Shaheen, Fischer Spearhead Legislation to Level the Playing Field for Smaller Defense Manufacturing Companies, Expedite Timeline to Get Products Off the Assembly Line

September 23, 2022

Shaheen’s legislation would finance exportability and interoperability features during the development of hardware to lower costs & accelerate the timeline for getting hardware off the assembly line to U.S. allies and partners. 

(Washington, DC) – Today, U.S. Senators Jeanne Shaheen (D-NH) and Deb Fischer (R-NE), senior members of the Senate Armed Services Committee, introduced the Defense Export Promotion of Relevant Technology and Supplies Act (Defense EXPORTS Act), new bipartisan legislation that would help level the playing field for smaller defense manufacturing companies by funding exportability and interoperability during development of hardware to expedite the timeline for getting urgently needed capabilities into the hands of U.S. allies and partners. 

Traditionally, industry develops and begins manufacturing a capability purchased by the Department of Defense (DoD) without establishing and building the necessary mechanisms for exportability (often referred to as “program protection”) and interoperability. This means that the manufacturing company goes through the entire development and manufacturing cycle before having to go back and reopen the technology to implement the needed export modifications. This approach not only means that delivery of exportable versions is often delayed but also drives a higher cost for the U.S. government and international buyers as the manufacturer must retroactively reengineer systems. Shaheen’s Defense EXPORTS Act would address these issues. 

“As the United States and its allies and partners face numerous security challenges around the world, it’s crucial for our defense industry to have the capacity and capabilities to meet the demand. We want the most innovative, cutting-edge technology to confront these threats and we must ensure that we can deliver those capabilities to our allies swiftly. That’s precisely what this legislation seeks to do,” said Shaheen. “By financing exportability and interoperability mechanisms at the front end of hardware development, we can expedite their development and production timelines and provide more opportunities for smaller companies to develop exportable variants of their technologies.” 

“Defense manufacturers face a number of challenges when trying to deliver weapon systems to our allies and partners in a timely fashion. This bill would shorten that timeframe by better incorporating exportability features into the design and development process of weapons systems. At a time of heightened instability, our allies and partners deserve better access to the cutting-edge technologies they need for their national defense,” said Fischer

The Defense EXPORTS Act would finance exportability and interoperability features during the development of the hardware, thereby lowering cost, accelerating the ability of that hardware to be sold to allies and partners and providing smaller programs with more accessible paths to receiving the necessary protections for export - traditionally something that is typically only assured for major programs developed by large companies.  

Specifically, the Defense EXPORTS addresses these issues by: 

  • Authorize the creation of a “Defense Exportability Transfer Account,” which would receive an initial appropriation of $50 million, with the expectation that it will become self-sustaining in the future; 
  • And allow funds in the account to be used for non-recurring engineering (NRE) and program protection strategies required to make current and future DOD systems exportable and coalition interoperable. 

Bill text of the legislation is available here. 

Senators Richard Blumenthal (D-CT), John Cornyn (R-TX) and Kevin Cramer (R-ND) are original cosponsors of the legislation. 

Senator Shaheen is a leader in the U.S. Senate to bolster the domestic stockpile and to address the urgent need amid Vladimir Putin’s war in Ukraine to address needs from the defense industry to supply U.S. and partners around the world with the military aid and technology needed to deter and defend aggression from adversaries. Earlier this month, Shaheen and Senator John Cornyn (R-TX) led the introduction of the Securing American Acquisitions, Readiness, and Military Stockpiles Act, which would give the DoD enhanced procurement authorities to quickly refill American defense stockpiles after the President provides aid to an ally or partner attacked by a foreign adversary, including replenishing America’s stockpiles after lethal aid was sent to Ukraine for defense against Russia. This legislation follows a previous bill by Senators Shaheen and Cornyn, the Ukraine Democracy Defense Lend-Lease Act, to establish a military lend-lease program to enhance security assistance to Ukraine. That bill was signed into law by President Biden on May 9, 2022. 

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