UNCLASSIFIED

1. Defense Technology Security Administration UNCLASSIFIED DoD Export Review Process and License Preparation Guidance Rizwan “Riz” Ramakdawala France 2009 UNCLASSIFIED

2. DTSA Mission To promote United States National Security interests by protecting critical technology while building partnership capacity

3. DTSA Strategic Goals • Preserve the U.S. defense edge by preventing the proliferation and diversion of technology that could prove detrimental to U.S. national security • Engage U.S. allies and partners to increase interoperability and protect critical technology • Facilitate the health of the U.S. industrial base • Align and utilize resources to support DTSA’s mission • Empower people and make DTSA a great place to work

4. Defense Technology Security Administration As of 27 March 2009

5. Department of Defense Role in Export Controls Commerce Export Administration Act (Dual-Use) State Arms Export Control Act (Munitions) Refer Refer Recommend Recommend Defense

6. Department of Defense Role in Export Controls • Defense perspective to the process: • National security review of export license applications • Developing multi-lateral control lists • Unique knowledge of systems and capabilities • Operators and designers of systems • National security dimension to strategic trade • Trade, foreign affairs, defense all part of the equation • Strategic element to defense cost and awareness • Expensive countermeasures • Knowledge of extant technologies

7. DoD Technology Transfer & Export Licensing Community • U.S. Military Services: • U.S. Air Force - International Affairs Division (SAF/IA) • U.S. Army – Deputy Assistant Secretary of the Army, Defense Exports & Cooperation (DASA (DE&C)) • U.S. Navy and U.S. Marine Corps - Navy International Programs Office (Navy-IPO) • DoD: • Defense Security Cooperation Agency (DSCA) • Joint Chiefs of Staff (JCS/J5) • Under Secretary for Policy • Under Secretary for Acquisition, Technology and Logistics • National Security Agency (NSA) • Other DOD Agencies (DIA, DISA, DLA, NGA, NRO, etc.)

8. DoD Review of Technology Transfers Assessing Impact on National Security • Factors Considered: • Policies (region, country & technology) • Level of technology (U.S. systems and countermeasures) • End-user & end-use history • Military operational impact • Inter-operability requirements • Bilateral, multilateral and international agreements • Foreign availability of comparable systems • Classified data transfers

9. Licensing Directorate UNCLASSIFIED

10. Licensing Directorate Mission • Review licenses and other actions* related to the export of controlled hardware and technology. • Develop and adjudicate DoD positions that address US national security concerns. • Transmit final position to the licensing agency and defend. • Develop, coordinate and provide DoD input to ITAR and EAR changes to licensing departments. • Outreach export briefing support *Includes Commodity Jurisdiction Requests, Enforcement Support, Advisory Opinions, Retransfer Requests

11. Licensing Directorate Director Munitions Division Chief Dual-Use Division Chief Voluntary Disclosures/ Commodity Jurisdiction Team Leader Analyst Space/Missile Team Leader Analyst (2) Red Team Leader Gold Team Leader Land Warfare Team Leader Analyst (4) Air Warfare Team Leader Analyst (4) 4 License Analysts Category 0 – 3 – 4 – 5 6 – 9A004 All IC manufacturing 4 License Analysts Category 1 – 2 – 7 – 8 – 9 – EAR99 All things AERO Naval Warfare/ Electronics Team Leader Analyst (3) Case Processing Export Admin (2) Case Processing Export Admin Special Projects Team Leader Licensing Directorate

12. What DTSA Provides to theLicensing Process • Warfighter Protection • Technical Expertise • National Security Perspective • Honest Broker • Program Insight

13. DoD Munitions License Review Timeline(Calendar Days) Reply to DTSA within 25 days Case Received from State/DTC Created at DTSA No Referred to DoD Reviewers "Prescreen" OR Yes 14 Day Extension (if DTSA approved) Position to State/DTC within 2 days Potential Escalation by DoD Reviewers w/in 2 days Draft Decision by DTSA w/in 2 days Escalation Process Escalate Yes No Position to State/DTC Position to State/DTC

14. Prescreen Process • Eligible Licenses • DSP-5 • DSP-73 • DSP-61 • Agreement amendments • General Correspondence requests for re-export/re-transfer

15. Prescreen Process (Cont’d) • Precedents: • Same End User Country/Identical Data • Rationale for new license? • Same End User Country/Different Data • What is different? • Different End User Country/Identical Data • Hardware (H/W) in furtherance of an agreement • Where in agreement is H/W identified/referenced? • Minor changes with no impact on technology transferred • US Government/US military end user • Non-US origin hardware/technology • Expansion of scope • Major or minor changes?

16. Prescreen Process (Cont’d) • Placement of explanatory information to aid prescreen process • “Commodity” block of DSP-5, DSP-73, DSP-61 • “Specific Purpose” block of DSP-5, DSP-73, DSP-61 • Electronic Licenses – “Purpose of Procurement” section • Cover Letter • First paragraph or as soon as possible thereafter

17. License Issued DoD Dual-Use License Review Timeline(Calendar Days) License Draft Final (LDF) Issue w/in 20 days Case Received from Commerce/BIS Created at DTSA No Reply to DTSA/LD within 10 days Tiger Team Resolution Referred to DOD Reviewers Yes Yes No LDF Challenged by DOD Reviewers w/in 2 days? In-House Review Escalation Process Position to Commerce/BIS w/in 30 days Yes DUSD Adjudicate Agreement Reached No Advisory Committee on Export Policy (ACEP) Review ILD Issued Position to Commerce/BIS w/in 30 days Operating Committee (OC) Review (OCLD Issued) Yes Interagency Agreement? No Escalate? Position to Commerce/BIS within 2 days No Yes No Escalate? No Yes POTUS Review Export Administration Review Board (EARB) Escalate? Yes

18. Statistics – DoD Caseload

19. Statistics – Average Time

20. Outcome of Calendar Year 2008 License Review Munitions Dual-Use Approve 67% Approve 3% Objection >1% Objection 9% Other (RWA, etc) 8% Other (RWA, etc) 2% Approve with Conditions 86% Approve with Conditions 24% 35,976 Licenses Reviewed 18,178 Licenses Reviewed

21. 2008 USG Licensing Statistics • Department of State: over 85,000 license applications; roughly 40% were referred to DoD for review. • Department of Commerce: ~20,000 license applications; roughly 90% were referred to DoD for review. • Why the difference? • Technology Security risk varies. DoD reviews both the applicable control lists and the license history and has notified the licensing departments, in writing, of those licenses types where DoD staffing is not required

22. Statistical Summary • Average case processing days 2008: Munitions: 12 • Dual Use: 13 • Total Cases CY 2008: • Munitions: 35,976 (51% increase over CY 07) • Dual Use: 18,178 (3% increase over CY 07) • Electronically staffed Munitions cases (currently): 69% • Analyst to License ratio (weekly): Munitions: 1: 14 • Dual Use: 1: 16 • Percentage of cases prescreened: Munitions: 61% • (last 90 days) Dual Use: 50%

23. Technology Directorate UNCLASSIFIED

24. Defense Technology Security AdministrationTechnology Directorate

25. Technology Directorate Mission • To provide comprehensive, in-depth technical analysis to support the DoD export review process. • To ensure that the DUSD (TSP/NDP)’s technology security objectives are considered in the planning and implementation of major international cooperative programs. • To chair Technical Working Groups in technology specific areas to pinpoint critical U.S. technologies and develop sound export control recommendations for leadership consideration. • To provide technical advice and consultation to U.S. Defense Industry on proposed international exports.

26. Technical Review Process • Technical review template: • What is the item? • What capabilities does it provide? • Are there other applications in addition to stated end-use? • What is the foreign availability? • What is the critical technology we are trying to protect? • Options: • Approve • Approve with provisos • Deny • Return without action • Justification is provided for all recommendations

27. Technical Review Process • Marketing Licenses (DSP-5) • Complete Systems Description • Aircraft, Engines • Build-to-Print (DSP-5) • 22 CFR 124.13 • Complete Technical Data • Temporary Exports (DSP-73) • “Mock-Up” Terminology • No Technical Data • Manufacturing License/Technical Assistance Agreements • Information Regarding End-User Capabilities • Define “the Box”

28. Program Technology Release Roadmap • The key to developing and implementing a program is to address technology release decisions as any other acquisition milestone (e.g., development, testing, production) • The best way to do so is to develop a “Technology Release Roadmap” which defines what technology decisions are required and when they are required to meet program goals • Work backward from the end state, set goals, brief and follow-up!

29. Methodology • In its simplest form, DTSA’s role is to answer the following questions: • The Who, What, When ,Where, How and Why of the export • Decide whether the export is in the National Security interests of the United States • Approve, limit or deny the export accordingly

30. Methodology - Who • Who are the recipients of the export? • Do they exist? For how long? • Who owns them? • What is their normal business? • What other work do they do? • What contacts/contracts do they have? • Whom do they employ (third parties)? • What is their track record for protecting US technology?

31. Methodology - What • What are we trying to protect and why? • What are the capabilities of the export? • Is it classified? • Is there foreign availability? • Is the export a precedent? • How does the U.S. use it? • How else could it be used? • What is the diversion scenario? • Can export be limited to address diversion concerns? • Different model? • Capability modification? • Are there countermeasures?

32. Methodology - When • When is the export required? • Will it support an ongoing operation? • What is the production schedule? • Are there contractual obligations? • What are the impacts of delay?

33. Methodology - Where • Where is the export required? • What are the regional impacts? • What is the effect on current capability? • Are there treaty implications? • Are there coalition implications?

34. Methodology - How • How will the export take place? • Government to Government? • End item or cooperative project? • Directly to the end user or through intermediaries? • Long or short duration? • Is there a logistics tail (spare parts, follow-on support)?

35. Methodology - Why • Why do we want to support/oppose the export? • Has the export been pre-coordinated? • Does it support US coalition building efforts? • Does the export match the end use? • Is the export required by the end user? • Will the export harm US national security? • Does it support US policies? • Does the export contribute to world peace?

36. License Preparation Guidance

37. Applicant’s Role • It is incumbent on the applicant to: • - Provide the information DoD needs to conduct a thorough technical review • - “Draw the box” for their export request in the application, so provisos are not imposed constraining the applicant for items they have no intention of exporting

38. Good Habits That Should Be Hard To Break • Focus on the basic elements of every license request: • country, commodity, end-user and end-use • Identify license precedents or case history. Include • copies • Provide clear, concise cover/transmittal letter • Learn the ITAR/EAR, both layout and content • Compliance before and after licensing • Improve knowledge through recurrent training

39. Reducing RWA's/ Avoiding Death by Proviso • Tell us in plain English: • What you are doing • What you are not doing (may be more important) • Avoid jargon, don't rely on program names • Describe the technical data flow between parties • ITAR Technical Data definition – Information which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions and documentation. • Review previous license provisos • Cite previous cases, more than one is OK

40. Reducing RWA's/Avoiding Death by Proviso • Government POC • Verify POC information provided • If none, what Service would be interested • Countries - not all countries are created equal • Temporary Licenses • Tell us how will you maintain control • Note that Government and Industry end-users are treated differently • Be realistic with quantities • List internet web-site to assist tech review • Bottom line, pass the “Grandma check.” Grandma should be • able to determine your intentions by reading your application

41. Foreign National Employment • Include the following information for DTSA review: • Foreign national’s biography/resume • Description of job duties • Company organization chart showing where the foreign national fits into the organization • List of all other foreign nationals working at the company, their job title, and where they fit in the organization • Copy of Non-Disclosure Statement • Copy of Technology Control Plan

42. USXports Impact and Applicant’s Role • We have improved our license review process by the deployment of a database called USXports. This database: • Accommodates electronically submitted licenses • Supports automated staffing • Allows “zero time” referral of cases • Permits rapid review of electronically submitted data Will do NONE OF THE ABOVE for ITAR licenses if you don’t submit to DTC electronically. Will NOT support rapid review if you don’t submit in PDF text searchable format.

43. Industry Briefings • DTSA is constantly asked if a company can come in to brief a program. • Wrong Answer: After the license is submitted (Too Late!) • Right Answer: When requested. • Best Answer: Before you start the program! • Gives us the opportunity to tell you our concerns • so you may be able to engineer around them • Provides a heads up to you of USG concerns • Remember, we are not buying your product, conduct brief accordingly

44. Summary • Good licenses make short reviews/limit provisos • Electronic licensing will only be as good as the inputs: • See first bullet • PDF text searchable • Industry Briefings – Let us know early when you are starting something new • Technology Release Road Maps • Clearly draw “the box” around every contemplated export

45. DTSA Overview Questions?