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Appendix C: Previous Studies
Pages 193-202

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From page 193...
... ICs incorporated in its weapon systems and other key mission products that require trusted sources and how many such circuits are needed. This requires that DOD identify device and technology types of microelectronics devices that require trusted sources as well as the length of time it will need such special supply arrangements.
From page 194...
... (2004) The following is reprinted from Office of the Secretary of Defense, Foreign Sources of Supply: Assessment of the United States Defense Industrial Base: Report Required by Section 812 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136)
From page 195...
... The January 2004, DoD report Study on Impact of Foreign Sourcing of Systems examined the extent and implications of foreign subcontractors for twelve operationally important defense systems. The report concluded that foreign suppliers provide limited amounts of materiel for the systems; and that using those foreign subcontractors does not impact long-term military readiness or the economic viability of the national technology and industrial base.
From page 196...
... Utilization of these foreign sources does not impact the economic viability of the national tech­nology and industrial base. The national technology and industrial base is not put at risk by the use of the foreign suppliers reflected within this study.
From page 197...
... , generally, prime contractors and first and second tier suppliers indicated they selected foreign subcontractors for specific items because those subcontractors offered the best combination of price, performance, and delivery. The results of this study are consistent with recent related studies.
From page 198...
... industry collaboration with one country's firm increasingly means collaboration with many countries' firms. The consolidation that is taking place both with the European defense aerospace industry and with that of other important foreign industrial bases has made it increasingly prob lematic for U.S.
From page 199...
... If new, mutually benefi cial cross-border collaborative business relationships take hold, the consolidation of European and other foreign industries greatly increases the prospects for allied procurement of standardized or interoperable systems while potentially reducing system costs. On the other hand, the persistence of frictions over technology transfer and security issues as well as foreign direct investment, combined with the increased capabilities and competitiveness of European and other multinational defense industries, means that the Europeans and other allies may be tempted to move increasingly toward indigenous solutions and more widespread global competition with U.S.
From page 200...
... Moreover, military capability is created when widely available and/or defense-unique technologies are integrated into a defense system. Accordingly, DoD should give highest priority in its technology security efforts to technology integration capabilities and the resulting military capabilities themselves, and accordingly lower priority to the individual technologies of which they are comprised.
From page 201...
... These include insufficient clarity in DoD policy on cross-border defense industrial mergers and acquisi tions, and an overly burdensome regulatory environment surrounding both foreign direct investment in the U.S. defense sector and the transfer of U.S.
From page 202...
... 202 Nanophotonics The Task Force also recommends that DoD adapt existing bilateral industrial security arrangements to respond to the emergence of multinational foreign defense industrial organizations. The change in the structure of the defense industry raises a question about whether the existing security practices are appropriate to its inevitable globalization.


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