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New challenges in technology transfer.

New Challenges in Technology Transfer The unprecedented move toward democracy in Eastern Europe will undoubtedly affect the West's trade policies and challenge government and industry managers who must react to a changing trade environment. Although controlling high-tech information, especially critical military information, is still vital to national security, the United States will increasingly focus on technologies that can be shared with other countries.

The future of the United States and its allies is more intertwined than ever, as seen in the increase in multinational research, development, and production contracts. The high cost of defense systems forces managers to examine alternatives. Sharing defense resources among allies reduces costs and provides uniformity among defense weapons.

Sharing technology and other sensitive national security assets with countries whose policies do not match those of the United States is viewed quite differently, however. Through legally and illegally acquired Western technology, Soviet Bloc countries have significantly enhanced their military capabilities and bypassed costly research and development lead-time requirements.

The United States and its allies have historically depended on the technical rather than numerical superiority of their weapons systems. Technical and scientific breakthroughs have allowed the United States to deter aggression. Despite the thawing relationship with Eastern Europe, maintaining superiority remains necessary for the future.

US and allied resistance to the export of technology is hampered by the concept of a free society, the need to seek export markets, and the predisposition of academic institutions to share ideas freely. Controlling the flow of sensitive technology is nearly impossible under those conditions.

However, stringent controls have been placed on what goes out of the country and where it goes. The Industrial Security Manual for Safeguarding Classified Information requires US contractors to protect information acquired from allied nations through bilateral security agreements.

The International Traffic in Arms Regulation (ITAR) dictates control of classified material, implements the Arms Export Control Act (22 USC 2778), and allows the president to control defense imports and exports. All unclassified material on the US Munitions List, which is part 121 of ITAR, must also be accompanied by an export license. The Department of Defense controls export licenses and the dissemination of technology to foreign nationals.

The Department of Commerce (DOC) controls the export of technical data not covered by ITAR, according to the Export Administration Act (EAA) of 1979, which is implemented through the Export Administration Regulations (EAR). The technologies listed in the EAR Commodity Control List require licenses issued by DOC. The EAA expires this year, but both houses of Congress are considering renewal legislation.

After World War II, NATO formed the Coordinating Committee for Multilateral Export Controls (COCOM) to control the flow of technology to the Soviet Union, Warsaw Pact nations, and other designated countries. Many restrictions, such as sales of advanced computers, have been relaxed because of recent changes in Eastern Europe. Exports to some countries are more liberal than those to the Soviet Union.

COCOM would like to reduce its list of restricted technologies to only the most sensitive and focus on protecting those. The Nuclear Regulatory Commission and the Departments of State, Commerce, Energy, and Defense, among others, help develop COCOM policy.

Another list that should be mentioned is the Militarily Critical Technologies List (MCTL). It alone is not a basis for deciding technology transfer cases, but it is an excellent reference for decision makers.

Copies of the latest MCTL can be obtained from the Critical Technologies STD, Institute for Defense Analysis, 1801 Beauregard Street, Alexandria, VA 22311-1772. The cost is $12.50 for one copy and $5 for each additional copy. Checks should be made out to TASK T-C2-685.

To promote understanding of US technology export and import systems, the Society for International Affairs (SIA) was founded. SIA consists of contractor and government officials who work with and want to learn more about the technology transfer system. SIA holds luncheons featuring distinguished speakers, conducts two-day seminars on various topics, and forms committees to concentrate on topics.

Increased expertise in technology transfer benefits everyone and helps prevent the export of technology to unapproved countries. Questions about SIA can be addressed to the Society for International Affairs, PO Box 9466, Arlington, VA 22209-9998.

Government agencies must join industry in stemming the export of sensitive technology that dulls the US competitive edge and gives potential adversaries advantages that threaten national security. The United States must also cooperate with allies to control transfers that may harm collective defense efforts. The political changes currently unfolding are welcome, but they do not necessarily mark the end of aggressive efforts by foreign interests to garner high-tech information from the United States.

John F. Donnelly is director of the Defense Investigative Service.
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Title Annotation:Pentagon Corner
Author:Donnelly, John F.
Publication:Security Management
Article Type:column
Date:Sep 1, 1990
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