Missile Technology Control Regime

Missile Technology Control Regime (MTCR)

Summary:

The Missile Technology Control Regime (MTCR) is a set of guidelines regulating the export of missiles, unmanned air vehicles (UAVs), and related technology for those systems capable of carrying a 500 kilogram payload at least 300 kilometers, as well as systems intended for the delivery of weapons of mass destruction (WMD). The MTCR was formed in 1987 by the G-7 partners, and is an informal voluntary arrangement, not a treaty or an international agreement. The MTCR consists of common export policy applied to a common list of controlled items. Each member implements its commitments in the context of its own national export laws. In addition to the MTCR's members, a number of countries unilaterally observe -- or "adhere to"-- the Guidelines.

The MTCR considers "missiles" to include: ballistic missiles, space launch vehicles (SLVs) and sounding rockets. UAVs include: cruise missiles, drones, and remotely piloted vehicles (RPVs). The MTCR Guidelines specifically state that the Regime is "not designed to impede national space programs or international cooperation in such programs as long as such programs could not contribute to delivery systems for weapons of mass destruction." The MTCR was originally concerned only with nuclear capable delivery systems. In January 1993, the Partners extended the guidelines to cover delivery systems capable of delivering all WMD (nuclear, chemical, and biological).

The MTCR's annex of controlled equipment and technology is divided into "Category I" and "Category II" items. It includes equipment and technology, both military and dual-use, that are relevant to missile development, production, and operation. According to the Guidelines, export of Category I items is subject to a presumption of export denial. Category I includes complete rocket systems, unmanned air-vehicle systems such as cruise missiles, target and reconnaissance drones, specially-designed production facilities for these systems; and certain complete subsystems. Category II covers a wide range of parts, components and subsystems such as propellants, structural materials, test equipment and facilities, and flight instruments. These items may be exported at the discretion of the MTCR Partner government, on a case by case basis, for acceptable end-uses. They may also be exported under government-to-government assurances, which provide that they not be used on a missile system capable of delivering a 500 kilogram payload to a range of at least 300 kilometers.

Greater Specifications on Payload and Range for Cruise Missiles Made to MTCR

During the August 2002 meeting in Warsaw, parties to the MTCR decided on greater clarity in the definitions of "range" and "payload." Members agreed that the current range of 300 kilometers would be the distance achieved at "range maximizing" capability. The definition of payload was expanded to include the cover support structures and countermeasures. The new definitions were in response to a controversy over the ambiguity of both range and payload during the late 1990's. At that time, the United Kingdom and France sold Black Shaheen cruise missiles, which have a maximum capable range of 500 kilometers, to the United Arab Emirates. Both countries, which are members, argued that the sale was not in violation because the missiles' range was below 300 kilometers when flying at sea level. [Make Nartker, "International Response: MTCR Changes Address Cruise Missile Proliferation," Global Security Newswire, 28 October 2002]

For more in-depth information, please consult the Inventory of Nonproliferation Organizations and Regimes, which can be found on the CNS website at: http://cns.miis.edu/pubs/.

China and the MTCR:

China has until now not been a member of the MTCR but did agree in 1991 to abide by the MTCR's original 1987 Guidelines and Parameters. China originally pledged (verbally) that it would adhere to the Guidelines and Parameters of the MTCR during negotiations between Secretary of State James Baker and Foreign Minister Qian Qichen in November 1991 and it later included those verbal assurances in a February 1992 letter to the Bush Administration. (The letter is currently classified.) China further clarified the nature of its adherence to the MTCR in a October 1994 joint statement with the United States In that document, China made two key commitments. First, China agreed to completely ban the export of ground-to-ground missiles; this pledge goes beyond the MTCR's requirements which only call for a "strong presumption of denial" for such exports. Second, China agreed to the concept of "inherent capability," which states that "the missile would be included in the ban if it could generate sufficient energy to deliver a 500 kg payload at least 300 km, regardless of its demonstrated or advertised combination of range and payload." This second commitment from China is especially important because it was aimed at preventing the export of missiles that could violate the MTCR if their range and payload were adjusted. For example, China argued in the past that its M-11 missile exports to Pakistan did not violate the MTCR because the range and payload of the missile (290km/800kg) do not strictly meet the MTCR parameters of 300km/500kg. Furthermore, in a 29 October 1997 joint statement, the United States and China stated that both sides agreed "to build on the 1994 Joint Statement on Missile Nonproliferation. They reaffirm their respective commitments to the guidelines and parameters of the Missile Technology Control Regime (MTCR)." Both of China's official pledges to abide by the MTCR (in 1991/1992 and in 1994) were presented to the United States in exchange for the lifting of U.S. sanctions.

China was not included in the original negotiations of the MTCR in the 1980s. As a result, China initially argued in the late 1980s and early 1990s that because it did not take part in the MTCR's formation that it should not be held to MTCR restrictions. These arguments were were used to deflect opposition to China's DF-3 sale to Saudi Arabia and its possible missile sales to Syria, Iran and Pakistan. China has in the past also criticized the regime for being discriminatory, for failing to restrict ground-attack aircraft (which China argues are equally capable delivery systems for WMD), and for interfering with the internal affairs of sovereign countries. For example, Chinese arms control researcher Liu Huaqiu argued in a November 1995 paper that:

"Ballistic missiles per se are not weapons of mass destruction, but rather a carrier vehicle. Likewise, fighter aircraft are also a carrier vehicle that can carry nuclear, biological, and chemical weapons...Limiting missile exports without limiting fighter plane exports is clearly a double standard." [Liu Huaqiu, Xiandai Junshi (Conmilit) (Beijing), 11 November 1995, in "Analysis Of Nuclear Arms Control Policy," FBIS-CHI-95-246, 11 November 1995.] The United States and other members of the MTCR have opposed Chinese participation in the process of drafting the guidelines due to their concern that China may get access to sensitive missile design information.

China further explained its official position on the MTCR in its July 1998 "white paper" called China's National Defense. It explained:

"China has been consistently cautious and responsible regarding the transfer of missiles. China is not a member state of the Missile Technology Control Regime (MTCR) and has not joined its formulation and revision, but, in accordance with China's consistent position on non-proliferation and its principles concerning arms exports, the Chinese government promised to observe the then guidelines and parameters of the MTCR in February 1992. In October 1994, China reaffirmed its promise and undertook the obligation of not exporting ground-to-ground missiles inherently capable of reaching a range of at least 300 kilometers with a payload of at least 500 kilograms. In line with the above policy, China has exercised strict and effective control over the export of missiles and related materials and has never done anything in violation of its commitments."

In September 2003, Foreign Minister Li Zhaoxing clearly indicated to the chair of the MTCR that China was ready to positively consider membership in the MTCR. This follows the strengthening of Chinese national export controls earlier in 2002 that brought them reasonably in line with current MTCR guidelines. In a statement at the Plenary for the 2004 session of the Conference for Disarmament, Ambassador Hu Xiaodi announced the start of the first round of China-MTCR dialogues in Paris.

Chinese compliance with the MTCR:

US law requires that sanctions be placed on countries that export equipment or technology restricted by MTCR guidelines, and in June 1991 the United States imposed sanctions on China for allegedly exporting M-11 missile technology to Pakistan and planning to export M-9 missile technology to Syria. In November 1991, China for the first time gave verbal assurances to the United States that it would adhere to the MTCR guidelines, in return for which the United States lifted the sanctions. This deal was finalized in February 1992, when China gave written assurances that it would abide by the MTCR.

In August 1993, the United States again imposed sanctions on China for allegedly transferring M-11 missile technology to Pakistan. China responded by calling the sanctions groundless and threatening to scrap its promise to abide by MTCR guidelines. The impasse was broken in October 1994, when China and the United States issued a joint statement on missile proliferation, in which China agreed to ban all exports of MTCR-class missiles, and the US agreed to lift sanctions. China's 1994 commitment exceeds the "strong presumption of denial" principle contained in the MTCR Guidelines. China also agreed to the "inherent capability" principle in defining an MTCR-class missile.

In April 1997 testimony, Deputy Assistant Secretary of State Robert Einhorn stated that since the 1994 joint statement:

"At a minimum, the Chinese do not appear to interpret their responsibilities under the guidelines as restrictively as we do, or as other MTCR members do. (Although China states that it abides by the MTCR guidelines, it is not a member of the multilateral regime.) Moreover, as we have learned more about current Chinese procedures for controlling missile-related goods and services, we have become more skeptical about the ability of Beijing's control system to implement missile restraints effectively. We will continue to urge the Chinese to live up to their October 1994 commitment, to interpret that commitment meaningfully, and to put in place the control regulations and procedures that would enable them to fulfill it conscientiously. In addition, we will need to review the applicability of relevant provisions of U.S. law." [Testimony by Robert J. Einhorn, Deputy Assistant Secretary of State for Nonproliferation, Before the Subcommittee on International Security, Proliferation, and Federal Services, Senate Committee on Governmental Affairs, 10 April 1997.]

2000 Pledge

On 21 November 2000, the Chinese Foreign Ministry issued its most stringent and specific policy statement on missile nonproliferation to date. The Chinese government promised, for the first time, to issue export control laws covering missile technologies. In the past, Chinese officials have stated that its controls on missile exports were governed by internal documents and not public laws. The Chinese pledged that the new laws would include such regulations as license application and review, end-user certifications, and a "catch-all" clause. The Chinese statement did not, however, specifically reference the MTCR or its control list and the statement did not mention when China would issue the new export control law. Some experts argued that the latter elements represented a loop-hole in the accord. The Chinese government also denied that it engaged in illegitimate trade with either Iran or Pakistan. The China Daily reports Chinese Foreign Ministry spokesman, Sun Yuxi refuting US allegations that China supplied Iran and Pakistan with missiles. Sun denounced the allegations as "rumors with ulterior motives." Sun said the PRC had exercised strict control on the export of missile technologies. ["Spokesman Refutes U.S. Allegations over Missiles," The China Daily, 24 November 2000, p.1; "US Welcomes PRC New Commitment," The People's Daily, 22 November 2000, p. 4.] [Full Chinese Statement on Missile Nonproliferation, November 2000]

On the same day, the State Department announced that it was waiving sanctions on Chinese entities for the past sales of missile technologies to entities in Iran and Pakistan. These exports, which date back to 1992, violated the 1990 Missile Control Act which calls for sanctions on entities engaged in export of MTCR-controlled items. The sanctions were for the export of both MTCR category I and category II items. The US also pledged to resume discussions with China as soon as possible on extending the 1995 US-China Agreement on International Trade in Commercial Launch Services. Under this accord, US companies can export satellites to China for launch on Chinese rocket boosters. [State Department Statement on Chinese Missile Sanctions, November 2000]

Old Problems Arise

The November 2000 deal did not hold for very long. On 1 September 2001 the US government imposed economic sanctions on a Chinese company for shipping missile technology to Pakistan in violation of a bilateral agreement in November 2000 and US law. The US government said that the China Metallurgical Equipment Corporation in late 2000 and early 2001 shipped missile technology to Pakistan that would assist its Shaheen 1 and Shaheen 2 programs. The sanctions, under the 1990 Missile Control Act, ban US companies from doing business with the Chinese entity for two years. The Bush administration has also invoked a ban on new licenses for U.S. companies to put their satellites on Chinese rockets or transfer satellite technology. These transfers were subsequently confirmed in September CIA report on global proliferation developments. [Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 July Through 31 December 2000.]

The Chinese government vociferously denied a Chinese company had shipped proscribed missile technology to Pakistan. The Foreign Ministry spokesman said:

Over a period of time, the US has repeatedly alleged that MECC was engaged in missile proliferation activities according to its so-called "intelligence information". In-depth investigations by the Chinese side indicate that MECC has never engaged in any activities as alleged by the United States and the US allegation is groundless. However, the US side is bent on making the erroneous decision based on its wrong intelligence information, in disregard of the constructive position and the investigation results of the Chinese side. Such a US move is totally groundless and irresponsible, which the Chinese side can never accept. [PRC FM Spokesman Opposes US Sanctions Against China, Xinhua, September 5, 2001.]

The Foreign Ministry called for the US to immediately lift the sanctions. China threatened repercussions of the sanctions were not lifted. "China strongly urges the US side to immediately withdraw its wrong decision, so as to avoid any damage to Sino-US cooperation in non-proliferation. Otherwise, the US side should bear all the responsibilities for the consequences arising therefrom."

2002 Regulations

In the aftermath of the September 11th terrorist attacks, US-China relations showed signs of improvement. Beijing extended its support to the US-led campaign against global terrorism. However, the Bush administration continued to stress that the issue of nonproliferation and export control was essential to further improvements in bilateral relations. In an effort to resolve bilateral tension, in August 2002 Beijing announced new export control regulations and an expanded control list, fulfilling its November 2000 pledge to issue export control laws covering missile technologies. The announcement coincided with a visit by Deputy Secretary of State Richard Armitage to Beijing, and was seen as an aspect of preparations for President Jiang Zemin's upcoming visit to the US in October 2002.

The new regulations included both the MTCR's "presumption of denial" approach, end-user certifications, and a "catch-all" clause. The new regulations appeared to mark a realization in China's leadership of the dangers of the proliferation of WMD and their delivery systems to its own security, as well as an attempt to remove this issue as a barrier to bilateral cooperation.

The 2002 regulations and control list are comprehensive and closely follow the MTCR. The discrepancies with the MTCR were explained by senior Chinese diplomat Liu Jieyi as:

"If you compare the List with MTCR, you will find that the categorization is a bit different for the sake of easy administration. There are items not contained in MTCR in the List. So in this respect, this List covers a wider area than MTCR. Of course there is also a very limited number of MTCR items that are not in the list because they are not really that relevant, either because we don't have them, or they have never come into the picture, or because our experts do not know exactly what they are. "["Briefing by Mr. Liu Jieyi Director General of Arms Control and Disarmament Dept. MFA on the Promulgation of Regulations on Export Control of Missiles and Missile-related Items and Technologies and the Control List," Ministry of Foreign Affairs Website, 27 August 2002.]

Some discrepancies, however, may still allow for license-free export of some technologies that would be useful for countries to establish indigenous missile programs. The US response to the regulations was cautious, with many in the Bush administration taking a "wait-and-see" approach before making a final judgment as to whether Beijing had fully committed itself to comprehensive implementation of these regulations. In an example of this cautious attitude, State Department spokesman Richard Boucher stated that: "It is an important part to have the regulations in place, it is an equally important part to see that they are enforced."

On 9 May 2003, the U.S. expressed its dissatisfaction with China's implementation of its new export control regulations and control list by imposing sanctions on North China Industries Corporation (Norinco) for allegedly supplying missile technology to Iran. The sanctions barred all exports to the US by Norinco and its subsidiaries, and forbade any contracts between the company and US government agencies. The measure was expected to have more of an impact than previous sanctions; in 2002, Norinco exported an estimated $100 million worth of products to the US. [Guy Dinmore, "US Imposes New Sanctions on China," Financial Times, 22 May 2003.]

[Sources: Richard T. Cupitt, "Export Controls And The People's Republic Of China: Some Considerations," The Monitor: Nonproliferation, Demilitarization, and Arms Control, Center for International Trade and Security, University of Georgia, Fall 1995, p. 15; Robert Shuey and Shirley A. Kan, "Chinese Missile And Nuclear Proliferation: Issues For Congress," CRS Issue Brief, 16 November 1995, pp. 2-3; Harry Harding, "Cooperative Security in the Asia-Pacific Region," in Janne E. Nolan, ed., Global Engagement: Cooperation and Security in the 21st Century (Washington, DC: The Brookings Institution, 1994, p. 425; Philip P. Pan, "China Issues Rules On Missile Exports," Washington Post, 26 August 2002, p. 11; Phillip Saunders, Preliminary Analysis of Chinese Missile Technology Export Control List, 6 September 2002, http://cns.miis.edu/cns/projects/eanp/pubs/prc_msl.pdf; Jing-Dong Yuan, "Missile Export Controls Significant Step for Beijing," South China Morning Post (Op-Ed), 29 August 2002, http://cns.miis.edu/pubs/other/beijing.htm; "Briefing by Mr. Liu Jieyi Director General of Arms Control and Disarmament Dept. MFA on the Promulgation of Regulations on Export Control of Missiles and Missile-related Items and Technologies and the Control List," Ministry of Foreign Affairs Website, 27 August 2002.; "China tightens missile export rules," BBC News, http://news.bbc.co.uk/2/low/asia-pacific/2216361.stm]

Key statements and documents related to China and the MTCR:

For more on China and multilateral export control regimes, see:

[CHINA AND MULTILATERAL EXPORT CONTROL REGIMES]

[CHRONOLOGY OF MTCR-RELATED STATEMENTS AND DEVELOPMENTS]

[CHINA AND THE INTERNATIONAL CODE OF CONDUCT (ICOC)]

[TEXT OF THE INTERNATIONAL CODE OF CONDUCT (ICOC)]

For more on China's export controls, see:

[CHINA'S EXPORT CONTROLS]

[CHINA'S CONVENTIONAL ARMS AND MISSILE EXPORT CONTROLS]

For more on missile proliferation issues, see:

[CHINA'S MISSILE EXPORTS] (See especially [CHINA'S MISSILE EXPORTS AND ASSISTANCE TO PAKISTAN] and [CHINA'S MISSILE EXPORTS AND ASSISTANCE TO SYRIA])

[TEXT OF MTCR GUIDELINES]

[TEXT OF MTCR EQUIPMENT AND TECHNOLOGY ANNEX]

Updated 02/19/2004

This material is produced independently for NTI by the James Martin Center for Nonproliferation Studies at the Monterey Institute of International Studies and does not necessarily reflect the opinions of and has not been independently verified by NTI or its directors, officers, employees, agents. Copyright © 2007 by MIIS.