[Pages H3735-H3747]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

SECURITY ASSISTANCE AND ARMS EXPORT CONTROL REFORM ACT OF 2008

Mr. BERMAN. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 5916) to reform the administration of the Arms Export
Control Act, and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:

H.R. 5916

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Security
Assistance and Arms Export Control Reform Act of 2008''.
(b) Table of Contents.--The table of contents for this Act
is as follows:

Sec. 1. Short title and table of contents.

TITLE I--REFORM OF ARMS EXPORT CONTROL PROCEDURES

Subtitle A--Defense Trade Controls Performance Improvement Act of 2008

Sec. 101. Short title.
Sec. 102. Findings.
Sec. 103. Strategic review and assessment of the United States export
controls system.
Sec. 104. Performance goals for processing of applications for licenses
to export items on USML.
Sec. 105. Requirement to ensure adequate staff and resources for DDTC
of the Department of State.
Sec. 106. Audit by Inspector General of the Department of State.
Sec. 107. Increased flexibility for use of defense trade controls
registration fees.
Sec. 108. Review of ITAR and USML.
Sec. 109. Special licensing authorization for certain exports to NATO
member states, Australia, Japan, New Zealand, Israel, and
South Korea.
Sec. 110. Availability of information on the status of license
applications under chapter 3 of the Arms Export Control
Act.
Sec. 111. Sense of Congress.
Sec. 112. Definitions.
Sec. 113. Authorization of appropriations.

Subtitle B--Miscellaneous Provisions

Sec. 121. Report on self-financing options for export licensing
functions of DDTC of the Department of State.
Sec. 122. Expediting congressional defense export review period for
South Korea and Israel.
Sec. 123. Availability to Congress of Presidential directives regarding
United States arms export policies, practices, and
regulations.
Sec. 124. Increase in congressional notification thresholds and
expediting congressional review for South Korea and
Israel.
Sec. 125. Diplomatic efforts to strengthen national and international
arms export controls.
Sec. 126. Reporting requirement for unlicensed exports.

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Sec. 127. Report on value of major defense equipment and defense
articles exported under section 38 of the Arms Export
Control Act.
Sec. 128. Report on satellite export controls.
Sec. 129. Definition.

TITLE II--SECURITY ASSISTANCE AND RELATED SUPPORT FOR ISRAEL

Sec. 201. Assessment of Israel's qualitative military edge over
military threats.
Sec. 202. Report on United States' commitments to the security of
Israel.
Sec. 203. War Reserves Stockpile.
Sec. 204. Implementation of Memorandum of Understanding with Israel.
Sec. 205. Definitions.

TITLE III--WAIVER OF CERTAIN SANCTIONS TO FACILITATE DENUCLEARIZATION
ACTIVITIES IN NORTH KOREA

Sec. 301. Waiver authority and exceptions.
Sec. 302. Certification regarding waiver of certain sanctions.
Sec. 303. Congressional notification and report.
Sec. 304. Termination of waiver authority.
Sec. 305. Expiration of waiver authority.
Sec. 306. Continuation of restrictions against the Government of North
Korea.
Sec. 307. Report on verification measures relating to North Korea's
nuclear programs.
Sec. 308. Definitions.

TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Authority to build the capacity of foreign military forces.
Sec. 402. Maintenance of European Union arms embargo against China.
Sec. 403. Reimbursement of salaries of members of the reserve
components in support of security cooperation missions.
Sec. 404. Foreign Military Sales Stockpile Fund.
Sec. 405. Sense of Congress.

TITLE V--AUTHORITY TO TRANSFER NAVAL VESSELS

Sec. 501. Authority to transfer naval vessels to certain foreign
recipients.

TITLE I--REFORM OF ARMS EXPORT CONTROL PROCEDURES

Subtitle A--Defense Trade Controls Performance Improvement Act of 2008

SEC. 101. SHORT TITLE.

This subtitle may be cited as the ``Defense Trade Controls
Performance Improvement Act of 2008''.

SEC. 102. FINDINGS.

Congress finds the following:
(1) In a time of international terrorist threats and a
dynamic global economic and security environment, United
States policy with regard to export controls is in urgent
need of a comprehensive review in order to ensure such
controls are protecting the national security and foreign
policy interests of the United States.
(2) In January 2007, the Government Accountability Office
designated the effective identification and protection of
critical technologies as a government-wide, high-risk area,
warranting a strategic reexamination of existing programs,
including programs relating to arms export controls.
(3) Federal Government agencies must review licenses for
export of munitions in a thorough and timely manner to ensure
that the United States is able to assist United States allies
and to prevent nuclear and conventional weapons from getting
into the hands of enemies of the United States.
(4) Both staffing and funding that relate to the Department
of State's arms export control responsibilities have not kept
pace with the increased workload relating to such
responsibilities, especially over the last five years.
(5) Outsourcing and off-shoring of defense production and
the policy of many United States trading partners to require
offsets for major sales of defense and aerospace articles
present a potential threat to United States national security
and economic well-being and serve to weaken the defense
industrial base.
(6) Export control policies can have a negative impact on
United States employment, nonproliferation goals, and the
health of the defense industrial base, particularly when
facilitating the overseas transfer of technology or
production and other forms of outsourcing, such as offsets
(direct and indirect), co-production, subcontracts, overseas
investment and joint ventures in defense and commercial
industries. Federal Government agencies must develop new and
effective procedures for ensuring that export control systems
address these problems and the threat they pose to national
security.
(7) In the report to Congress required by the Conference
Report (Report 109-272) accompanying the bill, H.R. 2862 (the
Science, State, Justice, Commerce and Related Agencies
Appropriations Act, 2006; Public Law 109-108), the Department
of State concluded that--
(A) defense trade licensing has become much more complex in
recent years as a consequence of the increasing globalization
of the defense industry;
(B) the most important challenge to the Department of
State's licensing process has been the sheer growth in volume
of applicants for licenses and agreements, without the
corresponding increase in licensing officers;
(C) fiscal year 2005 marked the third straight year of
roughly 8 percent annual increases in licensing volume;
(D) although an 8 percent increase in workload equates to a
requirement for three additional licensing officers per year,
there has been no increase in licensing officers during this
period; and
(E) the increase in licensing volume without a
corresponding increase in trained and experienced personnel
has resulted in delays and increased processing times.
(8) In 2006, the Department of State processed over three
times as many licensing applications as the Department of
Commerce with about a fifth of the staff of the Department of
Commerce.
(9) On July 27, 2007, in testimony delivered to the
Subcommittee on Terrorism, Nonproliferation and Trade of the
House Committee on Foreign Affairs to examine the
effectiveness of the United States export control regime, the
Government Accountability Office found that--
(A) the United States Government needs to conduct
assessments to determine its overall effectiveness in the
area of arms export control; and
(B) the processing times of the Department of State doubled
over the period from 2002 to 2006.
(10) Although the current number of unprocessed
applications for licenses to export defense items is less
than 3,800 applications, due to the extraordinary efforts of
the personnel and management of the Department of State's
Directorate of Defense Trade Controls, at the end of 2006,
the Department of State's backlog of such unprocessed
applications reached its highest level at more than 10,000
unprocessed applications. This resulted in major management
and personnel challenges for the Directorate of Defense Trade
Controls.
(11)(A) Allowing a continuation of the status quo in
resources for defense trade licensing could ultimately harm
the United States defense industrial base. The 2007 Institute
for Defense Analysis report entitled ``Export Controls and
the U.S. Defense Industrial Base'' found that the large
backlog and long processing times by the Department of State
for applications for licenses to export defense items led to
an impairment of United States firms in some sectors to
conduct global business relative to foreign competitors.
(B) Additionally, the report found that United States
commercial firms have been reluctant to engage in research
and development activities for the Department of Defense
because this raises the future prospects that the products
based on this research and development, even if intrinsically
commercial, will be saddled by Department of State munitions
controls due to the link to that research.
(12) According to the Department of State's fiscal year
2008 budget justification to Congress, commercial exports
licensed or approved under the Arms Export Control Act
exceeded $30,000,000,000, with nearly eighty percent of these
items exported to United States NATO allies and other major
non-NATO allies.
(13) A Government Accountability Office report of October
9, 2001 (GAO-02-120), documented ambiguous export control
jurisdiction affecting 25 percent of the items that the
United States Government agreed to control as part of its
commitments to the Missile Technology Control Regime. The
United States Government has not clearly determined which
department has jurisdiction over these items, which increases
the risk that these items will fall into the wrong hands.
During both the 108th and 109th Congresses, the House of
Representatives passed legislation mandating that the
Administration clarify this issue.

SEC. 103. STRATEGIC REVIEW AND ASSESSMENT OF THE UNITED
STATES EXPORT CONTROLS SYSTEM.

(a) Review and Assessment.--
(1) In general.--Not later than March 31, 2009, the
President shall conduct a comprehensive and systematic review
and assessment of the United States arms export controls
system in the context of the national security interests and
strategic foreign policy objectives of the United States.
(2) Elements.--The review and assessment required under
paragraph (1) shall--
(A) determine the overall effectiveness of the United
States arms export controls system in order to, where
appropriate, strengthen controls, improve efficiency, and
reduce unnecessary redundancies across Federal Government
agencies, through administrative actions, including
regulations, and to formulate legislative proposals for new
authorities that are needed;
(B) develop processes to ensure better coordination of arms
export control activities of the Department of State with
activities of other departments and agencies of the United
States that are responsible for enforcing United States arms
export control laws;
(C) ensure that weapons-related nuclear technology, other
technology related to weapons of mass destruction, and all
items on the Missile Technology Control Regime Annex are
subject to stringent control by the United States Government;
(D) determine the overall effect of arms export controls on
counterterrorism, law enforcement, and infrastructure
protection missions of the Department of Homeland Security;
(E) contain a detailed summary of known attempts by
unauthorized end-users (such as

[[Page H3737]]

international arms traffickers, foreign intelligence
agencies, and foreign terrorist organizations) to acquire
items on the United States Munitions List and related
technical data, including--
(i) data on--

(I) commodities sought, such as M-4 rifles, night vision
devices, F-14 spare parts;
(II) parties involved, such as the intended end-users,
brokers, consignees, and shippers;
(III) attempted acquisition of technology and technical
data critical to manufacture items on the United States
Munitions List;
(IV) destination countries and transit countries;
(V) modes of transport;
(VI) trafficking methods, such as use of false
documentation and front companies registered under flags of
convenience;
(VII) whether the attempted illicit transfer was
successful; and
(VIII) any administrative or criminal enforcement actions
taken by the United States and any other government in
relation to the attempted illicit transfer;

(ii) a thorough evaluation of the Blue Lantern Program,
including the adequacy of current staffing and funding
levels;
(iii) a detailed analysis of licensing exemptions and their
successful exploitation by unauthorized end-users; and
(iv) an examination of the extent to which the increased
tendency toward outsourcing and off-shoring of defense
production harm United States national security and weaken
the defense industrial base, including direct and indirect
impact on employment, and formulate policies to address these
trends as well as the policy of some United States trading
partners to require offsets for major sales of defense
articles; and
(F) assess the extent to which export control policies and
practices under the Arms Export Control Act promote the
protection of basic human rights.
(b) Congressional Briefings.--The President shall provide
periodic briefings to the appropriate congressional
committees on the progress of the review and assessment
conducted under subsection (a). The requirement to provide
congressional briefings under this subsection shall terminate
on the date on which the President transmits to the
appropriate congressional committees the report required
under subsection (c).
(c) Report.--Not later than 18 months after the date of the
enactment of this Act, the President shall transmit to the
appropriate congressional committees and the Committee on
Armed Services of the House of Representatives and the
Committee on Armed Services of the Senate a report that
contains the results of the review and assessment conducted
under subsection (a). The report required by this subsection
shall contain a certification that the requirement of
subsection (a)(2)(C) has been met, or if the requirement has
not been met, the reasons therefor. The report required by
this subsection shall be submitted in unclassified form, but
may contain a classified annex, if necessary.

SEC. 104. PERFORMANCE GOALS FOR PROCESSING OF APPLICATIONS
FOR LICENSES TO EXPORT ITEMS ON USML.

(a) In General.--The Secretary of State, acting through the
head of the Directorate of Defense Trade Controls of the
Department of State, shall establish the following goals:
(1) The processing time for review of each application for
a license to export items on the United States Munitions List
(other than applications for approval of agreements under
part 124 of title 22, Code of Federal Regulations (or
successor regulations)) shall be not more than 60 days from
the date of receipt of the application.
(2) The processing time for review of each application for
a commodity jurisdiction determination shall be not more than
60 days from the date of receipt of the application.
(3) The total number of applications described in paragraph
(1) that are unprocessed shall be not more than 7 percent of
the total number of such applications submitted in the
preceding calendar year.
(b) Additional Review.--(1) If an application described in
paragraph (1) or (2) of subsection (a) is not processed
within the time period described in the respective paragraph
of such subsection, then the Managing Director of the
Directorate of Defense Trade Controls or the Deputy Assistant
Secretary for Defense Trade and Regional Security of the
Department of State, as appropriate, shall review the status
of the application to determine if further action is required
to process the application.
(2) If an application described in paragraph (1) or (2) of
subsection (a) is not processed within 90 days from the date
of receipt of the application, then the Assistant Secretary
for Political-Military Affairs of the Department of State
shall--
(A) review the status of the application to determine if
further action is required to process the application; and
(B) submit to the appropriate congressional committees a
notification of the review conducted under subparagraph (A),
including a description of the application, the reason for
delay in processing the application, and a proposal for
further action to process the application.
(3) For each calendar year, the Managing Director of the
Directorate of Defense Trade Controls shall review not less
than 2 percent of the total number of applications described
in paragraphs (1) and (2) of subsection (a) to ensure that
the processing of such applications, including decisions to
approve, deny, or return without action, is consistent with
both policy and regulatory requirements of the Department of
State.
(c) United States Allies.--Congress states that--
(1) it shall be the policy of the Directorate of Defense
Trade Controls of the Department of State to ensure that, to
the maximum extent practicable, the processing time for
review of applications described in subsection (a)(1) to
export items that are not subject to the requirements of
section 36(b) or (c) of the Arms Export Control Act (22
U.S.C. 2776(b) or (c)) to United States allies in direct
support of combat operations or peacekeeping or humanitarian
operations with United States Armed Forces is not more than 7
days from the date of receipt of the application; and
(2) it shall be the goal, as appropriate, of the
Directorate of Defense Trade Controls to ensure that, to the
maximum extent practicable, the processing time for review of
applications described in subsection (a)(1) to export items
that are not subject to the requirements of section 36(b) or
(c) of the Arms Export Control Act to government security
agencies of United States NATO allies, Australia, New
Zealand, Japan, South Korea, Israel, and, as appropriate,
other major non-NATO allies for any purpose other than the
purpose described in paragraph (1) is not more than 30 days
from the date of receipt of the application.
(d) Report.--Not later than December 31, 2010, and December
31, 2011, the Secretary of State shall submit to the
appropriate congressional committees a report that contains a
detailed description of--
(1)(A) the average processing time for and number of
applications described in subsection (a)(1) to--
(i) United States NATO allies, Australia, New Zealand,
Japan, South Korea, and Israel;
(ii) other major non-NATO allies; and
(iii) all other countries; and
(B) to the extent practicable, the average processing time
for and number of applications described in subsection (b)(1)
by item category;
(2) the average processing time for and number of
applications described in subsection (a)(2);
(3) the average processing time for and number of
applications for agreements described in part 124 of title
22, Code of Federal Regulations (relating to the
International Traffic in Arms Regulations);
(4) any management decisions of the Directorate of Defense
Trade Controls of the Department of State that have been made
in response to data contained in paragraphs (1) through (3);
and
(5) any advances in technology that will allow the time-
frames described in subsection (a)(1) to be substantially
reduced.
(e) Congressional Briefings.--If, at the end of any month
beginning after the date of the enactment of this Act, the
total number of applications described in subsection (a)(1)
that are unprocessed is more than 7 percent of the total
number of such applications submitted in the preceding
calendar year, then the Secretary of State, acting through
the Under Secretary for Arms Control and International
Security, the Assistant Secretary for Political-Military
Affairs, or the Deputy Assistant Secretary for Defense Trade
and Regional Security of the Department of State, as
appropriate, shall brief the appropriate congressional
committees on such matters and the corrective measures that
the Directorate of Defense Trade Controls will take to comply
with the requirements of subsection (a).
(f) Transparency of Commodity Jurisdiction
Determinations.--
(1) Declaration of policy.--Congress declares that the
complete confidentiality surrounding several hundred
commodity jurisdiction determinations made each year by the
Department of State pursuant to the International Traffic in
Arms Regulations is not necessary to protect legitimate
proprietary interests of persons or their prices and
customers, is not in the best security and foreign policy
interests of the United States, is inconsistent with the need
to ensure a level playing field for United States exporters,
and detracts from United States efforts to promote greater
transparency and responsibility by other countries in their
export control systems.
(2) Publication on internet website.--The Secretary of
State shall--
(A) upon making a commodity jurisdiction determination
referred to in paragraph (1) publish on the Internet website
of the Department of State not later than 30 days after the
date of the determination--
(i) the name of the manufacturer of the item;
(ii) a brief general description of the item;
(iii) the model or part number of the item; and
(iv) the United States Munitions List designation under
which the item has been designated, except that--

(I) the name of the person or business organization that
sought the commodity jurisdiction determination shall not be
published if the person or business organization is not the
manufacturer of the item; and
(II) the names of the customers, the price of the item, and
any proprietary information relating to the item indicated by
the person or business organization that sought the commodity
jurisdiction determination shall not be published; and

(B) maintain on the Internet website of the Department of
State an archive, that is accessible to the general public
and other departments and agencies of the United States,

[[Page H3738]]

of the information published under subparagraph (A).
(g) Rule of Construction.--Nothing in this section shall be
construed to prohibit the President or Congress from
undertaking a thorough review of the national security and
foreign policy implications of a proposed export of items on
the United States Munitions List.

SEC. 105. REQUIREMENT TO ENSURE ADEQUATE STAFF AND RESOURCES
FOR DDTC OF THE DEPARTMENT OF STATE.

(a) Requirement.--The Secretary of State shall ensure that
the Directorate of Defense Trade Controls of the Department
of State has the necessary staff and resources to carry out
this subtitle and the amendments made by this subtitle.
(b) Minimum Number of Licensing Officers.--For fiscal year
2010 and each subsequent fiscal year, the Secretary of State
shall ensure that the Directorate of Defense Trade Controls
has at least 1 licensing officer for every 1,250 applications
for licenses and other authorizations to export items on the
United States Munitions List by not later than the third
quarter of such fiscal year, based on the number of licenses
and other authorizations expected to be received during such
fiscal year. The Secretary shall ensure that in meeting the
requirement of this subsection, the performance of other
functions of the Directorate of Defense Trade Controls is
maintained and adequate staff is provided for those
functions.
(c) Minimum Number of Staff for Commodity Jurisdiction
Determinations.--For each of the fiscal years 2009 through
2011, the Secretary of State shall ensure that the
Directorate of Defense Trade Controls has, to the extent
practicable, not less than three individuals assigned to
review applications for commodity jurisdiction
determinations.
(d) Enforcement Resources.--In accordance with section
127.4 of title 22, Code of Federal Regulations, U.S.
Immigration and Customs Enforcement is authorized to
investigate violations of the International Traffic in Arms
Regulations on behalf of the Directorate of Defense Trade
Controls of the Department of State. The Secretary of State
shall ensure that the Directorate of Defense Trade Controls
has adequate staffing for enforcement of the International
Traffic in Arms Regulations.

SEC. 106. AUDIT BY INSPECTOR GENERAL OF THE DEPARTMENT OF
STATE.

(a) Audit.--Not later than the end of each of the fiscal
years 2010 and 2011, the Inspector General of the Department
of State shall conduct an independent audit to determine the
extent to which the Department of State is meeting the
requirements of sections 104 and 105 of this Act.
(b) Report.--The Inspector General shall submit to the
appropriate congressional committees a report that contains
the result of each audit conducted under subsection (a).

SEC. 107. INCREASED FLEXIBILITY FOR USE OF DEFENSE TRADE
CONTROLS REGISTRATION FEES.

(a) In General.--Section 45 of the State Department Basic
Authorities Act of 1956 (22 U.S.C. 2717) is amended--
(1) in the first sentence--
(A) by striking ``For'' and inserting ``(a) In General.--
For''; and
(B) by striking ``Office'' and inserting ``Directorate'';
(2) by amending the second sentence to read as follows:
``(b) Availability of Fees.--Fees credited to the account
referred to in subsection (a) shall be available only for
payment of expenses incurred for--
``(1) management,
``(2) licensing (in order to meet the requirements of
section 105 of the Defense Trade Controls Performance
Improvement Act of 2008 (relating to adequate staff and
resources of the Directorate of Defense Trade Controls)),
``(3) compliance,
``(4) policy activities, and
``(5) facilities,
of defense trade controls functions.''; and
(3) by adding at the end the following:
``(c) Allocation of Fees.--In allocating fees for payment
of expenses described in subsection (b), the Secretary of
State shall accord the highest priority to payment of
expenses incurred for personnel and equipment of the
Directorate of Defense Trade Controls, including payment of
expenses incurred to meet the requirements of section 105 of
the Defense Trade Controls Performance Improvement Act of
2008.''.
(b) Conforming Amendment.--Section 38(b)(3)(A) of the Arms
Export Control Act (22 U.S.C. 2778(b)(3)(A)) is amended to
read as follows:
``(3)(A) For each fiscal year, 100 percent of registration
fees collected pursuant to paragraph (1) shall be credited to
a Department of State account, to be available without fiscal
year limitation. Fees credited to that account shall be
available only for the payment of expenses incurred for--
``(i) management,
``(ii) licensing (in order to meet the requirements of
section 105 of the Defense Trade Controls Performance
Improvement Act of 2008 (relating to adequate staff and
resources of the Directorate of Defense Trade Controls)),
``(iii) compliance,
``(iv) policy activities, and
``(v) facilities,
of defense trade controls functions.''.

SEC. 108. REVIEW OF ITAR AND USML.

(a) In General.--The Secretary of State, in coordination
with the heads of other relevant departments and agencies of
the United States Government, shall review, with the
assistance of United States manufacturers and other
interested parties described in section 111(2) of this Act,
the International Traffic in Arms Regulations and the United
States Munitions List to determine those technologies and
goods that warrant different or additional controls.
(b) Conduct of Review.--In carrying out the review required
under subsection (a), the Secretary of State shall review not
less than 20 percent of the technologies and goods on the
International Traffic in Arms Regulations and the United
States Munitions List in each calendar year so that for the
5-year period beginning with calendar year 2009, and for each
subsequent 5-year period, the International Traffic in Arms
Regulations and the United States Munitions List will be
reviewed in their entirety.
(c) Report.--The Secretary of State shall submit to the
appropriate congressional committees and the Committee on
Armed Services of the House of Representatives and the
Committee on Armed Services of the Senate an annual report on
the results of the review carried out under this section.

SEC. 109. SPECIAL LICENSING AUTHORIZATION FOR CERTAIN EXPORTS
TO NATO MEMBER STATES, AUSTRALIA, JAPAN, NEW
ZEALAND, ISRAEL, AND SOUTH KOREA.

(a) In General.--Section 38 of the Arms Export Control Act
(22 U.S.C. 2778) is amended by adding at the end the
following:
``(k) Special Licensing Authorization for Certain Exports
to NATO Member States, Australia, Japan, New Zealand, Israel,
and South Korea.--
``(1) Authorization.--(A) The President may provide for
special licensing authorization for exports of United States-
manufactured spare and replacement parts or components listed
in an application for such special licensing authorization in
connection with defense items previously exported to NATO
member states, Australia, Japan, New Zealand, Israel, and
South Korea. A special licensing authorization issued
pursuant to this clause shall be effective for a period not
to exceed 5 years.
``(B) An authorization may be issued under subparagraph (A)
only if the applicable government of the country described in
subparagraph (A), acting through the applicant for the
authorization, certifies that--
``(i) the export of spare and replacement parts or
components supports a defense item previously lawfully
exported;
``(ii) the spare and replacement parts or components will
be transferred to a defense agency of a country described in
subparagraph (A) that is a previously approved end-user of
the defense items and not to a distributor or a foreign
consignee of such defense items;
``(iii) the spare and replacement parts or components will
not to be used to materially enhance, optimize, or otherwise
modify or upgrade the capability of the defense items;
``(iv) the spare and replacement parts or components relate
to a defense item that is owned, operated, and in the
inventory of the armed forces a country described in
subparagraph (A);
``(v) the export of spare and replacement parts or
components will be effected using the freight forwarder
designated by the purchasing country's diplomatic mission as
responsible for handling transfers under chapter 2 of this
Act as required under regulations; and
``(vi) the spare and replacement parts or components to be
exported under the special licensing authorization are
specifically identified in the application.
``(C) An authorization may not be issued under subparagraph
(A) for purposes of establishing offshore procurement
arrangements or producing defense articles offshore.
``(D)(i) For purposes of this subsection, the term `United
States-manufactured spare and replacement parts or
components' means spare and replacement parts or
components--
``(I) with respect to which--
``(aa) United States-origin content costs constitute at
least 85 percent of the total content costs;
``(bb) United States manufacturing costs constitute at
least 85 percent of the total manufacturing costs; and
``(cc) foreign content, if any, is limited to content from
countries eligible to receive exports of items on the United
States Munitions List under the International Traffic in Arms
Regulations (other than de minimis foreign content);
``(II) that were last substantially transformed in the
United States; and
``(III) that are not--
``(aa) classified as significant military equipment; or
``(bb) listed on the Missile Technology Control Regime
Annex.
``(ii) For purposes of clause (i)(I)(aa) and (bb), the
costs of non-United States-origin content shall be determined
using the final price or final cost associated with the non-
United States-origin content.
``(2) Inapplicability provisions.--(A) The provisions of
this subsection shall not apply with respect to re-exports or
re-transfers of spare and replacement parts or components and
related services of defense items described in paragraph (1).
``(B) The congressional notification requirements contained
in section 36(c) of this Act shall not apply with respect to
an authorization issued under paragraph (1).''.

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(b) Effective Date.--The President shall issue regulations
to implement amendments made by subsection (a) not later than
180 days after the date of the enactment of this Act.

SEC. 110. AVAILABILITY OF INFORMATION ON THE STATUS OF
LICENSE APPLICATIONS UNDER CHAPTER 3 OF THE
ARMS EXPORT CONTROL ACT.

Chapter 3 of the Arms Export Control Act (22 U.S.C. 2771 et
seq.) is amended by inserting after section 38 the following
new section:

``SEC. 38A. AVAILABILITY OF INFORMATION ON THE STATUS OF
LICENSE APPLICATIONS UNDER THIS CHAPTER.

``(a) Availability of Information.--Not later than one year
after the date of the enactment of the Defense Trade Controls
Performance Improvement Act of 2008, the President shall make
available to persons who have pending license applications
under this chapter and the committees of jurisdiction the
ability to access electronically current information on the
status of each license application required to be submitted
under this chapter.
``(b) Matters To Be Included.--The information referred to
in subsection (a) shall be limited to the following:
``(1) The case number of the license application.
``(2) The date on which the license application is received
by the Department of State and becomes an `open application'.
``(3) The date on which the Directorate of Defense Trade
Controls makes a determination with respect to the license
application or transmits it for interagency review, if
required.
``(4) The date on which the interagency review process for
the license application is completed, if such a review
process is required.
``(5) The date on which the Department of State begins
consultations with the congressional committees of
jurisdiction with respect to the license application.
``(6) The date on which the license application is sent to
the congressional committees of jurisdiction.''.

SEC. 111. SENSE OF CONGRESS.

It is the sense of Congress that--
(1)(A) the advice provided to the Secretary of State by the
Defense Trade Advisory Group (DTAG) supports the regulation
of defense trade and helps ensure that United States national
security and foreign policy interests continue to be
protected and advanced while helping to reduce unnecessary
impediments to legitimate exports in order to support the
defense requirements of United States friends and allies; and
(B) therefore, the Secretary of State should share
significant planned rules and policy shifts with DTAG for
comment; and
(2) recognizing the constraints imposed on the Department
of State by the nature of a voluntary organization such as
DTAG, the Secretary of State is encouraged to ensure that
members of DTAG are drawn from a representative cross-section
of subject matter experts from the United States defense
industry, relevant trade and labor associations, academic,
and foundation personnel.

SEC. 112. DEFINITIONS.

In this subtitle:
(1) Appropriate congressional committees.--The term
``appropriate congressional committees'' means the Committee
on Foreign Affairs of the House of Representatives and the
Committee on Foreign Relations of the Senate.
(2) International traffic in arms regulations; itar.--The
term ``International Traffic in Arms Regulations'' or
``ITAR'' means those regulations contained in parts 120
through 130 of title 22, Code of Federal Regulations (or
successor regulations).
(3) Major non-nato ally.--The term ``major non-NATO ally''
means a country that is designated in accordance with section
517 of the Foreign Assistance Act of 1961 (22 U.S.C. 2321k)
as a major non-NATO ally for purposes of the Foreign
Assistance Act of 1961 (22 U.S.C. 2151 et seq.) and the Arms
Export Control Act (22 U.S.C. 2751 et seq.).
(4) Missile technology control regime; mtcr.--The term
``Missile Technology Control Regime'' or ``MTCR'' has the
meaning given the term in section 11B(c)(2) of the Export
Administration Act of 1979 (50 U.S.C. App. 2401b(c)(2)).
(5) Missile technology control regime annex; mtcr annex.--
The term ``Missile Technology Control Regime Annex'' or
``MTCR Annex'' has the meaning given the term in section
11B(c)(4) of the Export Administration Act of 1979 (50 U.S.C.
App. 2401b(c)(4)).
(6) Offsets.--The term ``offsets'' includes compensation
practices required of purchase in either government-to-
government or commercial sales of defense articles or defense
services under the Arms Export Control Act (22 U.S.C. 2751 et
seq.) and the International Traffic in Arms Regulations.
(7) United states munitions list; usml.--The term ``United
States Munitions List'' or ``USML'' means the list referred
to in section 38(a)(1) of the Arms Export Control Act (22
U.S.C. 2778(a)(1)).

SEC. 113. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated such sums as may be
necessary for fiscal year 2009 and each subsequent fiscal
year to carry out this subtitle and the amendments made by
this subtitle.

Subtitle B--Miscellaneous Provisions

SEC. 121. REPORT ON SELF-FINANCING OPTIONS FOR EXPORT
LICENSING FUNCTIONS OF DDTC OF THE DEPARTMENT
OF STATE.

Not later than 90 days after the date of the enactment of
this Act, the Secretary of State shall submit to the
appropriate congressional committees a report on possible
mechanisms to place the export licensing functions of the
Directorate of Defense Trade Controls of the Department of
State on a 100 percent self-financing basis.

SEC. 122. EXPEDITING CONGRESSIONAL DEFENSE EXPORT REVIEW
PERIOD FOR SOUTH KOREA AND ISRAEL.

The Arms Export Control Act (22 U.S.C. 2751 et seq.) is
amended--
(1) in sections 3(d)(2)(B), 3(d)(3)(A)(i), 3(d)(5),
21(e)(2)(A), 36(b)(2), 36(c)(2)(A), 36(d)(2)(A), 62(c)(1),
and 63(a)(2) by inserting ``the Republic of Korea, Israel,''
before ``or New Zealand'';
(2) in section 3(b)(2), by inserting ``the Government of
the Republic of Korea,'' before ``or the Government of New
Zealand''; and
(3) in section 21(h)(1)(A), by inserting ``the Republic of
Korea,'' before ``or Israel''.

SEC. 123. AVAILABILITY TO CONGRESS OF PRESIDENTIAL DIRECTIVES
REGARDING UNITED STATES ARMS EXPORT POLICIES,
PRACTICES, AND REGULATIONS.

(a) In General.--The President shall make available to the
appropriate congressional committees the text of each
Presidential directive regarding United States export
policies, practices, and regulations relating to the
implementation of the Arms Export Control Act (22 U.S.C. 2751
et seq.) not later than 15 days after the date on which the
directive has been signed or authorized by the President.
(b) Transition Provision.--Any Presidential directive
described in subsection (a) that is signed or authorized by
the President on or after January 1, 2008, and before the
date of the enactment of this Act shall be made available to
the appropriate congressional committees not later than 90
days after the date of the enactment of this Act.
(c) Form.--To the maximum extent practicable, the
Presidential directives required to be made available to the
appropriate congressional committees under this section shall
be made available on an unclassified basis.

SEC. 124. INCREASE IN CONGRESSIONAL NOTIFICATION THRESHOLDS
AND EXPEDITING CONGRESSIONAL REVIEW FOR SOUTH
KOREA AND ISRAEL.

(a) Foreign Military Sales.--
(1) In general.--Subsection (b) of section 36 of the Arms
Export Control Act (22 U.S.C. 2776) is amended--
(A) by redesignating paragraphs (2) through (6) as
paragraphs (3) through (7), respectively; and
(B) by striking ``The letter of offer shall not be issued''
and all that follows through ``enacts a joint resolution''
and inserting the following:
``(2) The letter of offer shall not be issued--
``(A) with respect to a proposed sale of any defense
articles or defense services under this Act for $200,000,000
or more, any design and construction services for
$300,000,000 or more, or any major defense equipment for
$75,000,000 or more, to the North Atlantic Treaty
Organization (NATO), any member country of NATO, Japan,
Australia, the Republic of Korea, Israel, or New Zealand, if
Congress, within 15 calendar days after receiving such
certification, or
``(B) with respect to a proposed sale of any defense
articles or services under this Act for $100,000,000 or more,
any design and construction services for $200,000,000 or
more, or any major defense equipment for $50,000,000 or more,
to any other country or organization, if Congress, within 30
calendar days after receiving such certification,
enacts a joint resolution''.

(2) Technical and conforming amendments.--Such section is
further amended--
(A) in subsection (b)--
(i) in paragraph (6)(C), as redesignated, by striking
``Subject to paragraph (6), if'' and inserting ``If''; and
(ii) by striking paragraph (7), as redesignated; and
(B) in subsection (c)(4), by striking ``subsection (b)(5)''
each place it appears and inserting ``subsection (b)(6)''.
(b) Commercial Sales.--Subsection (c) of such section is
amended--
(1) in paragraph (2)--
(A) in subparagraph (A)--
(i) by inserting after ``for an export'' the following:
``of any major defense equipment sold under a contract in the
amount of $75,000,000 or more or of defense articles or
defense services sold under a contract in the amount of
$200,000,000 or more, (or, in the case of a defense article
that is a firearm controlled under category I of the United
States Munitions List, $1,000,000 or more)''; and
(ii) by striking ``Organization,'' and inserting
``Organization (NATO),'' and by further striking ``that
Organization'' and inserting ``NATO''; and
(B) in subparagraph (C), by inserting after ``license'' the
following: ``for an export of any major defense equipment
sold under a contract in the amount of $50,000,000 or more or
of defense articles or defense services sold under a contract
in the amount of $100,000,000 or more, (or, in the case of a
defense article that is a firearm controlled under category I
of the United States Munitions List, $1,000,000 or more)'';
and
(2) by striking paragraph (5).

[[Page H3740]]

SEC. 125. DIPLOMATIC EFFORTS TO STRENGTHEN NATIONAL AND
INTERNATIONAL ARMS EXPORT CONTROLS.

(a) Sense of Congress.--It is the sense of Congress that
the President should redouble United States diplomatic
efforts to strengthen national and international arms export
controls by establishing a senior-level initiative to ensure
that such arms export controls are comparable to and
supportive of United States arms export controls,
particularly with respect to countries of concern to the
United States.
(b) Report.--No later than one year after the date of the
enactment of this Act, and annually thereafter for four
years, the President shall transmit to the appropriate
committees of Congress a report on United States diplomatic
efforts described in subsection (a).

SEC. 126. REPORTING REQUIREMENT FOR UNLICENSED EXPORTS.

Section 655(b) of the Foreign Assistance Act of 1961 (22
U.S.C. 2415(b)) is amended--
(1) in paragraph (2), by striking ``or'' at the end;
(2) in paragraph (3), by striking the period at the end and
inserting ``; or''; and
(3) by adding at the end the following:
``(4) were exported without a license under section 38 of
the Arms Export Control Act (22 U.S.C. 2778) pursuant to an
exemption established under the International Traffic in Arms
Regulations, other than defense articles exported in
furtherance of a letter of offer and acceptance under the
Foreign Military Sales program or a technical assistance or
manufacturing license agreement, including the specific
exemption provision in the regulation under which the export
was made.''.

SEC. 127. REPORT ON VALUE OF MAJOR DEFENSE EQUIPMENT AND
DEFENSE ARTICLES EXPORTED UNDER SECTION 38 OF
THE ARMS EXPORT CONTROL ACT.

Section 38 of the Arms Export Control Act (22 U.S.C. 2778)
is amended by adding at the end the following:
``(l) Report.--
``(1) In general.--The President shall transmit to the
appropriate congressional committees a report that contains a
detailed listing, by country and by international
organization, of the total dollar value of major defense
equipment and defense articles exported pursuant to licenses
authorized under this section for the previous fiscal year.
``(2) Inclusion in annual budget.--The report required by
this subsection shall be included in the supporting
information of the annual budget of the United States
Government required to be submitted to Congress under section
1105 of title 31, United States Code.
``(3) Appropriate congressional committees defined.--In
this subsection, the term `appropriate congressional
committees' means the Committee on Foreign Affairs of the
House of Representatives and the Committee on Foreign
Relations of the Senate.''.

SEC. 128. REPORT ON SATELLITE EXPORT CONTROLS.

(a) Report.--Not later than 180 days after the date of the
enactment of this Act, the President shall transmit to the
appropriate congressional committees and the Committee on
Armed Services of the House of Representatives and the
Committee on Armed Services of the Senate a report
regarding--
(1) the extent to which current United States export
controls on satellites and related items under the Arms
Export Control Act are successfully preventing the transfer
of militarily-sensitive technologies to countries of concern,
especially the People's Republic of China;
(2) the extent to which comparable satellites and related
items are available from foreign sources without comparable
export controls; and
(3) whether the current export controls on satellites and
related items should be altered and in what manner, including
whether other incentives or disincentives should also be
employed to discourage exports of satellites and related
items to the People's Republic of China by any country.
(b) Definitions.--In this section, the terms ``satellite''
and ``related items'' mean satellites and all specifically
designed or modified systems or subsystems, components,
parts, accessories, attachments, and associated equipment for
satellites as covered under category XV of the International
Traffic in Arms Regulations (as in effect on the date of the
enactment of this Act).

SEC. 129. DEFINITION.

In this subtitle, the term ``appropriate congressional
committees'' means the Committee on Foreign Affairs of the
House of Representatives and the Committee on Foreign
Relations of the Senate.

TITLE II--SECURITY ASSISTANCE AND RELATED SUPPORT FOR ISRAEL

SEC. 201. ASSESSMENT OF ISRAEL'S QUALITATIVE MILITARY EDGE
OVER MILITARY THREATS.

(a) Assessment Required.--The President shall carry out an
empirical and qualitative assessment on an ongoing basis of
the extent to which Israel possesses a qualitative military
edge over military threats to Israel. The assessment required
under this subsection shall be sufficiently robust so as to
facilitate comparability of data over concurrent years.
(b) Use of Assessment.--The President shall ensure that the
assessment required under subsection (a) is used to inform
the review by the United States of applications to sell
defense articles and defense services under the Arms Export
Control Act (22 U.S.C. 2751 et seq.) to countries in the
Middle East.
(c) Reports.--
(1) Initial report.--Not later than 180 days after the date
of the enactment of this Act, the President shall transmit to
the appropriate congressional committees a report on the
initial assessment required under subsection (a).
(2) Quadrennial report.--Not later than four years after
the date on which the President transmits the initial report
under paragraph (1), and every four years thereafter, the
President shall transmit to the appropriate congressional
committees a report on the most recent assessment required
under subsection (a).
(d) Certification.--Section 36 of the Arms Export Control
Act (22 U.S.C. 2776) is amended by adding at the end the
following:
``(h) Certification Requirement Relating Israel's
Qualitative Military Edge.--
``(1) In general.--Any certification relating to a proposed
sale or export of defense articles or defense services under
this section to any country in the Middle East other than
Israel shall include a determination that the sale or export
of the defense articles or defense services will not
adversely affect Israel's qualitative military edge over
military threats to Israel.
``(2) Definition.--In this subsection, the term
`qualitative military edge' has the meaning given the term in
section 205 of the Security Assistance and Arms Export
Control Reform Act of 2008.''.

SEC. 202. REPORT ON UNITED STATES' COMMITMENTS TO THE
SECURITY OF ISRAEL.

(a) Initial Report.--Not later than 30 days after the date
of the enactment of this Act, the President shall transmit to
the appropriate congressional committees a report that
contains--
(1) a complete, unedited, and unredacted copy of each
assurance made by United States Government officials to
officials of the Government of Israel regarding Israel's
security and maintenance of Israel's qualitative military
edge, as well as any other assurance regarding Israel's
security and maintenance of Israel's qualitative military
edge provided in conjunction with exports under the Arms
Export Control Act (22 U.S.C. 2751 et seq.), for the period
beginning on January 1, 1975, and ending on the date of the
enactment of this Act; and
(2) an analysis of the extent to which, and by what means,
each such assurance has been and is continuing to be
fulfilled.
(b) Subsequent Reports.--
(1) New assurances and revisions.--The President shall
transmit to the appropriate congressional committees a report
that contains the information required under subsection (a)
with respect to--
(A) each assurance described in subsection (a) made on or
after the date of the enactment of this Act, or
(B) revisions to any assurance described in subsection (a)
or subparagraph (A) of this paragraph,

within 15 days of the new assurance or revision being
conveyed.
(2) 5-year reports.--Not later than 5 years after the date
of the enactment of this Act, and every 5 years thereafter,
the President shall transmit to the appropriate congressional
committees a report that contains the information required
under subsection (a) with respect to each assurance described
in subsection (a) or paragraph (1)(A) of this subsection and
revisions to any assurance described in subsection (a) or
paragraph (1)(A) of this subsection during the preceding 5-
year period.
(c) Form.--Each report required by this section shall be
transmitted in unclassified form, but may contain a
classified annex, if necessary.

SEC. 203. WAR RESERVES STOCKPILE.

(a) Department of Defense Appropriations Act, 2005.--
Section 12001(d) of the Department of Defense Appropriations
Act, 2005 (Public Law 108-287; 118 Stat. 1011), is amended by
striking ``4'' and inserting ``6''.
(b) Foreign Assistance Act of 1961.--Section 514(b)(2)(A)
of the Foreign Assistance Act of 1961 (22 U.S.C.
2321h(b)(2)(A)) is amended by striking ``fiscal years 2007
and 2008'' and inserting ``fiscal years 2009 and 2010''.
(c) Effective Date.--The amendment made by subsection (a)
takes effect on August 5, 2008.

SEC. 204. IMPLEMENTATION OF MEMORANDUM OF UNDERSTANDING WITH
ISRAEL.

(a) In General.--Of the amount made available for fiscal
year 2009 for assistance under the program authorized by
section 23 of the Arms Export Control Act (22 U.S.C. 2763)
(commonly referred to as the ``Foreign Military Financing
Program''), the amount specified in subsection (b) is
authorized to be made available on a grant basis for Israel.
(b) Computation of Amount.--The amount referred to in
subsection (a) is the amount equal to--
(1) the amount specified under the heading ``Foreign
Military Financing Program'' for Israel for fiscal year 2008;
plus
(2) $150,000,000.
(c) Other Authorities.--
(1) Availability of funds for advanced weapons systems.--To
the extent the Government of Israel requests the United
States to provide assistance for fiscal year 2009 for

[[Page H3741]]

the procurement of advanced weapons systems, amounts
authorized to be made available for Israel under this section
shall, as agreed to by Israel and the United States, be
available for such purposes, of which not less than
$670,650,000 shall be available for the procurement in Israel
of defense articles and defense services, including research
and development.
(2) Disbursement of funds.--Amounts authorized to be made
available for Israel under this section shall be disbursed
not later than 30 days after the date of the enactment of an
Act making appropriations for the Department of State,
foreign operations, and related programs for fiscal year
2009, or October 31, 2008, whichever occurs later.

SEC. 205. DEFINITIONS.

In this subtitle--
(1) the term ``appropriate congressional committees'' means
the Committee on Foreign Affairs of the House of
Representatives and the Committee on Foreign Relations of the
Senate; and
(2) the term ``qualitative military edge'' means the
ability to counter and defeat any credible conventional
military threat from any individual state or possible
coalition of states or from non-state actors, while
sustaining minimal damages and casualties, through the use of
superior military means, possessed in sufficient quantity,
including weapons, command, control, communication,
intelligence, surveillance, and reconnaissance capabilities
that in their technical characteristics are superior in
capability to those of such other individual or possible
coalition of states or non-state actors.

TITLE III--WAIVER OF CERTAIN SANCTIONS TO FACILITATE DENUCLEARIZATION
ACTIVITIES IN NORTH KOREA

SEC. 301. WAIVER AUTHORITY AND EXCEPTIONS.

(a) Waiver Authority.--Except as provided in subsection
(b), the President may waive, in whole or in part, the
application of any sanction contained in subparagraph (A),
(B), (D), or (G) of section 102(b)(2) of the Arms Export
Control Act (22 U.S.C. 2799aa-1(b)(2)) with respect to North
Korea in order to provide material, direct, and necessary
assistance for disablement, dismantlement, verification, and
physical removal activities in the implementation of the
commitment of North Korea, undertaken in the Joint Statement
of September 19, 2005, ``to abandoning all nuclear weapons
and existing nuclear programs'' as part of the verifiable
denuclearization of the Korean Peninsula.
(b) Exceptions.--The waiver authority under subsection (a)
may not be exercised with respect to the following:
(1) Any export of lethal defense articles that would be
prevented by the application of section 102(b)(2)(B) of the
Arms Export Control Act.
(2) Any sanction relating to credit or credit guarantees
contained in section 102(b)(2)(D) of the Arms Export Control
Act.

SEC. 302. CERTIFICATION REGARDING WAIVER OF CERTAIN
SANCTIONS.

Assistance described in subparagraph (B) or (G) of section
102(b)(2) of the Arms Export Control Act (22 U.S.C. 2799aa-
1(b)(2)) may be provided with respect to North Korea by
reason of the exercise of the waiver authority under section
301 only if the President first determines and certifies to
the appropriate congressional committees that--
(1) all necessary steps will be taken to ensure that the
assistance will not be used to improve the military
capabilities of the armed forces of North Korea; and
(2) the exercise of the waiver authority is in the national
security interests of the United States.

SEC. 303. CONGRESSIONAL NOTIFICATION AND REPORT.

(a) Notification.--The President shall notify the
appropriate congressional committees in writing not later
than 15 days before exercising the waiver authority under
section 301.
(b) Report.--Not later than 60 days after the date of the
enactment of this Act, and annually thereafter for such time
during which the exercise of the waiver authority under
section 301 remains in effect, the President shall transmit
to the appropriate congressional committees a report that--
(1) describes in detail the progress that is being made in
the implementation of the commitment of North Korea described
in section 301, including all United States and international
activities to verify compliance with such commitment;
(2) describes in detail any failures, shortcomings, or
obstruction by North Korea with respect to the implementation
of the commitment of North Korea described in section 301;
(3) describes in detail the progress or lack thereof in the
preceding 12-month period of all other programs promoting the
elimination of North Korea's capability to develop, deploy,
transfer, or maintain weapons of mass destruction or their
delivery systems;
(4) describes in detail all United States assistance,
regardless of the source, provided to North Korea by reason
of the exercise of the waiver authority under section 301 and
any assistance provided under any other authority if such
assistance is provided for the same or similar purposes; and
(5) beginning with the second report required by this
subsection, a justification for the continuation of the
waiver exercised under section 301 and, if applicable,
section 302, for the fiscal year in which the report is
submitted.

SEC. 304. TERMINATION OF WAIVER AUTHORITY.

Any waiver in effect by reason of the exercise of the
waiver authority under section 301 shall terminate if the
President determines that North Korea--
(1)(A) on or after September 19, 2005, transferred to a
non-nuclear-weapon state, or received, a nuclear explosive
device; or
(B) on or after October 10, 2006, detonated a nuclear
explosive device; or
(2) on or after September 19, 2005--
(A) transferred to a non-nuclear-weapon state any design
information or component which is determined by the President
to be important to, and known by North Korea to be intended
by the recipient state for use in, the development or
manufacture of any nuclear explosive device, or
(B) sought and received any design information or component
which is determined by the President to be important to, and
intended by North Korea for use in, the development or
manufacture of any nuclear explosive device,

unless the President determines and certifies to the
appropriate congressional committees that such waiver is
vital to the national security interests of the United
States.

SEC. 305. EXPIRATION OF WAIVER AUTHORITY.

Any waiver in effect by reason of the exercise of the
waiver authority under section 301 shall terminate on the
date that is 4 years after the date of the enactment of this
Act. The waiver authority under section 301 may not be
exercised beginning on the date that is 3 years after the
date of the enactment of this Act.

SEC. 306. CONTINUATION OF RESTRICTIONS AGAINST THE GOVERNMENT
OF NORTH KOREA.

(a) In General.--Except as provided in section 301(a),
restrictions against the Government of North Korea that were
imposed by reason of a determination of the Secretary of
State that North Korea is a state sponsor of terrorism shall
remain in effect, and shall not be lifted pursuant to the
provisions of law under which the determination was made,
unless the President certifies to the appropriate
congressional committees that--
(1) the Government of North Korea is no longer engaged in
the transfer of technology related to the acquisition or
development of nuclear weapons, particularly to the
Governments of Iran, Syria, or any other country that is a
state sponsor of terrorism;
(2) in accordance with the Six-Party Talks Agreement of
February 13, 2007, the Government of North Korea has
``provided a complete and correct declaration of all its
nuclear programs,'' and there are measures to effectively
verify this declaration by the United States which, ``[a]t
the request of the other Parties,'' is leading ``disablement
activities'' and ``provid[ing] the funding for those
activities''; and
(3) the Government of North Korea has agreed to the
participation of the International Atomic Energy Agency in
the monitoring and verification of the shutdown and sealing
of the Yongbyon nuclear facility.
(b) State Sponsor of Terrorism Defined.--In this section,
the term ``state sponsor of terrorism'' means a country the
government of which the Secretary of State has determined,
for purposes of section 6(j) of the Export Administration Act
of 1979 (as continued in effect pursuant to the International
Emergency Economic Powers Act), section 40 of the Arms Export
Control Act, section 620A of the Foreign Assistance Act of
1961, or any other provision of law, is a government that has
repeatedly provided support for acts of international
terrorism.

SEC. 307. REPORT ON VERIFICATION MEASURES RELATING TO NORTH
KOREA'S NUCLEAR PROGRAMS.

(a) In General.--Not later than 15 days after the date of
enactment of this Act, the Secretary of State shall submit to
the appropriate congressional committees a report on
verification measures relating to North Korea's nuclear
programs under the Six-Party Talks Agreement of February 13,
2007, with specific focus on how such verification measures
are defined under the Six-Party Talks Agreement and
understood by the United States Government.
(b) Matters to Be Included.--The report required under
subsection (a) shall include, among other elements, a
detailed description of--
(1) the methods to be utilized to confirm that North Korea
has ``provided a complete and correct declaration of all of
its nuclear programs'';
(2) the specific actions to be taken in North Korea and
elsewhere to ensure a high and ongoing level of confidence
that North Korea has fully met the terms of the Six-Party
Talks Agreement relating to its nuclear programs;
(3) any formal or informal agreement with North Korea
regarding verification measures relating to North Korea's
nuclear programs under the Six-Party Talks Agreement; and
(4) any disagreement expressed by North Korea regarding
verification measures relating to North Korea's nuclear
programs under the Six-Party Talks Agreement.
(c) Form.--The report required under subsection (a) shall
be submitted in unclassified form, but may include a
classified annex.

SEC. 308. DEFINITIONS.

In this title--
(1) the term ``appropriate congressional committees''
means--
(A) the Committee on Foreign Affairs, the Committee on
Appropriations, and the Committee on Armed Services of the
House of Representatives; and

[[Page H3742]]

(B) the Committee on Foreign Relations, the Committee on
Appropriations, the Committee on Armed Services of the
Senate;
(2) the terms ``non-nuclear-weapon state'', ``design
information'', and ``component'' have the meanings given such
terms in section 102 of the Arms Export Control Act (22
U.S.C. 2799aa-1); and
(3) the term ``Six-Party Talks Agreement of February 13,
2007'' or ``Six-Party Talks Agreement'' means the action plan
released on February 13, 2007, of the Third Session of the
Fifth Round of the Six-Party Talks held in Beijing among the
People's Republic of China, the Democratic People's Republic
of Korea (North Korea), Japan, the Republic of Korea (South
Korea), the Russian Federation, and the United States
relating to the denuclearization of the Korean Peninsula,
normalization of relations between the North Korea and the
United States, normalization of relations between North Korea
and Japan, economy and energy cooperation, and matters
relating to the Northeast Asia Peace and Security Mechanism.

TITLE IV--MISCELLANEOUS PROVISIONS

SEC. 401. AUTHORITY TO BUILD THE CAPACITY OF FOREIGN MILITARY
FORCES.

(a) Authority.--The Secretary of State is authorized to
conduct a program to respond to contingencies in foreign
countries or regions by providing training, procurement, and
capacity-building of a foreign country's national military
forces and dedicated counter-terrorism forces in order for
that country to--
(1) conduct counterterrorist operations; or
(2) participate in or support military and stability
operations in which the United States is a participant.
(b) Types of Capacity-Building.--The program authorized
under subsection (a) may include the provision of equipment,
supplies, and training.
(c) Limitations.--
(1) Annual funding limitation.--The Secretary of State may
use up to $25,000,000 of funds available under the Foreign
Military Financing program for each of the fiscal years 2009
and 2010 to conduct the program authorized under subsection
(a).
(2) Assistance otherwise prohibited by law.--The Secretary
of State may not use the authority in subsection (a) to
provide any type of assistance described in subsection (b)
that is otherwise prohibited by any provision of law.
(3) Limitation on eligible countries.--The Secretary of
State may not use the authority in subsection (a) to provide
assistance described in subsection (b) to any foreign country
that is otherwise prohibited from receiving such type of
assistance under any other provision of law.
(d) Formulation and Execution of Activities.--The Secretary
of State shall consult with the head of any other appropriate
department or agency in the formulation and execution of the
program authorized under subsection (a).
(e) Congressional Notification.--
(1) Activities in a country.--Not less than 15 days before
obligating funds for activities in any country under the
program authorized under subsection (a), the Secretary of
State shall submit to the congressional committees specified
in paragraph (3) a notice of the following:
(A) The country whose capacity to engage in activities in
subsection (a) will be assisted.
(B) The budget, implementation timeline with milestones,
and completion date for completing the activities.
(2) Specified congressional committees.--The congressional
committees specified in this paragraph are the following:
(A) The Committee on Foreign Affairs and the Committee on
Appropriations of the House of Representatives.
(B) The Committee on Foreign Relations and the Committee on
Appropriations of the Senate.

SEC. 402. MAINTENANCE OF EUROPEAN UNION ARMS EMBARGO AGAINST
CHINA.

(a) Findings.--Congress makes the following findings:
(1) Congress has previously expressed its strong concerns
in House Resolution 57 of February 2, 2005, and Senate
Resolution 91 of March 17, 2005, with the transfer of
armaments and related technology to the People's Republic of
China by member states of the European Union, which increased
eightfold from 2001 to 2003, and with plans to terminate in
the near future the arms embargo they imposed in 1989
following the Tiananmen Square massacre.
(2) The deferral of a decision by the European Council to
terminate its arms embargo following adoption of the
resolutions specified in paragraph (1), the visit by the
President of the United States to Europe, and growing concern
among countries in the regions and the general public on both
sides of the Atlantic, was welcomed by the Congress.
(3) The decision by the European Parliament on April 14,
2005, by a vote of 421 to 85, to oppose the lifting of the
European Union's arms embargo on the People's Republic of
China, and resolutions issued by a number of elected
parliamentary bodies in Europe also opposing the lifting of
the arms embargo, was also welcomed by the Congress as a
reassurance that its European friends and allies understood
the gravity of prematurely lifting the embargo.
(4) The onset of a strategic dialogue between the European
Commission and the Government of the United States on the
security situation in East Asia holds out the hope that a
greater understanding will emerge of the consequences of
European assistance to the military buildup of the People's
Republic of China for peace and stability in that region, to
the security interests of the United States and its friends
and allies in the region, and, in particular, to the safety
of United States Armed Forces whose presence in the region
has been a decisive factor in ensuring peace and prosperity
since the end of World War II.
(5) A more intensive dialogue with Europe on this matter
will clarify for United States' friends and allies in Europe
how their ``non-lethal'' arms transfers improve the force
projection of the People's Republic of China, are far from
benign, and enhance the prospects for the threat or use of
force in resolving the status of Taiwan.
(6) This dialogue may result in an important new consensus
between the United States and its European partners on the
need for coordinated policies that encourage the development
of democracy in the People's Republic of China and which
discourage, not assist, China's unjustified military buildup
and pursuit of weapons that threaten its neighbors.
(7) However, the statement by the President of France in
Beijing in November 2007 that the European Union arms embargo
should be lifted is troubling, especially since France will
assume the six-month presidency of the European Union in July
2008.
(8) There continues to be wide-spread concerns regarding
the lack of any significant progress by the Government of the
People's Republic of China in respecting the civil and
political rights of the Chinese people.
(b) Statement of Policy.--It shall be the policy of the
United States Government to oppose any diminution or
termination of the arms embargo that was established by the
Declaration of the European Council of June 26, 1989, and to
take whatever diplomatic and other measures that are
appropriate to convince the Member States of the European
Union, individually and collectively, to continue to observe
this embargo in principle and in practice. Appropriate
measures should include prohibitions on entering into defense
procurement contracts or defense-related research and
development arrangements with European Union Member States
that do not observe such an embargo in practice.
(c) Report.--Not later than 180 days after the date of the
enactment of this Act, and every six months thereafter until
December 31, 2010, the President shall transmit to the
Committee on Foreign Affairs and Committee on Armed Services
of the House of Representatives and the Committee on Foreign
Relations and the Committee on Armed Services of the Senate a
report on all efforts and activities of the United States
Government to ensure the success of the policy declared in
subsection (b).

SEC. 403. REIMBURSEMENT OF SALARIES OF MEMBERS OF THE RESERVE
COMPONENTS IN SUPPORT OF SECURITY COOPERATION
MISSIONS.

Section 632(d) of the Foreign Assistance Act of 1961 (22
U.S.C. 2392(d)) is amended--
(1) by striking ``(d) Except as otherwise provided'' and
inserting ``(d)(1) Except as otherwise provided''; and
(2) by adding at the end the following:
``(2) Notwithstanding provisions concerning the exclusion
of the costs of salaries of members of the Armed Forces in
section 503(a) of this Act and paragraph (1) of this
subsection, the full cost of salaries of members of the
reserve components of the Armed Forces (specified in section
10101 of title 10, United States Code) may, during each of
fiscal years 2009 and 2010, be included in calculating
pricing or value for reimbursement charged under section
503(a) of this Act and paragraph (1) of this subsection,
respectively.''.

SEC. 404. FOREIGN MILITARY SALES STOCKPILE FUND.

(a) In General.--Subsection (a) of section 51 of the Arms
Export Control Act (22 U.S.C. 2795) is amended--
(1) in paragraph (1), by striking ``Special Defense
Acquisition Fund'' and inserting ``Foreign Military Sales
Stockpile Fund''; and
(2) in paragraph (4), by inserting ``building the capacity
of recipient countries and'' before ``narcotics control
purposes''.
(b) Contents of Fund.--Subsection (b) of such section is
amended--
(1) in paragraph (2), by striking ``and'' at the end;
(2) in paragraph (3), by inserting ``and'' at the end; and
(3) by inserting after paragraph (3) the following:
``(4) collections from leases made pursuant to section 61
of this Act,''.
(c) Conforming Amendments.--(1) The heading of such section
is amended by striking ``Special Defense Acquisition Fund''
and inserting ``Foreign Military Sales Stockpile Fund''.
(2) The heading of chapter 5 of the Arms Export Control Act
is amended by striking ``SPECIAL DEFENSE ACQUISITION FUND''
and inserting ``FOREIGN MILITARY SALES STOCKPILE FUND''.

SEC. 405. SENSE OF CONGRESS.

It is the sense of Congress that the United States should
not provide security assistance or arms exports to nations
contributing to massive, widespread, and systematic
violations of human rights or acts of genocide, particularly
with respect to Darfur, Sudan.

[[Page H3743]]

TITLE V--AUTHORITY TO TRANSFER NAVAL VESSELS

SEC. 501. AUTHORITY TO TRANSFER NAVAL VESSELS TO CERTAIN
FOREIGN RECIPIENTS.

(a) Transfers by Grant.--The President is authorized to
transfer vessels to foreign countries on a grant basis under
section 516 of the Foreign Assistance Act of 1961 (22 U.S.C.
2321j), as follows:
(1) Pakistan.--To the Government of Pakistan, the OLIVER
HAZARD PERRY class guided missile frigate MCINERNEY (FFG-8).
(2) Greece.--To the Government of Greece, the OSPREY class
minehunter coastal ships OSPREY (MHC-51) and ROBIN (MHC-54).
(3) Chile.--To the Government of Chile, the KAISER class
oiler ANDREW J. HIGGINS (AO-190).
(4) Peru.--To the Government of Peru, the NEWPORT class
amphibious tank landing ships FRESNO (LST-1182) and RACINE
(LST-1191).
(b) Grants Not Counted in Annual Total of Transferred
Excess Defense Articles.--The value of a vessel transferred
to a recipient on a grant basis pursuant to authority
provided by subsection (a) shall not be counted against the
aggregate value of excess defense articles transferred in any
fiscal year under section 516(g) of the Foreign Assistance
Act of 1961.
(c) Costs of Transfers.--Any expense incurred by the United
States in connection with a transfer authorized by this
section shall be charged to the recipient.
(d) Repair and Refurbishment in United States Shipyards.--
To the maximum extent practicable, the President shall
require, as a condition of the transfer of a vessel under
this section, that the recipient to which the vessel is
transferred have such repair or refurbishment of the vessel
as is needed before the vessel joins the naval forces of the
recipient performed at a shipyard located in the United
States, including a United States Navy shipyard.
(e) Expiration of Authority.--The authority to transfer a
vessel under this section shall expire at the end of the 2-
year period beginning on the date of the enactment of this
Act.

The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
California (Mr. Berman) and the gentlewoman from Florida (Ms. Ros-
Lehtinen) each will control 20 minutes.
The Chair recognizes the gentleman from California.

General Leave

Mr. BERMAN. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days to revise and extend their remarks and include
extraneous material on the bill under consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
There was no objection.
Mr. BERMAN. Mr. Speaker, I rise in strong support of this bill and
yield myself as much time as I may consume.
Mr. Speaker, the United States has a wide variety of foreign policy
tools to promote the national security of the United States. While
these tools are often referred to as ``soft power,'' they represent
such diverse mechanisms as enhancing ties with friendly countries,
ensuring that U.S. exports are regarded positively by prospective
customers, ensuring that our policies reflect our values, and using
U.S. assistance to stem the wave of proliferation of weapons of mass
destruction that threaten our very homeland.
The bipartisan legislation before the House today, cosponsored by the
distinguished ranking member of the Committee on Foreign Affairs,
represents a new and important initiative to accomplish all these
missions.
Title I of H.R. 5916 reforms the Arms Export Control process, based
on proposals made by Mr. Sherman and Mr. Manzullo as introduced in H.R.
4246, the Defense Trade Controls Performance Improvement Act of 2007 to
create consistency in our export policy. It also provides for a
strategic review of U.S. export control policies to help ensure they
promote the protection of human rights.
It also amends the Arms Export Control Act to ensure that our close
allies, South Korea and Israel, get the same expedited licensing review
that our NATO allies, Australia, New Zealand and Japan currently enjoy.
In this regard, the bill partially draws from H.R. 5443, the United
States-Republic of Korea Cooperation Act of 2008, which was introduced
by our colleagues, Mr. Royce and Mrs. Tauscher of California.
In addition, in order to address recent major sales of defense
articles and services to countries in the Middle East, the bill insures
that Israel will maintain its qualitative military edge against
whatever security threats it may face, codifying this important
principle into law for the first time. It also authorizes the security
assistance to Israel, including implementing the recent U.S.-Israel
Memorandum of Understanding Regarding Security Assistance.
It's only fitting that as Israel commemorates the 60th anniversary of
its founding, the United States renews and strengthens its relationship
with our most important friend in the region. Israel is a democratic
island of stability in a sea of chaos, chaos which we continue to see
just this week this neighboring Lebanon. It deserves all the support we
can muster.
Finally, title III of this legislation provides for a limited waiver
of current sanctions to support and accelerate U.S. efforts to
eliminate North Korea's nuclear program. The waiver would apply to
portions of what is commonly called the Glenn Amendment.
Glenn Amendment sanctions keep the Department of Energy from funding
its own ongoing work on disabling and dismantling North Korea's nuclear
program, including removing plutonium in the next phase of this
process, as well as verifying that Pyongyang is living up to its
commitments.
Until now, a flexible but limited fund at the Department of State has
paid for this work. Continued exclusive use of this State Department
mechanism will undermine the ability of the United States to urgently
respond to unexpected opportunities to stop the proliferation of
nuclear weapons elsewhere in the world.
Title III of our bill allows for more rational funding and planning
of these activities without giving the administration a blank check. It
provides a narrow, carefully tailored authority. It also requires the
administration to document for Congress each year the need for keeping
this authority in place.
Title III also includes a provision authored by ranking member Ileana
Ros-Lehtinen that reinforces U.S. policy regarding removing North Korea
from the State Department's list of countries supporting terrorism.

{time} 1745

The conditions laid out in that provision include certification that
North Korea no longer is engaged in transferring to other countries any
technology that enables the development or acquisition of nuclear
weapons. The provision also underscores the importance of keeping the
agreement laid out in the Six-Party talks, and it states that North
Korea must agree to allow participation of the International Atomic
Energy Agency in ensuring that the Yongbyon nuclear reactor is shut
down and stays that way.
I pledge to this House that the Committee on Foreign Affairs will
continue to keep a close eye on the implementation of the Six-Party
Denuclearization Agreement. It is entirely possible that North Korea's
own actions may sour the deal. However, in the interest of U.S. and
global security, we need to forge ahead and accomplish what we can now.
Mr. Speaker, this is a good bill. I urge all of my colleagues in
joining me in supporting this important legislation.

Committee on Armed Services,

House of Representatives,

Washington, DC, May 12, 2008.
Hon. Howard L. Berman,
Chairman, Committee on Foreign Affairs, Rayburn House Office
Building, Washington, DC.
Dear Mr. Chairman: I write to confirm our mutual
understanding regarding H.R. 5916, ``To reform the
administration of the Arms Export Control Act, and for other
purposes.'' This legislation contains subject matter within
the jurisdiction of the House Committee on Armed Services.
Our Committee recognizes the importance of H.R. 5916 and
the need for the legislation to move expeditiously.
Therefore, while we have a valid claim to jurisdiction over
this legislation, the Committee on Armed Services will waive
further consideration of H.R. 5916. I do so with the
understanding that by waiving further consideration of the
bill, the Committee does not waive any future jurisdictional
claims over similar measures. In the event of a conference
with the Senate on this bill, the Committee on Armed Services
reserves the right to seek the appointment of conferees.

[[Page H3744]]

I would appreciate the inclusion of this letter and a copy
of the response in your Committee's report on H.R. 5916 and
in the Congressional Record during consideration of the
measure on the House floor.
Very truly yours,
Ike Skelton,
Chairman.
____

Committee on Foreign Affairs,

House of Representatives,

Washington, DC, May 12, 2008.
Hon. Ike Skelton,
Chairman, Committee on Armed Services, Rayburn House Office
Bldg., Washington, DC.
Dear Mr. Chairman: Thank you for your letter regarding H.R.
5916, the Security Assistance and Arms Export Control Reform
Act of 2008.
I appreciate your willingness to work cooperatively on this
legislation. I'recognize that the bill contains provisions
that fall within the jurisdiction of the Committee on Armed
Services. I agree that the inaction of your Committee with
respect to the bill does not in any way prejudice the Armed
Services Committee's jurisdictional interests and
prerogatives regarding this bill or similar legislation.
Further, as to any House-Senate conference on the bill, I
understand that your Committee reserves the right to seek the
appointment of conferees for consideration of portions of the
bill that are within the Committee's jurisdiction.
I will ensure that our exchange of letters is included in
my Committee's report on the bill and in the Congressional
Record during consideration on the House floor. I look
forward to working with you on this important legislation. If
you wish to discuss this matter further, please contact me or
have your staff contact my staff.
Cordially,
Howard L. Berman,
Chairman.

I reserve the balance of my time.
Ms. ROS-LEHTINEN. Mr. Speaker, I yield myself such time as I may
consume.
I also rise in strong support of H.R. 5916, the Security Assistance
and Arms Export Control Reform Act of 2008. Among this legislation's
provisions is language I offered which was incorporated into the
original text regarding North Korea's nuclear programs and the ongoing
Six-Party talks.
We have heard in recent days about North Korea's hand-over of 18,000
pages of so-called logs concerning its plutonium extraction activity at
the Yongbyon nuclear reactor. However, let's not be fooled yet again by
North Korea or by those seeking an agreement with this regime at any
and all costs.
These logs, according to many regional and nonproliferation experts,
do not mark any substantive progress towards nuclear disarmament. For
starters, the reporting is limited to North Korea's plutonium-based
nuclear facilities and not the totality of its nuclear weapons program
as called for under the February 2007 Six-Party agreement whereby North
Korea commits to completely disarming itself in exchange for certain
concessions from the West.
To address these important issues, the language I drafted, which was
incorporated into title III of the bill before us, clarifies and
reinforces the conditions that North Korea must meet before it can be
removed from the list of state sponsors of terrorism and before related
sanctions can be removed. No new conditions have been added. However,
this bill does specify that North Korea must take verifiable actions
regarding all of its nuclear activities before such an important
concession is granted to this duplicitous regime.
These requirements, Mr. Speaker, include ceasing to provide nuclear
assistance to countries such as Syria and Iran, providing a complete
and correct declaration of all of its nuclear programs, and in addition
to U.S. verification, agreeing to the participation of the
International Atomic Energy Agency in monitoring and verifying the
shutdown and sealing of the nuclear facility at Yongbyon.
Given North Korea's abysmal record in keeping its promises,
verification of its declarations and actions is of central importance
to any agreement. For that reason, this bill also contains language in
title III that requires the State Department to submit a report to the
committee describing the methods and actions that the U.S. will use to
verify North Korea's declarations regarding its nuclear facilities,
describing all formal and informal agreements regarding verification,
and documenting any objections regarding these measures that have been
expressed by North Korea.
This bill also strengthens U.S. national security interests and
assistance to our strong ally, Israel. It requires the administration
to perform an ongoing assessment of Israel's qualitative military edge
and authorizes an increase in U.S. Foreign Military Financing that is
consistent with the August 2007 U.S.-Israel memorandum on military
assistance.
These provisions are of vital importance because, as we all know,
Israel is surrounded by a multitude of threats which threatens its very
survival. Radical Islamic jihadists in Gaza are continuing to launch
large numbers of powerful, accurate, and deadly rockets at Israel
civilians and have smuggled weapons, cash, and armed militants from
Egypt through underground tunnels. Palestinian extremists continue to
carry out attacks inside Israel itself, including the murder of eight
people at a yeshiva in Jerusalem this past March, which included one
American.
In the aftermath of the summer 2006 war launched by Hezbollah against
Israel, this Islamic militant group continues its reign of terror made
possible by aid from Iran and Syria, both sworn enemies of Israel, both
state sponsors of terrorism, both seeking a nuclear capability, and
both receiving support from the regime in North Korea.
According to a Congressional Research Service report finalized just
last week and prepared at my request, North Korea's relationship with
the Iranian Revolutionary Guard, an entity involved in proliferation
activities and in supporting Islamic extremists, appears to be in two
areas: One, coordination and support of Hezbollah; and two, cooperation
in ballistic missile development.
And turning to Syria, Mr. Speaker, CIA Director Michael Hayden was
recently quoted as saying that the nuclear reactor the Syrian regime
was building with assistance from North Korea could have produced
enough plutonium for one or two nuclear weapons within 1 year of
beginning operations.
Then there is the growing menace from Iran's radical Islamist regime.
Defense Secretary Robert Gates recently reminded us that Iran ``is
hellbent on acquiring nuclear weapons.'' As it aggressively pursues the
nuclear option, the regime in Tehran still continues to call for Israel
to be wiped off the map.
Thus, the provisions in this bill enhancing our relationship with
Israel are critical to Israel's security and to our own vital interests
in the region. This bill also advances U.S. national security and
economic competitiveness by including language derived from legislation
introduced by Mr. Sherman of California and Mr. Manzullo promoting
long-overdue reforms in the licensing of defense exports by the State
Department. It also significantly strengthens congressional oversight
over a range of issues requiring the Executive Branch to fully consult
with our committee before undertaking any actions covered by this
legislation.
Lastly, drawing upon an initiative led by Mr. Royce of California and
strongly supported by Secretary of State Rice, it upgrades the foreign
military sales, FMS, status of our staunch ally, the Republic of Korea.
The bill also appropriately affords the same status to our close
defense relationship with Israel.
Mr. Speaker, this bill is a strong, bipartisan effort unanimously
adopted by our Committee on Foreign Affairs. It is the appropriate
vehicle to address the significant policy changes on North Korea that
the administration is requesting. It is my hope and expectation that we
allow the legislative process to take its appropriate course and that
we will not seek to circumvent the authority of the Committee on
Foreign Affairs or to undermine this bill by attaching broad waiver
language regarding North Korea to either the pending supplemental
appropriations bill or the national defense authorization bill.
I urge my colleagues to support this carefully crafted, much needed,
and bipartisan legislation.
I reserve the balance of our time.
Mr. BERMAN. Mr. Speaker, I am pleased to yield 6 minutes to the
gentleman from California, the chairman of the Subcommittee on
Terrorism, Nonproliferation, and Trade, Mr. Sherman of California.
Mr. SHERMAN. I thank the gentleman from California.
Mr. Speaker, this legislation includes the text of H.R. 4246, the
Defense Trade

[[Page H3745]]

Controls Improvement Act of 2008, which was introduced by myself and
Mr. Manzullo, and it is Title I, subtitle A of this bill.
This subtitle grew out of hearings in our subcommittee, the
Subcommittee on Terrorism Nonproliferation and Trade, which were held
last July. I want to thank Chairman Berman for including the revised
text of H.R. 4246 into this larger piece of legislation. I want to
thank Mr. Manzullo for his efforts in crafting our original
legislation, and I want to thank Mr. Ed Royce, ranking member of the
Subcommittee on Terrorism Nonproliferation and Trade, for his work as
well.
The Defense Trade Controls Improvement Act, which is part of this
larger legislation, seeks to address past performance failings and,
most importantly, understaffing of the Directorate of Defense Trade
Controls, the State Department agency responsible for adjudicating
licenses for commercial arms sales. This agency was found to have more
than 10,000 open cases at the end of 2006. Only an unsustainable winter
offensive where leaves were canceled and overtime was made mandatory
and people were moved in from other areas allowed this agency to reduce
this huge backlog. Licenses had languished for months, not because they
raised significant national security or foreign policy concerns in most
cases, but because they simply sat in someone's in box unattended.
Why has the State Department consistently underfunded and
understaffed the Directorate of Defense Trade Controls? I believe that
there is simply an institutional bias in the State Department toward
work that is more highbrow, more likely to be the subject of a seminar
at the Woodrow Wilson's School of Diplomacy. But this work, the work of
licensing munitions exports, is of critical importance; arguably there
is nothing more important done by the State Department. And Congress
provides typically over $1 billion to the relevant account which can be
used by the State Department for a whole variety of staffing, yet they
have consistently understaffed this very important function.
What the bill will do is basically add a couple of dozen licensing
officers and avoid this tendency of the State Department to understaff
the portion of the State Department which licenses munitions exports.
Why is this licensing process so important? Well, if we say ``yes''
and issue a license and make the wrong decision, the harm is obvious.
We have sent the wrong technology to the wrong country which may hurt
our military or the military of our allies in the future. But there is
also enormous harm if we unduly delay or wrongfully deny an
application. It means we lose jobs in the United States; it means our
interoperability with our allies is diminished because they won't have
American munitions and therefore, won't be able to operate as
effectively with our military as they could; it can rupture or hurt our
relationship with allies if we wrongfully do not export or unduly delay
their request to purchase American munitions, and perhaps most
importantly, when we don't act quickly and people in other countries
buy their munitions elsewhere, we are building the munitions industry
of other countries.
And what is the effect of that? More lost jobs for the United States,
more losses on interoperability, and most of all, an undercutting of
our policy objectives because once those munitions industries are well
established in other countries, they will not be subject to any U.S.-
State Department oversight and they may export to third countries
things that we would not.
So right now the relevant State Department agency has roughly 40
licensing officers available to adjudicate 85,000 cases expected to be
received this year. This bill will beef up the staffing by the third
quarter of fiscal year 2010 so that there will be one licensing officer
for every 1,250 applications that are based on what we anticipate to be
the workload that year.

{time} 1800

That is to say, we will go from roughly 40 licensing officers to
roughly 68 licensing officers. This is hardly overstaffing.
The Department of Commerce performs a similar function with regard,
not to munitions, but rather, dual-use exports. The relevant part of
the Department of Commerce deals with one-third as many applications
that has five times the staffing. Clearly, we need those 68 licensing
officers at the State Department.
This bill also requires a complete strategic review of our arms
export control system, a policy review that has not occurred since 9/
11.
The bill codifies the administration directives with respect to
processing times for licenses with respect to export of hardware to our
allies. Our exporters will have reasonable assurance that licenses will
be adjudicated, not necessarily approved, but adjudicated within 60
days unless there are extenuating circumstances.
The SPEAKER pro tempore. The gentleman's time has expired.
Mr. BERMAN. Mr. Speaker, I extend an additional minute to the
gentleman from California.
Mr. SHERMAN. This bill does not include any provisions clarifying the
jurisdiction over civilian aircraft parts since the State Department
has issued a proposed rule, designed to provide a bright line for those
decisions.
Finally, I would like to note that improvement in the operations of
the State Department office have already occurred, in part in response
to the hearings we held in July of 2007.
I hope this bill will further improve our licensing process. It is
not for us to tell the State Department that they need to have one
licensing officer for every 1,250 applications is not being overly
assertive. When we provide over $1 billion to the relevant account, we
ought to provide some guidance as to how that money should be spent.
I thank the gentleman for including our provisions in the larger
bill.
Mr. ROYCE. Mr. Speaker, I yield myself such time as I might consume.
This measure before us addresses a number of objectives, I think all
of them related to security assistance, and one of those is reform of
the State Department's export control office. I think all of us know
that it's been far too long that this office has been antiquated. It's
been incapable of functioning well in a world of rapidly evolving
technology, and what we need to do is a better job facilitating exports
by focusing on those items that pose a true risk to our national
security. This measure attempts to do that. It prevents those exports,
while allowing U.S.-made exports to markets overseas.
I'd also like to thank Chairman Berman for including the key elements
of H.R. 5443, which is the United States-Republic of Korea Defense
Cooperation Improvement Act, in this underlying legislation. And this
bill, which was authored by myself and Representative Tauscher,
upgrades South Korea's military procurement status. It streamlines
defense sales to South Korea. It puts Seoul basically on the same plane
as members of NATO and Australia and New Zealand and Japan, and thus,
it improves our defense cooperation. I think it's interesting that our
top commander in Korea called it ``bizarre and strange'' to use his
words that South Korea doesn't already enjoy this status.
Mr. Speaker, the U.S.-South Korean alliance I think is quite
distinct. With a Mutual Defense Treaty that dates back to 1953, Korea
and the U.S. form the most integrated alliance I think of interoperable
forces. On the Korean Peninsula, interoperability by the way is not
just a buzz word for the military forces there. It's a real life
practice, and passage of this legislation would help cement that
interoperability.
I'd also like to recognize the ranking member of the committee, Ms.
Ros-Lehtinen, for the inclusion in this bill of important language
regarding North Korea and its nuclear program. The language in the
underlying bill smoothes the way for dismantlement activities in North
Korea, but it makes it clear that Congress expects a complete
declaration on North Korean activities. This includes not just its
plutonium program but its uranium program as well and proliferation
business as well as the uranium. The intelligence community assesses
that this activity, by the way, continues to this day, and indeed,
North Korea is helping to fuel an arms race in the Middle East.
So this bill includes important language on verification, which
despite the rhetoric has not been taken seriously by the administration
to date.

[[Page H3746]]

I reserve the balance of my time.
Mr. BERMAN. Mr. Speaker, I reserve the balance of my time.
Mr. ROYCE. Mr. Speaker, I yield 3 minutes to the gentleman from
Illinois (Mr. Manzullo), the ranking member of the Subcommittee on
Asia, the Pacific and Global Environment.
Mr. MANZULLO. Mr. Speaker, we have a unique opportunity today to
improve national security, support our foreign policy interests, and
help American manufacturers.
H.R. 5916 is a product of nearly 18 months of work. We closely worked
with the executive branch, the business community and non-proliferation
nongovernment organizations. Without this legislation, foreign
customers will continue to search out products that are ITAR-free to
avoid being entangled in U.S. export control laws. The process
improvements in this bill will make U.S. manufacturers more competitive
in the international marketplace, creating and retaining American jobs,
and supporting economic growth here in the United States.
This legislation permits the State Department's Directorate of
Defense Trade Controls to hire more staff, reducing the backlog of
defense trade license applications and improving our scrutiny of the
most sensitive technologies.
The bill creates a special licensing authorization for American-made
spare and replacement parts. It also establishes some goals for
licensing processing, including a 7-day deadline for defense trade
licenses for those countries who support our combat, peacekeeping or
humanitarian operations.
I appreciate the Foreign Affairs Committee's efforts, particularly
the outstanding leadership of my good friend from California, Mr.
Sherman, on this very delicate issue. I urge my colleagues to support
this bill.
Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise today in strong support
of H.R. 5916, the Security Assistance and Arms Export Control Reform
Act of 2008, introduced by my colleague Mr. Berman. I would like to
thank the chairman for his leadership on this important legislation,
which will make important reforms to U.S. arms exports.
I would also like to thank the chairman and the committee staff for
working with me to incorporate two important amendments that I offered
to this bill, both of which will encourage respect of basic standards
of human rights in countries receiving security assistance and arms
exports. I believe that these two amendments improve this legislation
by taking steps to ensure that U.S. taxpayer dollars are not being used
to arm governments contributing to or engaging in massive violations of
human rights, including genocide.
My first amendment, which will be inserted as section 406 of this
legislation, states that
``It is the sense of Congress that the United States should not
provide security assistance or arms exports to nations contributing to
massive, widespread, and systematic violations of human rights or acts
of genocide, particularly with respect to Darfur, Sudan.''
This Congress has already taken remarkable strides to condemn the
genocide in Sudan, now entering its fifth year, and to work to ensure
that the people of this Nation are not unwittingly supporting these
human rights abuses. My amendment reaffirms that it is the sense of
Congress that violations of this nature, which are gross, widespread,
and systematic, are a serious issue, and that the United States should
not be providing security assistance to countries that are contributing
to such abuses.
In addition, I offered a second amendment, which would also serve to
reinforce the respect for basic human rights under this act. Section
103 of this legislation requires a ``comprehensive and systematic
review and assessment'' of the U.S. arms export controls system by the
President, to be completed not later than March 31, 2009, and sets
forth a number of elements that such a review must contain. My second
amendment adds an additional element to this report. It states that the
President's report must also:
``(F) assess the extent to which export control policies and
practices under the Arms Export Control Act promote the protection of
basic human rights.''
This language will ensure that Congress will remain apprised of the
implications of U.S. security assistance and arms exports on basic
human rights. Through the inclusion of this amendment, we will ensure
that Congress has all the information it needs to fully understand the
impact of our security assistance. Because this amendment only requires
an assessment of current human rights practices, it does not run the
risk of restricting assistance to nations that, like Liberia, have a
poor history of human rights but now, under new leadership, have made
important strides toward respect of basic human freedoms.
Mr. Speaker, I believe that a nation's human rights record should be
one element that the United States uses when determining whether
security assistance or arms trade will be extended to that nation. My
two amendments to this legislation seek to ensure that the United
States is not arming governments that are contributing to or committing
the grossest violations of human rights, like genocide, and to collect
information on how our security assistance policies are affecting human
rights in nations to which we are providing arms.
Mr. Speaker, the legislation, H.R. 5916, we are considering today
includes a number of important provisions which will strengthen and
reform U.S. security assistance and the defense trade licensing and
review process. Congress has jurisdiction over oversight of both the
U.S. arms export control process and individual sales, under the Arms
Export Control Act, while the Department of State has primary
responsibility to ensure that arms exports are in line with U.S.
foreign policy and security objectives. Unfortunately, the State
Department arms export process has broken down, and there is now an
accumulated backlog of approximately 10,000 unprocessed applications
for arms export license. Due to mismanagement and an underallocation of
resources, the State Department process has proven dysfunctional.

This legislation contains a number of important provisions which will
alleviate this serious and ongoing problem. It sets up a strategic
review, to be conducted by the President, to determine the
effectiveness of the current export control regime, and to make
improvements where necessary, including in the efficiency in export
licensing. Further, it establishes performance goals for the export
licensing process, ensuring adequate staffing, flexibility in use of
exporter annual registration fees for administrative purposes, regular
Inspector General audits, and regular review of items for inclusion/
deletion from the U.S. Munitions List. Finally, this legislation
authorizes a special up-front licensing regime for spares and
components for weapons systems previously sold to U.S. allies, and
increasing licensing process transparency measures to facilitate
Congressional oversight.
In addition to these important provisions, this legislation will
strengthen vital security relationships with a number of U.S. allies.
It adds South Korea to a list of countries already receiving expedited
Congressional review, including NATO nations, Australia, New Zealand,
and Japan. This move recognizes the critical importance of South Korea
to U.S. security and regional stability, and it is a significant
symbolic move.
This legislation also extends the same recognition to Israel, and it
authorizes the initial phase-in of the Foreign Military Financing
formula agreed on by the United States and Israel last year. Further,
this legislation requires the administration to empirically assess, on
an ongoing basis, the State of Israel's Qualitative Military Edge
against conventional or non-conventional security threats. This
provision codifies a principle that has been stated by every President
since Lyndon Johnson, and requires the administration to provide an
assessment to Congress every 4 years, to be used in reviewing arms
exports to other Middle Eastern countries. These provisions continue
U.S. assistance to Israel, and they provide for increased congressional
oversight of this assistance.
Mr. Speaker, this legislation also allows for a waiver of Section 102
(b) of the Arms Export Control Act, commonly known as the Glenn
Amendment, in the case of the North Korea nuclear program. The Glenn
amendment, adopted in 1994, prohibits all U.S. economic and military
assistance to any state that carries out a nuclear explosion and that
is, under the nuclear non-proliferation treaty, defined as a non-
nuclear weapon state. In light of the nuclear disablement and
dismantlement activities agreed to in the Six-Party Talks, this waiver
will grant the administration the ability to request appropriations
directly to the Department of Energy for these activities, rather than
its current practice of channeling such assistance through the State
Department's Nonproliferation and Disarmament Fund, which has other
high-priority demands on its funding and personnel. I support this
provision because I believe that it is in the vital national security
interest of the United States to continue to disable and hopefully
remove North Korea's means to make more nuclear weapons, weapons or
material that may be used against our interests or even transferred to
other states.
Finally, Mr. Speaker, I support a provision in Title V of this
legislation, which will grant to the government of Pakistan naval
vessels, including the Oliver Hazard Perry class guided missile frigate
McInerney (FFG-8). I believe that the continuation of U.S. assistance
to Pakistan is particularly vital at this moment, following the
February 2008 Pakistani elections in which two main opposition parties
won a majority of seats. At this crucial time for the

[[Page H3747]]

new Pakistani Government, I believe that the continuation of U.S.
assistance is vital if we are to see crucial reforms and ongoing
strides in the global fight against terrorism.
Mr. Speaker, this legislation will strengthen and reform the process
of U.S. security assistance and arms exports. I strongly urge my
colleagues to join me in supporting this legislation.
Mr. ROYCE. Mr. Speaker, I yield back the balance of my time.
Mr. BERMAN. I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from California (Mr. Berman) that the House suspend the rules
and pass the bill, H.R. 5916, as amended.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. SIMPSON. Mr. Speaker, I object to the vote on the ground that a
quorum is not present and make the point of order that a quorum is not
present.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the
Chair's prior announcement, further proceedings on this motion will be
postponed.
The point of no quorum is considered withdrawn.

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