[Code of Federal Regulations]
[Title 22, Volume 1]
[Revised as of January 1, 2009]
From the U.S. Government Printing Office via GPO Access
[CITE: 22CFR126.8]
Sec. 126.8� Proposals to foreign persons relating to significant military equipment.
��� (a) Proposals. Certain proposals to foreign persons for the sale or
manufacture abroad of significant military equipment require either the
prior approval of, or prior notification to, the Directorate of Defense
Trade Controls.
��� (1) Sale of significant military equipment: The prior approval of
the Directorate of Defense Trade Controls is required before a U.S.
person may make a proposal or presentation designed to constitute a
basis for a decision on the part of any foreign person to purchase
significant military equipment on the U.S. Munitions List whenever all
the following conditions are met:
��� (i) The value of the significant military equipment to be sold is
$14,000,000 or more; and
��� (ii) The equipment is intended for use by the armed forces of any
foreign country other than a member of the North Atlantic Treaty
Organization, Australia, New Zealand, or Japan; and
��� (iii) The sale would involve the export from the United States of
any defense article or the furnishing abroad of any defense service
including technical data; and
��� (iv) The identical significant military equipment has not been
previously licensed for permanent export or approved for sale under the
Foreign Military Sales Program of the Department of Defense, to any
foreign country.
��� (2) Sale of significant military equipment: The Directorate of
Defense Trade Controls must be notified in writing at least thirty days
in advance of any proposal or presentation concerning the sale of
significant military equipment whenever the conditions specified in
paragraphs (a)(1)(i) through (iii) of this section are met and the
identical equipment has been previously licensed for permanent export or
approved for sale under the FMS Program to any foreign country.
��� (3) Manufacture abroad of significant military equipment: The prior
approval of the Directorate of Defense Trade Controls is required before
a U.S. person may make a proposal or presentation designed to constitute
a basis for a decision on the part of any foreign person to enter into
any manufacturing license agreement or technical assistance agreement
for the production or assembly of significant military equipment,
regardless of dollar value, in any foreign country, whenever:
��� (i) The equipment is intended for use by the armed forces of any
foreign country; and
��� (ii) The agreement would involve the export from the United States
of any defense article or the furnishing abroad of any defense service
including technical data.
��� (b) Definition of proposal or presentation. The terms proposal or
presentation (designed to constitute a basis for a decision to purchase
and to enter into any agreement) mean the communication of information
in sufficient detail that the person communicating that information
knows or should know that it would permit an intended purchaser to
decide either to acquire the particular equipment in question or to
enter into the manufacturing license agreement or technical assistance
agreement. For example, a presentation which describes the equipment's
performance characteristics, price, and probable availability for
delivery would require prior notification or approval, as appropriate,
where the conditions specified in paragraph (a) of this section are met.
By contrast, the following would not require prior notification or approval:
Advertising or other reporting in a publication of general circulation;
preliminary discussions to ascertain market potential; or merely calling
attention to the fact that a company manufactures a particular item of
significant military equipment.
��� (c) Satisfaction of requirements.
��� (1) The requirement of this
section for prior approval is met by any of the following:
��� (i) A written statement from the Directorate of Defense Trade
Controls approving the proposed sale or agreement or approving the
making of a proposal or presentation.
��� (ii) A license issued under Sec. 125.2 or Sec. 125.3 of this
subchapter for the export of technical data relating to the proposed
sale or agreement to the country concerned.
��� (iii) A temporary export license issued under Sec. 123.5 of this
subchapter relating to the proposed sale or agreement for a
demonstration to the armed forces of the country of export.
��� (iv) With respect to manufacturing license agreements or technical
assistance agreements, the application for export licenses pursuant to
the two preceding subparagraphs must state that they are related to
possible agreements of this kind.
��� (2) The requirement of this section for prior notification is met by
informing the Directorate of Defense Trade Controls by letter at least
30 days before making the proposal or presentation. The letter must
comply with the procedures set forth in paragraph (d) of this section
and must identify the relevant license, approval, or FMS case by which
the identical equipment had previously been authorized for permanent
export or sale. The Directorate of Defense Trade Controls will provide
written acknowledgement of such prior notification to confirm compliance
with this requirement and the commencement of the 30-day notification
period.
��� (d) Procedures. Unless a license has been obtained pursuant to Sec.
126.8(c)(1)(ii) or (iii), a request for prior approval to make a
proposal or presentation with respect to significant military equipment,
or a 30-day prior notification regarding the sale of such equipment,
must be made by letter to the Directorate of Defense Trade Controls. The
letter must outline in detail the intended transaction, including usage
of the equipment involved and the country (or countries) involved. Seven
copies of the letter should be provided as well as seven copies of
suitable descriptive information concerning the equipment.
��� (e) Statement to accompany licensing requests. (1) Every application
for an export license or other approval to implement a sale or agreement
which meets the criteria specified in paragraph (a) of this section must
be accompanied by a statement from the applicant which either:
��� (i) Refers to a specific notification made or approval previously
granted with respect to the transaction; or
��� (ii) Certifies that no proposal or presentation requiring prior
notification or approval has been made.
��� (2) The Department of State may require a similar statement from the
Foreign Military Sales contractor concerned in any case where the United
States Government receives a request for a letter of offer for a sale
which meets the criteria specified in paragraph (a) of this section.
��� (f) Penalties. In addition to other remedies and penalties
prescribed by law or this subchapter, a failure to satisfy the prior
approval or prior notification requirements of this section may be
considered to be a reason for disapproval of a license, agreement or
sale under the FMS program.
��� (g) License for technical data. Nothing in this section constitutes
or is to be construed as an exemption from the licensing requirement for
the export of technical data that is embodied in any proposal or
presentation made to any foreign persons.