International Acquisition & Exportability Fundamentals.

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Presentation transcript:

International Acquisition & Exportability Fundamentals

2 TSFD FMSDCSICP Are These Acronyms Familiar? DEF

3 Overview Defense Exportability Sales & Transfers Technology Security & Foreign Disclosure International Cooperative Programs International Acquisition & Exportability (IA&E) Environment Int’l Acquisition Forms and Mechanisms Technology Security & Foreign Disclosure Defense Exportability Changing the Culture Topics

4 The Environment Environment demands we change the way we train international acquisition professionals

5 International Acquisition & Exportability (IA&E) Defense Exportability Integration Sales & Transfers Technology Security & Foreign Disclosure International Cooperative Programs

6 ICPs Vs. Defense Sales ICPs (Partnerships) More Flexible Bilateral or Multilateral Foreign Gov’t is Partner Joint Requirement Both Gov’ts Are End Users Both Gov’ts Fund Terms are Negotiable Both Participate in Oversight Cost of Services are Shared USD(AT&L) Oversees (Title 10) DEFENSE SALES (Buyers-Sellers) More Structured Bilateral Arrangement Foreign Gov’t is Customer Foreign Gov’t Requirement Foreign Gov’t End User Foreign Gov’t Funds U.S. Sets Terms (LOA) U.S. Controls Implementation Foreign Gov’t Pays for Services USD(P) Oversees (Title 22)

7 International Acquisition & Exportability (IA&E) Defense Exportability Integration Sales & Transfers Technology Security & Foreign Disclosure International Cooperative Programs

UNCLASSIFIED FMS and Service Procurement: 5 Year Average, FY10-14 The Scale of FMS #1. $45.1 Billion Navy (incl. USMC) #2. $39.0 Billion FMS #3 $38.8 Billion Air Force #4 $32.4 Billion Army Benefits to the U.S. Builds U.S.-partner relationships Interoperability Lowers unit costs for the U.S. DoD Maintain production lines Dollars into the U.S. economy Jobs 8

9 FMS vs DCS vs Hybrid DoD is generally neutral whether a foreign country purchases through FMS or DCS Certain items can be designated FMS only; based on complexity, sensitivity, interoperability, relationships Most major system DCS programs will have an FMS companion effort for FMS-only items (i.e. a hybrid program) Many EW system international sales are “hybrid programs” due to classified aspects of system software functionality

10 Program Trends Past Present Foreign Military Sales (FMS) Direct Commercial Sales International Cooperative Programs (ICPs) Sale of DoD Configuration with Exportability Modifications Integration of Buyer Furnished Equipment (BFE) Development and Integration of New Equipment Sale of DoD Configuration with Exportability Modifications DCS/FMS Hybrid Programs Sale of New or Highly Modified Systems Cooperative Development of New Systems Incorporating Foreign Participation in DoD Program Cooperation Throughout Programs’ Life-Cycles

11 International Acquisition & Exportability (IA&E) Defense Exportability Integration Sales & Transfers Technology Security & Foreign Disclosure International Cooperative Programs

12 The Dilemma How can the USG/DOD best balance these two competing demands? Provide required capabilities quickly to allies and friends Protect the “crown jewels” of U.S. defense technology

13 TSFD and Export Control Basics Fundamental Security Considerations Release Conditions Type of Authorizations TSFD Disclosure Authorizations Export Control Not transfer or use for other purposes without U.S. consent Provide substantially the same degree of protection as U.S. AccessProtection + DoD Intel Community Interagency State & Commerce DoD Interagency DoD Interagency

14 USG/DoD TSFD Processes MILDEP Processes DoD Lead: Various MILDEP-specific various MILDEP Process Other DoD Processes DoD Lead: Various Org.-specific various Few documented processes Interagency process LO/CLO AT&L Primary AT AT&L Primary SAP SAPCO Specialized DSC AT&L + Policy Specialized Intel USD(I) Specialized Data Links/WF DoD CIO Specialized PNT/GPS DoD CIO Specialized COMSEC NSA & DoD CIO Primary GEOINT NGA Specialized MTCR Policy Specialized NDP Policy Primary EW None No single process NVD/INS DTSA Specialized

15 International Acquisition & Exportability (IA&E) Defense Exportability Integration Sales & Transfers Technology Security & Foreign Disclosure International Cooperative Programs

16 Designing for Exportability Launch customer paid for technology security modifications to DoD configuration Expensive and time consuming mods inhibit foreign sales No authority to use appropriated funds for exportability design Past Defense Exportability Features (DEF) Pilot Program authorized by Congress in FY11 and subsequent Nat’l Defense Authorization Acts OSD and the MILDEPs have selected 15 programs to participate as DEF Pilot Programs Authorizes expenditure of DoD funds to evaluate exportability and facilitate planning; industry shares cost Facilitates incorporation of program protection features in systems with high export potential during system development Present Improves protection of Critical Program Information (CPI) and critical functions using Anti-Tamper (AT)/Cyber measures Reduces overall DoD and foreign program protection costs Makes our equipment available earlier to Allies and Friends Why

17 Int’l Acquisition Transactions Looking Forward -- Macro View US Strategy & Policy Foreign Strategy & Policy Capabilities & Tech Willing to Transfer Desired Capabilities & Tech Inquiry, Partnership Discussion or Request for Purchase Inquiry, Partnership Discussion or Request for Purchase ? ? FMS DCS ICP Other TSFD Export Control Int’l Acquisition Transactions Int’l Acquisition Transactions Defense Initial TSFD & DEF Initial TSFD & DEF Add Engage Earlier Acquisition System

18 Changing the International Acquisition Culture Conventional Separate ICP, FMS, DCS business planning Sequential, stove-piped transaction mechanisms Reactive TSFD and export control policy development Exportability mods to U.S. design by launch partners/customers IA&E Integrated international business planning Multiple, parallel transaction mechanisms Early TSFD and export control policy engagement Design for exportability throughout the acquisition life cycle Improved Outcomes for DoD, Allies, and Friends!

19 Back Up Charts

20 Security Cooperation Elements Combined Exercises Equipment Sales & Financing Defense Contacts & Familiarization Int’l Armaments Cooperation Support to Operations Humanitarian Efforts & Civic Assistance Int’l Training & Education Elements that involve defense acquisition in color DoDD October 2008

21 International Cooperative Programs (ICPs) Scope DoD concludes about ~30 international agreements/year for ICPs Most agreements are for S&T or early R&D projects Some agreements for cooperation on a “piece” of a program Limited number of fully cooperative major system development/production programs Major System Examples F-35 Joint Strike Fighter (JSF) NATO Alliance Ground Surveillance (AGS) Rolling Airframe Missile (RAM) Evolved SeaSparrow Missile (ESSM) Multifunctional Information Distribution System (MIDS) Guided Multiple Launch Rocket System (GMLRS) Wideband Global SATCOM (WGS)

22 Security Assistance Programs Program Administration Responsibilities Department of Defense Foreign Military Sales (FMS) Foreign Military Financing Program (FMFP) Int’l Military Education & Training (IMET) Foreign Military Construction Services (FMCS) Leases Drawdowns Excess Defense Articles (EDA) Department of State Peacekeeping Operations Int’l Narcotics Control & Law Enforcement Nonproliferation, Antiterrorism, Demining, and Related (NADR) Direct Commercial Sales (DCS) US Agency for Int’l Development Economic Support Fund (ESF) Security Assistance is a State Department-led effort primarily implemented by DoD

23 Building Partner Capacity (BPC) Title 10, DoD Security Cooperation programs executed through the FMS infrastructure Differences from traditional FMS – USG Requesting Authority identifies requirement – Funded by the USG – “Pseudo”-LOAs are not signed by country – Title transfers in country Variety of programs conducted under multiple legal authorities List of BPC policies & programs are contained in Chapter 15 of DoD’s Security Assistance Management Manual (SAMM)

24 USG/DoD TSFD Processes MILDEP Processes DoD Lead: Various MILDEP-specific various MILDEP Process Other DoD Processes DoD Lead: Various Org.-specific various Few documented processes Interagency process LO/CLO AT&L Primary AT AT&L Primary SAP SAPCO Specialized DSC AT&L + Policy Specialized Intel USD(I) Specialized Data Links/WF DoD CIO Specialized PNT/GPS DoD CIO Specialized COMSEC NSA & DoD CIO Primary GEOINT NGA Specialized MTCR Policy Specialized NDP Policy Primary EW None No single process NVD/INS DTSA Specialized

25 DoDD , “ATTR SSG and TSFDO” (New October 2014) OSD TSFD Initiative Arms Transfer and Technology Release (ATTR) Senior Steering Group (SSG) created in 2008 and formally established in 2012: – Overarching DoD authority to ensure clear senior-level direction; USD(P) & USD(AT&L) co-chairs – Serves as appeals board and mediation body TSFD Office (TSFDO) supports ATTR SSG efforts: – ATTR SSG Executive Secretariat and assesses/recommends changes to policies – Develops/implements procedures and checklists, coordinates documentation and policy, conducts outreach