SPAIN: PM/DTTC COUNTRY BRIEFING ON THE BLUE

UNCLAS MADRID 000625 SIPDIS SENSITIVE FOR EUR/WE AND PM/DTTC E.O. 12958: N/A TAGS: PREL KOMC ETTC SP SUBJECT: SPAIN: PM/DTTC COUNTRY BRIEFING ON THE BLUE LANTERN PROGRAM ¶1. (SBU) Summary: A team from the Directorate of Defense Trade Controls (PM/DTTC) provided a background briefing February 10 on the Blue Lantern Program to an official from the Spanish Ministry of Defense's (MOD) Technology Transfers and Transactions Unit and mission's Commercial Service Office (USCS) and the Office of Defense Cooperation (ODC). The Spanish representative said the MOD was willing to continue close cooperation on the Blue Lantern Program. Overall, the briefing underscored the USG's interest in working with the Spanish MOD to help disrupt international gray arms trade networks through closer cooperation on the Blue Lantern program. End Summary. ¶2. (SBU) PM/DTTC office experts Peter Maxwell and C. Edward Peartree briefed Spanish Army Captain Juan Martinez Martinez of the MOD'S Technology Transfer and Transactions Unit, along with poloffs and officers from the ODC and the USCS on the Blue Lantern program. The briefing covered DTTC's structure and legal authority; the goals, methods, and outcomes of the Blue Lantern Program; and the nature of the gray arms market. The team noted that only 9% of the 93 unfavorable Blue Lantern cases reported in FY 2004 involved European end users, and 33% of them involved European intermediary companies. ¶3. (SBU) In response to DTTC's presentation, Martinez said that the MOD was interested in continuing its close cooperation with the U.S. on the Blue Lantern program. The MOD used several end-user licensing mechanisms to stop gray arms transfers through Spain. He noted that all valid end-user licenses are approved by the director general of the MOD's Office of Armament and Material and substitute a Spanish certificate for Section 8 Certification of Foreign Government on the DSP-83 Nontransfer and Use Certificate form. Spanish end-user licenses are valid for six months and require end-users report the delivery the defense items listed on their licenses within one month of their arrival in country. Martinez said the Spanish Congress recently approved legislation requiring the Spanish Customs Service to report to the MOD all commercial transfers of military items to Spain. Martinez also said the Technology Transfer and Transactions Unit also employs a quality assurance inspector to verify end-users' bona fides. ¶4. (SBU) Comment: The DTTC presentation broadened the Spanish Ministry of Defense's and mission's understanding of the goals, methods, and results of the Blue Lantern program. Most importantly for the Spanish, it made clear that Blue Lantern program is not an enforcement exercise but rather a collaborative process based on mutual trust between the U.S. and Spain. We expect continued strong cooperation from the MOD in our efforts to disrupt the diversion of U.S. defense materials to gray arms networks through fraudulent arms dealers in Spain. MANZANARES