ITAR Satellite Revisions... Thoughts

ISSUE

Obama, for all of his deficiencies or lack thereof (depending on your persuasion) in his political life as POTUS, has had the common sense to ensure that we get a revision of a part of the ITAR- or the International Traffic in Arms Regulations- that is in sore need of overhaul.  As part of his effort in the Export Controls Reform arena, Category XV of the US Munitions List ("USML"), is getting a serious tune-up.  I have written this post not only to explain to those of you who have absolutely no idea what I am talking about why these revisions are a godsend to those in the business of using satellites (Telecom, Media and Technology people will sympathize here) but also as a friendly reminder for any and all attorneys out there who have been sitting on their hands about sending in a revision suggestion- you have two weeks left to get it done (the call for input remains open until July 8th, 2013).

Nitty-Gritty

Last updated in 1999, as part of the Strom Thurmond National Defense Authorization Act, Category XV of ITAR (cited 22 C.F.R. § 121.1 XV) is focused on clearance for use of everything related to satellites.  While the call for revisions do seem to still hope to regulate satellites that can launch ICBM's, send death rays down to pinpointed locations on the earth a la  James Bond weaponry in Diamonds Are Forever and GoldenEye,  these general call seems to acknowledge that your standard satellite is more likely to be used for Google Maps, your cell phone call to your supplier in Rotterdam or to allow your Garmin to help you escape Jersey Turnpike Friday traffic rather than cutting edge technology that can can negate U.S. defensive capabilities.

Limitations still seem to include satellites that can:

1. Assemble, refuel or otherwise aid in outer orbit transit
2. Move faster than gravitational pull allows (If your satellite is volitionally moving faster than 9.8m/s^2, its probably more likely a missile or an object that can do harm. If its not volitional, well then we have a meteor and you have probably just suffered a multimillion dollar balance sheet hit on your PP&E)
3. Has some capability (examples include kinetic, radio-frequency, laser charged particle device or "directed energy") to destroy or attack other satellites or something on the ground. I will be honest, when I read this part of the USML I think "Someone read too much Assimov as a kid" and "You know that there is probably some science we can't comprehend or left off that gets around technical restrictions of the USML but not the spirit"
4. There are more, but those are the "fun" part of the list.

Remember- all these Satellites have to be pointed towards the earth. If you want to send a satellite to orbit Mars, it's not considered SME (Significant Military Equipment) and escapes all the ITAR hulabaloo (See note 3 to paragraph (a)(7)).


Take-Away Practitioners

- If you deal with ITAR and the DDTC on a regular basis regarding Category XV,  chances are you can now get your Technical Assistance Agreements, Manufacturing License Agreements, or Warehouse Distributions Agreements cleared out of the defense controls and into the relatively lower hassle realm of commercial export.

- July 8, 2013 is the deadline for revisions for Category XV of ITAR. If you think that there is something wrong with this part of the Munitions List, read through the call to change I linked to in the intro, and then make sure you get it in before the deadline (you have 16 days).

-If you don't deal with satellites (or the programs that run them or the component parts), then be thankful that haven't had to deal with something that was last updated when cell phones were as big as our faces (regrettably we may be heading back that way, but I digress).

-Lastly, this is about the 4th part of ITAR where there has been call to change this year (don't quote me on the number, but it seems to be a new category or chapter ever 2-3 months). So even if you are not dealing with Category XV but you are instead dealing with ITAR on a regular basis, please please please please check to see if there has been a new call for reform on your particular area. The DDTC isn't running through this in numerical order, so the part that affects your trade could be up next. Also side note- If the DDTC went through a revision in the past 2 or 3 years on a chapter that affects you, you can expect it to be a while before another overhaul.