March 8, 2013 / 8:00 PM / 7 years ago

Obama pushes ahead with export control changes

WASHINGTON (Reuters) - The Obama administration has notified Congress of plans to modify U.S. weapon and ammunition export controls to make it easier for American companies to export spare parts for aircraft and gas turbine engines, the White House said on Friday.

U.S. President Barack Obama arrives at the Walter Reed hospital in Bethesda, Maryland, March 5, 2013, to meet with wounded soldiers. REUTERS/Jason Reed

President Barack Obama also issued an executive order changing how export controls on military and certain high-technology goods are administered, the latest step in a reform initiative that dates back to August 2009.

“This is the beginning of putting in place the nation’s new export control system,” a senior administration official told reporters on condition he not be identified. “Our current export control system is very complicated ... It’s designed to address the Cold War-era and hasn’t been updated since that time.”

The changes are aimed at simplifying export licensing requirements for less sensitive items and building better protections for the most critical technologies, administration officials said.

They would provide a streamlined export authorization process for thousands of parts and components used in aircraft and gas turbine engines, two of 21 categories on the U.S. Munitions List, the officials said.

Currently, everything on the U.S. Munitions List “is controlled equally, whether an F-18 fighter or a bolt that has been modified for use on that F-18, and each of these items requires an individual license,” the White House said.

The new rules go into effect in 180 days of being published, unless Congress, which was notified of the changes on Thursday, moves to block them in the next 30 days.

“The new system will help our defense companies compete more effectively abroad while creating more jobs here at home,” said Representative Adam Smith, the top Democrat on the House of Representatives Armed Services Committee.

Items such as assembled engines, bomb racks, missile launchers, fire-control computers, radars and weapons pylons will stay on the Munitions List, a senior administration official told reporters.

Former Secretary of Defense Robert Gates in April 2010 outlined the administration’s long-term plan to merge two separate government lists that govern exports of weaponry and dual-use technology goods into a single list.

“We need a system that dispenses with the 95 percent of ‘easy’ cases and lets us concentrate our resources on the remaining 5 percent,” Gates said at the time.

The Commerce Department currently issues export licenses for dual-use goods and technology with both civilian and military applications.

The State Department administers the U.S. Munitions List, which contains 21 categories ranging from firearms and tanks to satellites and nuclear weapons design and test equipment.

“Rebuilding our export control lists and moving less sensitive items from the State to the Commerce list will provide us the flexibility to more efficiently equip and maintain our partner’s capabilities while allowing us to focus on preventing potential adversaries from acquiring military items that they could use against us,” the White House said on Friday.

U.S. manufacturers have complained that restrictions on less sensitive technologies have cost them billions of dollars in lost sales that have gone to foreign suppliers.

A study by the Milken Institute for the National Association of Manufacturers a few years ago estimated that modernizing export controls could boost real U.S. economic output by $64 billion and create 160,000 manufacturing jobs.

Close U.S. allies have also complained that Washington’s system makes it difficult for them to get spare parts for equipment they have bought from the United States.

Reporting By Doug Palmer; Editing by Paul Simao

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