Official Statistics

Strategic export controls commentary: 1 October to 31 December 2020

Updated 13 July 2021

1. Statistical commentary

Coverage: UK

Frequency: Quarterly

Date of publication: 13 April 2021

Next publication: 13 July 2021

Statistical Contact: ECO.statistics@trade.gov.uk

Website: https://www.gov.uk/government/collections/strategic-export-controls-licensing-data

This statistics release provides the data about decisions made on licence applications to the Export Control Joint Unit (ECJU) of the Department for International Trade (DIT).

The ECJU is the regulatory body which controls exports of military goods and dual-use goods (civilian goods that can be used for military purposes) from the UK.

2. Headline results

• Between 1 October and 31 December 2020, there were a total of 3,503 licensing decisions for Standard Individual Export Licences (SIELs), up 23.0% from 2,847 in the previous quarter.
• Of these standard licensing decisions, 3,407 (97.3%) were issued, 96 (2.7%) were refused, and no licences were revoked.
• Licensing decisions for Open Individual Export Licences (OIELs) were up by 118 compared with the previous quarter, from 63 to 181.
• Of these open licensing decisions, 158 (87.3%) were issued, 23 (12.7%) were rejected, and no licences were revoked.
• Between 1 October and 31 December 2020, 60% of SIELs were processed to first outcome within 20 working days, and 48% of OIELs were processed to first outcome within 60 working days.

3. Introduction

This commentary accompanies the latest Quarterly Strategic Export Controls Statistics data tables, published on the DIT strategic export controls statistics web page on 13 April 2021. The data tables present the latest detailed information on licensing decisions for each quarter from 2008 Q1 to 2020 Q4. The data presented here are based on a snapshot of the live system data taken on 16 March 2021.

Licence applications are submitted to and processed by the Export Control Joint Unit (ECJU) through a purpose-built online licensing system called SPIRE. There are several types of licence and the type of licence applied for will depend on numerous factors such as the type and volume of goods being exported, the destination and who will be using the goods.

The statistics present a picture of how licensing decisions have been made, which is useful for policy officials in the ECJU and also allows analysis of the operational efficacy of the licensing system. The data are also regularly used by the press, non-government organisations and academics to evaluate strategic export control policies. Further detail is available in this document under uses of the data.

4. Summary of results

4.1 Issued licences

• Export and trade control licences give permission for certain strategic exports to be made from the UK to another destination, and for overseas trade in strategic goods. The actual number and value of transactions made under the licences is likely to be less than the total made available under the licences issued. This is because some licences will not be used to make all of the exports authorised and others will not be used at all.
• Standard Individual Export Licences (SIELs) are by far the most common licence type issued for export of controlled goods from the UK. The number of SIELs issued each quarter since 2008 Q1 has averaged 3,133, much higher than OIELs (72), SITCLs (42) and OITCLs (6). Registrations to use Open General Export Licences (OGELs) have averaged around 350 each quarter since 2008 Q1.

Chart 1: Number of SIELs issued, by licence sub-type

Source: Table A, Strategic Export Controls Licensing Statistics

• Issued SIELs are predominantly of the ‘permanent standard’ sub-type (see Chart 1 which is clearly driving the overall trend in total SIELs. However, ‘temporary standard’ and ‘incorporation’ SIELs are not insignificant, making up around 7% and 10% (respectively) of issued SIELs each quarter, on average. Total issued SIELs each quarter increased slowly between 2008 Q1 and 2013 Q1, when they reached 3,609. Since then the trend varied between c.3,000 and c.3,500, reaching a peak of 3,720 in 2015 Q3, although there was a notable dip in licences issued in 2014 Q2. This coincided with the rollout of a new IT system in the Department for Business, Innovation and Skills, which is likely to explain the fall. The peak in the following quarter is likely to be due to the ECJU clearing the backlog of applications that had accumulated.
• The increase between 2014 Q2 and 2014 Q3 is likely to be explained by operational reasons. Increased resourcing from around May 2014 helped with more licence decisions being made. The number of licences issued in 2015 Q3 was the highest since records began in 2008 Q1 at 3,720. Again, this is likely to be explained by operational reasons.
• The number of licences issued in 2019 Q4 was the lowest since 2009 Q2 at 2,663. This is likely to be due to the effects of the judgment of the Court of Appeal of 20 June 2019 regarding licences for Saudi Arabia for equipment for possible use in Yemen, the Secretary of State’s subsequent statement to Parliament regarding licences for exports to Saudi Arabia and its coalition partners (UAE, Kuwait, Egypt, Bahrain, Jordan, Sudan) which might be used in the conflict in Yemen, and the Foreign Secretary’s statement to Parliament of 15 October 2019 regarding export licences for items that might be used in Turkish military operations in Syria.
• The increase from 2,778 in 2020 Q3 to 3,407 in 2020 Q4 is likely to be due to increased licence processing to clear the backlog of applications arising from the judgment of the Court of Appeal of 20 June 2019.

Chart 2: Value of goods issued for exportation under SIEL licences

Source: Table E, Strategic Export Controls Licensing Statistics

• Chart 2 shows how the value of goods issued for exportation under SIELs can vary a lot from quarter to quarter, with a handful of high value licences often explaining peaks in the data. The goods are valued by the licence applicant and not all goods licensed are actually exported.
• Noticeable peaks in 2009 Q2, 2011 Q2, 2013 Q1, 2013 Q2, 2015 Q2, 2020 Q2 and 2020 Q3 can be explained by a handful of licences. Around £1.5 billion of the £3.8 billion worth of goods licensed in 2009 Q2 was for combat aircraft to Saudi Arabia. A series of high value licences (between £10 million and £20 million) for equipment employing cryptography to Malaysia, totalling around £615 million, along with a licence to the USA for materials containing enriched and natural uranium, valued at around £575 million also contributed to the 2009 Q2 peak.
• In 2011 Q2, goods valued at £2.3 billion, largely relating to components for military aero-engines, licensed to France, made up a large proportion of the £5.7 billion of goods. Around £1.5 billion was for combat aircraft to Saudi Arabia, which were issued due to the previous licence for goods in 2009 Q2 not being fully utilised. Where licences are not fully utilised a new application for the goods may be made. As a result, a particular good may be licensed several times within the historical trend.
• In 2013 Q1, equipment employing cryptography, for non-military use, was issued for export to Israel, which made up most of the value of licences issued in that quarter. Although issued, this licence was surrendered before any goods were shipped.
• In 2013 Q2 the approximately £1.5 billion of combat aircraft to Saudi Arabia had still not been fully shipped, so new licences were again issued for the same value of the same goods. The same happened again in 2015 Q2; new licences were again issued for a similar value of the same goods.
• In 2015 Q3 one licence for Saudi Arabia accounted for approximately 40% of the total value of all licences granted; this was part of a long-term contract for the delivery, over a number of years, of a new munitions capability.
• In 2017 Q2 a peak in the value of goods licensed can be explained by a couple of licences; around £1.2 billion is related to a licence for combat aircraft to Oman and around £800 million is related to a further licence to Saudi Arabia for the delivery, over a number of years, of a new munitions capability as noted above, which was issued due to the previous licence for goods in 2015 Q3 not being fully utilised.
• In 2018 Q2, one licence for the United States of America accounted for over 60% of the total value of all licences granted. This licence, valued at £2.76 billion, was for information security equipment to the USA for holding in stock. This licence was re-issued in 2019 Q2, which explains the peak in the value of goods licensed in this period.
• In 2020 Q2, the value of nine licences for the United States of America combined accounted for around 89% of the total value of all licences granted in that quarter. These licences, valued at £8.2 billion in total, were for information security equipment to the USA for holding in stock.

• In 2020 Q3, the value of 1 licence for the United States of America accounted for around 60% of the total value of all licences granted in that quarter. This licence, valued at £4.1 billion in total, was for information security equipment to the USA for holding in stock.

• Unlike SIELs for permanent export, a temporary SIEL may permit the export of the goods to multiple destinations, provided they are returned to the UK within 12 months of export. For example, an item might be exported from the UK for an exhibition in one country, before being moved directly to another exhibition in a second country, and so on, before they are returned to the UK. Currently the total value of temporary goods is calculated as the sum of temporary goods licensed to each destination, meaning that the same goods can be counted multiple times. The values of goods licensed for temporary export, using the current methodology, make up 3% of all goods values across all SIELs between 2008 Q1 and 2020 Q3. However, there have been quarters within this time period in which the proportion of goods values licensed for temporary export under SIELs has been considerably higher (for example, in 2008 Q2 the value of goods on temporary licences was 23%, 2015 Q2 was 20% and 2014 Q2 was 13%).

Chart 3: Number of OIELs issued by licence sub-type

Source: Table A, Strategic Export Controls Licensing Statistics

• Issued OIELs were largely comprised of ‘standard’ OIELs (see Chart 3. The number of OIELs issued is much smaller than the number of SIELs issued, however the quantity of goods for exportation is generally not limited on OIELs.
• The peaks of 105, 143 and 105 OIELs issued in 2016 Q4 and 2017 Q1 and 2017 Q3 respectively are primarily a result of clearing a backlog of applications that had built up, which also explains why the number issued in 2016 Q3 was lower than the average for recent quarters. OIELs can be renewed every 5 years and these peaks also coincide with an increased number of renewal applications over these periods.
• The increase from 57 in 2020 Q3 to a record high of 158 in 2020 Q4 was likely a combination of higher volumes of applications being received, which included unusually high volumes for OIELs to export information security equipment and technology to the United States. There was also a partial clearing of the backlog of applications arising from the judgment of the Court of Appeal of 20 June 2019 that could also be attributed to some of the increase.

Chart 4: Number of licences refused/rejected by licence type

Source: Table A, Strategic Export Controls Licensing Statistics

• The numbers of SIELs and SITCLs refused and OIELs and OITCLs rejected tend to be much lower than the numbers issued (see Chart 4). However, SIEL refusals consistently exceed other licence types by around 58 refusals per quarter on average. The number of SIELs refused in each quarter has averaged 62 but some periods have seen over 100 refusals, including 2010 Q4 when 111 were refused, 2015 Q3 when 104 were refused, 2016 Q3 when 104 were refused, and 2017 Q2 when 117 were refused. In 2010 Q4, most (85) of these were refusals for licences to Iran, due to a broader range of sanctions coming into effect on 25 October 2010 (Council Regulation (EU) No 961/2010). Please see the ECJU website for more details about sanctions on Iran.
• In 2015 Q3, around a quarter of the refusals were for licences to Russia (26). Along with Russia, refusals for licences to China (22), Iran (17) and Pakistan (10) made up the bulk of the 106 refusals. Each of these refusals were due to sanctions in place for these destinations. In 2016 Q3, refusals for licences to United Arab Emirates (28), Pakistan (17), China (16) and Iran (10) made up the bulk of the 104 refusals. In 2017 Q2, the bulk of refusals were for licences to Pakistan (40), Russia (20) and Iran (11), predominantly under the end use controls.

Table 1: Number of licences revoked by licence type

Period	OIEL	OITCL	SIEL	SITCL
2008 Q1	0	0	1	0
2008 Q2	0	0	1	0
2008 Q3	7	0	0	0
2008 Q4	6	0	19	0
2009 Q1	0	0	1	0
2009 Q2	0	0	1	0
2009 Q3	1	0	10	0
2009 Q4	0	0	2	0
2010 Q1	0	0	0	0
2010 Q2	0	0	0	0
2010 Q3	0	0	0	0
2010 Q4	0	0	0	0
2011 Q1	14	0	121	2
2011 Q2	1	0	2	0
2011 Q3	1	0	1	0
2011 Q4	0	0	1	0
2012 Q1	0	0	2	0
2012 Q2	7	0	38	0
2012 Q3	0	0	2	0
2012 Q4	1	0	0	0
2013 Q1	0	0	0	0
2013 Q2	1	0	5	0
2013 Q3	0	0	6	0
2013 Q4	3	0	5	0
2014 Q1	12	1	2	0
2014 Q2	0	0	11	0
2014 Q3	50	1	35	0
2014 Q4	0	0	1	0
2015 Q1	2	0	9	0
2015 Q2	2	0	3	0
2015 Q3	1	0	0	0
2015 Q4	0