The lack of a legal framework governing the arms trade is allowing weapons to reach states under embargo like Sudan and Uganda, a report says.
Military hardware kills 300,000 people a year, the report says
The Arms Without Borders report by leading humanitarian groups, including Oxfam and Amnesty International, is calling for a global arms trade treaty.
It compares European and North American firms to flat-pack stores, selling arms in pieces for assembly "back home".
And unscrupulous arms dealers can, it says, get around national restrictions.
The report was drawn up Oxfam and Amnesty along with the International Action Network on Small Arms, which together have formed a campaigning coalition called Control Arms.
Its launch on Monday was timed to coincide with the opening in New York of a session of the UN General Assembly's First Committee - one of the UN's main forums on disarmament.
"This report reveals a litany of loopholes and destroyed lives," said Oxfam International director Jeremy Hobbs.
"Arms companies are global yet arms regulations are not, and the result is the arming of abusive regimes."
According to the report's findings
- The US, Russia, the UK, France and Germany remain the world's top arms exporters, accounting for about 82% of the market in 2005
- Newer arms producers like Brazil, China and Israel have varying export controls which "do not always include explicit criteria... for authorising arms transfers"
- Military essentials such as engines and electronics often do not appear on exporters' lists of sensitive technologies
'Litany of loopholes'
Amnesty International's director-general, Irene Kahn, said the legislation concerning the arms trade was so outdated that the sale of soldiers' helmets was "better regulated than the sale of components that can be made into deadly weapons".
The report says weapons such as attack helicopters and combat lorries are being assembled under licence in countries including China, Egypt, Israel and Turkey.
It alleges that such weapons have gone to Sudan, Colombia and Uzbekistan, and it says it has received reports that they have been used against civilians.
One of the companies named in the report is British-based BAE Systems.
It has responded by saying that it works closely with the UK and US governments on export sales, and it is up to governments to decide whether to grant export licences.