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 What
is Security Cooperation?
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1. The Department of Defense (DoD) broadly defines Security Cooperation (SC) as those activities conducted with allies and friendly nations to:
� Build relationships that promote specified U.S. interests
� Build allied and friendly nation capabilities for self-defense and coalition operations
� Provide U.S. forces with peacetime and contingency access
What
is Security Assistance?
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2.
As a subset of SC, Security Assistance (SA) encompasses a group of programs, authorized by law, through which the U.S. Department of Defense (DoD) or commercial contractors provide defense articles and services in support of national policies and objectives.
SA programs allow the transfer of defense articles and services to international organizations and friendly foreign Governments via sales, grants, leases, or loans to help friendly nations and allies deter and defend against aggression, promote the sharing of common defense burdens and help foster regional stability. SA includes such diverse efforts as the delivery of defense weapon systems to foreign governments, U.S. Service school training to international students, U.S. personnel advice to other governments on ways to improve their internal defense capabilities, and U.S. personnel guidance and assistance in establishing infrastructures and economic bases to achieve and maintain regional stability. When the U.S. assists other nations in meeting their defense requirements, it contributes to its own security.
Foreign Military Sales (FMS), Foreign Military Financing (FMF) grants or loans, and International Military Education and Training (IMET) are key programs included within Security Assistance. IMET is conducted solely on a grant basis. FMS can be conducted using host nation funds, donor funds or FMF.
Who Manages
SA? return
3. The U.S. Congress establishes the laws, authorizes programs, appropriates funds, and has an oversight role in SA. The principal legislated responsibilities fall to the Department of State (DoS) and DoD.
The Secretary of State provides continuous supervision and general direction for SA, including determining whether what SA programs a given country will have, as well as their scope and content. The Secretary of Defense
(SecDef) implements programs to transfer defense articles and services on a government-to-government basis.
The Defense Security Cooperation Agency (DSCA) is the principal DoD organization through which the SecDef carries out responsibilities for SA. Within DoD, the Military Departments (MILDEP) and other implementing agencies manage individual country programs, including the development of Letters of Offer and Acceptance (LOA), and the delivery of defense articles and services under those LOAs. Financial management of accepted LOAs is a responsibility of the Defense Finance and Accounting Service (DFAS).
Usually a Security Assistance Organization (SAO), under the direction of the chief of the U.S. diplomatic mission, conducts the in-country management of each recipient nation's SA programs. The SAO provides this oversight in conjunction with its host nation counterparts, the country team within the diplomatic mission, the regional Combatant Commander
(COCOM) of the Unified Command, the Office of the Joint Chiefs of Staff
(JCS), DSCA, and the MILDEPs.
How Does FMS Operate?
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4. FMS is managed and operated by DoD on a no-profit and no-loss basis. Countries and international organizations participating in the program pay for defense articles and services at prices that recoup the actual costs incurred by the United States. This includes a fee (currently
3.8% of what the defense articles and/or services cost, in most instances) to cover the cost of administering the program.
When defense articles and/or services are required, the requesting country's representative provides a Letter of Request (LOR) to their U.S. counterpart. Copies are sent to the DoS Bureau of Politico-Military Affairs and the DSCA. The original is furnished to the DoD Military Department or other implementing Defense Agency that will prepare the response in the form of a LOA.
LOAs take three forms:
Defined Line. Certain defense articles and services can be provided only on Defined Line LOAs, which offer items at individually estimated prices and delivery dates. The U.S. Government, where necessary, in turn contracts for the defense articles and services that are required to
fulfill the LOA.
Blanket Order. Most repair parts and routine services can be offered under Blanket Order LOAs. These LOAs are perfectly suited for addressing recurring needs (i.e., where the customer will require additional defense articles or services on a periodic or frequent basis). Once established, the Blanket Order LOA reduces the time needed for processing an order and contracting for the items and/or services required.
Cooperative Logistics Supply Support Arrangement (CLSSA). Under the CLSSA, the customer acquires access to the U.S. logistics pipeline for the support of specified end items. This allows supply of repair parts from existing U.S. stocks, without waiting for completion of a procurement cycle. CLSSAs are normally established for countries with well-developed logistics systems and with larger quantities of end items to be supported.
What is Available Under
SA Programs?
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5. Defense articles, including major defense systems, subsystems, support equipment, repair parts, and publications are available under SA. Defense services, including training in U.S. military schools or through mobile training teams, construction, engineering, contract administration, program management, technical support, and repair are also available. To encourage standardization and interoperability among U.S. and SA countries, FMS normally involves the transfer of those articles that have been fielded by U.S. forces. While sometimes available through FMS, nonstandard articles or services are normally acquired commercially.
Under certain conditions, customers can elect to co-produce or co-assemble defense articles in lieu of transfer. Also, defense articles are occasionally leased to customers instead of sold.
What Are the Differences
Between FMS and Direct Commercial Sale of U.S. Defense Articles or
Services? return
6. With few exceptions, the U.S. does not care whether a customer acquires its defense articles and services under FMS or through Direct Commercial Sales (DCS).
In general, LOAs promote standardization (by providing customers with defense articles identical to those used by U.S. forces), provide contract administration services which may not be readily available otherwise, and potentially help lower costs by consolidating FMS buys with U.S. purchases. DCS allow the purchaser more direct interface during contract negotiation (and likely more opportunity for firm-fixed priced contracting), and acquire non-standard defense articles where special requirements demand tailoring the articles to meet a particular need.
One common misperception: Although the extent of DoD involvement is different, technology release approvals, and third country transfer approval requirements are the same for both methods of purchase.
Where Can I get
Additional
Information?
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7. The following publications are recommended.
Last revised: August 15, 2012
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