Israel Plans to Loosen Defence Export Restrictions

Israeli companies need not obtain a marketing license for certain cyber and electro-optic systems and tools, and security and anti-terrorism warfare education, according to changes in the defence export policy proposed by the country’s Ministry of Defence (MoD).

The MoD will significantly shorten the list of products whose overseas marketing requires prior approval from the Defense Export Controls Agency (DECA). These concessions will apply to companies exporting to any of the 102 countries on the list of permitted countries, Globes newspaper reported.

DECA director Rachel Chen said Monday that the concessions would apply to marketing of products defined by the Ministry of Defense as unclassified, while marketing of products defined as classified would still require a license in advance.

Exports of defense systems currently required a two-stage licensing process: a marketing license was required before the system was presented at an exhibition or demonstration to a potential customer and at the end of the negotiations between the exporter and the customer of the supply of a system, an export license was required under the Defense Export Controls Law, Globes said.

The expected changes in the law are designed to make it easier for Rafael Advanced Defense Systems which has extensive business in electro-optics, and other defense companies, including Elbit Systems and Israel Aerospace Industries which have cyber activity, as well as hundreds of relatively small companies active in this sector.

The exemptions announced by Chen are projected to relieve the burden on the DECA which handles tens of thousands of requests for marketing and export licenses every year besides reducing the timelines of exporting companies. Currently, the procedures for obtaining a marketing license take an average of 120 days.

However, the MoD is planning to reserve the right to veto a deal, and ask the exporter to obtain an export license should it feel the exported item is of a classified nature.

Israeli defense exports totaled $5.6 billion in 2016, 14% more than in 2015. More than 35,000 requests for marketing systems and various weapons are submitted to the Defense Export Controls Agency annually, which grants 9,000 export licenses to defense companies, Globes added.

The full article can be read here:http://www.globes.co.il/en/article-defense-ministry-to-ease-export-restrictions-1001209800