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C. No material, equipment, device, or restricted data transferred pursuant to this Agreement, and no equipment or device which would disclose any restricted data transferred pursuant to this Agreement, shall be transferred to any unauthorized person or beyond the jurisdiction of the country receiving it, without the written consent of the Party to this Agreement from which or by permission of which it was received. Such consent will not be given on behalf of the Government of the United States unless the transfer in respect of which it is requested is within the scope of an agreement for cooperation made in accordance with Section 123 of the United States Atomic Energy Act of 1954.

Article IX bis

“Responsibility for Use of Information, Material, Equipment and Devices

"The application or use of any information (including design drawings and specifications), material, equipment or device, exchanged or transferred between the Parties under this Agreement shall be the responsibility of the Party receiving it, and the other Party does not warrant the accuracy or completeness of such information and does not warrant the suitability of such information, material, equipment, or device for any particular use or application."

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IN WITNESS WHEREOF, the undersigned, duly authorized, have signed this Agreement.

Done at Washington this Fifteenth day of June, 1955, in two original texts.

FOR THE GOVERNMENT OF THE UNITED STATES

OF AMERICA
Robert Murphy
Lewis Strauss

FOR THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND

R. H. Scott

APPENDIX G

MEMORANDUM OF UNDERSTANDING, DATED 30th OCTOBER, 1952, BETWEEN THE UNITED STATES OF AMERICA AND HER MAJESTY'S GOVERNMENT IN THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND RELATING TO THE OFFSHORE PROCUREMENT PROGRAMME

1. Offshore Procurement Programme: Principles and Policies

This memorandum sets forth certain principles and policies which the Governments of the United States of America and the United Kingdom of Great Britain and Northern Ireland intend will govern the agreements and contracts for the procurement of supplies, services, equipment and materials placed by the United States military departments in the United Kingdom with either Her Majesty's Government or (in so far as may be appropriate) private contractors under the Offshore Procurement Programme. It is the intention of the two Governments that the terms of this memorandum shall apply to agreements and contracts placed after the date hereof and also to uncompleted agreements and contracts placed prior to the date hereof.

The Offshore Procurement Programme includes procurement of military items by the United States for the use of other countries participating in the Mutual Security Programme or for the use of the United States Armed Forces. It is intended that the Offshore Procurement Programme will materially contribute to the combined defence productive capacity of the nations which are members of the North Atlantic Treaty Organisation or the European Defence Community and will at the same time provide a means of increasing the dollar earnings of those countries.

The United States Government will conduct the Offshore Procurement Programme in accordance with the laws of the United States governing military procurement and, to the extent applicable, the Mutual Security Programme. It is also the intent of the United States that the Offshore Procurement Programme shall be carried out in the United Kingdom in furtherance of the principles set forth in Section 516 of the Mutual Security Act of 1951. Economic Co-operation Agreement between the Government of the United Kingdom and the Government of the United States of America signed in London on 6th July, 1948, as amended. 2. Inter-Governmental Co-ordination

The programme of the United States Government for procurement of military items in the United Kingdom will be co-ordinated with the defence programme of Her Majesty's Government. To this end appropriate officials of the two Governments will consult together on a continuing basis to study production problems related to the United States Government's procurement programme and will exchange information with respect to: procurement plans; availability of production facilities; production progress related to offshore procurement; subcontracts placed by Her Majesty's Government outside the United Kingdom; and contracts placed by the United States Government with private contractors in the United Kingdom. 3. Contract Placement by Contracting Officers

It is understood that offshore procurement contracts will be placed and administered on behalf of the United States Government by contracting officers of the United States Military Departments. 4. Parties to Contracts

United States Contracting Officers may enter into agreements or contracts with Her Majesty's Government or directly with individuals, firms or other legal entities in the United Kingdom. 5. Contract Assistance

Her Majesty's Government will, upon request of the Contracting Officer, provide as far as possible advice in regard to prospective contractors and subcontractors and will assist the United States Government and individual contractors to the extent practicable and appropriate in the administering and carrying out of offshore procurement contracts. 6. Supply of Equipment Materials and Man-power

Her Majesty's Government will, subject to their overriding defence needs, accord to offshore procurement contractors and their subcontractors proiorities for securing equipment, materials, man-power and services equal to those which are accorded to contractors having similar types of contracts with Her Majesty's Government. 7. Security

In the case of procurement contracts placed by the United States Government with Her Majesty's Government, any classified material delivered by one Government to the other will be given a corresponding security classification by the recipient Government and treated in the same manner as its own classified material of similar security grading.

In the case of procurement contracts placed by the United States Government with private United Kingdom contractors, similar security arrangements for classified material will be followed. Classified material of the United States Government needed by a United Kingdom contractor will be delivered to the appropriate Ministry of Her Majesty's Government. An official of that Ministry will transmit the material to the contractor in such a way as to make the provisions of the Official Secrets Acts applicable to it. Such materials will, prior to transmittal, receive a security classification of Her Majesty's Government corresponding to the United States Government's security classification, and at the time of transmittal Her Majesty's Government will notify the contractor that the classified material delivered to him is also classified material of Her Majesty's Government and subject to the provisions of the Official Secrets Acts.

Her Majesty's Government will, upon request, conduct a security investigation of any prospective United Kingdom contractor to the United States Government in the same manner as such investigations are conducted in cases of defence procurement by Her Majesty's Government, and a recommendation resulting from such investigation will be made to the United States Government. 8. Inspection

Inspection of all materials, supplies, equipment and services procured by the United States Government in the United Kingdom either from Her Majesty's Government or from the United Kingdom manufacturers and suppliers will be carried out by representatives of Her Majesty's Government when requested by the United States Government. Her Majesty's Government will certify to the United States Government that the products so inspected meet all specifications and other requirements of the contract. The United States Government may verify such inspection. Where charges are made for inspection services in connection with materials, supplies, equipment or services procured by the United States Government from Her Majesty's Government, such inspection charges will be included in the proposed agreement prices quoted to the United States Government. Where charges are to be made for such inspection services in connection with procurements made directly by the United States Government from contractors in the United Kingdom the respective Governments will execute an agreement to cover such charges. Her Majesty's Government will ensure in all cases that inspection charges are fair and reasonable in relation to the cost of the services provided and will waive such charges where the items procured in the United Kingdom by the United States Government are delivered to Her Majesty's Government. Her Majesty's Government is also prepared to consider waiving such charges in other suitable cases, such as those where it appears that inspection for the United States Government will involve no appreciable extra burden of inspection to Her Majesty's Government.

9. Credit Arrangements

It is understood that the request of the Chancellor of the Exchequer to the banks on the application of credit policy to "ensure the highest priority for our defence programme” will be regarded as applying equally to defence orders placed with United Kingdom firms for the United States Offshore Procurement Programme. 10. Licences

It is the intention of Her Majesty's Government to facilitate the granting of any necessary licences, including exchange control, export and import licences, which may be required in connection with any United States Government offshore procurement contract in the United Kingdom. 11. Taxes

The provisions of the Exchange of Notes dated 17th and 18th March, 1952, as well as the agreed procedures which have been worked out thereunder are applicable to the procurement programme of the United States Government in the United Kingdom. The two Governments may consult from time to time as the occasion arises regarding the provisions of the Exchange of Notes and the agreed procedures. 12. Standard Agreement Clauses

Standard clauses have been approved by the two Governments for use, as appropriate, in agreements between them. Other clauses, such as price variation and escalation clauses, may be included in individual agreements. 13. Protection of United States Property and Personnel

It is understood that, in accordance with existing law and practice in the United Kingdom, the United States Government is protected against suits or legal process or other legal liability in the United Kingdom. The property of the United States Government is immune from all legal process or other legal action which would deprive the United States Government of such property. Procurement officers and other authorised agents of the United States Government are also protected in the United Kingdom from legal suits or process arising out of the placing and carrying-out of offshore procurement contracts under the programme. Her Majesty's Government will use their good offices to assist in carrying out the above understandings in specific cases as they may arise. 14. Destination of End-Items

Although the determination of specifications and other requirements of particular offshore procurement contracts may require a tentative identification of the recipient country for the end-items to be produced, it is understood that, unless otherwise specifically

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