[Federal Register Volume 83, Number 147 (Tuesday, July 31, 2018)]
[Notices]
[Pages 36894-36897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-16316]


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DEPARTMENT OF DEFENSE

Office of the Secretary

[Transmittal No. 18-12]


Arms Sales Notification

AGENCY: Defense Security Cooperation Agency, Department of Defense.

ACTION: Arms sales notice.

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SUMMARY: The Department of Defense is publishing the unclassified text 
of an arms sales notification.

FOR FURTHER INFORMATION CONTACT: DSCA at <a href="/cdn-cgi/l/email-protection#68540948001a0d0e55" http: dsca.ncr.lmo.mbx.info">dsca.ncr.lmo.mbx.info</a>@mail.mil">dsca.ncr.lmo.mbx.info@mail.mil</a> 
or (703) 697-9709.

SUPPLEMENTARY INFORMATION: This 36(b)(1) arms sales notification is 
published to fulfill the requirements of section 155 of Public Law 104-
164 dated July 21, 1996. The following is a copy of a letter to the 
Speaker of the House of Representatives, Transmittal 18-12 with 
attached Policy Justification and Sensitivity of Technology.

    Dated: July 26, 2018.
Shelly E. Finke,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
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[GRAPHIC] [TIFF OMITTED] TN31JY18.022

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Transmittal No. 18-12
Notice of Proposed Issuance of Letter of Offer Pursuant to Section 
36(b)(1) of the Arms Export Control Act, as amended
    (i) Prospective Purchaser: Government of the Netherlands
    (ii) Total Estimated Value:

Major Defense Equipment *...............................     $60 million
Other...................................................     $10 million
                                                         ---------------
  TOTAL.................................................     $70 million
 

    (iii) Description and Quantity or Quantities of Articles or 
Services under Consideration for Purchase:
    Major Defense Equipment (MDE): Three thousand five hundred (3,500) 
M1156 Precision Guided Kit (PGK)
    Non-MDE: Also included are six (6) PGK settable trainers; two (2) 
PGK cut away models; one hundred (100) M76 PGK fuze wrenches; ten (10) 
Extended Length Artillery Projectile Extractors (ELAPEs); PGK technical 
data and publications; U.S. Government engineering and technical 
support services; and other related elements of logistics and program 
support.
    (iv) Military Department: Army (NE-B-WKA)
    (v) Prior Related Cases, if any: None
    (vi) Sales Commission, Fee, etc., Paid, Offered, or Agreed to be 
Paid: None
    (vii) Sensitivity of Technology Contained in the Defense Article or 
Defense Services Proposed to be Sold: See Attached Annex
    (viii) Date Report Delivered to Congress: April 24, 2018

    * As defined in Section 47(6) of the Arms Export Control Act.

POLICY JUSTIFICATION

Netherlands--M1156 Precision Guided Kits

    The Netherlands has requested to buy three thousand five hundred 
(3,500) M1156 Precision Guided Kits. Also included are six (6) PGK 
settable trainers; two (2) PGK cut away models; one hundred (100) M76 
PGK fuze wrenches; ten (10) Extended Length Artillery Projectile 
Extractors (ELAPEs); PGK technical data and publications; U.S. 
Government engineering and technical support services; and other 
related elements of logistics and program support. The estimated total 
cost is $70 million.
    This proposed sale will support the foreign policy and national 
security objectives of the United States by helping to improve the 
security of the Netherlands which is an important force for political 
stability and economic progress in Europe. It is important to the U.S. 
national interests to assist the Netherlands to develop and maintain a 
strong and ready self-defense capability. The Netherlands has been a 
consistent coalition partner supporting the United States in various 
coalition combat operations to include counter-ISIS, Stabilization 
Force in Iraq, and Afghanistan.
    The proposed sale of PGK will provide a precision guided capability 
to 155mm artillery projectiles and improve Netherlands's capability to 
meet current and future enemy threats. The Netherlands will use the 
enhanced capability to strengthen its homeland defenses, deter regional 
threats, and provide direct support to coalition and security 
cooperation efforts. The Netherlands will have no difficulty absorbing 
this equipment into its armed forces.
    The proposed sale of this equipment will not impact the basic 
military balance in the region.
    The principal contractor will be Orbital ATK. There are no known 
offset agreements proposed in connection with this potential sale. The 
purchaser typically requests offsets. Any offset agreement will be 
defined in negotiations between the purchaser and the contractor.
    Implementation of this sale will not require the assignment of any 
additional U.S. or contractor representatives to the Netherlands.
    There will be no adverse impact on U.S. defense readiness as a 
result of this proposed sale.
Transmittal No. 18-12
Notice of Proposed Issuance of Letter of Offer Pursuant to Section 
36(b)(1) of the Arms Export Control Act, as amended
Annex
Item No. vii
    (vii) Sensitivity of Technology:
    1. The M1156 Precision Guidance Kit (PGK) is a Global Positioning 
System (GPS) Precise Positioning Service (PPS) guided 155mm artillery 
projectile fuze. This effort includes the qualification of PGK on the 
Assegai M1711 Insensitive High Explosive (IHE) Base Bleed (BB) 
projectile with modular charges DM92 Charge 6 and PGK on the Assegai 
M1712 IHE Boat Tail (BT) projectile with modular charges DM92 Charges 5 
and 6, both fired from the Netherlands' PzH 2000 self-propelled 
howitzer.
    2. The M1156 utilizes the Enhanced Portable Electronic Fuze Setter 
(EPEFS) to set the PGK and the Portable Electronic Fire Control System 
(PEFCS) both purchased previously under a previous Excalibur FMS case. 
The PEFCS contain an Improved Platform Integration Kit (MK) to load GPS 
coordinates. Both the PGK and PEFCS contain the Selective Availability 
Anti-Spoofing Module (SAASM). The PGK has 90% commonality with the 
Army's XM395 Accelerated Precision Mortar Initiative (APMI). The PGK 
(the end-item) is unclassified. Transfer of the PGK may reveal 
information up to SECRET.
    3. The M1156 utilizes the Army's M782 Multi-Option for Artillery 
(MOFA) Proximity Height of Burst (HOB) Technology. The HOB sensor is 
comprised of components with technologies deemed as state of the art, 
requiring specialized production skills. The sensitive/critical 
technology is primarily in the design, development, production and 
manufacturing of the components (integrated circuits and assembly), and 
the integration methodology required to integrate those components onto 
an assembly to process embedded (the software-algorithm-working 
parameters). The HOB technology is classified SECRET.
    4. Disclosure of this technology could result in an adversary 
developing countermeasures, thus lessening the effect of the 
projectile. Disclosure of test data, countermeasures, vulnerability/
susceptibility analyses and threat definition could all aid reverse 
engineering and could be used by an adversary for possible use against 
U.S. and Coalition forces. Compromise could jeopardize the U.S. forces 
inventory through jammer development by adversaries. The risk of 
compromise has been accessed as moderate. Risk is reduced for fuze/
munitions if adequately controlled and protected in storage and on the 
battlefield. Risk is mitigated by the prevention of disclosure of 
sensitive classified information (the know-how, software, and 
associated documentation).
    5. If a technologically advanced adversary were to obtain knowledge 
of the specific hardware and software elements, the information could 
be used to develop countermeasures which might reduce weapon system 
effectiveness or be used in the development of a system with similar or 
advanced capabilities.
    6. A determination has been made that the Netherlands can provide 
the same degree of protection for the sensitive technology being 
release as the U.S. Government. This sale is necessary in furtherance 
of the U.S. foreign policy and national security objectives outlined in 
the Policy Justification.
    7. All defense articles and services listed in this transmittal 
have been

[[Page 36897]]

authorized for release and export to the Netherlands.

[FR Doc. 2018-16316 Filed 7-30-18; 8:45 am]
 BILLING CODE 5001-06-P


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