[Congressional Record Volume 167, Number 93 (Thursday, May 27, 2021)]
[Senate]
[Pages S3886-S3887]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        ARMS SALES NOTIFICATION

  Mr. MENENDEZ. Mr. President, section 36(b) of the Arms Export Control 
Act requires that Congress receive prior notification of certain 
proposed arms sales as defined by that statute. Upon such notification, 
the Congress has 30 calendar days during which the sale may be 
reviewed. The provision stipulates that, in the Senate, the 
notification of proposed sales shall be sent to the chairman of the 
Senate Foreign Relations Committee.
  In keeping with the committee's intention to see that relevant 
information is available to the full Senate, I ask unanimous consent to 
have printed in the Record the notifications which have been received. 
If the cover letter references a classified annex, then such annex is 
available to all Senators in the office of the Foreign Relations 
Committee, room SD-423.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                  Defense Security


                                           Cooperation Agency,

                                                    Arlington, VA.
     Hon Robert Menendez,
     Chairman, Committee on Foreign Relations,
     U.S. Senate, Washington, DC.
       Dear Mr. Chairman: Pursuant to the reporting requirements 
     of Section 36(b)(1) of the Arms Export Control Act, as 
     amended, we are forwarding herewith Transmittal No. 21-17 
     concerning the Navy's proposed Letter(s) of Offer and 
     Acceptance to the Government of Canada for defense articles 
     and services estimated to cost $1.7 billion. After this 
     letter is delivered to your office, we plan to issue a news 
     release to notify the public of this proposed sale.
           Sincerely,
                                                   Heidi H. Grant,
                                                         Director.
       Enclosures


                         Transmittal No. 21-17

     Notice of Proposed Issuance of Letter of Offer Pursuant to 
         Section 36(b)(1) of the Arms Export Control Act, as 
         amended
       (i) Prospective Purchaser: Government of Canada.
       (ii) Total Estimated Value:
       Major Defense Equipment* $ .7 billion.
       Other $1.0 billion.
       Total $1.7 billion.
       (iii) Description and Quantity or Quantities of Articles or 
     Services under Consideration for Purchase:
       Major Defense Equipment (MDE):
       Four (4) Shipsets of the AEGIS Combat System (ACS).
       One (1) AEGIS Combat System Computer Program.
       Four (4) Shipsets of AN/SPY-7 Solid State Radar Components.
       Four (4) Shipsets of Cooperative Engagement Capability 
     (CEC).
       Three (3) Shipsets of the MK 41 Vertical Launch System.
       Non-MDE: Also included is Mode 5/S capable Identification 
     Friend or Foe (IFF) equipment; early ACS development 
     activities for the Canadian Surface Combatant (CSC) Project 
     to include U.S. Government and contractor representative 
     engineering activities supporting design, integration, 
     testing, technical documentation, modeling, and training; 
     hardware to support development and testing in U.S. 
     facilities; software; documentation (including combat system 
     capabilities and limitations); training devices and services; 
     technical support; and other related elements of logistical 
     and program support.
       (iv) Military Department: Navy (CN-P-FFFAl, CN-P-LLG).
       (v) Prior Related Cases, if any: CN-P-FDP, CN-P-FFA, CN-P-
     FFF.
       (vi) Sales Commission, Fee, etc., Paid, Offered, or Agreed 
     to be Paid: None.
       (vii) Sensitivity of Technology Contained in the Defense 
     Article or Defense Services Proposed to be Sold: See Attached 
     Annex.
       (viii) Date Report Delivered to Congress: May 10, 2021.
       *As defined in Section 47(6) of the Arms Export Control 
     Act.


                          POLICY JUSTIFICATION

                      Canada--AEGIS Combat System.

       The Government of Canada has requested to buy four (4) 
     Shipsets of the AEGIS Combat System (ACS); one (1) AEGIS 
     Combat System Computer Program; four (4) Shipsets of AN/SPY-7 
     Solid State Radar Components; four (4) Shipsets of 
     Cooperative Engagement Capability (CEC); and three (3) 
     Shipsets of the MK 41 Vertical Launch System. Also included 
     is Mode 5/S capable Identification Friend or Foe (IFF) 
     equipment; early ACS development activities for the Canadian 
     Surface Combatant (CSC) Project to include U.S. Government 
     and contractor representative engineering activities 
     supporting design, integration, testing, technical 
     documentation, modeling, and training; hardware to support 
     development and testing in U.S. facilities; software; 
     documentation (including combat system capabilities and 
     limitations); training devices and services; technical 
     support; and other related elements of logistical and program 
     support. The estimated total cost is $1.7 billion.
       This proposed sale will support the foreign policy and 
     national security objectives of the United States by helping 
     to improve the military capability of Canada, a NATO ally 
     that is an important force for ensuring political stability 
     and economic progress, and a contributor to military, 
     peacekeeping and humanitarian operations around the world.
       This proposed sale will increase Canadian maritime forces' 
     interoperability with the United States and other allied 
     forces, as well as their ability to contribute to missions of 
     mutual interest by delivering the first AEGIS-capable 
     Canadian Surface Combatant ships. This will significantly 
     improve network-centric warfare capability for the U.S. 
     forces operating globally alongside Canada. Canada will have 
     no difficulty absorbing this equipment into its armed forces.
       The proposed sale of this equipment and support will not 
     alter the basic military balance in the region.
       The prime contractor will be Lockheed Martin Rotary and 
     Mission Systems, Moorestown, NJ. There are a significant 
     number of other companies under contract with the U.S. Navy 
     that will provide components, systems, and engineering 
     services during the execution of this effort. While the 
     purchaser typically requests offsets, any offset agreement 
     will be defined in future negotiations between the purchaser 
     and the contractor(s).
       Implementation of this proposed sale will require multiple 
     trips by U.S. Government representatives and the assignment 
     of contractor representatives to Canada on an intermittent 
     basis over the life of the case to support delivery and 
     integration of items and to provide supply support 
     management, inventory control and equipment familiarization.
       There will be no adverse impact on U.S. defense readiness 
     as a result of this proposed sale.


                         Transmittal No. 21-17

     Notice of Proposed Issuance of Letter of Offer Pursuant to 
         Section 36(b)(1) of the Arms Export Control Act

                           Annex Item No. vii

       (vii) Sensitivity of Technology:
       1. This sale involves the procurement of long lead material 
     and services to support the Canadian Surface Combatant 
     Program. The AEGIS Combat System (ACS) to be procured to 
     support Canadian Surface Combatant construction is derived 
     from U.S. Navy AEGIS Baseline 9 capability. Key components of 
     the ACS include:
       a. The ACS is a multi-mission combat system providing 
     integrated Air and Missile Defense for surface ships. AEGIS 
     Baseline 9 capability will provide computing, display and 
     processing hardware and software to be integrated with 
     Canada-furnished elements, including radar and illuminator 
     sensors and

[[Page S3887]]

     Canada's domestic Combat Management System (CMS 330). No 
     integrated Ballistic Missile Defense will be provided.
       b. The AEGIS Combat System Computer Program supports 
     operation of the ACS Baseline 9 capability.
       c. The AN/SPY-7 Solid State Radar Components will be 
     integrated with Lockheed Martin's Solid State Radar (SSR), 
     which is being procured by Canada via Direct Commercial Sale 
     contract.
       d. The Cooperative Engagement Capability (CEC) system fuses 
     tracking data from shipboard and off-ship sensors and 
     distributes radar measurement data to other platforms with 
     CEC capability. The system includes a Communications Security 
     (COMSEC) card.
       e. The Mk 41 Vertical Launch System (VLS) is a fixed, 
     vertical, multi-missile launching system with the capability 
     to store and launch multiple missile variants depending on 
     the warfighting mission, including the Evolved Sea Sparrow 
     Missile (ESSM), Standard Missile, and Tomahawk Cruise 
     Missiles.
       2. The highest level of classification of defense articles, 
     components, and services included in this potential sale is 
     SECRET.
       3. If a technologically advanced adversary were to obtain 
     knowledge of the specific hardware and software elements, the 
     information could be used to develop countermeasures that 
     might reduce weapon system effectiveness or be used in the 
     development of a system with similar or advanced 
     capabilities.
       4. A determination has been made that Canada can provide 
     substantially the same degree of protection for the sensitive 
     technology being released as the U.S. Government. This sale 
     is necessary in furtherance of the U.S. foreign policy and 
     national security objectives outlined in the Policy 
     Justification.
       5. All defense articles and services listed in this 
     transmittal are authorized for release and export to the 
     Government of Canada.

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