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"Though we have acheived progress, our work is not over. That is why I support the mission of the Arms Control Association. It is, quite simply, the most effective and important organization working in the field today." 

– Larry Weiler
Former U.S.-Russian arms control negotiator
August 7, 2018
Australia Group

The Australia Group at a Glance

January 2018

Contact: Daryl Kimball, Executive Director, (202) 463-8270 x107

Updated: January 2018

Established in 1985, the Australia Group is a voluntary, informal, export-control arrangement through which 42 countries, as well as the European Union, coordinate their national export controls to limit the supply of chemicals and biological agents-as well as related equipment, technologies, and knowledge-to countries and nonstate entities suspected of pursuing chemical or biological weapons (CBW) capabilities.[1] All participants are members of the 1997 Chemical Weapons Convention (CWC) and the 1972 Biological Weapons Convention (BWC) and have stated that they view the Australia Group as a practical way to uphold the core purpose of these accords: preventing the spread of chemical and biological weapons.

Citing the use of chemical weapons during the Iran-Iraq war, the Australian government proposed creating the group in April 1985 as a means of uniting 15 countries that had independently established national controls on chemical weapons-related exports. At the first meeting in June 1985, the Australia Group initially focused on chemical weapons but by 1990 had extended its activities to include biological weapons. Although the group has traditionally aimed to prevent states from acquiring CBW-related materials, it decided at its June 2002 meeting to also address the flow of CBW capabilities to nonstate actors, such as terrorists.

The Australia Group establishes "control lists," and its members are expected to deny export license requests for items on the lists when there is a concern that the items might be used in a CBW program. Each year members meet in Paris to coordinate these export control policies, discuss possible revisions to the common control lists, and share intelligence about global CBW proliferation and export denials. The group has no charter or constitution, and each country uses its own discretion when implementing national export controls, relying on the group's lists as a baseline but often creating stricter controls than suggested by the group. Sensitive items on these control lists can be divided into five categories:

  • Chemical weapons precursors-chemicals used in the production of chemical weapons.
  • Dual-use chemical manufacturing facilities, equipment, and related technology-items that can be used either for civilian purposes or for chemical weapons production, such as reactors, storage tanks, pumps, and valves.
  • Biological agents-disease-causing microorganisms, whether natural or genetically modified, such as smallpox, Marburg, foot-and-mouth disease, and anthrax.
  • Toxins-poisonous substances either made by living organisms or produced synthetically that adversely affect humans, animals, or plants, such as botulinum toxin and ricin.
  • Dual-use biological equipment-items that can be used for both peaceful research and biological weapons production, such as fermenters, containment facilities, freeze-drying equipment, and aerosol testing chambers.

As with all other decisions, the Australia Group accepts new members only by consensus. Countries wishing to gain membership to the group must meet certain criteria, including proven compliance with the CWC and the BWC, and an established, effective national export control and enforcement mechanism for all the items on the group's control lists. In deciding whether to accept new members, each current member also weighs its willingness to share intelligence with the applicant country. Nonparticipating states complain that the criteria for membership are excessively strict and that denying a country membership implicitly accuses that applicant of pursuing chemical or biological weapons.

Nonmembers have also questioned the Australia Group's relationship to the CWC and BWC. Countries in the Non-Aligned Movement (NAM), for instance, have repeatedly asserted that they already made legally binding commitments not to acquire CBW by signing the biological and chemical weapons conventions, and that the Australia Group is at odds with the BWC provision for the "fullest possible technical exchange" for the advancement of peaceful scientific endeavors. Participants of the Australia Group, however, maintain that the group complements CWC and the BWC and serves the same goals. A U.S. State Department official explained that "the Australia Group offers another layer of control, but one-in the U.S.'s view-that is consistent with the U.S.'s obligations under the chemical and biological weapons treaties."[2]

At their June 2002 meeting, the members unanimously decided to adopt a set of formal, but not legally binding, guidelines outlining criteria for evaluating export requests and reaffirming the value of sharing intelligence about CBW proliferation. The two key provisions in these guidelines were a "no undercut" agreement and a "catch all" requirement. In the no-undercut provision, members pledged not to approve a particular export to a specific country that another member had previously denied without first consulting with that member. The catch-all provision requires member countries to be able to halt the transfer of any export, regardless of whether it appears on the group's control lists, if an importer might use it in a chemical or biological weapons program. This provision further stipulates that exporters in member states notify their governments if they suspect that an importer intends to use any import for CBW development.

In response to heightened concerns about chemical and biological terrorism, the group also decided in June 2002 to control the spread of technology by "intangible means," prohibiting the transmission of CBW technologies by e-mail, phone, or fax. For instance, with controls on intangible technology transfers, a company could be required to obtain government authorization before faxing abroad a "cookbook" for growth media that could be used in a biological weapons program.

At the June 2012 plenary meeting, the group agreed to amend the guidelines in order to enhance controls on brokering services and continued reviewing the proliferation risks of new and emerging technologies, particularly in the area of nanotechnology.

Although the effectiveness of the Australia Group is difficult to gauge definitively, the 42 member countries assert that the regime acts as an impediment to CBW proliferation by working to ensure that industries in member nations do not, either inadvertently or intentionally, assist states or groups seeking to develop CBW capabilities.

 


 

ENDNOTES

1. The 42 states participating in the Australia Group are Argentina, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, India, Ireland, Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, South Korea, Spain, Sweden, Switzerland, Turkey, Ukraine, the United Kingdom, and the United States. The European Union also participates. Several other countries, including Russia and China, have national export controls for some, but not all, of the items on the group's lists.

2. Quoted in Lois R. Ember, "Stemming the Tide," Chemical and Engineering News, July 15, 2002, p. 28.

Chemical/Biological Arms Control

Experts Call on Nuclear Suppliers Group Not to Bend the Rules

Sections:

Body: 

For Immediate Release: June 20, 2016

Media Contacts: Daryl G. Kimball, executive director, (202) 463-8270 ext. 107

(Washington, D.C.)—In a letter to the 48-member states of the Nuclear Suppliers Group (NSG), a group of 18 leading nuclear nonproliferation experts expressed "deep concern and opposition to pending proposals that could grant India and Pakistan membership in the NSG on the basis of an exceptional political preference—rather than on the basis of a common, strong, and meaningful set of nonproliferation and disarmament benchmarks for NSG membership."

The Nuclear Suppliers Group is are expected to discuss the Indian and Pakistani bids for membership at its plenary meeting in Seoul during the week of June 20.

The experts warn: "It is our assessment that any further country-specific exemptions from NSG guidelines for trade and/or membership without compensating steps to strengthen nonproliferation and disarmament would increase nuclear dangers in South Asia, and weaken the NSG and the broader nuclear nonproliferation regime."

"New membership bids,” the experts write, "should be considered on the basis of whether states meet an agreed set of strong and meaningful nonproliferation and disarmament benchmarks.”

Signatories of the letter sent to the NSG participating governments include two former special representatives to the President of the United States on nonproliferation and the former U.S. negotiator for civil nuclear cooperation agreements.

"Neither India nor Pakistan meets the NSG’s membership criteria,” the letter continues, "nor does either country meet the same standards of behavior as current NSG members, nor is it clear that either state shares the NSG’s basic nonproliferation motivations, including the NSG’s efforts to stem the spread of sensitive nuclear fuel cycle technologies that could be used for nuclear weapons purposes."

Under the guidelines of the NSG, membership requires that a state is a member of the nuclear Nonproliferation Treaty, among other considerations. In 2008, the United States pushed through an India-specific exemption from the NSG’s requirement that a state have full-scope international safeguards in order to be eligible for civilian nuclear trade.

“Unfortunately,” said Daryl G. Kimball of the Arms Control Association, "the United States has in the past month rejected consideration of proposals from some NSG participating governments for a criteria-based approach to membership. The Obama administration should adjust its irresponsible approach."

For the full list of endorsers and the text of the letter, see below.


Don’t Bend NSG Rules Without Steps to Strengthen Nonproliferation

June 8, 2016

Ambassador Rafael Mariano Grossi
Chair of the Nuclear Suppliers Group

Dear Ambassador:

We are writing to express our deep concern and opposition to pending proposals that could grant India and Pakistan membership in the Nuclear Suppliers Group (NSG) on the basis of an exceptional political preference — rather than on the basis of a common, strong, and meaningful set of nonproliferation and disarmament benchmarks for NSG membership.

It is our assessment that any further country-specific exemptions from NSG guidelines for trade and/or membership without compensating steps to strengthen nonproliferation and disarmament would increase nuclear dangers in South Asia, and weaken the NSG and the broader nuclear nonproliferation regime.

Neither India nor Pakistan meets the NSG’s membership criteria, nor does either country meet the same standards of behavior as current NSG members, nor is it clear that either state shares the NSG’s basic nonproliferation motivations, including the NSG’s efforts to stem the spread of sensitive nuclear fuel cycle technologies that could be used for nuclear weapons purposes.

Since the NSG granted an India-specific exemption for India from its longstanding full-scope safeguards standard for nuclear trade in September 2008, the Indian government has not met the nonproliferation commitments it pledged it would meet in return for the exemption: its civil-military nuclear separation plan is not credible; its IAEA Additional Protocol arrangement is far weaker than those of the nuclear-armed states; and the administrative arrangements negotiated by the United States and other nuclear suppliers for tracking India’s nuclear material are insufficient.

India and Pakistan have refused to accept critical disarmament responsibilities and practices expected of all other nuclear-armed states, including a legally-binding commitment not to conduct nuclear tests (such as signing the 1996 Comprehensive Test Ban Treaty), halting fissile material production for weapons, and reducing nuclear and missile arsenals. Instead they are increasing their nuclear arsenals.

Thus, there is no basis to accept the argument offered by U.S. officials that Indian membership in the NSG would give India more of a stake in the nonproliferation regime.

Pakistan, which has a history of transferring sensitive nuclear fuel cycle technology and is expanding its own nuclear weaapons capabilities, has an even weaker case for NSG membership than India.

In our view, the best way to bolster the global nonproliferation and disarmament effort is to set strong standards for new membership that reaffirm the basic objectives and purposes behind the NSG and strengthen its role as a multilateral institution.

Sincerely,

Susan F. Burk
Former Special Representative of the President of the United States for Nuclear Nonproliferation (2009-2012)

Joseph Cirincione,
President, Ploughshares Fund

John D. Holum,
former U.S. Undersecretary of State for Arms Control and International Security

Angela Kane,
Senior Fellow, Vienna Center for Disarmament and Non-Proliferation,
former High Representative for Disarmament Affairs, United Nations

Daryl G. Kimball,
Executive Director, Arms Control Association

Michael Krepon,
Co-Founder, Stimson Center

Edward P. Levine
Chairman of the Board, Center for Arms Control and Non-Proliferation*

Jeffrey Lewis,
Middlebury Institute of International Studies*

Fred McGoldrick,
Consultant, and former Director of Nonproliferation and Export Policy,
U.S. Department of State

Robert K. Musil,
Chairman of the Board, Council for a Livable World*

Dr. Willam C. Potter,
Sam Nunn and Richard Lugar Professor of Nonproliferation Studies,
Middlebury Institute of International Studies*

Randy Rydell,
former Senior Political Affairs Officer in the Office of the UN High Representative for Disarmament Affairs

Henry Sokolski,
Executive Director of The Nonproliferation Policy Education Center,
and former Deputy for Nonproliferation Policy, Office of the U.S. Secretary of Defense

Sharon Squassoni,
Director of the Proliferation Prevention Program, Center for Strategic and International Studies*

Frank N. von Hippel,
former Assistant Director for National Security, White House Office of Science and Technology Policy

Leonard Weiss,
Stanford University, and
former Staff Director, U.S. Senate Committee on Governmental Affairs and chief architect of the Nuclear Nonproliferation Act of 1978

Ambassador Norman A. Wulf,
Special Representative of the U.S. President for Nuclear Nonproliferation (1999-2002)

*Institution listed for identification purposes only.

###

The Arms Control Association is an independent, membership-based organization dedicated to providing authoritative information and practical policy solutions to address the threats posed by the world's most dangerous weapons.

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In a letter to the 48-member states of the Nuclear Suppliers Group (NSG), a group of 18 leading nuclear nonproliferation experts expressed...

Country Resources:

Issues Develop as BWC Review Approaches

Kirk Bansak

Issues such as the search for ways to increase confidence in compliance and efforts to spur international cooperation on peaceful uses of biological agents are likely to feature prominently at the upcoming review conference for the Biological Weapons Convention (BWC), comments by delegates at a meeting in December indicate.

As part of a process of annual meetings with a narrow mandate, the Dec. 6-10 meeting, held at the UN Office at Geneva, did not have authority to make decisions pertaining to the substance and agenda of the review conference, which will take place at the end of this year. Nonetheless, the states-parties focused much of their attention on that conference, which will be the treaty’s seventh since its entry into force in 1975.

During statements at the December meeting, many delegations announced preliminary positions on major issues for the review. Some of the issues, such as implementation of the BWC’s provisions for peaceful scientific cooperation among the parties, could pit the Nonaligned Movement (NAM), a bloc representing about 100 developing countries, against Western countries.

The treaty’s peaceful-cooperation provisions, which are contained in Article X, are a perennial focal point, and debate over them could complicate consensus at the review conference, according to a nongovernmental BWC expert.

“Article X will be the real problem, particularly if NAM remains cohesive and insists or pushes very hard for an institutional mechanism for peaceful cooperation,” the expert said in a December e-mail exchange. “That might break the conference final declaration.”

The NAM has pushed consistently for increased international sharing of life sciences technology and expertise. In its opening statement at the December meeting on behalf of the NAM, Cuba promoted its 2009 paper on “the establishment of a mechanism for an effective implementation of Article X,” but did not reveal whether this will be one of the NAM’s objectives for the review conference.

The United States is anticipating the possibility that the NAM will pursue this formal mechanism, according to an official from the U.S. Department of State. “The problem is that the [Cuban paper’s] recommendations are very vague,” he said in a Dec. 17 interview. This vagueness has contributed to the paper’s popularity, he said. “It’s a bit of a Rorschach test. Everyone looks at it and sees something different. I’d like to see a more developed proposal,” he said.

During the 2006 review conference, the NAM proposed an Article X action plan “to provide a framework for the development of scientific cooperation and technological transfer in order to achieve the objectives of the Convention.” The parties did not reach agreement to adopt the plan at that time.

More broadly, Cuba’s statement at the December meeting called for “the promotion of international cooperation as provided for in Article X” to be addressed at this year’s review conference. Cuba also insisted on “removing the arbitrary and politically motivated denials.” This comment reflects the NAM countries’ discontent with export controls on dual-use items, particularly under the multilateral export control regime known as the Australia Group, according to the State Department official.

The Australia Group, which controls exports of biological and chemical dual-use materials, consists principally of Western countries. Dual-use items are those that can be used for both peaceful and military purposes, such as virulent pathogens and certain technologies.

BWC diplomacy has long been marked by the debate over what constitutes adequate implementation of Article X. Driving the debate are divergent views over the proper balance between sharing of technology and nonproliferation obligations, as well as ideological differences over the function of the BWC, according to the State Department official.

Verification and Compliance

Verification remains a hot-button issue and was addressed in several opening statements at the December meeting.

The United States reiterated its position that “a verification regime is no more feasible than it was in 2001,” referring to the U.S. withdrawal in 2001 from negotiations on a legally binding inspection regime aimed at verifying compliance with the treaty. However, the United States and other countries hinted at alternatives that could be more politically viable.

“A certain amount of energy is going into determining if there are alternatives to a traditional verification mechanism,” the State Department official said. The United States “is looking into a number of things,” which could include an enhancement to the currently existing confidence-building measures or a push to “rethink the issue from the ground up,” he said. The existing confidence-building measures are collections of data submitted by the parties on a voluntary basis.

In an opening statement on behalf of the European Union, Belgium declared that one of the EU’s main goals for the review conference was “to build confidence in compliance to the Convention,” but it did not specify how this could be accomplished. A joint statement by Australia, Canada, Japan, New Zealand, Norway, South Korea, and Switzerland echoed the importance of improving confidence in compliance and suggested this issue “be taken up both at the Review Conference and in the subsequent intersessional process,” referring to the program of official work and meetings that takes place between review conferences.

Meanwhile, in keeping with their long-standing position on the matter, the NAM countries, along with Russia, pressed the need for a legally binding verification protocol. On behalf of the NAM, Cuba urged the United States “to reconsider its policy towards this [issue] in light of the persistent request of other parties,” while Russia reiterated its belief that a legally binding verification mechanism remains “one of the key ways to improve the BWC.”

This persistence was not unexpected, and rhetoric on verification is likely to continue, according to the State Department official. “The question is not the rhetoric, but whether there will be follow-through based on it,” he said.

“We should have a pretty clear idea in advance of the review conference where the broad lines are drawn,” he predicted.

Confidence-Building Measures

Many countries have advocated using this year’s review conference to modernize and increase participation in the parties’ information exchange system, known as confidence-building measures. Switzerland noted that the measures “continue to be the only tool to establish some degree of transparency and confidence among the States party to the BWC.” However, this system has not been updated since 1991.

Possible improvements to the current system identified by governments and independent experts include revising the information queries to make submissions easier to analyze, broadening the scope of shared information to better reflect new scientific developments, and facilitating and streamlining the submission process, for example, through the creation of an online submission tool.

However, all parties are not convinced of the desirability of revising the current information exchange process. In its opening statement at the December meeting, Iran said that “modifying the existing forms would adversely affect” the goal of attaining submissions from all parties. Iran did not explain the reason for its concern.

Iran also linked confidence-building measures to the issue of peaceful cooperation, saying that “the interest of States Parties to voluntarily submit the [confidence-building measures] reports may diminish” if the process does not “lead to the promotion of the international cooperation in the field of peaceful biological activities.”

Although the number of submissions reached a record high in 2010, that number was only 70 out of 163 parties, as of Dec. 10.

Intersessional Process

An essential task awaiting the parties is determining the program of official work and meetings that will take place between the seventh and eighth review conferences.

Since 2003, this program, known as the intersessional process, has included two annual meetings that are convened to “discuss, and promote common understanding and effective action” on topics prescribed in the final reports of the previous two review conferences. Although the parties have generally viewed the meetings as successful in the context of their limited mandate, some countries have expressed a desire to broaden the scope of the intersessional process in terms of the topics addressed and the authority to make decisions, a power that the current mandate excludes.

In her opening statement at the December meeting, Laura Kennedy, head of the U.S. delegation, outlined a vision for the future intersessional process that includes “greater flexibility to address sets of related issues,” standing working groups “to deal with specific issues,” and “greater authority” for adopting decisions. The joint statement by Australia, Canada, Japan, New Zealand, Norway, South Korea, and Switzerland also voiced support for an appropriate decision-making mandate and the creation of standing working groups.

Meanwhile, Iran said that “any attempt to manipulate the current mandate of the intersessional meetings may lead to the complication of any decision on the continuation of this process.” It was not clear whether Iran itself is opposed to altering the intersessional process or senses opposition by another country.

“The weight of international focus is on how to improve the intersessional process, rather than whether or not we do,” the State Department official said.

Scientific and Technological Advances

Referring to the last two decades of BWC meetings, Germany said in its December opening statement that the parties have “failed to identify and assess the benefits and misuse potential of scientific and technological developments in the life sciences as well as their impact on the Convention.”

As agreed in the final document of the 2006 review conference, the parties will address the impact of scientific and technological advances on the operation of the BWC during this year’s conference.

The possibility of taking this issue beyond the review conference also has been endorsed. In an address at the December meeting delivered on behalf of UN Secretary-General Ban Ki-moon, the director-general of the UN Geneva office, Sergey Ordzhonikidze, said, “With the pace of advances in biological science and technology growing ever quicker, there is a pressing need for a structured and regular means of monitoring developments and assessing their implications.”

“A lot of the thinking on how to deal with this issue is still fuzzy,” cautioned the State Department official. “This issue should be addressed in some way,” he said, but “whether that means doing so in a working group or through some other process is still an open question.” Germany proposed including the topic on the agenda of the next intersessional period.

Dissent and Optimism

One source of controversy at the December gathering was the draft of the meeting report.

During the plenary discussion of the draft report, a collection of NAM countries challenged part of the draft’s phraseology, arguing that it appeared to be making substantive decisions that exceeded the mandate of the meeting. However, several Western countries maintained that the disputed text was consistent with analogous documents in previous years, according to an account by the BioWeapons Prevention Project that was confirmed by a Western delegate.

Also during the December meeting, the states-parties officially accepted by consensus the nomination of Paul van den IJssel, the Netherlands’ ambassador to the Conference on Disarmament, as chairman for the review conference.

In his acceptance speech to the parties, Van den IJssel declared that “ambitious realism will be my guiding principle in the coming year.” In an e-mail exchange after the meeting, Van den IJssel said that, in the course of his consultations with a wide range of delegations on the margins of the meeting, he observed that his principle was “broadly shared among States Parties.”

In his speech, Van den IJssel said, “Compromises will undoubtedly have to be made at the Review Conference, but we can keep them to a minimum by working together openly and constructively, avoiding surprises, and accommodating the interests of others wherever possible.”

The 2011 review conference of the BWC was officially scheduled for Dec. 5-22, with a meeting of a preparatory committee scheduled for April 13-15 to set the formal agenda of the review conference.

 

At the annual meeting of parties to the Biological Weapons Convention, delegates were staking out positions on issues that are likely to figure prominently at this year’s review conference.

Australia Group Adds 14 Pathogens to Control List

Jonathan Yang

The Australia Group decided June 5 to add 14 human pathogens to its Biological Control List. During the four-day meeting in Paris, the group also agreed on new policies aimed at helping both member and nonmember states participate in decreasing the dangers of chemical and biological weapons.

The control list is aimed at preventing the export of certain items that could be used to produce biological weapons. The human pathogens added this year to the Biological Control List include two toxin-producing strains of bacteria, six bio-safety level (BSL)-4 viruses, and six BSL-3 viruses, all of which the Australia Group believes could potentially be made into lethal biological weapons. Some have grabbed headlines in the last decade, including Escherichia coli (commonly referred to as E. coli) 0157:H7, the strain that caused a 1993 outbreak in Jack in the Box restaurants in the western United States that hospitalized 125 and killed three. They also added to the list several strains of Hantavirus, including the one that caused a 1993 outbreak in the Four Corners region—named after the area where the borders of Utah, Colorado, Arizona, and New Mexico meet. That outbreak killed more than half of the 48 people infected that year.

In addition to enlarging the Biological Control List, the group’s members agreed to measures to increase transparency and information sharing within the group and approved a practical guide to help officials ensure compliance with the group’s export controls. Member states also endorsed “a cooperative program of action to engage countries in the Asia-Pacific region on chemical and biological weapons-related export control issues,” according to a June 6 Australian Foreign Ministry press release, in an effort to reach out to nonmember countries in a regional manner and encourage their help in stemming the spread of these weapons.

The Australia Group began in June 1985 when 15 countries decided—in the wake of a UN investigation into Iraq’s use of chemical weapons in its war with Iran—to harmonize their export controls over materials that could be used to develop chemical weapons. Annual meetings have continued, with membership in the group growing to 33 states plus the European Commission and its concerns expanding to include biological weapons. Member states are united by their common objective of using export-licensing measures to ensure that they do not contribute—overtly or inadvertently—to a third-party nation’s development of chemical or biological weapons.

Human pathogens are categorized by their bio-safety level based on a scale from 1 to 4, with 1 representing organisms that are difficult to transmit, easy to treat, or nonpathogenic and 4 representing pathogens that are easy to transmit, have no known cure or vaccine, and have high mortality rates.

 

The Australia Group decided June 5 to add 14 human pathogens to its Biological Control List. During the four-day meeting in Paris, the group...

Creating a New Multilateral Export Control Regime

Michael Beck and Seema Gahlaut

As the United States turns to military means to disarm Iraq, it is an opportune time to reflect on the role that Western governments played in arming Iraq with the technologies and components needed for weapons of mass destruction (WMD) and on the failure of export controls to limit Iraq’s access to such items. It is important to remember that much of Iraq’s WMD capability was derived not from smuggling and theft, but from purchases of key weapons-related components by Iraqi agents who systematically exploited gaps in Western export control systems. Post-Persian Gulf War national and international investigations revealed that Iraq purchased—either directly or through front companies—the majority of materials and technologies needed for its various weapons programs.

Much of what we know about Iraqi capabilities indicates that they were built over the years by setting up elaborate networks of shell companies, innocuous procurement agents, and convoluted financial and transshipment routes.1 One recent media report notes that “Iraqi agents have been known to carry 30-page shopping lists of prohibited equipment. They usually pay in cash and buy in bulk. The military industrial commission usually remits the money through the nearest Iraqi ambassador or military attaché.”2 All of this effort converged on one goal: to divert legitimate exports of dual-use goods and technologies, those with both civilian and military applications, into Iraq’s illicit weapons programs.

The Iraqi case has at least three serious implications for the future U.S. arms control and nonproliferation agenda. First, the post-September 11 focus on preventing nuclear and other WMD materials and technology with military purposes from falling into the hands of terrorists needs to be complemented with a parallel focus on ensuring that trade in dual-use technologies is closely monitored and regulated. For those trying to operate under the radar while building their WMD capability, seemingly legitimate purchases of technologies and materials are as attractive as smuggling of such technologies. Indeed, the recent revelations about the WMD capabilities of Iraq, Iran, and North Korea suggest that these states apparent capabilities owe a great deal to the export decisions—deliberate or inadvertent—made by supplier states such as Russia, China, Germany, France, and Pakistan.

Second, the U.S. reliance on supply-side strategies such as export controls, which involve government licensing and oversight of the trade in weapons and sensitive weapons-related technologies, need to be tempered with the understanding that these tools comprise only one segment—albeit an important segment—within the broad spectrum of arms control and nonproliferation tools available to the international community. Export controls are designed to thwart and delay proliferation by limiting access to WMD-related technologies and goods. By limiting access, these controls help to make WMD programs more expensive, financially and diplomatically, for countries seeking such weapons. Unfortunately, the ease with which technical knowledge and hardware spread in our globalized world means that export controls by themselves cannot end proliferation. They are the proverbial finger in the dike that stanches the flow while waiting for reinforcement. That reinforcement stems from parallel support on multiple fronts, such as confidence-building measures, arms control agreements, multilateral sanctions and incentives, and counterproliferation, all of which are aimed at offering viable alternatives to merely coping with the effects of proliferation. Although export controls may have inherent limitations, they are certainly less costly than pre-emptive strikes and armed interventions to disarm proliferators.

Finally, the United States must work with its allies and other major suppliers to strengthen cooperation in regulating and monitoring trade in weaponry and dangerous technology. Currently, they seek to coordinate their export regulations on proliferation-sensitive technologies and conventional arms through four multilateral export control regimes: the Nuclear Suppliers Group (NSG), the Australia Group, the Missile Technology Control Regime (MTCR), and the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies. These multilateral regimes operate at the cutting edge of security, economics, and technology. Consequently, they have borne the brunt of the dizzying changes in their operating environment. Uncertainty about who is “the enemy,” which markets to ignore, and which technologies to consider obsolete is the dominant characteristic of this environment. Despite the challenge of operating in a fluid environment, the export control regimes will remain relevant if suitably modified. (See ACA Fact Sheets for more information on multilateral export control regimes.)

The four existing export control regimes have scored some noteworthy successes. They have improved international cooperation in regulating and monitoring the trade in sensitive technologies, and they have helped harmonize the export control systems of major supplier states. Without these export control regimes and coordinated international efforts to monitor proliferation-relevant technologies and arms, states such as North Korea, Iraq, and Iran and nonstate groups hostile to the United States would have access to even more advanced and dangerous weaponry.

Nevertheless, these regimes have serious flaws and are ill-equipped to respond to an increasingly complex environment characterized by technology trade on a global scale, as well as new substate threats.3 Perhaps most importantly, advances in technology—including technology with potential military applications—are far outpacing changes in national regulations and multilateral agreements.4 Even with incremental improvements, export controls are becoming less, not more, effective. The United States and its allies should rethink their approach to controlling dangerous exports, and sooner rather than later.

Problems with Current Regimes

Governments are struggling to coordinate export controls for several reasons. First, the members of the regimes are finding it more and more difficult to agree on which countries should be targeted for stringent controls. The export control regimes originated with groups of like-minded supplier states, notably the United States and its allies in Western Europe and Japan, that agreed on the nature of the threat and appropriate responses.

Since the end of the Cold War, the number of states participating in the regimes has grown, but at the cost of diluting the original membership criteria. This expansion was driven primarily by the euphoric belief in the nonproliferation community that the end of the Cold War had inaugurated an era in which former Warsaw Pact states would make common cause with the West to squelch WMD proliferation. Another factor was the consolidation of the European Union (EU) into a common economic market with few barriers to the movement of goods and services. The extension of the export control regimes to include the EU thus became almost automatic. The MTCR, for example, has grown in membership from seven members (the Group of Seven) in 1987 to 33 in 2002. That means that the regimes now include nonsuppliers as well as states that differ significantly in their definition of threats and their understanding of the letter and spirit of the requirements imposed by the regimes.5

In part, these differences reflect the disparate economic and strategic interests of the member states. Russia, Ukraine, and Kazakhstan, for instance, are now members of some of the regimes. Unlike traditional U.S. allies, these countries face serious economic hardships, making their defense establishments far less willing to walk away from questionable but lucrative dealings with China, India, and Iran.6 Instead, these countries are inclined to search for loopholes in the export control regimes.

Second, the former communist countries and U.S. allies in Europe resent U.S. pressure—and U.S. political power—to implement strict controls. U.S. regulations are much stricter than are those of the other regime members, leading them to see U.S. controls as unreasonable and as a means of maintaining the already-commanding U.S. technological edge. As such, some countries have begun finding ways to undercut U.S. export controls. Reports have surfaced that Germany and Sweden permitted the export of electron-beam machines needed for making computer chips to the Chinese firm SMIC, even though the United States routinely bars its own companies from exporting these items to SMIC for fear of proliferation.7 Britain and France have long been suppliers of conventional weapons to India and Pakistan.8 U.S. companies, predictably, have become increasingly vociferous in their complaints about their declining ability to compete.

Third, the control regimes do not require their members to fully disclose which exports they have approved and which they have denied; consequently, they lack the kind of transparency that is crucial to prevent one country from supplying an item that was denied by another. For example, a recent General Accounting Office (GAO) report noted that many governments that participate in the Nuclear Suppliers Group have yet to share any information on export denials. Nor have they shared even the informal suggestions they have issued to businesses advising them not to pursue contracts with suspect end-users.9

The GAO report also drew attention to problems of timely information-sharing. The report noted that the United States did not report any of 27 Australia Group-related export license denials between 1996 and 2001 and also pointed out that nearly half of the Wassenaar member states failed to submit information on export denials within established reporting time frames. The report observed, furthermore, that regime members often failed to incorporate the decisions reached within the regimes into their national export control regulations quickly and uniformly. There have been cases in which some countries, including the United States, have taken as long as a year to make the agreed-upon changes to their national laws.

Fourth, the regimes continue to operate informally and by consensus. Although unanimity may enhance the regimes’ perceived legitimacy, it also allows any single member to hold any decision hostage. In addition, members sometimes ignore even those decisions to which they have freely assented, since those decisions are not legally binding. Member states have been left to decide for themselves which regulations they want to incorporate into their national export control systems and how they will be implemented. Even when states egregiously disregard their commitments, other member states can do little more than attempt to shame the violator. Although 32 of the 34 members of the NSG agreed that Russia’s shipments of nuclear fuel to India in January 2001 were inconsistent with Russia’s NSG commitments, they could do no more than exhort Moscow not to continue with the deal.10

Finally, the new members of the multilateral export control regimes, including former Warsaw Pact members, lack the institutional capacity and the resources to implement export controls fully. To be sure, the United States has created an active and effective export control assistance program that provides vital help to much of the former Soviet bloc. Yet, many in Europe and the United States have clamored to reward East European countries with membership in the regimes for political reasons—and to do so before these countries have proved their ability to implement and enforce controls.11

The Challenge of Globalization

In addition to dealing with the internal strains caused by their growing membership, the regimes must also cope with external pressures from increasing globalization and the rapid advancement of technology. In the high-technology sector, for example, industry standards and practices change rapidly, and these innovations spread quickly around the world. At the same time, the growth of global trade and financial markets has encouraged consolidation and integration across national borders through mergers, acquisitions, joint ventures, and strategic partnerships. In addition, the leveling effect of the skill revolution and technology diffusion has induced industry to reorganize its functions in global networks rather than nationally based hierarchies. Intra-firm and intra-industry intelligence gathering and information-sharing have become the prime requisites for rapid innovation.12 At the same time, global defense and high-technology firms are engaged in an increasingly competitive struggle for markets. Export controls that place uneven or significant hurdles in the way of efficient sharing of information, ideas, and personnel across national boundaries are viewed by many global companies as a threat to their ability to innovate and to capture new markets.

The multilateral control regimes include provisions for revision and updating of the necessary lists and rules. In theory, then, they should be able to adapt swiftly to changes in technology and industry. In practice, they operate in a bureaucratic environment that allows only glacial change—meaning that reform measures inevitably fall behind technological innovation. Government regulations on the export of goods, technologies, and skilled personnel, whether national or multilateral, have lagged far behind business. Even at the national level, officials have to struggle to build a consensus around new regulatory needs and, in some cases, even struggle to comprehend how emerging technologies are related to security requirements. As a result, timely international coordination is even more problematic.

Controlling exports of emerging dual-use technologies today requires particular foresight and the ability to juggle competing demands. Officials in supplier states have to keep pace not only with technologies that pose a threat today but also with technological innovations that might be militarily relevant tomorrow. At the same time, they have to stay abreast of whether foreign competitors are moving forward with similar sales, for fear that by clamping down too hard they could threaten the competitiveness of domestic firms—harming their own constituents.

Such assessments have become even more complicated now that states outside the regimes are becoming important economic and military powers. Most prominently, regime members are torn over how to treat countries such as China, India, and Israel, which have emerged as attractive markets for high-technology goods and as useful partners to help develop certain technologies. But exporting sensitive dual-use goods to these countries is problematic because they could fuel weapons programs and encourage these states, along with North Korea, Iraq, and Pakistan, to supply WMD technology to third parties—resulting in secondary proliferation.

These nontraditional suppliers represent the latest proliferation concern. The Director of Central Intelligence, George Tenet, asserted recently that a number of countries were determined to preserve their WMD and missile programs over the long term by innovative means. These countries, said Tenet, were seeking to insulate their programs against interdiction and disruption. They were also trying to reduce their dependence on imports by developing indigenous production capabilities. Although indigenously manufactured components are not always good substitutes for foreign imports—particularly when more advanced technologies are involved—they suffice as a stopgap in many cases. In addition, as they refined their domestic capabilities, these countries could emerge as new suppliers of technology and expertise. Most worrisome, many of these countries—such as India, Iran, and Pakistan—do not adhere to the export restraints embodied in such supplier groups as the NSG and the MTCR.13 The United States and other regime members must now find strategies to ensure that these countries do not supply other states with weapons of mass destruction and missiles.

The business of controlling exports in today’s global era is complex because threats are numerous and difficult to categorize, and the list of technologies that appear innocuous on their face but can add to the lethality of hostile groups is growing. At the same time, the rapid growth and diffusion of dual-use technology makes it more difficult to pinpoint the sources of proliferation. It weakens the arguments for controlling basic technologies, since these technologies have numerous commercial uses as well as the capacity to be pressed into service to build armaments.

Proposed Solutions

How can the multilateral export control regimes be reformed to address the growing list of challenges before them? Knowledgeable observers have proposed a variety of options for strengthening them. We can broadly categorize these into policy- and process-level solutions. Policy-level solutions recommend a frank re-examination of the purpose of the regimes, the role of the United States in them, the demands issued by the new members, and their policies toward nonmembers. Process-level solutions recommend ways to improve the export control regimes by making them more robust, by improving information sharing, and by socializing new members into the norms of nonproliferation. Strengthening the regimes will require solutions at both the policy and process levels.

As a first step, export control regime member states should institute a permanent secretariat in Vienna for the four existing regimes and arrange for them to hold their plenary meetings in that city. A meeting of all countries that are party to one or more of the export control regimes would be held prior to the individual plenaries. This grand plenary meeting might be called “The Multilateral Export Control Coordination Forum.” This forum would facilitate discussions of how best to address many of the cross-cutting export control issues currently facing the regimes while serving as a platform for negotiating a newly restructured export control regime that would encompass the controls embodied in the existing four regimes. Bringing together the work of the existing regimes would help minimize their inefficiencies while putting their limited political and technical resources to best use.

Holding the plenary meetings of existing export control regimes jointly would yield manifold benefits. First, it would promote inter-regime dialogue on cross-cutting export control issues such as transshipment, controls on transfers of intangible technologies, information sharing on end-users of concern, best practices, and harmonized export documentation. Second, it would help avoid duplication of effort, because the strategies to deal with complex control issues and problematic end-users vis-à-vis different types of technologies are similar, if not the same.

Third, it would save money. Too much of what occurs at regime meetings is “diplomatic tourism.” For example, in 2003 the regime plenaries will be held in Seoul (NSG), Buenos Aires (MTCR), and Vienna (Wassenaar Arrangement). The presence of the International Atomic Energy Agency (IAEA) and other security and economic institutions such as the Organization for Security and Cooperation in Europe and the Comprehensive Test Ban Treaty Preparatory Commission in Vienna would also facilitate cost savings because regime members could post their technical experts on nuclear and other security issues in the city for managing related nonproliferation work.

Fourth, co-locating the activities of all the regimes would allow them to build some institutional memory and semi-permanent expertise—counteracting the high rate of personnel turnover in national export control agencies and helping new entrants negotiate the sharp learning curve. A single location would also streamline the current, scattershot efforts of the regimes’ staffs to keep records of what transpired at various meetings.

Finally, if multilateral export control efforts were centralized, higher-level policymakers would be more likely to attend the plenary sessions and see the importance of coordinating international controls on all dangerous items. Their participation, in turn, could mobilize the resources and the political capital needed to pursue a more significant restructuring of the existing four export control regimes.

Vienna is the natural location to host these meetings and a secretariat, since the Wassenaar Arrangement has already been working there for some time. The functioning Wassenaar Secretariat could provide organizational support for the annual plenaries and the biannual technical meetings. Moreover, the secretariat could become the locus for training new representatives from member states on export controls.

Still, these procedural reforms do not go far enough. The existing regimes remain far too informal to promote coordinated and harmonized export controls. They are also limited in their ability to formulate timely and actionable policies to meet new challenges because, as noted earlier, they operate on the basis of consensus decision-making. The situation will continue to worsen as the membership of the regimes becomes even more diverse in terms of capabilities and interests.

To be sure, the Bush administration’s National Strategy to Combat Weapons of Mass Destruction recognizes these shortcomings and calls for strengthening the existing multilateral regimes. But it fails to lay out specific suggestions. And the reality is that these regimes are beyond tinkering. They cannot be strengthened as currently constituted and must be restructured.

The changed environment of the existing regimes strongly suggests that a new, combined, and somewhat more formal regime should be established. This new regime should be based on an explicit agreement among its members to formulate and implement policies that will impede the efforts of hostile states, states that sponsor terrorism, terrorist organizations, and individuals to obtain weapons of mass destruction and the goods, technologies, and know-how that can be used to build them. Specifically, the members of a beefed-up regime would undertake to establish transparent, effective, and harmonious export control policies and practices—especially common regulations for the trade and transfer of conventional weapons and dual-use items—so that they can accomplish the objectives of the regime without impeding legitimate commercial transactions. All of the members would also have to agree to abide by the decisions of the regime, including those that are reached without unanimous consent.

Membership in such a regime should be open to those states that are currently participating in any of the four export control regimes (NSG, MTCR, Australia Group, or Wassenaar) as currently constituted. Membership should also be open to states that are both able to transfer or retransfer relevant goods or technologies and ready to make an unambiguous commitment to the goal of nonproliferation in general and the regime’s objectives in particular. All members, new and old, would be evaluated both for their commitment and their ability to implement export control regulations.

A restructured multilateral export control regime should be governed by the following principles and objectives:

1. Replace consensus decision-making with majority voting, at least in such areas as admitting new members, identifying violations by existing members, and developing remedies to deal with violations. Prospective members of a new regime should also consider replacing consensus decision-making rules with weighted voting on issues such as modifying the control lists. This would give more weight to the preferences of suppliers of a particular item than to transit states.

2. Specify the commitments and responsibilities of members and formalize the operations of the regime. For instance, prospective members might be required to agree to incorporate decisions taken within the regime into national law within a specified period and with minimal exceptions based on national circumstances. Measures of this kind would limit the scope for arbitrary flouting of the regime by individual governments.

3. Introduce a dispute-resolution mechanism that allows collective discussion about possible violations by a member, gives that member an opportunity to explain its behavior, and requires all members to abide by the collective decision at the end of the process.

4. Establish clear and uniform criteria for membership, possibly including conditions for expulsion.

5. Establish a tiered list of end-users. Tier 1—the Denied Parties List—should consist of end-users, such as terrorist organizations, that all members agree must be denied controlled technologies. Tier 2—the Sensitive Parties List—should consist of end-users and destinations that are considered proliferation sensitive. Transfers to entities on this list would require approval from a two-thirds majority of member states. Tier 3 should constitute a watch list. Transfers to actors on this list would be based on national discretion, but members would agree to share information on the transaction with the regime after they have approved exports to these actors.

6. Establish an Executive Committee composed of representatives from all member countries. The committee would meet regularly to review proposed transfers to entities on Tier 2; to share information on end-users and developments of common concern; and to chart out new regime policies, such as best practices, to be considered at the annual plenary meetings.

7. Create a team of international experts to provide export control training to prospective members and countries interested in adhering to the standards upheld by the regime.

8. Strengthen information-sharing requirements to include not only denial notifications, but approvals.

9. Require all existing members to agree to these changes explicitly and reaffirm their membership in the new regime and requiring any new entrants to do the same.

Opposition to Restructuring

Officials commonly offer several different objections to the notion of fundamentally revamping the export control regimes. Some experts and officials argue that even a sweeping process of centralizing and restructuring would not yield control regimes that are substantially more effective than the current ones. Others claim that any attempt to restructure or merge the regimes would risk moving export control efforts toward the least common denominator, thereby weakening multilateral efforts. Some point to problems that could arise from the fact the four regimes have differing memberships. From this, they conclude that establishing one control regime would be nearly impossible. Finally, some argue that renegotiating the regimes would be too politically difficult, and thus muddling through under the status quo is preferable.

These concerns are worth considering. Yet, on closer examination, none of them provides grounds for failing to move quickly to strengthen multilateral proliferation controls given the growing challenges posed by global trade and the spread of dangerous weapons technology. First, crafting an overarching multilateral control regime would result not in a weaker regime, but in a stronger one. The point of restructuring a new regime is to raise the bar, not lower it. If the potential members of a new regime failed to negotiate a significantly improved arrangement, they would simply stick with the status quo and continue to make incremental improvements.

Second, the reality is that the existing hodgepodge of regimes already represents the least common denominator. Almost any change would be an improvement. At present, all decisions are taken on the basis of consensus, allowing even one member to stall efforts at reform. By contrast, our idea is to begin by informally coordinating multilateral export controls across regimes and to use this collaborative work as a springboard to a new, overarching institution. The member governments would not agree to abandon the existing export control regimes until they were convinced that the new regime would be a meaningful improvement over the old. The existence of a new regime would also not obviate the possibility of, or need for, micro-regimes that might allow two or three countries to coordinate additional controls on selected technologies.

The fact that the existing regimes have different memberships is also not an insurmountable obstacle to reform. The most politically significant membership issue is Russia’s absence from the Australia Group. Some officials in the United States and Europe are quick to note that the Australia Group is the most effective of the control regimes precisely because Russia is not a member. However, a restructured regime could deal with problem countries such as Russia, as well as concerns that members will not uphold the decisions laid down by the regime, in at least three ways. First, under the aegis of a single regime, sub-arrangements might be devised that excluded Russia and thus sidestepped the difficulties entailed in dealings with Moscow. Second, if consensus rules were replaced with more democratic voting rules, Russian attempts to stall reform would be thwarted. Third, if incorporated into the new regime, as we have proposed, a dispute-resolution mechanism would allow other members collectively to censure, or even expel, problem countries.

It is also true that the United States sometimes uses consensus rules to prevent further erosion of the regime or to defend its economic interests, leading some to suggest that the status quo is adequate. The benefits gained from Washington’s vetoing of the membership of one country or the decontrol of a particular item, however, are fewer than the benefits that would accrue from a new institution that facilitated increased information sharing, the implementation of best practices, common approaches to licensing, and a more coordinated response to actors of proliferation and security concern.

Perhaps the most serious obstacle, however, is the opposition of the business community to a tougher system of export control. To gain a measure of the influence of the defense industry, consider that worldwide military expenditures topped $839 billion in 2001, up from $798 billion in 2000.14 The top five global suppliers of conventional weapons are all members of the Wassenaar Arrangement. In 2001, total world arms transfer agreements were worth nearly $26.4 billion. The United States led the world with 45 percent of all such agreements.15  One reason the defense industry has such influence in the U.S. government is because of federal campaign contributions. Industry contributions totaled $9.5 million during the 2002 election cycle.16 Strengthening the Wassenaar Arrangement and multilateral arms export controls in the face of such influence is especially problematic.

Dual-use technology exports are likewise of great importance for some industry sectors. Moreover, many of the important markets for high-technology companies are in countries of some security concern. The Department of Commerce, for example, licensed more than $12 billion worth of dual-use trade to China between 1991 and 2001. The pace of technological change and innovation in the high-technology sector in the United States has further diminished the latitude and propensity of the Commerce Department, the Department of Defense, and other licensing agencies to severely restrict the market-clearing decisions of domestic companies in these sectors. The situation is not significantly different in other supplier nations.

Nevertheless, the ability of the European Union to construct a common export control system demonstrates that, if governments demonstrate sufficient political will, a new multilateral export control regime can emerge that is better equipped to respond to new threats and new trade realities. Although export decisions are made at the member-state level, the EU’s dual-use export control regime is significant to the extent that it entails binding guidelines and common criteria. Despite these obstacles, in an age in which terrorists and their sponsors seek dangerous technology and weapons, bureaucratic turf wars and the economic interests of suppliers must not dictate policy outcomes, thereby compromising the security of this country and its allies.

The Need for Political Leadership

Greater political leadership is essential. To date, export controls have been underused as nonproliferation tools. They are poorly understood by the public, policymakers, and even nonproliferation specialists—many of whom seemingly believe that controlling weapons of mass destruction is simply a matter of physically securing related materials and technologies. They often fail to appreciate the fact that countries that have acquired weapons of mass destruction have done so by purchasing component parts, technologies, and materials (most of which are dual-use in nature) by lawful means. They also fail to recognize the role that Western suppliers play in arming parties in conflict-prone regions.

An additional barrier to reform is that export controls appear to be too bureaucratically and technically complex to engage the attention of political leaders around the world. Having four regimes that appear to policymakers to be doing the same thing—regulating weapons-related technologies and items—has resulted in a lack of sustained high-level political attention in almost all member states, including the United States. In this context, one can understand the complaints from high-technology firms and their clients about confusing and overlapping regulations and the consequent introduction of piecemeal solutions by individual legislators. In most countries that we have studied, the issues appear so esoteric to national policymakers that few high-level political resources are invested to rationalize the national export control system as a whole. The enterprise of harmonizing national systems with the requirements of the multilateral regimes commands even less support.17

Who should lead the effort to strengthen multilateral export controls? The United States is the obvious candidate to spearhead an effort to strengthen export controls, especially in light of the Bush administration’s emphasis on countering terrorism and the WMD threat from Iraq, Iran, and North Korea. Within the U.S. government, however, the idea of merging the export control regimes will likely encounter bureaucratic resistance and inertia. Some of the opposition stems from the concerns that were discussed and discounted above. Each regime also enjoys a handful of defenders in Washington. These individuals typically insist that the language, issues, communities, and status of each individual regime is too unique to blend without incurring significant risk.

In some countries, there are additional bureaucratic hurdles. For instance, it is not clear whether the concerns spelled out by government officials are genuine or whether they reflect more personal anxieties that reform would entail additional work and a loss of control. In some cases, officials who manage export control programs contend that they cannot fathom restructuring and strengthening the system because they are too busy defending the existing regimes from domestic and industry representatives who would just as soon do away with multilateral controls altogether. It is almost certain that, if key policymakers turn to the individuals currently implementing the regimes’ policies for guidance, they will be told that restructuring or replacing the four existing arrangements would be too difficult to negotiate, not to mention fraught with risks.

A more realistic way the United States can help bring about a strengthened multilateral system would be for Congress to call on the secretary of state to strengthen the multilateral system. Such legislation could be included in a reauthorization of the Export Administration Act, which has been languishing on Capitol Hill for more than a decade. A surprising ally in the quest to reform multilateral export controls might also be some U.S. industry groups. An often-heard complaint in industry circles is that control policies and licensing decisions and practices vary widely from supplier country to supplier country. As a result, they argue that foreign competitors in Europe and Japan have an unfair competitive edge. Thus, some businesspeople might welcome a multilateral control system that helps to “level the playing field,” along with legislation that simplifies the licensing process.

The European Union could also help spur reform. There is already considerable support for a reformed and consolidated export control regime, especially among the smaller countries. The expansion of the EU and NATO is in many ways forcing this issue, since new members of these organizations are expected to have export control systems compatible with those of the present members. All of the current EU member states are participants in all four regimes. As a group, however, the ten states most likely to be admitted to the EU are a mixed bag. Estonia does not take part in any of the regimes; Cyprus, to name one, is a member of only two of the regimes; the Visegrad countries are full members of all four regimes. If future EU members are not party to the regimes, there is the risk of conflict between regime export requirements and EU export privileges. There is also the problem of prospective EU countries that lack robust and effective export controls.

Reform or Stasis?

The grave threat posed by continued WMD proliferation and loosely regulated military exports suggests that export controls can no longer be entrusted to lethargic and informal organizations. Four regimes with vague provisions, limited information-sharing requirements, and crippling consensus rules are no match for terrorist organizations, to say nothing of countries such as Iran that are seeking weapons of mass destruction and other arms. The magnitude of this threat requires a wholehearted commitment by the political establishment in the United States and other countries.

We recommend forging a single, strengthened regime characterized by binding commitments on its members and some form of majority-based decision-making. We believe that a consolidated multilateral export regime would realign the multilateral effort to implement, enforce, and coordinate WMD and dual-use export controls in two highly beneficial ways: it would provide an opportunity for existing member states to renew their commitment, and it would allow other supplier states to join the nonproliferation effort. It is time to step back and retool the regimes in ways that maximize their unique strengths vis-à-vis the other nonproliferation tools and institutions.

History amply demonstrates that crisis is usually required to precipitate reform. One would think that the September 11, 2001, terrorist attacks, Iraq’s success in acquiring Western components for its WMD arsenal, and current concerns over proliferation elsewhere would prompt the kind of sweeping change we advocate. Yet, it is not apparent that even these clear signs of danger are adequate. Will it take an actual WMD attack on an American city, followed by revelations that American firms supplied the means to build the weapons used in the attack, to goad us into action?

Two possible futures await us. Either international efforts to strengthen the norms and legal barriers to weapons of mass destruction will be bolstered through a significantly improved regime or international efforts to monitor dangerous technologies and weaponry will falter. If our choice is the latter, we will have repeated the mistake of selling the rope used to hang ourselves.


NOTES
1. See David Albright and Khidhir Hamza, “Iraq’s Reconstitution of Its Nuclear Weapons Program,” Arms Control Today, October 1998.
2. Bob Drogin, “How Hussein Gets ‘Anything He Wants,’” The Los Angeles Times, November 23, 2002.
3. See Joseph Cirincione, ed., Repairing the Regime: Preventing the Spread of Mass Destruction (New York: Routledge, 2000), and Michael Barletta and Amy Sands, eds., Nonproliferation Regimes at Risk, Occasional Paper No. 3, Center for Nonproliferation Studies (Monterey: Monterey Institute for International Studies, 1999).
4. See William W. Keller and Janne E. Nolan, “Proliferation of Advanced Weaponry: Threat to Stability,” Foreign Policy, winter 1997-98, and Michael Hirsh, “The Great Technology Giveaway,” Foreign Affairs, September/October 1998, 2-9.
5. See Seema Gahlaut and Victor Zaborskiy, “Do Regimes Have The Members They Need?” Center for International Trade and Security Working Paper (Athens; Center for International Trade and Security, February 2003).
6. George Tenet, “Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January through 30 June 2000.” (Publisher/date)
7. See Richard Read, “U.S. Trade, Security Interests Clash Over Tech Exports to China,” Oregon Live, February 3, 2003.
8. “UK’s Arms Exports to India and Pakistan,” available at http://news.bbc.co.uk/2/hi/uk_news/politics/2012620.stm; “Al-Qaeda vs France, Or India vs Pakistan?” available at http://www.atimes.com/ind-pak/DE11Df01.html.
9. See U.S. General Accounting Office, Strategy Needed to Strengthen Multilateral Export Control Regimes (Washington, DC: General Accounting Office, 2002), GAO-03-43.
10. Ibid., 23.
11. For example, partly as a reward for its decision to forego nuclear commerce with Iran, Ukraine was allowed to enter the MTCR. As part of the membership agreement, Ukraine will keep its hundreds of Scud missiles – the type of rocket MTCR was specifically designed to counter – through the end of their service lives, and will not forswear future production of short-range missiles should Ukraine find it necessary. Howard Diamond, “U.S., Ukraine Sign Nuclear Accord, Agree on MTCR Accession,” Arms Control Today, March 1998.
12. See Sam Nunn Bank of America Policy Forum, Executive Summary: Globalization, Technology Trade and American Leadership: A New Strategy for the 21st Century (Athens: The University of Georgia, March 2000), Technology and Security in the 21st Century: U.S. Military Export Control Reform (Washington, DC: Center for Strategic and International Studies, 2001), and Sten Lundbo, “Nonproliferation: Expansion of Export Control Mechanisms,” Aussenpolitik 48, no. 2 (August 1997).
13. See his annual Congressional testimony, “Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January Through 30 June 2000.” See also Jason Ellis, “Beyond Nonproliferation: Secondary Supply, Proliferation Management, and U.S. Foreign Policy,” Comparative Strategy (2001), 1-24, and Michael Moodie, “Beyond Proliferation: The Challenge of Technology Diffusion,” The Washington Quarterly 18, no. 2, (spring 1995).
14. Stockholm International Peace Research Institute, Yearbook 2002: Armaments, Disarmament and International Security (Oxford: Oxford University Press, 2002).
15. Richard F. Grimmet, "Conventional Arms Transfers to Developing Nations, 1993-2000,” CRS Report for Congress (Washington, DC: Congressional Research Service, August 16, 2001).
16. This includes combined amounts from three categories, Defense Aerospace, Defense Electronics, and Miscellaneous Defense, in the database “Top Industries Giving to Members of Congress 2002 Cycle,” from the Center for Responsive Politics; available at http://www.opensecrets.org/industries/mems.asp?party=A&cycle=2002.
17. See, Michael Beck, R. Cupitt, Seema Gahlaut, and Scott Jones, To Deny or To Supply: Nonproliferation Export Controls in Five Key Countries (New York: Kluwer International, forthcoming).

 


Michael Beck is assistant director of the Center for International Trade and Security (CITS) at the University of Georgia. Seema Gahlaut is a senior research associate at CITS.

 

Australia Group Concludes New Chem-Bio Control Measures

July/August 2002

By Seth Brugger

Meeting June 3-6 in Paris, members of the Australia Group concluded a number of new measures that significantly expand the group’s controls on the export of chemical and biological weapons-related goods and technology.

The 33 members of the group meet annually to coordinate their export control policies on items that importers could use in chemical or biological weapons programs. Members are expected to deny export license requests for items included on “control lists” when there is a concern that the items would be used in such programs.

Some of the new measures have been in the works since last year’s meeting in October, while others have been pursued for even longer. The events of September 11 and the anthrax-laced letter attacks that followed gave impetus to finalize the regulations, according to Western officials. “There was a great deal of willingness to expand the AG’s controls and to bring the Australia Group into the 21st century,” one official said.

Prior to the June meeting, the group had controlled chemical precursors, chemicals that can be used in chemical weapons production; dual-use biological equipment, which can be used for either weapons or civilian purposes; dual-use chemical manufacturing facilities, equipment, and related technology; plant pathogens; animal pathogens; and biological agents. At its latest meeting, the group added controls on biotechnology that could be used to make biological weapons production equipment. This addition controls “the equipment that can make the equipment,” the official explained.

Previously, the group’s control lists had been geared toward preventing states from acquiring militarily useful material. The group is now trying to increase its focus on terrorists, the official said. For example, at its latest meeting the group expanded its list of controlled toxins from 11 to 19 and lowered the size of exportable fermenters, which can be used to produce biological weapons.

These modifications “take into account that a terrorist doesn’t need to get the worst of the worst,” the official said. “All you need is something pretty bad and you can cause a lot of harm and a lot of panic. So, the expansion of the list is, at least in large part, in response to the need to look at the terrorist angle.”

The group also concluded a set of guidelines that outlines criteria for evaluating export requests and includes a “no undercut” agreement. Under this provision, members pledged not to approve a particular export to a specific country that another member had previously denied without first consulting with that member.

The guidelines also include a “catch all” requirement. This provision requires members to be able to regulate any export, regardless of whether it appears on the group’s control lists, if an importer could use it in a chemical or biological weapons program. Also, exporters in member states must inform their governments if they are aware that an importer intends to use any import in a chemical or biological weapons program. In such a case, the government will decide whether to control the export.

Members must now also be able be control the spread of technology by “intangible” means. For instance, a company could be required to obtain government authorization before transmitting abroad, by telephone or fax, technology that could be used in a chemical or biological weapons program.

The United States and most other participants already have “catch all” and intangible control measures in place, but the new requirements will force new members to establish the same controls and will help set standards for the group, according to a U.S. official. The Australia Group is the first export control group to require its members to implement such controls.

The group also initiated a process to make the review of its control lists more intense and “high profile,” the U.S. official said.

Australia Group Concludes New Chem-Bio Control Measures

Washington Levies Sanctions for WMD-Related Transfers to Iran

June 2002

Alex Wagner

The Bush administration imposed sanctions on 12 Chinese, Moldavian, and Armenian firms and individuals May 9 for transferring items to Iran that could assist Tehran with missile development or the production of chemical or biological weapons.

The administration levied the sanctions under the Iran Nonproliferation Act of 2000, which mandates penalties for entities that transfer to Iran equipment and technology controlled under multilateral export control regimes. These informal arrangements include the Australia Group and the Missile Technology Control Regime, which seek to coordinate member states’ policies on chemical and biological weapons-related and missile-related exports, respectively.

The sanctions, which are effective for two years, specifically bar the U.S. government from providing assistance to or engaging in business with any of the sanctioned entities, and they effectively prevent U.S. companies from doing so. Several of the entities are already under U.S. sanctions, but at a May 16 press conference State Department spokesman Richard Boucher said that imposing further penalties served to extend the time the entities remain under sanctions.

Little information about the transfers that triggered the sanctions is publicly available. According to a U.S. official, the State Department is “not in a position to describe the transfers or the roles of the entities in them.”

However, according to intelligence officials cited in a May 20 Washington Times article, some of the transfers by Chinese entities involved glass-lined equipment, which could be used while developing chemical weapons. The report also cited officials claiming that other Chinese entities were sanctioned for selling cruise missile components to Iran.

Of the eight penalized Chinese entities, Liyang Chemical Equipment Company, China National Machinery and Electric Equipment Import and Export Company, and Chinese citizen Q. C. Chen were sanctioned in January for transfers controlled by the Australia Group. At that time, the State Department said Chen had provided assistance to Iran’s chemical weapons program. (See ACT, March 2002.)

The administration is also sanctioning Zibo Chemical Equipment Plant, most likely for chemical weapon-related transfers; Wha Cheong Tai Company; China Shipbuilding Trading Company; China National Aero-Technology Import and Export Corporation; and China Precision Machinery Import/Export Corporation, which was sanctioned in June 1991 for transferring M-11 short-range missiles to Pakistan.
The Chinese Foreign Ministry denounced the U.S. sanctions as “unreasonable” and emphasized Beijing’s strict adherence to its international export control obligations.

Although Chinese entities have been extensively penalized in the past for transfers of weapons of mass destruction-related technology to the Middle East, the new measures mark the first time that Moldavian and Armenian entities have been sanctioned.

A May 9 Reuters report quoted a senior administration official suggesting that the Armenian and Moldavian companies were fronts for Russian entities. However, in an interview another administration official denied the connection, stating that there is “no evidence that these entities are acting as fronts for other entities or any government.”

Citing Moldavian government sources, BASA-press, a Moldavian news agency, reported on May 17 that one of the newly sanctioned companies, Cuanta, SA no longer exists. The report described Cuanta as a military research facility that was once a manufacturer of sophisticated telecommunications systems for guided missiles. The Bush administration also sanctioned Cuanta’s former manager, Mikhail Pavlovich Vladov.

Armenia’s Lizen Open Joint Stock Company and Armenian national Armen Sargsian were also penalized. At a May 18 press conference, Armenian Foreign Minister Vardan Oskanian confirmed that Lizen sold certain materials to Iran but said the company did not intend “to assist the weapons of mass destruction production or research in other countries.” Oskanian said the company was “probably told at some point that it could lead to problems for them, but, nevertheless, they apparently chose to go ahead with the sale, and they are now included in that list.”

Washington Levies Sanctions for WMD-Related Transfers to Iran

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