[SatNews] The U.S. Commerce Department’s Bureau of Industry and Security (“BIS”) and the U.S. State Department’s Directorate of Defense Trade Controls (“DDTC) recently published final rules to move most civil and commercial satellites and components from the U.S. Munitions List (“USML”) to the Commerce Control List (“CCL”).
 
These final rules represent important progress in ongoing efforts to reform export controls and remove unnecessarily restricted items from International Traffic in Arms Regulations (“ITAR”) control. These changes were advocated by the satellite industry for years and were authorized by Congress and the President in late 2012 and early 2013.
 
According to Under Secretary for Industry and Security for the United States Department of Commerce, Eric L. Hirschhorn, in a speech given in 2013 in Colorado Springs, Colorado, the changes will affect four items, “Items transferred include, certain commercial communication satellites and lower performing remote sensing satellites; ground control systems and training simulators "specially designed" for telemetry, tracking and control of spacecraft controlled in 9A515; radiation hardened microelectronics formerly controlled in Category XV of the ITAR; and parts and components of satellite bus and payloads not listed on the USML.”
 
Prior to this statutory shift, all satellites were controlled under the ITAR including those for commercial, research, and communications purposes. Moving these items to the CCL makes them eligible for less restrictive licensing including some license exceptions under the Export Administration Regulations (“EAR”).  However, some items will be subject to more restrictions including special rules for exports to China and foreign-made items that incorporate US-origin components.
 
The final rules went into effect on November 10, 2014. U.S. producers and exporters of satellites and satellite components as well as others in the industry should be aware of this altered regulatory environment and related compliance obligations that may impact their business.

Story by Shih-Kuei Chen, LLM, Blakely & Justice, Longmont, Colorado