An act to amend title 10, United States Code, to authorize the Secretary of Defense to enter into certain agreements to further the readiness of the military forces of the North Atlantic Treaty Organization.

(Measure passed House, amended)

North Atlantic Treaty Organization Mutual Support Act of 1979 - Authorizes the Secretary of Defense to acquire logistic support, supplies, and services for U.S. Armed Forces deployed in Europe from the other North Atlantic Treaty Organization (NATO) countries. Permits the Secretary, after consulting with the Secretary of State, to enter into cross-servicing agreements with any NATO country under which the United States will provide support, supplies, and services to military forces of such country and in return such country will provide the same to U.S. Armed Forces. Stipulates that such acquisitions and agreements are subject to: (1) the procurement provisions applicable to the U.S. Armed Forces; and (2) the availability of appropriations. Exempts such acquisitions and agreements from other specified statutory provisions.

Stipulates that the acquisition or transfer of such support, supplies, and services be on a reimbursement basis or by replacement-in-kind (including exchanges).

Directs the Secretary to negotiate for specified pricing principles for reciprocal application in agreements for the acquisition or transfer of support, supplies, and services on a reimbursement basis. Sets forth an alternative provision if the Secretary is unable to obtain a mutual acceptance of such pricing principles.

Requires direct payments to the supplier every three months by the recipient of such support, supplies, and services in order to liquidate any credits and liabilities accrued by the United States. Credits any receipts of the United States to the applicable appropriations, accounts, and funds of the Department of Defense. Sets ceilings on the total amount of liabilities and credit that may be accrued by the United States, except during a period of active hostilities involving NATO.

Prohibits increasing the inventories of supplies for the armed forces for the purpose of transferring supplies.

Directs the Secretary to report annually to Congress concerning: (1) agreements entered into pursuant to this Act; and (2) the value of reimbursable and nonreimbursable acquisitions and transfers of support, services, and supplies.