Summary: Pursuant to a congressional request, GAO reviewed the Department of Commerce's and the Department of Defense's (DOD) roles in the export licensing process for commercial products which could also have a military use.
GAO found that: (1) Commerce and DOD agreed on 90 percent of 10,380 licensing actions for cases completed between June 1987 and June 1988; (2) Commerce followed DOD recommendations to conditionally approve some licensing actions; (3) Commerce denied 71 cases that DOD approved, based on its concerns about diversion or the Department of Energy's concerns about unacceptable nuclear uses; (4) DOD recommendations caused Commerce to change 36 percent of its initial licensing decisions or to place certain restrictions on 36 percent of proposed exports to Soviet bloc countries and China; (5) DOD recommendations on proposed exports to free-world countries had little influence on Commerce's licensing decisions; (6) Commerce applied conditions prohibiting reexport, resale, or transfer in 43 of the 66 free-world cases reviewed, although those conditions restated regulatory requirements or commitments the consignee made during export application; (7) DOD did not consistently consider the reexport prohibition condition necessary, while Commerce did not consistently apply the reexport prohibition condition; (8) Commerce's Bureau of Export Administration had a fiscal year (FY) 1988 budget of $37.47 million and 602 licensing-related staff and referred 10,804 of the 97,450 licensing applications it received during FY 1988 to DOD; and (9) the DOD Defense Technology Security Administration had a FY 1988 budget of $9.78 million and 166 licensing-related staff.
