[Congressional Record (Bound Edition), Volume 162 (2016), Part 6]
[Senate]
[Pages 7828-7829]
[From the U.S. Government Publishing Office, www.gpo.gov]




                        ARMS SALES NOTIFICATION

  Mr. CORKER. 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. Bob Corker,
     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. 16-17, 
     concerning the Department of the Navy's proposed Letter(s) of 
     Offer and Acceptance to the Government of Australia for 
     defense articles and services estimated to cost $301 million. 
     After this letter is delivered to your office, we plan to 
     issue a news release to notify the public of this proposed 
     sale.
           Sincerely,
                                                Jennifer Zakriski,
                                    (For J.W. Rixey, Vice Admiral,
                                                   USN, Director.)
       Enclosures:


                         Transmittal No. 16-17

     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 Australia.
       (ii) Total Estimated Value:
       Major Defense Equipment* $216 million.
       Other $85 million.
       Total $301 million.
       (iii) Description and Quantity or Quantities of Articles or 
     Services under Consideration for Purchase:
       Major Defense Equipment (MDE):
       Up to eighty (80) STANDARD Missile, SM-2 Block IIIB 
     Vertical Launching Tactical All-Up Rounds, RIM-66M-09.
       Up to fifteen (15) MK 97 SM-2 Block IIIB Guidance Sections 
     (GSs).
       Non-MDE: This request also includes the following Non-MDE: 
     MK 13 MOD 0 Vertical Launching System Canisters, operator 
     manuals and technical documentation, U.S. Government and 
     contractor engineering, technical and logistics support 
     services.
       (iv) Military Department: Navy (AMM).
       (v) Prior Related Cases, if any: AT-P-AYR-28 JUL 10-
     $39,499,569, AT-P-LCY-30 APR 05-$221,521,728, AT-P-GSQ-22 APR 
     11-$58,842,285
       (vi)
       (vii) Sales Commission, Fee. etc. Paid, Offered, or Agreed 
     to be Paid: None.
       (viii) Sensitivity of Technology Contained in the Defense 
     Article or Defense Services Proposed to be Sold: See Annex 
     attached.
       (ix) Date Report Delivered to Congress: May 27, 2016.
       *As defined in Section 47(6) of the Arms Export Control 
     Act.


                          POLICY JUSTIFICATION

              Australia-SM-2 Block IIIB STANDARD Missiles

       The Government of Australia requested a possible sale of:

[[Page 7829]]

       Major Defense Equipment (MDE):
       Up to eighty (80) STANDARD Missile, SM-2 Block IIIB 
     Vertical Launching Tactical All-Up Rounds, RIM-66M-09.
       Up to fifteen (15) MK 97 SM-2 Block IIIB Guidance Sections 
     (GSs).
       This request also includes the following Non-MDE: MK 13 MOD 
     0 Vertical Launching System Canisters, operator manuals and 
     technical documentation, U.S. Government and contractor 
     engineering, technical and logistics support services.
       The total estimated value of MDE is $216 million. The total 
     overall estimated value is $301 million.
       Australia is one of the major political and economic powers 
     in Southeast Asia, a key democratic partner of the United 
     States in ensuring regional peace and stability, a close 
     coalition ally in major/lesser regional contingency 
     operations, and a close cooperative and international 
     exchange agreement partner. It is vital to U.S. national 
     interests that Australia develops and maintains a strong and 
     ready self-defense capability. This sale is consistent with 
     U.S. regional objectives.
       The SM-2 Block IIIB missiles proposed in this purchase will 
     be used for anti-air warfare test firings during Combat 
     Systems Ship Qualification Trials for the Royal Australian 
     Navy's three new Air Warfare Destroyers (AWD) currently under 
     construction). The SM-2 Block IIIB missiles, combined with 
     the Aegis combat systems in the AWDs, will provide 
     significantly enhanced area defense capabilities over 
     critical South East Asian air-and-sea-lines of communication. 
     Australia has already integrated the SM-2 Block IIIA into its 
     Perry-class FFGs and recently upgraded its Intermediate-Level 
     Maintenance Depot at Defense Establishment Orchard Hills with 
     new guided missile test equipment capable of maintaining the 
     SM-2 All-Up Round. Australia will have no difficulty 
     absorbing these new missiles.
       The proposed sale of this equipment and support will not 
     alter the basic military balance in the region.
       The principal contractors will be Raytheon Missile Systems 
     Company, Tucson, Arizona; Raytheon Company, Camden, Arkansas; 
     and BAE of Minneapolis and Aberdeen, South Dakota. There are 
     no known offset agreements proposed in connection with this 
     potential sale.
       Implementation of this sale will not require the assignment 
     of any U.S. or contractor representatives to Australia.
       There will be no adverse impact on U.S. defense readiness 
     as a result of this proposed sale.


                         Transmittal No. 16-17

     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. A completely assembled STANDARD Missile-2 (SM-2) Block 
     IIIB with or without a conventional warhead, whether a 
     tactical, telemetry or inert (training) configuration, is 
     classified CONFIDENTIAL. Missile component hardware includes: 
     Guidance Section (classified CONFIDENTIAL), Target Detection 
     Device (classified CONFIDENTIAL), Warhead (UNCLASSIFIED), 
     Rocket Motor (UNCLASSIFIED), Steering Control Section 
     (UNCLASSIFIED), Safe and Arming Device (UNCLASSIFIED), 
     Autopilot Battery Unit (classified CONFIDENTIAL), and if 
     telemetry missiles, AN/DKT-71 Telemeters (UNCLASSIFIED).
       2. SM-2 operator and maintenance documentation is usually 
     CONFIDENTIAL. Shipboard operation/firing guidance is 
     generally CONFIDENTIAL. Pre-firing missile assembly/pedigree 
     information is UNCLASSIFIED.
       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 Australia 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 have been authorized for release and export to 
     the Government of Australia.

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