[Congressional Record Volume 154, Number 78 (Tuesday, May 13, 2008)]
[House]
[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.

[[Page H3736]]

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).''.

[[Page H3739]]

       (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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