Balancing Secrecy and Oversight: Navigating Familiar Barriers to U.S. Arms Trade Transparency

Operational Security

The Department of Defense defines operational security (OPSEC) as a process to “reduce the vulnerability of US and multinational forces to successful adversary exploitation of critical information. OPSEC applies to all activities that prepare, sustain, or employ forces.”

Claims that excessive transparency could provide adversaries exploitable insights into U.S. or partner operations, capabilities, and planning have long justified limiting disclosure of key U.S. arms transfer and military assistance information. Though the U.S. government has not provided a consolidated view on the nature of the operations security (OPSEC) risks it weighs against transparency imperatives, U.S. officials have suggested these concerns include:

• Revealing gaps in partner capabilities;
• Providing adversaries the opportunity to prepare countermeasures to the introduction of new capabilities; and
• Disclosing the location or movements of U.S. and/or partner forces.

Additionally, though not directly an OPSEC concern in a typical sense, U.S. officials have also noted the diplomatic sensitivities surrounding the disclosure of security cooperation and assistance information – namely, the discomfort U.S. partners may feel in telegraphing information on their defense relationship with Washington. 

OPSEC, Revisited

OPSEC is an important defense priority and must be weighed judiciously against other imperatives. There is undoubtedly risk that information about operational deployments of key capabilities amidst ongoing hostilities, the presence or whereabouts of U.S. forces supporting capacity-building missions, or U.S. and partner troop movements could jeopardize the security of the United States and its partners. However, closer consideration of OPSEC realities related to arms transfers, the nature of certain information disclosures, and past U.S. government practice suggests that these concerns do not preclude improved transparency.

Public disclosure of individual assistance measures or arms transfers does not necessarily imply a gap in partner capabilities. Arms transfers occur in a variety of contexts and can relate to developing, sustaining, or expanding on a particular set of weapon systems, none of which preclude the existence of analogous capabilities. Conflating transfer information with a capability gap would represent a highly risky assumption on the part of an adversary. Similarly, even advance warning of the transfer of new capabilities does not necessarily provide an easy pathway for opponents to develop effective countermeasures. The development of countermeasures is a time-consuming process that likely draws on a far wider and deeper range of information and intelligence sources than would be reflected in more regular defense trade transparency mechanisms. As demonstrated in Ukraine, even very public disclosure of the introduction of new capabilities did less to aid in Russia’s development of countermeasures than did their adaptations arising from battlefield experience.

Additionally, not all transfers take place in high-risk OPSEC environments or represent information that is exploitable by adversaries. Routine transfers to longstanding partners, transfers of less sophisticated capabilities, or security cooperation activities with partners whose threat landscape does not involve near-peers are all unlikely to present acute OPSEC risks.

Even in cases where OPSEC risks are high, the U.S. government has demonstrated an ability to be remarkably transparent in its security cooperation and assistance activities. Though Ukraine is engaged in an industrial-scale, high-intensity conflict with a peer rival, the Biden administration has provided regular updates on the scale, scope, and nature of its arms transfer to Kyiv, suggesting that OPSEC concerns are manageable even in the most hostile environments.

Foreign Military Sales (FMS) – A process authorized by the Arms Export Control Act (AECA) by which foreign governments and international organizations can purchases defense articles, services, and training directly from the United States government. 

Relatedly, the inconsistency in the U.S. government’s invocation of OPSEC as a justification for limiting transparency raises questions. Foreign Military Sales (FMS) notifications, for example, which are often related to the transfer of highly advanced capabilities to partners facing complex security challenges, are made public. Similarly, the U.S. government frequently publicizes new transfers, partnerships, or the introduction of advanced capabilities to important theatres. Indeed, the U.S. government has frequently noted the important diplomatic signaling value that well-publicized arms transfers can have. 

Tailoring Transparency for OPSEC

Vitally, much of the information that would improve public reporting and oversight over U.S. security cooperation and assistance is not of the kind that would jeopardize OPSEC. Improved transparency measures could be tailored to navigate these concerns:

• Public disclosure of security cooperation and assistance information need not include details on troop movements, operational deployments, or other geo-specific details.
• Pre-delivery information on arms transfers could focus on the dollar value and type of security cooperation or assistance activities, which is highly unlikely to present any exploitable information to adversaries or jeopardize OPSEC.
• The number or volume of defense articles and services transferred could be reported post-delivery, limiting the degree to which it might signal a capability gap. 

The current practice of information transparency assumes a blanket OPSEC risk that broadly constrains the disclosure of security cooperation information. In line with its practice of evaluating the risks and merits of arms sales themselves on a case-by-case basis, the U.S. government should undertake case-by-case judgments on the release of information which weigh OPSEC requirements with transparency imperatives. In cases where OPSEC risks are minimal, the U.S. government should endeavor to include as much information as possible in its public reporting, including the type, number, and value of defense articles or services transferred.

Proprietary Commercial Information

Direct Commercial Sales (DCS) –sales of defense articles or defense services made under a Department of State issued license by U.S. industry directly to a foreign buyer, but which is not administered, managed, or negotiated by the U.S. Government. It is the counterpart to the aforementioned Foreign Military Sales (FMS), under which the U.S. government sells defense articles, services, and training directly to foreign governments or international organizations.

The U.S. government has long claimed that it is constrained in its ability to offer any further information on direct commercial arms sales (DCS) – arms sales licensed by the U.S. government but negotiated and managed directly between U.S. industry and foreign recipients – because of its obligation to protect companies’ proprietary commercial information. The U.S. government has not specified exactly what information it considers proprietary, nor the exact nature of the risks further disclosure could mean for commercial partners. However, officials have suggested that the concerns center on revealing information which might place industry partners at a competitive disadvantage.

In this framing, the most pertinent information would likely be related to the pricing of specific capabilities within a DCS case, which – according to the U.S. government – could allow domestic or foreign competitors to undercut proposed or ongoing sales. When it comes to congressional notifications, officials have suggested that, since these relate to proposed sales that have yet to be completed, disclosing information such as pricing could threaten the deal before it is concluded. The U.S. government has also suggested that its obligation is not just ethical but based upon specific legal commitments.

Proprietary Commercial Information, Revisited

The U.S. government’s concerns around the potential commercial risks associated with disclosing pricing information may not be so severe in practice. Moreover, tailored approaches to improving DCS transparency could navigate these concerns.

Pricing information is made available for government-to-government foreign military sales (FMS) – which still involve defense industry partnerships – with little discernable damage to private competitive advantage. Moreover, information on DCS pricing is often disclosed in other forums, albeit in a disaggregated manner that complicates efforts to leverage the information for public oversight or research. Industry representatives have also suggested their concerns around price disclosure are minimal and not a priority in terms of protecting their commercial interests.

The Arms Export Control Act (AECA) is the basic law authorizing the President to control the trade in defense articles and services. The Department of State has been delegated responsibility for the commercial export and temporary import of defense articles and services governed by 22 U.SC. 2778 of AECA.

The International Traffic in Arms Regulation (ITAR) is the set of U.S. government regulations administered by the Department of State that implements these AECA requirements and lays out processes and rules for commercial exports of defense articles and services.

Claims by the U.S. government that further DCS disclosures would violate unspecified legal obligations seem to be based on a highly restrictive interpretation of provisions in the Arms Export Control Act (AECA) and its operationalization in the International Traffic in Arms Regulation (ITAR).  Section 38(e) of the AECA states that, as an element of the President’s enforcement authority, “the names of the countries and the types and quantities of defense articles for which licenses are issued under this section shall not be withheld from public disclosure unless the President determines that the release of such information would be contrary to the national interest.”¹ Sec. 36 pp. 37 of the AECA (italicization added). However, §120.21 of the ITAR explains that the U.S. government understands this language to suggest that “information obtained for the purpose of consideration of, or concerning, license applications shall be withheld from public disclosure unless the release of such information is determined by the Secretary of State to be in the national interest.” In other words, the ITAR interpretation goes beyond the context described in the AECA.

Such an interpretation also seems to contradict the explicit requirement in the AECA that the President provide DCS notifications in an unclassified format unless such disclosures “would be clearly detrimental to the security of the United States.”² Sec. 36 pp. 37 of the AECA. Indeed, across the AECA, the President is mandated and provided the authority to make public information on U.S. arms transfers so long as such disclosures would not represent a national security threat – as opposed to a commercial risk.

Tailoring Transparency for Proprietary Commercial Information

Even if the proprietary commercial limitations are taken at face value, tailored transparency could navigate these concerns:

• In addition to the recipient, public DCS notifications could include dollar values of the proposed sale but be less specific on the number of items or scale of services being provided, or vice versa. 
• Public DCS notifications could substitute US Munitions List sub-categories for specific make or model of capabilities on offer.
• As an interim measure, public DCS notifications could include the threshold value of the proposed licenses.

Vitally, following the conclusion of a DCS agreement, concerns around competitive disadvantage should be relatively ameliorated, and thus provide the space to make full license information publicly available – to include dollar value, make, model, and number of items – in an organized, easily accessible, and unclassified format.

Conclusion

OPSEC and proprietary commercial barriers to transparency are undoubtedly grounded in legitimate concerns and obligations. However, these concerns have frequently been invoked in excessively broad terms with insufficient consideration of the practical application of potential transparency measures. In most cases, proposals for improved public reporting on security cooperation and assistance can thread the needle between legitimate OPSEC and proprietary commercial concerns on the one hand and transparency on the other. At the same time, the U.S. government should consider more critically the validity of these concerns, especially when applied too generally. Rather than a default invocation of proprietary commercial or operational security concerns as a blanket justification for opacity, policymakers should approach these issues more deliberately and on a case-by-case basis. In the meantime, contextualizing when and how these concerns become operative and providing specifics on how the U.S. government interprets its obligations to steward these responsibilities would allow other stakeholders to engage in a more informed dialogue on how to align important transparency measures with specific and legitimate OPSEC and commercial constraints.