DDTC Issues Two Open General Licenses

Date: 07/20/2022

On July 13, 2022, the U.S. Department of State Directorate of Defense Trade Controls (“DDTC”), as part of a pilot program, issued two Open General Licenses (“OGL”), which were subsequently published via Federal Register on July 20, authorizing the retransfer and reexport of defense articles subject to the International Traffic in Arms Regulations (“ITAR”) within or between Australia, Canada, and the United Kingdom. Like General Licenses issued by the Office of Foreign Assets Control under the U.S. Treasury Department, OGL No.1 and OGL No. 2 apply if the transaction meets the stated requirements, without specific application to DDTC.

OGL No. 1, “Qualifying Retransfers within Australia, Canada, and the United Kingdom,” and OGL No. 2, “Qualifying Reexports Between or Among Australia, Canada, and the United Kingdom,” follow similar structures, and are restrained by similar limitations and provisos. OGL No. 1 permits the retransfer (i.e., change in end user within the same country) to, and OGL No. 2 permits the reexport between or among, the Governments of Australia, Canada, and the United Kingdom, members of the Australian Community (as defined in 22 CFR § 126.16(d)), members of the United Kingdom Community (as defined in 22 CFR § 126.17(d)), and Canadian-registered persons (as defined in § 126.5(b)) of unclassified defense articles, provided that the transferor comply with ITAR end-destination and recordkeeping requirements.

In particular, the transferor must maintain the following records: a description of the defense article, including technical data; the name and address of the recipient and the end-user, and other available contact information (e.g., telephone number and electronic mail address); the name of the natural person responsible for the transaction; the stated end use of the defense article; the date of the transaction; and the method of transfer. Transferors must make these records available to DDTC upon request, and “Open General License 1/2” must be used as the license or other approval number or exemption citation.

The limitations and provisos that apply to both OGLs restrict retransfers and reexport of defense articles initially transferred pursuant to certain Foreign Military Sales programs, certain missile-related defense articles, and certain major defense equipment and high-value defense articles or services. The limitations and provisos also stipulate that the transfers take place wholly within the physical territory of Australia, Canada, or the United Kingdom, and that the defense articles are for end use by or on behalf of the governments of Australia, Canada, the United Kingdom, or the United States (for reexports).

These OGLs take effect on August 1, 2022, and are valid for one year, until July 31, 2022.