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UPDATE 1-U.S. foreign military sales fall slightly to $55.4 bln in 2019

(Adds detail on foreign military sales policy)

WASHINGTON, Oct 15 (Reuters) - Sales of U.S. military equipment to foreign governments fell slightly in the fiscal year ended Sept. 30 to $55.4 billion from $55.6 billion a year earlier, a U.S. official said on Tuesday.

Looser restrictions on sales under the Trump administration had increased foreign military sales by 33 percent from 2017 to 2018.

The Trump administration rolled out a new “Buy American” plan in 2018 that had relaxed restrictions on sales while encouraging U.S. officials to take a bigger role in increasing business overseas for the U.S. weapons industry.

There are two major ways foreign governments purchase arms from U.S. companies: direct commercial sales, negotiated between a government and a company; and foreign military sales, in which a foreign government typically contacts a Department of Defense official at the U.S. embassy in their capital. Both require approval by the U.S. government.

The largest U.S. arms contractors include Boeing Co, Lockheed Martin Corp, Raytheon Co, General Dynamics Corp and Northrop Grumman Corp. (Reporting by Mike Stone in Washington Editing by Nick Zieminski)