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A direct commercial sale requires an export license, which is issued by the Office of Defense Trade Controls at the State Department's Bureau for Political-Military Affairs. Policy staff regularly meets with key policy stakeholders, and manages Congressional interaction with NDIA Chapters and Divisions. The Vendor negotiates with the Customer. U.S. DOD – U.S. DOD refers to any U.S. military office. These organizations are driving the future of defense through education, access, and collaboration. Like the FMS program, DCS advances interoperability between the U.S military and its allies. Foreign Military Sales Versus Direct Commercial Sales [Metin Gultekin] on tel: (703) 522-1820, Chemical Biological Defense Acquisition Initiatives Forum, Industrial Committee of Ammunition Producers, Industrial Committee on Test and Evaluation, Trusted Microelectronics Joint Working Group, ADAPT - Agile Delivery for Agencies, Programs and Teams. What differentiates Direct Commercial Sales (DCS)? Eligible Countries c. Eligible Contractors d. Eligible Items i. This chart explains the main differences between Foreign Military Sales (FMS) and Direct Commercial Sales (DCS). The NDIA Policy team monitors, advocates for, and educates government stakeholders on, policy matters of importance to the defense industrial base. DCS means that the U.S. defense company (the vendor) works directly with the foreign government customer to negotiate, finalize, and deliver a sale. While FMS cases must have departmental approval, they are exempt from the export licensing process. Direct Commercial. The US DOD assumes contracting risk and is responsible for ensuring that the Vendor meets cost, schedule, and performance requirements. A Comparison of Foreign Military Sales FMS Versus Direct Commercial Sales DCS Back A Comparison of Foreign Military Sales (FMS) Versus Direct Commercial Sales (DCS) September 30, 2014, Co-Author with the General Counsel for the Defense Security Cooperation Agency. U.S. Government (USG) is not involved in the transaction, and does not act on behalf of the Customer or Vendor should complications arise. A September 2016 White House approval of the sale of fighter jets to the Middle East illustrates the impact that FMS has on the U.S. economy, while concurrently serving U.S. national security interests. For this reason, the United States takes into account political, military, economic, arms control, and human rights conditions in determining the provision of military equipment and the licensing of direct commercial sales to any country. A key difference between Foreign Military Sales (FMS) and Direct Commercial Sales (DCS) is that: Unlike FMS, with DCS the purchaser must communicate with the US Government . The Apache sale is a hybrid procurement—Direct Commercial Sale (DCS) between Boeing and MoD and Foreign Military Sale (FMS) between government of India and the US government. Through the Foreign Military Sales process, the U.S. government serves as a go-between for foreign partners and American industry. © 2020 National Defense Industrial Association. U.S. Government’s Foreign Military Sales (“ FMS ”) program and similar mechanisms, and Direct Commercial Sales (“ DCS ”) negotiated directly between the contractor and the foreign customer. Both are viable options for U.S. defense companies seeking to do business overseas. A sale of defense articles or defense services made under a Department of State issued license by U.S. industry directly to a foreign buyer, and which is not administered by DoD through FMS procedures. Congress must be notified by the State Department of a decision to issue an export license if the sale includes significant defense equipment valued at $14 million or more. As Fiscal Year (FY) 2017 comes to a close, FMS sales total roughly $64 billion, surpassing the previous record of $67.8 billion in total sales in FY 2012. If FMF funds are available, they must be processed through FMS (except for the ten countries granted an exception). Furthermore, foreign countries use FMF funding to purchase U.S. defense products and systems through both the FMS program and, on occasion, the DCS process., LMDefense | 703-200-2409 | About | Contact, Our consulting services can help you determine whether FMS or DCS is right for your company! Use on contracts for foreign military sales shall be on a rent-free basis. The Customer assumes management responsibility. NDIA Affiliates are subsidiary organizations that focus on specific areas and missions related to it's community of interest. NDIA provides a platform through which leaders in government, industry and academia can collaborate and provide solutions to advance the national security and defense needs of the nation. This effort has provided legislative recommendations to assist Congressional acquisition reform efforts, many of which were enacted or influenced final provisions in the Fiscal Year 2016 and Fiscal Year 2017 National Defense Authorization Acts.

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