International Procurement: NATO Allies' Implementation of Reciprocal Defense Agreements
NSIAD-92-126
Published: Mar 18, 1992. Publicly Released: Mar 18, 1992.
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Highlights
Pursuant to a congressional request and a legislative requirement, GAO reviewed how various North Atlantic Treaty Organization (NATO) countries were implementing their reciprocal defense procurement memoranda of understanding (MOU) with the United States, focusing on: (1) how the United States and its allies viewed and implemented MOU; (2) whether MOU provide opportunities for U.S. firms to freely and fairly compete in allied defense markets; (3) the extent to which allied governments' tariff practices affected contract selections; (4) allied contract award grievance procedures; and (5) the Department of Defense's (DOD) efforts to monitor MOU.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should request that the foreign signatories of procurement annexes provide specific information demonstrating how they are implementing all the provisions of these annexes. Furthermore, in future annexes, mutually agreed upon language should be included that would enable both governments to periodically review progress made in implementing the provisions of the annexes. | DOD is obtaining documented information on the procurement rules and procedures of the five countries that have signed procurement annexes: France, Germany, Italy, the Netherlands, and Norway. DOD has completed documentation on France and Norway to date. DOD obtained information on procurement rules and procedures of France and Norway. However, it does not intend to obtain information on Germany, Italy, and the Netherlands because the Department of Commerce has a similar effort ongoing worldwide. DOD's Office of Foreign Contracting believes it implements the spirit of the recommendations in its periodic meetings with the MOU countries and in tracking defense trade between these countries... and the United States. Nevertheless, theses and Commerce's efforts do not appear to clearly fulfill the intent of the recommendations, since they do not include evaluation of the countries' defense procurement rules and procedures and actions to ensure they are implementing all the annex provisions.
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| Department of Defense | The Secretary of Defense should strongly encourage MOU signatories to promote greater reciprocal defense market access by designating ombudsmen to assist U.S. contractors. These ombudsmen should provide services similar to those provided by the DOD ombudsman. |
14 MOU countries have designated ombudsmen. Responses have not yet been received from five countries. One country declined to designate an ombudsman.
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Defense industryDefense procurementFederal procurement policyForeign governmentsForeign military assistanceForeign military sales agreementsInternational agreementsInternational economic relationsTariffsGrievance procedures