Tuesday, October 12, 2004

ITAR? No ta!

If I were a betting man, I would wager that not one in a hundred of our readers actually knows what ITAR stands for - not that there is any shame in that. Only with the advantage of advanced warning could I tell you what it means. However, mystery or not, ITAR is important or, to be more specific, the waiver is or, to be even more specific, the lack of one.

To clear up one part of the mystery, ITAR stands for "International Traffic in Arms Regulations". It is this legislation that governs the issue of export licences of military equipment (including dual-use technology) from the US, imposing considerable restrictions on what can be exported, and to whom, and creating horrendous red-tape and delays, even when export is permitted.

Predictably, the UK, which does considerable business with US military equipment producers, has been anxious to obtain a "waiver" under US law, which would allow a much more relaxed regime, allowing much more rapid transfer of technology and easier co-operation.

Nevertheless, the path towards the "waiver" has been long and tortuous. Clinton was not interested, and neither was Bush Snr, but his son seemed and, last year, it looked as if the UK (and Australia) were going to be successful in gaining the coveted status of exempt nations.

However, earlier this month, signs that things were amiss became public when Harry Stonecipher, CEO of Boeing openly stated that he was being prevented from sharing even non classified technology with the UK.

Now, the bad news is official. According to DefenseNews (11 October), after last-minute negotiations, at the end of a prolonged campaign spanning many years, the provision for the waiver was stripped from the 2005 Defense Authorization Act, in which it had been inserted. The President was given no choice once the both Houses of Congress had made it known they would not pass the Bill by its 8 October deadline, unless it was removed.

The deletion was a blow to the Bush administration, which had wanted to reward Blair for his support in Iraq, but it represented a victory for House conservatives who were worried that such exemptions would make it easier for critical technology to land in enemy hands.

Although proponents of the waiver had argued that such exemptions would boost trade and would help U.S. troops work better with close allies, these arguments were rejected by Rep. Duncan Hunter, R-Calif., chairman of the House Armed Services Committee, and Rep. Henry Hyde, R-Ill., chairman of the House International Relations Committee, who led the campaign to block the proposal.

Cited by DefenseNews, Hunter said, "The problem is not with the leadership of Australia or Britain… (it) is the porous nature of the system in which front companies and unscrupulous individuals move technologies to people who one day may be trying to kill not only Americans on the battlefield but Brits and Aussies too."

Although nothing of this has percolated into the British media, defence secretary Hoon will have taken the rejection badly. In a stinging later last July, he told Donald Rumsfeld that congressional opposition to the waivers could steer London away from billions of dollars’ of U.S. weapon purchases.

"The waiver was important because of the increasingly globalized nature of the defence industry," one MoD official said. "Under ITAR, American and British companies are unable to have collaborative development of technology without an awful lot of red tape."

But this is more than a matter of "red-tape". In July 2003, the House of Commons Defence Committee on Defence Procurement, in its Eighth Report of Session 2002–03, put the issue in perspective when it wrote (para 54):

The importance of the waiver extends beyond its immediate procedural and legal scope, because it is a touchstone for our relations with our closest ally. A failure to implement this first modest step in bringing closer together the industrial side of that alliance has the potential to become the thin end of a damaging and undesirable wedge in the political side.
John Howe, of Thales-UK, underscored this when he noted:

…what is actually being asked for is something quite modest, it is a waiver of ITAR regulations in relation to unclassified information, so it ought not to raise any heroic problems of security classification or national security at all. We are disappointed therefore about the suspicion with which some in Congress have viewed the ITAR waiver, not only because the benefits for both the US and UK remain unfulfilled, but more importantly because of the message that the delay conveys about the nature of the UK-US relationship.
What that all boils down to, as reported in earlier Blogs, is that the UK-US relationship is breaking down – and not surprising as we increasingly involve ourselves with European partners which are known to have passed on US technology to potential enemies of America. Quite simply, some powerful people do not like our friends, and we are paying the price.

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