(d) On or before November 15 of each year, the President shall transmit to the Speaker of the House of Representatives and the chairman of the Committee on Foreign Relations of the Senate the Arms Sales Proposal covering all sales under this Act (other than sales to members of the North Atlantic Treaty Organization, Japan, Australia, and New Zealand) of major defense equipment for $7,000,000 or more, or of any other defense articles or defense services for $25,000,000 or more, which are considered eligible for approval during the fiscal year beginning on October 1 of such year.

SEC. 26.48 DEFENSE REQUIREMENT SURVEYS.-(a) The Congress finds that defense requirement surveys prepared by the United States for foreign countries have had a significant impact on subsequent military procurement decisions of those countries. It is the policy of the United States that the results of defense requirement surveys conducted by the United States clearly do not represent a commitment by the United States to provide any military equipment to any foreign country. Further, recommendations in such surveys should be consistent with the arms export control policy provided for in this Act.

(b) As part of the quarterly report required by section 36(a) of this Act, the President shall include a list of all defense requirement surveys authorized during the preceding calendar quarter, specifying the country with respect to which the survey was or will be conducted, the purpose of the survey, and the number of United States Government personnel who participated or will participate in the survey.

(c) Upon a request of the chairman of the Committee on International Relations of the House of Representatives or the chairman of the Committee on Foreign Relations of the Senate, the President shall grant that committee access to defense requirement surveys conducted by United States Government personnel.

LITA

Chapter 3-MILITARY EXPORT CONTROLS

SEC. 31.49 AUTHORIZATION AND AGGREGATE CEILING ON FOREIGN MILITARY SALES CREDITS.— (a) There is hereby authorized to be appropriated to the President to carry out this Act $682,000,000 for the fiscal year 1978 and $674,300,000 for the fiscal year 1979." Unobligated balances of funds made available pursuant to this section are hereby authorized to be continued available by appropriations legislation to carry out this Act.

(b) 51 The aggregate total of credits, or participations in credits, extended pursuant to this Act and of the principal amount of loans guaranteed pursuant to section 24(a) shall not exceed $2,152,350,000, for the fiscal year 1978 and $2,085,500,000 for the fiscal year 1979, of

47 Subsection (d) was added by Sec. 18(a) of the International Security Assistance Act of 1978 (92 Stat. 740).

48 22 USC 2765. Sec. 26 was added by Sec. 19 of the International Security Assistance Act of 1978 (92 Stat. 740).

49 22 USC 2771.

50 Sec. 20(a) of the International Security Assistance Act of 1978 (92 Stat. 741) added the figure for fiscal year 1979 and increased the fiscal year 1978 figure from $677,000,000 to $682,000,000. Past figures authorized under Sec. 31(a) are as follows: Fiscal year 1969$269,000,000; Fiscal year 1970-$250,000,000; Fiscal year 1971-$250,000,000; Fiscal year 1972 $400,000,000: Fiscal year 1974-$325,000,000; Fiscal year 1975-$1,039,000,000; Fiscal year 1977-$740,000,000.

FA Appropriations Act. 1979 states:

"For expenses not otherwise provided for, necessary to enable the President to carry out the provisions of sections 23 and 24 of the Arms Export Control Act, $654,500,000: Provided, That of the amount provided for the total aggregate credit sale ceiling during the current fiscal year, not less than $1,000,000,000 shall be allocated to Israel."

51 Sec. 210(b) of the International Security Assistance and Arms Export Control Act of 1976 amended Subsection (b) which formerly read as follows: (Cont.)

which amount for each such year not less than $1,000,000,000 shall be available only for Israel.52

(c) 53 Funds made available for the fiscal year 1979 under subsection (a) of this section shall be obligated to finance the procurement of defense articles and defense services by Israel on a longterm repayment basis either by the extension of credits, without regard to the limitation contained in section 23, or by the issuance of guaranties under section 24. Repayment shall be in not less than twenty years, following a grace period of ten years on repayment of principal. Israel shall be released from one-half of its contractual liability to repay the United States Government with respect to defense articles and defense services so financed for such year.

(d) The aggregate acquisition cost to the United States of excess defense articles ordered by the President in any fiscal year after fiscal year 1976 for delivery to foreign countries or international organizations under the authority of chapter 2 of part II of the Foreign Assistance Act of 1961 or pursuant to sales under this Act may not exceed $150,000,000 54 (exclusive of ships and their on-board stores and supplies transferred in accordance with law).

SEC. 32.55 PROHIBITION AGAINST CERTAIN MILITARY EXPORT FINANCING BY EXPORT-IMPORT BANK.-Notwithstanding any other provision of law, no funds or borrowing authority available to the Export-Import Bank of the United States shall be used by such Bank to participate in any extension of credit in connection with any agreement to sell defense articles and defense services entered into with any economically less developed country after June 30, 1968.

SEC. 33.56 REGIONAL CEILINGS ON FOREIGN MILITARY SALES.-(a) 57 58 The aggregate of the total amount of military assistance pursuant to the Foreign Assistance Act of 1961, as amended,59 of credits, or participations in credits, financed pursuant to section 23, of the principal amount of loans guaranteed pursuant to section 24 (a),oo shall, exclud

60

"(b) The aggregate total of credits, or participation in credits, extended pursuant to this Act and of the principal amount of loans guaranteed pursuant to section 24 (a) shall not exceed $872,500,000 for the fiscal year 1975 of which amount not less than $300,000,000 shall be available to Israel only. Of the funds made available under subsection (a) of this section, $100,000,000 shall first be obligated with respect to financing the procurement of defense articles and defense services by Israel under section 23 of this Act, except that Israel shall be released from contractual liability to repay the United States Government for the defense articles and defense services so financed."

62 Sec. 20 (b) of the International Security Assistance Act of 1978 (92 Stat. 741) added the figure for the fiscal year 1979 and increased the fiscal year 1978 figure from $2,105,350,000 to $2,152,350,000. Past amounts authorized under Sec. 31(b) are as follows: Fiscal year 1969 $296,000,000; Fiscal year 1970-$340,000.000; Fiscal year 1971$340,000,000; Fiscal year 1972-$550,000,000; Fiscal year 1974-$730,000,000; Fiscal year 1975 $872,500,000; Fiscal year 1976-2,374,700,000; Fiscal year 1977$2,022,100,000.

Subsections (c) and (d) were added by Sec. 210 (c) (1) of the International Security Assistance and Arms Export Control Act of 1976. The reference to fiscal year 1979 was added by Sec. 20 (c) of the International Security Assistance Act of 1978 (92 Stat. 741). This figure was increased from $100,000,000 by Sec. 20(d) of the International Security Assistance Act of 1978 (92 Stat. 741).

55 22 USC 2772.

5 22 USC 2773.

57 Sec. 45(a) (8) (A) of the FAAct of 1974 repealed former subsection (a) which read as follows: "(a) The aggregate of the total amount of military assistance pursuant to the Foreign Assistance Act of 1961, as amended, of credits, or participation in credits. financed pursuant to section 23 of the principal amount of loans guaranteed pursuant to section 24(a), and loans and sales in accordance with section 7307 of title 10, United States Code, shall, excluding training, not exceed $150,000,000 in each fiscal year for Latin American countries."

Sec. 45 (a) (8) (B) of the FAAct of 1974 redesignated subsection (b) as subsection (a). The words "of cash sales pursuant to sections 21 and 22," which appeared at this point, were struck out by Sec. 25(8) (A) of the FAAct of 1973.

The words "of the principal amount of loans guaranteed pursuant to section 24(a)" were substituted in lieu of "(excluding credits covered by guarantles issued pursuant to section 24(b)) of the face amount of contracts of guaranty issued pursuant to sections 24 (a) and (b)" by Sec. 25 (8) (B) of the FAAct of 1973.

ing training, not exceed $40,000,000 in each fiscal year for African countries.

(b) The President may waive the limitations of this section when he determines it to be important to the security of the United States and promptly so reports to the Speaker of the House of Representatives and the Committee on Foreign Relations of the Senate.

62*** [Repealed-1973]

(c) 62

SEC. 34.69 FOREIGN MILITARY SALES CREDIT STANDARDS.-The President shall establish standards and criteria for credit and guaranty transactions under sections 23 and 24 in accordance with the foreign, national security, and financial policies of the United States.

SEC. 35.64 FOREIGN MILITARY SALES TO LESS DEVELOPED COUNTRIES.(a) When the President finds that any economically less developed country is diverting development assistance furnished pursuant to the Foreign Assistance Act of 1961, as amended, or sales under the Agricultural Trade Development and Assistance Act of 1954, as amended, to military expenditures, or is diverting its own resources to unnecessary military expenditures, to a degree which materially interferes with its development, such country shall be immediately ineligible for further sales and guarantees under sections 21, 22, 23, and 24, until the President is assured that such diversion will no longer take place. (b)65*** [Repealed-1974]

SEC. 36.6 66 REPORTS ON COMMERCIAL AND GOVERNMENTAL MILITARY

New subsection (b) was added by Sec. 45(a) (8) (C) of the FAAct of 1974. Subsection (c) which related to non-waiver of limitations of the section was repealed by Sec. 25 (9) of the FAAct of 1973.

63 22 USC 2774.

64 22 USC 2775.

65 Subsection (b) was repealed by Sec. 45 (a) (5) of the FAAct of 1974.

68 22 USC 2776, Sec. 211 (a) of the International Security Assistance and Arms Export Control Act of 1976 amended Sec. 36 which formerly read as follows:

"Sec. 36. Reports on Commercial and Governmental Military Exports.

(a) The President shall submit to the Speaker of the House of Representatives and to the chairman of the Committee on Foreign Relations of the Senate quarterly reports containing

(1) a listing of all letters of offer to sell any defense articles or services under this Act, if such offer has not been accepted or canceled;

(2) a cumulative listing of all such letters of offer to sell that have been accepted during the fiscal year in which such report is submitted;

(3) the cumulative dollar amounts, by foreign country and international organization, of credit sales under section 23 and guaranty agreements under section 24 made before the submission of such quarterly report and during the fiscal year in which such report is submitted; and

(4) projections of the cumulative dollar amounts, by foreign country and International organization, of credit sales under section 23 and guaranty agreements under section 24 to be made in the quarter of the fiscal year immediately following the quarter for which such report is submitted.

For each letter of offer to sell under paragraphs (1) and (2), the report shall specify (A) the foreign country or international organization to which the defense article or serv ice is offered, (B) the dollar amount of the offer to sell under paragraph (1) or of the completed sale under paragraph (2), (C) a brief description of the defense article or service offered. (D) the United States armed force which is making the offer to sell, (E) the date of such offer, and (F) the date of any acceptance under paragraph (2).

(b) In the case of any letter of offer to sell any defense articles or services under this Act for $25,000,000 or more, before issuing such letter of offer the President shall submit to the Speaker of the House of Representatives and to the Chairman of the Committee on Foreign Relations of the Senate a statement with respect to such offer to sell containing the information specified in subparagraphs (A) through (E) in subsection (a). The letter of offer shall not be issued if the Congress, within twenty calendar days after receiving any such statement, adopts a concurrent resolution stating in effect that it objects to such proposed sale, unless the President in his statement certifies that an emergency exists which requires such sale in the national security interests of the United States. (c) Nothing in this section shall be construed as modifying in any way the provisions of section 414 of the Mutual Security Act of 1954, as amended, relating to munitions control."

Sec. 211(b) of the same Act further stated: "The amendment made by subsection (a) of this section shall apply with respect to letters of offer for which a certification is transmitted pursuant to section 36(b) of the Arms Export Control Act on or after the date of enactment of this Act and to export licenses for which an application is filed under section 38 of such Act on or after such date."

EXPORTS; CONGRESSIONAL ACTION.-(a) The President shall transmit to the Speaker of the House of Representatives and to the chairman of the Committee on Foreign Relations of the Senate not more than thirty days after the end of each quarter an unclassified report (except that any material which was transmitted in classified form under subsection (b) (1) or (c)(1) of this section may be contained in a classified addendum to such report, and any letter of offer referred to in paragraph (1) of this subsection may be listed in such addendum unless such letter of offer has been the subject of an unclassified certification pursuant to subsection (b) (1) of this section) containing

(1) a listing of all letters of offer to sell any major defense equipment for $1,000,000 or more under this Act to each foreign country and international organization, by category, if such letters of offer have not been accepted or cancelled;

(2) a listing of all such letters of offer that have been accepted during the fiscal year in which such report is submitted, together with the total value of all defense articles and defense services sold to each foreign country and international organization during such fiscal year;

(3) the cumulative dollar amounts, by foreign country and international organization, of sales credit agreements under section 23 and guaranty agreements under section 24 made during the fiscal year in which such report is submitted;

(4) a numbered listing of all licenses and approvals for the export to each foreign country and international organization during such fiscal year of commercially sold major defense equinment, by category, sold for $1,000,000 or more, together with the total value of all defense articles and defense services so licensed for each foreign country and international organization, setting forth, with respect to the listed major defense equipment

(A) the items to be exported under the license,

(B) the quantity and contract price of each such item to be furnished, and

(C) the name and address of the ultimate user of each such item;

(5) projections of the dollar amounts, by foreign country and international organization, of cash sales expected to be made under sections 21 and 22, credits to be extended under section 23, and guaranty agreements to be made under section 24 in the quarter of the fiscal year immediately following the quarter for which such report is submitted;

(6) a projection with respect to all cash sales expected to be made and credits expected to be extended to each country and organization for the remainder of the fiscal year in which such report is transmitted;

(7) an estimate of the number of officers and employees of the United States Government and of United States civilian contract personnel present in each such country at the end of that quarter for assignments in implementation of sales and commercial exports under this Act;

(8)67 a description of each payment, contribution, gift, com

67 Sec. 604 (a) of the International Security Assistance and Arms Export Control Act of 1976 redesignated paragraph (8) as paragraph (9) and inserted a new paragraph (8) immediately after paragraph (7). Sec. 604 (c) of the same Act stated that paragraph (8) would "take effect sixty days after the date of enactment of this Act." (1.e. August 29,

36-588 - 79-19

mission, or fee reported to the Secretary of State under section 39, including (A) the name of the person who made such payment, contribution, gift, commission, or fee; (B) the name of any sales agent or other person to whom such payment, contribution, gift, commission, or fee was paid; (C) the date and amount of such payment, contribution, gift, commission, or fee; (D) a description of the sale in connection with which such payment, contribution, gift, commission, or fee was paid; and (E) the identification of any business information considered confidential by the person submitting it which is included in the report; and

67

(9) an analysis and description of the services being performed by officers and employees of the United States Government under section 21 (a) of this Act, including the number of personnel so employed.

For each letter of offer to sell under paragraphs (1) and (2), the report shall specify (i) the foreign country or international organization to which the defense article or service is offered or was sold, as the case may be: (ii) the dollar amount of the offer to sell or the sale and the number of defense articles offered or sold, as the case may be; (iii) a description of the defense article or service offered or sold, as the case may be; and (iv) the United States Armed Forces or other agency of the United States which is making the offer to sell or the sale, as the case may be.

(b) (1) In the case of any letter of offer to sell any defense articles or services under this Act for $25,000,000 or more, or any major defense equipment for $7,000,000 or more, before such letter of offer is issued, the President shall submit to the Speaker of the House of Representatives and to the chairman of the Committee on Foreign Relations of the Senate a numbered certification with respect to such offer to sell containing the information specified in clauses (i) through (iv) of subsection (a) and a description, containing the information specified in paragraph (8) of subsection (a), of any contribution, gift, commission, or fee paid or offered or agreed to be paid in order to solicit, promote, or otherwise to secure such letter of offer. In addition, the President shall, upon the request of such committee or the Committee on International Relations of the House of Representatives, transmit promptly to both such committees a statement setting forth, to the extent specified in such request

(A) a detailed description of the defense articles or services to be offered, including a brief description of the capabilities of any defense article to be offered;

(B) an estimate of the number of officers and employees of the United States Government and of United States civilian contract personnel expected to be needed in such country to carry out the proposed sale;

(C) the name of each contractor expected to provide the defense article or defense service proposed to be sold (if known on the date of transmittal of such statement);

(D) 68 an evaluation, prepared by the Director of the Arms Control and Disarmament Agency in consultation with the Secretary

68 Subparagraph (D) was amended and restated by Sec. 21(1) of the International Security Assistance Act of 1978 (92 Stat. 741). It formerly read as follows: "(D) an analysis of the arms control impact pertinent to such offer to sell, prepared in consultation with the Secretary of Defense ;",