Administration seeks to speed State export review process

The Joint Strike Fighter (JSF) was designed as much to set a new standard in cooperation among international military forces as it was to be the United States’ new workhorse fighter.  

Since the program’s inception, however, Great Britain and other countries sharing responsibilities for development have complained that onerous U.S. export-control rules have hampered cooperation. Pentagon officials have complained, too, that the State Department rules that control the export of sensitive technologies are unnecessarily restrictive.

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A White House directive released this week to change those rules may give both sides hope, however. The administration plans to spend more money on the export review process and to introduce procedural changes designed to speed technology exchanges.   

Officials say the changes to the export control system could become a first step in a long process of reforming U.S. defense trade rules that will make it easier to integrate international forces.

For JSF, which has grown into the Pentagon’s largest acquisition program, strict export control laws have controlled conversations, e-mails and paper flows among development officials, not just the actual transfer of equipment, from the various countries participating in the program. For example, British employees working on the JSF, now dubbed the F-35 Lightning II, need a license to move to offices in the United States, and vice versa.

Britain is putting about $2 billion into the development of JSF. Rolls-Royce, based in the United Kingdom but with offices in the United States, is helping to build an engine variant with General Electric.

The delays are more than an inconvenience. They have the potential to raise costs for the fighter.

Difficulties with the high-profile JSF brought export control concerns to a boil over the past few years. The administration’s move, though, will also came as welcome news to Pentagon officials who are not involved with the fighter but who are similarly interested in forging closer relationships with U.S. allies — by sharing secure communications and intelligence-gathering technologies, for example.

American companies have also lobbied for changes to the export licensing process. These companies argued that the rules were impeding their ability to carry out contracts on already existing defense cooperation agreements with other countries.

Moreover, the process affects U.S. trade and the ability of American companies to compete in world markets. Many companies that sell so-called dual-use technology — civilian technology that can have military applications — are also mired in the protracted and difficult process.

“These measures are important to strengthening America’s national security, technological leadership and industrial competitiveness, and they will also make the country’s export control system more predictable and transparent,” said Jeff Adams, Lockheed Martin’s corporate spokesman.

The State Department processes more than 65,000 export licenses a year. About 80 percent of those are from companies that aren’t prime contractors but rather supply companies.

“The White House is obviously moving in the right direction recognizing that you have to update rules and regulations to have the right balance between security and commerce,” said Rep. Don Manzullo (R-Ill.), one of the co-chairmen of the bipartisan congressional export control working group.

Together with Rep. Brad Sherman (D-Calif.), Manzullo introduced a bill last year that sought to improve defense trade controls. Several of the bill’s provisions are included in President Bush’s directives, Manzullo said. Manzullo said he and other lawmakers worked with the White House on the current changes.

Bush’s export control directive mandates the commitment of additional financial and other resources, as well as procedural reforms, to speed the processing of export license applications for items controlled under the U.S. munitions list.

Meanwhile, an electronic licensing system will be upgraded to permit the submission of all types of defense trade licenses and to enable all agencies to access the same electronic information.

The State Department has to issue a decision on defense trade export license applications within 60 days. In some cases, it has taken the department months to reach a decision, although an ongoing effort to speed license applications has reduced the backlog of applications by 50 percent since last April, according to the administration.

Bush has yet to send out a detailed package of the administration’s recommendations to the Hill and industry. Some question whether the directives will in fact be implemented promptly at the State Department.

The White House’s announcement on Tuesday comes on the heels of an intense lobbying campaign from an industry coalition founded and led by the National Association of Manufacturers (NAM) and the Aerospace Industries Association (AIA).  

NAM President and CEO John Engler and others asked for the change at the highest levels of the administration, including Secretary of State Condoleezza Rice and Deputy Secretary of Defense Gordon England.

White House Chief of Staff Josh Bolten and the National Security Council’s Dan Price oversaw the recommendations, according to several sources.

“In order to efficiently share technology with our allies, the administration is updating a system that had not kept pace with globalization and rapid technological changes,” Engler said.

“Making improvements to the export control system will increase our ability to fight shoulder to shoulder with our allies and friends around the world,” AIA President and CEO Marion Blakey said.

“It also helps ensure the U.S. armed forces have the best weapons and equipment available to do their job, at the best price to the taxpayer.”