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AIA Welcomes State Department Proposal to Clarify Export Controls for Civil Aviation Manufacturers

April 14, 2008

A proposed rule issued Friday by the State Department could be an important step in modernizing the U.S. export control system and eliminating confusion for civil aircraft manufacturers, AIA President and CEO Marion Blakey said. Companies have been concerned for years over section 17(c) of the Export Administration Act that made it unclear whether their commercial products could be labeled as a military item as well. "Civil aircraft manufacturers must be able to assure customers that their commercial components will not be classified as military items," Blakey said. "Otherwise they risk being cut out of opportunities in the commercial marketplace." "This proposed rule, when finalized, will provide U.S. aerospace manufacturers with much needed clarity," Blakey said. "One of the strengths of U.S. aerospace is our ability to export, so resolving this confusing regulatory issue will be a significant boost over the long term. Preliminary figures from 2007 peg the industry's positive trade balance at $56.5 billion." AIA and its partners in the Coalition for Security and Competitiveness provided recommendations, including clarification of this issue, to President Bush last year. Many of the recommendations were included in the presidential directives on export control modernization released Jan. 22. This proposed rule is also in line with legislation proposed by Congressmen Donald Manzullo (R-Ill.) and Brad Sherman (D-Calif.) to improve the system. AIA will be providing comments to the State Department on the proposed rule before its May 12 deadline. AIA continues to work with the administration and Congress on other export control priorities, including ratification of the U.S.-UK and U.S.-Australian defense trade cooperation treaties and better management of the export licensing caseload for critical defense and security programs.