Memorandum from Northrop Grumman UK
EXECUTIVE SUMMARY
1. This submission records the views of
Northrop Grumman UK on the Treaty, its implementing arrangements
and its effectiveness in removing barriers to defence trade and
technology transfer, and improving cooperation between the US
and UK Armed Forces.
2. Northrop Grumman has a long standing
relationship with and presence in the UK dating back more than
20-years and today the UK remains a critically important market
for the company as a supplier base and a source for technology
partners.
3. In January 2006 the chairman and chief
executive officer of Northrop Grumman Corporation, Ron Sugar,
launched the company's corporate office in London to consolidate
its UK business development and customer interface activities
and to grow its business both in the UK and in other international
markets. His commitment to furthering U.S.-UK defence trade cooperation
during his tenure as chairman of the board of governors of the
Aerospace Industries Association (AIA) and the company's response
to the priorities articulated in the UK Defence Industrial Strategy
led to the appointment in March 2006 of a U.S.-based Northrop
Grumman executive to work to help foster the improvement of U.S.-UK
technology sharing. This executive has worked closely with U.S.
and UK officials since that time and is now leading the U.S. industry
effort on behalf of the AIA in support of the U.S.-UK Defence
Trade Cooperation Treaty. Representing the AIA, he will give evidence
to the House of Commons Defence Select Committee on 21 November
2007.
4. Northrop Grumman strongly recommends
that the UK Government endorses the Defence Trade Cooperation
Treaty. Northrop Grumman recommends that UK and U.S. officials
work to make the Treaty regime as user-friendly as possible so
that U.S. and UK companies can employ its provisions to greatest
effect and for the maximum benefit of U.S. and UK security and
defence forces in the months and years to come.
BACKGROUND
5. Northrop Grumman is a global defence
and technology company and provides products, services and solutions
in systems integration, defence electronics, information technology,
advanced aircraft, shipbuilding, and space technology. With headquarters
in Los Angeles, California, the company has annual revenues in
excess of $30billion (£15billion) and employs more than 120,000
people in 25 countries serving international military, government
and commercial customers.
6. Northrop Grumman has a long standing
relationship with and presence in the UK dating back more than
20-years. The UK remains a critically important market for the
company as a supplier base and a source for technology partners.
Northrop Grumman's annual spend in the defence and aerospace industry
supports thousands of jobs around the UK generating intellectual
property and facilitating exports.
7. In January 2006, Northrop Grumman consolidated
its UK business development and customer interface activities
establishing a new corporate office in London to best serve its
UK customer base and to grow its business both in the UK and other
international markets. In November 2006, the company created the
UK-registered company entity Northrop Grumman UK Ltd to facilitate
the growth and expansion of Northrop Grumman activities in the
UK defence, security, civil government and commercial sectors.
8. There are more than 700 Northrop Grumman
employees in locations across the UK at Chester, Coventry, Fareham,
London, New Malden, Peterborough, RAF Waddington and Solihull,
providing avionics, communications, electronic warfare systems,
marine navigation systems, C4I and mission planning, robotics,
IT systems and software development. Northrop Grumman has responded
to the challenges set to industry in the December 2005 Defence
Industrial Strategy (DIS) in numerous ways during the past two
years. This has included the investment in new technology facilities:
Chester, providing specialist technical support and repair for
its directed infrared counter-measures (DIRCM) systems installed
on RAF front-line aircraft; Fareham, for the development and demonstration
of command and control technology and systems for military and
civil applications; and Peterborough, providing technical support
and repair for its electronic warfare automatic test equipment.
REMOVING BARRIERS
TO DEFENCE
TRADE AND
TECHNOLOGY TRANSFER
9. Northrop Grumman UK welcomes this Treaty.
It is an important step in strengthening bilateral defence co-operation
between two close allies and defence partners. The treaty would
reduce the barriers to the exchange of defence goods, services
and information-sharing, which will speed response to operational
requirements. The U.S.-UK Defence Trade Cooperation Treaty could
go a long way towards fundamentally reshaping U.S.-UK security
and military collaboration in the coming years.
10. Any agreement should first and foremost
protect what needs to be protected. It is imperative to protect
sensitive technologies and to prevent defence equipment from falling
into the hands of state or non-state actors inimically opposed
to U.S. and UK interests. Discussions on the negotiations of the
Treaty Implementing Arrangements have made it very clear that
the governments are concerned with ensuring that Treaty collaboration
is properly limited to a "trusted community" of U.S.
and the UK companies and individuals and that stringent criminal
penalties will be imposed for any violation.
11. The Treaty is correctly focused on increasing
the capabilities of U.S. and UK forces. It would put bilateral
defence trade definitively on a par with our close intelligence
and nuclear relationships. Where the U.S. and the UK currently
share very sensitive information in the areas of signals intelligence
and nuclear weapons, this relationship would now be extended to
many aspects of the defence industrial relationship. This would
enable real burden-sharing by building stronger, more interoperable
partners. The UK, for instance, has technology and experience
in defeating improvised explosive devices (IEDs) that can assist
in that critical area. U.S. technology, on the other hand, will
help the UK conduct operations in concert with U.S. forces in
the future.
12. Any treaty regime should enable true
collaboration—going in both directions—across the
Atlantic. A partnership between designated U.S. and UK entities,
for example, would create more opportunities for U.S. companies
to work together with our UK partners (as well as with UK branches
of our own companies) to address rapidly some of our toughest
common problems, such as defeating IEDs in Iraq and enabling NATO
operations in Afghanistan. For example, the Treaty will enable
Northrop Grumman to better support programmes such as DIRCM and
the ground forces location and tracking system, Coalition Force
Tracker. These programmes, and many others, could become much
more responsive to the needs of U.S. and UK soldiers in a Treaty
regime. As this makes clear, a Treaty regime will lead to more
innovation and to the development of more effective systems for
both U.S. and UK forces.
RECOMMENDATIONS
13. Northrop Grumman UK strongly recommends
that the UK Government endorses the Defence Trade Cooperation
Treaty.
14. Northrop Grumman UK recommends that
UK and U.S. officials continue to work with U.S. and UK industry
to make the Treaty regime as user-friendly as possible so that
U.S. and UK companies can employ its provisions to greatest effect
for our security and defence forces in the months and years to
come.
15 November 2007
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