Why doesn't the "Ukraine Democracy Defense Lend-Lease Act of 2022" exclude repayment explicitly?

Question

It is widely stated that "Ukraine Democracy Defense Lend-Lease Act of 2022" exempts Ukraine from paying back for military aid, e.g.

Under the current American law . . . makes the recipient country fully financially liable for any costs incurred, including reimbursement for the damaged or destroyed items. The Ukraine Democracy Defense Lend-Lease Act of 2022 exempts Ukraine and neighbouring countries from these and several other requirements link

But above-mentioned act has only the following:

(2) EXCLUSIONS. . . .

(A) Section 503(b)(3) of the Foreign Assistance Act of 1961 (22 U.S.C. 2311(b)(3)).

(B) Section 61 of the Arms Export Control Act (22 U.S.C. 2796).

So it excludes item 3 of Foreign Assistance Act but not 503(b)(5) that says that aid has to be repaid.

(5) the loan agreement provides that

(A) if the defense article is damaged while on loan, the country or international organization to which it was loaned will reimburse the United States for the cost of restoring or replacing the defense article, and

(B) if the defense article is lost or destroyed while on loan, the country or international organization to which it was loaned will pay to the United States an amount equal to the replacement cost (less any depreciation in the value) of the defense article.

Is that a mistake or will Ukraine actually have to pay back, or does 503(b)(5) not apply here because of some technical legal exception?

Answer 1

Q: Why doesn't the "Ukraine Democracy Defense Lend-Lease Act of 2022" exclude repayment explicitly?

Unknown, but likely the method used was provided by legal counsel.

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Only eight bills in the past 40+ years have referenced "Section 503(b)(3) of the Foreign Assistance Act of 1961". All were introduced in 2022. In the table below, only the first bill (S. 3522) became law. None have made reference to Section 503(b)(5).

There was no report from any committee for any of these bills, nor any mention in the Congressional record of Section 503(b)(5). Absent a report, discussion, or any explanation in the bills themselves, one may only surmise that a request was made of Congressional legal counsel for a means of getting around the restrictions without changing the existing law. Their solution then was to exclude the five year limit for lending in Section 503(b)(3) and the need for an agreement to repay in Section 61 of the Arms Export Control Act – "Since Ukraine never agreed to pay, and with no time limit for the use of the equipment, we cannot require they pay for or return the equipment at a later date".

Note that four of the bills were introduced prior to the beginning of the "special military operation" and that the two most recent bills refer to Taiwan.

Legislation Number	Title	Date of Introduction
S. 3522	Ukraine Democracy Defense Lend-Lease Act of 2022	01/19/2022
H.R. 6742	Never Yielding Europe’s Territory (NYET) Act of 2022	02/15/2022
S. 3652	Never Yielding Europe’s Territory (NYET) Act of 2022	02/15/2022
H.R. 6753	Ukraine Democracy Defense Lend-Lease Act of 2022	02/18/2022
H.R. 6876	Ukraine Democracy Defense Lend-Lease Act of 2022	02/28/2022
H.R. 7611	Ukraine Democracy Defense Lend-Lease Act of 2022	04/27/2022
S. 4652	Taiwan Democracy Defense Lend-Lease Act of 2022	07/28/2022
H.R. 8631	Taiwan Democracy Defense Lend-Lease Act of 2022	07/29/2022