It supports tags, a feature where you can dynamically attach entities onto vector points. OA uses this to make independently turning torsos and heads on most characters, as well as placing the weapon in the hands, animating a static weapon model, and showing a muzzleflash.
Another software capable of working with MD3 models should be Misfit Model 3D (which has got "beta" MD3 support in its "development version"). Misfit Model 3D is no longer under development, hence its MD3 support will never reach the "stable" label. Although it may not provide enough animation control for player models, it should be fine at least for static models (mapmodels to be baked into maps).
Since Misfit Model 3D has been halted, another developer forked the project, creating Maverick Model 3D and continuing the development. It has got improved MD3 support, there is a manual page about it here.
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