04 June Technology Transfer & Export Controls

04 June Agenda  Technology Transfer & Export Controls Authority and Policy  Process and Decision to Disclose and Transfer  Compliance with and execution of Disclosure Policy  Licensing Authorities  Exports Approval / License Process

04 June

04 June Protecting US Technology Michelle Van Cleave Former National Counterintelligence Executive “Virtually every technology that is on the U.S. control technology list has been targeted: sensors and optics, and biological and chemical processes… having inherent military application.” “I think we’re a real candy store for the Chinese and for others in terms of technology and commercial products and other proprietary information and so we will always be the principal target for them.” Interview with 60 Minutes (CBS) 28 February 2010

04 June Reasons for Technology Transfer/Export Control  National Security  Foreign Policy  Weapons of Mass Destruction  Terrorism

04 June International Program Criteria  Lawful and authorized  Government or commercial effort with contributing or receiving foreign participant  Information or technology is transferred from one country to another

04 June DoD Policy on Technology  Valuable national security resources*  Protected and invested in pursuit of national security and foreign policy objectives  International trade is key to strong U.S. industrial base  Export controls in way to minimally interfere with legitimate trade *DoDI DoDI International Transfers of Technology, Articles, and Services

04 June Balancing Demands U.S. strategic objectives WRT to the partner? Partner’s capability requirements? Capabilities requested by the partner? Urgency? Higher-priority need for the capabilities? Partner’s capacity to absorb, effectively employ capabilities? Strategic benefits to U.S.? Sensitivity of the technology? Partner’s ability to capitalize on the technology? Partner’s capability and willingness to protect sensitive U.S. technology? Risks to the U.S. or its allies/partners if the technology is compromised? Seriousness of these risks? Possibility of satisfactory risk mitigation? Provide required capabilities quickly to allies and partners Protect the “crown jewels” of U.S. Defense technology How can the USG/DOD best balance these two demands? What is DoD’s “decision trade space”? ?? ?

04 June Access + Protection = Export and Disclosure Authorization Decisions Fundamental Considerations 1. Access Sharing of U.S. defense articles or information is in the best interests of the U.S. 2. Protection Maintain security and provide security substantially the same as that provided by the U.S.

04 June Legal and Policy Basis for Security in International Programs Arms Export Control Act (AECA) Executive Order National Security Decision Memorandum (NSDM) 119 Three Documents

04 June Arms Export Control Act (AECA)  Forms the legal basis for the security requirements of most DoD International Programs  Governs export and import of defense articles and services  Covers commercial and government programs  Section 38 is implemented by the ITAR which contains US Munitions List (USML)  (Statutory authority of President delegated to State Dept)

04 June Directorate of Defense Trade Controls

04 June Executive Order  Establishes the National Security Information Program  Uniform system for…  Classifying  Safeguarding  Declassifying  Protection of Foreign Information  DoD Manual (Info Security Program – 3 Volumes) DoD Manual

04 June National Security Decision Memorandum (NSDM) 119  Establishes the NDP Committee (NDPC)  Assigns implementation of NDP to Secretaries of State and Defense  Governs decisions on foreign disclosure of Classified Military Information (CMI)  Requires annual report to National Security Council (NSC)

04 June Security Conditions 1. Will NOT transfer title or possession without U.S. consent 2. Will NOT use or permit use for other purposes without U.S. consent 3. Will maintain security and provide substantially the same degree of protection

04 June Government-to-Government Principle Governs TWO activities related to International Programs: 1. Disclosure/Export authorizations decisions = government-to-government decision 2. Transfers of classified information and material = government-to-government transfer

04 June Technology Transfer Decision Basis  2 Fundamental security Considerations  3 Documents forming the legal and policy basis  3 Conditions that must be agreed upon by foreign recipients  2 Activities associated with International Programs

04 June Agenda  Technology Transfer & Export Controls Authority and Policy  Process and Decision to Disclose and Transfer  Compliance with and execution of Disclosure Policy  Licensing Authorities  Exports Approval / License Process

04 June Technology Security & Foreign Disclosure – ‘Pipes Chart’ perspective DoD Lead: Various Various documented process MILDEP- specific various DoD Lead: Various Various documented process MILDEP- specific various

04 June National Disclosure Policy Committee (NDPC) (DoD Processes discussed on GB pages 7-14 to 7-15) Department of Energy Director, National Intelligence Department of Energy Director, National Intelligence Other Departments and Agencies Other Departments and Agencies National Security Council PRESIDENT

04 June NDPC Disclosure Criteria NDPC Disclosure Criteria  Supports U.S. foreign policy  Benefit to the USG (POL/MIL/National Security)  Not jeopardize U.S. Military security (damage assessment)  Recipient’s capability and intent to protect  Release limited to that necessary to satisfy U.S. goals  Implemented by DoDD DoDD  (DISCLOSURE OF CLASSIFIED MILITARY INFORMATION TO FOREIGN GOVERNMENTS AND INTERNATIONAL ORGANIZATIONS)

04 June Security Survey  Purpose - Enables the NDPC to determine by physical on-site review, whether a particular foreign government has the capability to protect substantially the same as the United States  Evaluates foreign government and industry  Personnel security  Information control  Physical security  U.S. Embassy views also obtained  May result in negotiated security agreement

04 June General Security Agreements  Negotiated via diplomatic channels  Affords classified material substantially the same degree of security protection as the releasing government would provide to its own classified information.  Provides for use limitations  Restricts third party transfers and protects proprietary rights  Provides for reporting losses or compromises  Commits to protect any classified information released to a third party

04 June Agenda  Technology Transfer & Export Controls Authority and Policy  Process and Decision to Disclose and Transfer  Compliance with and execution of Disclosure Policy  Licensing Authorities  Exports Approval / License Process

04 June Disclosure Authority  Is an official, specifically designated in writing, who may disclose or deny CMI per NDP, provided:  The information is originated by the official’s department or agency  The official is responsible for the information to be disclosed  Only those officials with such specific authority may make foreign disclosure determinations  DODD is the main reference

04 June Principal Disclosure Authorities  Office of the Secretary of Defense  Under Secretary of Defense for Policy (USD(P))  Under Secretary of Defense for Acquisition, Technology & Logistics (USD (AT&L))  Under Secretary of Defense for Intelligence (USD(I))  Chief of Staff, Defense Intelligence Agency  Director, Missile Defense Agency  Secretary of the Joint Staff  Military Services  Army Deputy Chief of Staff for Intelligence  Assistant Secretary of the Navy (Research, Development & Acquisition)  Deputy Under Secretary of the Air Force (International Affairs)

04 June N N AVOID Dealing with Foreign Persons DoDD F F A A L L S S EE I M M P P R R E E S S S S I I O O S S

04 June Agenda  Technology Transfer & Export Controls Authority and Policy  Process and Decision to Disclose and Transfer  Compliance with and execution of Disclosure Policy  Licensing Authorities  Exports Approval / License Process

04 June Licensing Authorities and DoD’s Role State (Munitions) Arms Export Control Act (AECA) ITAR / USML Commerce (Civil / Dual-Use) Export Administration Act (EAA) EAR / CCL Defense Not a licensing or approval authority Provides recommendations (via DTSA) to DOS & DOC

04 June Assistant Secretary, Bureau of Political-Military Affairs State Department Bureau of Political-Military Affairs (PM) (Greenbook page 3-6) Regional Security and Arms Transfers (RSAT) Director, Defense Trade Controls DDTC

04 June Directorate of Defense Trade Controls

04 June Licensing Authorities and DoD’s Role State (Munitions) Arms Export Control Act (AECA) ITAR / USML Commerce (Civil / Dual-Use & some Munitions) Export Administration Act (EAA) EAR / CCL Defense Not a licensing or approval authority Provides recommendations (via DTSA) to DOS & DOC

04 June Department of Defense MILDEPs Under SECDEF (Policy) Under SECDEF (Policy) Defense Security Cooperation Agency Joint Staff Secretary of Defense –––––––––––––––––––––––– Deputy Secretary of Defense Secretary of Defense –––––––––––––––––––––––– Deputy Secretary of Defense Dir, International Cooperation Under SECDEF (Acquisition, Technology, & Logistics) Under SECDEF (Acquisition, Technology, & Logistics) Under SECDEF (Intelligence) Under SECDEF (Intelligence) Defense Security Service (DSS) DTSA Chair, NDPC DTSA Chair, NDPC

04 June Defense Technology Security Administration (DTSA)  DoD entry point for export requests:  State Department (DDTC)  Commerce Department (BIS)  State and Commerce send over about 30,000 proposed license to DTSA for review and comment a year  Approximately 80% of the time DTSA develops DoD response  About 20% of the time, ask Services for input

04 June Agenda  Technology Transfer & Export Controls Authority and Policy  Process and Decision to Disclose and Transfer  Compliance with and execution of Disclosure Policy  Licensing Authorities  Exports Approval / License Process

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04 June What Is an Export?  Sending/taking defense articles and/or data out of U.S. in any way  Transferring (in U.S. or abroad) registration, control, or ownership to a foreign person of any material or data covered by U.S. Munitions List  Disclosing (including orally and visually) or transferring any defense article or technical data:  To embassy, agency or subdivision of a foreign government in U.S.  To a foreign person in U.S. or abroad ( ITAR, 22 CFR § )

04 June What is Technical Data*?  Information relating to defense articles or defense services and required for  Includes blueprints, drawings, photographs, plans, instructions, and documentation  Software as defined in U.S. Munitions List  Does not include basic marketing info on function, purpose or general descriptions of defense articles * ITAR, 22 CFR §  design  development  production  manufacture  assembly  operation  repair  testing  maintenance  modification

04 June Export Forms and Licenses (ITAR Part 123 and 126)  DSP-5 Permanent export unclassified technical data or equipment  DSP-61 Temporary import of unclassified defense articles (in-transit)  DSP-73 Temporary export of unclassified defense articles  DSP-85 Permanent/Temporary Export/Import of classified articles/technical data  DSP-83 Non-transfer and Use Certificate  DS-2032Registration Form  DSP-94 FMS shipments (FMS)

04 June Agreements Parts , ,  Technical Assistance Agreement (TAA): An agreement between a U.S. person & a foreign person for defense services or recurring disclosure of tech data as opposed to agreement granting a right or license to manufacture.  Manufacturing License Agreement (MLA): An agreement or contract whereby a U.S. person grants a foreign person an authorization to manufacture defense articles abroad.  Distribution License Agreement (DLA): An agreement to establish a warehouse or distribution point abroad for defense articles exported from the U.S. for subsequent distribution to entities in an approved sales territory

04 June Foreign Military Sales (FMS) License Exemption (Part 126.6)  Technical data sold, leased or loaned under DoD FMS program:  Under a Letter of Offer and Acceptance (LOA)  And accompanied by a valid DSP-94 form  And Exported from the US  On a military aircraft or naval vessel of that government  Or by a freight forwarder or agent of that gov’t  Or via the Defense Transportation Service (DTS)

04 June References and support for Tech Transfer and Export Controls Questions  International Traffic in Arms Regulation (ITAR) International Traffic in Arms Regulation (ITAR)  SAMM Chapter 3 (Technology Transfer and Disclosure) SAMM Chapter 3 (Technology Transfer and Disclosure)  DISAM ‘Greenbook’ Chapter 7 (Technology Transfer, Export Controls, and International Programs Security) DISAM ‘Greenbook’ Chapter 7 (Technology Transfer, Export Controls, and International Programs Security)

04 June Technology Transfer & Export Controls Questions??

04 June