US Announces AUKUS Submarine Tech Deal, Considering ITAR Changes

As part of the AUKUS partnership, announced in 2021 (see 2302170022), Australia will buy “three Virginia class conventionally armed nuclear powered submarines” from the U.S. “with an option to buy two more if needed,” a senior administration official said during a March 12 call with reporters. The U.S. should be ready to deliver the nuclear-powered submarines to Australia within about 10 years, “much earlier than many had expected,” the official said, adding that Australia will also buy submarines from the U.K. and eventually produce its own.

Under the agreement, the three countries will deliver a "trilaterally-developed submarine based on the United Kingdom’s next-generation design that incorporates technology from all three nations, including cutting edge U.S. submarine technologies," the countries said in a joint statement released March 13. The deal "will involve a level of sensitive sophisticated technological cooperation that is almost without precedent," an official said.

The announcement comes amid recent criticism of U.S. defense trade regulations by industry and lawmakers, who said the ITAR unnecessarily prevents technology sharing within AUKUS. The Australian Strategic Policy Institute last month said the State Department’s International Traffic in Arms Regulations needs “major reform” (see 2302170022), and Rep. Mike Gallagher, R-Wis., recently said he’s working on a bill to revise the ITAR to allow the U.S. to better take advantage of AUKUS tech-sharing opportunities (see 2301270005).

The administration officials this week stressed that the ITAR won’t hinder the delivery of nuclear-powered submarine technology to Australia. “On the tech-sharing front, we're confident that we'll be able to go forward with this,” one official said.

But they also said the U.S. is looking to address broader issues posed by its trade regulations, adding that there are “additional technologies that will be involved in the AUKUS effort on advanced capabilities overall,” which “spans a wide range” of sensitive items.

“We are looking at what changes to our current export control arrangements would be appropriate to ensure that we're able to move at the speed of relevance in our cooperation with the U.K. and Australia in these areas,” the official said.

Without reform to its defense export controls, America will be “unlikely to see its allies either as capable or perhaps as willing to contribute to regional security,” Charles Edel, a senior adviser with the Center for Strategic and International Studies, said during an AUKUS press briefing hosted by the think tank last week. “[T]his is a question about whether there will be enough political pressure to force changes in the way the U.S. shares sensitive technology and collaborates with both Australia and Britain.”

Although Edel said the administration may be looking to relax certain technology sharing restrictions imposed on Australia and the U.K., he also said Congress has a “role to play.”

The House Foreign Affairs Committee last month advanced a bill that would direct the State Department to submit a report to Congress on “the advanced capabilities pillar” of AUKUS. The text of the bill, made public this week, would require the agency to provide information on the average processing times for defense-related export license applications involving Australia and the U.K., information on voluntary disclosures of ITAR violations, penalties involving the two countries and an “assessment of recommended improvements to export control laws.”

Several CSIS experts said the ITAR is overdue for reform. Emily Harding, a CSIS senior fellow, compared the ITAR to when “your toddler gets into your jewelry drawer, and takes your necklaces, and throws them all on the floor, and they turn into a gigantic knot.” You “can spend hours and hours trying to untangle that gigantic knot,” she said.

“Everybody agrees it’s a huge mess and that it’s silly, but all of the different pieces to it need to be untangled in a set of difficult steps,” Harding, a former National Security Council official, said of the ITAR. “And everybody wants it done, it just needs urgency, and I think it needs focus. And I’m not sure if it’s yet risen to that level. And it needs to.”

Max Bergmann, a CSIS expert and former State Department official, said “there’s a lot of dumb things about ITAR” but many of the restrictions serve a purpose. “We don’t want to be a country that is just blindly selling weapons and, frankly, losing control of some of our advanced military technology,” Bergmann said during the CSIS briefing. “And obviously in the case of the U.K. and Australia, that becomes just much less of a concern. And so a lot of these issues, particularly when it relates to the U.K. and Australia, should be resolvable.”

He also said export control regulations are “an issue that you’re constantly sort of addressing,” pointing to the fact that the Obama administration “spent eight years doing export control reform.”

“You’re sort of cutting back the weeds, but then they grow back,” Bergmann said. “So there’s a number of different factors that go into making this very difficult. But I think what’s really good is the administration recognizes it, everyone recognizes it, and it’s getting more priority than I think we were seeing before.”

The U.S. hopes more technology sharing with Australia, including the nuclear-powered submarines, will help “enhance deterrence in support of security and stability in the Indo Pacific,” an official said. “On technology sharing, Australia is one of our very closest allies. They have stood next to us in no shortage of events, and we feel very confident that they will take this unique capability in a responsible fashion.”