Defense, State Say Some Satellite Export Controls Should Be Relaxed

The report also recommended that Congress return to the president authority to determine the export control jurisdictional status of satellites and related items.

DoD and DoS said maintaining non-critical satellites and related components on the USML and monitoring low-risk launch activities provide limited national security benefits. And this places the U.S. space industrial base at a distinct competitive disadvantage when bidding against companies from other advanced satellite-exporting countries that have less stringent export control policies and practices, they said.

Transferring select items from the USML to the CCL would allow for controls consistent with other technologies and would help enhance the competitiveness of the U.S. space industrial base, while continuing to protect U.S. national security needs, the report said.

The report said two satellite types, and related items, are not purely defense-related and thus should not be designated as defense articles on the USML or controlled under the International Traffic In Arms Regulations (ITAR) administered by DoS. These satellites and related items do not contain technologies unique to the U.S. military industrial base nor are they critical to national security, the report said. As a result, the report said the items would more appropriately be designated as dual-use items on the Commerce Control List (CCL) and controlled under the Export Administration Regulations (EAR), including:

• Communications satellites that don't contain classified components.
• Remote sensing satellites with performance parameters below certain thresholds.
• Systems, subsystems, parts and components associated with those satellites and with performance parameters below thresholds specified for items remaining on the USML.

The report said the U.S. and other space-faring nations have satellites far more capable than those identified as dual-use, though dual-use satellites and related items, can be used by countries with less experience and expertise in space to generate basic, initial military communications, remote sensing assets, and satellite jamming capabilities.

But the report said the Departments agreed as long as the CCL includes adequate protections that the transfer of items from the USML would not contribute to the improvement of foreign military capabilities that could harm regional and international security and stability, and would not be diverted to support such capabilities. They said the risks can be mitigated by transferring jurisdiction over their export licensing to the CCL.

"This in-depth report shows that the United States can safely modify the export controls placed on satellites and related component technology that are widely available, while maintaining firm control on systems and technologies deemed truly critical to national security," said Acting Under Secretary of Defense for Policy, Jim Miller. "The steps recommended are fully consistent with the administration's broader export control reform efforts, which aim to build higher fences around fewer items."

(Space-related items are the only dual-use items that are required by law to be controlled as defense articles. For all other items with export controls, the President has, consistent with the Arms Export Control Act, the authority to determine whether the controls of the ITAR, administered by the State Department, or of the EAR, administered by the Commerce Department, should govern.)

But the Departments' review confirmed the continued need for other space-related items to remain on the USML because they and related services contain critical components and technologies and the implicit expertise to create and use them that give the U.S. a military or intelligence advantage in space, including:

• Satellites that perform a purely military or intelligence mission.
• Remote sensing satellites with high performance parameters.
• Systems, subsystems, parts and components unique to the above satellite types and not common to dual-use satellites.
• Services in support of foreign launch operations for USML and CCL designated satellites.

The White House, in its own fact sheet (here), said:

• Over the past 15 years, a substantial number of commercial satellite systems, subsystems, components, and related technologies have become less critical to national security due to the transition from military to predominantly civilian uses.
• Export of space-related items to our allies and closest partners presents a low risk to national security.
• The U.S. should maintain strict controls on transfers of non-critical space-related items to end users and for end uses that are likely to be used against U.S. national interests.
• USML Special Export Controls (SECs) remain necessary to mitigate against the substantial risks associated with the following services: satellite failures and anomaly resolution; launch know-how; launch services; and launch failure analysis.
• Implementing the recommendations would synchronize the Department of State and the Department of Commerce’s licensing policies, ensuring continued effective implementation of prohibitions to end-users and end-uses of concern.

The Aerospace Industries Association said the report gives decisionmakers in Congress "crucial information" on how reform can strengthen both our national security and space industrial base. It cited its recent report, Competing for Space: Satellite Export Policy and U.S. National Security (here) that it said outlines the devastating impact the "draconian" controls have had on the U.S. space industrial base.

"We estimate that U.S. manufacturers lost $21 billion in satellite revenue from 1999 to 2009, costing about 9,000 direct jobs annually," AIA said in a statement. "AIA urges Congress to move quickly on the recommendations to strengthen the U.S. space industrial base."