The U.S. State Department and Australia's Department of Defence have jointly announced a plan to streamline licensing requirements for transferring military equipment and sensitive technology among the United States, Australia, and Britain under the AUKUS pact. Established in 2021 to address concerns about China's increasing power, AUKUS enables Australia to acquire nuclear-powered attack submarines and advanced weapons, such as hypersonic missiles, from the United States.
However, sharing closely guarded technology, which falls under the strict U.S. International Trafficking in Arms Regulations (ITAR), has posed a significant challenge to cooperation. In response, the State Department has proposed a rule change that would no longer require the Directorate of Defense Trade Controls (DDTC) to license or approve defense articles, thereby easing administrative burdens for companies producing defense products in Australia or the UK.
"This exemption is intended to promote defense trade and cooperation among the United States and its two closest allies," stated the State Department. Australian ambassador to the United States, Kevin Rudd, emphasized the transformative nature of these exemptions, stating that they will revolutionize how the three countries collaborate on defense trade.
Australia's Department of Defence has indicated that the proposed changes would eliminate the need for 900 export permits worth A$5 billion annually from Australia to the United States, as well as 200 permits for defense exports from Britain to Australia. Additionally, it was stated that license-free trade would be enabled for over 70% of defense exports subject to ITAR from the United States to Australia and for 80% of defense trade subject to Export Administration Regulations.
The UK is expected to introduce similar rule changes. A State Department official informed reporters that the U.S. move "exempts the vast majority of current licensed defense trade" between the three countries. However, the new rule would still require approval for articles deemed to have national security implications, including those governed by the Missile Technology Control Regime and inputs for nuclear devices and some landmines.
Criticism has been raised regarding the broad exclusion list, with some suggesting that it undermines trust in allies. Jeff Bialos, a former senior Defense Department official, noted that the State Department has resisted blanket exemptions for Britain and Australia for nearly 25 years.
The U.S. Commerce Department also announced a reduction in export control requirements for Australia and the United Kingdom this month. A public comment period on the U.S. and Australian rules will run from May 1 to May 31.