The Senate Foreign Relations Committee (SFRC), chaired by Sen.
Joe Biden (D-DE), announced last week that it was delaying
consideration of bilateral defense trade cooperation treaties
between the United States and the United Kingdom and between the
U.S. and Australia.
These treaties are important to advancing U.S. defense and
security cooperation with two of its closest allies. They also
offer important benefits to U.S. industry and the American
military. The SFRC and the Bush Administration must work together
to resolve the concerns that led to this delay, and the SFRC must
give early consideration to both treaties.
A Cumbersome Process
The U.S.-U.K. treaty (Treaty Document 110-7) was signed on June
21 and 26, 2007. A similar U.S-Australian treaty (Treaty Document
110-10) followed on September 5, 2007. The treaties permit the U.S.
to trade most defense articles with these nations without an export
license or other written authorization. Currently, the U.S. reviews
export license requests on a case-by-case basis. In 2006, the U.S.
Department of State reviewed more than 7,000 licenses for defense
exports to the U.K. Potential transatlantic projects often require
many levels of government approval.
Despite some recent improvements, the export license process
remains a cumbersome and lengthy one. This discourages defense
suppliers from the U.K. and Australia from participating in U.S.
defense acquisition programs, which raises costs and reduces the
ability of the U.S. to supply its forces efficiently. At the same
time, the license system raises barriers to profitable U.S. exports
to its closest allies.
Finally, it encourages the U.K. and Australia to procure from
other suppliers, whose systems may not be interoperable with those
of the U.S. This reduces the ability of the U.S., the U.K., and
Australia to conduct joint operations. Over time, it will lead
these closest of allies to become militarily and politically
reliant upon other countries. In particular, there is a serious
risk that the U.K. will further increase its reliance on European
consortia. Such a development would not be in the interests of U.S.
exporters-or the U.S. as a whole.
The U.S. refuses very few export licenses for defense trade with
the U.K. or Australia: In a typical year, over 99.9 percent of
requests are approved. While the existing export license
system-the International Traffic in Arms Regulations
(ITAR)-ultimately denies almost no licenses to the U.K. or
Australia, the system does exist for an important reason: to
restrict foreign access to advanced U.S. technology. It is
therefore essential to note that the treaties do not simply
decontrol defense trade.
Rather, under the treaties, the U.S. has negotiated with the
British and Australian governments an approved list of private
sector defense- and counterterrorism-related entities in these
countries that are allowed end-user access to U.S. items. Both the
U.K. and Australia will protect U.S.-origin items as classified and
will require prior U.S. approval for the re-export of these
The fact that some defense firms operating in the U.K. are
foreign-owned (such as the Italian firm Finmeccania) does not raise
additional concerns; these firms also operate in the U.S.,
frequently supply U.S.-owned firms such as Boeing with crucial
components, and regularly receive export licenses under the
existing system. The treaties will not give them access to
U.S.-origin items beyond those with which they already work.
Finally, the U.S. has excluded certain particularly sensitive
items from eligibility under the treaties. Therefore, the treaties will
not expose U.S. technology to significant additional risks of
transfer to unauthorized foreign users. The treaties will instead
allow the existing market to operate more efficiently, reducing
costs for all and encouraging suppliers in all three countries to
bid against and purchase from each other. This will raise the level
of competition in all countries and reduce the ability of any one
company to dominate the procurement process. The result will be
lower costs, faster development cycles, better weapons systems, and
a renewal of the close and vital defense ties between the U.S., the
U.K., and Australia.
A Poor Show
Both Australia and the U.K. strongly back these treaties. The
Select Committee on Defence of the House of Commons in the U.K.
issued a report on the U.S.-U.K. treaty on December 11, 2007. Its
conclusion was cogent:
We are confident that Congressional scrutiny of the Treaty will
show that it is as much in the US interest as it is in the interest
of the UK. … The US export control system imposes a large
administrative burden on defence exports from the US to the UK.
While we respect the wish of the US to control its defence exports,
we consider that its current system of controls for exports from
the US to the UK is unduly burdensome and time-consuming. The US
and the UK are very close allies, cooperating closely on defence
and security. Our soldiers are fighting side by side in Iraq and
Afghanistan. It is vital to the interests of both the US and the UK
that the system should not prevent our Forces from getting access
to the equipment they need to fight effectively alongside their US
allies in current and future operations.
In response to the SFRC's delay, a Ministry of Defence spokesman
in Britain stated that "the Government remains fully committed to
the Defence Trade Co-operation Treaty and we are working closely
with the US Administration to find a way forward." Shadow Defense
Procurement Minister Gerald Howarth said, "We've been pressing for
this for two years and it's a pretty poor show that Congress has
failed to accord more support to its number one ally."
Delay Threatens Harm
The committee's decision, as explained by Chairman Biden and
ranking member Sen. Richard Lugar (R-IN), stemmed from their belief
that they lacked the necessary time to evaluate the
Administration's proposed amendments to the ITAR that are necessary
to put the treaties into effect. It does not reflect a lack
of enthusiasm on the part of the Administration or broad-based
opposition to the treaties in the Senate.
As such, it is incumbent on the Administration to ensure that
its proposed ITAR amendments are clearly laid out, and on the SFRC
to give careful consideration to the U.S.-U.K. and the
U.S.-Australia treaties at the earliest possible date. Further
delay threatens to harm the interests of U.S. exporters, the U.S.
Armed Forces, and the confidence of two of the U.S.'s closest
friends in the value of their alliance with this nation. The
U.S.-U.K. and the U.S.-Australia partnerships in defense are
cornerstones of our shared security. Prompt action to strengthen
these partnerships is vital.
Ted R. Bromund is Senior
Research Fellow in the Margaret Thatcher Center for Freedom, a
division of the Kathryn and Shelby Cullom Davis Institute for
International Studies, at The Heritage Foundation.
John C. Rood, "The U.S.-U.K Defense Trade Cooperation Treaty:
Entering a New Era of Transatlantic Defense Cooperation," remarks
at the Aerospace Industry Association Board of Governors Meeting,
November 16, 2007, pp. 2-3, at http://www.state.gov/t/us/rm/107514.htm
(September 25, 2008).
Rood, "Hearing on Defense Trade Cooperation Treaties," pp. 3-4.
 DiMascio, "Senators Delay Defense Trade
 Pfeifer and Sevastopulo, "Defence
treaty delay to hit UK."