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What is the Special Defense Acquisition Fund in Foreign Military Sales?

Updated 26 September 2026Checked against the SAMM: 11 September 2026

The is a that buys defense articles and services before any partner has asked for them, so they can be delivered faster than a new procurement allows. decides what the fund buys and which partner gets it; the partner buys the item on a , and the proceeds go back into the fund.

What is the Special Defense Acquisition Fund?

The , authorized in Section 51 of the , 22 U.S.C. 2795, was created to address the issue of long lead times. The is a financially independent, that finances the procurement of defense articles and defense services in anticipation of future transfer to foreign countries and international organizations. The itself is a procurement authority, not a transfer authority. All assets are transferred to partners using the same laws, regulations, and rules that govern all foreign military transfers.

The provides both procurement authority and funds availability to engage in procurement actions prior to or pseudo- implementation. The allows the to deliver selected articles and services to partners in less than normal procurement lead-time, and it enhances U.S. force readiness by reducing the need to divert assets from U.S. forces when partners have urgent requirements that cannot otherwise be satisfied.

The is capitalized using selected receipts on sales, as provided in Section 51(b) of the .

When -purchased assets are transferred to a foreign government or international organization, the proceeds from the transaction are reimbursed to the and used to finance subsequent purchases.

DoW components identify the items or services proposed for procurement using the funds.

, in consultation with the Department of State, Bureau of Political-Military Affairs, selects the defense articles and defense services to be purchased by the . The defense articles and services approved for procurement are included in a spend plan that is provided to the congressional committees that oversee the authority.

The implementing agencies () execute the purchases of approved items. procurements are made in accordance with DoW regulations and procedures, as outlined in the and .

The are responsible for storing and maintaining accountability of defense articles purchased by the until the items are transferred to a foreign government, international organization, or Building Partner Capacity program. In addition, the must establish controls to ensure assets are not transferred to an international partner or used by the unless explicitly approved by .

An approved allocation request authorizes the to offer the requested item or service to a foreign government, international organization, or Building Partner Capacity program.

The allocation process begins when an eligible foreign country, international organization, or Building Partner Capacity program requests information on defense articles and/or services, and the articles and/or services are available in the inventory. When such a request is received, the should verify the availability of the requested asset and then submit an allocation request to .

-procured assets are allocated in accordance with the laws, regulations, and policies that apply to all and transfers. The allocation of an asset to support an eligible foreign country, international organization, or Building Partner Capacity program must be approved by before it can be added to an .

Generally, sales are made from assets in the inventory. In instances where the article or service requested has been purchased by the but not yet delivered to the , the international partner may purchase the equity that the owns in the acquisition contract.

assets may be offered on a separate or as one or more separate lines on an that includes articles and services that will not be sourced from the inventory. Sub-lines will not mix and non- material and services. Once a case is offered, the assets on the case will be held in reserve until the expires.

The payment for defense articles and services sourced from the must be included in the .

References

Drawn exclusively from publicly available authorities.

SAMM

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