US-Australia Sign Defense Trade Cooperation Treaty
September 2007
The Australia-United States of America Treaty on Defense Trade Cooperation is underway and, if ratified, would permit some license-free exporting of defense goods and services between the two countries. The important point is that if US Senate ratifies the treaty, there could be significant relaxations in US export restrictions on defense articles under the International Traffic Arms Regulations (ITAR). The State Department approved 2361 licenses and 312 agreements for Australia in 2006. The United Kingdom is the only other country to have such a treaty United States, but the US Senate has not yet ratified the UK-US treaty. The ITAR already gives certain favorable and license free treatment to exports to Canada.
The treaty would reduce US export licensing requirements when the transaction involves defense articles, equipment, spare parts, services, and technical data destined for “approved communities” or “trusted communities”. Private companies would not need licenses as long as Australia is the end-user of any security and defense projects, research, development, production and support.
“Approved communities” would include both Australian and U.S. governments and companies in both countries that have passed the qualification criteria which is still yet to be determined. This seems to point towards a government registration process to certify companies as “approved,” perhaps similar to the defense trade company registration systems in place in the United States and Canada. These approved companies must also have existing arrangements of security to be able to export license free, they must have facility clearance, business history, export licensing and compliance records, and relationships to both countries.
But don’t hold your breath, and don’t hold off in submitting that new export application for Australia. No US export requirements have changed yet, and none will for a long time. Many people are asking when the Treaty will be finalized, unfortunately, this will take some time. From the US standpoint, the first step is for the US Senate to ratify the treaty, and then the US and Australian Government must work out the actual operational details and parameters.
