Export Controls: International Space Station Technology Transfers (Letter
Report, 11/03/1999, GAO/NSIAD-00-14).
The international space station, with 16 nations involved, is one of the
largest scientific collaborations attempted. Under international
agreements, NASA, as the U.S. representative, is obligated to deliver,
disclose, or transfer technology, data, and commodities needed to
implement the program. Members of Congress have raised concerns about
the extent of safeguards to protect technology and information exported
in support of the space station. This report provides information on (1)
the licenses granted to NASA to export space station-related technology
and commodities and plans to export encryption technology and (2) the
results of internal and external assessments of NASA's export control
program and NASA's actions to implement audit recommendations.
Encryption technology maintains the secrecy of information and is needed
to provide secure transmission of command and control instructions
between ground and space components of the space station.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: NSIAD-00-14
TITLE: Export Controls: International Space Station Technology
Transfers
DATE: 11/03/1999
SUBJECT: Export regulation
Technology transfer
Internal controls
Exporting
Licenses
International trade
Internal audits
Dual-use technologies
Data encryption
IDENTIFIER: NASA International Space Station Alpha Program
U.S. Munitions List
Russia
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GAO/NSIAD-00-14
Report to the Chairman and Ranking Minority Member, Committee on Science
House of Representatives
November 1999
EXPORT CONTROLS
International Space Station Technology
Transfers
*****************
*****************
GAO/NSIAD-00-14
Letter 3
Appendixes
Appendix I:Commodities Exported Using Individual Validated Licenses
18
Appendix II:Examples of ISS-Related Commodities Exported in 1998 Under No
License Required Authority
19
Appendix III:Comments From the National Aeronautics and Space Administration
20
Appendix IV:Comments From the Department of Commerce
26
CBM common berthing mechanism
EVA extravehicular activity
ISS International Space Station
MOU Memorandums of Understanding
MDM multiplexer/demultiplexer
NASA National Aeronautics and Space Administration
OIG Office of the Inspector General
RAM Random Access Memory
National Security and
International Affairs Division
B-283363
November 3, 1999
The Honorable F. James Sensenbrenner, Jr.
Chairman
The Honorable Ralph M. Hall
Ranking Minority Member
Committee on Science
House of Representatives
With 16 countries involved, the International Space Station Program is one
of the largest scientific collaborations ever attempted./Footnote1/ Under
international agreements related to the program, the National Aeronautics
and Space Administration (NASA), as the U.S. representative, is obligated
to deliver, disclose, or transfer technology, data, and commodities
necessary to meet its responsibilities in implementing the program.
Concerned about the extent of safeguards to protect technology and
information exported in support of the space station, you and the late
Representative George Brown asked us to evaluate NASA's implementation of
federal export control regulations. Specifically, we are providing
information on
(1) licenses granted to NASA to export space station-related technology
and commodities and plans to export encryption technology and (2) the
results of internal and external assessments of NASA's export control
program and NASA's actions to implement audit recommendations. Encryption
technology provides a capability to maintain the secrecy of information
and is needed to provide secure transmission of command and control
instructions between ground and space elements of the space station.
A significant percentage of NASA's international activities may involve
transfers of commodities, software, or technologies to foreign partners by
NASA or authorized contractors. To protect national security and U.S.
foreign policy interests, the export of technology and commodities to the
15 partner countries involved with NASA in the International Space Station
Program is controlled through a system of licenses. The Departments of
Commerce and State are responsible for granting NASA such licenses.
Commerce issues licenses for the export of dual-use items--those items
that have both commercial and military applications--on the Commerce
Control List. Similarly, State issues licenses for exports of U. S.
Munitions List items--articles, services, and related technical data
designated as defense articles and services. NASA's export activities must
conform to the procedures and regulations established by Commerce and State.
Results in Brief
Since April 1995, the Commerce Department has issued nine Individual
Validated Licenses/Footnote2/ to export specific items and one special
comprehensive license that allows NASA to export certain preapproved items
without seeking Commerce's approval each time NASA needs to export them
for the International Space Station Program. Although the special
comprehensive license was intended to preclude the need for individual
licenses, NASA has only used it once because it has not been updated and,
according to NASA officials, individual licenses are easier to obtain than
updating the special comprehensive license. As new export requirements
have materialized, NASA has elected to apply for individual licenses
rather than amend the special comprehensive license. The State Department
has not issued any licenses to NASA to export technology or commodities
for the International Space Station. However, NASA erroneously authorized
the export of radiation-hardened electronic parts to Russia in 1997
without first obtaining a license from State. NASA expects to export
encryption technology for use in the program but has not determined
whether a license is needed. NASA expects that such exports will be
limited to its Japanese and European partners.
Internal and external reviews of NASA's export control activities have
identified weaknesses, including a need for greater management involvement
in export-related decisions and additional training to educate employees
involved with technology control about export laws, regulations, and
procedures. NASA has taken steps to correct these weaknesses; however,
some additional actions are needed. For example, annual internal audits
have not provided sufficient information to assess the effectiveness of
NASA's export controls for the International Space Station Program.
Resulting reports of audits that were issued in 1997 and 1998 provide
little detail and analyses beyond completing a required audit checklist.
This report recommends improvements aimed at improving the quality of
NASA's internal audits.
Background
NASA had no formalized export control policy when the Space Station
Program began in 1984, nor when the space station partnership was
established in 1988. Although NASA issued a technical data and goods
transfer control plan for the earlier Space Station Freedom Program in
1991, that plan did not include procedures for making export-licensing
determinations. When Russia joined the International Space Station (ISS)
Program in 1993, the need for associated export controls was heightened.
Thus, NASA established a Space Station Export Control Steering Group and
an Interagency Export Control Working Group early in 1994 to assist in
developing an approach to controlling exports of ISS-related commodities.
Chaired by NASA, the groups comprised senior policy, legal, and technical
representatives from the Executive Office of the President's Office of
Science and Technology Policy and the Departments of State, Commerce, and
Defense.
Since 1994, NASA has been developing a more comprehensive technology
control plan specifically for the ISS Program. The plan has remained in
draft form but has been modified since its inception. NASA intends to
finalize its most recent draft plan in mid-November 1999. In the meantime,
NASA employees, contractors, and centers supporting the ISS Program have
been instructed to use the draft control plan as guidance in implementing
ISS-related export activities.
In 1995, NASA published an agencywide export control program document for
all programs involved in international activities. NASA based its export
control program on federal laws and regulations that require licenses for
exports of controlled technologies, commodities, and services. Commerce
and State are responsible for granting licenses to NASA and its
designated contractors for the export of technologies to ISS
partners./Footnote3/ Under the authority of the Export Administration Act,
Commerce established a licensing system for exports of dual-use items--
those items that have both commercial and military applications--on the
Commerce Control List. Similarly, under the authority of the Arms Export
Control Act, State issues licenses for exports of defense articles and
defense services that are on the U.S. Munitions List. The statutory
authority to issue regulations regarding the export of dual-use items and
defense articles and services is delegated to the Secretaries of Commerce
and State. Commerce and State published the Export Administration
Regulations and International Traffic in Arms Regulations, respectively,
implementing the acts. NASA must ensure that its ISS export activities
conform to these laws and regulations. NASA's export control program
document contains a step-by-step process for NASA employees and
contractors to follow in determining whether technology and commodities
can be exported to foreign countries, with or without a license.
NASA includes the following elements in its decision to export items in
support of the ISS Program: (1) the necessity of the export and its
consistency with NASA's export control program, (2) any prohibitions on
the export established by federal law or regulation, (3) whether State or
Commerce is responsible for authorizing the export, and (4) whether the
export requires a license. The export classification process includes
these elements.
The line of authority for all NASA export-related activities originates at
NASA headquarters and flows to the agency's field center export
administrators, program and project managers, and transportation officers.
These officials share responsibility for ensuring compliance with U.S.
export control regulations and NASA's export control program. NASA's
program requires training to be conducted at least annually and covers
issues and developments in export controls that impact the agency's
international activities.
Status of Licenses and Plans to Export Encryption Technology
Since April 1995, the Commerce Department has issued nine individual
licenses to export specific items and one special comprehensive license.
With one exception, NASA has not used the special comprehensive license
granted by Commerce to facilitate exporting the large volume of ISS-
related technology and commodities that it expected to transfer to the
ISS partners. State has not issued NASA any licenses to export ISS-related
technologies. However, NASA inappropriately exported radiation-hardened
technology without having obtained a license from State. A centralized
database of exported technologies is in development and will include
information on items transferred without licenses. While encryption
technology has not been exported, the requirement for it is being
considered by NASA and its European and Japanese partners.
Licenses Issued to Export ISS Technologies
------------------------------------------
From April 1995 through May 1999, Commerce issued nine individual licenses
to NASA for the export of ISS-related technologies. An individual license
is granted in response to an application for a specific export. Six
licenses were for items shipped to Russia, two for items shipped to Italy,
and one license for items shipped to Germany. Appendix I includes a
description of the commodities transferred using these licenses and the
countries of destination.
For ISS-related exports, NASA may request an individual license or use the
ISS special comprehensive license. In May 1996, Commerce issued NASA a
special comprehensive license to facilitate the large volume of expected
exports incidental to the ISS Program and to eliminate the need to apply
for an individual license for each item it expected to export. The special
comprehensive license is to be used to export only items listed in the
bilaterally established exchange list and included in the license. None of
the items are under State's export control jurisdiction. The license
covers certain ISS hardware, software, and technical data under the export
control jurisdiction of Commerce. The license is only for the use of NASA
personnel and approved related entities, such as authorized contractors
and subcontractors listed in the license, and only when the entities have
received specific contractual direction from NASA.
With the exception of one case in which the item exported was returned
following a determination that procedures were properly followed, the
special comprehensive license has not been used./Footnote4/ NASA
headquarters export officials said that technologies listed in the special
comprehensive license, which was developed more than 3 years ago, need to
be reevaluated and that obtaining an individual license to transfer ISS
technologies is less complicated than amending the special comprehensive
license. In commenting on a draft of this report, Commerce stated that, in
1999, the NASA special license was fully entered into its electronic
license database, making it easier for NASA to submit changes. Commerce
further stated that, to export an item not identified in the original
application, NASA would need to submit one form; to export multiple items
not previously identified, NASA would submit an amendment form.
The special comprehensive license does not relieve NASA from its
obligation to request a separate license if one is required. Because
Commerce does not review each individual transaction authorized by the
special comprehensive license, NASA and the entities authorized to use it
must have mechanisms to ensure that each export made under it fulfills the
terms and conditions of the license and applicable provisions of
Commerce's export regulations.
NASA Failed to Obtain State License in One Case
-----------------------------------------------
According to NASA officials, State has not issued NASA any licenses
associated with the ISS Program to export items under the export control
jurisdiction of State. However, NASA disclosed that in January 1997,
radiation-hardened electronic parts were inappropriately exported to
Russia without a license. This export occurred because a NASA contractor's
parts supplier had received an erroneous export classification from the
manufacturer who was not aware that the parts were on State's U.S.
Munitions List, and NASA did not independently determine whether a license
was needed. Additional details about this export and the resulting NASA
investigation are discussed on pages 11 and 12 of this report.
A Database of All ISS Export Controlled Technologies Is Being Developed
------------------------------------------------------------------------
NASA is not required to acquire a license for all export-controlled items
that are ISS related. Under federal export control regulations, NASA has
exported numerous ISS-related technologies with license exceptions. An
exception allows NASA to export, under stated conditions, items subject to
Commerce's Export Administration Regulations that would otherwise require
a license. As required by State's and Commerce's regulations, NASA's
export control program includes the requirement that records be maintained
for at least 5 years on all exports and transfers. NASA's draft
ISS export control plan reiterates these requirements. Appendix II shows
examples of ISS-related export controlled commodities NASA exported in
1998 without licenses.
According to NASA officials, NASA's centers have retained individual
records of all ISS items that the agency has made export classification
decisions on and exported since 1995. However, the records were not
summarized and the ISS program office could not readily provide us with a
complete list of ISS technologies exported to its partners without
licenses. Although such a database is not required under export control
regulations, having this information would be useful to supplement
guidance and as a crosscheck in reaching future export classification
decisions. Moreover, it would provide NASA, State, and Commerce with a
tool to use in conducting reviews to assess NASA's compliance with export
laws and regulations.
According to NASA officials, the database of exported technologies
currently in development will be a centralized database and will include
information on items transferred without licenses and will be available
agencywide. The ISS database development is a Johnson Space Center and ISS
program office initiative.
Plans to Export Encryption Technology Are Being Discussed
---------------------------------------------------------
To date, no encryption technology has been exported for use in the ISS
Program. The requirements for and potential export of encryption
technology needed to support the ISS are being discussed by NASA, its
European and Japanese partners, and agencies that have export approval
authority for the technology. To date, no license has been applied for.
According to NASA officials, encryption will be needed to provide secure
transmission of command and control instructions between ISS ground and
space elements. The Japanese and European partners and NASA have agreed to
use a common U.S. standard technology as the means of encrypting command
and control communications. To use U.S. encryption technology, the
Japanese and European partners must agree to provide it a level of
protection equal to that provided by the United States, which would
require them to procure hardware from the list of sources approved by
Commerce's National Institute of Standards and Technology. NASA would
provide them technical support for the hardware selection, related
software development, and encryption key management, enabling them to
interpret the coded instructions. The Japanese and European partners are
considering a draft agreement that outlines U.S. protection requirements
for the technology. If they concur with U.S. protection requirements and
sign the agreement, NASA or the supporting contractor could initiate
action to obtain a license to export encryption technology to the
partners. NASA is collaborating with the National Security Agency and the
National Institute of Standards and Technology about exporting the
technology to these partners.
NASA officials stated that Russia would not be included as a destination
in any potential licenses for encryption technology. While Russia and the
United States will use a common infrastructure to transmit data between
ISS space and ground elements, the Russian Space Agency and NASA will not
use a common encryption technology or share such technology. Both the
United States and Russia have their own encryption systems. According to
NASA officials, Russia and the United States prefer using their own systems.
Reviews of NASA's Export Control Program Have Identified Some Weaknesses
NASA's export control program is subject to periodic internal reviews and
to external reviews by Commerce and State. Moreover, investigations can be
triggered by specific events requiring follow-up. The reviews and
investigations conducted to date have identified some weaknesses in NASA's
export control program. NASA officials have taken steps to address many of
these weaknesses. However, further actions are needed in some areas, such
as improving the quality of NASA's internal audits.
State's Review of License Application Triggered NASA's Investigation of
Radiation-Hardened Electronics Parts Exported Without License
---------------------------------------------------------------------------
In 1998, the State Department requested NASA's review and comment on a
license application involving a U.S. company affiliated with a Russian
company for radiation-hardened electronic parts. The license application
had also indicated that NASA had exported the parts to Russia in the past.
In reviewing the application, NASA detected a potential issue of improper
export with its prior transfer of the parts to Russia. NASA initiated an
investigation and found that it had inappropriately exported radiation-
hardened electronics parts to Russia for use in the ISS Program. NASA had
exported these parts without a license after the parts were erroneously
classified as the lowest level of controlled technology. NASA did not
follow its own policy, which is to determine the classification of
material proposed for export or to ensure that its contractors have
appropriately determined the material's classification. Instead, a NASA
contractor's supplier determined that the export of the parts to Russia
did not require a license and the contractor relied on that determination.
NASA, in turn, relied on its contractor's classification of these parts.
The parts were exported to Russia in January 1997. According to a NASA
export control official, the supplier's and manufacturer's regional office
officials were unaware that the radiation-hardened parts were on State's
U.S. Munitions List and therefore required an export license. NASA was
unaware of the error for about 18 months until the U.S. company affiliated
with a Russian company applied to State for an export license for the same
parts, and State referred the license application for NASA's review in
June 1998. According to a State official, the request for the license in
this instance was to support activities associated with the Russian Mir
space station. NASA export control officials told us that the application
inaccurately stated that NASA had obtained a license for an earlier export
of the same parts to Russia.
In a June 1998 letter to State about the incident, NASA formally
acknowledged the error and stated that it had reminded the Russian Space
Agency and the Russian company that the parts were solely for use in
Russian-provided components of the ISS and were not to be used for any
other purpose or transferred without NASA's written approval. The Russian
company responded that it had accounted for each of the exported parts and
indicated how they were being used and where they were located. NASA
accepted this response in good faith.
Although NASA may seek advice from the manufacturers to assist in the
determination, NASA is ultimately responsible for determining the correct
classification and requesting a license, if required. As a result of this
incident, NASA advised State in July 1999 that the ISS program office had
instituted specific changes to its export procedures, requiring
o a manufacturer export office, rather than a sales office, to confirm
export classifications of commercially available items and
o a NASA manager to be directly involved in determining export
classifications before proceeding with exports.
According to NASA, key features of this process include a centralized
database to capture all ISS exports and backup data, an Export Control
Council to review exports and resolve issues, and documented export
compliance training for employees. Also, training conducted by the ISS
export administrator highlights the fact that radiation-hardened parts are
export controlled. We concur with the need for these steps.
NASA's Office of Inspector General Assessment
---------------------------------------------
In March 1999, NASA's Office of the Inspector General (OIG) completed a
review of the agency's export activities related to controlled
technologies. The report noted that NASA had not identified all export-
controlled technologies related to its major programs and did not maintain
a catalog of classifications for transfers of export-controlled
technologies. The report further stated that agency oversight of training
for personnel in the export control program needed improvement and that,
as a result, NASA might not have adequate control over export-controlled
technologies to preclude unauthorized or unlicensed transfers. The OIG
recommended that NASA
o establish a policy and procedures for cataloging controlled
technology export classifications that would be available for all NASA
installations;
o define the qualifications of personnel that perform export program
audits;
o designate only qualified personnel to perform annual audits of the
export control program, in accordance with established policy;
o establish a policy for resolving and following up on recommendations
resulting from export control audits;
o enhance the current export control training program for NASA
personnel, to include educating them about U.S. export laws and
regulations and procedures for classifying and documenting exports; and
o expand training on a recurring basis to NASA employees involved
directly or indirectly with technology control.
NASA concurred with the OIG report, and according to NASA officials, the
agency is taking actions as follows:
o The agency plans to establish a central catalog of export control
technologies. Each center has been requested to provide the
headquarters Export Administrator copies of all classifications made
for exports to facilitate the development of the catalog.
o NASA is hiring additional staff to conduct training in export
controls and write policy guidance. NASA officials told us that it was
developing computer-based training and that the agency plans to expand
training modules to include more in-depth coverage of export laws and
regulations, classification requirements, and procedures useful for
conducting the annual audits of the export control program.
o In addition to computer-based training, the headquarters' and
centers' export control administrators will continue to conduct
training seminars on export controls.
o Auditing requirements and auditor qualifications are being included
in a NASA program directive and a NASA procedures guide scheduled to be
completed at the end of 1999. The directive and guide will also specify
how center management will follow up on recommendations resulting from
export control audits.
Commerce's Assessment of NASA's Export Controls
-----------------------------------------------
In June 1998, Commerce's Office of Exporter Services reviewed NASA's
export control program, including the use of the special comprehensive
license for the ISS Program. The purpose of this review was to ensure that
NASA was complying with the Export Administration Regulations and the
terms of the license. Commerce also reviewed pertinent records associated
with NASA's export control program, indicating in its report that NASA did
not have a formal procedure in place to ensure that products were at the
consignee sites and were being used for the intended purpose. Commerce
concluded that, overall, NASA had adequate export controls and was
complying with the act's implementing regulations. However, to ensure full
compliance with the implementing regulations, Commerce recommended that NASA
o revise its procedures for screening the Denied Persons List, a list
of specific persons whose export privileges have been denied by Commerce;
o update its export control audit module to reflect the latest Commerce
terminology-using the Denied Persons List instead of the Table of
Denial Orders;/Footnote5/
o develop a procedure for verifying that exports of certain items are
at their intended destinations; and
o develop procedures for screening against Commerce's most current
entities list, which provides notice of license requirements for
certain end users when there is an unacceptable risk that the commodity
or technology may be diverted.
NASA has taken steps to implement these recommendations. While Commerce
noted that NASA does not have a formal procedure in place to ensure that
products are being used by the intended entity and for the intended
purpose, it did not make recommendations regarding this point. NASA's
procedures developed in response to Commerce's review focus on verifying
that exports of certain items are at their intended destinations.
Ascertaining that usage is as intended is not addressed.
Johnson Space Center Internal Audits
------------------------------------
NASA's export control program requires the agency's centers to conduct
annual audits of their export control practices and submit a report
describing the review process, audit results, and any recommendations to
NASA headquarters. However, such audits have not always been conducted in
a comprehensive and rigorous manner. NASA's OIG found during a 1999 review
of NASA's export control program that though a significant portion of
Johnson Space Center exports related to the ISS, the Center's auditor did
not review ISS exports. Moreover, we found that the Center's 1997 and 1998
annual audit reports were not sufficiently detailed to provide NASA
headquarters with sufficient information to assess the effectiveness of
the agency's export control practices. Center auditors documented their
reviews for fiscal years 1997 and 1998 by using a checklist-the NASA
Export Control Program Audit Module-that included general questions
requiring yes or no answers. Accompanying written reports, which were
supposed to include a description of the review process, the audit
results, and recommendations, were not prepared as required. Rather, the
Center auditors forwarded only the completed checklists, with limited
added detail, to the headquarters export administrator. For example, the
checklists for 1997 and 1998 included a yes answer in response to a
question regarding whether Commerce Export Administration Regulations'
record-keeping requirements were being followed. However, they did not
explain how the auditors reached this determination, nor did they include
any comments or recommendations on this issue. NASA guidance requires
auditors to verify, through sampling, that required screening and
licensing procedures are regularly followed and that required documents
are maintained in compliance with Commerce's Export Administration
Regulations. In commenting on a draft of this report, Commerce pointed out
that the special comprehensive license also requires that NASA conduct a
complete system review and not simply compare its procedures to an audit
checklist.
Agencywide Self-Assessment of Transfer/Export Control Practices
---------------------------------------------------------------
In December 1998, NASA initiated an assessment of its export control
program to determine whether its technology transfer and export control
procedures were thorough, rigorous, and provided for fully safeguarding
controlled goods and technologies, particularly in its international
partnerships and programs. NASA required managers and employees at various
organizational levels to complete a questionnaire designed to assess
technology controls in their areas of responsibility. Consolidation of all
assessments is under way, and NASA's centers will be briefed on results.
NASA officials told us that NASA has no plans to conduct a similar
agencywide self-assessment in the future on a regularly scheduled basis.
NASA requested feedback on its three-part questionnaire from (1) NASA
Enterprise directors, (2) center directors, and (3) center managers that
direct projects involving international participation. We examined the
assessments completed by the Human Exploration and Development of Space
Enterprise, the Johnson Space Center, and the ISS program office since
these entities are the most likely to be involved with ISS technology
transfers. While the responses about the effectiveness of the
implementation of NASA's export control program were generally favorable,
Johnson Space Center and ISS program office assessments cited a lack of
adequate staff for export control matters. In particular, the assessments
determined that additional personnel were needed for the time critical
export classification process. The ISS program office assessment indicated
that export control personnel were working with Johnson Space Center
management to increase the number of personnel involved.
Conclusions
NASA's internal audits at the Johnson Space Center have not been
comprehensive or detailed enough to judge the effectiveness of NASA's
export control program or compliance with export control laws and
regulations. The reports of audit lack evidence of audit work focused
specifically on ISS exports and do not include detailed information on
audit methods, findings, and recommendations as required by the agency's
export control program. Since NASA has no plans to conduct the agencywide
self-assessment on a regular basis, making the Johnson Space Center's
audit more useful takes on added urgency.
Recommendation
To enhance NASA's ability to oversee and implement its export controls of
ISS-related technologies, we recommend that the NASA Administrator ensure
that center-based audits are completed with sufficient detail to enable
the agency to identify weaknesses in NASA's export control procedures.
Agency Comments and Our Evaluation
NASA reviewed a draft of this report and stated that the report captured
the many facets of export control related to the ISS Program. NASA did not
explicitly state whether it agreed or disagreed with our recommendation.
NASA also provided technical comments to further clarify understanding of
some issues and suggested revisions that we have incorporated where
appropriate.
NASA's written comments are presented in appendix III.
We also provided drafts of this report to the Departments of Commerce and
State. We did not receive a written response from State. However, a State
official indicated the agency concurred with the report. Commerce provided
written comments, stating that the report is accurate (see app. IV). Both
State and Commerce provided technical suggestions for clarification
purposes that we incorporated where appropriate.
Scope and Methodology
To determine the number and types of ISS-related licenses issued in
conjunction with the ISS Program and the destination of technology and
commodities exported to date, we compared export license records
maintained by NASA headquarters with Commerce's Export Control Automated
Support System database. Our comparison included ISS-related licenses that
Commerce issued between fiscal year 1994 and the first quarter of fiscal
year 1998. We also reviewed program office listings of ISS-related items
it exported without licenses. To obtain information on the status of
encryption exports, we reviewed NASA records and held discussions with
NASA officials about requirements for such exports and countries of
destination.
To determine the results of past reviews of NASA's export control program,
we reviewed audit reports conducted by NASA's OIG and Commerce and the
results of a NASA investigation of radiation-hardened electronic parts. We
also reviewed the methodology and results of recent internal audits of
export control practices conducted by NASA's Johnson Space Center. We
assessed NASA's responsiveness to audit recommendations by discussing
follow-up actions with NASA officials and documenting changes in NASA's
policies and procedures.
We conducted our review from September 1998 through September 1999 in
accordance with generally accepted government auditing standards.
Unless you publicly announce its contents earlier, we plan no further
distribution of this report until 14 days from its issue date. At that
time, we will send copies to the Honorable Daniel S. Goldin, NASA
Administrator; the Honorable Madeleine Albright, Secretary of State; the
Honorable William M. Daley, Secretary of Commerce; the Honorable Jacob
Lew, Director of the Office of Management and Budget; and other interested
parties. We will also make copies available to others upon request.
If you or your staff have any questions concerning this report, please
contact me on (202) 512-4841. Key contributors to this assignment were
Jerry Herley, Samuel Cox, and Shirley Johnson.
*****************
*****************
Allen Li
Associate Director
Defense Acquisitions Issues
--------------------------------------
/Footnote1/-^ The 16 countries are the United States, as lead partner;
Canada; Japan; the European countries Belgium, Denmark, France, Italy,
Germany, the Netherlands, Norway, Spain, Sweden, Switzerland, and the
United Kingdom; Russia; and Brazil.
/Footnote2/-^ An Individual Validated License is a written authorization
from the government to export. After a license application is approved,
a license is issued by Commerce bearing the license number and
validation date. The license will generally be valid for a 24-month
period.
/Footnote3/-^ The Export Administration Act (50 U.S.C. app. 2401, as
amended) has expired. However, Commerce carries out the Export
Administration Regulations pursuant to an executive order issued under
the President's authority in the International Emergency Powers Act. The
Arms Export Control Act (22 U.S.C. 2778, as amended) authorizes the
President to control the export and import of defense articles and
services. The authority to issue regulations with respect to export of
defense articles and services was delegated to the Secretary of State by
Executive Order 11958.
/Footnote4/-^ NASA verified its internal process of effecting an export
under the authority of the ISS special comprehensive license in
conjunction with the export of an electrical power system to its
Japanese partner. The item was returned within 30 days.
/Footnote5/-^ Former terminology for Denied Persons List.
COMMODITIES EXPORTED USING INDIVIDUAL VALIDATED LICENSES
========================================================
------------------------------------------------------------------------
| Licenses : Description : Destination |
|----------------------------------------------------------------------|
| 1a : Circuit emulator, : Russia |
| : International Space Station : |
| : system bus upgrade, : |
| : multiplexer/demultiplexer : |
| : (MDM) : |
|----------------------------------------------------------------------|
| Amendment : Circuit emulator, ISS system : Russia |
| : bus upgrade, MDM : |
|----------------------------------------------------------------------|
| Amendment : Electronics equipment : Russia |
| : connectors : |
|----------------------------------------------------------------------|
| Amendment : Prototype and flight MDM, : Russia |
| : field-testing equipment, and : |
| : cable kits : |
|----------------------------------------------------------------------|
| Amendment : Prototype MDMs : Russia |
|----------------------------------------------------------------------|
| Amendment : MDMs for payload blocks, : Russia |
| : command and control, : |
| : navigation and guidance, and : |
| : testing; connectors; test : |
| : processors; and memory cards : |
|----------------------------------------------------------------------|
| Amendment : Microswitches, MDM spare : Russia |
| : prototype, functional : |
| : equivalent, and flight : |
| : circuit boards : |
|----------------------------------------------------------------------|
| 2 : Connectors, MDM prototypes : Russia |
| : and circuit boards, spare : |
| : circuit boards, flight : |
| : enhanced MDMs, and flight : |
| : stand : |
|----------------------------------------------------------------------|
| 3 : Random Access Memory (RAM) : Russia |
| : and optical couplers for : |
| : developmental and flight : |
| : stages : |
|----------------------------------------------------------------------|
| 4 : Synchronous RAM : Russia |
|----------------------------------------------------------------------|
| 5 : Microcircuit optical coupler : Russia |
| : flight parts (radiation- : |
| : hardened) for service module : |
| : and functional energy block : |
| : matching unit requirements : |
|----------------------------------------------------------------------|
| 6 : Hewlett Packard optical : Russia |
| : coupler circuits : |
|----------------------------------------------------------------------|
| 7 : Hatch assembly kits, : Italy |
| : including hatches, tracks, : |
| : trusses, and roller assemblies: |
|----------------------------------------------------------------------|
| 8 : Institute of Electrical and : Germany |
| : Electronics Engineers : |
| : (Firewire) Ethernet : |
| : Hub/Gateway : |
|----------------------------------------------------------------------|
| 9 : Active and passive common : Italy |
| : berthing mechanism (CBM) : |
| : kits; CBM seal kits with : |
| : bold assemblies : |
------------------------------------------------------------------------
a As shown, license 1 was amended six times.
EXAMPLES OF ISS-RELATED COMMODITIES EXPORTED IN 1998 UNDER NO LICENSE
REQUIRED AUTHORITY
===========================================================================
------------------------------------------------------------------------
| Description : Destination |
|----------------------------------------------------------------------|
| Articulating portable foot : Canada |
| restraint for ISS : |
| extravehicular activity (EVA) : |
|----------------------------------------------------------------------|
| Seat track material to be used : Russia |
| for evaluating ISS designs and : |
| for interfacing with seat track : |
| anchors : |
|----------------------------------------------------------------------|
| Labels fabricated for National : Japan |
| Space Development Agency of : |
| Japan flight in support of the : |
| ISS : |
|----------------------------------------------------------------------|
| Protective caps to provide : Canada |
| cover for ISS EVA-installed : |
| communication cable connector : |
|----------------------------------------------------------------------|
| Cable, Russian degassing pumps : Russia |
| to support the Russian : |
| spacesuit unbiblical for : |
| flight/testing applications : |
|----------------------------------------------------------------------|
| Fans/hardware : Canada |
|----------------------------------------------------------------------|
| Bar code reader, laser : Russia |
|----------------------------------------------------------------------|
| Camera equipment (35-70 : Russia |
| millimeter f2.8D lens, Nikon) : |
| in support of Russian segment : |
| imagery : |
|----------------------------------------------------------------------|
| Terminal switching unit : Russia |
|----------------------------------------------------------------------|
| Smith press station for : Russia |
| training of ISS crews : |
|----------------------------------------------------------------------|
| 22-inch hand rails (class III) : Russia |
| for ISS EVA training : |
|----------------------------------------------------------------------|
| Russian simplified aid for EVA : Russia |
| rescue mockup : |
|----------------------------------------------------------------------|
| Ammonium persulfate reservoir : Russia |
| and acid reservoirs : |
|----------------------------------------------------------------------|
| Laptop computer : Russia |
|----------------------------------------------------------------------|
| Microfixtures : Canada |
|----------------------------------------------------------------------|
| On-board spacesuit control : Russia |
| assembly : |
------------------------------------------------------------------------
COMMENTS FROM THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
===============================================================
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The following are GAO's comments on the National Aeronautics and Space
Administration's (NASA) letter dated September 29, 1999.
GAO Comments
1.We do not agree that the statement "NASA had no formalized export
control policy when the International Space Station (ISS) Program
began" is misleading. However, we have revised the text of the
report to provide additional explanation. We believe that our
report's background section accurately describes the status of
the NASA export control policy when the ISS Program began as well
as the current status of its export control plan for the ISS
Program.
2.In our opinion, the terminology "without license" is a more accurate
characterization of the information that will be included in the
database being developed.
3.We believe that our report accurately states that none of the items
on the bilateral exchange list are under State's export control
jurisdiction.
4.We have revised the text of the report to clarify this fact.
COMMENTS FROM THE DEPARTMENT OF COMMERCE
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GAO Comments
The following are GAO's comments on the Department of Commerce's letter
dated October 21, 1999.
1. We recognize that parties involved in the ISS Program have signed
Memorandums of Understanding (MOU). Signing these agreements is
recognition by the partners of their responsibility and obligation to
comply with the terms of the agreement. However, we believe a mechanism
that provides assurance that the partners are complying with the terms of
exports is a necessary step in NASA's implementation of its export control
policy. In our opinion, NASA's procedures for verifying that exports of
certain items are at their intended destinations do not provide adequate
assurance that the items are being used for the intended purpose.
(707379)
*** End of document. ***