To authorize the transfer of naval vessels to certain foreign recipients, and for other purposes.

TITLE I--NAVAL VESSEL TRANSFER

SECTION 101. SHORT TITLE.
    This title may be cited as the ``Naval Vessel Transfer Act of 
2008''.
    SEC. 102. TRANSFER OF NAVAL VESSELS TO CERTAIN FOREIGN RECIPIENTS.
    (a) Transfers by Grant.--The President is authorized to transfer 
the vessels specified in paragraphs (1), (3), and (4) of section 501(a) 
of H.R. 5916 of the 110th Congress, as passed the House of 
Representatives on May 15, 2008, to the foreign recipients specified in 
paragraphs (1), (3), and (4) of such section, respectively, on a grant 
basis under section 516 of the Foreign Assistance Act of 1961 (22 
U.S.C. 2321j).
    (b) Grants Not Counted in Annual Total of Transferred Excess 
Defense Articles.--The value of a vessel transferred to a recipient on 
a grant basis pursuant to authority provided by subsection (a) shall 
not be counted against the aggregate value of excess defense articles 
transferred in any fiscal year under section 516 of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2321j).
    (c) Costs of Transfers.--Any expense incurred by the United States 
in connection with a transfer authorized by this section shall be 
charged to the recipient (notwithstanding section 516(e) of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2321j(e))).
    (d) Repair and Refurbishment in United States Shipyards.--To the 
maximum extent practicable, the President shall require, as a condition 
of the transfer of a vessel under this section, that the recipient to 
which the vessel is transferred have such repair or refurbishment of 
the vessel as is needed, before the vessel joins the naval forces of 
the recipient, performed at a shipyard located in the United States, 
including a United States Navy shipyard.
    (e) Expiration of Authority.--The authority to transfer a vessel 
under this section shall expire at the end of the 2-year period 
beginning on the date of the enactment of this Act.

                  TITLE II--UNITED STATES ARMS EXPORTS

    SEC. 201. ASSESSMENT OF ISRAEL'S QUALITATIVE MILITARY 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 ensure that the 
assessment required under subsection (a) is used to inform the review 
by the United States of applications 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 June 30, 2009, the 
    President shall transmit to the appropriate congressional 
    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 committees 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 to 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 determination that the sale or export of the defense 
    articles or defense services will not adversely affect Israel's 
    qualitative military edge over military threats to Israel.
        ``(2) Qualitative military edge defined.--In this subsection, 
    the term `qualitative military edge' means the ability to counter 
    and defeat any credible conventional 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, possessed in sufficient 
    quantity, including weapons, command, control, communication, 
    intelligence, surveillance, and reconnaissance capabilities that in 
    their technical characteristics are superior in capability to those 
    of such other individual or possible coalition of states or non-
    state actors.''.
    (e) Definitions.--In this section:
        (1) Appropriate congressional committees.--The term 
    ``appropriate congressional committees'' means the Committee on 
    Foreign Affairs of the House of Representatives and the Committee 
    on Foreign Relations of the Senate.
        (2) Qualitative military edge.--The term ``qualitative military 
    edge'' has the meaning given the term in section 36(h) of the Arms 
    Export Control Act, as added by subsection (d) of this section.
    SEC. 202. IMPLEMENTATION OF MEMORANDUM OF UNDERSTANDING WITH 
      ISRAEL.
    (a) In General.--Of the amount made available for fiscal year 2009 
for assistance under the program authorized by section 23 of the Arms 
Export Control Act (22 U.S.C. 2763) (commonly referred to as the 
``Foreign Military Financing Program''), the amount specified in 
subsection (b) is authorized to be made available on a grant basis for 
Israel.
    (b) Computation of Amount.--The amount referred to in subsection 
(a) is the amount equal to--
        (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 assistance 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, including research and 
    development.
        (2) Disbursement of funds.--Amounts authorized 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. 203. SECURITY COOPERATION WITH THE REPUBLIC OF KOREA.
    (a) Findings.--Congress makes the following findings:
        (1) Close and continuing defense cooperation between the United 
    States and the Republic of Korea continues to be in the national 
    security interest of the United States.
        (2) The Republic of Korea was designated a major non-NATO ally 
    in 1987, the first such designation.
        (3) The Republic of Korea has been a major purchaser of United 
    States defense articles and services through the Foreign Military 
    Sales (FMS) program, totaling $6,900,000,000 in deliveries over the 
    last 10 years.
        (4) Purchases of United States defense articles, services, and 
    major defense equipment facilitate and increase the 
    interoperability of Republic of Korea military forces with the 
    United States Armed Forces.
        (5) Congress has previously enacted important, special defense 
    cooperation arrangements for the Republic of Korea, as in the Act 
    entitled ``An Act to authorize the transfer of items in the War 
    Reserves Stockpile for Allies, Korea'', approved December 30, 2005 
    (Public Law 109-159; 119 Stat. 2955), which authorized the 
    President, notwithstanding section 514 of the Foreign Assistance 
    Act of 1961 (22 U.S.C. 2321h), to transfer to the Republic of Korea 
    certain defense items to be included in a war reserve stockpile for 
    that country.
        (6) Enhanced support for defense cooperation with the Republic 
    of Korea is important to the national security of the United 
    States, including through creation of a status in law for the 
    Republic of Korea similar to the countries in the North Atlantic 
    Treaty Organization, Japan, Australia, and New Zealand, with 
    respect to consideration by Congress of foreign military sales to 
    the Republic of Korea.
    (b) Special Foreign Military Sales Status for Republic of Korea.--
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), 36(c), 36(d)(2)(A), 62(c)(1), and 63(a)(2), by 
    inserting ``the Republic of Korea,'' before ``or New Zealand'' each 
    place it appears;
        (2) in section 3(b)(2), by inserting ``the Government of the 
    Republic of Korea,'' before ``or the Government of New Zealand'';
        (3) in section 21(h)(1)(A), by inserting ``the Republic of 
    Korea,'' before ``or Israel''; and
        (4) in section 21(h)(2), by striking ``or to any member 
    government of that Organization if that Organization or member 
    government'' and inserting ``, to any member government of that 
    Organization, or to the Governments of the Republic of Korea, 
    Australia, New Zealand, Japan, or Israel if that Organization, 
    member government, or the Governments of the Republic of Korea, 
    Australia, New Zealand, Japan, or Israel''.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.

Summary: Title I: Naval Vessel Transfer - Naval Vessel Transfer Act of 2008 - (Sec. 102) Authorizes the President to transfer on a grant basis to: (1) Pakistan, the OLIVER HAZARD PERRY class guided missile frigate MCINERNEY; (2) Chile, the KAISER class oiler ANDREW J. HIGGINS; and (3) Peru, the NEWPORT class amphibious tank landing ships FRESNO and RACINE. States that: (1) the value of such vessels transferred on a grant basis shall not be counted against the aggregate value of excess defense articles transferred to countries in any fiscal year under the Foreign Assistance Act of 1961; (2) transfer costs shall be charged to the recipient; and (3) to the maximum extent practicable, the country to which a vessel is transferred shall have necessary vessel repair and refurbishment carried out at U.S. shipyards (including U.S. Navy shipyards).

Terminates transfer authority two years after enactment of this Act.

Title II: United States Arms Exports - (Sec. 201) Directs the President to: (1) carry out an ongoing assessment of the extent to which Israel possesses a qualitative military edge (as defined by this Act) over military threats; (2) use such assessment in reviewing applications to sell defense articles and services under the Arms Export Control Act to a Middle Eastern country other than Israel; and (3) submit an initial report on such assessment to the appropriate congressional committees by June 30, 2009, and then every four years thereafter.

Amends the Arms Export Control Act to require any certification relating to a proposed sale or export of defense articles or services to a Middle Eastern country other than Israel to include a determination that such sale or export will not adversely affect Israel's qualitative military edge (as defined by this Act for purposes of this provision) over military threats.

(Sec. 202) Makes specified foreign military financing program funds for FY2009 available on a grant basis for Israel.

Authorizes funding in FY2009 for the procurement of advanced weapons systems, including research and development, by Israel.

(Sec. 203) Amends the Arms Export Control Act to provide the Republic of Korea with special foreign military sales status, including expedited congressional review for export of U.S. defense items and services.