The United States is committed to strengthening allies and partners worldwide to meet their sovereign self-defense needs and to improve their capabilities to operate with U.S. forces to address shared security challenges. The U.S. Department of State’s Bureau of Political-Military Affairs oversees most government-to-government arms transfers and commercial export licensing of U.S.-origin defense equipment and technologies, consistent with the Arms Export Control Act, the Conventional Arms Transfer Policy, the Foreign Assistance Act of 1961, the International Traffic in Arms Regulations, and other statutory authorities and relevant international agreements.
- Arms sales and defense trade are tangible implements of foreign policy with potential long-term implications for regional security. For this reason, the United States takes into account political, military, economic, arms control, and human rights conditions in determining the provision of military equipment and the licensing of direct commercial sales to any country. Each proposed transfer we review is carefully assessed on a case-by-case basis, and approved if found to further U.S. foreign policy and national security interests. In addition, major defense transfers and sales may be subject to Congressional notification.
- Review and End Use Monitoring are integral components of the process for U.S.-origin defense equipment delivered to any recipient nation. The United States works to ensure U.S.-origin defense equipment is used consistent with the agreement or licenses under which the arms were transferred. The United States is committed to expediting, when possible, defense transfers to U.S. allies and partners, while at the same time seeking to control access to U.S.-origin defense technologies by hostile state and non-state actors. Before U.S.-origin defense articles and services are exported or transferred to foreign entities, those entities must agree to: 1) not retransfer equipment to third parties without first receiving written U.S. government authorization; 2) not dispose of or use the defense article for purposes other than those for which they were furnished without first receiving written U.S. government authorization; and; 3) maintain the security of any item with substantially the same degree of protection afforded by the U.S. government.
- Properly regulated defense transfers support the U.S. defense industrial base, promote interoperability, and reduce the costs of procurement for our own military. Up to 1 million people across our nation rely on U.S. defense exports for their jobs. These individuals and the companies they work for represent a key part of American entrepreneurship and innovation, as they help to maintain the United States as the world leader in the defense and aerospace sectors and ensure our armed forces sustain their military edge.
FOREIGN MILITARY SALES (FMS)
- Under FMS, the United States government manages approximately $55 billion per year in new sales of defense equipment to foreign allies and partners. The Office of Regional Security and Arms Transfers in the Department of State’s Bureau of Political-Military Affairs (PM/RSAT) manages the FMS approval process, in close partnership with the Department of Defense’s Defense Security Cooperation Agency (DSCA). DSCA coordinates implementation of FMS cases the military services negotiate with U.S. defense contractors. These sales provide the foreign allies and partners who are our customers with a complete defense capability that includes training, sustainment, and contractor logistics support.
- The FMS sales process begins when a country submits a formal Letter of Request (LOR). Ideally, this includes both a desired military capability, and a rough estimate of what the partner is able to spend. Sales are approved following U.S. government review and, when required, after Congressional notification. After the sale is approved, the DSCA issues a Letter of Offer and Acceptance (LOA) specifying the defense articles, training, and support being offered for delivery. Major FMS sales formally notified to Congress are publicly announced on the DSCA website.
- Processing times for FMS cases vary, but they may take months to define and approve, especially for major defense articles that may require modifications to standard U.S. configurations. Partners often do not take delivery of the full package until years after the LOA is finalized, which is primarily due to the time required to construct sophisticated defense systems such as fighter aircraft.
DIRECT COMMERCIAL SALES (DCS)
- Under DCS, the Bureau of Political-Military Affairs’ Directorate of Defense Trade Controls (PM/DDTC) provides regulatory approvals for approximately $115 billion per year in sales of defense equipment, services, and related manufacturing technologies controlled under the 21 categories of the U.S. Munitions List (USML). These sales are negotiated privately between foreign end-users and U.S. companies.
- Under the International Traffic in Arms Regulations (ITAR), any U.S. company or individual involved in certain activities involving defense articles described on the USML is required to register with DDTC. Further, a DDTC license or other approval is required before exporting a defense article (including ITAR-controlled technical data), or providing a defense service to a foreign end-user.
- As with FMS, export licenses approved under DCS are approved following an intensive U.S. government review, and after congressional notification, as required. Export licenses are valid up to four years. Authorizations for defense services may be for longer timeframes. They may be extended or amended as needed.
- DCS cases are considered to be proprietary agreements between the foreign governments or companies and U.S. defense contractors; however certain information about cases notified to Congress is published quarterly in the Federal Register, in fulfillment of requirements in the Arms Export Control Act.
- Aggregate data regarding approved export authorizations to governments is published annually to DDTC’s website, known as the “655 Report.”
- Dual-use items and some less sensitive military technologies are controlled by the Department of Commerce on the Commerce Control List (CCL). Since 2013, the U.S. Government has transferred a significant number of items and technologies from the USML to the CCL to ease the burden on U.S industry as part of our ongoing regulatory reform efforts.
For further information, please contact the Bureau of Political-Military Affairs, Office of Congressional and Public Affairs at PM-CPA@state.gov, and follow the Bureau of Political-Military Affairs on Twitter, @StateDeptPM.