The Obama administration is proposing to shift tanks, trucks and other military vehicles currently controlled on the U.S. Munitions List (USML) to the less-restrictive U.S. Commerce Control List (CCL) by year’s end as part of a broader effort to reform the U.S. arms export licensing process.

The licensing process governs foreign sales of sensitive U.S. technologies to other countries, including commercial communications satellites. Under a proposed federal rule issued July 15, the Commerce Department would implement a new regulatory framework for the transfer of defense articles that the president determines no longer warrant control under the Arms Export Control Act, which governs the State Department-administered USML.

As a first step, a rewrite of an initial tranche of items — U.S. tanks, trucks and other military vehicles contained within Category VII of the USML — is to be complete by year’s end, according to a senior administration official.

“We anticipate that later this year the Department of State will issue a final version of Category VII” of the USML, which controls military tanks and trucks, said Eric Hirschorn, undersecretary of commerce for the department’s Bureau of Industry and Security, who spoke July 19 during an export control conference here. Hirschorn says the overhaul of Category VII would be followed by proposed modifications to other USML categories that control the export of naval ships, aircraft and electronics. The plan is to have nearly all categories revised and in final form “well before the end of next year,” he says.

In addition, under the proposed rule, exports of technologies with low or no military or intelligence sensitivity would, in some instances, be eligible for more flexible Commerce license exemptions; and end-items, parts and components that are not “specially designed” for military use would be subject to the same export control requirements as their commercial market equivalents. Public comments on the proposed rule are due by Sept. 13.

Marion Blakey, president of the Aerospace Industries Association, welcomed the administration’s proposed changes to the export licensing system.

“For years the U.S. export control system has created confusion and delay in exporting defense equipment to our allies and driven up compliance costs across the industrial base,” she said in a statement. “These reforms are common-sense ways of supporting our military partners and our export competitiveness.”

Since August 2009, when the White House announced plans to reform the nation’s cumbersome and antiquated export licensing system, the administration has been busy laying the groundwork for reform, Hirschorn says. As the reform effort inches ahead, Congress will need to weigh in, possibly before the end of this year if the administration’s rewrite of Category VII remains on track. Specifically, Congress must be notified of each item proposed for removal, and the administration must wait 30 days before the items can be removed, a legal protocol that could slow the reform process as the administration seeks to shift hundreds, if not thousands, of military articles, parts and components from State to Commerce jurisdiction.

“When they come to us with hundreds and hundreds and hundreds of things to take off the list, to put on the CCL, that’s where it’s going to be very interesting,” one congressional aide says, warning that national security watchdogs on Capitol Hill will want time to review and carefully consider the administration’s proposals. “If they try to take a bulldozer approach to things, there are going to be problems.”

President Barack Obama also will need congressional backing to ease restrictions on exports of U.S. communications satellites, which were shifted from Commerce to State department control in the late 1990s when lawmakers learned that Beijing was benefitting militarily from launches of U.S. spacecraft aboard Chinese rockets.

However, White House Chief of Staff William Daley says the administration has been quietly working with Capitol Hill to prepare for statutory changes necessary to return communications satellites to Commerce Department jurisdiction.

“One sector we have not heard a lot about is the commercial satellites,” Daley said at the conference. “We will work with Congress to provide the national security assurances which are necessary to safely normalize our controls on commercial satellites.”