Government accused of allowing arms manufacturers to export in secret

Parliamentary watchdog on arms sales strongly criticises policy change

Exporters are being asked to seek “open” licences which do not require the value of the goods being publicly declared (Getty Images)

The Government is today accused by MPs of attempting to mask the scale of Britain’s arms trade by actively encouraging manufacturers to sell weaponry under an opaque procedure which keeps the value of exports out of the public domain.

Under a little-noticed shift in Britain’s policy governing sales of weapons and other sensitive equipment, exporters are being asked to seek “open” licences which allow multiple consignments to be sent to the same destinations abroad without the value of the goods being publicly declared.

The Parliamentary watchdog on arms sales strongly criticised the move, saying it will “inescapably reduce the transparency” of Britain’s arms exports and increase the risk that rules to halt inappropriate sales will be broken.

The annual report by the Committees on Arms Export Controls (CAEC) reveals that the UK sold arms more than £5bn to countries on the Government’s own human rights black list and questions whether ministers are imposing adequate controls on weapons being sent to authoritarian regimes.

The Export Control Organisation (ECO), the Government agency which oversees the sale of military and “dual-use” goods abroad, recently admitted that it is encouraging exporters “where possible” to shift away from Standard Individual Export Licences (SIELs), which approve a single consignment of controlled goods to be sent abroad within a two-year limit.

The Export Control Organisation admitted encouraging exporters to shift away from Standard Individual Export Licences (Getty Images)

Instead, officials want companies to apply for Open Individual Export Licences (OIELs), which allow an uncapped number of consignments to named destinations over a five-year period without an obligation to immediately specify the “end user”.

While the value of SIELs is made public, the value of OEILs are not declared because their open-ended nature means their value cannot be calculated at the outset.

The Department for Business, Innovation and Skills, which oversees the ECO, said its expects its policy to apply to “less sensitive goods” and all licences will continue to be judged against criteria designed to prevent inappropriate exports.

But figures obtained by The Independent show that the number of OEILs issued has increased in the last five years, reaching a peak of 2,001 in 2011, compared to 883 in 2009.

MPs said their concern about a growth in OEILs was deepened by figures which showed the Government has had to revoke or modify 99 of the licences since the start of the “Arab Spring” revolts in 2010 to destinations including Bahrain, Egypt, Libya as well as Russia since the outbreak of the conflict in Ukraine.

Among the revocations were licences for missile technology to Russia and tear gas and CS grenades to Bahrain.

The report said the policy to encourage OIELs was “likely to increase the risk of breaches of the Government’s own arms export control policies” and a reduction in the ability of Parliament and the public to scrutinise the scale of exports of weaponry.

Sir John Stanley, the chairman of CAEC, said: “There will certainly be a significant loss of transparency from the switching policy given that the Government discloses the value of SIELs but not of OIELs.”

In an effort to improve accountability, the MPs called on ministers to disclose for the first time the value of arms which actually leave Britain under OIELs every quarter.

Campaigners said the MPs’ findings added to existing concerns that exports under OIELs were going unmonitored, especially to countries with ongoing human rights concerns including Thailand, Pakistan and Vietnam.

Andrew Smith, of the Campaign Against Arms Trade, said: “There is already a lack of transparency in the arms trade, and the growing use of OIELs is only making this worse. They allow arms companies and governments to sell even more weapons without having to make it public when they are doing so.”

The MPs said that their findings concerning exports to countries with poor human rights records, including Bahrain and five others which do not feature on the Government’s own black list, meant that Britain needed to be far stricter with its approvals and should now take the step of naming the “end user” - whether a state body or a private company - for all arms exports.

The Government said it would respond to the MPs’ report in due course. A spokesman said: “We rigorously examine every licence application on a case-by-case basis against internationally recognised criteria. Risks around human rights abuses are a key part of our assessment and we do not grant licences where there is a clear risk that it might be used for internal repression.”

Licences to kill: UK arms exports

Britain cleared the export of weaponry including parts for combat jets, tanks and targeting equipment to Israel at the height of its assault on Gaza last summer, a Parliamentary report reveals.

Details of 12 export licences show that the licences were worth more than £600,000. They included £330,000 of components for tanks sent to Israel via Germany and £95,000 of combat aircraft components dispatched via America.

MPs called on the Government to declare whether it believed the technology in the licences may have been used in “the commission of a serious violation of international humanitarian law” in Gaza.

The Department for Business, Innovation and Skills is reviewing the 12 licences.