1. BUREAU OF POLITICAL-MILITARY AFFAIRS Office of Regional Security and Arms Transfers PM/RSAT The Third-Party Transfer Process www.state.gov/t/pm/rsat LuongLL@state.gov LuongLL@state.sgov.gov 202-647-9362 Office 202-647-9779 fax

2. Overview Basic Legal Concepts Arms Transfer Decision Process/Policies What You Need to Know About Third-Party Transfers

3. Sue Plant PlantSA@state.gov Non-NATO EUR and SCA National Disclosure Policy Alcohol, Tobacco, & Firearms Sue Plant PlantSA@state.gov Non-NATO EUR and SCA National Disclosure Policy Alcohol, Tobacco, & Firearms Third-Party Transfer Officers LaTania Barnes BarnesLM@state.gov Global Disposals and Displays LaTania Barnes BarnesLM@state.gov Global Disposals and Displays Leann Luong LoungLL@state.gov NATO TPT Outreach Leann Luong LoungLL@state.gov NATO TPT Outreach CDR Tung Ho HoT2@state.gov EAP National Disclosure Policy CDR Tung Ho HoT2@state.gov EAP National Disclosure Policy Berneta Lee LeeBJ@state.gov Section Chief NEA and AF TPT Statistics Database Development Berneta Lee LeeBJ@state.gov Section Chief NEA and AF TPT Statistics Database Development Ed Richardson RichardsonEP@state.gov WHA National Disclosure Policy Ed Richardson RichardsonEP@state.gov WHA National Disclosure Policy U.S. Department of State 3

4. 4 The transfer, sale, disposal or change in end-use of any U.S.-Origin Defense Article, including all associated components, services, and training, acquired through any USG Security Assistance Program.

5. A Transfer Is a Transfer Is a Transfer AECA Section 3(a)(2): “No defense article or defense service shall be sold or leased by the United States Government…unless- the country agrees not to transfer title to, or possession of, any defense article or related training or other defense service so furnished to it to anyone not an officer, employee, or agent of that country...and not to use or permit the use of such article or related training or defense service for purposes other than those for which furnished unless the consent of the President has first been obtained.” Legal Basis

6. U.S. Department of State6 All U.S.- Origin Defense Articles, Services, Training, or Data Require USG Authorization Before Transfer or Sale

7. U.S. Department of State7 Authorization The President The Secretary of State The Under Secretary for Arms Control And International Security (T)

8. U.S. Department of State Third Party Transfer Completions CY 2011 Type of Transfers

9. U.S. Department of State9 Requirements for Consideration  An Official Request from the Divesting Government  A Completed Standard Questionnaire  End-Use, Retransfer, and Security Assurances from the Recipient

10. 5 Helpful Hints Complete & fully detailed questionnaire Be sure include ALL private companies that will have access to USML Advise recipients that EUAs are required for all parties involved before TPT is processed – applicant should provide As much as advance notice as possible Correspondence: Request/Use RSAT case numbers. Ask at the time of request

11. Process to Completion Foreign Government ODC, OMC, JUSMAG, etc. 3 rd Party Transfer Officer Appropriate Clearers 3 rd Party Transfer Officer PM/RSAT Deputy Director PM/RSAT Director PM Deputy Assistant Secretary PM Staff Assistants PM Assistant Secretary PM Staff Assistants 3 rd Party Transfer Officer ODC, OMC, JUSMAG, etc. Congress Under Secretary U.S. Department of State 11 Foreign Government

12. Key Players U.S. Department of State12 ODC, OMC, JUSMAG, etc. PM/RSAT Arms Transfer Team PM/RSAT Arms Transfer Team U.S. Military Departments _________ All Requests U.S. Military Departments _________ All Requests Embassies National Security Agency _________ Crypto and COMSEC Equipment National Security Agency _________ Crypto and COMSEC Equipment GPS Policy __________ SAASM And GEM IV GPS Policy __________ SAASM And GEM IV PM/DDTC Licensing Team _________ Private Entities PM/DDTC Licensing Team _________ Private Entities International MIDS Committee __________ MIDS Systems and Components International MIDS Committee __________ MIDS Systems and Components

13. Timelines How long should I expect a TPT to take? –Varies by case Government-to-government TPTs: 1-3 months Cases that require Congressional Notification can take an additional 3-12 months

14. U.S. Department of State14 NATO Members, Australia, Japan, and N. Zealand, S. Korea, Israel 15-Day Formal Notification Period MDE $25 Million Threshold All Other Articles $100 Million Threshold Congressional Notification All Other Countries 30-Day Formal Notification Period MDE $14 Million Threshold All Other Articles $50 Million Threshold

15. U.S. Department of State15 Transfers to Private Entities Governed by Department policy Presumption of denial Limited exceptions for entities with proof of government contract or static display

16. U.S. Department of State16 END-USE ASSURANCES Assurances from all recipients, including any intermediaries, must be included with the request Assurances are required from the Government exercising legal jurisdiction over a foreign Private Entity Recipient Blanket Assurance Program

17. U.S. Department of State17 Blanket Assurance Signatories Afghanistan Albania Belgium Bolivia Canada Chile Denmark Georgia Hungary NATO New Zealand Norway Oman Portugal Turkey Tunisia U.A.E. Yemen Iraq Israel Italy Jordan Lebanon Latvia Lithuania Malaysia Morocco

18. Red Flags What constitutes an automatic “No ”? SME to private entities with no specific government end user contract Aircraft parts to private entities with no specific Government end-user contract (i.e. warehousing or stock) USML to private individuals (i.e. private collection) Marketing contracts with private companies

19. U.S. Department of State19 The transfer, sale, disposal or change in end-use of any U.S.-origin component without USG authorization is a

20. U.S. Department of State20 Congressional Requirement U.S. law requires the Department of State to report possible Third-Party Transfer violations to Congress

21. Blanket Authority Agreement  Blanket Authorization to Private Entity Recipients  Temporary transfers for maintenance, repair, or overhaul on specific platform only  Unclassified articles and data only  One-time request  Specific duration  Blanket Authorization to Private Entity Recipients  Temporary transfers for maintenance, repair, or overhaul on specific platform only  Unclassified articles and data only  One-time request  Specific duration U.S. Department of State21

22. Initiatives Encourage the use of blanket transfer agreements for sharing/pooling of unclassified parts and disposal. Electronic transmission of third party transfer requests (SCIP). Increase participation in Blanket End Use Assurance Program. Closer working relationship with DoD, FMS nations and industry. For “hybrid” cases (defense articles/services supplied via FMS and DCS) – Coordinate with DDTC and RSAT. U.S. Department of State 22

23. U.S. Department of State23 QUESTIONS?