submission some
    technical, some not so technical
  • (1) DoD/DoC Engineers
  • (2) Senior Decision Makers NON-TECHNICAL!
  • Be forthcoming in providing complete descriptions
    of the item and its development
  • Be brief and to the point
  • Identify current civil and military uses any
    other potential uses
  • Compare and Contrast the civil and military
    variants/usage
  • Provide details on any differences between
    variants
  • What is required to use for military mission?
  • Sales and Export History, if any
  • Comparable Items and Foreign Availability
  • Avoid Legal Speak and no marketing hyperbole
    please !
  • Appropriate jurisdictional control is the
    ultimate goal

20
DoD 2010 CJ Positions
917 License Decisions 1 Jan - 31 Dec 2010
21
  • Exporting Critical
  • Technology

21
22
Exporting Critical Technology
  • The balance in protecting technology
  • Give a man a fish and you feed him for a day.
    Teach a man to fish and you feed him for a
    lifetime.
  • Chinese Proverb
  • If we guard our toothbrushes and diamonds with
    equal zeal, we will lose fewer toothbrushes and
    more diamonds,
  • McGeorge Bundy
  • National Security Advisor
  • for President Kennedy and Johnson
  • allow the nation to focus on controlling
    critical technologies and items that maintain
    U.S. military technology advantage.
  • Robert M. Gates
  • Secretary of Defense
  • April 20, 2010
  • on export control reform

23
Exporting Critical Technology - EAR
  • What is a technology export?
  • EAR, Part 772.1
  • Technology is Specific information necessary for
    the development, production, or use of a
    product.
  • Controlled information leaving the U.S. is a
    technology export.
  • What is a deemed export?
  • EAR, Part 734.2(b)(2)(ii)
  • Release in the United States of technology or
    source code subject to the Export Administration
    Regulations to a foreign national. Such release
    is deemed to be an export to the home country
    of the foreign national.

23
24
Exporting Critical Technology - ITAR
  • What is a technology export?
  • Technical Data (120.10)
  • Information, which is required for the design,
    development, production, manufacture, assembly,
    operation, repair, testing, maintenance or
    modification of defense articles. This includes
    information in the form of blueprints, drawings,
    photographs, plans, instructions and
    documentation (See full definition in ITAR Part
    120.10)
  • What is a deemed export?
  • Under ITAR, the export to the foreign national
    considers citizenship and place of birth (if
    different)
  • Federal Register noticed published in April 2011,
    requires U.S. entity to verify compliance and no
    release of ITAR controlled information without
    prior USG approval.

24
25
How to improve your license processing times
  • Communication Early and Often
  • On sensitive technologies going to sensitive
    countries, make sure you make early contact with
    LDD licensing officers.
  • Dont be afraid to call the assigned DoD
    licensing officers
  • Complete Licensing Packages
  • Ensure license application is completely filled
    out and has correct information
  • Ensure all supporting documentation is completed
    and accurate
  • More details outlining specifics of the
    transaction are always welcomed this is critical
    in technology transactions.
  • Complete due diligence on all end-users
  • Review Entity List, Unverified List and
    applicable USG public list
  • Ensure all end-user certificates are completed
    and delivered with the application
  • Set realistic expectations with your customer
  • Educate your customer on the U.S. exports
    licensing process and responsibilities

26
  • U.S. Munitions List
  • (USML) Part 121

26
27
USML Part 121
  • Category I Firearms, Close Assault Weapons and
    Combat Shotguns
  • Category II Guns and Armament
  • Category III Ammunition/Ordnance
  • Category IV Launch Vehicles, Guided Missiles,
    Ballistic Missiles, Rockets, Torpedoes, Bombs and
    Mines
  • Category V Explosives and Energetic Materials,
    Propellants, Incendiary Agents and Their
    Constituents
  • Category VI Vessels of war and Special Navel
    Equipment
  • Category VII Tanks and Military Vehicles
  • Category VIII Aircraft and Associated Equipment
  • Category IX Military Training equipment and
    Training
  • Category X Protective Personnel Equipment and
    Shelters
  • Category XI Military Electronics
  • Category XII Fire Control, Range Finder, Optical
    and Guidance and Control Equipment

27
28
USML Part 121
  • Category XIII Auxiliary Military Equipment
  • Category XIV Toxicological Agents, Including
    Chemical Agents, Biological Agents and Associated
    Equipment
  • Category XV Spacecraft Systems and Associated
    Equipment
  • Category XVI Nuclear Weapons, Design and Testing
    Related Items
  • Category XVII Classified Articles, Technical
    Data and Defense Services Not Otherwise
    Enumerated
  • Category XVIII Directed Energy Weapons
  • Category XIX reserved
  • Category XX Submersible Vessels, Oceanographic
    and Associated Equipment
  • Category XXI Miscellaneous Articles

28
29
USML Examples
  • Unmanned Aerial Vehicles (UAVs)
  • Category VIII Aircraft and Associated Equipment
  • (a) Aircraft, including but not limited to
    helicopters, non-expansive balloons, drones, and
    lighter-than-air aircraft, which are specifically
    designed, modified, or equipped for military
    purposes. This includes but is not limited to
    the following military purposes Gunnery,
    bombing, rocket or missile launching, electronic
    and other surveillance, reconnaissance,
    refueling, aerial mapping, military liaison,
    cargo carrying or dropping, personnel dropping,
    airborne warning and control, and military
    training.

29
30
USML Examples
  • Satellites
  • Spacecraft Systems and Associated Equipment
  • (a) Spacecraft, including communications
    satellites, remote sensing satellites, scientific
    satellites, research satellites, navigation
    satellites, experimental and multi-mission
    satellites.
  • NOTE TO PARAGRAPH (a) Commercial communications
    satellites, scientific satellites, research
    satellites and experimental satellites are
    designated as SME only when the equipment is
    intended for use by the armed forces of any
    foreign country.

30
31
  • Export Control
  • Reform

31
32
Export Control Reform
  • Secretary Gates noted
  • We need a system that dispenses with the 95
    percent of easy cases and lets us concentrate
    our resources on the remaining 5 percent.
  • By doing so, we will be better able to monitor
    and enforce controls on technology transfers with
    real security implications while helping to speed
    the provision of equipment to allies and partners
    who fight alongside us in coalition operations.
  • If addressed properly, national security and
    efficiency are not mutually exclusive.
  • Reform is driven by national security.

33
Structure of the New Export Control System
  • On August 31, 2010, the President announced that
    the Administration is moving forward on a
    fundamentally new U.S. export control system.
  •  
  • The system will be based on the four singles that
    Secretary Gates mentioned in his April speech
  • Single export control licensing authority
  • Single control list
  • Single primary enforcement coordination agency
  • Single IT system to process all licenses

34
Way Ahead
  • Single Licensing Agency
  • Creation of the Single Licensing Agency (SLA)
    will likely require legislation
  • The Task Force has draft legislation which they
    expect to discuss with new congressional leaders
    in January 2011
  • Single IT System
  • Memorandum of Agreement (MOA) signed with State
    in February 2010 initial operational capability
    expected by June 2011
  • MOA signed with Commerce in October 2010
    initial operational capability projected for June
    2012
  • Enforcement Coordination Center
  • Work on-going to implement EO

35
Licensing Directorate
Michael Laychak Director Licensing
Directorate 703-325-4116 Michael.Laychak_at_dtsa.mil
Kenneth Oukrop Munitions Division Chief Licensing
Directorate 703-325-3990 Kenneth.Oukrop_at_dtsa.mil
Todd Willis Dual-Use Division Chief Licensing
Directorate 703-325-3672 Todd.Willis_at_dtsa.mil
DDTC Website http//www.pmddtc.state.gov/index.ht
ml DTSA Website http//www.dtsa.mil/
36
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