State Department Proposes ITAR Revisions, Clarifications
The State Department this week proposed several changes to its defense export regulations, including one that would clarify definitions for “export” and “reexport,” another that would change language in its Canadian exemption and a third that would revise its exemption for certain transfers to dual or third-country nationals. The agency also proposed corrections that would fix administrative errors in the regulations. Comments on the proposed changes, which were released Feb. 1, are due April 4.
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The first proposed change would revise the definitions for export and reexport in the International Traffic in Arms Regulations to clarify how the State Department assesses releases of technical data to foreigners. The agency said releases of technical data to a foreign person should no longer count as an export to the country where that person held “former” citizenship or residency status. Instead, the release of data will count as an export only to any countries in which the foreign person “currently holds citizenship or permanent residency,” the State Department said.
“The Department assesses that a foreign person’s former citizenship or permanent residency status in a country should not be deemed to automatically result in an export or reexport to that country,” the agency said. The State Department said this change will give more opportunities for foreigners to participate in ITAR-regulated activities if they are no longer citizens or permanent residents of “certain” countries.
In another change, the State Department proposed to replace the term “national” with the ITAR defined-term “person” in its Canadian exemption, which allows certain U.S. exports to be sent to Canada without a license. The agency said the change will make the wording “consistent with how foreign persons are defined in the ITAR.”
The agency also proposed to remove a phrase from its exemptions for intra-company, intra-organization and intra-governmental transfers that says “nationality does not, in and of itself, prohibit access to defense articles.” Certain releases do, in fact, constitute an export to all countries in which a person holds citizenship, the State Department said.
“This proposed change is not intended to convey any change to the Department’s long-standing position that the purpose of vetting employees from” certain countries “is to mitigate diversion,” the agency said. It proposed the revision because “simply identifying nationalities with no substantive contacts with” certain countries “is not a precondition to rely on to use the exemption for intra-company, intra-organization, and intra-governmental transfers to dual or third-country nationals.”
The agency also proposed a change to clarify how nondisclosure agreements are executed under the exemption. The screened employee, not the end-user or consignee, must execute the NDA to “provide assurances that said employee will not transfer any unclassified defense articles to unauthorized persons,” the State Department said.
In its final proposal, the agency hopes to correct administrative errors in the ITAR’s voluntary disclosures section to provide the correct references to exemptions in the Defense Trade Cooperation Treaties between the U.S. and Australia and the U.S. and the U.K. The agency also proposed to “streamline” its section on voluntary disclosures by “simply referencing the relevant ITAR sections” that “describe the duties of persons to notify the Directorate of Defense Trade Controls of particular activities.”