THAILAND CONSORTIUM ON TRADE CONTROL ON WEAPONS OF MASS DESTRUCTION-RELATED ITEMS
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1 THAILAND CONSORTIUM ON TRADE CONTROL ON WEAPONS OF MASS DESTRUCTION-RELATED ITEMS Bangkok, July 2017 Now and Beyond: Multilateral Export Control Regimes: The Wassenaar Arrangement Ambassador Philip Griffiths Head of Secretariat, Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies Introduction I congratulate the Department of Foreign Trade of the Ministry of Commerce of Thailand on this important event and am honoured to be one of the keynote speakers today. Although the Wassenaar Arrangement (WA) is focused on export controls for conventional arms rather than on weapons of mass destruction (WMD), it also covers transfers of sensitive dual-use goods and technologies, which may be relevant to WMD as well as to conventional weapons programmes. Indeed, the WA Dual-Use Control List is extensive compared with those of other export control regimes dealing with WMD and their means of delivery from whom we will also be hearing in this session. For most countries, the WA Dual-Use List comprises the vast majority of export licence applications received. This morning I propose to give a brief overview of the WA and its work, highlighting some recent outcomes as well as challenges. Upon joining, WA Participating States make a political commitment to promote transparency and responsibility in transfers of conventional arms and sensitive dual-use goods and technologies in order to prevent destabilizing accumulations or military buildups in regions of conflict or concern. They undertake, through their national policies, to ensure that transfers of these items do not contribute to the development or enhancement of military capabilities that undermine regional and international security and stability, and are not diverted to support such capabilities. They also work to prevent the acquisition of these items by terrorists. Page 1 of 8
2 The WA operates by consensus and is open on a global and non-discriminatory basis to prospective members who meet the agreed criteria and whose admission is approved by the WA Plenary. In essence, the WA can be seen as an intergovernmental information-sharing and standard-setting forum. A balance between collective agreement on key principles and standards and national discretion in implementation of all measures with respect to the WA is a fundamental characteristic of its work. All decisions, whether to grant an export licence for a particular item to a particular destination, or to deny an application, are taken by each Participating State in accordance with its national legislation and policies. At the same time, the WA provides for an element of "peer review" - any Participating State, if it wishes, may follow up by seeking further discussion, in the WA forum or bilaterally, as to the rationale behind a particular national decision. Background When it was established in 1996, the WA was the first global multilateral arrangement in this field. From 33 founding members, it has expanded to currently 41 Participating States from all continents, among them major producers and exporters of the items in question. Several countries have applied to join the WA, while an increasing number of countries, including in the Asian region, are among the WA's regular outreach partners. Some countries opt to apply the WA Control Lists without seeking to become a member. They may do this directly, or by voluntarily following the consolidated European Union (EU) Control Lists, which are based on the work of the WA and the other export control regimes. This practice is followed by several countries in the South-East Asian region. The WA complements, without seeking to duplicate, the other export control regimes represented here. While the specific focus in each case differs, the underlying principle is similar. Multilateral cooperation in promoting effective export controls on strategic items, based on vigilance and restraint, contributes to security at all levels by helping to prevent sensitive goods and technologies from falling into the wrong hands. Effective export controls can also be seen as supporting a country's economic interests by facilitating trade, building confidence and enhancing access to sensitive imports and Page 2 of 8
3 foreign direct investment. WA members go to considerable lengths to ensure that their work does not impede bona fide civil transactions. Conventional arms are currently used with the most devastating consequences around the world, especially small arms and light weapons (SALW), which are also the weapons of choice of terrorists. Increasing recognition of the need to regulate the global arms trade has been reflected in broad-based international support for the Arms Trade Treaty (ATT), which I will come back to later. Interest in the WA and its work continues to grow in this context. The WA's publicly available outputs may be seen as a useful reference or resource for countries which are building or strengthening their export control systems. The WA's work is concentrated in three key areas maintaining the collectively agreed Control Lists of items that require a national export licence; exchanging information on transfer risks and reporting of national decisions to approve or deny transfers of controlled items outside the WA; and developing non-binding guidance to assist governments and exporters in effective export control implementation. Control Lists The WA Control Lists comprise: The Munitions List, with close to 300 entries in 22 categories, covering all types of conventional arms, as well as ammunition, parts and components, related production equipment, technology and software; and The Dual-Use List, with over 1,000 items in 9 categories, ranging from special materials and related equipment to electronics, computers, telecommunications, information security, sensors and lasers, navigation and avionics, marine, aerospace and propulsion. Of these, 170 items are classified as "sensitive" and 80 as "very sensitive", requiring a more vigilant approach. The Dual-Use List covers goods and technologies which are produced for civilian use but which may also have military applications, including in the production of arms. A "catch all" principle, agreed by the WA in 2003, provides for the control of dual-use items which are not included in the Lists when they are intended for destinations that are Page 3 of 8
4 subject to UN or other binding arms embargoes, and are intended entirely or in part for military end-use, including for the manufacture or repair of military equipment. Other licensing requirements may be applied at the national level going beyond what is agreed in the WA. To remain relevant, export control lists need to be constantly updated. WA members invest considerable resources in this ongoing work. The group of Participating State technical experts meets for on average six weeks a year to consider possible additions to, modifications of, or deletions from the WA Control Lists in order to stay in step with technological developments and changes in the international security situation, taking into account market trends. WA members may involve industry experts in this specialised work. The entry specifications need to be set precisely to focus licensing decisions on items of security concern while allowing other items to be traded freely. Once the annual Control List changes are approved by the WA Plenary each December, they are published on the WA website and WA Participating States, and an increasing number of other countries, incorporate them into their national regulations and procedures as appropriate. In terms of recent Control List changes, since the WA has agreed on new export controls related to, for example, mobile communications interception, intrusion software and Internet network surveillance tools which, under certain conditions, may be detrimental to international and regional security and stability. In 2014, new export controls were agreed in areas such as spacecraft equipment, to take account of items and technologies of concern that are increasingly available on the open market. Controls relating to machine tools were substantially revised, and technical parameters for Unmanned Aerial Vehicles (UAVs) were further refined, to better differentiate UAVs of concern from those used for commercial or recreational purposes, taking into account substantial technological progress in this area. And a definition of "de-activated firearms" was added to clarify that these firearms require a complete technical deactivation process in order to be considered harmless. In 2015, several new controls were adopted, while some existing controls were further clarified and other controls were relaxed, such as for specific types of machine tools and Page 4 of 8
5 computers, technologies used in consumer industries (e.g. for car production, domestic medical devices), optical mirrors for solar power stations, battery cells, underwater still cameras and equipment incorporating information security. In many cases, such changes recognized the very rapid development of electronics using information security for consumer protection. In 2016, several new export controls were adopted, while existing controls were further clarified regarding, for example, information security and the concept and use of "technology". Some controls were relaxed, such as for lasers used in industry, as well as for digital computers and voice-coding equipment. In such cases, performance thresholds were updated taking into account the rapidly evolving performance of civil market products. This year, based on national proposals, WA experts are continuing core work in further refining understandings in relation to cyber issues, electronic forensics equipment, 3-D printing, thermal batteries and terrestrial equipment for satellites. Looking ahead, it can be expected that the WA will continue to provide a forum for addressing new technologies of security concern, including advanced sensors, robots and artificial intelligence, as well as for keeping sensitive item specifications up-to-date and relevant. Information Exchange Turning to other areas of the WA's work, what is called a general information exchange is designed to focus at least three times a year on transfer risks in specific regions, suspicious acquisition/brokering activities, projects and programmes of concern, as well as terrorismrelated issues. This is a kind of a kind of collective risk assessment bringing together perspectives from different parts of the world, with the aim of developing common understandings of the risks and concerns associated with the transfer of listed items, including the risk of destabilising accumulations and the risk of diversion, and in order to assess the scope for coordinating national export control policies in response. In practice, an individual Participating State may draw the attention of its partners to any matter that it considers relevant to achieving the WA's purposes. Specific information shared includes regular reporting of Participating States' conventional arms transfers and transfers and denials of certain dual-use goods and technologies to Page 5 of 8
6 destinations outside the WA, with the aim of promoting transparency and consistency. WA arms transfer notifications are submitted more frequently (i.e. twice per year) and include more information than is required under the UN reporting system and the ATT. Reporting of transfer denials brings to the attention of partners efforts to obtain access to a controlled item or technology that one Participating State considers to be contrary to the WA's purposes. Such reporting is therefore an important and timely warning mechanism that also helps to avoid inadvertent undercuts. In addition, WA Participating State licensing and enforcement officers come together once a year and network intersessionally to share national export control implementation experiences, including case studies and practical lessons learned. Information-exchange is facilitated through the WA s dedicated secure electronic network (WAIS), to which all Participating States have 24-hour access. Standard-Setting Work The WA's third area of focus, as I see it, lies in its standard-setting work. WA Participating States have agreed to collaborate in producing export control implementation guidance drawing on their practical experience. Over the years the WA has built up a comprehensive library of some 25 non-binding best practices, elements and procedures for effective export control implementation. These guidelines relate to such issues as re-export controls for conventional weapons systems, end-user/end-use controls for military list equipment, catch-all, intangible technology transfer controls, internal compliance programmes (ICPs) for industry and the research sector, and transit or trans-shipment, among others. Last year, updates were approved of earlier Best Practice Guidelines on Brokering and on Effective Export Control Enforcement, while a procedure was agreed for the regular review and, where appropriate, updating of all existing guidance documents. Other WA Work in 2016 At their latest Plenary meeting in December 2016, WA Participating States continued to discuss ways of enhancing their information-sharing, paying particular attention to Page 6 of 8
7 proliferation risks related to small arms and light weapons (SALW), as well as means to strengthen export control implementation, including in the fight against terrorism. They also reaffirmed the priority of outreach activities to non-member countries to encourage voluntary adherence to the WA's standards. They adopted new internal guidelines to steer future outreach activities, including annual collective policy and technical briefings, as well as bilateral dialogue (visits/meetings) with interested nonmember states. On the technical side, they agreed to continue informal contacts with the Nuclear Suppliers Group (NSG) and the Missile Technology Control Regime (MTCR) on specific Control List issues to better understand respective concerns, share technical expertise and avoid duplication; and, with regard to the ATT, they asked the WA Secretariat to continue to monitor opportunities for the WA to contribute to international cooperation. Also in 2016, WA Participating States conducted a fifth comprehensive assessment of the Arrangement's functioning, and marked the twentieth anniversary of its establishment. A number of special activities were undertaken, including a two-day technically focused Practical Workshop for an expanded group of outreach partners, as well as the issuing of additional outreach materials, such as a stand-alone WA Munitions List and a thematically arranged Compendium of WA Best Practice Documents, to promote their broader use. Arms Trade Treaty (ATT) A word about the ATT. WA Participating States welcomed the ATT's adoption in 2013 and noted an alignment in the respective goals as well as the availability of their collective experience and expertise. I believe that the ATT and the WA will continue to be seen as complementary and mutually reinforcing. It seems logical that the WA's accumulated work, including its Munitions List and the implementation guidelines and best practices, may be useful for other countries in meeting their ATT commitments. For their part, WA Participating States can be expected to wish to continue using the WA to further develop export control standards and enhance their implementation, thereby seeking to lead by example for the broader international community. Conclusion In summary, the importance of effective national export controls and of multilateral Page 7 of 8
8 cooperation continues to be reinforced by current security challenges related to destabilizing accumulations of conventional arms, regional conflicts and the proliferation and diversion of increasingly sophisticated strategic goods and technologies to non-state actors, including terrorists. Working together with one's partners sharing a similar commitment to vigilance and restraint builds confidence, supports security and helps to create a level playing-field for international trade. Raising awareness in the private sector and promoting cooperation, including self-regulation, is also an integral part of implementing robust export controls. Active outreach to other countries and relevant international and regional organisations is also important to success. In the 20 years since the WA was established, warfare and instability associated with conventional military threats have not gone away. Other challenges have grown in importance related to rapid technological advances, many driven by the civilian sector, as well as increasingly sophisticated proliferation and diversion risks, including through ITT. In order to play a stabilising role in the global trade and security environment, the Wassenaar Arrangement needs to continue to be able to respond rapidly and coherently to this evolving international threat landscape. I believe that, notwithstanding the challenges, WA Participating States can be expected to continue working hard to ensure that the WA remains well-placed to contribute, alongside other multilateral instruments, to international cooperation to address the risks related to transfers of conventional arms and related strategic items, without impeding legitimate trade. Let me recall that the WA public website contains all the key WA documents, including the latest Munitions and Dual-Use Control Lists, and the Best Practices Guidelines. In conclusion, I would be happy to provide further information or answer any specific questions. I look forward to further conversations on the margins of this event. Thank you for your attention. Page 8 of 8
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