On September 10, 2005, President Vladimir Putin signed Decree 1062, Issues of Military-Technical Cooperation between the Russian Federation and Foreign Countries. This decree is a new draft of Decree 1953 of December 1, 2000, which bore the same name and was previously in force.
The need for a new draft of the document was dictated partly by the completion of structural reorganisation of the Russian executive power system and partly by the need to take into account experience gathered in the area of military-technical cooperation, including the proposals made by the Commission for Military-Technical Cooperation, in particular in its decisions of February 18, 2005.
In this respect, the decree sets out concrete measures for eliminating factors hindering rapidity and flexibility in the area of supplying military-purpose goods, above all doing away with the excess number of stages of approval in the decision-making process. At the same time, the decree reinforces to a certain extent the state’s control and coordinating functions with regard to the activities of the participants in military-technical cooperation.
Overall, the innovations contained in the newly signed decree are designed to make the Russian arms market more appealing to foreign partners and raise the authority of Russian suppliers.
The decree considerably expands the content and substance of military-technical cooperation and sets out concrete examples of potential areas of activity in this area.
It also clarifies the question of division of powers between the Russian Federation Government and the Federal Service for Military-Technical Cooperation (FSMTC) in making decisions on imports and exports of military-purpose goods, provision of upgrade and modernisation services and training for national military and technical personnel.
The decree considerably simplifies military-purpose goods procurement procedures, as part of state defence procurement, for the executive federal bodies that maintain troops and military formations.
The need has been recognised for clear procedures for controlling foreign countries’ compliance with their commitments on using Russian military-purpose goods supplied to them for their designated purpose.
The decree also sets out a control mechanism by which the FSMTC can ensure that the conditions of contracts concluded by the participants in military-technical cooperation are legally valid, conform to the legislation in force and correspond to Russia’s military-political and economic interests.
The decree also activates the process for examining requests from foreign clients and the approval of draft decisions on deliveries of military-purpose goods.
The decree defines the working algorithms for draft decisions on military-technical cooperation areas such as imports of military-purpose goods and the creation of joint ventures for their development, production, maintenance, modernisation and destruction (recycling and processing).
The introduction of a notification system in some cases will make it to possible to reduce the time it takes get federal executive approval for the aforementioned draft decisions.
The decree simplifies the procedure for obtaining and renewing the right to carry out foreign trade activity involving military-purpose goods and redistributes certain powers in this area.
Alongside the Russian Cabinet, the FSMTC also now examines cases regarding granting organisations the right to carry out foreign trade activity involving military-purpose goods.
The list of cases in which the FSMTC, empowered by the Russian President, can grant the right to carry out foreign trade activity involving military-purpose goods has been expanded. In accordance with the new decree, this right can be provided in the case of supplies of spare parts, units, assemblies, instruments, component items, special, training and auxiliary goods, technical documentation for earlier deliveries of military-purpose goods, provision of inspection and calibration work, provision of work on service life extension, technical maintenance, repairs, recycling and other work part of comprehensive maintenance service for earlier deliveries of military-purpose goods, and also training for foreign experts in carrying out the aforementioned work.
A reduction in the list of documents to be provided and the number of organisations whose approval is required makes it possible to simplify the following procedures:
The procedure for granting organisations the right to carry out foreign trade activity involving military-purpose goods;
The procedure for amending the nomenclature (list) of military-purpose goods for which an organisation has the right to carry out foreign trade activity;
The procedure for granting the aforementioned right to the successor organisation of an organisation that is a participant in military-technical cooperation and undergoes reorganisation.
The new decree provides for the possibility of an organisation completing its contractual commitments after the expiry of its right to carry out foreign trade activities involving military-purpose goods, and also the possibility for an organisation to transfer unfulfilled commitments to other participants in military-technical cooperation in the event that it loses the right to continue its activities in this area or that it fails to gain an extension of this right.
These innovations are designed to ensure stable relations between the Russian participants in military-technical cooperation and their foreign partners.
In the objective of developing the procedures previously in force, the decree considerably optimises procedures in the following way:
Narrows the list of issues regarding applications for a licence that require Russian Defence Ministry approval and reduces the list of required documents;
Reduces the time it takes to obtain Russian Defence Ministry approval by introducing a notification system;
Abolishes, in a number of cases, the need to obtain Russian Defence Ministry approval for applications for the import and export of military-purpose goods that are to be exhibited and demonstrated at international exhibitions.
Furthermore, the decree considerably simplifies the licensing procedure for additional deliveries of military-purpose goods (the import and export of spare parts, units, assemblies, instruments, component items, special, training and auxiliary material, technical documentation, provision of inspection, calibration, service life extension, technical maintenance, repair, recycling and processing work and training for foreign experts).
The decree designates the federal executive bodies responsible for coordination and control in the area of military-technical cooperation between the Russian Federation and foreign countries and also for settling other matters of state regulation in this area. It also makes some adjustments to the powers of the aforementioned bodies in this area.
Overall, this new decree aims at ensuring ongoing development and improvement of the actively functioning system of military-technical cooperation between Russia and foreign countries and will contribute to raising the state’s effectiveness in this area of international relations.
The Russian President has also approved a list of organisations – designers and manufacturers of military-purpose goods – to which the FSMTC is empowered to grant, according to the established procedure, the right to carry out foreign trade activity involving military-purpose goods.