What is coproduction of U.S. defense articles?

Foreign governments often seek to domestically produce part or all of a U.S. defense system to satisfy their own domestic defense industry development goals. There are three distinct methods of authorizing foreign production of defense articles.

First, cooperative production is conducted with international partners under a cooperative international agreement and features an allocation of production responsibilities amongst the international partners. Individual international partners will be designated as the manufacturer of certain system components. The designated manufacturer will produce the respective components for the entire production quantity of the system. As such, the designated manufacturer will not only produce components for its own nation but also components for all international partners. Final assembly can be conducted by one or more of the partners. Most cooperative production programs naturally evolve from cooperative development phase partnerships. The F-35 JSF program is using cooperative production.

Second, FMS coproduction involves the use of FMS procedures and commercial licenses to provide a foreign nation the ability to produce U.S.-origin defense articles. Coproduction capabilities may be transferred solely through FMS LOAs, may involve a combination of FMS LOAs and associated munitions export licenses, or may require development of a coproduction international agreement. FMS coproduction agreements are discussed in SAMM C4.4.5.

Third, licensed coproduction involves use of commercial munitions export licenses issued by the Department of State (DOS). Licenses that authorize the export of manufacturing technical data are referred to as Manufacturing Licensing Agreements (MLAs). Licensed production enables U.S. companies to transfer to foreign governments or foreign companies the ability to produce U.S. origin defense articles. It should be noted that the U.S. defense articles proposed for licensed coproduction may not even be in DoW use, or may be a significantly modified version of DoW equipment. The Defense Technology Security Administration (DTSA), in concert with the other DoW components, agencies, and the OSD staff, plays a leading role in formulating the DoW’s position with regard to U.S. industry-licensed coproduction proposals.