TREATIES AND OTHER INTERNATIONAL ACTS SERIES 09-417.1 

________________________________________________________________________ 

DEFENSE 

Cooperation 

 Memorandum of Understanding 

Between the 

UNITED STATES OF AMERICA 

and AUSTRALIA 

Signed at Washington and Canberra 

April 3 and 17, 2009 

 with 

Annexes 

 
 NOTE BY THE DEPARTMENT OF STATE 

 Pursuant to Public Law 89—497, approved July 8, 1966 

(80 Stat. 271; 1 U.S.C. 113)—

“. . .the Treaties and Other International Acts Series issued 

under the authority of the Secretary of State shall be competent 

 evidence . . . of the treaties, international agreements other than 

treaties, and proclamations by the President of such treaties and 

international agreements other than treaties, as the case may be, 

therein contained, in all the courts of law and equity and of maritime 

jurisdiction, and in all the tribunals and public offices of the 

United States, and of the several States, without any further proof 

or authentication thereof.” 
 AUSTRALIA 

 Defense: Cooperation 

 Memorandum of understanding signed 

 at Washington and Canberra 

 April 3 and 17, 2009; 

 Entered into force April 17, 2009. 

 With annexes. 
MEMORANDUM OF UNDERSTANDING

BETWEEN

THE DEPARTMENT OF DEFENSE

OF THE UNITED STATES OF AMERICA

AND

THE DEPARTMENT OF DEFENCE OF AUSTRALIA

CONCERNING COOPERATION IN THE

P-8A POSEIDON SPIRAL 1 DEVELOPMENT

PROGRAM

Certified to be itrue copy:

Phil Wheeler

International Agreements Negotiator

Navy International Programs Office
TABLE OF CONTENTS

INTRODUCTION

SECTION I

DEFINITIONS AND ACRONYMS 6

SECTION II

OBJECTIVES 12

SECTION III

SCOPE OF WORK 14

SECTION IV

MANAGEMENT (ORGANIZATION AND RESPONSIBILITY) 16

SECTION V

FINANCIAL PROVISIONS 21

SECTION VI

CONTRACTING PROVISIONS 25

SECTION VII

INDUSTRIAL PARTICIPATION 29

SECTION VIII

PROJECT EQUIPMENT 30

SECTION IX

DISCLOSURE AND USE OF PROJECT INFORMATION 32

SECTION X

CONTROLLED UNCLASSIFIED INFORMATION 41

SECTION XI

VISITS TO ESTABLISHMENTS 43

SECTION XII

SECURITY 44

SECTION XIII

THIRD PARTY SALES AND TRANSFERS 47

SECTION XIV

LIABILITY AND CLAIMS 51

SECTION XV

PARTICIPATION OF ADDITIONAL NATIONS 52

SECTION XVI

CUSTOMS DUTIES, TAXES, AND SIMILAR CHARGES 53

SECTION XVII

SETTLEMENT OF DISPUTES 54

SECTION XVIII

AMENDMENT, TERMINATION, ENTRY INTO EFFECT, AND DURATION 55

ANNEX A

SYSTEM REQUIREMENTS AND AUSTRALIAN OPERATIONAL REQUIREMENTS58

ANNEX B

JOINT PROJECT OFFICE ORGANIZATION 60

ANNEX C

INVENTORY OF PROJECT EQUIPMENT EXCHANGES 61

2
ANNEX D

COOPERATIVE PROJECT PERSONNEL 62

3
INTRODUCTION

The Department of Defense of the United States of America (U.S.

DoD) and the Department of Defence of Australia (ADOD)

hereinafter referred to as the "Participants":

Recognizing the Exchange of Notes Constituting an Agreement

between the Government of the United States of America and the

Government of Australia Concerning Certain Mutual Defence

Commitments done at Sydney on December 1, 1995 (the Chapeau

Agreement) will apply to this Memorandum of Understanding (MOU);

Recognizing the Agreement Concerning Security Measures for the

Protection of Classified Information between the Governments of

Australia and the United States of America, which entered into

force November 7, 2002 (Security Agreement);

Recognizing the Implementing Arrangement between the Department

of Defence of Australia and the Department of Defense of the

United States of America concerning Industrial Security, which

entered into force February 8, 2007 (Security Arrangement);

Having a common interest in defense;

Recognizing the benefits to be obtained from standardization,

rationalization, and interoperability of military equipments;

Desiring to improve their mutual conventional defense

capabilities through the application of emerging technology;

Having a mutual need for the development of the maritime systems

to satisfy common operational requirements;

Having independently conducted studies, research, exploratory

development, and testing of the applications of various

technologies, recognize the benefits of cooperation in the

maritime domain;

Having established numerous data exchange agreements for the

exchange of Information concerning all aspects of the maritime

domain;

Recognizing the importance of cooperation between the

Participants' research and development organizations and

industries, and seeking to reduce barriers to that cooperation;

and

4
Desiring to cooperate on the P-8A Poseidon Spiral 1 aircraft,

missions systems, and associated ground systems with a view to

subsequent cooperation in production, support, and follow-on

development;

Have reached the following understandings:

5
SECTION I

DEFINITIONS AND ACRONYMS

The Participants have jointly decided upon the following

definitions and acronyms for terms used in this MOU:

Baseline P-8A

Poseidon

The P-8A weapon system as developed during

the P-8A System Development and

Demonstration phase, which involves the

modification and airworthiness certification

of an existing commercial aircraft, and

delivered for all production lots preceding

the introduction of capability developed

during Spiral 1. The P-8A weapon system

includes the air vehicle, mission systems,

training, sustainment plans, supporting

equipment and technologies, and

developmental and operational testing

leading to Initial Operating Capability.

Classified Official Information that requires

Information protection in the interests of national

security and is so designated by the

application of a security classification

marking. This Information may be in oral,

visual, magnetic, or documentary form or in

the form of equipment or technology.

Contract

Contracting

Any mutually binding legal relationship

under national laws that obligates a

Contractor to furnish supplies or services,

and obligates one or both of the

Participants to pay for them.

The obtaining of supplies or services by

Contract from sources outside the

governmental organizations of the

Participants. Contracting includes a

description (but not determination) of

supplies and services required, solicitation

and selection of sources, preparation and

award of Contracts, and all phases of

Contract administration.

6
Contracting Agency The entity within the governmental

organization of a Participant that has

authority to enter into, administer, or

terminate Contracts.

Contracting Officer A person representing a Contracting Agency

of a Participant who has the authority to

enter into, administer, or terminate

Contracts.

Contractor Any entity awarded a Contract by a

Participant's Contracting Agency.

Contractor Support Persons specifically identified as providing

Personnel administrative, managerial, scientific, or

technical support services to a Participant

under a support Contract.

Controlled Unclassified Information to which access or

Unclassified distribution limitations have been applied

Information in accordance with applicable national laws

or regulations. It could include

Information that has been declassified but

remains controlled.

Cooperative Project Military members or civilian employees of a

Personnel (CPP) Parent Participant assigned to the Joint

Project Office (JPO) or a facility of the

other Participant who perform managerial,

engineering, technical, administrative,

Contracting, logistics, financial, planning,

or other functions in furtherance of the

Project.

Defense Purposes Manufacture or other use in any part of the

world by or for the armed forces of either

Participant.

DON Department of the Navy

Designated Security The security authority designated by

Authority (DSA) national authorities to be responsible for

the coordination and implementation of

national industrial security aspects of this

MOU.

Financial Cost The maximum amount to which the financial
Ceiling contributions that one or both Participants

may contribute to this MOU without the prior

written approval of the Participants.

Financial Costs Project costs met with monetary

contributions.

Financial Management A document that describes the estimated

Procedures Document schedule, handling, and auditing of monetary

(FMPD) contributions for the Project in which one

Participant contracts on behalf of the other

Participant or on behalf of both

Participants to fulfill the objectives of

the Project.

Host Participant The Participant whose nation serves as the

location of the JPO.

Information Knowledge that can be communicated by any

means, regardless of form or type,

including, but not limited to, that of a

scientific, technical, business, or

financial nature, and also including

photographs, reports, manuals, threat data,

experimental data, test data, computer

software, designs, specifications,

processes, techniques, inventions, drawings,

technical writings, sound recordings,

pictorial representations, and other

graphical presentations, whether in magnetic

tape, computer memory, or any other form,

and whether or not subject to Intellectual

Property rights.

Initial Operational That date when the first unit or units of a

Capability (IOC) system are fielded, have completed testing,

and are determined to be ready for

deployment and operational field support.

Intellectual

Property

In accordance with the World Trade

Organization Agreement on Trade-related

Aspects of Intellectual Property Rights of

April 15, 1994, all copyright and related

rights, all rights in relation to inventions

(including Patent rights), all rights in

registered and unregistered trademarks

(including service marks), registered and

unregistered designs, undisclosed

8
Information (including trade secrets and

know-how), layout designs of integrated

circuits, and geographical indications, and

any other rights resulting from creative

activity in the industrial, scientific,

literary, and artistic fields.

JPO Joint Project Office

MMA Maritime Multimission Aircraft: This is the

superseded nomenclature for the P-8A

Poseidon aircraft.

Non-financial Costs Project costs met with non-monetary

contributions.

P-8A Poseidon The acquisition strategy and subsequent

Spiral 1 development and testing efforts to provide

Development capability upgrades for the baseline P-8A.

Parent Participant The Participant that sends its CPP to the

JPO or facility located in the nation of the

other Participant.

Participant

Patent

A signatory to this MOU represented by its

military and civilian personnel.

Contractors and Contractor Support Personnel

will not be representatives of a Participant

under this MOU.

Grant by any Government or a regional office

acting for more than one Government of the

right to exclude others from making, using,

importing, selling, or offering to sell an

invention. The term refers to any and all

patents including, but not limited to,

patents of implementation, improvement or

addition, petty patents, utility models,

appearance design patents, registered

designs, and inventor certificates or like

statutory protection, as well as divisions,

reissues, continuations, renewals, and

extensions of any of these.

Project The system development and demonstration of

9
Project Background

Information

Project Equipment

the P - 8A Poseidon Spiral 1 as set out in

Section II (Objectives) and Section III

(Scope of Work).

Information not generated in the performance

of the Project.

Any material, equipment, end item,

subsystem, component, Special Tooling, or

test equipment jointly acquired or provided

for use in the Project.

Project Foreground Information generated in the performance of

Information the Project.

Project Information Any Information provided to, generated in,

or used in the Project.

Project Invention Any invention in any field of technology,

provided it is new, involves an inventive

step, is capable of industrial application,

and is formulated or made (conceived or

"first actually reduced to practice") in the

course of work performed under a Project.

The term "first actually reduced to

practice" means the first demonstration,

sufficient to establish to one skilled in

the art to which the invention pertains, of

the operability of an invention for its

intended purpose and in its intended

environment.

Project Plan A document that provides a description of

the Project, including as necessary the

detailed scope of work, delivery

requirements, and milestones.

PSI Project Security Instruction

Prospective

Contractor

Any entity that seeks to enter into a

Contract to be awarded by a Participant's

Contracting Agency and that, in the case of

a solicitation involving the release of

export-controlled Information, is eligible

to receive such Information.

Special Tooling Jigs, dies, fixtures, molds, patterns,

1 0
tapes, gauges, other equipment and

manufacturing aids, and all components of

these items that are of such a specialized

nature that without substantial modification

or alteration their use is limited to the

development or production of particular

supplies or parts thereof or to the

performance of particular services and

excluding material, special test equipment,

facilities (except foundations and similar

improvements necessary for installing

Special Tooling), general or special machine

tools, or similar capital items.

Spiral 1 The term Spiral 1 has been replaced by P-8A

Poseidon Spiral 1.

System Development The purpose of the SDD phase is to develop a

and Demonstration system or an increment of capability; reduce

(SDD) integration and manufacturing risk; ensure

operational supportability with particular

attention to reducing the logistics

footprint; implement human systems

integration (HSI); design for producibility;

ensure affordability and the protection of

critical program information (CPI) by

implementing appropriate techniques such as

anti-tamper; and demonstrate system

integration, interoperability, safety, and

utility. SDD has two major efforts: System

Integration and System Demonstration.

Third Party A government other than the Government of a

Participant and any person or other entity

whose government is not the Government of a

Participant.

11
SECTION II

OBJECTIVES

2.1 The objectives of this Project are to:

2.1.1 Complete the development and detailed system design

for capability upgrades to the Baseline P-8A

Poseidon airframe, mission system, and related

support systems to meet the U.S. DoD operational,

performance, and interoperability requirements, as

specified in paragraph 2.1. of Annex A (System

Requirements and Australian Operational

Requirements);

2.1.2 Develop and design variations from the Baseline P-8A

Poseidon airframe and mission system to meet

Australian operational requirements as defined in

Annex A (System Requirements and Australian

Operational Requirements) and as agreed to by the P8A Poseidon Spiral 1 Steering Committee (SC) and

funded additionally by ADOD;

2.1.3. Develop and implement management and control

processes to ensure the Participants receive best

value within the Financial Cost Ceiling;

2.1.4. Produce test articles to support Developmental Test

and Evaluation (DT&E) and Operational Test and

Evaluation (OT&E) programs for the Spiral 1

capability upgrades developed per paragraph 2.1.1.

and 2.1.2. of this MOU;

2.1.5. Develop integrated logistics support and training

systems necessary to support DT&E and OT&E of the

Spiral 1 Systems and to enable transition to

production and subsequent fielding of operational

squadrons for the Participants;

2.1.6. Conduct development and operational testing of P-8A

Poseidon Spiral 1 and Australian operational

requirements capabilities as set out in paragraphs

2.1.1. and 2.1.2. of this MOU;

2.1.7. Conduct cooperative studies and discussion of

follow-on efforts, directed toward the cooperative

12
production, support, and incremental development on

the P-8A system, training systems, and supporting

equipment and technologies; and

2.1.8. Promote and encourage greater maritime surveillance

interoperability between the Participants' manned

and unmanned systems, trainers, and associated

support systems.

13
SECTION III

SCOPE OF WORK

3.1. Conduct technical, cost, risk, and logistics analysis of

proposed technologies; evaluate system requirements through

cost/performance trade-off analysis; provide technical and

management support for the development of P-8A Spiral 1

acquisition documentation; and provide engineering and

management of technical development effort.

3.2. Design, develop, fabricate, integrate, demonstrate,

validate, and test hardware and software that provides

capability upgrades to the Baseline P-8A Poseidon to meet U.S.

DoD and ADOD operational requirements and performance

specifications, and ensure the prime Contractor fulfills its

obligations under any Contract related to cooperative efforts by

the Participants, both shared and unique. Candidate capability

upgrades are outlined in Annex A (System Requirements and

Australian Operational Requirements). Such efforts will

exploit, to the maximum extent practicable, concepts and

technology maturation demonstrations and modeling and simulation

and analysis capabilities. This will include, but is not

limited to, the following tasks:

3.2.1. Verify and certify the completeness of the design

and development process, leading to developmental

testing and the operational assessment of the

capability upgrades for the Baseline P-8A

Poseidon aircraft;

3.2.2. Develop and provide test articles, ground

stations, and system integration laboratories to

support integration, developmental test, and

demonstration activities of joint capability

upgrades;

32.3. Participate in development test planning and

testing, and operational test planning as part of

the P-8A Poseidon Spiral 1 integrated test team;

3.2.4. Evaluate and conduct performance analysis for

development and testing of P-8A Poseidon

Australian operational requirements;

14
3.2.5. Develop and implement a program management system

that uses integrated product and process

development, earned value management, technical

performance measures, and risk management

tracking systems as management tools to provide

cost, schedule, and performance Information.

3.2.6. Participate in program reviews.

3.2.7. Participate in P-8A Poseidon program roadmap

discussions, planning efforts, and reviews to

determine future requirements, capabilities, and

development efforts.

3.2.8. Participate in P-8A Poseidon production planning

to consider ADOD requirements in production line

allocations, on the assumption that the ADOD will

participate in the P-8A Poseidon production,

support, and follow-on development MOU.

3.3. The U.S. DoD will make its best efforts to provide the ADOD

sufficient Project Background Information to make an informed

decision to proceed into a cooperative production, sustainment,

and follow-on development arrangement. Such Project Background

Information may include cost, performance, risk, schedule,

sustainment and support concepts, and life cycle ownership costs

and risks Information. Additionally, the U.S. DoD will provide

sufficient insight into the Baseline P-8A Poseidon airworthiness

certification to enable recognition of the U.S. DoD-granted

certifications by the ADOD.

3.4. As reflected in Annex A (System Requirements and Australian

Operational Requirements), the U.S. DoD will make its best

efforts to facilitate ADOD development and testing of the ADOD

integrated ground environment, including the provision of

appropriate Project Background Information relating to P-8A

system interfaces, and if necessary, Contracting on behalf of

ADOD in support of both ADOD and its industry capability

partner, on a not-to-interfere basis with Project goals,

schedules, or Contracting. In the event that U.S. DoD agencies

require funding in order to accomplish tasks in support of ADOD

integrated ground environment/P-8A interface efforts, the FMPD

and Project Plan will set out funding mechanisms and schedules

in order that these tasks can be performed in a timely and

efficient manner.

15
SECTION IV

MANAGEMENT (ORGANIZATION AND RESPONSIBILITY)

4.1. This Project will be directed and administered on behalf

of the Participants by an organization consisting of a Steering

Committee (SC) and a Joint Project Office (JPO) headed by a

Project Manager (PM). Each Participant will provide a Deputy

Project Manager (DPM). The SC will exercise authority over the

PM, in accordance with this MOU. The PM will have primary

responsibility for effective implementation, efficient

management, and direction of the Project in accordance with this

MOU. The DPMs will manage the day-to-day implementation of the

Project in accordance with the Project Plan and this MOU.

4.2. The SC will consist of a representative designated by each

Participant. The SC will meet annually with additional meetings

held at the request of either representative. Each meeting of

the SC will be chaired by the representative of the Participant

hosting the meeting. Decisions of the SC will be made

unanimously. Decisions of the SC will be formally documented

and signed by both SC members. In the event that the SC is

unable to reach a timely decision on an issue, each SC

representative will refer the issue to his higher authority for

resolution. In the meantime the approved Project Plan will

continue to be implemented without interruption under the

direction of the PM while the issue is being resolved by higher

authority.

4.3. The SC will be responsible for:

4.3.1. Exercising executive-level oversight of the

Project.

4.3.2. Reviewing progress in meeting system requirements

as specified in Annex A (System Requirements and

Australian Operational Requirements) of this MOU.

4.3.3. Approving the Project Plan prepared and submitted

by the PM, as assisted by the DPMs, in accordance

with subparagraph 4.6.2. of this Section, and any

revisions thereto, and reviewing the technical

progress of the Project against the Project Plan.

The Project Plan will include, but not be limited

to, the following elements:

16
4.3.3.1. Detailed scope of work and

corresponding work schedule, as

appropriate.

4.3.3.2. References to applicable acquisition

approval processes and documents.

4.3.4. Approving the FMPD and any changes to the FMPD as

developed by the DPMs and proposed by the PM.

4.3.5. Reviewing the financial status of the Project to

ensure compliance with the provisions of Section

V (Financial Provisions) of this MOU and the

FMPD.

4.3.6. Resolving issues brought forth by the PM.

4.3.7. Reviewing and forwarding to the Participants for

approval recommended amendments to this MOU in

accordance with Section XVIII (Amendment,

Termination, Entry into Effect, and Duration) of

this MOU.

4.3.8. Approving amendments to Annexes A, B, and C of

this MOU consistent with Section XVIII

(Amendment, Termination, Entry into Effect, and

Duration) of this MOU.

4.3.9. Employing its best efforts to resolve, in

consultation with the export control authorities

of the Participant concerned, any export control

issues identified by the DPMs and raised by the

PM in accordance with subparagraph 4.6.10. of

this section or raised by a Participant's SC

representative in accordance with subparagraph

9.1.2.4. of Section IX (Disclosure and Use of

Project Information) of this MOU.

4.3.10. Providing recommendations to the Participants for

the addition of new Participants in accordance

with Section XV (Participation of Additional

Nations) of this MOO.

4.3.11. Monitoring Third Party sales and transfers

authorized in accordance with Section XIII (Third

Party Sales and Transfers) of this MOU.

17
4.3.12. Reviewing the annual status report prepared by

the DPMs and submitted by the PM.

4.3.13. Approving plans to manage and control the

transfer of Project Equipment provided by either

Participant to support the execution of the

Project in accordance with Section VIII (Project

Equipment).

4.3.14. Approving plans for the disposal of jointly

acquired Project Equipment under this MOU in

accordance with Section VIII (Project Equipment).

4.3.15. Issuing written decisions regarding sole source

contracting for Australian operational

requirements in accordance with paragraph 6.8. of

this MOU.

4.4. The JPO will be established at Naval Air Systems Command,

Naval Air Station Patuxent River, Maryland to manage the

Project. The Program Executive Officer Air Anti-Submarine,

Assault, and Special Mission programs (PEO(A)), as the U.S. DoD

SC representative, will appoint the U.S. PM. As head of the

JPO, the U.S. PM will be responsible for overseeing the overall

progress of the Project and the efforts of the DPMs, who will

assist the PM with implementing this MOU and providing day-today management of the Project.

4.5. The Participants will each provide national representation

to the JPO by designating a Deputy Project Manager (DPM). As

depicted in Annex B (Joint Project Office Organization) to this

MOU, each DPM will report to the PM heading the JPO.

4.6. The PM will be responsible for:

4.6.1. Managing the cost, schedule, performance

requirements, technical, security, and financial

aspects of the Project described in this MOU in

consultation with the DPMs, including any issues

regarding Australian operational requirements.

4.6.2. Submitting the Project Plan developed by the DPMs

and the responsible Contracting Officer and any

necessary revisions thereto, as described in

subparagraph 4.3.3. of this Section; for SC

approval and, in consultation with the DPMs,

18
implementing the plan and any revisions approved

by the SC.

4.6.3. Executing the financial aspects of the Project in

accordance with Section V (Financial Provisions)

of this MOU and the FMPD.

4.6.4. Referring issues to the SC that cannot be

resolved by the PM.

4.6.5. Developing and recommending amendments to this

MOU and Annexes to the SC.

4.6.6. In conjunction with the DPMs, developing and

implementing SC-approved plans to manage and

control the transfer of Project Equipment

provided by either Participant in accordance with

Section VIII (Project Equipment).

4.6.7. In conjunction with the DPMs, developing and

forwarding to the SC a Project Security

Instruction (PSI) and a Classification Guide for

the Project within three months after MOU

signature, and implementing them upon final

approval.

4.6.8. Forwarding recommendations to the SC for the

addition of new Participants in accordance with

Section XV (Participation of Additional Nations)

of this MOU.

4.6.9. Monitoring export control arrangements required

to implement this MOU and, if applicable,

referring immediately to the SC any export

control issues that could adversely affect the

implementation of this MOU.

4.6.10. Providing an annual status report to the SC.

4.6.11. Exercising configuration management in accordance

with the Project Plan.

4.6.12. Exercising software management in accordance with

the Project Plan.

4.6.13. Appointing a Project security officer.

19
4.6.14. Submitting to the SC for approval an FMPD

prepared by the DPMs.

4.7. A DPM from both Participants will be assigned to the JPO.

The primary responsibility of the DPM is to assist the PM with

the following duties:

4.7.1. Providing recommendations to the PM for Project

direction, schedule, and budget.

4.7.2. Referring issues to the PM that cannot be

resolved within the JPO.

4.7.3. Assisting the PM in developing the Project Plan,

FMPD, PSI, and other related documents.

4.7.4. Reviewing and providing inputs regarding P-8A

Spiral 1 Contract strategies, P-8A Spiral 1

requests for proposals, P-8A Spiral 1 Contracts

and modifications, at the discretion of the

Contracting Officer.

4.7.5. Participating in and providing inputs to Project

strategy and management meetings and Project

reviews.

4.7.6. Assisting the PM in preparing the annual status

report to the SC.

4.7.7. Assisting the PM in developing and implementing

SC-approved plans to manage and control the

transfer of Project Equipment and for the

disposal of jointly acquired Project Equipment.

4.8. The Australian DPM will also be responsible for:

4.8.1. Exercising administrative management of the

Australian CPPs assigned to the Project.

4.8.2. Providing ADOD representation within the JPO on

all matters relating to the Project.

4.8.3. Performing other tasks as may be assigned by the

PM consistent with the position description.

4.8.4. Informing the Australian SC representative of

Project status and progress.

20
SECTION V

FINANCIAL PROVISIONS

5.1. The Participants estimate that the performance of the

responsibilities under this MOU will not cost more than a

Financial Cost Ceiling of $225.672 million Then Year (TY) U.S.

dollars. The U.S. dollar will be the reference currency for the

Project, and the Project fiscal year will be the U.S. fiscal

year. The Financial Cost Ceiling may be changed only upon the

mutual written consent of the Participants. The Participants

will use their best efforts to perform, or to have performed,

the work specified in Section III (Scope of Work) of this MOU

and fulfill all of their responsibilities under this MOU within

the Financial Cost Ceiling. If at any time the PM has reason to

believe that the Financial Cost Ceiling of the Project will be

exceeded, the PM will promptly notify the SC and will set forth

a new estimate of the Financial Cost Ceiling of the Project

together with supporting documentation. The SC will advise the

PM as to what action should be taken.

5.2. Each Participant will contribute its equitable share of

the full Financial Costs and Non-financial Costs of the Project,

including overhead costs, administrative costs, and costs of

claims, and will receive an equitable share of the results of

the Project.

5.3. The full Financial Costs and Non-financial Costs of the

Project will be shared as follows:

U.S. DoD Financial

ADOD Financial

Total Financial

U.S. DoD Non-financial

ADOD Non-financial

Total Non-Financial

$165.672 million TY U.S.

$ 60.000 million TY U.S.

$225.672 million TY U.S.

$296.100 million TY U.S.

$ 23.340 million TY U.S.

$319.440 million TY U.S.

5.4. Participation in the Project will include both financial

and non-financial contributions to support Project efforts.

Values have been mutually determined for Project non-financial

contributions.

21
5.5. Participation in the Project will also include financial

and non-financial contributions for JPO administration and

associated support services including, but not limited to, JPO

costs of travel incurred in support of Project efforts, JPO

training costs, Contract award, Contract administration, office

space, security services, information technology services,

communications services, and supplies.

5.6. In addition to the shared costs of JPO administration and

associated support services costs described in paragraph 5.5. of

this Section, the cost of personnel in the JPO will be borne as

follows:

5.6.1. The Host Participant will bear the costs of all

pay and allowances of Host Participant personnel

in the JPO.

5.6.2. The Parent Participant will bear the following

Cooperative Project Personnel (CPP)-related

costs:

5.6.2.1. All pay and allowances of CPP assigned

to the JPO.

5.6.2.2 Transportation of CPP, CPP dependents,

and their personal property to the JPO

location prior to commencement of the

CPP assignment in the JPO, and return

transportation of the foregoing from

the JPO location upon completion or

termination of the CPP assignment.

5.6.2.3 Compensation for loss of, or damage to,

the personal - property of CPP or CPP

dependents, subject to the laws and

regulations of the Parent Participant's

Government.

5.7. The sum of the Participants' Project financial

contributions equals the Financial Cost Ceiling for the Project

reflected in this Section of the MOU.

5.8. The following costs will be borne entirely by the

Participant incurring the costs or on whose behalf the costs are

incurred:

5.8.1. Costs associated with national representation at

meetings by non -JPO members.

22
5.8.2. Costs associated with any unique national

requirements identified by a Participant.

5.8.3. Any other costs not expressly stated as shared

costs or any costs that are outside the scope of

this MOU.

5.9. If the U.S. DoD decides subsequently that it wishes to use

Project Information generated in performance of an Australian

operational requirement, or to acquire any item that results

from an Australian operational requirement, the U.S. DoD will

make equitable arrangements with the ADOD (as determined by the

SC) for the U.S. DoD share of the costs of those efforts in

accordance with paragraph 5.2. of this Section.

5.10. The PM, as assisted by the DPMs, will be responsible for

establishing the detailed financial management procedures under

which the Project will operate. These procedures, which must be

in accord with the national accounting and audit requirements of

the Participants, will be detailed in the FMPD prepared by the

DPMs and submitted by the PM for approval by the SC. Each

Participant will fund the Project in accordance with the

estimated schedule of financial contributions contained in the

FMPD, which will be consistent with paragraph 5.11. of this

Section.

5.11. A Participant will promptly notify the other Participant

if available funds are not adequate to fulfill its

responsibilities under this MOU. If a Participant notifies the

other Participant that it is terminating or reducing its funding

for this Project, both Participants will immediately consult,

with a view toward continuation on a modified basis.

5.12. The Participants recognize that it may become necessary

for one Participant to incur contractual or other

responsibilities for the benefit of the other Participant, or

both of the Participants prior to receipt of the other

Participant's funds. In such event, the other Participant will

make such funds available in such amounts and at such times as

required by the Contract or other responsibility and will pay

any damages and costs that may accrue from the performance or

cancellation of the Contract or other responsibility in advance

of the time such payments, damages, or costs are due.

5.13. Each Participant will, consistent with its national laws,

regulations, and policies, provide to the other Participant the

23
Information and assistance described in paragraphs 5.14. and

5.15. of this Section.

5.14. The U.S. DoD will be responsible for the audit of the

procurement activities for which it is responsible under the

Project in accordance with its national practices. The U.S. DoD

will use its best efforts to perform any audits requested by the

ADOD and agreed to by the U.S. DoD.

5.15. The U.S. DoD will be responsible for the internal audit

regarding administration of the other Participant's Project

funds in accordance with U.S. national practices. The U.S. DoD

will promptly make audit reports of such funds available to the

other Participant. Upon the mutual consent of the U.S. DoD and

the ADOD, auditors will be permitted to assist the U.S. DoD on

any audit elements required to satisfactorily perform the audit.

In addition, if ADOD or its auditors need to obtain or to

inspect specific Project Information in order to fulfill its

national obligations, the U.S. DoD will arrange for access to

such specific Information at mutually determined times and

locations.

5.16. On any future sale by the U.S. DoD to the ADOD of the P-8A

Poseidon Spiral 1, the U.S. DoD will exclude from the price of

the P-8A Poseidon specific U.S. DoD research and development

costs incurred for P-8A Poseidon Spiral 1 efforts, provided that

the ADOD does not terminate their participation in this MOU.

24
SECTION VI

CONTRACTING PROVISIONS

6.1. The U.S. DoD (acting through the Department of the Navy)

will be primarily responsible for Contracting for this Project

in accordance with U.S. laws, regulations, and procedures. The

ADOD may perform Contracting for its unique national

requirements, or may, upon request, Contract to meet Project

requirements. In the event that the ADOD contracts for either

its own unique national requirements, or Project requirements,

such Contracting will be in accordance with Australian laws,

regulations, and procedures. The Contracting Officer is the

exclusive source for providing contractual direction and

instructions to Contractors.

6.2. The PM and DPMs will cooperate, as requested, with the

Contracting Officers in the areas of Contract procedures,

Contract negotiation, evaluation of offers, Contract award, and

Contract modifications. The PM and DPMs will review statements

of work prior to the development of solicitations to ensure that

they are in accordance with this MOU. The Contracting Officer

will keep the PM and DPMs advised of all significant

developments associated with award and performance of Contracts,

and will keep the PM and DPMs advised of all financial

arrangements with Contractors.

6.3. The Contracting Officer will use best efforts to obtain

the rights to use and disclose Project Information required by

Section IX (Disclosure and Use of Project Information) of this

MOU. The Contracting Officer will insert into prospective

Contracts (and require it's Contractors to insert in

subcontracts) suitable provisions to satisfy the requirements of

this MOU, including Section IX (Disclosure and Use of Project

Information), Section X (Controlled Unclassified Information),

Section XII (Security), Section XIII (Third Party Sales and

Transfers), and Section XVIII (Amendment, Termination, Entry

into Effect, and Duration) of this MOU, including the export

control provisions in accordance with this MOU, in particular

paragraphs 6.4. and 6.5. of this Section. During the

Contracting process, the Contracting Officer will advise

Prospective Contractors of their responsibility to notify

immediately the Contracting Agency, before Contract award, if

they are subject to any license or agreement that will restrict

their freedom to disclose Information or permit its use. The

Contracting Officer will also advise Prospective Contractors to

25
employ their best efforts not to enter into any new agreement or

arrangement that will result in restrictions.

6.4. Each Participant will legally bind its Contractors to a

requirement that the Contractor will not retransfer or otherwise

use export-controlled Information furnished by the other

Participant for any purpose other than the purposes authorized

under this MOU. The Contractor will also be legally bound not

to retransfer the export-controlled Information to another

Contractor or subcontractor unless that Contractor or

subcontractor has been legally bound to limit use of the

Information to the purposes authorized under this MOU. Exportcontrolled Information furnished by one Participant under this

MOU may only be retransferred by the other Participant to its

Contractors if the legal arrangements required by this paragraph

have been established.

6.5. Each Participant will legally bind its Prospective

Contractors to a requirement that the Prospective Contractor

will not retransfer or otherwise use export-controlled

Information furnished by the other Participant for any purpose

other than responding to a solicitation issued in furtherance of

the purposes authorized under this MOU. Prospective Contractors

will not be authorized use for any other purpose if they are not

awarded a Contract. The Prospective Contractors will also be

legally bound not to retransfer the export-controlled

Information to a prospective subcontractor unless that

prospective subcontractor has been legally bound to limit use of

the export-controlled Information for the purpose of responding

to the solicitation. Export-controlled Information furnished by

one Participant under this MOU may only be retransferred by the

other Participant to its Prospective Contractors if the legal

arrangements required by this paragraph have been established.

Upon request by the furnishing Participant, the receiving

Participant will identify its Prospective Contractors and

prospective subcontractors receiving such export-controlled

Information.

6.6. In the event the Contracting Officer is unable to secure

adequate rights to use and disclose Project Information as

required by Section IX (Disclosure and Use of Project

Information) of this MOU, or is notified by Contractors or

Prospective Contractors of any restrictions on the disclosure

and use of Information, the matter will be referred to the SC

for resolution.

26
6.7. The Contracting Officer will immediately advise the PM of

any cost growth, schedule change, or performance problems of any

Contractor for which the Contracting Officer is responsible.

The Contracting Officer will act in the best interest of both

Participants in Contract administration decisions.

6.8. Upon mutual consent, consistent with Section II

(Objectives) of this MOU, a Participant may contract for the

unique national requirements of the other Participant. The

U.S. DoD will provide the ADOD with insight into subcontracting

related to Australian operational requirements via IPT

participation, attendance at Program Management Reviews, and DPM

participation in the Contract administration process. At the

request of the ADOD and as reflected in a written SC decision,

in relation to a Contract or subcontract for ADOD operational

requirements, the Contracting Officer may place the Contract or

require the Contractor to place the subcontract with a supplier

specified by ADOD.

6.9. When Contracting on behalf of the other Participant for

national operational requirements, the Contracting Participant

will investigate in a timely manner concerns that a Contractor

is not meeting contractual requirements. The DPMs will work

with the Contracting Officer and the PM to determine an

appropriate course of action if a Contractor is not meeting

contractual requirements.

6.10. The personnel of a Participant whose national operational

requirements are included in a Contract may participate in the

Contract administration (including acceptance procedures) of

that Contract to the extent authorized in writing by the

Contracting Officer regarding those national operational

requirements.

6.11. A Participant whose national operational requirements are

included in a Contract may request cost and pricing data in

relation to those national operational requirements in that

Contract. Unless it is subject to the Intellectual Property

rights of a Contractor or subcontractor, the Participant will be

provided such cost and pricing data, at the discretion of the

Contracting Officer. If requested, the Contracting Officer will

use best efforts to obtain the written consent of the Contractor

or subcontractor to provide such data to the Participant in

relation to those national operational requirements. The

Participants understand that such data cannot be provided if the

Contractor or subcontractor does not provide written consent.

27
6.12. The DPMs may provide written recommendations to the award

fee board, in accordance with the applicable Contracting

Agency's process and procedures regarding the level of

Contractor achievement related to their articles and services

that have been placed on Contract. At the discretion of the

Contracting Officer, the DPM of a Participant may be a member of

an award fee board when the award fee under discussion relates

to the national operational requirements of that Participant.

28
SECTION VII

INDUSTRIAL PARTICIPATION

7.1. Sources from both nations will be permitted to bid on

Project work that is not being performed by the prime

Contractor. Additionally, each Participant will encourage its

Contractors to provide competitive opportunities to sources from

the other nation to participate in the work of the Project,

provided that such participation does not affect the Project

adversely, and is consistent with high technical merit,

reasonable cost, and the need to achieve the timely, economical,

and efficient execution of the Project. The U.S. DoD will make

its best efforts to facilitate timely export control

authorizations to allow Australian industry to compete for

opportunities in the Project.

7.2. No requirement will be imposed by either Participant for

work sharing or other industrial or commercial compensation in

connection with this MOU that is not in accordance with this

MOU.

7.3. The Participants will encourage timely notification of

Contracting and subcontracting opportunities for the Project.

7.4. The Participants acknowledge that, subject to the

Contracting Participant's laws and regulations and to the

submission of best value offers, industries that are in the

Participants' nations and that were awarded subcontracts in

support of the Project will be better positioned for and thus

normally be awarded subcontracts for follow-on production,

support, and future development efforts.

29
SECTION VIII

PROJECT EQUIPMENT

8.1. Each Participant may provide Project Equipment identified

as being necessary for executing the MOU to the other

Participant. Project Equipment will remain the property of the

providing Participant. A list of all Project Equipment provided

by one Participant to the other Participant will be developed

and maintained by the PM with the assistance of the DPMs,

submitted by the PM to the SC for approval, and incorporated

into Annex C (Inventory of Project Equipment Exchanges) in

accordance with Section IV (Management (Organization and

Responsibility)) of this MOU prior to such transfers.

8.2. The receiving Participant will maintain any such Project

Equipment in good order, repair, and operable condition. Unless

the providing Participant has authorized the Project Equipment

to be expended or otherwise consumed without reimbursement to

the providing Participant, the receiving Participant will return

the Project Equipment to the providing Participant in as good

condition as received, normal wear and tear excepted, or return

the Project Equipment and pay the cost to restore it. If the

Project Equipment is damaged beyond economical repair, the

receiving Participant will return the Project Equipment to the

providing Participant (unless otherwise specified in writing by

the providing Participant) and pay the replacement value

specified in Annex C (Inventory of Project Equipment Exchanges),

which will be computed pursuant to the providing Participant's

national laws and regulations. If the Project Equipment is lost

while in the custody of the receiving Participant, the receiving

Participant will issue a certificate of loss to the providing

Participant and pay the replacement value specified in Annex C

(Inventory of Project Equipment Exchanges) to this MOU.

8.3. The providing Participant will deliver Project Equipment

to the receiving Participant at a mutually determined location.

Possession of the Project Equipment will pass from the providing

Participant to the receiving Participant at the time of receipt

of the Project Equipment. Any further transportation is the

responsibility of the receiving Participant.

8.4. All Project Equipment that is transferred will be used by

the receiving Participant only for the purposes of carrying out

this MOU, unless otherwise consented to in writing by the

providing Participant. In addition, in accordance with Section

30
XIII (Third Party Sales and Transfers) of this MOU, Project

Equipment will not be re-transferred or sold to a Third Party

without the prior written consent of the providing Participant.

8.5. Project Equipment transferred to one Participant under

this MOU will be returned to the providing Participant prior to

the termination or expiration of this MOU.

8.6. Any Project Equipment that is jointly acquired on behalf

of both Participants for use under this MOU will be disposed of

during this Project or when the Project ceases, as determined by

the SC.

8.7. Disposal of jointly acquired equipment may include a

transfer of the interest of one Participant in such Project

Equipment to the other Participant, or the sale of such Project

Equipment to a Third Party in accordance with Section XIII

(Third Party Sales and Transfers) of this MOU. The Participants

will share the consideration from jointly acquired Project

Equipment transferred or sold to a Third Party in the same ratio

as costs are shared under this MOU.

8.8. Liability for loss of or damage to a P-8A aircraft used in

development or test of shared requirements in the Project will

be shared in accordance with the ratio of the Participants'

shared Financial and Non-financial Costs.

31
SECTION IX

DISCLOSURE AND USE OF PROJECT INFORMATION

9.1. General

9.1.1. Both Participants recognize that successful

collaboration depends on full and prompt exchange

of Information necessary for carrying out this

Project. The Participants intend to acquire

sufficient Project Information and rights to use

such Information to enable the successful

accomplishment of the Project as defined in

Section III (Scope of Work). The nature and

amount of Project Information to be acquired will

be consistent with the objectives stated in

Section II (Objectives) and Section III (Scope of

Work) of this MOU.

9.1.2. The following export control provisions will

apply to the transfer of Project Information:

9.1.2.1.

9.1.2.2.

9.1.2.3.

Transfer of Project Information will be

consistent with the furnishing

Participant's applicable export control

laws and regulations.

Unless otherwise restricted by duly

authorized officials of the furnishing

Participant at the time of transfer to

the other Participant, all exportcontrolled Information furnished by one

Participant to the other Participant

may be retransferred to the other

Participant's Contractors,

subcontractors, Prospective

Contractors, and prospective

subcontractors, subject to the

requirements of paragraphs 6.4. and

6.5. of Section VI (Contracting

Provisions) of this MOU.

Export-controlled Information may be

furnished by Contractors,

subcontractors, Prospective

Contractors, and prospective

32
9.1.2.4.

subcontractors of one Participant's

nation to the Contractors,

subcontractors, Prospective

Contractors, and prospective

subcontractors of the other

Participant's nation pursuant to this

MOU, subject to the conditions

established in licenses or other

approvals issued by the Government of

the former Participant in accordance

with its applicable export control laws

and regulations.

If a Participant finds it necessary to

exercise a restriction on the

retransfer of export-controlled

Information as set out in subparagraph

9.1.2.2. of this Section, it will

promptly inform the other Participant's

representative. If a restriction is

then exercised and the affected

Participant objects, that Participant's

SC representative will promptly notify

the other Participant's SC

representative and they will

immediately consult in order to discuss

ways to resolve such issues or mitigate

any adverse effects.

9.1.3. Notwithstanding any other provision in this

Section, disclosure of Project Information will

be in accordance with the Participants'

respective national disclosure policies. The

Participants will use their best efforts to

maximize disclosure of Project Information under

this MOU within national disclosure policies and

in accordance with the applicable security

bilateral agreements and arrangements.

9.2. Government Project Foreground Information

9.2.1. Disclosure: All Project Foreground Information

generated by a Participant's military or civilian

employees (hereinafter referred to as "Government

Project Foreground Information") will be

disclosed promptly and without charge to the

other Participant.

33
9.2.2. Use: Each Participant may use all Government

Project Foreground Information without charge for

Defense Purposes. The Participant generating

Government Project Foreground Information will

also retain its rights of use thereto. Any sale

or other transfer to a Third Party will be

subject to the provisions of Section XIII (Third

Party Sales and Transfers) of this MOU.

9.3. Government Project Background Information

9.3.1. Disclosure: Each Participant, upon request, will

disclose to the other Participant any relevant

Government Project Background Information

generated by its military or civilian employees,

provided that:

9.3.1.1. Such Government Project Background

Information is necessary to the

Project, with the Participant in

possession of the Information

determining whether it is "necessary

to" the Project.

9.3.1.2. Such Government Project Background

Information may be made available only

if the rights of holders of

Intellectual Property rights are not

infringed.

9.3.1.3. Disclosure of such Government Project

Background Information is consistent

with national disclosure policies and

regulations of the furnishing

Participant.

9.3.1.4. Any disclosure or transfer of such

Government Project Background

Information to Contractors is

consistent with the furnishing

Participant's export control laws and

regulations.

9.3.2. Use: Government Project Background Information

furnished by one Participant to the requesting

Participant may be used without charge by or for

34
the requesting Participant for Project purposes.

However, subject to Intellectual Property rights

held by entities other than the Participants,

such Government Project Background Information

may be used for Defense Purposes by the

requesting Participant, without charge, when such

Information is necessary for the use of Project

Foreground Information. The furnishing

Participant, in consultation with the other

Participant, will determine whether the

Government Project Background Information is

necessary for the use of Project Foreground

Information. The furnishing Participant will

retain all its rights with respect to such

Government Project Background Information.

9.4. Contractor Project Foreground Information

9.4.1. Disclosure: Project Foreground Information

generated and delivered by Contractors

(hereinafter referred to as "Contractor

Foreground Information") will be disclosed

without charge to both Participants.

9.4.2. Use: Each Participant may use or have used

without charge for Defense Purposes all

Contractor Project Foreground Information

generated and delivered by Contractors of the

Participants. The Participant whose Contractors

generate and deliver Contractor Project

Foreground Information will also retain all its

rights of use thereto in accordance with the

applicable Contracts. Any sale or other transfer

to a Third Party of Contractor Project Foreground

Information will be subject to the provisions of

Section XIII (Third Party Sales and Transfers) of

this MOU.

9.5. Contractor Project Background Information

9.5.1. Disclosure: A Contracting Participant will make

available to the other Participant promptly and

without charge all Contractor Project Background

Information generated by Contractors that is

delivered under Contracts awarded in accordance

with this MOU. Any other Project Background

Information that is generated by Contractors and

35
that is in the possession of one Participant will

be made available promptly and without charge to

the other Participant, upon its request, provided

the following conditions are met:

9.5.1.1. Such Contractor Project Background

Information is necessary to the

Project, with the Participant in

possession of the Information

determining, after consultation with

the requesting Participant, whether it

is "necessary to" the Project.

9.5.1.2. Such Contractor Project Background

Information may be made available only

if the rights of holders of

Intellectual Property rights are not

infringed.

9.5.1.3. Disclosure of such Contractor Project

Background Information is consistent

with national disclosure policies and

regulations of the furnishing

Participant.

9.5.1.4. Any disclosure or transfer of such

Contractor Project Background

Information to Contractors is

consistent with the furnishing

Participant's export control laws and

regulations.

9.5.2. Use: Any Contractor Project Background

Information furnished by one Participant's

Contractors and disclosed to a requesting

Participant may be used without charge by the

requesting Participant for Project purposes,

subject to any restrictions by holders of

Intellectual Property rights other than the

Participants; also, when necessary for the use of

Project Foreground Information, such other

Contractor Project Background Information may be

used by the requesting Participant for Defense

Purposes, subject to such fair and reasonable

terms as may be necessary to be arranged with the

Contractor. The furnishing Participant, in

consultation with the requesting Participant,

36
will determine whether such other Contractor

Project Background Information is necessary for

the use of Project Foreground Information. The

furnishing Participant will retain all its rights

with respect to Contractor Project Background

Information.

9.6. Notwithstanding paragraphs 9.2., 9.4., and 9.5. of this

Section, if an effort under this MOU is for the national

operational requirements of the ADOD, and in order to carry out

effective Project management, the U.S. DoD will receive, and may

use or have used, for Project purposes, all Project Foreground

Information generated under this MOU for the national

operational requirements of the ADOD. The U.S. DoD will also

receive all Contractor Project Background Information delivered

under Contracts awarded for the national operational

requirements of the ADOD, and may use or have used that

Information for Project purposes, subject to any restrictions by

holders of Intellectual Property rights.

9.7. Alternative Uses of Project Information

9.7.1. Any Project Background Information provided by

one Participant will be used by the other

Participant only for the purposes set forth in

this MOU, unless otherwise consented to in

writing by the providing Participant.

9.7.2. The prior written consent of the U.S. DoD will be

required for the use of Project Foreground

Information by the ADOD for purposes other than

those set out in this MOU.

9.8. Proprietary Project Information

9.8.1. All Project Information that is subject to

disclosure and use restrictions with respect to

Intellectual Property rights will be identified

and marked, and it will be handled as Controlled

Unclassified Information or as Classified

Information, depending on its security

classification.

9.8.2. The PSI will contain provisions regarding

communication of Project Information when such

Project Information is subject to Intellectual

Property rights.

37
9.9. Patents

9.9.1. Each Participant will include in all its

Contracts for the Project a provision governing

the disposition of rights in regard to Project

Inventions and Patent rights relating thereto

that either:

9.9.1.1. Provides that the Participant will hold

title to all such Project Inventions

together with the right to make Patent

applications for the same, free of

encumbrance from the Contractor

concerned; or

9.9.1.2. Provides that the Contractor will hold

title (or may elect to retain title)

for such Project Inventions together

with the right to make Patent

applications for the same, while

securing for the Participants a license

for the Project Inventions, and any

Patents thereto, on terms in compliance

with the provisions of subparagraph

9.9.2. of this Section.

9.9.2. In the event that a Contractor owns title (or

elects to retain title) to any Project Invention,

the Contracting Participant will secure for the

other Participant non-exclusive, irrevocable,

royalty-free licenses under all Patents secured

for that invention, to practice or have practiced

the patented Project Invention throughout the

world for Defense Purposes.

9.9.3. The provisions of subparagraphs 9.9.4. through

9.9.7. below will apply in regard to Patent

rights for all Project Inventions made by the

Participants' military or civilian employees,

including those within Government-owned

facilities, and for all Project Inventions made

by Contractors for which the Contracting

Participant holds title or is entitled to acquire

title.

38
9.9.4. When a Participant has or can secure the right to

file a Patent application with regard to a

Project Invention, that Participant will consult

with the other Participant regarding the filing

of such Patent application. The Participant that

has or receives title to such Project Invention

will, in other countries, file, cause to be

filed, or provide the other Participant with the

opportunity to file on behalf of the Participant

holding title, Patent applications covering that

Project Invention. A Participant will

immediately notify other Participant that a

Patent application has been filed. If a

Participant, having filed or caused to be filed a

Patent application, abandons prosecution of the

application or ceases maintaining the Patent

granted or issued on the application, that

Participant will notify the other Participant of

that decision and permit the other Participant to

continue the prosecution or maintain the Patent

as the case may be.

9.9.5. Each, Participant will be furnished with copies of

Patent applications filed and Patents granted

with regard to Project Inventions.

9.9.6. Each Participant will grant to the other

Participant a non-exclusive, irrevocable,

royalty-free license under its Patents for

Project Inventions, to practice or have praCticed

the Project Invention throughout the world for

Defense Purposes.

9.9.7. Patent applications to be filed under this MOU

which contain Classified Information will be

protected and safeguarded in accordance with the

requirements contained in the Agreement between

the United States and Australia regarding

Interchange of Patent Rights and Technical

Information for Defense Purposes: Filing of

Classified Patent Applications, dated October 2,

1961.

9.10. Each Participant will notify the other Participant of

any Intellectual Property infringement claims brought against

that Participant arising in the course of work performed

under the Project on behalf of the other Participant.

39
Insofar as possible, the other applicable Participant will

provide Information available to it that may assist in

defending such claims. Each Participant will be responsible

for handling such Intellectual Property infringement claims

brought against it, and will consult with the other

Participant during the handling, and prior to any settlement,

of such claims. The Participants will share the costs of

resolving such Intellectual Property infringement claims in

proportion to their financial and non-financial contributions

for that work specified in Section V (Financial Provisions)

of this MOU.

9.11. The Participants will, as permitted by their national

laws, regulations, and practices, give their authorization

and consent for all use and manufacture in the course of work

performed under the Project of any invention covered by

Patent, or as determined to be necessary for work under the

Project, authorization and consent for non-commercial

copyright, granted or otherwise provided by their respective

countries.

40
SECTION X

CONTROLLED UNCLASSIFIED INFORMATION

10.1. Except as otherwise provided in this MOU or as authorized

in writing by the originating Participant, Controlled

Unclassified Information provided or generated pursuant to this

MOU will be controlled as follows:

10.1.1. Such Information will be used only for the

purposes authorized for use of Project

Information as specified in Section IX

(Disclosure and Use of Project Information) of

this MOU.

10.1.2. Access to such Information will be limited to

personnel whose access is necessary for the

permitted use under subparagraph 10.1.1., and

will be subject to the provisions of Section XIII

(Third Party Sales and Transfers) of this MOU.

10.1.3. Each Participant will take all appropriate lawful

steps available to it, including national

classification, to keep such Information free

from further disclosure (including requests under

any legislative provisions), except as provided

in subparagraph 10.1.2. of this Section, unless

the originating Participant consents to such

disclosure. In the event of unauthorized

disclosure, or if it becomes probable that the

Information may have to be further disclosed

under any legislative provision, immediate

notification will be given to the originating

Participant.

10.2. To assist in providing the appropriate controls, the

originating Participant will ensure that Controlled Unclassified

Information is appropriately marked to ensure its "in

confidence" nature. The Participants' export-controlled

Information will be marked in accordance with the applicable

Participant's export control markings as documented in the PSI.

The Participants will also decide, in advance and in writing, on

the markings to be placed on any other types of Controlled

Unclassified Information and describe such markings in the PSI.

41
10.3. Controlled Unclassified Information provided or generated

pursuant to this MOU will be handled in a manner that ensures

control as provided for in paragraph 10.1. of this Section.

10.4. Prior to authorizing the release of Controlled

Unclassified Information to Contractors, the Participants will

ensure the Contractors are legally bound to control such

Information in accordance with the provisions of this Section.

42
SECTION XI

VISITS TO ESTABLISHMENTS

11.1. Each Participant will permit visits to its Government

establishments, agencies and laboratories, and Contractor

industrial facilities by employees of the other Participant or

by employees of the other Participant's Contractors, provided

that the visit is authorized by both Participants and the

employees have any necessary and appropriate security clearances

and a need-to-know.

11.2. All visiting personnel will be required to comply with

security regulations of the hosting Participant. Any

Information disclosed or made available to visitors will be

treated as if supplied to the Participant sponsoring the

visiting personnel, and will be subject to the provisions of

this MOU.

11.3. Requests for visits by personnel of one Participant to a

facility of the other Participant will be coordinated through

official channels, and will conform to the established visit

procedures of the hosting Participant. Requests for visits will

bear the name of the Project.

11.4. Lists of personnel of each Participant required to visit,

on a continuing basis, facilities of the other Participant will

be submitted through official channels in accordance with

recurring international visit procedures.

43
SECTION XII

SECURITY

12.1. All Classified Information provided or generated pursuant

to this MOU will be stored, handled, transmitted, and

safeguarded in accordance with the Agreement concerning Security

Measures for the Protection of Classified Information, between

Australia and the United States, which entered into force on

November 7, 2002. The ADOD DSA is the Head, Defence Security

Authority.

12.2. Classified Information will be transferred only through

official Government-to-Government channels or through channels

approved by the Designated Security Authorities (DSAs) of the

Participants. Such Classified Information will bear the level

of classification and denote the country of origin, the

provisions of release, and the fact that the Information relates

to this MOU.

12.3. Each Participant will take all appropriate lawful steps

available to it to ensure that Classified Information provided

or generated pursuant to this MOU is protected from further

disclosure, except as permitted by paragraph 12.8. of this

Section, unless the other Participant consents to such

disclosure. Accordingly, each Participant will ensure that the

recipient:

12.3.1. Will not release the Classified Information to

any government, national, organization, or

other entity of a Third Party without the prior

written consent of the originating Participant

in accordance with the procedures detailed in

Section XIII (Third Party Sales and Transfers)

of this MOU.

12.3.2. Will not use the Classified Information for

other than the purposes provided for in this

MOU.

12.3.3. Will comply with any distribution and access

restrictions on Classified Information that is

provided under this MOU.

12.4. The Participants will investigate all cases in which it

is known or where there are grounds for suspecting that

44
Classified Information provided or generated pursuant to this

MOU has been lost or disclosed to unauthorized persons. Each

Participant also will promptly and fully inform the other

Participant of the details of any such occurrence, and of the

final results of the investigation and of the corrective action

taken to preclude recurrence.

12.5. The PM will prepare a PSI and a Classification Guide (CG)

for the Project. The PSI and the CG will describe the methods

by which Project Information will be classified, marked, used,

transmitted, and safeguarded, and will require that markings for

all export-controlled Classified Information will include the

applicable export control markings identified in the PSI in

accordance with paragraph 10.2. of Section X (Controlled

Unclassified Information) of this MOU. The PSI and CG will be

developed by the PM within three months after this MOU enters

into effect. The PSI and CG will be reviewed and forwarded to

the Participants' DSAs for approval and will be applicable to

all.Government and Contractor personnel participating in the

Project. The CG will be subject to regular review and revision

with the aim of downgrading the classification whenever this is

appropriate. The PSI and the CG will be approved by the

appropriate DSA prior to the transfer of any Classified

Information or Controlled Unclassified Information.

12.6. The DSA or their designees of the Participant that awards

a classified Contract will assume responsibility for

administering security measures within its territory for the

protection of the Classified Information, in accordance with its

laws and regulations. Prior to the release to a Contractor,

Prospective Contractor, or subcontractor of any Classified

Information received under this MOU, the DSAs will:

12.6.1. Ensure that such Contractor, Prospective

Contractor or subcontractor (and their

facilities) have the capability to protect the

Classified Information adequately.

12.6.2. Grant a security clearance to the facilities,

if appropriate.

12.6.3. Grant a security clearance for all personnel

with duties that require access to Classified

Information, if appropriate.

12.6.4. Ensure that all persons having access to the

Classified Information are informed of their

45
responsibilities to protect the Classified

Information in accordance with national

security laws and regulations and the

provisions of this MOU.

12.6.5. Carry out periodic security inspections of

cleared facilities to ensure that the

Classified Information is properly protected.

12.6.6. Ensure that access to the Classified

Information is limited to those persons who

have a need-to-know for purposes of the MOU.

12.7. Contractors, Prospective Contractors, or subcontractors

that are determined by DSAs to be under financial,

administrative, policy, or management control of nationals or

entities of a Third Party, may participate in a Contract or

subcontract requiring access to Classified Information provided

or generated pursuant to this MOU only when enforceable measures

are in effect to ensure that nationals or other entities of a

Third Party will not have access to Classified Information. If

enforceable measures are not in effect to preclude access by

nationals or other entities of a Third Party, the other

Participant will be consulted for approval prior to permitting

such access.

12.8. For any facility in which Classified Information is to be

used, the responsible Participant or Contractor will approve the

appointment of a person or persons to exercise effectively the

responsibilities for safeguarding at such facility the

Information pertaining to this MOU. These officials will be

responsible for limiting access to Classified Information

involved in this MOU to those persons who have been properly

approved for access and have a need-to-know.

12.9. Each Participant will ensure that access to the

Classified Information is limited to those persons who possess

requisite security clearances and have a specific need for

access to the Classified Information in order to participate in

the Project.

12.10. Information provided or generated pursuant to this MOU

may be classified as high as Secret. The existence of this MOU

is Unclassified and the contents are Unclassified.

46
SECTION XIII

THIRD PARTY SALES AND TRANSFERS

13.1. Subject to paragraph 13.3. of this Section, the U.S. DoD

will retain the right to sell, transfer title to, disclose, or

transfer possession of Foreground Information, jointly acquired

Project Equipment, or any item produced either wholly or in part

from Foreground Information to Third Parties. The U.S. DoD will

not sell, transfer title to, disclose, or transfer possession of

Project Foreground Information, jointly acquired Project

Equipment, or any item produced either wholly or in part from

Project Foreground Information to Third Parties without prior

consultation with the other Participant through the SC.

Furthermore, the U.S. DoD will not permit any such sale,

disclosure, or transfer by others, including by the owner of the

item, without prior consultation with the other Participant.

The U.S. DoD recognizes that sales, disclosures, or other

transfers described in this paragraph will only be made if the

government of the intended recipient consents in writing that it

will:

13.1.1. Not retransfer, or permit the further

retransfer of, any equipment or information

provided; and

13.1.2. Use, or permit the use of, the equipment or

information provided only for the purposes for

which such equipment or information is

furnished.

13.2. The ADOD will not sell, transfer title to, disclose, or

transfer possession of Project Foreground Information, jointly

acquired Project Equipment, or any item produced either wholly

or in part from Project Foreground Information to any Third

Party without the prior written consent of the U.S Government.

Furthermore, the ADOD will not permit any such sale, disclosure,

or transfer by others, including the owner of the item, without

the prior written consent of the U.S Government. The ADOD

recognizes that such sales, disclosures, or other transfers will

not be authorized by the U.S. Government unless the government

of the intended recipient confirms in writing with the U.S. DoD

that it will:

13.2.1. Not retransfer, or permit the further retransfer

of, any equipment or Information provided.

47
13.2.2. Use, or permit the use of, the equipment or

Information provided only for the purposes for

which such equipment or Information is

furnished.

13.3. In the case of Project Foreground Information that is

funded wholly by ADOD for its national operational requirements,

or any item that is produced from such Project Foreground

Information, the U.S. DoD will not sell, transfer title to,

disclose, or transfer possession of such Project Foreground

Information or any item produced from such Project Foreground

Information to any Third Party without the prior written consent

of the ADOD. Furthermore, the U.S. DoD will not permit any such

sale, disclosure, or transfer, including by the owner of the

item, without the prior written consent of the ADOD. The U.S.

DoD recognizes that sales, disclosures, or other transfers

described in this paragraph will be made only if the Government

of the intended recipient consents in writing that it will:

13.3.1. Not retransfer or permit the further retransfer

of any equipment or Information provided; and

13.3.2. Use, or permit the use of the equipment or

Information provided only for the purposes for

which such equipment or Information is

furnished.

13.4. A Participant will not sell, transfer title to, disclose,

or transfer possession of Project Background Information or

Project Equipment provided by the other Participant to any Third

Party without the prior written consent of the Government of the

Participant that provided such equipment or Information. The

providing Participant's Government will be solely responsible

for authorizing such transfers and, as applicable, specifying

the method and provisions for implementing such transfers.

13.5. Consent to Third Party sales and transfers of Project

Foreground Information, jointly acquired Project Equipment, or

any item produced either wholly or in part from Project

Foreground Information will be subject to foreign policy

considerations, national security considerations, and national

laws, regulations, and policies. A Participant Government's

approval of the other Participant' Government's proposed sale or

transfer to a Third Party will take into account its willingness

to sell or transfer such equipment or Information to the same

Third Party.

48
13.6. Sales and other transfers by a Participant or a Contractor

to Third Parties of equipment developed in this Project may

attract a levy to be shared between the U.S. DoD and the ADOD in

accordance with their contributions to funding the development

of that equipment in accordance with the following provisions

and the procedures contained in the FMPD:

13.6.1. Prior to any such sale or other transfer, the

amount of any levy and procedures for assessing

and distributing such levy will be mutually

determined by the Participants consistent with

the laws and regulations of each Participant,

using a pro rata recovery method to be specified

in the FMPD and as described in paragraph 13.6.2.

of this Section.

13.6.2 The PM, in consultation with U.S. DoD

authorities, will determine the total qualifying

non-recurring costs for research and development

and production of the equipment proposed for sale

or transfer. The research, development, and

production non-recurring costs of such equipment

must exceed $50 million U.S. to qualify for levy

collection by one Participant or its Contractors

for the other Participant. Qualifying nonrecurring costs for levy collection will be

determined in accordance with U.S. laws and U.S.

DoD regulations concerning recoupment of nonrecurring costs. Once qualifying non-recurring

costs have been determined for the equipment

proposed for sale or transfer, the PM will divide

those total costs by the total projected

production of that equipment, based on the

projected procurement quantities of the

Participants and Third Parties. Upon SC

approval, the resulting figure will constitute

the levy that may be assessed for the equipment

proposed for sale or transfer. Each

Participant's share of that levy will be

calculated by multiplying the levy by the ratio

of the Participant's total qualifying nonrecurring costs for research and development and

production of the equipment to all of the

Participants' total qualifying non-recurring

costs for research and development and production

of the equipment.

49
13.7. Levies for the equipment addressed in paragraphs 13.6. of

this Section will be collected for both Participants in

accordance with this Section, but in no event will levies

continue to be collected for a Participant after that

Participant's total qualifying non-recurring costs for that

equipment have been recouped. The U.S. DoD will be responsible

for collecting levies on behalf of both Participants and will

reimburse the ADOD based on the levies calculated in accordance

with this Section. The U.S. DoD will bear that responsibility

even if the U.S. DoD decides to reduce or waive its share of the

levies in accordance with paragraph 13.8. of this Section.

13.8. A Participant may reduce or waive the assessment of its

share of a levy on any Third Party sale or transfer.

50
SECTION XIV

LIABILITY AND CLAIMS

14.1. Claims arising under this MOU will be dealt with under

paragraph 1 of the Chapeau Agreement. Any costs, including

costs of claims, to be shared under paragraph 1.b)ii. of the

Chapeau Agreement will be shared in accordance with the ratio of

the Participants' shared Financial and Non-financial Costs.

14.2. The Contracting Participant will not indemnify Contractors

against liability for claims by any other persons.

51
SECTION XV

PARTICIPATION OF ADDITIONAL NATIONS

15.1. It is recognized that other national defense

organizations may wish to join the Project.

15.2. The U.S. DoD will consult with the ADOD prior to

conducting discussions with potential additional Participants.

The Participants will discuss the arrangements under which

another Participant might join, including the furnishing of

releasable Project Information for evaluation prior to joining.

If the disclosure of Project Information is necessary to conduct

discussions, such disclosure will be in accordance with Section

IX (Disclosure and Use of Project Information), Section X

(Controlled Unclassified Information), and Section XIII (Third

Party Sales and Transfers) of this MOU.

15.3. The Participants will jointly formulate the provisions

under which additional Participants might join. The addition of

new Participants to the Project will require amendment of this

MOU by the Participants.

52
SECTION XVI

CUSTOMS DUTIES, TAXES, AND SIMILAR CHARGES

16.1. Customs duties, import and export taxes, and similar

charges will be administered in accordance with each

Participant's respective laws and regulations. Insofar as

existing national laws and regulations permit, the Participants

will endeavor to ensure that such readily identifiable customs

duties, import and export taxes, and similar charges, as well as

quantitative or other restrictions on imports and exports, are

not imposed in connection with work carried out under this

Project.

16.2. Each Participant will use its best efforts to ensure that

customs duties, import and export taxes, and similar charges are

administered in a manner favorable to the efficient and

economical conduct of the work of this Project. If any such

customs duties, import and export taxes, or similar charges are

levied, the Participant in whose country they are levied will

bear such costs over and above that Participant's shared costs

of the Project.

53
SECTION XVII

SETTLEMENT OF DISPUTES

17.1. Disputes between the Participants arising under or

relating to this MOU will be resolved only by consultation

between the Participants and will not be referred to a national

court, an international tribunal, or to any other person or

entity for settlement.

54
SECTION XVIII

AMENDMENT, TERMINATION, ENTRY INTO EFFECT, AND DURATION

18.1. All activities of the Participants under this MOU will be

carried out in accordance with their respective national laws

and regulations, including their respective export control laws

and regulations. The responsibilities of the Participants will

be subject to the availability of funds for such purposes.

18.2. In the event of a conflict between a Section of this MOU

and any Annex to this MOU, the MOU will control.

18.3. Except as otherwise provided, this MOU may be amended by

the mutual written consent of the Participants. Annexes A, B,

and C of this MOU may be amended by the written approval of the

SC, provided that any such amendment is consistent with the

sections of this MOO.

18.4. This MOU may be terminated at any time upon the written

consent of the Participants. In the event both Participants

consent to terminate this MOU, the Participants will consult

prior to the date of termination to ensure termination in the

most economical and equitable manner.

18.5. Either Participant may terminate this MOU upon 90 days

written notification to the other Participant of its intent to

terminate. Such notice will be the subject of immediate

consultation by the SC to decide upon the appropriate course of

action to conclude the activities under this MOU. In the event

of such termination, the following rules apply:

18.5.1. The Participant terminating this MOU will

continue participation, financial or otherwise,

up to the effective date of termination.

18.5.2. Except as to Contracts awarded on behalf of

both Participants, each Participant will be

responsible for its own Project-related costs

associated with termination of the Project.

For Contracts awarded on behalf of both

Participants, the Participant terminating this

MOU will pay all Contract modification or

termination costs that would not otherwise have

been incurred but for the decision to

terminate; in no event, however, will a

55
18.5.3.

18.5.4.

18.5.5.

terminating Participant's total financial

contribution, including Contract termination

costs, exceed that Participant's total share of

the Financial Cost Ceiling for financial

contributions as established in Section V

(Financial Provisions) of this MOU.

Each Participant will be responsible for its

own Project-related costs associated with

termination of the Project.

All Project Information and rights therein

received under the provisions of this MOU prior

to the termination of this MOU will be retained

by the Participants, subject to the provisions

of this MOU.

If requested by the other Participant, the

terminating Participant may continue to

administer the Project Contract(s) that it

awarded on behalf of the other Participant on a

reimbursable basis.

18.6. The respective benefits and responsibilities of the

Participants regarding Section VIII (Project Equipment), Section

IX (Disclosure and Use of Project Information), Section X

(Controlled Unclassified Information), Section XII (Security),

Section XIII (Third Party Sales and Transfers), Section XIV

(Liability and Claims), and this Section XVIII (Amendment,

Termination, Entry into Effect, and Duration) of this MOU will

continue to apply notwithstanding termination or expiration of

this MOU.

18.7. This MOU, which consists of eighteen (18) Sections, and

four (4) Annexes, will enter into effect upon signature by both

Participants and will remain in effect for 8 (eight) years. It

may be extended by written concurrence of the Participants.

56
FOR THE DEPA' AP NT OF DEFENCE

OF AUSTRALI

The foregoing represents the understandings reached between the

Department of Defense of the United States of America and the

Department of Defence of Australia

Signed, in duplicate, in the English language.

FOR THE DEPARTMENT OF DEFENSE

OF THE UNITED STATES OF

AMERICA

Signature

SeAd J. stAc_KLEX

Name

A5d (R"I A )

Title

3 APR II- Zoo)

Date

PNTAGoAQ'

Location

S ature

4 i/tee-AAP/II 41/".114eddiJC

Name

A frmei ifis .0

Title

/7 d,t/c

Date

6^/8€7e/ZA r/Z_A 4

Location

57
ANNEX A

SYSTEM REQUIREMENTS AND AUSTRALIAN OPERATIONAL REQUIREMENTS

1. General Description of P-8A Poseidon Spiral 1 Operational

Requirement.

The P-8A Poseidon program was initiated in response to the Joint

Requirements Oversight Council (JROC) validated Mission Needs

Statement (MNS), "Broad Area Maritime and Littoral Armed

Intelligence, Surveillance and Reconnaissance," and the

requirements for the program are defined in the MMA Operational

Requirements Document (ORD)/ Capability Development Document

(CDD), validated and approved by JROC on December 8, 2003.

Subsequently, the acquisition plan approved for the P-8A was

based on procurement of a baseline capability and included

design, development testing and production of a capability to

meet ORD/CDD requirements. An evolutionary acquisition strategy

consisting of incremental capability improvements that will

retain cost-wise effectiveness for winning major combat

operations through 2020 was also approved in the acquisition

plan. The plan stated the baseline capability in initial

production P-8A aircraft will be updated using "Spirals" to

design develop operational capability to meet emerging threats.

The improved capability developed during the incremental

improvement programs will be forward and back fitted to insure

the operational capability of the P-8A weapon system continues

to meet operational requirements.

Operational requirements for the first increment of capability

improvements have been identified and be developed and baselined

in Spiral 1. The DON Spiral 1 core objectives shall be the

baseline requirements for the cooperative project and are listed

in paragraph 2.1. below. The Australian operational

requirements variations from this content of Spiral 1 will be

considered provided funds are supplied by ADOD, and the

variations do not unacceptably degrade existing system

performance or negatively affect incorporation of DON Spiral 1

requirements or impact Spiral 1 delivery schedules. The current

list of Australian operational requirements for consideration

are listed in paragraph 2.2. The capabilities in paragraph 2.1.

and 2.2. will be evaluated by the Participants and combined into

a consolidated final list. The Project will include a detailed

analysis of the critical technologies, technology maturity,

technical risk, and a cost assessment required to incorporate

the proposed capabilities.

58
2. Capabilities Required.

2.1. Candidate DON capabilities (Spiral 1 Priority): In order

to pace the threat, the Participants have concluded that the

capability improvements listed below are first priority for

Spiral 1 development. These capability improvements include,

but are not limited to:

Advanced Extended Echo Ranging System

Automatic Identification System

Acoustic Rapid Commercial-Off-The-Shelf Insertion

Integrated Broadcast Services

Capability upgrades to the Tactical Support Center

2.2. Candidate Australian Operational Requirements:

The ADOD has identified the following capability improvements as

possible Australian operational requirements.

Integration of MU90 torpedo

Integration of Harpoon Block II or III

Integration of Joint Air to Surface Standoff Missile

(JASSM)

JASSM-MI Link 16 mid-course guidance

Radar Auto Track

Radar Ground Moving Target Indicator

EO/IR upgrades (Rangefinder, Designator)

6th Crew Station

Barra sonobuoy integration

Air Launched Rescue Craft

2.3. Australian Integrated Ground Environment (IGE) and

Industry Capability Partner (ICP):

The ADOD has identified an Australian operational requirement to

integrate a variety of national systems with both P-8A and Broad

Area Maritime Surveillance (BAMS) Unnmanned Aerial System (UAS)

ground elements. The ADOD has designated an ICP who will be

under Contract to the ADOD to provide the IGE and associated

elements in order to accomplish this integration effort. The

U.S. DoD will assist the ADOD and the ICP on a not-to-interfere

basis with Project goals, schedules, and Contracting, in order

to facilitate and assist in the accomplishment of this effort in

terms of anticipated P-8A system interfaces with the IGE. If

necessary, the ADOD can request that the U.S. DoD Contract on

its behalf in order to accomplish elements of these efforts.

59
ANNEX B

JOINT PROJECT OFFICE ORGANIZATION

1. Staffing for the JPO will be as shown below.

Project Management

Project Steering Committee

USN Representative: PEO(A)

ADoD Representative

P-8A Program Manager (USN)

PMA-290

P-8A IPT Lead (USN)

PMA-290 M

P-8A Spiral 1 Project

USN Project Manager

USN Deputy Project Manager/RAAF Deputy Project Manager

JPO Staff

Mission Systems Aircraft Systems Interoperability Weapons Product Support Training

TABLE B-1

The ADOD may assign up to three CPP (a DPM and two IPT members).

The Steering Committee and the Project Manager will have the

responsibilities regarding CPP as set out in Annex D

(Cooperative Project Personnel).

60
ANNEX C

INVENTORY OF PROJECT EQUIPMENT EXCHANGES

NOMENCLATURE PART NO./

MODEL NO.

REPLACEMENT

VALUE

RECEIVING

PARTICIPANT

DATE

TRANSFERRED

61
ANNEX D

COOPERATIVE PROJECT PERSONNEL

1.0. Purpose and Scope

1.1. This Annex establishes the provisions that will govern the

conduct of Cooperative Project Personnel (CPP). The Parent

Participant will assign military members or civilian employees

to the JPO in accordance with Section IV (Management

(Organization and Responsibility)), Annex B (Joint Project

Office Organization), and this Annex. CPP must be able to

perform all the responsibilities assigned to them under this

MOU. Commencement of assignments will be subject to any

requirements that may be imposed by the Host Participant or its

Government regarding acceptance of CPP, such as, but not limited

to, visas and visit request documentation. The SC will

determine the length of tour for the positions at the time of

initial assignment.

1.2. CPP will be assigned to the JPO for Project work and will

report to their designated JPO supervisor regarding that work.

The PM will be responsible for the creation of a document

describing the duties of each CPP position, which will be

subject to approval by the SC. CPP will not act as liaison

officers on behalf of the Parent Participant. CPP may act from

time to time on behalf of their respective SC member if the

latter so authorizes in writing.

1.3. CPP will not be assigned to command or other positions

that would require them to exercise responsibilities that are

reserved by law or regulation to an officer or employee of the

Host Participant's Government.

2.0. Security

2.1. The SC will establish the maximum level of security

clearance required, if any, to permit CPP to have access to

Classified Information and facilities in which Classified

Information is used in accordance with the Project Security

Instruction (PSI) and Classification Guide (CG). Access to

Classified Information and facilities in which Classified

Information is used will be consistent with, and limited by,

Section II (Objectives) and Section III (Scope of Work) of this

MOU and will be kept to the minimum required to accomplish the

work assignments.

62
2.2. The Parent Participant will file visit requests for the

CPP through prescribed channels in compliance with the Host

Participant's procedures. As part of the visit request

procedures, the Parent Participant will cause security

assurances to be filed, through the Parent Participant's

government's embassy located in the Host Participant's country

specifying the security clearances for the CPP being assigned.

2.3. The Host Participant and Parent Participant will use their

best efforts to ensure that CPP assigned to the JPO are aware

of, and comply with, applicable laws and regulations as well as

the requirements of Section X (Controlled Unclassified

Information), Section XI (Visits to Establishments), Section XII

(Security), and paragraph 18.6. of Section XVIII (Amendment,

Termination, Entry into Effect, and Duration) of this MOU and

the provisions of the PSI and CG. Prior to commencing assigned

duties, CPP will, if required by the Host Participant

Government's laws, regulations, policies, or procedures, sign a

certification concerning the conditions and responsibilities of

CPP.

2.4. CPP will at all times be required to comply with the

security and export control laws, regulations, and procedures of

the Host Participant's Government. Any violation of security

procedures by CPP during their assignment will be reported to

the Parent Participant for appropriate action. CPP committing

significant violations of security and export control laws,

regulations, or procedures during their assignments will be

withdrawn from the Project with a view toward appropriate

administrative or disciplinary action by their Parent

Participant.

2.5. All Classified Information made available to CPP will be

considered as Classified Information furnished to the Parent

Participant, and will be subject to all provisions and

safeguards provided for in Section XII (Security), the PSI, and

CG.

2.6. CPP will not have personal custody of Classified

Information or Controlled Unclassified Information unless

approved by the Host Participant and as authorized by the Parent

Participant. They will be granted access to such Information in

accordance with Section X (Controlled Unclassified Information),

Section XII (Security) of this MOU, and the PSI during normal

duty hours at the JPO and when access is necessary to perform

Project work.

63
2.7. CPP assigned to the JPO will not serve as a conduit

between the Host Participant and Parent Participant for requests

and/or transmission of Classified Information or Controlled

Unclassified Information unless specifically authorized in the

PSI.

3.0. Technical and Administrative Matters

3.1. Consistent with the Host Participant's government laws and

regulations, and subject to applicable multilateral or bilateral

agreements or arrangements, CPP will be subject to the same

restrictions, conditions, and privileges as Host Participant

personnel of comparable rank and in comparable assignments.

Further, to the extent authorized by the Host Participant

Government's laws and regulations, and any applicable

multilateral or bilateral agreements or arrangements, CPP and

their authorized dependents will be accorded:

3.1.1 Exemption from any Host Participant's Government

tax upon income received from the Parent

Participant; and

3.1.2 Exemption from any Host Participant's Government

customs and import duties or similar charges

levied on items entering the country for their

official or personal use, including their

baggage, household effects, and private motor

vehicles.

3.2. On arrival, CPP will be provided briefings arranged by the

JPO about applicable laws, orders, regulations, and customs and

the need to comply with them. CPP will also be provided

briefings arranged by JPO regarding entitlements, privileges, and

obligations such as:

3.2.1. Any medical and dental care that may be provided

to CPP and their dependents at Host Participant

medical facilities, subject to the requirements

of applicable laws and regulations, including

reimbursement requirements.

3.2.2. Purchasing and patronage privileges at military

commissaries, exchanges, theaters, and clubs for

CPP and their dependents, subject to the

requirements of applicable laws and regulations.

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3.2.3. The Host Participant will provide, if available,

housing and messing facilities for CPP and their

dependents on the same basis and priority as for

its own personnel. CPP will pay messing and

housing charges to the same extent as Host

Participant personnel. At locations where

facilities are not provided by the Host

Participant for its own personnel, the Parent

Participant will make suitable arrangements for

its CPP.

3.2.4. Responsibility of CPP and their accompanying

dependents to obtain motor vehicle liability

insurance coverage in accordance with the laws

and regulations applicable in the area where they

are residing. In case of claims involving the

use of private motor vehicles by CPP, the

recourse will be against such insurance.

3.3. The PM, through the JPO, will, in consultation with the

CPP, establish standard operating procedures for CPP in the

following areas:

3.3.1. Working hours, including holiday schedules.

3.3.2. Leave authorization, consistent to the extent

possible with the military and civilian personnel

regulations and practices of the Host Participant

and Parent Participant.

3.3.3. Dress regulations, consistent to the extent

possible with the military and civilian personnel

regulations and practices of the Host Participant

and Parent Participant.

3.3.4. Performance evaluations, recognizing that such

evaluations will be rendered in accordance with

the Parent Participant's military or civilian

personnel regulations and practices.

3.4. CPP committing an offense under the laws of the Government

of the Host Participant or Parent Participant may be withdrawn

from this Project with a view toward further administrative or

disciplinary action by the Parent Participant. Disciplinary

action, however, will not be taken by the Host Participant

against CPP, nor will the CPP exercise disciplinary powers over

the Host Participant's personnel. In accordance with Host

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Participant Government's laws and regulations, the Host

Participant will assist the Parent Participant in carrying out

investigations of offenses involving CPP.

3.5. During their JPO assignment, CPP will not be placed in the

following duty status or environments unless mutually decided by

the SC:

3.5.1. Areas of political sensitivity where their

presence may jeopardize the interests of either

the Host Participant or Parent Participant, or

where, in the normal course of their duty, they

may become involved in activities that may

embarrass either Participant.

3.5.2. Deployments in non-direct hostility situations,

such as UN peacekeeping or multi-national

operations, or third countries.

3.5.3. Duty assignments in which direct hostilities are

likely. Should a JPO to which CPP are assigned

become involved in hostilities unexpectedly, CPP

assigned to that JPO will not be involved in the

hostilities. Any such CPP approved by the SC for

involvement in hostilities will be given specific

guidance as to the conditions under which the

assignment will be carried out by the appropriate

authorities of the Host Participant and Parent

Participant.

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