international acquisition & exportability fundamentals

International Acquisition & Exportability

Fundamentals

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TSFD

FMS DCSICP

Are These Acronyms Familiar?

DEF

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Overview

DefenseExportability

Sales & Transfers

Technology Security &

Foreign Disclosure

InternationalCooperative Programs

International Acquisition & Exportability (IA&E)

• Environment• Int’l Acquisition Forms and

Mechanisms• Technology Security &

Foreign Disclosure• Defense Exportability• Changing the Culture

Topics

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The Environment

ExportControlReform

SecurityCooperation

ProgramProtectionPlanning

DefenseExportability

Features

JCIDSInternationalProvisions

DefenseAcquisition

Policy

IndustryForeign Sales

GlobalIndustrial

Base

IncreasingDAW

Involvement

GlobalTechnology/

Products

Environment demands we change the way we train international acquisition professionals

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Defense Exportability Integration

Sales & Transfers

Technology Security & Foreign Disclosure

InternationalCooperative

Programs

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ICPs Vs. Defense Sales

ICPs (Partnerships)

More FlexibleBilateral or MultilateralForeign Gov’t is PartnerJoint RequirementBoth Gov’ts Are End UsersBoth Gov’ts FundTerms are NegotiableBoth Participate in OversightCost of Services are SharedUSD(AT&L) Oversees (Title 10)

DEFENSE SALES

(Buyers-Sellers) More Structured

Bilateral Arrangement

Foreign Gov’t is Customer

Foreign Gov’t Requirement

Foreign Gov’t End User

Foreign Gov’t FundsU.S. Sets Terms (LOA)U.S. Controls ImplementationForeign Gov’t Pays for Services

USD(P) Oversees (Title 22)

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Sales & Transfers



Programs

UNCLASSIFIED

FMS and Service Procurement: 5 Year Average, FY10-14

The Scale of FMS

Air Force

FMSNavy

Army

#1. $45.1 Billion Navy (incl. USMC)

#2. $39.0 Billion FMS

#3 $38.8 Billion Air Force

#4 $32.4 Billion Army

Benefits to the U.S.• Builds U.S.-partner

relationships

• Interoperability

• Lowers unit costs for the U.S. DoD

• Maintain production lines

• Dollars into the U.S. economy

• Jobs8

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FMS vs DCS vs Hybrid

• DoD is generally neutral whether a foreign country purchases through FMS or DCS

• Certain items can be designated FMS only; based on complexity, sensitivity, interoperability, relationships

• Most major system DCS programs will have an FMS companion effort for FMS-only items (i.e. a hybrid program)

Many EW system international sales are“hybrid programs” due to classified aspects

of system software functionality

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Program Trends

Past Present

Foreign Military Sales (FMS)

Direct Commercial Sales

International Cooperative Programs (ICPs)

Sale of DoD Configurationwith Exportability Modifications

Integration of BuyerFurnished Equipment (BFE)

Development and Integrationof New Equipment

Sale of DoD Configurationwith Exportability Modifications DCS/FMS Hybrid Programs Sale of New or Highly

Modified Systems

Cooperative Development ofNew Systems

Incorporating ForeignParticipation in DoD Program

Cooperation ThroughoutPrograms’ Life-Cycles

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Sales & Transfers



Programs

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The Dilemma

How can the USG/DOD best balance these two competing demands?

Provide required capabilities

quickly to allies and friends

Protect the “crown jewels” of U.S. defense

technology

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TSFD and Export Control Basics

Fundamental Security Considerations

Release Conditions

Type of Authorizations

TSFD DisclosureAuthorizations

ExportControl

• Not transfer or use for other purposes without U.S. consent• Provide substantially the same degree of protection as U.S.

Access Protection+

DoDIntel Community

Interagency

State & CommerceDoD

Interagency

DoDInteragency

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USG/DoD TSFD ProcessesMILDEP Processes

DoD Lead: Various

MILDEP-specific various

MILDEP Process

Other DoD Processes

DoD Lead: Various

Org.-specific various

Few documented processes

Interagency process

LO/CLO AT&L Primary

AT AT&L Primary

SAP SAPCO Specialized

DSC AT&L + Policy Specialized

Intel USD(I) Specialized

Data Links/WF DoD CIO Specialized

PNT/GPS DoD CIO Specialized

COMSEC NSA & DoD CIO Primary

GEOINT NGA Specialized

MTCR Policy Specialized

NDP Policy Primary

EW None No single process

NVD/INS DTSA Specialized

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Sales & Transfers



Programs

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Designing for Exportability

• Launch customer paid for technology security modifications to DoD configuration

• Expensive and time consuming mods inhibit foreign sales• No authority to use appropriated funds for exportability design

Past

• Defense Exportability Features (DEF) Pilot Program authorized by Congress in FY11 and subsequent Nat’l Defense Authorization Acts

• OSD and the MILDEPs have selected 15 programs to participate as DEF Pilot Programs

• Authorizes expenditure of DoD funds to evaluate exportability and facilitate planning; industry shares cost

• Facilitates incorporation of program protection features in systems with high export potential during system development

Present

• Improves protection of Critical Program Information (CPI) and critical functions using Anti-Tamper (AT)/Cyber measures

• Reduces overall DoD and foreign program protection costs• Makes our equipment available earlier to Allies and Friends

Why

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Int’l Acquisition TransactionsLooking Forward -- Macro View

USStrategy & Policy

Foreign Strategy & Policy

Capabilities & Tech

Willing to Transfer

Desired Capabilities

& Tech

Inquiry, Partnership

Discussion or Request for Purchase

?

FMS

DCS

ICP

Other

TSFD Export Control

Int’lAcquisition

Transactions

Defense

InitialTSFD& DEF

Add

EngageEarlier Acquisition System

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Changing the International Acquisition Culture

Conventional• Separate ICP, FMS, DCS

business planning• Sequential, stove-piped

transaction mechanisms• Reactive TSFD and

export control policy development• Exportability mods to

U.S. design by launch partners/customers

IA&E• Integrated international

business planning• Multiple, parallel

transaction mechanisms• Early TSFD and export

control policy engagement• Design for exportability

throughout the acquisition life cycle

Improved Outcomes for DoD, Allies, and Friends!

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Back Up Charts

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Security Cooperation Elements

CombinedExercises

Equipment Sales

& FinancingDefense

Contacts &Familiarization

Int’l Armaments Cooperation

Support to Operations

HumanitarianEfforts & Civic

Assistance

Int’lTraining & Education

Elements that involve defense acquisition

in color

DoDD 5132.03 October 2008

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International Cooperative Programs (ICPs)

Scope• DoD concludes about ~30

international agreements/year for ICPs

• Most agreements are for S&T or early R&D projects

• Some agreements for cooperation on a “piece” of a program

• Limited number of fully cooperative major system development/production programs

Major System Examples• F-35 Joint Strike Fighter (JSF)• NATO Alliance Ground

Surveillance (AGS)• Rolling Airframe Missile (RAM) • Evolved SeaSparrow Missile

(ESSM)• Multifunctional Information

Distribution System (MIDS)• Guided Multiple Launch Rocket

System (GMLRS)• Wideband Global SATCOM

(WGS)

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Security Assistance Programs

Program Administration Responsibilities

Department of Defense• Foreign Military Sales (FMS)• Foreign Military Financing Program (FMFP)• Int’l Military Education & Training (IMET)• Foreign Military Construction Services

(FMCS)• Leases• Drawdowns• Excess Defense Articles (EDA)

Department of State• Peacekeeping Operations• Int’l Narcotics Control & Law Enforcement• Nonproliferation, Antiterrorism, Demining,

and Related (NADR) • Direct Commercial Sales (DCS)

US Agency for Int’l Development• Economic Support Fund (ESF)

Security Assistance is a State Department-led

effort primarily implemented by DoD

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Building Partner Capacity (BPC)

• Title 10, DoD Security Cooperation programs executed through the FMS infrastructure• Differences from traditional FMS

– USG Requesting Authority identifies requirement– Funded by the USG– “Pseudo”-LOAs are not signed by country– Title transfers in country

• Variety of programs conducted under multiple legal authorities

List of BPC policies & programs are contained in Chapter 15 of DoD’s Security Assistance Management Manual (SAMM)

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USG/DoD TSFD ProcessesMILDEP Processes

DoD Lead: Various

MILDEP-specific various

MILDEP Process

Other DoD Processes

DoD Lead: Various

Org.-specific various

Few documented processes

Interagency process

LO/CLO AT&L Primary

AT AT&L Primary

SAP SAPCO Specialized

DSC AT&L + Policy Specialized

Intel USD(I) Specialized

Data Links/WF DoD CIO Specialized

PNT/GPS DoD CIO Specialized

COMSEC NSA & DoD CIO Primary

GEOINT NGA Specialized

MTCR Policy Specialized

NDP Policy Primary

EW None No single process

NVD/INS DTSA Specialized

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DoDD 5111.21, “ATTR SSG and TSFDO” (New October 2014)

OSD TSFD Initiative

• Arms Transfer and Technology Release (ATTR) Senior Steering Group (SSG) created in 2008 and formally established in 2012:– Overarching DoD authority to ensure clear senior-level

direction; USD(P) & USD(AT&L) co-chairs – Serves as appeals board and mediation body

• TSFD Office (TSFDO) supports ATTR SSG efforts:– ATTR SSG Executive Secretariat and assesses/recommends

changes to policies– Develops/implements procedures and checklists,

coordinates documentation and policy, conducts outreach

international acquisition & exportability fundamentals

Documents