International Law Advisory - United States and United Kingdom Enter Into Defense Trade Cooperation Treaty That Would Ease ITAR License Requirements For Exports to UK

As reported in the press over the last several weeks, the United States and United Kingdom governments have entered into a treaty that creates a framework for closer defense and security cooperation between the countries.  The text of this treaty is not yet publicly available, but a summary of the treaty, and an associated question and answer paper, have been published.

The treaty, should it be ratified, would result in a focused easing of licensing requirements for defense articles supplied between the United States and the United Kingdom, in circumstances where the U.S. or U.K. government is the ultimate end user.  Based on the publicly-available summaries of the treaty, specific license requirements under the International Traffic in Arms Regulations (“ITAR”) would be eliminated for many ITAR-controlled goods and technology (subject to certain exclusions, which have not yet been determined) exported either to the U.K. government (and there would be reciprocal treatment under the U.K. export licensing regime for exports to the U.S. government) or to U.K.-based government contractors that have been pre-approved by both governments for license-free treatment.  Defense articles exported to the United Kingdom would be treated as “classified” under the U.K. Official Secrets Act, thus potentially resulting in enhanced internal control requirements for companies operating in the U.K. that receive goods or technology under this license-free regime.

The treaty must be presented to the United States Senate for advice and consent before it can be ratified by the President, and afterward the U.S. State Department would amend the ITAR to take into account the provisions of the treaty.  These measures will likely take some time (the governments are targeting early 2008 for the treaty to enter into force).  Note that the process of treaty ratification and implementation could result in features that are not contemplated in the currently-available summaries.  In the United Kingdom, the implementation process will likely be less complex – the treaty will be subject to debate in Parliament for 21 days before it will be subject to ratification. It is not expected that U.K. export controls regulations will require substantial amendment (i.e., U.K. regulations currently allow for the export of a wide range of military-controlled items to the United States without a license).

We will monitor the progress of this new U.S.-U.K. treaty, and provide additional commentary once its text becomes available.  In the meantime, please contact Ed Krauland at 202.429.8083 in Washington, DC or David Lorello at +44 20 7367 8007 in London if you have any questions.