Offsets In International Arms Trade - Need For A National Policy
......The British defense industry was quick to grasp the increasing importance of offsets. The British Defense Manufacturers Offset Group was established in 1990. The members exchange knowledge on offsets and share expertise to deal with different countries. It is also creating a data bank wherein the offset policies of the major arms buying countries have been compiled to enable the members to negotiate effectively.
In addition, the Defense Export Services Organization under the British Ministry of Defense provides support and offset advice to British arms exporters. It also administers the policies for seeking offsets from the producers who export to Britain. The British call it Industrial Participation (IP). Under the British IP policy, a minimum of 100 per cent offset is essential for all contracts over 50 million pounds for French and German companies, and 10 million pounds for all others. It further stipulates that offsets have to be defense related, new and of equivalent technical quality; and have to be fulfilled within the period of the main contract and at no extra cost. It permits both direct and indirect offsets. Incidentally, the UK’s offset benefits exceed 5 billion pounds, with the USA being the main provider.......