ITAR Reorganization Delayed Due to COVID-19 Pandemic, DDTC Official Says

Plans to finalize a reorganization of the International Traffic in Arms Regulations have been put on hold due to the COVID-19 pandemic, said Mike Miller, the State Department’s deputy assistant secretary for defense trade. The reorganization -- which involves moving definitions and consolidating exemptions within the ITAR (see 1907120011) -- has been “de-emphasized as a priority,” Miller said during a May 8 conference call hosted by the Society for International Affairs. “In the current environment, with all the disruption and the difficulties everyone is facing, a rollout of that at this time would not be timely.”

Miller said he is unsure when the reorganization will resume. “I can certainly say that it's not at the top of our list right now,” he said. “There's no plan to move forward on that in the coming months.”

The Directorate of Defense Trade Controls expects increased disruptions to its operations as the COVID-19 pandemic continues, Miller said. Although the agency continues to process license applications and has seen an “uptick in hiring across the board,” it has faced complications completing end-use checks and has seen a slowdown in foreign direct investment reviews.

“We continue to be open, we continue to be doing our best to receive and process licenses at a normal pace,” Miller said. “But as the emergency continues, I think we will be increasingly challenged to maintain the base of our operations.” The DDTC is considering updating its standard operating procedures and licensing guidelines, and will look at “creative ways to keep licensing reviews moving at a good pace,” he added, which include issuing new frequently asked questions.

DDTC has continued its blue-lantern checks -- congressionally mandated end-use and pre-shipment checks on high-risk exports -- but said the process has been challenging. “Obviously our posts are in a degraded posture in many parts of the world,” Miller said. “So we're using whatever creative measures we have at our disposal to continue to do end-use checks and pre-delivery checks wherever we can.” He added that actions related to the Committee on Foreign Investment in the U.S. “have slowed, but we're continuing to do that work as well.”

As the agency tries to adapt to remote work, it also announced a series of measures to help companies impacted by the pandemic, including a reduction in registration fees (see 2005040017) and extensions of registrations and licenses (see 2004240017). The measures were mostly intended to help “the most vulnerable parts of the U.S. supply chain,” particularly small and medium-sized businesses, which will benefit from lower fees for DDTC registrants in Tier I and Tier II, Miller said. But other measures will benefit all exporters, he added, such as a six-month extension for certain licenses.

Miller also said the DDTC is already considering extending a temporary measure that allows employees involved in ITAR-related activities to work remotely. That measure expires July 31. “This is one that we may look to extend,” Miller said. “I think this was a recognition of the disruption in the current environment, and attempting to be as flexible as possible to allow work that needs to be done to continue.”