Export Control Reform Presentation

Transcription

1 Export Control Reform Presentation Todd E. Willis Division Chief, Dual-Use Licensing Defense Technology Security Administration U.S. Department of Defense

2 Agenda Overview of Defense Technology Security Administration (DTSA) Who/What is DTSA Licensing volume Export Control Reform Current issues/proposed changes Implementation

3 Overview of DTSA 3

4 Defense Technology Security Administration Director, Defense Technology Security Administration (DTSA) Mr. James Hursch Military Assistant, DTSA Deputy Director, DTSA Mr. Anthony Aldwell Licensing Directorate Technology Directorate Policy Directorate Space Directorate Management Directorate -- License Reviews -- Commodity Jurisdictions -- Voluntary Disclosures -- Regulations -- Aeronautical/JSF -- Electronics -- Information Systems/ Communications -- Missile Defense/Space -- NBC/Land/Naval/ Materials/Machine Tools -- Sensors & Lasers -- Int l Regimes -- Guidelines -- End-user Reviews -- CFIUS -- UK/AS Treaties -- Monitoring/License Enforcement -- Technical Exchanges -- Tech Data Reviews -- Personnel -- Security -- Logistics

5 DTSA s Mission & Strategic Goals To promote United States national security interests by protecting critical technology while building partnership capacity Preserve critical US military technological advantages Support legitimate defense cooperation with foreign friends and allies Assure the health of the defense industrial base Prevent proliferation and diversion of technology that could prove detrimental to U.S. national security Implement enterprise-wide resources to ensure organizational structures, processes and procedures effectively support DTSA s mission 5

6 U.S. Export Controls CONTROLLED BY THE U.S. CONTROLLED BY MULTILATERAL AGREEMENT (WASSENAAR ARRANGEMENT, NUCLEAR SUPPLIERS GROUP, AUSTRALIA GROUP, MISSILE TECHNOLOGY CONTROL REGIME, ETC) 6

7 DoD Review Statistics Thousands Caseload Average Age Days

8 1 st Jan 31 st Dec, 2009 License Review Munitions Dual-Use Approve >63% Approve 1% Approve with Conditions 25% Other (RWA, etc) 11% Objection <1% Approve with Conditions 89% Other (RWA, etc) 2% Objection 8% 38,374 Licenses Reviewed 16,280 Licenses Reviewed

9 Current System U.S. has a robust export control system, but it is rooted in the Cold War System must be updated to address current threats Current system may not allow for timely or flexible cooperation with allies or partners Prolonged U.S. Interagency Commodity Jurisdiction clashes: Whether State or Commerce issues the license. Past reform efforts have nibbled around the edges for too long Short term reform efforts at the detriment of fundamental reform. 9

10 Export Control Reform (ECR) 10

11 DoD: Basic Principles for a New System Protect the Crown Jewels of U.S. Technology Maintains important technological advantage Certain Countries and Entities Should Not Receive U.S. Exports Deny all resources possible to terrorists, adversary states, and proliferators Retain the legal authority to impose unilateral sanctions Fulfill International Export Control and Nonproliferation Obligations Wassenaar Arrangement, the Nuclear Suppliers Group, the Australia Group, and the Missile Technology Control Regime Expedited Technology Sharing and Cooperation with Allies and Partners 11

12 Key Recommendations The Administration has determined that fundamental reform of the U.S. export control system is required in each of its four component areas, with consolidation into a: Single Control List; Single Primary Enforcement Coordination Agency; Single Information Technology (IT) System; and Single Licensing Agency.

13 Single Control List Problem: The U.S. Government (USG) maintains two different primary control lists Commerce Control List; U.S. Munitions List These lists have fundamentally different structures Different levels of specificity and definitions Results: inherent friction between the two systems. A key underlying problem is the lack of an agreed definition of what constitutes a defense article

14 Single Control List Solution: Creation of a Single Control List based on tiers of control and a catch all control for: Sanctioned end-users and destinations; Proscribed entities; Proliferation; Counterterrorism end-uses. The list will be populated using independent objective criteria for each tier Screened to add new items and to downgrade controlled items Screening against these criteria would result in decontrol of unilateral items as appropriate a series of proposals to the multilateral regimes to add or remove controls to harmonize the multilateral regime controls and the new U.S. control list.

15 Single Primary Enforcement Coordination Agency Problem: There are a multitude of agencies and authorities involved in illegal export investigations The largest enforcement authorities are within the Department of Homeland Security (DHS) DHS has enforcement authority for all three primary licensing agencies export control activities, yet two of the three primary licensing agencies Commerce and the Treasury have their own enforcement authorities as well. Although the one licensing agency with the largest volume of cases, State, works with DHS s Immigration and Customs Enforcement (ICE) on enforcement issues, it has no enforcement branch of its own.

16 Single Primary Enforcement Coordination Agency Solution: Creation of a Primary Enforcement Coordination Agency responsible for most criminal and administrative export investigations, would eliminate duplicative investigative programs The agency would also be responsible for investigations related to sanctions violations with regard to the export of items, which would coordinate with the FBI and de-conflict regarding counterterrorism, counterintelligence, and counterespionage. The designation of a primary enforcement coordination agency as the fusion center would Eliminate duplication Reduce costs Enhance real-time access Results: improved enforcement capabilities

17 Problem: Single Information Technology (IT) System Every agency involved in the processing of export licenses have their own internal licensing databases, none of which are accessible to or easily compatible with the other. Enforcement authorities share access to the Automated Export System (AES), which is being subsumed into the International Trade Data System (ITDS), but also maintain their own stand-alone information systems. None of the enforcement authorities have direct access to any of the licensing systems to quickly determine if an item stopped at a port is controlled. Many U.S. exporters have built IT systems to comply with the myriad requirements of the U.S. export control system yet the USG has no such comprehensive system of its own.

18 Single Information Technology (IT) System Solution: Creation of a single IT system that would provide a comprehensive database for export license application. It would create a single on-line license application system for exporters and provide the USG end-to-end visibility from the filing of an export license application to an actual export. The result is a transparent, predictable and timely system, with seamless export control information sharing between all relevant agencies, and enhanced enforcement capabilities.

19 Single Licensing Agency Problem: There are three different primary licensing agencies within the USG Commerce, State, and the Treasury Collectively processed in excess of 130,000 licenses last year. There are instances when a single exporter must seek licenses from more than one licensing agency for a single transaction. The structure of the current U.S. export licensing system in itself undermines the ability of the USG to know what it authorizes for export.

20 Single Licensing Agency Solution: Creation of a Single Licensing Agency (SLA) as the one stop shop. This Agency would work closely with other USG agencies and departments to review export license applications and maintain the control list. The SLA concept builds on the benefits of having created a single control list and IT system, and having designated a single primary enforcement coordination agency. Results: licensing process that is transparent, predictable, and timely.

21 ECR Implementation 21

22 Implementation To deploy the new system, the Administration is taking steps to make specific reforms, most of which can be initiated immediately and implemented without legislation. The plan to deploy has three phases, with full deployment of the new system in Phase III. Implementation of Phase III will require legislation.

23 Current Status We are coming to the end of the first phase of our review of the U.S. export control system. The assessment of our current export control system tasked by the President in late 2009 was submitted by an interagency task force on January 29, and has been the topic of a series of meetings as the report s recommended reforms are considered. The purpose of the review is to make sure our controls focus on those items that must be closely protected and to move to a system that addresses current and anticipated threats. The two specific reforms the President mentioned, Encryption and Dual- and Third Country-Nationals, are regulatory changes that we are finalizing. They are consistent with the goals of the on-going review of the export control system.

24 Questions? 24