in effect
This is a final rule from the U.S. Department of State that permanently adopts, with some modifications, a temporary regulation issued in August 2024. It creates a formal exemption within the International Traffic in Arms Regulations (ITAR) that allows defense articles, defense services, and brokering activities to move among Australia, the United Kingdom, and the United States without requiring individual export licenses, as long as specific conditions are met.
The new ITAR Section 126.7 exemption eliminates the license requirement for qualifying defense trade transfers between “Authorized Users” — approved companies and government entities in Australia, the UK, and the US — operating within those three countries’ physical territories. A second, separate exemption is added covering reexports, retransfers, or temporary imports of defense articles specifically to support the armed forces of the three nations, including outside their home territories. An Excluded Technology List (Supplement No. 2 to Part 126) identifies categories of defense articles and services that are not eligible for the exemption and still require a license; the Department reports roughly 18% of relevant license requests would fall on that excluded list. Expedited license processing — 30 days for most applications, 45 days for others — is now applied based on the statutory eligibility criterion rather than the broader temporary practice used since September 2024. The rule also clarifies that dual nationals who are citizens of Australia or the UK (and a third country) may access classified defense articles under Section 126.18(e) if they hold a security clearance at the SECRET level or above recognized by one of the three governments.
U.S. defense companies and individuals registered with the Directorate of Defense Trade Controls (DDTC) who export to Australia or the UK can now transfer many defense articles and services to Authorized Users in those countries without applying for individual licenses. Australian and UK companies and government agencies that complete the Authorized User enrollment process — agreeing to compliance terms set by their respective governments — gain the ability to receive and re-transfer eligible U.S.-origin defense items within the three-country group without per-transaction U.S. license approval. Items on the Excluded Technology List remain subject to standard licensing, so exporters dealing in those categories (certain classified systems, missile-technology-designated articles, counter-space items, and others) are not affected by the exemption.