Amendment to the International Traffic in Arms Regulations: Removing Requirement for Prior Approval for Certain Proposals to Foreign Persons Relating to Significant Military Equipment, 15388-15389 [2010-6905]

Agencies

• DEPARTMENT OF STATE

[Federal Register Volume 75, Number 59 (Monday, March 29, 2010)]
[Proposed Rules]
[Pages 15388-15389]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-6905]


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DEPARTMENT OF STATE

22 CFR Parts 124, 126, and 129

[Public Notice: 6931]
RIN 1400-AC62


Amendment to the International Traffic in Arms Regulations: 
Removing Requirement for Prior Approval for Certain Proposals to 
Foreign Persons Relating to Significant Military Equipment

AGENCY: Department of State.

ACTION: Proposed rule.

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SUMMARY: The Department of State is amending the International Traffic 
in Arms Regulations (ITAR) to remove the requirements for prior 
approval or prior notification for certain proposals to foreign persons 
relating to significant military equipment at section 126.8 of the 
ITAR.

DATES: Effective Date: The Department of State will accept comments on 
this proposed rule until May 28, 2010.

ADDRESSES: Interested parties may submit comments within 60 days of the 
date of the publication by any of the following methods:
     E-mail: DDTCResponseTeam@state.gov with an appropriate 
subject line.
     Mail: Department of State, Directorate of Defense Trade 
Controls, Office of Defense Trade Controls Policy, ATTN: Regulatory 
Change, Section 126.8, SA-1, 12th Floor, Washington, DC 20522-0112.
     Persons with access to the Internet may also view this 
notice by going to the U.S. Government regulations.gov Web site at 
https://regulations.gov/index.cfm.

FOR FURTHER INFORMATION CONTACT: Director Charles B. Shotwell, Office 
of Defense Trade Controls Policy, Department of State, Telephone (202) 
663-2803 or Fax (202) 261-8199; E-mail DDTCResponseTeam@state.gov. 
ATTN: Regulatory Change, Section 126.8.

SUPPLEMENTARY INFORMATION: Effective September 1, 1977, the Department 
of State amended the International Traffic in Arms Regulations (ITAR) 
at 22 CFR 123.16, to require Department of State approval before a 
proposal or presentation is made that is designed to constitute the 
basis for a decision to purchase significant combat equipment, 
involving the export of an item on the U.S. Munitions List, valued at 
$7,000,000 or more for use by the armed forces of a foreign country (42 
FR 41631, dated August 18, 1977). Also, 22 CFR 124.06, entitled 
``Approval of proposals for technical assistance and manufacturing 
license agreements,'' was amended to require similar prior approval 
requirements with respect to proposals and presentations for technical 
assistance and manufacturing license agreements involving the 
production or assembly of significant combat equipment.
    ``Proposals to foreign persons relating to significant military 
equipment'' became section 126.8 in a final rule effective January 1, 
1985 (49 FR 47682, dated December 6, 1984). Section 126.8 did not 
require prior approval of the Department of State when the proposed 
sale was to the armed forces of a member of the North Atlantic Treaty 
Organization (NATO), Australia, Japan, or New Zealand, except with 
respect to manufacturing license agreements or technical assistance 
agreements.
    A prior notification requirement, instead of prior approval, was 
added to section 126.8 in a final rule effective March 31, 1985 (50 FR 
12787, dated April 1, 1985). Prior notification to the Department of 
State was required 30 days in advance of a proposal or presentation to 
any foreign person where such proposals or presentations concern 
equipment previously approved for export.
    The current section 126.8 requires prior approval or prior 
notification for certain proposals and presentations to make a 
determination whether to purchase significant military equipment valued 
at $14,000,000 or more (other than a member of NATO, Australia, New 
Zealand, Japan, or South Korea), or whether to enter into a 
manufacturing license agreement or technical assistance agreement for 
the production or assembly of significant military equipment, 
regardless of dollar value.
    These types of proposals and presentations usually involve large 
dollar amounts. Before the defense industry undertakes the effort 
involved in formulating its proposals and presentations, if there is 
any doubt that the corresponding license application or proposed 
agreement would not be authorized by the Department of State, the 
industry may request an advisory opinion (See 22 CFR 126.9). The 
written advisory opinion, though not binding on the Department, helps 
inform the defense industry whether the Department would likely grant a 
license application or proposed agreement. Currently, the time between 
submitting a license application or proposed agreement and obtaining a 
decision from the Department of State whether to authorize such 
transactions has been decreased sufficiently that requiring prior 
approval or prior notification for proposals is unnecessary and imposes 
an administrative burden on industry.
    References to Sec.  126.8 have been removed at Sec. Sec.  124.1(a), 
126.13, and 129.8(c).

Regulatory Analysis and Notices

Administrative Procedure Act

    This proposed amendment involves a foreign affairs function of the 
United States and, therefore, is not subject to the procedures 
contained in 5 U.S.C. 553 and 554.

Regulatory Flexibility Act

    Since this proposed amendment involves a foreign affairs function 
of the United States, it does not require

[[Page 15389]]

analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This proposed amendment does not involve a mandate that will result 
in the expenditure by State, local, and tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any 
year and it will not significantly or uniquely affect small 
governments. Therefore, no actions were deemed necessary under the 
provisions of the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This proposed amendment has been found not to be a major rule 
within the meaning of the Small Business Regulatory Enforcement 
Fairness Act of 1996.

Executive Orders 12372 and 13132

    This proposed amendment will not have substantial direct effects on 
the States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this amendment does not have 
sufficient federalism implications to require consultations or warrant 
the preparation of a federalism summary impact statement. The 
regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this amendment.

Executive Order 12866

    This proposed amendment is exempt from review under Executive Order 
12866, but has been reviewed internally by the Department of State to 
ensure consistency with the purposes thereof.

Executive Order 13175

    The Department of State has determined that this rulemaking will 
not have tribal implications, will not impose substantial direct 
compliance costs on Indian tribal governments, and will not preempt 
tribal law. Accordingly, the requirement of section 5 of Executive 
Order 13175 does not apply to this rulemaking.

Paperwork Reduction Act

    This proposed amendment does not impose any new reporting or 
recordkeeping requirements subject to the Paperwork Reduction Act, 44 
U.S.C. Chapter 35.

List of Subjects

22 CFR Parts 124 and 129

    Arms and munitions, Exports, Technical assistance.

22 CFR Part 126

    Arms and munitions, Exports.

    Accordingly, for the reasons set forth above, Title 22, Chapter I, 
Subchapter M, parts 124, 126, and 129 are proposed to be amended as 
follows:

PART 124--AGREEMENTS, OFF-SHORE PROCUREMENT AND OTHER DEFENSE 
SERVICES

    1. The authority citation for part 124 is revised to read as 
follows:

    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 
(22 U.S.C. 2752, 2778, 2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977 
Comp., p. 79; 22 U.S.C. 2651a; 22 U.S.C. 2776; Pub. L. 105-261.

    2. Section 124.1 is amended by revising paragraph (a) to read as 
follows:


Sec.  124.1  Manufacturing license agreements and technical assistance 
agreements.

    (a) Approval. The approval of the Directorate of Defense Trade 
Controls must be obtained before the defense services described in 
Sec.  120.9(a) of this subchapter may be furnished. In order to obtain 
such approval, the U.S. person must submit a proposed agreement to the 
Directorate of Defense Trade Controls. Such agreements are generally 
characterized as manufacturing license agreements, technical assistance 
agreements, distribution agreements, or off-shore procurement 
agreements, and may not enter into force without the prior written 
approval of the Directorate of Defense Trade Controls. Once approved, 
the defense services described in the agreements may generally be 
provided without further licensing in accordance with Sec. Sec.  124.3 
and 125.4(b)(2) of this subchapter. The requirements of this section 
apply whether or not technical data is to be disclosed or used in the 
performance of the defense services described in Sec.  120.9(a) of this 
subchapter (e.g., all the information relied upon by the U.S. person in 
performing the defense service is in the public domain or is otherwise 
exempt from licensing requirements of this subchapter pursuant to Sec.  
125.4 of this subchapter). This requirement also applies to the 
training of any foreign military forces, regular and irregular, in the 
use of defense articles. Technical assistance agreements must be 
submitted in such cases. In exceptional cases, the Directorate of 
Defense Trade Controls, upon written request, will consider approving 
the provision of defense services described in Sec.  120.9(a) of this 
subchapter by granting a license under part 125 of this subchapter.
* * * * *

PART 126--GENERAL POLICIES AND PROVISIONS

    3. The authority citation for part 126 continues to read as 
follows:

    Authority:  Secs. 2, 38, 40, 42 and 71, Pub. L. 90-629, 90 Stat. 
744 (22 U.S.C. 2752, 2778, 2780, 2791 and 2797); E.O. 11958, 42 FR 
4311; 3 CFR, 1977 Comp., p. 79; 22 U.S.C. 2651a; 22 U.S.C. 287c; 
E.O. 12918, 59 FR 28205; 3 CFR, 1994 Comp., p. 899; Sec. 1225, Pub. 
L. 108-375.


Sec.  126.8  [Removed and Reserved]

    4. Section 126.8 is removed and reserved.
    5. Section 126.13 is amended by revising paragraph (a) to read as 
follows:


Sec.  126.13  Required information.

    (a) All applications for licenses (DSP-5, DSP-61, DSP-73, and DSP-
85), all requests for approval of agreements and amendments thereto 
under part 124 of this subchapter, and all requests for written 
authorizations must include a letter signed by a responsible official 
empowered by the applicant and addressed to the Directorate of Defense 
Trade Controls, stating whether:
* * * * *

PART 129--REGISTRATION AND LICENSING OF BROKERS

    6. The authority citation for part 129 is revised to read as 
follows:

    Authority:  Sec. 38, Pub. L. 104-164, 110 Stat. 1437, (22 U.S.C. 
2778).


Sec.  129.8  [Amended]

    7. Section 129.8 is amended by removing paragraph (c).

    Dated: March 3, 2010.
Ellen O. Tauscher,
Under Secretary, Arms Control and International Security, Department of 
State.

[FR Doc. 2010-6905 Filed 3-26-10; 8:45 am]
BILLING CODE 4710-25-P