State Dept. Will Consider Expanding AUKUS Exemptions, Official Says

Deputy Secretary of State Kurt Campbell told a congressional panel Sept. 18 that he will look into the possibility of expanding the export control exemptions that the State Department intends to grant to Australia and the U.K. under the AUKUS security partnership.

Campbell made his pledge in response to House Foreign Affairs Committee Chairman Michael McCaul, R-Texas, who repeated his concern that too many technologies are excluded from the planned exemptions. As currently formulated, the exemptions fail to reflect congressional intent and risk hampering cooperation among the allies, McCaul asserted.

“Sincerely, I appreciate these comments and I’m going to take those views back” to the State Department, Campbell testified. "You're absolutely right -- if we made this decision to work in the strongest possible partnership with our two closest allies in many respects, Great Britain and Australia, we’re going to have to make those adjustments. It will be challenging but we’re going to have to make those adjustments. We need to make this usable for defense planners and others that are making billion-dollar investments."

Later in the hearing, Campbell told Rep. Gabe Amo, D-R.I., that Australia and the U.K. "have taken a number of steps to give us more assurance about their ability to protect those secrets" but that "I think more needs to be done in terms of certain kinds of assurances."

Campbell said he appreciates the committee’s “encouragement” and “prodding” on AUKUS.

The State Department in August published an interim final rule granting the International Traffic in Arms Regulations exemptions (see 2408160019). The rule includes a 90-day public comment period to allow for further refinement (see 2408150052).

Also during the hearing, Campbell said the Biden administration wants European allies to take more action to counter China’s material support for Russia’s war against Ukraine. While “doing business with China has been a big deal for 15 or 20 years” for many European countries, these countries need to recognize that the China-Russia relationship “has the potential to destabilize Europe over the medium term and long term,” Campbell said.

Rep. Andy Barr, R-Ky., argued that the U.S. might have more success with Europe if it takes stronger action of its own. Although the Bureau of Industry and Security added nearly 30 Chinese companies to the Entity List in August for providing Russia with dual-use parts (see 2408230016), Barr said that action should have been accompanied by Treasury Department sanctions, such as Chinese Military-Industrial Complex or Specially Designated Nationals designations.

“We’re not sending the right signals to Europe,” Barr insisted. “If we sanctioned these entities for materially supporting Russia, then Europe would pay more attention.”