Overseas Promotion and Sale of Equipment

83. The Government imposes strategic export controls on the sales of certain military and dual-use items for several reasons including:

§                     National security

§                     International security policy and objectives

§                     International treaty obligations and commitments

§                     Concerns about the spread or terrorism, regional instability or the use of internal repression

§                     Concerns about the development of WMD and delivery systems

84. Strategic export controls are implemented through secondary legislation introduced under the Export Control Act 2002. The new legislation consolidates previous export controls on the exports of both military and dual-use goods, software and technology. The secondary legislation lists a wide range of military and dual-use goods that are subject to export controls and which may require an export licence to most destinations.

85. If a contractor is unclear whether or not an export licence is required advice should be sought from the Export Control Organisation Helpline at the Department of Trade and Industry (Tel: 020 7215 8070).

86. Fuller details on strategic export controls and the DTI ECO can be accessed at www.dti.gov.uk/export.control

Overseas Promotion and Sale of Defence Equipment or Technologies

A contractor must not promote or sell protectively marked defence equipment or technology without the prior approval of the Defence Export Services Organisation.

87. A contractor should complete a MOD Form 680 before promoting or entering into any contractual commitments involving the sale of protectively marked defence equipment or technology overseas. This includes Private Ventures that bear a protective marking (RESTRICTED or above), and any defence equipment or technologies, including Private Ventures, that have not been formally security graded. A Form 680 is still required when a contractor wishes to promote or demonstrate protectively marked equipment or technologies at the UNCLASSIFIED level. A Form 680 is not normally required for equipment or technologies that the MOD has security graded UNCLASSIFIED.

88. MOD Form 680 can be obtained from the website of the Defence Export Services Organisation www.deso.mod.uk. The DESO website contains guidance on completing the MOD Form 680 and how it is processed.

89. The system is designed to prevent unauthorised disclosure of information, and help contractors in marketing their products. It also speeds up the processing of subsequent export license applications for potential or actual sales. Contractors should allow as much notice as possible for the processing of applications.

US Re-Export Controls

90. Contractors involved in re-exporting products should note that where such products, or components within, are of US origin, or where manufactured using US technology, the US claims control over [re-exports from other countries, including the UK. In such cases, under US export regulations, a US re-export licence is required, even if a UK export licence is needed, or has been granted. Although such US regulations do not form part of UK law, contractors who do not comply may be at a serious disadvantage in any subsequent dealings with the US government or US companies.

91. British companies requiring advice on US export controls or experiencing difficulties with US regulations should contact the: DTI, North America Section Policy Unit).

92. Guidance on licensable items or restricted destinations under US regulations should be sought from the: Commercial Section, US Embassy).

Transmission
 
Products permanently, or temporarily exported, for example, for overseas exhibitions, must not be transmitted through, or carried by a carrier belonging to a country to which their sale is embargoed.

93. For the transmission of goods protectively marked CONFIDENTIAL or above a security transportation plan is required - refer to paragraph S12.6.

Licensed Manufacture

94. Authority to promote or sell an item of defence equipment does not automatically imply agreement for licensed manufacture of that equipment in the same country, because the manufacturing process involved invariably leads to an additional transfer of technology. The issues relating to technology transfer must be considered.

95. Contractors seeking clearance for licensed manufacture should follow the proposal procedures above - refer to paragraph S9.84 - making it clear in their application that it is a proposal for local manufacture.