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Export Licence Exemption for Defence Goods Transfers by Federal Agencies Amended

The State Department has issued a final rule that effective 19 April amends the International Traffic in Arms Regulations to clarify when exports, re-exports, re-transfers, temporary imports and performance of a defence service (transfers) may be made by or for a U.S. government agency without a licence, including by U.S. government employees in the performance of their official duties. Specifically, the scope of this exemption is expanded to allow for permanent exports, re-exports and re-transfers, in addition to temporary exports and imports, and to allow transfers by third parties acting for the U.S. government.

Revisions being made by this rule include the following.

  • authorises those transfers made by a U.S. government department or agency for (i) official use by the U.S. government, (ii) carrying out certain international agreements or arrangements, (iii) carrying out foreign assistance or sales programmes authorised by statute, or (iv) carrying out certain Department of Defense security co-operation programmes and activities
  • clarifies that the release of technical data to persons or entities of a country in section 126.1 is not authorised even if they are in a contractual relationship with the U.S. government
  • clarifies that authorisation of a transfer under section 126.4 is for ITAR purposes only and does not (i) constitute any other form of U.S. government approval that may be required or (ii) absolve parties of the requirement to comply with any applicable U.S. government processes, procedures or practices, including the need for exports of items on the Missile Technology Control Regime annex to receive case-by-case review
  • clarifies that exports made in compliance with section 38(b)(2) of the Arms Export Control Act are excluded from the licencing requirements of the AECA and do not require export authorisation from State’s Directorate of Defense Trade Controls
  • clarifies that the U.S. government agency or entity exporting pursuant to this licencing exemption must obtain appropriate end-use assurances from the recipient
  • clarifies that the ITAR do not require an authorisation for the return of an exported defence article provided it has not been subsequently transferred without authorisation or by licence or other approval pursuant to another provision of the ITAR
  • clarifies that exporters no longer need to provide U.S. Customs and Border Protection with a written certification of compliance and that the ITAR do not impose an electronic export information fling requirement on exports via U.S. government vehicles, aircraft and vessels
  • states that DDTC authorisation (in the form of a licence or other approval) is required for any change in the end-use or end-user
Content provided by Picture: HKTDC Research
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