Australian Defence Companies Learning to Navigate South Korean Export
Controls

As defence and industrial collaboration between Australia and South Korea

continues to grow, more Australian companies such as Hanwha Defence Australia

(HDA) are engaging directly with Korean government agencies and defence

manufacturers. These partnerships present significant opportunities, particularly in

acquisition and sustainment, co-development, and transfer of technology. However,

they also introduce new and complex compliance challenges, especially when it

comes to navigating South Korea’s export control framework.

For Australian companies requiring access to technical data or defence articles from

South Korea, one of the first hurdles is securing a Korean Export Licence (EL).

These licences are issued and regulated by the Defense Acquisition Program

Administration (DAPA), Korea’s central government authority for defence. While

many Australian companies are already familiar with managing export controls under

Australia’s Defence Export Controls (DEC) or the U.S. ITAR regime, the Korean

system presents a different set of expectations and requirements.

The process for obtaining a Korean EL for data that is owned by DAPA, is often

unfamiliar and can be slower than anticipated. Approvals tend to be highly

centralised, sometimes requiring multiple layers of review within Korean government

departments or defence original equipment manufacturers (OEMs). DAPA tend to

also seek additional information through Korean defence OEMs, placing more

pressure on Australian companies to provide low level information to South Korea to

expedite Korean ELs.

In a recent example, an Australian defence company required ELs to access

technical data from a Korean partner for a sustainment activity. Although all parties

involved supported the data transfer in principle, the actual approval process took

months, partly due to internal reviews, changing of requirements placed onto the

Australian company, and a cautious approach from the Korean side.

This caution is understandable. South Korea, like Australia, places a high value on

the protection of its strategic defence data. But unlike Australia, where data sharing

may progress once security frameworks like the Defence Industry Security (DISP)

are in place, Korean stakeholders are often reluctant to release even unclassified

material until formal EL approvals are granted.

In many cases, even low-level technical data cannot be shared until the relevant

paperwork is signed and validated by DAPA. In Australia and the US, many of our

export permits/licenses allow for data to be transferred to subcontractors as per the

contract, i.e. a Technical Assistance Agreement (TAA) from the US and a

corresponding US license. Once these agreements are approved, data can flow as

required to the approved subcontractors.

With the current Korean export controls framework, the process is not designed to

allow ‘blanket’ type permits and agreements that allow the free flow of data that we

see here in Australia, the US and other countries who are regular defence exporters.

For example, if Korean data or IP is owned by the Korean Government, then each

line of data must be included in the EL application. If any data is missed from the

original EL application, or new data is developed with a new drawing number for

example that is not included in the original EL, a new EL must be applied for, even

for the same subcontractor.

This can create multiple EL applications at the same time for the one subcontractor.

This inefficient and resource intensive way of conducting licensing applications can

hinder milestones and timeframes for relevant defence companies in contract with

their respective governments. Not only does this affect the recipients of Korean data,

but it also creates more work for the Korean defence OEMs and Government alike.

These issues are compounded by differences in procurement practises between the

two countries. In Australia, Defence and prime contractors typically go out to market

during project planning and delivery phases, often issuing Requests for Tender

(RFTs) to multiple subcontractors all vying for the contract. This open competition

model is expected as part of Commonwealth Procurement Guidelines as part of a

demonstrated value for money and/or an Australian Industry Capability (AIC) aspect.

It also means that Korean data owned by the Korean Government, ie DAPA,

sometimes needs to be shared with potential Australian subcontractors before any

one of them is awarded the work. As a result, Korean ELs are required for each

individual subcontractor, even if the subcontractor does not win the contract, with

those Individual ELs also listing the specific line items of data as mentioned above.

This micromanagement approach for Korean EL applications continues to make the

process slow and less efficient for all parties involved, in turn effecting Australian

companies’ procurement schedules and supply chains due to the ‘red tape’ with the

Korean export process.

Language barriers and differing terminology can also cause confusion, especially

when dealing with technical documents or referencing export control laws. There

have been instances where requests were misunderstood, or documents were

delayed due to differences in how each country interprets data classification and

control levels.

Despite these challenges, progress is being made. Over the past 12 months, there

has been more open communication between DAPA, the Australian Department of

Defence, and industry stakeholders. These communication channels have been

organised through open collaboration between both Australian and Korean

governments, where face-to-face meetings have been held with attendees present

from both governments. These conversations are helping to build a shared

understanding of each other’s processes and expectations.

Since the Government-to-Government meetings have taken place, Korean ELs have

been successfully issued at a faster rate, allowing controlled data to be transferred

from Korea to Australian companies, and then passed on to Australian

subcontractors under proper authorisations.

These positive outcomes show that while the process may be complex, it is workable

with persistence, clarity, and mutual respect. One of the most encouraging

developments has been the willingness of both governments to listen to industry

feedback. Both governments have a stake in supporting their industrial bases to be

successful. There is now recognition on both sides that data exchange is a key

enabler of effective collaboration, and that export controls should support, not hinder,

government-sanctioned defence programs.

One area that may offer future improvement is clearer guidance from Korean

defence primes working with Australian partners. Providing clear advice and

documents translated to English that outline the Korean export licensing process,

could reduce delays and build trust between parties. Similarly, Korean companies

could benefit from tailored guidance when engaging with Australian defence primes

for the first time.

While the system is still evolving, there is a growing sense of cooperation. Both the

Korean and Australian governments are committed to deepening their strategic

partnership, and export control reform is part of that journey. By continuing to build

relationships, share lessons learned, and invest in mutual understanding, the two

countries are laying the groundwork for more seamless defence collaboration in the

future. This could mean more opportunities for Korea and Australia within the Indo-

Pacific region or further abroad, whether through AUKUS Pillar II or other

collaborative forums.

For now, Australian companies entering the Korean market should be prepared to

navigate a system that is complex and dynamic. Success comes not just from

understanding the regulations, but also from approaching the engagement with

patience, cultural awareness, and a willingness to adapt.

As more joint defence projects emerge, the ability to securely and efficiently manage

controlled data transfers will be a crucial element of success. The experience so far

suggests that while there is still work to be done, the path forward is clearer than it

was just a few years ago—and it’s heading in the right direction.