Operation
All U.S. manufacturers, exporters, and brokers of defense articles, defense services, or related technical data, as defined on the USML, are required to register with U.S. Department of State. Registration is primarily a means to provide the U.S. Government with necessary information on who is involved in certain manufacturing and exporting activities. Registration does not confer any export rights or privileges, but is a precondition for the issuance of any license or other approval for export. Registration fees start at US$2,250 per year.
Under ITAR, a “US person” who wants to export USML items to a “foreign person” must obtain authorization from the U.S. Department of State before the export can take place.
A "U.S. person" can be
- a U.S. citizen;
- a permanent resident who does not work for a foreign company, a foreign government, or a foreign governmental agency/organization;
- a political asylee;
- a part of the U.S. government, or
- a corporation, business, organization, or group that is incorporated in the United States under U.S. law.
A foreign person is any person who is not a lawful permanent resident of the U.S. and includes foreign governments and organizations. This means that, for example a foreign person who is visiting the U.S. will remain a foreign person for the purposes of ITAR and any export of USML items to them inside the U.S. must be subject to an export authorization. This is similar to the concept of “Deemed Exports” used by the Bureau of Industry and Security within the Department of Commerce in administration of the Export Administration Regulations although the Department of State does not use the term “Deemed Export” (see also “Restrictions on Dual and Third Country Nationals below”).
The export authorization may take the form of:
- a Foreign Military Sales (“FMS”) Case whereby the U.S. Government sells the USML items directly to a foreign government;
- an export license, such as a DSP-5 (Department of State Publication No. 5), which authorizes the temporary or permanent export of defense articles and/or technical data to a foreign person (but not technical assistance or defense services);
- a Warehouse and Distribution Agreement which is an agreement to establish a warehouse or distribution point abroad for defense articles to be exported from the United States for subsequent distribution to entities in an approved sales territory;
- a Technical Assistance Agreement (“TAA”) which authorizes a U.S. manufacturer/service provider to supply defense services to a foreign person (which could involve training or technical discussions regarding U.S. technology); or
- a Manufacturing License Agreement (“MLA”) which authorises a U.S. manufacturer to supply manufacturing know-how related to defense articles to a foreign person.
Where the export authorization relates to USML items that are classified information or are identified as “Significant Military Equipment” on the USML, a DSP-83 Nontransfer and Use Certificate will also be required.
Collaborative programs (also known as “Armaments Cooperative Projects” (“ACPs”)) between the U.S. and foreign Governments (such as the Joint Strike Fighter) may also authorize export of USML items (subject to strict controls).
Read more about this topic: International Traffic In Arms Regulations
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