H.R. 4233: AUKUS Reform for Military Optimization and Review Act

The AUKUS Reform for Military Optimization and Review Act, also known as the ARMOR Act, proposes several changes aimed at enhancing defense cooperation and trade between Australia, the United Kingdom, and the United States.

Key Provisions

• Policy on Extraterritoriality: The bill encourages the President to collaborate with the UK and Australia to develop policies that address issues related to extraterritoriality, which refers to the inefficiencies in defense repair, maintenance, and sustainment of defense articles and services not listed as excluded technologies.
• Expedited Export License Reviews: The bill expands the scope of expedited reviews for defense export licenses to include all exports and transfers (such as reexports, retransfers, and temporary imports) conducted wholly within or between Australia, Canada, the UK, and the US. This change aims to streamline the process for transferring defense articles and services among these nations.
• Reporting Requirements: The President must submit annual reports for 15 years following the enactment of the Act. These reports will provide updates on the expedited review process, the number of licenses issued, details about the principal applicants who received licenses, and a list of the defense articles and services licensed for export.
• Clarification of Congressional Notification: The bill clarifies that certain congressional notification requirements are not applicable to the export or transfer of defense articles or services between the US, UK, and Australia, which is intended to facilitate smoother defense trade among these countries.
• Review of Excluded Technologies List: The Secretary of State, in coordination with the Secretary of Defense, is required to annually review the Excluded Technologies List. This list includes items that require licensing review for national security reasons, ensuring that only necessary items remain under licensing requirements.

Objective

The primary objective of the ARMOR Act is to enhance military cooperation and streamline defense trade processes among Australia, the UK, and the US, thereby improving overall defense readiness and capabilities among these allied nations.

Potential Impact

The proposed changes could lead to increased efficiency in defense coordination and potentially boost the defense industry involving these three countries, making it easier for them to share critical defense technologies and resources.

Relevant Companies

• RTX (formerly Raytheon Technologies) - As a major defense contractor, RTX could significantly benefit from expedited export licenses for military equipment and technology shared with allied nations.
• LMT (Lockheed Martin) - Lockheed Martin’s operations could be positively affected by new opportunities for collaboration and sales of defense articles to Australia and the UK.
• BA (Boeing) - Boeing could see increased sales for military aircraft and support services as a result of enhanced trade relations and streamlined export processes.