Select Committee on Defence Written Evidence

Memorandum from BAE Systems UK


  The notice announcing the Defence Committee's intention to hold an enquiry into the UK-US Defence Trade Co-operations Treaty invited views from industry and others on the Treaty and its implementing arrangements. The purpose of this memorandum is to set out BAE Systems' views on the published Treaty. The associated implementing arrangements are not yet available to industry and are not therefore addressed in this paper.


  BAE Systems fully supports the aims of the UK-US Defence Trade Co-operation Treaty and believes that once implemented it will significantly improve the ability of defence companies in the United Kingdom and the United States, working with the two governments, to leverage their respective skills and technologies in meeting the needs of our armed forces, now and in the future.


  BAE Systems is the third largest global defence company, the largest British defence company and the 6th largest US defence company. Of its 96,000 highly skilled people, 43,500 work in the US and 32, 400 in the UK. Prior to the acquisition of Armor Holdings earlier this year the US accounted for 36% of overall sales and the UK accounted for 38%.


  The preamble to the Treaty recognises that, in order to develop closer security and defence co-operation between the UK and the US and, in support of that objective, to be able more effectively to capitalise on the strengths of the security and defence industries in both countries, there is a need for a new bilateral framework to facilitate the movement and defence material and technology within an approved community of organisations while, at the same time, ensuring that there are proper safeguards in place to prevent unauthorised access to such material and technology.

  BAE Systems is confident that the arrangements proposed in the Treaty—subject to the implementing arrangements still under negotiation between the two governments—will make it possible for companies within the approved community to co-operate more effectively and more quickly, to share their collective skills and knowledge in support of the armed forces of the two countries and to do so within a security environment, based in the UK on the Official Secrets Act, that will ensure that shared information and technology is properly safeguarded.

  Our primary objective is to ensure that the capabilities that exist not only within our own operations in the UK and the US but also in the wider UK and US defence industries are fully exploited to deliver the most capable and effective platforms and systems to the British and US armed forces and their ability to operate together. But we also believe there will be real benefits both to British and American taxpayers and to the U K and US companies within the approved community in terms of making more efficient and effective use of their combined investment in the technologies and skills that will be needed to ensure the UK and the US have the battle-winning capabilities of the future.

  BAE Systems firmly believes that the UK-US Defence Trade Co-operation Treaty provides an opportunity that must be seized to mirror the closeness of the political, security and military relationship between the UK and the US in the way in which the two defence industries work together. This will be to the advantage of the armed forces, the governments and the industries of both countries.

  BAE Systems hopes that Parliament and Congress will give the Treaty full and early endorsement.

14 November 2007

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