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In these cases, the Pentagon does not support these types of mission requirements in their stockpiles, or in their annual budget. Both methods have existed for decades, but a novice to international sales has a steep learning curve regarding the complexities of each. As Fiscal Year (FY) 2017 comes to a close, FMS sales total roughly $64 billion, surpassing the previous record of $67.8 billion in total sales in FY 2012. All rights reserved. The opinions and conclusions in this paper are those of the author and are not intended to represent the official position of the DOD, USAF, or any other government agency. This chart explains the main differences between Foreign Military Sales (FMS) and Direct Commercial Sales (DCS). As part of this diverse network, over 1,560 corporate and 63,800 individual members are actively developing best practices, initiatives, technology, and products in defense with continued guidance and feedback from key stakeholders. FMF funds purchases are made through the Foreign Military Sales (FMS) program, which manages government-to-government sales. U.S. Defense companies have two main avenues for selling on the international market: Direct Commercial Sales (DCS) and Foreign Military Sales (FMS). The Department of Commerce’s Bureau of Industry and Security (BIS) grants export licenses to more commercial and “dual-use” defense products and services on the Commerce Control List (CCL), pursuant to the Export Administration Regulations (EAR). US DOD procures the defense articles under the same contractual provisions used for all DOD procurement. While the U.S. government contracts out to the defense industry on a competitive or sole-source basis, it may also sell directly from its own stockpiles. Unlike DCS, with FMS the foreign government has a contract with a US contractor The USG is not involved in the sale (although the vendor is required to comply with U.S. regulations regarding military exports). The Vendor is responsible for submitting a completed DSP-83. Foreign Military Sales vs Direct Commercial Sales Economic Overview U.S. aerospace and defense exports (1) sustain a domestic workforce in the manufacturing sector, (2) support national security programs through the foreign military sales (FMS) and direct commercial sales (DCS) processes, and (3) narrow the U.S. trade deficit gap. Under the AECA, there are three main authorities through which the United States can provide defense articles or services to another country: government-to-government Foreign Military Sales (FMS); licensed exports of direct commercial sales (DCS); and the lease of defense articles. the Foreign Military Sales program (FMS), through which the U.S. government procures defense articles as an intermediary for foreign partners. Our mission is to ensure the continued existence of a viable, competitive national technology and industrial base, strengthen the government-industry partnership through dialogue, and provide interaction between the legislative, executive, and judicial branches. However, as foreign competitors move into the global aerospace and defense market more vigorously, several factors will affect (and are affecting) the future long-term presence of the United States: 2101 Wilson Blvd, Suite 700 The FMS program’s overriding purpose is to build relationships with foreign countries by contracting on their behalf with industry providers. The Vendor negotiates with the Customer. The US DOD will negotiate with the Customer on behalf of the Vendor. We are also authorized to provide EDA under the FAA and to approve third-party transfer requests under both the … Foreign governments buy billions of dollars of defense equipment and services through the U.S. Defense Department's foreign military sales program. The U.S. government takes on more of the contractual risk than the customer in the short run, and supports the sustainment of the defense system in the long run. Check out our, Foreign Military Sales Sole Source Requirements Updated, Foreign Military Sales Admin Fee Decreases to 3.5%; Small Case Fee Eliminated. In 2016 alone, aerospace and defense exports reduced the overall deficit by $80-90 billion dollars. NDIA Affiliates are subsidiary organizations that focus on specific areas and missions related to it's community of interest. American arms manufacturers have two major channels through which they can sell major weaponry to foreign countries: foreign military sales ("FMS"), in which a government-to-government agreement is negotiated by the Pentagon; and direct commercial sales ("DCS"), in which industry negotiates directly with the purchasing country and must apply for a license from the State Department. *FREE* shipping on qualifying offers. Defense technology transfers equip our international friends and allies with capabilities needed to address regional and global security concerns. LMDefense, LLC is a registered broker for defense articles and services. Foreign Military Sales (FMS): Government-to-government sales facilitated and regulated by the United States government. These organizations are driving the future of defense through education, access, and collaboration. U.S. Government (USG) is not involved in the transaction, and does not act on behalf of the Customer or Vendor should complications arise. tel: (703) 522-1820, Chemical Biological Defense Acquisition Initiatives Forum, Industrial Committee of Ammunition Producers, Industrial Committee on Test and Evaluation, Trusted Microelectronics Joint Working Group, ADAPT - Agile Delivery for Agencies, Programs and Teams. Abstract : The transfer of arms from the U.S. to other countries under the Security Assistance Program is done in two basic ways: government-to-government Foreign Military Sales (FMS), and contractor-to-government Direct Commercial Sales (DCS). Direct Commercial Sales United States Government LOA CONTRACT Foreign Military Sales United States Contractor Foreign Government CONTRACT United States Government EXPORT LICENSE OFFSET AGREEMENT •The AECA requires that the FMS program must be conducted at no cost to the U.S. Government and may not be supported by appropriated funds. 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