End-Use Monitoring (EUM)

& Third Party Transfer

of U.S.-Origin Defense
Equipment

End-Use Monitoring
(SAMM C8.1)

... program designed to verify that

defense articles or services
transferred by the United States
Government (USG) to foreign
recipients are being used in
accordance with the terms and
conditions of the transfer agreement
or other applicable agreement.

U.S. Arms Transfer Programs

Military Assistance Program (1950-81)

MAP merger (1981-90)
FAA, Sec. 506 drawdown authority
FAA grant EDA programs
Foreign Military Sales (FMFP grant and
loan)
Foreign Military Sales (cash)
Direct Commercial Sales (USML & CCL)

Legal Basis For Program

Section 40A of the Arms Export Control Act

enacted in 1996
The President shall establish a program that
provides for End-Use Monitoring in order to
improve accountability of Defense articles
sold, leased, or exported
Requires monitoring of U.S. arms transfers
by providing reasonable assurance that
recipients comply with USG export control
requirements regarding the use, transfer,
and protection of defense articles and
services

USG Monitoring Programs

Defense Department
Golden Sentry

State Department
Blue Lantern

Commerce Department
No official name

Golden Sentry Program

Objectives

Technology Security
Impede access of potential adversaries to
significant technologies, including those which
contribute to proliferation of Weapons of Mass
Destruction (WMD)
Industrial Base
Global competiveness, technology advantage
Compliance
Encourage Partner Nations support for U.S.
laws and regulations regarding use, transfer,
and security of defense equipment

Levels of Monitoring (1)

(SAMM C8.3 and C8.4)

Routine EUM:
Required for all defense articles and services
provided via government-to-government
programs
ODC-Jakarta personnel are required to
observe and report to PACOM, DSCA, and
DoS any potential misuse or unapproved
transfer
In conjunction with other security cooperation
functions
ODC-Jakarta must document Routine EUM on
at least a quarterly basis and maintain
records for five years.

Routine end-use monitoring

General and specific categories of defense items
Aircraft (fighters, helicopters, etc.), Missiles, Ships, Combat Vehicles,
Weapons, Ammunition, Communication, Detection, and Coherent
Radiation Equipment
Specific details (MASL, Case, Line, Quantity, etc.) provided for each

Levels of Monitoring (2)

(SAMM C8.3 and C8.4)

Enhanced EUM (EEUM):

Based on the principle of trust with
verification
Defense articles and services or individual
transfers specifically designated for EEUM for
all FMS-eligible countries
Specialized physical security and
accountability notes in LOAs
ODC-Jakarta will provide Indonesia with
formal notification of any findings noted
during EEUM checks; Indonesia has 60 days
to correct

Levels of Monitoring (3)

(SAMM C8.3 and C8.4)

Inventories by serial number

USG employee and US citizen must

conduct inventories

Verification/recording of the equipment

final disposition (e.g., fired, lost,
destroyed)

Includes physical security assessments

of facilities

Levels of Monitoring (4)

(SAMM C8.3 and C8.4)

ODC Personnel perform EEUM checks

during collaboratively scheduled visits to

military installations

Conduct 100% inventories by serial number

of EEUM-designated articles

Within 90 days of equipment arrival in-

country & annually thereafter. See SAMM

C8.4.1.2 for case-by-case exceptions.

Annotate inventory in SCIP

Review accountability procedures

Enhanced End-Use Monitoring (EEUM)

Current EEUM Items

(SAMM C8.T4)

Advanced Medium Range Air-to-Air Missiles

AMRAAM (AIM-120)
AIM-9X Advanced Sidewinder Air-to-Air Missiles
Communication Security (COMSEC) Equipment
Enhanced Targeting Data (ETD)
Harpoon Block II Missiles
Joint Air-to-Surface Standoff Missiles (JASSM)
Joint Standoff Weapon (JSOW)
Large Aircraft Infrared Countermeasures (LAIRCM)
Missiles and Command Launch Units
Night Vision Devices

Current EEUM Items (contd)

Standoff Land Attack Missile Expanded Response

(SLAM-ER)Missiles
Standard Missile-3 (SM-3)
STINGER Missiles and Grip Stocks
Tomahawk Missile
TOW-2B Missiles
Theater High Altitude Area Defense (THAAD)
Unmanned Aircraft System (UAS) --PredatorGlobal
HawkReaper

Cover
Page
Case
Case
Identifier
Identifier

LOA Entries for EUM

17

EUM LOA Terms and Conditions

2.7 Pursuant to section 505 of the Foreign Assistance Act of
1961, as amended (FAA)(22U.S.C. 2314), and section 40A of
the AECA (22U.S.C. 2785), the USG will be permitted upon
request, to conduct, end-use monitoring (EUM) verification
with respect to the use, transfer, and security of all defenses
articles and defense services transferred under this LOA. The
Purchaser agrees to permit scheduled inspections or
physical inventories upon USG request, except when other
means of EUM verification shall be mutually agreed. Upon
request, inventory and accountability records maintained by
the Purchaser will be made available to U.S. personnel
conducting EUM verification.

Defense Security Cooperation

Agency (DSCA) Responsibilities

Administer/manage DoDs EUM program

Develop & disseminate EUM policy and
guidance
Coordinate/approve all LOA EEUM
notes/provisos
Ensure compliance with DoDs EUM program
Participate in EUM investigations
Publish lessons learned / best practices
Provide annual report to Congress

Types of EUM Visits from DSCA (1)

(SAMM C8.5)

Familiarization Visits and Regional Forums

Indonesia, ODC-Jakarta, PACOM, and DSCA
work together to mutually develop effective
EUM compliance plans
May be prompted by the introduction of new
equipment or other changes in theatre
Determine requirement(s) for future
Compliance Assessment Visits
Compliance Assessment Visits
Review and Assess ODC-Jakarta and
Indonesia compliance programs
FY 17: Q2 (Jan-Mar 2017)

Types of EUM Visits from DSCA (2)

(SAMM C8.5)

EUM Investigation Visits

Investigate possible violations of AECA or
FAA
Prompted by information reports or other
sources
Closely coordinated with Indonesia and
ODC-Jakarta
Directed by DoS

MILDEP & IA Responsibilities

(SAMM C8.T2)

Identify sensitive technologies and defense

articles to be candidates for EEUM
Develop non-standard notes for articles/services
requiring physical security & accountability
procedures
Provide delivery records w/serial #s of all EEUM
items to ODC-Jakarta and Indonesia (also
include in SCIP)
Maintain delivery and inventory records of EEUM
items until final disposal/disposition

Area Combatant Commands

Responsibilities (PACOM)
(SAMM C8.T2)

Maintain a Golden Sentry POC

Provide Regional EUM guidance
Supervise execution of EUM program
Support Regional Forums with DSCA
Assess effectiveness of EUM
compliance
Ensure all EUM activities are reported
Plan and program funding requirements

ODC-Jakarta Responsibilities (1)

(Performed by a USG employee who is also a U.S. citizen - SAMM C8.T2)

Designate a primary EUM Point of Contact

Conduct EEUM inspections

Report possible violations regarding end use, transfer

or security to Department of State (PM/RSAT), DSCA
(Programs Directorate), and PACOM

Develop EUM Standard Operating Procedures & NVD

Control Plans
Establish/maintain the EEUM database
Assist Indonesia in submitting third party transfer
and change of end-use requests; verify/document
item disposal (See SAMM C8.4.1.4)

ODC-Jakarta Responsibilities (2)

(LE Staff authorized to perform inherently governmental
duties, or a U.S. contractor when directly supervised by a
USG employee - SAMM C8.T2)

Report immediately to DSCA and annotate the

destruction or loss of any EEUM-designated
item in the SCIP-EUM database (e.g., active,
expended, destroyed, etc.)
Review LOAs for notes or provisos requiring
specific physical security or accountability
procedures
Conduct Routine EUM inspections

ODC-Jakarta Responsibilities (3)

(LE Staff authorized to perform inherently governmental
duties, or a U.S. contractor when directly supervised by a
USG employee - SAMM C8.T2)
Capture all costs for conducting EEUM activities
Support Golden Sentry and Investigative visits
Attend regional EUM Forums
When directed by the Chief of Mission, on a case-bycase basis, conduct Blue Lantern end-use checks
Respond to queries pertaining to the shipping, receipt,
use, or disposal of defense articles and services
provided to host nations

Indonesia
EUM Responsibilities (1)

Demonstrate support of U.S. principles,

laws, regulations, policies and practices
Comply with the requirements embodied
in signed agreements for:
Third party transfer
T
End-use
U
Security / Protection
P

Indonesia
EUM Responsibilities (2)

Maintain good interface

Develop EUM SOPs with ODC-Jakarta
Maintain good internal accountability
Keep records of
Inventories
Items

Receipt Date
Consumed
Expended
Damaged or destroyed
Transferred
Change of end Use

EUM Visits

EUM Visits

DoS Blue Lantern EUM Program

Focuses on monitoring Direct Commercial

Sales (DCS) of defense articles by U.S. Industry
to a foreign government.

Initiated by DoS in 1990 for DCS

Systematic process aimed at enforcing the

AECA and the ITAR

Blue Lantern EUM Program

DoS PM/DDTC approves the export license and

primarily focuses on pre-delivery controls
(licensing checks) and limited post delivery
checks.

Country POCs are located in the Embassy and

work for the Ambassador/Department of State

SCOs can assist as requested by Amb

Track expenses in SAARMS

Department of Commerce (DoC) EUM

Program
Focuses on monitoring Commerce Control List

(CCL) item (some are Dual-Use)

transfers by U.S. industry to a foreign government
via the Export Administration Regulation (EAR)

Three phases
Export license approval
Pre-delivery controls (licensing checks)
Post delivery checks
Performed by Bureau of Industry and Security

(BIS) Attaches, Sentinel Teams from DoC BIS

and U.S. Foreign and Commercial Service
Officers

Third Party Transfers

All U.S.- Origin Defense Articles, Services,

Training, or Data Require USG
Authorization (DoS PM/RSAT or DDTC)
Before Transfer or Sale

Divesting government must submit request to the USG

HOW? See Advance Sheet addendum on TPT

Critical To USG Decision to

Approve / Deny Transfer

The USG will only consider a third-party

transfer if the USG itself would transfer the
Defense Articles / Services to the proposed
recipient

Third Party Transfers

SAMM C.8, T7 Questionnaire

Helpful Hints

Provide a complete & detailed questionnaire

the more information, the better!

Include ALL private companies that will have

access to USML

Divesting government must obtain the required

end-use assurances from recipients before the
TPT can be processed

End Use Assurance (EUA)

End Use Assurances(EUA) from all

recipients, including any intermediaries,
must be included with the request

If recipient is a foreign private entity

EUA are required from the Country
exercising legal jurisdiction over the P/E
recipient

Blanket Assurances

Governments may sign blanket end-use, retransfer, and

security assurances to satisfy legislative requirements
for future government-to-government retransfers

Members can transfer among themselves when:

The original acquisition value of all transferred

articles does not exceed $7M

Classified defense articles (including classified

technical information) are not being transferred

The defense articles to be transferred are already in

the inventory of the proposed recipient (no first
introduction)

Red Flags Automatic Denials

SME to private entities with no specific

government end user contract
Aircraft parts to private entities with no
specific Government end-user contract (i.e.
warehousing or stock)
USML to private individuals (i.e. private
collection)
Section 126.1 of the ITAR (prohibited countries)

Types of Third Party

Transfers

(http://www.state.gov/t/pm/rsat/c14028.htm)

Government-to-Government
Private Entity
Disposal

Temporary Transfer

Coalition Operations
Refurbishment/Repair
Integration
Upgrades
Loans

Change In End-use

Training
Static Display
Demonstrations
Exhibits
Cannibalization (Grant items only)

Disposal

(http://www.state.gov/t/pm/rsat/c14028.htm)

Change in end-use for which prior consent from DOS is

required for non-consumable items

After an item has been demilitarized (IAW DoD Manual),

it is no longer a defense article and may be disposed of
without further U.S. involvement

Cannibalization is viewed as disposal if controlled

parts removal causes item migration to non-defense
article status

DoD disposal procedures are encouraged

DoD Manual 4160.28

2013 Third Party Transfer Completions:

Type of Transfers

U.S. Department of State

The transfer, sale, disposal or

change in end-use of any
U.S.-origin component
without USG authorization
is a
VIOLATION

Violation Penalties

The President and Congress have legal

authority to impose penalties
Law does not require imposition of specific
penalty
Penalties may range from suspension to
termination of Security Cooperation / Security
Assistance program(s)

Summary

Golden Sentry program focuses on Transfer, Use, and

Protection of US provided articles and services
Done poorly, EUM could affect national/regional
stability
EUM program helps preserve our tech advantages and
US industrial base
EUM program closely watched at PACOM and
Washington, DC
Potential violations adjudicated in Washington DC
many factors involved
Transfers/changes of end-use require USG approval
before the transfer

End-Use Monitoring
Third Party Transfer
of U.S.-Origin Defense
Equipment