
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 22USC2796]

 
               TITLE 22--FOREIGN RELATIONS AND INTERCOURSE
 
                     CHAPTER 39--ARMS EXPORT CONTROL
 
    SUBCHAPTER VI--LEASES OF DEFENSE ARTICLES AND LOAN AUTHORITY FOR 
              COOPERATIVE RESEARCH AND DEVELOPMENT PURPOSES
 
Sec. 2796. Leasing authority


(a) Preconditions

    The President may lease defense articles in the stocks of the 
Department of Defense to an eligible foreign country or international 
organization if--
        (1) he determines that there are compelling foreign policy and 
    national security reasons for providing such articles on a lease 
    basis rather than on a sales basis under this chapter;
        (2) he determines that the articles are not for the time needed 
    for public use;
        (3) the President first considers the effects of the lease of 
    the articles on the national technology and industrial base, 
    particularly the extent, if any, to which the lease reduces the 
    opportunities of entities in the national technology and industrial 
    base to sell new equipment to the country or countries to which the 
    articles are leased; and
        (4) the country or international organization has agreed to pay 
    in United States dollars all costs incurred by the United States 
    Government in leasing such articles, including reimbursement for 
    depreciation of such articles while leased, the costs of restoration 
    or replacement if the articles are damaged while leased, and, if the 
    articles are lost or destroyed while leased--
            (A) in the event the United States intends to replace the 
        articles lost or destroyed, the replacement cost (less any 
        depreciation in the value) of the articles; or
            (B) in the event the United States does not intend to 
        replace the articles lost or destroyed, an amount not less than 
        the actual value (less any depreciation in the value) specified 
        in the lease agreement.

The requirement of paragraph (4) shall not apply to leases entered into 
for purposes of cooperative research or development, military exercises, 
or communications or electronics interface projects. The President may 
waive the requirement of paragraph (4) for reimbursement of depreciation 
for any defense article which has passed three-quarters of its normal 
service life if the President determines that to do so is important to 
the national security interest of the United States. The President may 
waive the requirement of paragraph (4) with respect to a lease which is 
made in exchange with the lessee for a lease on substantially reciprocal 
terms of defense articles for the Department of Defense, except that 
this waiver authority--
        (A) may be exercised only if the President submits to the 
    Committee on Foreign Affairs and the Committee on Appropriations of 
    the House of Representatives and the Committee on Foreign Relations 
    and the Committee on Appropriations of the Senate, in accordance 
    with the regular notification procedures of those Committees, a 
    detailed notification for each lease with respect to which the 
    authority is exercised; and
        (B) may be exercised only during the fiscal year \1\ the current 
    fiscal year and only with respect to one country, unless the 
    Congress hereafter provides otherwise.
---------------------------------------------------------------------------
    \1\ So in original. The words ``the fiscal year'' probably should 
not appear.

The preceding sentence does not constitute authorization of 
appropriations for payments by the United States for leased articles.

(b) Duration; termination

    Each lease agreement under this section shall be for a fixed 
duration of not to exceed five years and shall provide that, at any time 
during the duration of the lease, the President may terminate the lease 
and require the immediate return of the leased articles.

(c) Applicable statutory authorities

    Defense articles in the stocks of the Department of Defense may be 
leased or loaned to a foreign country or international organization only 
under the authority of this subchapter or chapter 2 of part II of the 
Foreign Assistance Act of 1961 [22 U.S.C. 2311 et seq.], and may not be 
leased to a foreign country or international organization under the 
authority of section 2667 of title 10.

(Pub. L. 90-629, ch. 6, Sec. 61, as added Pub. L. 97-113, title I, 
Sec. 109(a), Dec. 29, 1981, 95 Stat. 1524; amended Pub. L. 99-500, 
Sec. 147, Oct. 18, 1986, 100 Stat. 1783-351, and Pub. L. 99-591, 
Sec. 147, Oct. 30, 1986, 100 Stat. 3341-354; Pub. L. 100-202, 
Sec. 101(e) [title V, Sec. 556], Dec. 22, 1987, 101 Stat. 1329-131, 
1329-170; Pub. L. 100-461, title V, Sec. 552, Oct. 1, 1988, 102 Stat. 
2268-35; Pub. L. 101-167, title V, Sec. 550, Nov. 21, 1989, 103 Stat. 
1235; Pub. L. 101-513, title V, Sec. 546, Nov. 5, 1990, 104 Stat. 2019; 
Pub. L. 102-145, Sec. 118, as added Pub. L. 102-266, Sec. 102, Apr. 1, 
1992, 106 Stat. 93; Pub. L. 102-391, title V, Sec. 544, Oct. 6, 1992, 
106 Stat. 1672; Pub. L. 103-87, title V, Sec. 524, Sept. 30, 1993, 107 
Stat. 952; Pub. L. 103-236, title VII, Sec. 731(e), Apr. 30, 1994, 108 
Stat. 503; Pub. L. 103-306, title V, Sec. 524, Aug. 23, 1994, 108 Stat. 
1632; Pub. L. 104-107, title V, Sec. 524, Feb. 12, 1996, 110 Stat. 729; 
Pub. L. 104-164, title I, Secs. 146, 153(a), July 21, 1996, 110 Stat. 
1434, 1440; Pub. L. 104-208, div. A, title I, Sec. 101(c) [title V, 
Sec. 524], Sept. 30, 1996, 110 Stat. 3009-121, 3009-149; Pub. L. 105-
118, title V, Sec. 524, Nov. 26, 1997, 111 Stat. 2412; Pub. L. 105-277, 
div. A, Sec. 101(d) [title V, Sec. 524], Oct. 21, 1998, 112 Stat. 2681-
150, 2681-177.)

                       References in Text

    The Foreign Assistance Act of 1961, referred to in subsec. (c), is 
Pub. L. 87-195, Sept. 4, 1961, 75 Stat. 424, as amended. Chapter 2 of 
part II of that Act is classified generally to part II (Sec. 2311 et 
seq.) of subchapter II of this chapter. For complete classification of 
this Act to the Code, see Short Title note set out under section 2151 of 
this title and Tables.

                          Codification

    Amendment by Pub. L. 102-145 is based on section 545 of H.R. 2621, 
One Hundred Second Congress, 1st Session, as passed by the House of 
Representatives on June 19, 1991, which was enacted into law by Pub. L. 
102-145, Sec. 118, as added by Pub. L. 102-266, Sec. 102, Apr. 1, 1992, 
106 Stat. 93. Section 118 of Pub. L. 102-145 provided that the authority 
and conditions provided in such section 545 shall be applicable to funds 
appropriated by Pub. L. 102-145 (and are hereby enacted) in lieu of the 
authority and conditions provided in section 546 of Pub. L. 101-513. See 
1990, 1991, and 1992 Amendment notes below.
    Pub. L. 99-591 is a corrected version of Pub. L. 99-500.


                               Amendments

    1998--Subsec. (a). Pub. L. 105-277 substituted ``the current fiscal 
year'' for ``1998'' in par. (B).
    1997--Subsec. (a). Pub. L. 105-118 substituted ``1998'' for ``1997'' 
in par. (B).
    1996--Subsec. (a). Pub. L. 104-164, Sec. 153(a), struck out ``, or 
to any defense article which has passed three-quarters of its normal 
service life.'' after ``electronics interface projects'' in second 
sentence and inserted after second sentence ``The President may waive 
the requirement of paragraph (4) for reimbursement of depreciation for 
any defense article which has passed three-quarters of its normal 
service life if the President determines that to do so is important to 
the national security interest of the United States.''
    Pub. L. 104-208 substituted ``1997'' for ``1996'' in par. (B).
    Pub. L. 104-107 substituted ``1996'' for ``1995'' in par. (B).
    Subsec. (a)(4). Pub. L. 104-164, Sec. 146, substituted ``and, if the 
articles are lost or destroyed while leased--
        ``(A) in the event the United States intends to replace the 
    articles lost or destroyed, the replacement cost (less any 
    depreciation in the value) of the articles; or
        ``(B) in the event the United States does not intend to replace 
    the articles lost or destroyed, an amount not less than the actual 
    value (less any depreciation in the value) specified in the lease 
    agreement'' for ``and the replacement cost (less any depreciation in 
    the value) of the articles if the articles are lost or destroyed 
    while leased''.
    1994--Subsec. (a). Pub. L. 103-306 substituted ``1995'' for ``1994'' 
in par. (B).
    Pub. L. 103-236 struck out ``and'' at end of par. (2), added par. 
(3), redesignated former par. (3) as (4), and substituted ``paragraph 
(4)'' for ``paragraph (3)'' in two places in provisions following par. 
(4).
    1993--Subsec. (a). Pub. L. 103-87 substituted ``1994'' for ``1993'' 
in par. (B).
    1992--Subsec. (a). Pub. L. 102-391 substituted ``1993'' for ``1992'' 
in par. (B).
    Pub. L. 102-266 added Pub. L. 102-145, Sec. 118. See 1991 Amendment 
note below.
    1991--Subsec. (a). Pub. L. 102-145, Sec. 118, as added by Pub. L. 
102-266, substituted ``1992'' for ``1991'' in par. (B). See Codification 
note above.
    1990--Subsec. (a). Pub. L. 101-513 substituted ``1991'' for ``1990'' 
in par. (B).
    1989--Subsec. (a). Pub. L. 101-167 substituted ``1990'' for ``1989'' 
in par. (B).
    1988--Subsec. (a). Pub. L. 100-461 substituted ``1989'' for ``1988'' 
in par. (B).
    1987--Subsec. (a). Pub. L. 100-202 substituted ``1988'' for ``1987'' 
in par. (B).
    1986--Subsec. (a). Pub. L. 99-500 and Pub. L. 99-591 inserted 
provision authorizing the President to waive the requirements of par. 
(3) with respect to a lease which is made in exchange with the lessee 
for a lease on substantially reciprocal terms of defense articles for 
the Department of Defense and providing exceptions to such waiver 
authority.

                         Change of Name

    Committee on Foreign Affairs of House of Representatives treated as 
referring to Committee on International Relations of House of 
Representatives by section 1(a) of Pub. L. 104-14, set out as a note 
preceding section 21 of Title 2, The Congress.


                    Effective Date of 1996 Amendment

    Section 153(b) of Pub. L. 104-164 provided that: ``The third 
sentence of section 61(a) of the Arms Export Control Act, as added by 
subsection (a)(2) [22 U.S.C. 2796(a)], shall apply only with respect to 
a defense article leased on or after the date of the enactment of this 
Act [July 21, 1996].''

                         Delegation of Functions

    Functions of President under this section delegated to Secretary of 
Defense by section 1(r) of Ex. Ord. No. 11958, Jan. 18, 1977, 42 F.R. 
4311, as amended, set out as a note under section 2751 of this title.

                  Section Referred to in Other Sections

    This section is referred to in section 2291c of this title.
