Satellite Controls

The Obama administration's export control reform initiative will gain a boost -- with respect to satellite controls and the notification requirements for the removal of items from the U.S. Munitions List (USML) -- from the final version of the fiscal year 2013 defense authorization bill that emerged from conference on Dec. 18, which Congress is expected to pass by the end of this week, Inside U.S. Trade reports this morning:

On satellites, the [National Defense Authorization Act] gives back to the president the authority to move all satellites and related items from the USML to the Commerce Control List (CCL), provided they are not exported, re-exported or transferred directly or indirectly to China, North Korea or any country listed as a state-sponsor of terrorism.

It also precludes any satellite or related item to be launched from any of these countries or as part of a launch vehicle owned by the governments of one of these countries. The president, however, can waive this prohibition on a case-by-case basis if he determines it is in the national interests of the U.S. to make the export and notifies the appropriate congressional committees about his determination.

Regarding the notification requirements, the final NDAA drops the language in the House version of the NDAA that would have required the administration to enumerate "to the extent practicable" the items it wants to move off the USML. The administration has long criticized this language as making it impossible to implement its overall export control reform initiative, and demanded that it be removed from the final NDAA bill.

The U.S. satellite industry supports the satellite language in the conference report, which was the result of negotiations that occurred among the administration and congressional staff in the House Foreign Affairs and Senate Foreign Relations Committees.

The legislation essentially repeals a provision in the NDAA for fiscal year 1999 that took the authority over satellite export control away from the president in the wake of a diversion scandal and returned all satellites and related items that had been transferred to the CCL back to the strict controls of the USML.

"Going back to the source and repealing [the 1999 NDAA] is a very clean way of doing it," said Patricia Cooper, president of the Satellite Industry Association.

Industry sources said this was a more desirable outcome than the House NDAA language, which tried to establish a new definition of which satellites and components the president could control. The House language referred to “commercial satellites and related components and technology” and defined them as communications satellites that do not contain classified components, including remote sensing satellites with performance parameters below thresholds identified on the USML. This language could have been interpreted to exclude authority over scientific, research and other types of satellites.

The language in the conference report gives the president nearly unrestricted authority over all satellites and related items, which are found in Category XV of the USML.

View the conference report.