Conventional Arms Threat Reduction Director Ann K. Ganzer

Remarks for the 2014 Update Conference, July 30, 2014


Good morning. On behalf of my colleagues at the U.S. Department of State, I’d like to thank Under Secretary Hirschhorn for hosting this year’s event, and for inviting me to participate in this discussion. I welcome the opportunity to highlight some of the ways we at State ISN are supporting effective export controls around the globe within the context of the Administration’s export control reform initiative.

A lot has happened since we briefed the 2013 Update Conference. As the President announced on April 28, in response to Russia’s actions in Ukraine, the Department’s Directorate of Defense Trade Controls (DDTC)  and Commerce/BIS have been denying applications for export or re-export of high technology defense articles or services to Russia that contribute to Russia’s military capabilities.  The President announced further sanctions yesterday. This situation is fluid, and our sanctions are dependent on the facts on the ground. The United States has clearly announced that it will continue to adjust its export licensing policies toward Russia, as warranted by Russia’s actions in Ukraine.

On the export control reform front, we are well into the new world of reviewing 600 series items. We continue supporting the interagency efforts to completely review all remaining ITAR categories while at the same time working to operationalize our review of 600 series exports. Since last year’s Update conference State has reviewed 3050 cases for 600 series items. We endeavor to provide consistent and timely foreign policy analysis of these transactions by working closely with other offices within State as well as the interagency. To this end we have also identified the types of cases that the Department does not need to review in order to speed up our response time to applicants. In short, if you never had a problem exporting an item when it was regulated by the ITAR, you should not be experiencing any problems or delays exporting them to the same end use and users now that they are controlled by Commerce.

As we have said before, one of the basic tenets of the President’s export control reform initiative is to honor our commitments to the multilateral export control regimes, the Australia Group (AG), the Missile Technology Control Regime (MTCR), the Nuclear Suppliers Group (NSG), and the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual Use Goods and Technologies (WA). Multilateral standards underpin effectiveness of national export control measures and help even the playing field for international suppliers of strategic goods and technologies. With this in mind, the State Department works with the interagency to strengthen U.S. controls and bolster export controls around the world through bilateral engagements. In addition, the U.S. works in partnership with multilateral regime members to assist other countries in developing effective national strategic trade control systems. This helps ensure that bad actors will not be able to "shop around" and obtain from elsewhere technology that is denied by the United States.

Our work with regime partners is a dynamic process that intends to account for technology innovations and proliferation trends in order to refine regime guidelines and their control lists to make continual progress in fighting proliferation.

Nuclear Suppliers Group (NSG)

The 2014 Nuclear Suppliers Group Plenary, Consultative Group, and Information Exchange and Licensing and Enforcement Experts Meetings were recently held in Buenos Aires, last month, June 23-27.  At the meeting the NSG noted its strong concerns about the nuclear programs of North Korea and Iran.  The group discussed and is looking forward to proposals from the United States for a fundamental review of the NSG Guidelines, beginning with Part 2, the Dual-Use Guidelines, and with a proposal to consider supply of uncontrolled items needed for the operational safety and security of nuclear facilities in certain non-member countries.  While concerns were raised by certain Participating Governments (PGs) about these proposals, the Group agreed to continue discussions. Consensus was reached for publication on the NSG website of the German Guide to Brokering and Transits but as a "Good Practices" national paper with a number of co-sponsors including the United States, rather than an NSG "Best Practices Guide. The Group strongly endorsed the importance of a continued vigorous outreach program, not only with non-members, but also with organizations such as the IAEA, and with the other export control regimes, building on the success of recent informal meetings and joint workshops with Wassenaar Arrangement experts.

Missile Technology Control Regime (MTCR)

During the October 2013 Plenary in Rome, MTCR Partners highlighted the importance of the Regime working to address regional proliferation, adopted changes to the control list, and noted the importance of placing greater focus on intangible technology transfers, brokering and transit, and transshipment. In particular, partners had extensive discussions on the missile programs of Iran and North Korea and key procurement and technology trends related to the proliferation of Weapons of Mass Destruction (WMD) delivery systems. Partners also emphasized the importance of catch-all controls and visa vetting to impede proliferation and exchanged information on best practices in export control implementation and enforcement. In addition, the October 2013 Plenary marked the 25th anniversary of the first MTCR Plenary held in Rome in 1988. More recently, at the May 2014 MTCR’s intersessional Reinforced Point of Contact (RPOC) meeting, Partners discussed developments since the Rome Plenary and began planning for the 2014 Oslo Plenary.

Australia Group (AG)

On the Chemical and Biological Weapon, or CBW front, the Australia Group or AG continues its effort to impede the flow or supplies and technology to chemical and biological weapons programs around the world. In June 2014, the AG, held its annual plenary meeting in Paris. In the wake of the use of chemical weapons in Syria, AG members adopted a series of measures to strengthen the regime’s focus on Chemical/Biological Weapons terrorism, the implementation of ‘catch-all’ controls, and outreach to industry and academia. AG members also agreed to launch an initiative to encourage more non-member countries to adhere to the regime’s guidelines and common control lists.

The AG welcomed the progress made to rid Syria of its chemical arsenal, but also expressed concerns about lingering ambiguities about the completeness of Assad regime’s declaration to the Organization for the Prohibition of Chemical Weapons and continued reports of the use of chemical agents in the Syrian conflict.

On a more positive note, plenary participants also welcomed Mexico as the AG’s newest member.

Biological and Toxin Weapons Convention (BWC)

In the specific area of the life sciences and biotechnology, the Australia Group serves to reinforce the Biological Weapons Convention (BWC). The BWC is a short treaty, but there’s a lot packed into it. It doesn’t just outlaw the possession or development of biological weapons by states – it requires us not to transfer biological weapons or their components to others, or "in any way to assist, encourage, or induce" anyone to acquire biological weapons. And parties to the treaty are also required to take steps to "prohibit and prevent" anyone under their jurisdiction from developing or acquiring such weapons. BWC States Parties have strongly reaffirmed – most recently, just last December – the importance of effective national export control systems as a means to fulfill these obligations.

The BWC is continuing to work to develop common understandings and best practices for implementation of the BWC, including export controls, by gathering information on national implementation, and by providing targeted assistance to strengthen implementation around the world. The AG works to ensure its members fulfill their legally-binding obligations under the BWC, and the two are necessary and mutually reinforcing elements of the overall regime to stem the proliferation of biological weapons.

Wassenaar Arrangement

The Wassenaar Arrangement continues to keep pace with advances in technology and market trends. Participating States have worked to make the existing control lists more readily understood and user-friendly for licensing authorities and exporters, and to ensure the detection and denial of undesirable exports. The Arrangement continues work on a comprehensive and systematic review of the Wassenaar Lists to ensure their continued relevance.

In 2013, new export controls were agreed in a number of areas including surveillance and law enforcement/intelligence gathering tools and Internet Protocol (IP) network surveillance systems or equipment, which, under certain conditions, may be detrimental to international and regional security and stability. Participating States also further clarified existing controls in respect of inertial measurement equipment or systems and relaxed some controls such as for instrumentation tape recorders and digital computers.

Significant efforts have also been taken to promote the WA and to encourage voluntary adherence to the WA’s standards by non-WA members. The WA continues to undertake outreach in support of its aims and objectives, in particular through post-Plenary briefings, interaction with industry and bilateral dialogues with non-WA members.

Participating states in each of these consensus-based groups have voluntarily committed to observe coordinated export control guidelines and control lists. The guidelines and control lists increasingly are observed by non-member adherent countries; some of the regime lists also feature in UN Security Council Resolutions (UNSCRs) on Iran and North Korea. They are also implicitly endorsed by UNSCR 1540, which requires all UN Member States to have nonproliferation export controls to prevent the proliferation of weapons of mass destruction or their means of delivery and to prevent their acquisition by terrorist groups or other non-state actors. As a founding member and strong supporter of these regimes, the United States welcomes expanding acceptance of their multilateral export control standards.

All four regimes continue efforts to expand their outreach and dialogue with non-participating states. These efforts further the regimes’ nonproliferation objectives through technical interactions with unilateral adherents as well as pursuing greater international acceptance of the guidelines and control lists among the broader international community. At the same time, there has been strong interest by some countries to become part of the regimes.

Arms Trade Treaty (ATT)

118 countries (including the United States) have signed the Arms Trade Treaty or ATT, of which 41 have ratified, putting it near the 50 ratifications needed for its entry into force. When Secretary Kerry signed the Treaty last September, he explained what the treaty is about and why this historic treaty is in the United States’ interest. It is worth repeating his words. He said this treaty is about keeping weapons out of the hands of terrorists and rogue actors. It is about reducing the risk of illicit international transfers of conventional arms that will be used to carry out the world’s worst crimes. It is about keeping Americans safe and keeping America strong. It is about promoting international peace and global security, and about advancing important humanitarian goals.

Secretary Kerry also clearly spelled out what this treaty is not. It is not about taking away domestic freedoms. As the President has said, he strongly believes that the Second Amendment guarantees an individual’s right to bear arms. The treaty is fully consistent with the rights of U.S. citizens, including those conferred by the Second Amendment. The ATT recognizes the freedom of individuals and states to obtain, possess, and use arms for legitimate purposes. This treaty reaffirms the sovereign right of each country to decide for itself, consistent with its own constitution and legal requirements, how to deal with conventional arms exclusively within its borders.

Let me add one other thing that this treaty is not. It is not about limiting a country’s sovereign right to conduct responsible arms transfers. Indeed, the ATT is a trade regulation treaty focused exclusively on the international trade in conventional arms. It aims to create a global framework for countries’ responsible national regulation of the international transfer of conventional arms, which the treaty recognizes as a legitimate activity that supports countries’ national security and commercial interests.

The ATT will compel countries to undertake rigorous national assessments when making decisions to export weapons so that, in the future, rather than conventional arms being secreted out of warehouses and into the unknown, a government will need to have a control system in place to adequately review the request to authorize the export of such arms to another country. In this way, the Arms Trade Treaty helps establish a common international standard for regulating the international trade in conventional arms. The Arms Trade Treaty won’t change what the U.S. does on a day-to-day basis to implement effective export and import controls on conventional arms and address illicit shipments of conventional arms. Rather, it will induce other countries to come up to our standards. The goals of the ATT are important goals that are also aligned with our foreign policy and national security interests. We believe it is important for the United States to give a public endorsement of the ATT and its effectiveness so that as many other states as possible will be encouraged to sign on as well.

UN Security Council Resolution 1540

As I noted, the U.N. Security Council has adopted a number of resolutions that extend the reach of multilateral controls. Renewal of the mandate of the UNSCR 1540 Committee to 2021 marked a critical diplomatic achievement.  In extending this mandate, the U.N. Security Council requested that the Committee identify effective practices for implementing UNSCR 1540. In addition to the international practices it has already identified in its earlier reports, the 1540 Committee has begun assembling an additional set of effective practices, including on export controls, identified by the United States and other countries. The Security Council also encouraged the Committee to draw on relevant expertise, including from the private sector, so the 1540 Committee has enhanced its work with industry, especially through a series of industry-focused meetings hosted by Germany, which recognizes the crucial role of industry in developing develop effective measures to control WMD-related materials and technologies

Export Control and Related Border Security (EXBS)

The Export Control and Related Border Security, or EXBS, program is the flagship initiative of the U.S. government designed to assist other countries in developing effective national strategic trade control systems. EXBS is active in more than 60 countries worldwide and conducts more than 250 outreach and capacity building activities each year to support partner countries in developing modern legal and regulatory frameworks; effective licensing systems; greater government-to-industry outreach programs; stronger enforcement capabilities; and improved interagency and international coordination and cooperation. These efforts help partner governments fulfill their international obligations to prevent proliferation of weapons of mass destruction (WMD) and diversion of conventional arms to inappropriate end users. Partner government officials, including parliamentarians, senior executive branch officials, the judiciary, and front-line licensing and enforcement personnel take part in these capacity building efforts.

EXBS continues to be a valuable tool in pursuing U.S. nonproliferation objectives. This type of engagement and cooperation provides us with obvious security benefits while at the same time preserving our economic competitiveness by ensuring that U.S. exporters are not held to a stricter level of controls than their foreign competitors.

As countries seek to develop their high-tech industrial sectors and expand their ports and transportation networks, EXBS engagement helps give us and our allies greater confidence that controlled items will not be diverted or re-exported for unauthorized uses. EXBS engagement combines outreach to existing and emerging suppliers with capacity-building for major transshipment hubs in order to help address global supply chain security.

I would like to close by reiterating that the regimes and treaties I’ve discussed this morning continue to be dynamic. Every year changes to the control lists and guidelines based on ever-changing and advancing technology and proliferation trends are debated, negotiated, and agreed upon. Every year changes in the regime control lists, lead to updates of export control regulations not only in the United States, but around the world as well. Multilateral export controls must be continually improved, so that national security concerns are balanced with economic considerations. Finally, the treaties and United Nations Security Council Resolutions we discussed demonstrate a growing acceptance by the international community of the role of export control in addressing shared concerns.

The U.S. export control reform effort has helped us to better focus our attention on transactions that merit higher scrutiny while continuing to carry out our international commitments and obligations. In the end US export control rules is, and will continue to be, recognized as the "gold standard" and our actions will be dictated by national security and foreign policy objectives.

Thank you.