Memorandum from the Aerospace Industries
Association
I write on behalf of the 275 member companies
of the Aerospace Industries Association of America (ALA). Our
association is the premier trade association in the United States
representing major aerospace and defense manufacturers. ALA is
pleased to support the signature and implementation of the Defense
Trade Cooperation Treaty between the United Kingdom and the United
States. We believe the treaty is an important step in strengthening
bilateral defence cooperation between our two countries.
Please find enclosed the formal prepared testimony
(Annex) of Dr Jerry McGinn to the House of Commons Defence Committee
hearing on Treaty scheduled for 21 November. Dr McGinn is the
Chairman of AlA's U.S.-UK Defense Treaty Working Group and currently
serves as Director of U.S.-UK International Traffic in Arms Regulations
(ITAR) Policy for Northrop Grumman Corporation.
We hope that Dr. McGinn's testimony will facilitate
the completion of the Defence Committee's inquiry into the Treaty.
19 November 2007
Annex
Testimony to the House of Commons Defence
Committee Dr John G (Jerry) McGinn, Northrop Grumman Corporation
Chair, AIA U.S.-UK Defense Treaty Working Group 21 November 2007
Good morning. My name is Dr Jerry McGinn. I
am a U.S.-based executive with Northrop Grumman Corporation and
I am pleased to appear before you today as the designated representative
of the Aerospace Industries Association of America (AIA). On behalf
of the member companies of AIA, I am pleased to express U.S. industry's
support for the signature and implementation of the Defense Trade
Cooperation Treaty between the Governments of the United Kingdom
and the United States. This Treaty is an important step in strengthening
bilateral defense co-operation between two extremely close allies
and defense partners. The Treaty would reduce the barriers to
the exchange of defense goods, services and information-sharing,
which will speed response to operational requirements. In short,
the Treaty could go a long way towards fundamentally reshaping
bilateral military collaboration in the coming years.
The partnership between the United States and
the United Kingdom will always occupy an important and unique
strategic role as we confront together the security challenges
of today and tomorrow. This "special relationship" is
central to stated U.S. national security objectives as articulated
in the U.S. National Security Strategy and the 2006 Quadrennial
Defense Review and in UK strategy documents.
U.S. and UK forces are operating together in
Iraq, Afghanistan, and many other theaters, and it is essential
that they operate together seamlessly. Commanders in the field
require export control systems that facilitate cooperation at
the tactical level. On a more strategic basis, both of our countries
have, and will continue to have, an enduring need for effective
and efficient technology sharing to better support our war-fighters
with the best technology for the best price. Such cooperation
also ensures a secure environment for strategic industrial partnerships
that support the competitiveness of the industrial base of both
of our countries.
The United Kingdom and the United States have
a long tradition of sharing extremely sensitive information in
areas such as nuclear weapons, intelligence, operations, and technology
development. This collaboration has extended from the Manhattan
Project and the development of anti-aircraft radars in the Second
World War to the current Trident submarine program and the sharing
of imagery and signals intelligence in Iraq and Afghanistan. The
Treaty would apply a similar collaborative environment to arguably
less sensitive defense articles and services.
The Treaty signals the fundamental recognition
in the U.S. government that the U.S. export control system must
be more predictable, efficient, and transparent in order to enhance
U.S. national security. UK export licenses are almost universally
approved, but the process is cumbersome and certainly not reflective
of the close bilateral relationship. In 2005 and 2006, for example,
U.S. companies submitted 13,000 license applications for defense
articles destined for the United Kingdom. 84% of these applications
were for unclassified items. 99.9% of all these applications were
eventually approved after weeks and months of processing. We have
underscored with our government the need to conform our export
controls to the nature of the bilateral relationship. In addition,
the Treaty structure would enable the United States Government
to better focus on the prevention of sensitive exports to potential
adversaries by reducing the State Department export license caseload.
An important breakthrough here is the application
of the Official Secrets Act in the context of the Treaty. By doing
so, the Treaty establishes strong protections against improper
diversion of U.S. and UK technology. The provisions of the Treaty
creating approved communities of companies, restriction of Treaty
treatment to approved programs and end uses relating to U.S. and
UK defense, and strict record-keeping and auditing requirements
also will play critical roles in safeguarding sensitive technology.
U.S. industry is encouraged by the progress
to date on developing the Treaty's implementing arrangements.
We have had numerous interactions with U.S and UK officials about
the Treaty and its implementing arrangements and it is clear that
the Governments desire to make the Treaty as practical and usable
as possible. To that end, we believe it is critical to develop
clearly understood and appropriate rules and requirements to achieve
the Treaty's objectives, particularly in areas such as research
and development, technology exclusions and compliance requirements.
This will enable U.S. and UK companies to employ the Treaty provisions
to great effect for the benefit of our militaries in the months
and years to come. We understand that traditional licensing systems
will always be open to us, but we are committed to the development
of a Treaty that represents a more predictable, efficient, and
transparent alternative for governing technology exchange.
Assuming that the Treaty is approved by Parliament
and ratified by the U.S. Senate, we foresee a number of positive
changes for both of our countries. There will no longer be a need
for an export license for the transfer of most defense articles
and services (hardware, technical data, defense services, etc)
between the U.S. and the UK approved communities. This Treaty
regime will 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 rapidly address some of our most persistent
operational challenges such as IED defeat and counter-terrorism.
The Treaty will also reduce requirements that delay the deployment
of systems and related parts and components to our warfighters.
As this makes clear, a Treaty regime will lead to more innovation
and to the development of more effective systems for both US and
UK forces.
In summary, the U.S. defense industry is strongly
supportive of the Treaty and its potential contributions to our
national security. AIA's US-UK Treaty Working Group will continue
to remain engaged with the U.S. government on this important national
security priority and we are keen for its favorable consideration
and implementation in both countries in the coming months. We
very much look forward to your Committee's report and thank you
very much for the opportunity to present a US perspective on the
Treaty.
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