78 STAT. ]
PUBLIC LAW 88-633-OCT. 7, 1964
1011
PART II CHAPTER 2—MILITARY ASSISTANCE
SEC. 201. Chapter 2 of part II of the Foreign Assistance Act of 1961, as amended, which relates to military assistance, is amended as follows: 435. (a) Amend section 503, which relates to general authority, as 75 Stat. 2311. 22 USC follows: (1) In subsection (c) strike out "and" at the end thereof and in subsection (d) strike out the period at the end thereof and substitute "; and". (2) Add the following new subsection (e): "(e) guarantying, insuring, coinsuring, and reinsuring any individual, corporation, partnership, or other association doing business in the United States against political and credit risks of nonpayment arising in connection with credit sales financed by such individual, corporation, partnership or other association for defense articles and defense services procured in the United States by such friendly country or international organization." (b) Amend section 504(a), which relates to authorization, by 11 flic ^^\^ striking out "1964" and "$1,000,000,000" and substituting "1965" and "$1,055,000,000", respectively, and by adding at the end thereof the following new sentence: "Of the funds made available for the fiscal ^^^f^l^^ ^° Congress. year 1965 to carry out the purposes of this part, not less than $200,000,000 shall be available solely for use in Vietnam, unless the President determines otherwise and promptly reports such determination to the Committees on Foreign Relations and Appropriations of the Senate and to the Speaker of the House of Representatives.". 75 Stat. 437. (c) Amend section 507(b), which relates to sales, by inserting 22 USC 2315. after "are due" at the end of the first sentence the following: ": Provided, That the President may, when he determines it to be in the national interest, accept a dependable undertaking to make full payment within one hundred and twenty days after delivery of the defense articles, or the rendering of the defense services, and appropriations available to the Department of Defense may be used to meet the payments required by the contracts and shall be reimbursed by the amounts subsequently received from the country or international organization". (d) Amend section 509, which relates to exchanges, as follows: 22 USC 2317 (1) The section heading is amended to read as follows: "EXCHANGES AND GUARANTIES".
(2) After the section heading insert " (a) ". (3) Add the following new subsection (b): " (b) I n issuing guaranties, insurance, coinsurance, and reinsurance, the President may enter into contracts with exporters, insurance companies, financial institutions, or others, or groups thereof, and where appropriate may employ any of the same to act as agent in the issuance and servicing of such guaranties, insurance, coinsurance, and reinsurance, and the adjustment of claims arising thereunder. Fees and premiums shall be charged in connection with contracts of guaranty, insurance, coinsurance, and reinsurance. Obligations shall be recorded against the funds available for credit sales under this part in an amount not less than 25 per centum of the contractual liability related to any guaranty, insurance, coinsurance, and reinsurance issued pursuant to this part and the funds so obligated together with fees and premiums shall constitute a single reserve for the payment of claims under such contracts. Any guaranties, insurance, coinsur-
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