President Barack Obama announced he will ease restrictions on selling military-related products to foreign buyers, as part of an overhaul of U.S. export rules that companies said were too broad and restrictive.
The new export control policy set forth by Obama seeks to streamline and standardize the licensing process for defense-related exports, as well as create a new unified enforcement agency to monitor and crack down on violators of new export guidelines. The new agency, the “Export Enforcement Coordination Center, ” will have a mandate to improve enforcement and coordination between agencies and departments.
A review by Defense Secretary Robert Gates led to the changes in the rules that were created to keep sensitive technologies away from military adversaries. Companies that sell military-related equipment complained the list of prohibited products was outdated and difficult to decipher specific products, said Bill Reinsh, president of the National Foreign Trade Council.
“If you protect everything, you end up protecting nothing,” Reinsch told Bloomberg News. “These changes are the most important in at least 20 years in terms of defense, aerospace, and technology exports. We’re very happy.”
Honeywell International, Microsoft, Northrop Grumman and Boeing are some of the larger companies that will benefit from the changes, he said.
U.S. exports are currently regulated by three agencies, which oversee tens of thousands of products and services. Companies that sell these regulated products have said the system has left them hindered, even when it comes to less-sensitive items.
The White House announced last Tuesday that it had already started streamlining the 12,000 item export-control list for tanks and military vehicles and about one-third of the exports should be deregulated. There are 19 more categories of exports the White House said will be examined in the coming months.
The issue of controls sits at a sensitive juncture between the administration’s push to boost exports during weak economic growth and desire to maintain the country’s technical edge in key battlefield and intelligence technologies.
