ITAR Creates 'Irrational Fears,' Prevents 'Sensible Collaboration,' Expert Says

The State Department’s International Traffic in Arms Regulations need “major reform” if the U.S. wants the Australia-U.K.-U.S. (AUKUS) partnership to succeed, Rajiv Shah, a fellow at the Australian Strategic Policy Institute, wrote Feb 16. AUKUS, which is aimed at allowing the three trade partners to better share sensitive defense technology, is being hindered by the ITAR, Shah said in his ASPI article, which too often “stymie[s] collaboration and innovation between allies” and provides “no obvious reduction in security risk.”

The U.S., Australian and U.K. governments should create an open export license that “covers all the technology areas contemplated in the AUKUS agreement,” Shah argued, which would be a “major boost to being able to actually realize the agreement’s strategic intent.” Rep. Mike Gallagher, R-Wis., said last month he is working on a bill to revise certain aspects of the ITAR, adding that the AUKUS partnership has a “lot of opportunities” that the U.S. hasn’t realized due to ITAR barriers (see 2301270005).

Shah said the ITAR’s scope is “incredibly broad,” and “specific approval is required for every [controlled] export to every country.” When Shah’s team was working on a joint U.K.-U.S. research project and presented its work at a U.S. symposium, he said he was “somewhat shocked” when U.S. contractors“walked out of the room, and then came back in as soon as” the presentation ended.

“It turned out this wasn’t due to some mysterious brand of corporate politics, but because their lawyer had advised them that, due to ITAR, they couldn’t participate in a joint conference with U.K. personnel,” Shah wrote. “I’m still not sure why someone thought that simply listening to a presentation from a UK national constituted an export of US information to the UK, but it definitely shows how ITAR can create irrational fears that prevent sensible collaboration.”

Shah said his “experiences are far from unusual,” and it’s “clear that the broad scope of ITAR, as currently written, coupled with a draconian enforcement approach, is creating both real and perceived barriers to effective collaboration.” Although the State Department recently introduced an open general license pilot designed to more efficiently authorize certain defense activities with Australia, Canada and the U.K., the pilot only covers reexports and retransfers (see 2207190008). The agency said it may consider expanding the program to exports (see 2301240029).

“The one-size-fits-all rules of ITAR don’t work in today’s strategic environment,” Shah said. “Regulations to control sharing of information must recognize there are also risks in not sharing information, through lost opportunities. This means the approach needs to be customized based on the country with which information is being shared and the technology domain involved.”

A State Department spokesperson on Feb. 17 said the agency takes "issue" with Shah's point that the ITAR "somehow poses an undue burden on defense cooperation." The U.S.' "approach to defense export controls is essential" to maintaining its defensive advantage and allowing U.S. companies to innovate.

"We would note that U.S. companies continue to successfully provide innovative products to meet U.S., our allies, and our partner’s defense needs while complying with the ITAR," the spokesperson said. "We would further note that Australia and the U.K., as two of our closest defense trade partners, are provided significant efficiencies under the U.S. export control framework."

The agency continues to work with both the Australia and U.K. "to meet the goals of AUKUS, while maintaining strong export controls to ensure appropriate safeguards on key military technologies essential to protecting our shared foreign policy interests and robust defense industrial base."