The Defense Department, in a bid to increase its control over the flow of high technology into eastern bloc nations, is seeking new powers to review export licenses by American companies wanting to sell sensitive technology anywhere in the world.
In effect, the Defense Department is seeking veto power over the export of sensitive technology to neutral and allied countries to prevent any diversion of that technology to the communist bloc.
The strategic commodities involved include computers, lasers, semiconductors and semiconductor fabrication technology. Currently, the Pentagon is authorized to monitor only the direct sale of such technologies to the Soviet Union, other eastern bloc countries and the People's Republic of China.
"We would like to be in the loop in potentially risky areas for two reasons," says a senior Defense Department official. "One is to know where the technology leaks are coming from. That would be helpful because we have some leverage with local defense ministries. The other is to help us better understand where things are going in the open market. We want to know where the technology is headed."
High technology export licenses to countries outside the communist bloc are processed by the Commerce Department, which doesn't want Pentagon oversight on day-to-day processing of export licenses, administration officials say.
The technologies are checked against a list of so-called "strategic commodities" that the Pentagon helps compile before the license is approved or rejected.
According to the Department of Commerce, Defense now reviews roughly a third of the approximately 8,000 foreign export applications to communist bloc countries. License applications to the free world numbered 63,889 in 1981, and the Defense Department's move could quintuple the applications under its review, according to one expert.
The Pentagon now tracks the sales of high technology into the eastern bloc through Cocom (Coordinating Committee), a NATO group that assesses what technologies are or are not critical for strategic superiority prior to export. According to a senior Defense official, the Pentagon is trying to "figure out a way to plug in more military input" into the Cocom evaluation process. Cocom is currently meeting in Paris as part of its triannual review of export guidelines.
A Commerce Department official said yesterday that the 1974 Jackson Amendment restricts the Pentagon to direct review of high technology sales to the communist bloc. However, in discussions with Commerce, the Defense Department contends that the amendment does give it free-world license oversight. Richard Perle, who is now the assistant secretary of Defense for national security and architect of the Pentagon's technology transfer policy, drafted the Jackson Amendment when an aide to the Washington senator in 1974.
" Defense has asked to see commodities in some sensitive areas," says Lawrence Brady, assistant secretary of Commerce for trade administration, "Defense has a legitimate role in the licensing effort." However, said Brady, the precise nature of that role has not yet been negotiated.
"There are some low-level people in the Department of Defense who would like to have the entire export control system moved over there," said a senior Commerce Department official.
The issue has been complicated by a bill reported last week by the House Foreign Relations subcommittee on international economic policy and trade that weakens the tougher export controls on sensitive technologies, sought by President Reagan, in amendments to the Export Administration Act. This measure, say both Defense and Commerce sources, only "exacerbates the interagency rivalry" for exports jurisdiction.
There are serious concerns that injecting the Defense Department into the review process for free-world exports would create additional delays for American companies seeking international markets.
"This proposal would, when implemented, adversely affect the international competitivenes of U.S. high technology firms without commensurate improvement of our national security," contends Donald Weadon, an international lawyer for several high technology companies. "Imposing an additional review layer, no matter how efficient, will increase the already serious delays in free world license approvals."
A Defense Department official said he did not expect the Pentagon's participation in the review process to create additional delays.