U.S. reduces FMS administrative surcharge

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WASHINGTON, Sept. 25 (UPI) -- The U.S. Defense Security Cooperation Agency is reducing the administrative surcharge for Foreign Military Sales customers.

Revision of procedures that calculate a safe level of reserve in the FMS Administrative Surcharge Account have also been instituted the agency said.

As of Nov. 1, the FMS Administrative Surcharge Rate will be reduced from 3.8 percent to 3.5 percent.

"This surcharge is assessed on the total value of an FMS sale and covers the administrative management costs of the FMS program which, in accordance with Section 21 of the Arms Export Control Act, is managed at no cost to the U.S. government," the agency said.

The surcharge reduction, it said, is supported by FMS leadership in the Department of Defense, Department of State and Office of Management and Budget.

The reduction in the administrative surcharge rate change is the latest improvement FMS system. Other changes enacted have included reducing the time to develop a sale, revising the method for calculating termination liability and rescinding the Small Case Management Line, it said.