The Obama administration is proposing to relax export controls for U.S. satellite technologies to allow domestic companies to be more competitive in the global marketplace while at the same time allowing for stricter restrictions against countries including China, Iran, North Korea and Syria.
In a new report to Congress, the administration proposes that communications satellites and remote-sensing spacecraft that lack classified components or capabilities exceeding certain thresholds be available for sale abroad. This relief to the Internal Traffic in Arms Regulations (ITAR) also would pertain to the subsystem and parts on theses satellites, said Greg Schulte, deputy assistant secretary of defense for space policy, during a press conference at the National Space Symposium here April 18. The regulations would be relaxed on these parts by transferring them from the U.S. Munitions List, which has complex oversight requirements, to a more flexible Commerce Control List.
This comes as a relief to companies that have long complained that the restrictions put them at a disadvantage against foreign competitors. Underscoring this issue was a savvy marketing campaign from a foreign manufacturer boasting to build an “ITAR-free” satellite. The hope, with the proposed regulatory changes, Schulte says, is that “the ITAR-free label would become irrelevant.”
These changes must first be approved by Congress. But pressure will be on lawmakers to begin examining the proposal as companies grow increasingly concerned about diminished defense and intelligence spending amid the growing national deficit.
Lou Ann McFadden, chief of strategic issues for the Defense Technology Security Administration, says the new regulations, if enacted, would allow enforcement agencies to focus their efforts more efficiently. “We are forced into monitoring these same people over and over,” she says of some companies that repeatedly use foreign launchers, as an example, and have to repeat arduous oversight processes. More important, she says, is for the enforcement arm of the government to focus on new companies working under the regulations, or bad actors.
While providing some relief, the proposed regulatory changes are designed to put more restrictions on the transfer of critical technologies to nations including China, Iran and Syria.
Under current guidelines, a foreign end item — such as a Chinese satellite — must contain less than 25% U.S. content. Now any U.S. part that makes its way into a Chinese satellite would be a breach of these proposed regulatory changes, McFadden says. Additionally, there would be a presumptive denial of any satellite export license request for countries on the forbidden list, she says.