Further memorandum from the Foreign and
Commonwealth Office
SECTION A: QUESTIONS
RELATING TO
SEVERAL LICENSING
DECISIONS (QUARTER
3 (2007))
1. 26 OIELS were issues in the quarter. Why
has the number dropped? Is it still the case that OIELs are generally
valid for two or three years?
The most important factor in the number of OlELs
issued is the number applied for, and this is determined by industry
needs. The Government then reacts to applications as they are
lodged. Each application is then assessed on an individual basis
against the Consolidated Criteria, and if an exporter cannot demonstrate
a good track record and a clear business case for an OIEL, then
it will be rejected and the exporter advised to apply for SIELs.
OIELs are now generally valid for a period of
5 years, although this does depend on business need, and does
not apply to Dealer to Dealer OIELs (which remain limited to three
years). The move to five-year OIELs may have caused a temporary
dip in applications for renewals. This is because, for example,
three-year OIELs which were issued in 2004 would previously have
been subject to application for renewal in 2007, but many will
now not be due for renewal until 2009. This could account for
some of the reduction but it will only be a temporary effect and
we might expect a corresponding increase in the number of licences
processed in future.
2. It would assist the Committee to have a
note explaining the difference between items which are recorded
as SIELs for components, for example, for aircraft radars to France
and SIELS (incorporation) components for aircraft radars to France
Applications are categorised as incorporation
where the exporter has indicated that the items will be incorporated
into an item which will then be re-exported to a 3rd country.
Items are categorised as components when they
are to remain in the country to which they are exported.
SECTION B: SPECIFIC
LICENSING DECISIONS
(QUARTER 3 (2007))
3. The Committees would be grateful for more
information on the following licences issues during the second
quarter (July to September) of 2007:
(a) Angola: OIEL no 1. Was this OIEL subject
to an assessment against criterions 8 by DFID? What is the estimated
value of the goods that may be exported under this licence?
DFID did see this application, but did not carry
out a Criterion 8 assessment as the supply of the items on this
OIEL would not have been to the Angolan Government, and so the
question of prejudicing Angola's sustainable development did not
arise.
As OIELs usually permit the export of a range
of goods without specifying quantity or value, the Government
does not ask the exporter to provide a value when applying for
an OIEL.
* * *
t. Solomon Islands: Were the SIELs subject to
an assessment against criterion 8 by DFID? If it was could the
Committee see the assessment?
This SIEL was not subject to a DFID assessment
as the items were not being purchased by the Government.
* * *
SECTION D: QUESTIONS
RELATING TO
THE GOVERNMENT'S
RESPONSE TO
THE QUADRIPARTITE
COMMITTEE'S
LAST REPORT
AND LETTER
OF 15 JANUARY
2008
5. Recommendation 22: When will
the Government's consideration of the new methodology be completed?
We have reviewed the Criterion 8 methodology
and made some amendments to it. The new methodology is now in
use.
6. Recommendation 38: What is the
timetable for the preparation of the plan?
Subsequent to a meeting with representatives
of the academic sector in November 2007, the FCO prepared an awareness
plan, a copy of which is included (for the Committee's use only).
The principal activity to date has been to identify an opportunity
of working with the FCO to use the recently introduced compulsory
Academic Technology Approval Scheme (ATAS) to make academic institutions
aware of the potential need for an export licence for WMD related
technology transfer. ATAS requires non-EU/EEA nationals planning
to undertake postgraduate study in the UK in certain science,
engineering or technology disciplines to obtain clearance from
the FCO before applying for a Visa, Entry Clearance or Extension
of Stay. However, the need for an export licence is not covered
by the ATAS process. So we propose to include an export control
awareness paragraph in the information sent out to institutions
listing the individuals who have been granted certificates.
7. Recommendation 51: When will
the questionnaire be returned and the results available
The Government has received a number of responses
from other EU Member States, and is in the process of compiling
the responses. Once this has been completed, a consolidated response
will be sent to COARM for passing on to member states. At the
same time we will pass a copy to the Committee
8. Recommendation 67: Can the FCO
please press the Home Office for the information sought?
The FCO will press the Home Office for a response
to this recommendation and get back to the Committee shortly.
9. Recommendation 71: When will
the Presidency's proposals emerge?
Discussion on the Commission's proposals for
a revision of the Council Regulation on the control of exports
of dual-use items takes place at official level in the Presidency-chaired
Dual-Use Working Party. The UK has contributed positively to these
discussions and seeks to disseminate UK best practice and experience
where this is appropriate. Member states have yet to agree formally
on any of the proposals, and discussions continue.
10. Recommendation 86: Will the
Government's commitment include the provision of figures in the
2007 Annual Report?
Information on resourcing will be included in
the 2007 report. However, this will be in terms of overall resourcing
and not monetary value.
11. Recommendation 88: The Committee
welcomes the Government's suggested change in its letter of 15
January 2008.
Noted
SECTION E: REVIEW
OF THE
EXPORT CONTROL
LEGISLATION (2007): GOVERNMENT'S
INITIAL RESPONSE
TO THE
PUBLIC CONSULTATION
(FEBRUARY 2008)
12. What evidence emerged from the consultation
exercise about the reasons for the small number of applications
for trade control licences from British Citizens overseas?
13. What evidence emerged from the consultation
exercise to show whether the extra-territorial provisions in the
legislation have places British citizens overseas in unacceptable
positions?
12 & 13: The Government published on the
ECO website all the responses that it received and they can be
viewed at: http://www.berr.gov.uk/europeandtrade/strategic-export-control/legislation/export"control-act-2002/review/page42883.html
14. Has the government made a final decision
on the registration of brokers?
No. The initial response in the ECA Review covers
this area at paragraph 8.1.
15. Has the Government considered the Committee's
recommendation that a standard requirement of licensing be to
include a requirement that export contracts for goods on the Military
list contain a clause preventing re-export to a destination subject
to UN or EU embargo?
This is still being considered, and will be
covered in a further response.
16. Recommendation 69: The Committees
wish to know whether the Government has completed its consideration
of the implications for the review of EU Council Regulation 1334/2000
and whether there are implications for domestic legislation?
The Government has concluded that there are
no implications for domestic legislation arising from the review
of the implementation of the EU Regulation. Examination of the
Commission's proposals for amending Council Regulation 1334/2000
is on-going in Council Working Groups. It is hoped that this process
will be complete by the end of 2008.
17. Will the 2006 Annual Report include monetary
values in the information about resources on enforcement and outreach?
Please see the answer to Q10.
SECTION F: OTHER
QUESTIONS
18. The Committee notes the written answer
given on 22 January 2008 that "particular attention"
was being taken "when issuing licences where there was a
risk that equipment might be diverted to Burma from third countries"
(HC Deb 22 January 2008 col 1850W). Has the Government refused
any applications for export licences for this reason? If so please
supply details.
The Government has not refused any export licence
applications on the grounds of possible diversion of the goods
to Burma.
19. Has the UK/US Defence Trade Co-operation
Treaty been ratified by the US Senate? What are the prospects
for ratification?
The Defence Trade Cooperation Treaty will simplify
and make more effective the controls on transfers of defence material
between the US and the UK. Negotiations on the Treaty Implementing
Arrangements are now complete and we are confident that the US
Senate will ratify the Treaty in the near future. Clearly there
is still a chance ratification will not take place and in this
instance the Treaty would not come into force. UK export controls
will not be affected by the Treaty.
20. What is the UK Government's view of the
proposal that the emerging international treaty, currently being
discussed within the Oslo process, should only prohibit cluster
munitions that do not have self-destruct mechanisms or that do
not meet a fixed maximum percentage of failure, such as 1 %. Does
the Government support such a proposal?
The aim of the Oslo Process, as expressed in
the February 2007 Oslo Declaration, is to conclude a legally binding
international instrument that will prohibit cluster munitions
that cause unacceptable harm to civilians. One of the key tasks
at the final Oslo Process meeting in Dublin (19-30 May) will be
to define what types of cluster munitions might be prohibited
by the Convention. It is the harm to civilians caused by unexploded
ordnance from cluster munitions that we are all seeking to address.
Extensive discussions have taken place in previous
Oslo Process meetings, including on the impact and reliability
of self-destruct mechanisms, but no consensus has yet been reached.
The UK has tabled its own proposal for what types of cluster munition
might be prohibited or excluded by the Convention. We believe
that self-destruct mechanisms can minimize the post-conflict risk
posed by cluster munitions to civilians. We have therefore suggested
that we need to consider the elements and characteristics that
should exempt a sub-munition from a prohibition within specified
reliability and accuracy benchmarks, including munitions which
incorporate a failsafe mechanism.
21. According to "M85: An analysis of
reliability" (Norwegian People's Aid 2007) the M85 is currently
considered as the `benchmark' among bomblets equipped with self-destruct
mechanisms and that the M85 is the only self-destruct bomblet
ever documented to have been used in combat: in 2003 by the UK,
and in 2006 by Israel in Lebanon. What assessment has the UK Government
made of the use of the M85 and of the failure rate of its self-destruct
mechanism.
As with all reports received on munitions, we
welcome the opportunity for our experts to read and evaluate this
report. The evidence in the report on UK use of L20A1 M85 in Iraq
in 2003 is anecdotal and inconclusive. Assertions that the M85
has a higher failure rate in combat than in testing are not borne
out by UK operational experience in Iraq. The sub-munition was
deemed highly effective by UK Commanders. Moreover, rigorous UK
trials, testing and in-service surveillance since 1996 have indicated
that the M85 has a 2% failure rate.
However, we accept that sub-munitions may perform
differently when used by different nations in different operational
conditions. Munition age, condition of storage, temperature, handling
and transportation can affect the reliability of all munitions,
including cluster munitions. UK munitions authorities are well
aware of these factors and conduct a series of in-service trials
and tests to mitigate against them. The various sub-components
of the munition are broken down into their constituent parts,
and are subject to a rigorous and thorough physical, chemical
and visual examination. Routine trial-firings are also carried
out at a range of temperatures to simulate environmental variances.
As the overall aim of those seeking a treaty
on cluster munitions is to reduce the risk of unintended harm
from explosive remnants of war, then fail-safe fuses should be
seen as making a positive contribution towards that aim. We do
accept that certain older mechanical self-destruct fuses may be
less reliable than more modern versions, but there is nothing
to suggest that future designs could not be significantly more
reliable. New technology, including electrical fusing, will increase
the reliability of the munitions further and reduce the incidence
of explosive remnants of war.
22. What proposals has the EC brought forward
to reduce the scope of Article 296 of the Treaty of Amsterdam,
at what stage are the proposals and what is the attitude of the
UK Government?
On 5 December 2007 the Commission published
a Defence package which included 2 draft legislative measures—one
on Defence and Security Procurement Rules and one on lntra-Community
Transfer of Defence Goods and Services. The package is intended
to improve the efficiency and competitiveness of the European
defence industry by addressing the conduct of business and the
effectiveness of the market.
The objective for the Defence and Security Procurement
Directive, where MoD lead, is to establish new, more flexible
public procurement rules specifically adapted to the defence sector.
This will not only ease the conduct of business in this area but,
it is hoped, will encourage some Member States away from invoking
Article 296 of the Treaty to exempt their procurements from the
public procurement rules due to the inadequacies of the current
rules. The Government supports the Commission's aims of improving
competitiveness, transparency and efficiency in the European defence
equipment market although the proposed measure clearly needs to
be carefully balanced with the need to ensure adequate protection
of legitimate national security concerns.
Separately, the Intra-Community Transfers Directive
aims to simplify national export licensing procedures, so as to
facilitate cross-border trade within the EU and thereby improve
competitiveness and security of supply. The Directive generally
proposes to use as its basis the simplified licensing arrangements
that are in operation within the UK.
Neither of the draft Directives would, per se,
reduce the scope of Article 296 or extend the Community's competence,
including that in relation to trade in military goods. However,
they might encourage the Commission to challenge Member States'
use of Article 296 to, for example, justify bilateral treaties
in this area. Given the impact this could have on our ongoing
efforts to ease the conduct of defence trade with non-EU nations,
the Government will pay special attention to this aspect during
the Council Working Groups (the first of which is currently scheduled
for 14 April). Where there are essential security interests at
stake, Member States will remain able to invoke Art 296. If a
Member State can properly do so now, the Directives will not affect
the position at all. The issue is not that the Directives will
change the legal position on external competence but rather that
they will make the Commission more likely to challenge inappropriate
use of Art 296 or that they will contribute to changing the Commission's
view of what constitutes inappropriate use. We will be pressing
for inclusion of text making specific reference to Art 296, but
if the Directive is adopted this will be of symbolic rather than
legal significance.
23. It has been reported that in response to
a July 2007 Government Accountability Office report critical of
the Department of Defence's record keeping, the US Congress has
passed legislation mandating new tracking requirements for defence
articles provided to Iraq. The legislation requires the establishment
of a registration and monitoring system on defence articles provided
to the Iraqi government or any group, organisation, citizen or
resident of the country (http://www.armscontrol.org/act01
-02/mandates.asp?print). The system would require registration
of all small arms, a program of end-use monitoring of all lethal
defence articles, and detailed origin, shipping and distribution
records of defence articles for security forces or security assistance
programs. Has the UK Government considered introducing a similar
system?
The Government had not previously seen this
information and thanks the committee. It is unlikely that the
Government will consider introducing such a system as it already
receives a significant amount of information in relation to export
licence applications, including supporting documentation such
as end-user undertakings. As regards end-use monitoring, the Government
is not in a position to carry out systematic post-export monitoring
checks which, in any event, we do not believe to be a reliable
method of control. A full end-use risk assessment is carried out
when the application for an export licence is being processed.
In the case of Iraq, where not explicitly exempt,
UNSCR 1546 additionally requires certification from the Iraqi
Government or the Multi-National Force assisting it, that the
goods are necessary for the purposes of giving effect to UNSCR
1546 and are therefore exempt from the embargo on Iraq.
24. In paragraph 9 of the annex to the FCO's
letter of 11 October 2007 the Government refuses to further details
because "The information is commercially confidential".
Given that the Government regularly supplies the committee with
material that is "Restricted Commercial" and which classification
the Committee has always respected, the Committee asks why the
information being sought is withheld and that the Government reconsiders
the Committee's request? The Committee is also conscious of the
Government's undertaking in its response to the Committees' later
report that it "would be willing to share with the Committee
on a confidential basis more details of individual assessments,
where requested".
The Government makes every effort to ensure
that classification of material provided to the committee is consistent
and appropriate. The data that is provided on the discs is classified
as "Restricted-Commercial" and is shared with the committee
in confidence. The committee's respect for this is noted. Correspondence
between officials and Ministers is often classified as "Confidential"
or higher for valid security reasons, and we are not able to share
this information with the committee. The Government's offer to
brief the Quad regarding confidential material remains in place.
25. What is the Government's target date for
the publication of the 2007 Annual Report on Strategic Export
Controls?
The Government hopes to publish the Annual Report
on Strategic Export Controls in May 2008.
April 2008
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