U.S. unveils more export control changes, for military electronics

WASHINGTON Mon Jun 30, 2014 4:40pm EDT

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WASHINGTON (Reuters) - The U.S. government on Monday published another big batch of changes to export control laws affecting military electronics, and said it was on track to finish reviewing remaining categories for possible streamlining by the end of the year.

Ken Handelman, deputy assistant secretary of state for defense controls, said the latest changes would shift some less sensitive military electronics and components from the State Department's U.S. Munitions List to the Commerce Department's list of commercial items, easing exports of those items while maintaining strict controls on more sensitive technologies.

The changes are part of a major drive to reform U.S. export control laws that was launched by President Barack Obama in August 2009. Changes have already been announced for satellites and aircraft, among others.

Military electronics are the second largest category released so far, measured by number of applications handled by the State Department, Handelman said. He said reviews of remaining categories, including cloud computing, would be completed by the end of the year.

Handelman told Reuters in an interview this month that the Obama administration's review of Category XI military electronics was particularly difficult since such items comprise "the heart and soul of what gives the U.S. military its edge."

In the end, he said administration officials agreed to shift a "huge amount of stuff" from the State Department's weapons list to the Commerce Department list, easing exports of those items, especially to NATO countries and other close U.S. allies.

Handelman said the drive was aimed at reducing ambiguity for companies about which items required export licenses and which did not. The changes take effect Dec. 30.

"The rule itself is now much more precise," he said. He said the changes should allow companies to better track and predict which items most concerned national security officials, he said.

For instance, specific bandwidths were established for weather radars that had previously not been so clearly defined.

U.S. companies have generally welcomed the government's export control efforts, but are pressing for quicker action on some items not yet addressed, including unmanned planes and items associated with commercial spaceflight.

Compliance with the changes has also resulted in a huge amount of work for big weapons makers like Lockheed Martin Corp , Raytheon Co and Sikorsky Aircraft, a unit of United Technologies Corp, which must reclassify hundreds of parts used in different weapons systems.

Handelman said the State Department had received some critical comments about the reform effort from industry and other groups, but the "vast middle is generally positive."

He said the changes were aimed at improving security, enhancing cooperation and joint operations with close allies, and helping U.S. companies by reducing incentives for foreign buyers to deliberately avoid U.S.-origin parts and components.

Items were left on the U.S. Munitions List if they were found to be inherently military, or had characteristics that gave the United States a critical military or intelligence advantage, and were almost exclusively available from the United States.

(Reporting by Andrea Shalal; Editing by Chris Reese)

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