The State Department filed a proposal entitled Amendment to the International Traffic in Arms Regulations: Replacement Parts/Components and Incorporated Articles Notice of Proposed Rulemaking, 76 Fed. Reg. 76 Fed. Reg. 13928 (March 15, 2011). The proposal was offered for public comment and MARPA filed comments in response to the Sate Department proposal.
The State Department has proposed to exempt from the State Department’s ITAR export licensing requirements certain parts and components that are sent as replacements for an end unit that was previously legally exported. The proposed update of ITAR part 123 would specifically permit companies to export parts without a license as long as “[t]he exporter was the applicant of a previously approved authorization to export the U.S.-origin end-item.”
The proposed exemption would permit original equipment manufacturers (OEMs), but not aftermarket component manufacturers, to sell and export replacement parts without obtaining a license. The failure to account for all market participants would reduce the competitiveness of the industry as a whole. As a consequence, the proposed rule negatively impacts distributors by creating unequal burdens on U.S. exporters.
MARPA filed comments asking the State Department to level the playing field, and treat all similarly-situated exporters to the same licensing standards.