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based on the number of licenses and other authorizations 
expected to be received during such fiscal year. The Sec-
retary shall ensure that in meeting the requirement of this 
subsection, the performance of other functions of the Di-
rectorate of Defense Trade Controls is maintained and 
adequate staff is provided for those functions. 
(c) MINIMUM NUMBER OF STAFF FOR COMMODITY 
JURISDICTION DETERMINATIONS.—For each of the fiscal 
years 2009 through 2011, the Secretary of State shall en-
sure that the Directorate of Defense Trade Controls has, 
to the extent practicable, not less than three individuals 
assigned to review applications for commodity jurisdiction 
determinations. 
(d) ENFORCEMENT
RESOURCES.—In accordance 
with section 127.4 of title 22, Code of Federal Regula-
tions, U.S. Immigration and Customs Enforcement is au-
thorized to investigate violations of the International Traf-
fic in Arms Regulations on behalf of the Directorate of 
Defense Trade Controls of the Department of State. The 
Secretary of State shall ensure that the Directorate of De-
fense Trade Controls has adequate staffing for enforce-
ment of the International Traffic in Arms Regulations. 
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SEC. 106. AUDIT BY INSPECTOR GENERAL OF THE DEPART-
MENT OF STATE. 
(a) AUDIT.—Not later than the end of each of the 
fiscal years 2010 and 2011, the Inspector General of the 
Department of State shall conduct an independent audit 
to determine the extent to which the Department of State 
is meeting the requirements of sections 104 and 105 of 
this Act. 
(b) REPORT.—The Inspector General shall submit to 
the appropriate congressional committees a report that 
contains the result of each audit conducted under sub-
section (a). 
SEC. 107. INCREASED FLEXIBILITY FOR USE OF DEFENSE 
TRADE CONTROLS REGISTRATION FEES. 
(a) IN GENERAL.—Section 45 of the State Depart-
ment Basic Authorities Act of 1956 (22 U.S.C. 2717) is 
amended— 
(1) in the first sentence— 
(A) by striking ‘‘For’’ and inserting ‘‘(a) 
IN GENERAL.—For’’; and 
(B) by striking ‘‘Office’’ and inserting ‘‘Di-
rectorate’’; 
(2) by amending the second sentence to read as 
follows: 
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‘‘(b) AVAILABILITY OF FEES.—Fees credited to the 
account referred to in subsection (a) shall be available only 
for payment of expenses incurred for— 
‘‘(1) management, 
‘‘(2) licensing (in order to meet the require-
ments of section 105 of the Defense Trade Controls 
Performance Improvement Act of 2008 (relating to 
adequate staff and resources of the Directorate of 
Defense Trade Controls)), 
‘‘(3) compliance, 
‘‘(4) policy activities, and 
‘‘(5) facilities, 
of defense trade controls functions.’’; and 
(3) by adding at the end the following: 
‘‘(c) ALLOCATION OF FEES.—In allocating fees for 
payment of expenses described in subsection (b), the Sec-
retary of State shall accord the highest priority to pay-
ment of expenses incurred for personnel and equipment 
of the Directorate of Defense Trade Controls, including 
payment of expenses incurred to meet the requirements 
of section 105 of the Defense Trade Controls Performance 
Improvement Act of 2008.’’. 
(b) 
CONFORMING
AMENDMENT.—Section 
38(b)(3)(A) of the Arms Export Control Act (22 U.S.C. 
2778(b)(3)(A)) is amended to read as follows: 
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‘‘(3)(A) For each fiscal year, 100 percent of registra-
tion fees collected pursuant to paragraph (1) shall be cred-
ited to a Department of State account, to be available 
without fiscal year limitation. Fees credited to that ac-
count shall be available only for the payment of expenses 
incurred for— 
‘‘(i) management, 
‘‘(ii) licensing (in order to meet the require-
ments of section 105 of the Defense Trade Controls 
Performance Improvement Act of 2008 (relating to 
adequate staff and resources of the Directorate of 
Defense Trade Controls)), 
‘‘(iii) compliance, 
‘‘(iv) policy activities, and 
‘‘(v) facilities, 
of defense trade controls functions.’’. 
SEC. 108. REVIEW OF ITAR AND USML. 
(a) IN GENERAL.—The Secretary of State, in coordi-
nation with the heads of other relevant departments and 
agencies of the United States Government, shall review, 
with the assistance of United States manufacturers and 
other interested parties described in section 111(2) of this 
Act, the International Traffic in Arms Regulations and 
the United States Munitions List to determine those tech-
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nologies and goods that warrant different or additional 
controls. 
(b) CONDUCT OF REVIEW.—In carrying out the re-
view required under subsection (a), the Secretary of State 
shall review not less than 20 percent of the technologies 
and goods on the International Traffic in Arms Regula-
tions and the United States Munitions List in each cal-
endar year so that for the 5-year period beginning with 
calendar year 2009, and for each subsequent 5-year pe-
riod, the International Traffic in Arms Regulations and 
the United States Munitions List will be reviewed in their 
entirety. 
(c) REPORT.—The Secretary of State shall submit to 
the appropriate congressional committees and the Com-
mittee on Armed Services of the House of Representatives 
and the Committee on Armed Services of the Senate an 
annual report on the results of the review carried out 
under this section. 
SEC. 109. SPECIAL LICENSING AUTHORIZATION FOR CER-
TAIN EXPORTS TO NATO MEMBER STATES, 
AUSTRALIA, JAPAN, NEW ZEALAND, ISRAEL, 
AND SOUTH KOREA. 
(a) IN GENERAL.—Section 38 of the Arms Export 
Control Act (22 U.S.C. 2778) is amended by adding at 
the end the following: 
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‘‘(k) SPECIAL LICENSING AUTHORIZATION FOR CER-
TAIN EXPORTS TO NATO MEMBER STATES, AUSTRALIA, 
JAPAN, NEW ZEALAND, ISRAEL, AND SOUTH KOREA.— 
‘‘(1) AUTHORIZATION.—(A) The President may 
provide for special licensing authorization for exports 
of United States-manufactured spare and replace-
ment parts or components listed in an application 
for such special licensing authorization in connection 
with defense items previously exported to NATO 
member states, Australia, Japan, New Zealand, 
Israel, and South Korea. A special licensing author-
ization issued pursuant to this clause shall be effec-
tive for a period not to exceed 5 years. 
‘‘(B) An authorization may be issued under 
subparagraph (A) only if the applicable government 
of the country described in subparagraph (A), acting 
through the applicant for the authorization, certifies 
that— 
‘‘(i) the export of spare and replacement 
parts or components supports a defense item 
previously lawfully exported; 
‘‘(ii) the spare and replacement parts or 
components will be transferred to a defense 
agency of a country described in subparagraph 
(A) that is a previously approved end-user of 
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the defense items and not to a distributor or a 
foreign consignee of such defense items; 
‘‘(iii) the spare and replacement parts or 
components will not to be used to materially en-
hance, optimize, or otherwise modify or upgrade 
the capability of the defense items; 
‘‘(iv) the spare and replacement parts or 
components relate to a defense item that is 
owned, operated, and in the inventory of the 
armed forces a country described in subpara-
graph (A); 
‘‘(v) the export of spare and replacement 
parts or components will be effected using the 
freight forwarder designated by the purchasing 
country’s diplomatic mission as responsible for 
handling transfers under chapter 2 of this Act 
as required under regulations; and 
‘‘(vi) the spare and replacement parts or 
components to be exported under the special li-
censing authorization are specifically identified 
in the application. 
‘‘(C) An authorization may not be issued under 
subparagraph (A) for purposes of establishing off-
shore procurement arrangements or producing de-
fense articles offshore. 
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‘‘(D)(i) For purposes of this subsection, the 
term ‘United States-manufactured spare and re-
placement parts or components’ means
spare and 
replacement parts or components— 
‘‘(I) with respect to which— 
‘‘(aa) United States-origin content 
costs constitute at least 85 percent of the 
total content costs; 
‘‘(bb) United States manufacturing 
costs constitute at least 85 percent of the 
total manufacturing costs; and 
‘‘(cc) foreign content, if any, is limited 
to content from countries eligible to receive 
exports of items on the United States Mu-
nitions List under the International Traffic 
in Arms Regulations (other than de mini-
mis foreign content); 
‘‘(II) that were last substantially trans-
formed in the United States; and 
‘‘(III) that are not— 
‘‘(aa) classified as significant military 
equipment; or 
‘‘(bb) listed on the Missile Technology 
Control Regime Annex. 
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‘‘(ii) For purposes of clause (i)(I)(aa) and (bb), 
the costs of non-United States-origin content shall 
be determined using the final price or final cost as-
sociated with the non-United States-origin content. 
‘‘(2) INAPPLICABILITY
PROVISIONS.—(A) The 
provisions of this subsection shall not apply with re-
spect to re-exports or re-transfers of spare and re-
placement parts or components and related services 
of defense items described in paragraph (1). 
‘‘(B) The congressional notification require-
ments contained in section 36(c) of this Act shall 
not apply with respect to an authorization issued 
under paragraph (1).’’. 
(b) EFFECTIVE DATE.—The President shall issue 
regulations to implement amendments made by subsection 
(a) not later than 180 days after the date of the enactment 
of this Act. 
SEC. 110. AVAILABILITY OF INFORMATION ON THE STATUS 
OF LICENSE APPLICATIONS UNDER CHAPTER 
3 OF THE ARMS EXPORT CONTROL ACT. 
Chapter 3 of the Arms Export Control Act (22 
U.S.C. 2771 et seq.) is amended by inserting after section 
38 the following new section: 
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‘‘SEC. 38A. AVAILABILITY OF INFORMATION ON THE STA-
TUS OF LICENSE APPLICATIONS UNDER THIS 
CHAPTER. 
‘‘(a) AVAILABILITY
OF INFORMATION.—Not later 
than one year after the date of the enactment of the De-
fense Trade Controls Performance Improvement Act of 
2008, the President shall make available to persons who 
have pending license applications under this chapter and 
the committees of jurisdiction the ability to access elec-
tronically current information on the status of each license 
application required to be submitted under this chapter. 
‘‘(b) MATTERS TO BE INCLUDED.—The information 
referred to in subsection (a) shall be limited to the fol-
lowing: 
‘‘(1) The case number of the license application. 
‘‘(2) The date on which the license application 
is received by the Department of State and becomes 
an ‘open application’. 
‘‘(3) The date on which the Directorate of De-
fense Trade Controls makes a determination with re-
spect to the license application or transmits it for 
interagency review, if required. 
‘‘(4) The date on which the interagency review 
process for the license application is completed, if 
such a review process is required. 
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‘‘(5) The date on which the Department of 
State begins consultations with the congressional 
committees of jurisdiction with respect to the license 
application. 
‘‘(6) The date on which the license application 
is sent to the congressional committees of jurisdic-
tion.’’. 
SEC. 111. SENSE OF CONGRESS. 
It is the sense of Congress that— 
(1)(A) the advice provided to the Secretary of 
State by the Defense Trade Advisory Group 
(DTAG) supports the regulation of defense trade 
and helps ensure that United States national secu-
rity and foreign policy interests continue to be pro-
tected and advanced while helping to reduce unnec-
essary impediments to legitimate exports in order to 
support the defense requirements of United States 
friends and allies; and 
(B) therefore, the Secretary of State should 
share significant planned rules and policy shifts with 
DTAG for comment; and 
(2) recognizing the constraints imposed on the 
Department of State by the nature of a voluntary 
organization such as DTAG, the Secretary of State 
is encouraged to ensure that members of DTAG are 
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drawn from a representative cross-section of subject 
matter experts from the United States defense in-
dustry, relevant trade and labor associations, aca-
demic, and foundation personnel. 
SEC. 112. DEFINITIONS. 
In this subtitle: 
(1) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES.—The term ‘‘appropriate congressional com-
mittees’’ means the Committee on Foreign Affairs of 
the House of Representatives and the Committee on 
Foreign Relations of the Senate. 
(2) INTERNATIONAL TRAFFIC IN ARMS REGULA-
TIONS; ITAR.—The term ‘‘International Traffic in 
Arms Regulations’’ or ‘‘ITAR’’ means those regula-
tions contained in parts 120 through 130 of title 22, 
Code of Federal Regulations (or successor regula-
tions). 
(3) MAJOR NON-NATO ALLY.—The term ‘‘major 
non-NATO ally’’ means a country that is designated 
in accordance with section 517 of the Foreign As-
sistance Act of 1961 (22 U.S.C. 2321k) as a major 
non-NATO ally for purposes of the Foreign Assist-
ance Act of 1961 (22 U.S.C. 2151 et seq.) and the 
Arms Export Control Act (22 U.S.C. 2751 et seq.). 
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(4) MISSILE TECHNOLOGY CONTROL REGIME; 
MTCR.—The term ‘‘Missile Technology Control Re-
gime’’ or ‘‘MTCR’’ has the meaning given the term 
in section 11B(c)(2) of the Export Administration 
Act of 1979 (50 U.S.C. App. 2401b(c)(2)). 
(5) MISSILE
TECHNOLOGY
CONTROL
REGIME 
ANNEX; MTCR
ANNEX.—The term ‘‘Missile Tech-
nology Control Regime Annex’’ or ‘‘MTCR Annex’’ 
has the meaning given the term in section 11B(c)(4) 
of the Export Administration Act of 1979 (50 
U.S.C. App. 2401b(c)(4)). 
(6) OFFSETS.—The term ‘‘offsets’’ includes 
compensation practices required of purchase in ei-
ther government-to-government or commercial sales 
of defense articles or defense services under the 
Arms Export Control Act (22 U.S.C. 2751 et seq.) 
and the International Traffic in Arms Regulations. 
(7) UNITED STATES MUNITIONS LIST; USML.— 
The term ‘‘United States Munitions List’’ or 
‘‘USML’’ means the list referred to in section 
38(a)(1) of the Arms Export Control Act (22 U.S.C. 
2778(a)(1)). 
SEC. 113. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated such sums 
as may be necessary for fiscal year 2009 and each subse-
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quent fiscal year to carry out this subtitle and the amend-
ments made by this subtitle. 
Subtitle B—Miscellaneous 
Provisions 
SEC. 121. REPORT ON SELF-FINANCING OPTIONS FOR EX-
PORT LICENSING FUNCTIONS OF DDTC OF 
THE DEPARTMENT OF STATE. 
Not later than 90 days after the date of the enact-
ment of this Act, the Secretary of State shall submit to 
the appropriate congressional committees a report on pos-
sible mechanisms to place the export licensing functions 
of the Directorate of Defense Trade Controls of the De-
partment of State on a 100 percent self-financing basis. 
SEC. 122. EXPEDITING CONGRESSIONAL DEFENSE EXPORT 
REVIEW PERIOD FOR SOUTH KOREA AND 
ISRAEL. 
The Arms Export Control Act (22 U.S.C. 2751 et 
seq.) is amended— 
(1) 
in 
sections 
3(d)(2)(B), 
3(d)(3)(A)(i), 
3(d)(5), 
21(e)(2)(A), 
36(b)(2), 
36(c)(2)(A), 
36(d)(2)(A), 62(c)(1), and 63(a)(2) by inserting 
‘‘the Republic of Korea, Israel,’’ before ‘‘or New 
Zealand’’; 
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(2) in section 3(b)(2), by inserting ‘‘the Govern-
ment of the Republic of Korea,’’ before ‘‘or the Gov-
ernment of New Zealand’’; and 
(3) in section 21(h)(1)(A), by inserting ‘‘the 
Republic of Korea,’’ before ‘‘or Israel’’. 
SEC. 123. AVAILABILITY TO CONGRESS OF PRESIDENTIAL 
DIRECTIVES 
REGARDING 
UNITED 
STATES 
ARMS EXPORT POLICIES, PRACTICES, AND 
REGULATIONS. 
(a) IN GENERAL.—The President shall make avail-
able to the appropriate congressional committees the text 
of each Presidential directive regarding United States ex-
port policies, practices, and regulations relating to the im-
plementation of the Arms Export Control Act (22 U.S.C. 
2751 et seq.) not later than 15 days after the date on 
which the directive has been signed or authorized by the 
President. 
(b) TRANSITION PROVISION.—Any Presidential di-
rective described in subsection (a) that is signed or author-
ized by the President on or after January 1, 2008, and 
before the date of the enactment of this Act shall be made 
available to the appropriate congressional committees not 
later than 90 days after the date of the enactment of this 
Act. 
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(c) FORM.—To the maximum extent practicable, the 
Presidential directives required to be made available to the 
appropriate congressional committees under this section 
shall be made available on an unclassified basis. 
SEC. 124. INCREASE IN CONGRESSIONAL NOTIFICATION 
THRESHOLDS AND EXPEDITING CONGRES-
SIONAL REVIEW FOR SOUTH KOREA AND 
ISRAEL. 
(a) FOREIGN MILITARY SALES.— 
(1) IN GENERAL.—Subsection (b) of section 36 
of the Arms Export Control Act (22 U.S.C. 2776) 
is amended— 
(A) 
by 
redesignating 
paragraphs 
(2) 
through (6) as paragraphs (3) through (7), re-
spectively; and 
(B) by striking ‘‘The letter of offer shall 
not be issued’’ and all that follows through ‘‘en-
acts a joint resolution’’ and inserting the fol-
lowing: 
‘‘(2) The letter of offer shall not be issued— 
‘‘(A) with respect to a proposed sale of any 
defense articles or defense services under this 
Act for $200,000,000 or more, any design and 
construction services for $300,000,000 or more, 
or 
any 
major 
defense 
equipment 
for 
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$75,000,000 or more, to the North Atlantic 
Treaty Organization (NATO), any member 
country of NATO, Japan, Australia, the Repub-
lic of Korea, Israel, or New Zealand, if Con-
gress, within 15 calendar days after receiving 
such certification, or 
‘‘(B) with respect to a proposed sale of any 
defense articles or services under this Act for 
$100,000,000 or more, any design and con-
struction services for $200,000,000 or more, or 
any major defense equipment for $50,000,000 
or more, to any other country or organization, 
if Congress, within 30 calendar days after re-
ceiving such certification, 
enacts a joint resolution’’. 
(2) TECHNICAL
AND
CONFORMING
AMEND-
MENTS.—Such section is further amended— 
(A) in subsection (b)— 
(i) in paragraph (6)(C), as redesig-
nated, by striking ‘‘Subject to paragraph 
(6), if’’ and inserting ‘‘If’’; and 
(ii) by striking paragraph (7), as re-
designated; and 
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(B) in subsection (c)(4), by striking ‘‘sub-
section (b)(5)’’ each place it appears and insert-
ing ‘‘subsection (b)(6)’’. 
(b) COMMERCIAL SALES.—Subsection (c) of such sec-
tion is amended— 
(1) in paragraph (2)— 
(A) in subparagraph (A)— 
(i) by inserting after ‘‘for an export’’ 
the following: ‘‘of any major defense equip-
ment sold under a contract in the amount 
of $75,000,000 or more or of defense arti-
cles or defense services sold under a con-
tract in the amount of $200,000,000 or 
more, (or, in the case of a defense article 
that is a firearm controlled under category 
I of the United States Munitions List, 
$1,000,000 or more)’’; and 
(ii) by striking ‘‘Organization,’’ and 
inserting ‘‘Organization (NATO),’’ and by 
further striking ‘‘that Organization’’ and 
inserting ‘‘NATO’’; and 
(B) in subparagraph (C), by inserting after 
‘‘license’’ the following: ‘‘for an export of any 
major defense equipment sold under a contract 
in the amount of $50,000,000 or more or of de-
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fense articles or defense services sold under a 
contract in the amount of $100,000,000 or 
more, (or, in the case of a defense article that 
is a firearm controlled under category I of the 
United States Munitions List, $1,000,000 or 
more)’’; and 
(2) by striking paragraph (5). 
SEC. 125. DIPLOMATIC EFFORTS TO STRENGTHEN NA-
TIONAL AND INTERNATIONAL ARMS EXPORT 
CONTROLS. 
(a) SENSE OF CONGRESS.—It is the sense of Con-
gress that the President should redouble United States 
diplomatic efforts to strengthen national and international 
arms export controls by establishing a senior-level initia-
tive to ensure that such arms export controls are com-
parable to and supportive of United States arms export 
controls, particularly with respect to countries of concern 
to the United States. 
(b) REPORT.—No later than one year after the date 
of the enactment of this Act, and annually thereafter for 
four years, the President shall transmit to the appropriate 
committees of Congress a report on United States diplo-
matic efforts described in subsection (a). 
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SEC. 126. REPORTING REQUIREMENT FOR UNLICENSED EX-
PORTS. 
Section 655(b) of the Foreign Assistance Act of 1961 
(22 U.S.C. 2415(b)) is amended— 
(1) in paragraph (2), by striking ‘‘or’’ at the 
end; 
(2) in paragraph (3), by striking the period at 
the end and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(4) were exported without a license under sec-
tion 38 of the Arms Export Control Act (22 U.S.C. 
2778) pursuant to an exemption established under 
the International Traffic in Arms Regulations, other 
than defense articles exported in furtherance of a 
letter of offer and acceptance under the Foreign 
Military Sales program or a technical assistance or 
manufacturing license agreement, including the spe-
cific exemption provision in the regulation under 
which the export was made.’’. 
SEC. 127. REPORT ON VALUE OF MAJOR DEFENSE EQUIP-
MENT AND DEFENSE ARTICLES EXPORTED 
UNDER SECTION 38 OF THE ARMS EXPORT 
CONTROL ACT. 
Section 38 of the Arms Export Control Act (22 
U.S.C. 2778) is amended by adding at the end the fol-
lowing: 
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‘‘(l) REPORT.— 
‘‘(1) IN GENERAL.—The President shall trans-
mit to the appropriate congressional committees a 
report that contains a detailed listing, by country 
and by international organization, of the total dollar 
value of major defense equipment and defense arti-
cles exported pursuant to licenses authorized under 
this section for the previous fiscal year. 
‘‘(2) INCLUSION IN ANNUAL BUDGET.—The re-
port required by this subsection shall be included in 
the supporting information of the annual budget of 
the United States Government required to be sub-
mitted to Congress under section 1105 of title 31, 
United States Code. 
‘‘(3) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES DEFINED.—In this subsection, the term ‘ap-
propriate congressional committees’ means the Com-
mittee on Foreign Affairs of the House of Rep-
resentatives and the Committee on Foreign Rela-
tions of the Senate.’’. 
SEC. 128. REPORT ON SATELLITE EXPORT CONTROLS. 
(a) REPORT.—Not later than 180 days after the date 
of the enactment of this Act, the President shall transmit 
to the appropriate congressional committees and the Com-
mittee on Armed Services of the House of Representatives 
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and the Committee on Armed Services of the Senate a 
report regarding— 
(1) the extent to which current United States 
export controls on satellites and related items under 
the Arms Export Control Act are successfully pre-
venting the transfer of militarily-sensitive tech-
nologies to countries of concern, especially the Peo-
ple’s Republic of China; 
(2) the extent to which comparable satellites 
and related items are available from foreign sources 
without comparable export controls; and 
(3) whether the current export controls on sat-
ellites and related items should be altered and in 
what manner, including whether other incentives or 
disincentives should also be employed to discourage 
exports of satellites and related items to the People’s 
Republic of China by any country. 
(b) DEFINITIONS.—In this section, the terms ‘‘sat-
ellite’’ and ‘‘related items’’ mean satellites and all specifi-
cally designed or modified systems or subsystems, compo-
nents, parts, accessories, attachments, and associated 
equipment for satellites as covered under category XV of 
the International Traffic in Arms Regulations (as in effect 
on the date of the enactment of this Act). 
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SEC. 129. DEFINITION. 
In this subtitle, the term ‘‘appropriate congressional 
committees’’ means the Committee on Foreign Affairs of 
the House of Representatives and the Committee on For-
eign Relations of the Senate. 
TITLE 
II—SECURITY 
ASSIST-
ANCE 
AND 
RELATED 
SUP-
PORT FOR ISRAEL 
SEC. 201. ASSESSMENT OF ISRAEL’S QUALITATIVE MILI-
TARY EDGE OVER MILITARY THREATS. 
(a) ASSESSMENT REQUIRED.—The President shall 
carry out an empirical and qualitative assessment on an 
ongoing basis of the extent to which Israel possesses a 
qualitative military edge over military threats to Israel. 
The assessment required under this subsection shall be 
sufficiently robust so as to facilitate comparability of data 
over concurrent years. 
(b) USE OF ASSESSMENT.—The President shall en-
sure that the assessment required under subsection (a) is 
used to inform the review by the United States of applica-
tions to sell defense articles and defense services under 
the Arms Export Control Act (22 U.S.C. 2751 et seq.) 
to countries in the Middle East. 
(c) REPORTS.— 
(1) INITIAL REPORT.—Not later than 180 days 
after the date of the enactment of this Act, the 
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President shall transmit to the appropriate congres-
sional committees a report on the initial assessment 
required under subsection (a). 
(2) QUADRENNIAL
REPORT.—Not later than 
four years after the date on which the President 
transmits the initial report under paragraph (1), 
and every four years thereafter, the President shall 
transmit to the appropriate congressional commit-
tees a report on the most recent assessment required 
under subsection (a). 
(d) CERTIFICATION.—Section 36 of the Arms Export 
Control Act (22 U.S.C. 2776) is amended by adding at 
the end the following: 
‘‘(h) 
CERTIFICATION
REQUIREMENT
RELATING 
ISRAEL’S QUALITATIVE MILITARY EDGE.— 
‘‘(1) IN GENERAL.—Any certification relating 
to a proposed sale or export of defense articles or 
defense services under this section to any country in 
the Middle East other than Israel shall include a de-
termination that the sale or export of the defense ar-
ticles or defense services will not adversely affect 
Israel’s qualitative military edge over military 
threats to Israel. 
‘‘(2) DEFINITION.—In this subsection, the term 
‘qualitative military edge’ has the meaning given the 
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term in section 205 of the Security Assistance and 
Arms Export Control Reform Act of 2008.’’. 
SEC. 202. REPORT ON UNITED STATES’ COMMITMENTS TO 
THE SECURITY OF ISRAEL. 
(a) INITIAL REPORT.—Not later than 30 days after 
the date of the enactment of this Act, the President shall 
transmit to the appropriate congressional committees a re-
port that contains— 
(1) a complete, unedited, and unredacted copy 
of each assurance made by United States Govern-
ment officials to officials of the Government of Israel 
regarding Israel’s security and maintenance of 
Israel’s qualitative military edge, as well as any 
other assurance regarding Israel’s security and 
maintenance of Israel’s qualitative military edge pro-
vided in conjunction with exports under the Arms 
Export Control Act (22 U.S.C. 2751 et seq.), for the 
period beginning on January 1, 1975, and ending on 
the date of the enactment of this Act; and 
(2) an analysis of the extent to which, and by 
what means, each such assurance has been and is 
continuing to be fulfilled. 
(b) SUBSEQUENT REPORTS.— 
(1) NEW
ASSURANCES
AND
REVISIONS.—The 
President shall transmit to the appropriate congres-
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sional committees a report that contains the infor-
mation required under subsection (a) with respect 
to— 
(A) each assurance described in subsection 
(a) made on or after the date of the enactment 
of this Act, or 
(B) revisions to any assurance described in 
subsection (a) or subparagraph (A) of this 
paragraph, 
within 15 days of the new assurance or revision 
being conveyed. 
(2) 5-YEAR REPORTS.—Not later than 5 years 
after the date of the enactment of this Act, and 
every 5 years thereafter, the President shall trans-
mit to the appropriate congressional committees a 
report that contains the information required under 
subsection (a) with respect to each assurance de-
scribed in subsection (a) or paragraph (1)(A) of this 
subsection and revisions to any assurance described 
in subsection (a) or paragraph (1)(A) of this sub-
section during the preceding 5-year period. 
(c) FORM.—Each report required by this section shall 
be transmitted in unclassified form, but may contain a 
classified annex, if necessary. 
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SEC. 203. WAR RESERVES STOCKPILE. 
(a) DEPARTMENT
OF DEFENSE APPROPRIATIONS 
ACT, 2005.—Section 12001(d) of the Department of De-
fense Appropriations Act, 2005 (Public Law 108–287; 
118 Stat. 1011), is amended by striking ‘‘4’’ and inserting 
‘‘6’’. 
(b) FOREIGN ASSISTANCE ACT OF 1961.—Section 
514(b)(2)(A) of the Foreign Assistance Act of 1961 (22 
U.S.C. 2321h(b)(2)(A)) is amended by striking ‘‘fiscal 
years 2007 and 2008’’ and inserting ‘‘fiscal years 2009 
and 2010’’. 
(c) EFFECTIVE DATE.—The amendment made by 
subsection (a) takes effect on August 5, 2008. 
SEC. 204. IMPLEMENTATION OF MEMORANDUM OF UNDER-
STANDING WITH ISRAEL. 
(a) IN GENERAL.—Of the amount made available for 
fiscal year 2009 for assistance under the program author-
ized by section 23 of the Arms Export Control Act (22 
U.S.C. 2763) (commonly referred to as the ‘‘Foreign Mili-
tary Financing Program’’), the amount specified in sub-
section (b) is authorized to be made available on a grant 
basis for Israel. 
(b) COMPUTATION OF AMOUNT.—The amount re-
ferred to in subsection (a) is the amount equal to— 
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(1) the amount specified under the heading 
‘‘Foreign Military Financing Program’’ for Israel for 
fiscal year 2008; plus 
(2) $150,000,000. 
(c) OTHER AUTHORITIES.— 
(1) AVAILABILITY OF FUNDS FOR ADVANCED 
WEAPONS SYSTEMS.—To the extent the Government 
of Israel requests the United States to provide as-
sistance for fiscal year 2009 for the procurement of 
advanced weapons systems, amounts authorized to 
be made available for Israel under this section shall, 
as agreed to by Israel and the United States, be 
available for such purposes, of which not less than 
$670,650,000 shall be available for the procurement 
in Israel of defense articles and defense services, in-
cluding research and development. 
(2) DISBURSEMENT OF FUNDS.—Amounts au-
thorized to be made available for Israel under this 
section shall be disbursed not later than 30 days 
after the date of the enactment of an Act making 
appropriations for the Department of State, foreign 
operations, and related programs for fiscal year 
2009, or October 31, 2008, whichever occurs later. 
SEC. 205. DEFINITIONS. 
In this subtitle— 
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(1) the term ‘‘appropriate congressional com-
mittees’’ means the Committee on Foreign Affairs of 
the House of Representatives and the Committee on 
Foreign Relations of the Senate; and 
(2) the term ‘‘qualitative military edge’’ means 
the ability to counter and defeat any credible con-
ventional military threat from any individual state or 
possible coalition of states or from non-state actors, 
while sustaining minimal damages and casualties, 
through the use of superior military means, pos-
sessed in sufficient quantity, including weapons, 
command, control, communication, intelligence, sur-
veillance, and reconnaissance capabilities that in 
their technical characteristics are superior in capa-
bility to those of such other individual or possible co-
alition of states or non-state actors. 
TITLE III—WAIVER OF CERTAIN 
SANCTIONS 
TO 
FACILITATE 
DENUCLEARIZATION ACTIVI-
TIES IN NORTH KOREA 
SEC. 301. WAIVER AUTHORITY AND EXCEPTIONS. 
(a) WAIVER AUTHORITY.—Except as provided in 
subsection (b), the President may waive, in whole or in 
part, the application of any sanction contained in subpara-
graph (A), (B), (D), or (G) of section 102(b)(2) of the 
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Arms Export Control Act (22 U.S.C. 2799aa–1(b)(2)) 
with respect to North Korea in order to provide material, 
direct, and necessary assistance for disablement, dis-
mantlement, verification, and physical removal activities 
in the implementation of the commitment of North Korea, 
undertaken in the Joint Statement of September 19, 
2005, ‘‘to abandoning all nuclear weapons and existing 
nuclear 
programs’’ 
as 
part 
of 
the 
verifiable 
denuclearization of the Korean Peninsula. 
(b) EXCEPTIONS.—The waiver authority under sub-
section (a) may not be exercised with respect to the fol-
lowing: 
(1) Any export of lethal defense articles that 
would be prevented by the application of section 
102(b)(2)(B) of the Arms Export Control Act. 
(2) Any sanction relating to credit or credit 
guarantees contained in section 102(b)(2)(D) of the 
Arms Export Control Act. 
SEC. 302. CERTIFICATION REGARDING WAIVER OF CER-
TAIN SANCTIONS. 
Assistance described in subparagraph (B) or (G) of 
section 102(b)(2) of the Arms Export Control Act (22 
U.S.C. 2799aa–1(b)(2)) may be provided with respect to 
North Korea by reason of the exercise of the waiver au-
thority under section 301 only if the President first deter-
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mines and certifies to the appropriate congressional com-
mittees that— 
(1) all necessary steps will be taken to ensure 
that the assistance will not be used to improve the 
military capabilities of the armed forces of North 
Korea; and 
(2) the exercise of the waiver authority is in the 
national security interests of the United States. 
SEC. 303. CONGRESSIONAL NOTIFICATION AND REPORT. 
(a) NOTIFICATION.—The President shall notify the 
appropriate congressional committees in writing not later 
than 15 days before exercising the waiver authority under 
section 301. 
(b) REPORT.—Not later than 60 days after the date 
of the enactment of this Act, and annually thereafter for 
such time during which the exercise of the waiver author-
ity under section 301 remains in effect, the President shall 
transmit to the appropriate congressional committees a re-
port that— 
(1) describes in detail the progress that is being 
made in the implementation of the commitment of 
North Korea described in section 301, including all 
United States and international activities to verify 
compliance with such commitment; 
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(2) describes in detail any failures, short-
comings, or obstruction by North Korea with respect 
to the implementation of the commitment of North 
Korea described in section 301; 
(3) describes in detail the progress or lack 
thereof in the preceding 12-month period of all other 
programs promoting the elimination of North Ko-
rea’s capability to develop, deploy, transfer, or main-
tain weapons of mass destruction or their delivery 
systems; 
(4) describes in detail all United States assist-
ance, regardless of the source, provided to North 
Korea by reason of the exercise of the waiver au-
thority under section 301 and any assistance pro-
vided under any other authority if such assistance is 
provided for the same or similar purposes; and 
(5) beginning with the second report required 
by this subsection, a justification for the continu-
ation of the waiver exercised under section 301 and, 
if applicable, section 302, for the fiscal year in which 
the report is submitted. 
SEC. 304. TERMINATION OF WAIVER AUTHORITY. 
Any waiver in effect by reason of the exercise of the 
waiver authority under section 301 shall terminate if the 
President determines that North Korea— 
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(1)(A) on or after September 19, 2005, trans-
ferred to a non-nuclear-weapon state, or received, a 
nuclear explosive device; or 
(B) on or after October 10, 2006, detonated a 
nuclear explosive device; or 
(2) on or after September 19, 2005— 
(A) transferred to a non-nuclear-weapon 
state any design information or component 
which is determined by the President to be im-
portant to, and known by North Korea to be in-
tended by the recipient state for use in, the de-
velopment or manufacture of any nuclear explo-
sive device, or 
(B) sought and received any design infor-
mation or component which is determined by 
the President to be important to, and intended 
by North Korea for use in, the development or 
manufacture of any nuclear explosive device, 
unless the President determines and certifies to the 
appropriate congressional committees that such 
waiver is vital to the national security interests of 
the United States. 
SEC. 305. EXPIRATION OF WAIVER AUTHORITY. 
Any waiver in effect by reason of the exercise of the 
waiver authority under section 301 shall terminate on the 
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date that is 4 years after the date of the enactment of 
this Act. The waiver authority under section 301 may not 
be exercised beginning on the date that is 3 years after 
the date of the enactment of this Act. 
SEC. 306. CONTINUATION OF RESTRICTIONS AGAINST THE 
GOVERNMENT OF NORTH KOREA. 
(a) IN GENERAL.—Except as provided in section 
301(a), restrictions against the Government of North 
Korea that were imposed by reason of a determination of 
the Secretary of State that North Korea is a state sponsor 
of terrorism shall remain in effect, and shall not be lifted 
pursuant to the provisions of law under which the deter-
mination was made, unless the President certifies to the 
appropriate congressional committees that— 
(1) the Government of North Korea is no 
longer engaged in the transfer of technology related 
to the acquisition or development of nuclear weap-
ons, particularly to the Governments of Iran, Syria, 
or any other country that is a state sponsor of ter-
rorism; 
(2) in accordance with the Six-Party Talks 
Agreement of February 13, 2007, the Government 
of North Korea has ‘‘provided a complete and cor-
rect declaration of all its nuclear programs,’’ and 
there are measures to effectively verify this declara-
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tion by the United States which, ‘‘[a]t the request 
of the other Parties,’’ is leading ‘‘disablement activi-
ties’’ and ‘‘provid[ing] the funding for those activi-
ties’’; and 
(3) the Government of North Korea has agreed 
to the participation of the International Atomic En-
ergy Agency in the monitoring and verification of 
the shutdown and sealing of the Yongbyon nuclear 
facility. 
(b) STATE SPONSOR OF TERRORISM DEFINED.—In 
this section, the term ‘‘state sponsor of terrorism’’ means 
a country the government of which the Secretary of State 
has determined, for purposes of section 6(j) of the Export 
Administration Act of 1979 (as continued in effect pursu-
ant to the International Emergency Economic Powers 
Act), section 40 of the Arms Export Control Act, section 
620A of the Foreign Assistance Act of 1961, or any other 
provision of law, is a government that has repeatedly pro-
vided support for acts of international terrorism. 
SEC. 307. REPORT ON VERIFICATION MEASURES RELATING 
TO NORTH KOREA’S NUCLEAR PROGRAMS. 
(a) IN GENERAL.—Not later than 15 days after the 
date of enactment of this Act, the Secretary of State shall 
submit to the appropriate congressional committees a re-
port on verification measures relating to North Korea’s 
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nuclear programs under the Six-Party Talks Agreement 
of February 13, 2007, with specific focus on how such 
verification measures are defined under the Six-Party 
Talks Agreement and understood by the United States 
Government. 
(b) MATTERS TO BE INCLUDED.—The report re-
quired under subsection (a) shall include, among other ele-
ments, a detailed description of— 
(1) the methods to be utilized to confirm that 
North Korea has ‘‘provided a complete and correct 
declaration of all of its nuclear programs’’; 
(2) the specific actions to be taken in North 
Korea and elsewhere to ensure a high and ongoing 
level of confidence that North Korea has fully met 
the terms of the Six-Party Talks Agreement relating 
to its nuclear programs; 
(3) any formal or informal agreement with 
North Korea regarding verification measures relat-
ing to North Korea’s nuclear programs under the 
Six-Party Talks Agreement; and 
(4) any disagreement expressed by North Korea 
regarding verification measures relating to North 
Korea’s nuclear programs under the Six-Party Talks 
Agreement. 
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(c) FORM.—The report required under subsection (a) 
shall be submitted in unclassified form, but may include 
a classified annex. 
SEC. 308. DEFINITIONS. 
In this title— 
(1) the term ‘‘appropriate congressional com-
mittees’’ means— 
(A) the Committee on Foreign Affairs, the 
Committee on Appropriations, and the Com-
mittee on Armed Services of the House of Rep-
resentatives; and 
(B) the Committee on Foreign Relations, 
the Committee on Appropriations, the Com-
mittee on Armed Services of the Senate; 
(2) the terms ‘‘non-nuclear-weapon state’’, ‘‘de-
sign information’’, and ‘‘component’’ have the mean-
ings given such terms in section 102 of the Arms 
Export Control Act (22 U.S.C. 2799aa–1); and 
(3) the term ‘‘Six-Party Talks Agreement of 
February 13, 2007’’ or ‘‘Six-Party Talks Agree-
ment’’ means the action plan released on February 
13, 2007, of the Third Session of the Fifth Round 
of the Six-Party Talks held in Beijing among the 
People’s Republic of China, the Democratic People’s 
Republic of Korea (North Korea), Japan, the Re-
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public of Korea (South Korea), the Russian Federa-
tion, and the United States relating to the 
denuclearization of the Korean Peninsula, normal-
ization of relations between the North Korea and the 
United States, normalization of relations between 
North Korea and Japan, economy and energy co-
operation, and matters relating to the Northeast 
Asia Peace and Security Mechanism. 
TITLE IV—MISCELLANEOUS 
PROVISIONS 
SEC. 401. AUTHORITY TO BUILD THE CAPACITY OF FOR-
EIGN MILITARY FORCES. 
(a) AUTHORITY.—The Secretary of State is author-
ized to conduct a program to respond to contingencies in 
foreign countries or regions by providing training, pro-
curement, and capacity-building of a foreign country’s na-
tional military forces and dedicated counter-terrorism 
forces in order for that country to— 
(1) conduct counterterrorist operations; or 
(2) participate in or support military and sta-
bility operations in which the United States is a par-
ticipant. 
(b) TYPES OF CAPACITY-BUILDING.—The program 
authorized under subsection (a) may include the provision 
of equipment, supplies, and training. 
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(c) LIMITATIONS.— 
(1) ANNUAL FUNDING LIMITATION.—The Sec-
retary of State may use up to $25,000,000 of funds 
available under the Foreign Military Financing pro-
gram for each of the fiscal years 2009 and 2010 to 
conduct the program authorized under subsection 
(a). 
(2) ASSISTANCE
OTHERWISE
PROHIBITED
BY 
LAW.—The Secretary of State may not use the au-
thority in subsection (a) to provide any type of as-
sistance described in subsection (b) that is otherwise 
prohibited by any provision of law. 
(3) LIMITATION
ON
ELIGIBLE
COUNTRIES.— 
The Secretary of State may not use the authority in 
subsection (a) to provide assistance described in sub-
section (b) to any foreign country that is otherwise 
prohibited from receiving such type of assistance 
under any other provision of law. 
(d) FORMULATION
AND EXECUTION
OF ACTIVI-
TIES.—The Secretary of State shall consult with the head 
of any other appropriate department or agency in the for-
mulation and execution of the program authorized under 
subsection (a). 
(e) CONGRESSIONAL NOTIFICATION.— 
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(1) ACTIVITIES IN A COUNTRY.—Not less than 
15 days before obligating funds for activities in any 
country under the program authorized under sub-
section (a), the Secretary of State shall submit to 
the congressional committees specified in paragraph 
(3) a notice of the following: 
(A) The country whose capacity to engage 
in activities in subsection (a) will be assisted. 
(B) The budget, implementation timeline 
with milestones, and completion date for com-
pleting the activities. 
(2) 
SPECIFIED
CONGRESSIONAL
COMMIT-
TEES.—The congressional committees specified in 
this paragraph are the following: 
(A) The Committee on Foreign Affairs and 
the Committee on Appropriations of the House 
of Representatives. 
(B) The Committee on Foreign Relations 
and the Committee on Appropriations of the 
Senate. 
SEC. 402. MAINTENANCE OF EUROPEAN UNION ARMS EM-
BARGO AGAINST CHINA. 
(a) FINDINGS.—Congress makes the following find-
ings: 
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