Yesterday, the Department of Defense (DoD) released it’s Report to Congress – Section 1248 of the National Defense Authorization Act for Fiscal Year 2010 (Public Law 111 – 84): Risk Assessment of United States Space Export Control Policy, a report that was required by Section 1248 of the 2010 Defense Authorization Act. The report makes several recommendations that seek to balance national security goals with relaxing the burden on industry caused by the inclusion of space technologies on the International Traffic in Arms Regulations (ITAR).

The report recommends an approach that focuses on the risks associated with specific technologies, which differs from the broad blanket restrictions now in place that include satellite technologies as a whole on the United States Munitions List (USML). First, the report recommends that certain low-risk satellite technologies be moved from the USML to the Commerce Control List (CCL). Specifically:

- Communications satellites (COMSATs) that do not contain classified components;
- Remote sensing satellites with performance parameters below certain thresholds;
- and Systems, subsystems, parts and components associated with these satellites and with performance parameters below thresholds specified for items remaining on the USML.

The Report does not state that these technologies do not cause security risks if transfers occur. In fact, it states quite the opposite claiming that these technologies “can serve as the stepping stones to more advanced military space assets and operations.” However, the report goes on to say that “[b]ecause of the foreign availability, there is no benefit to U.S. national security from controls more stringent than those of the global community.” As a result one of the main claims is that protections granted under the CCL are sufficient to control these technologies and to ensure that national security interests are maintained. It does, however, state that satellite technologies that would be transferred should still be treated differently under the CCL. The CCL has a “presumption of approval for transfers to all countries,” and the report states that for space technologies this would change to a “presumptive denial for export or re-export of space-related items to any county prohibited to receive munitions exports under the ITAR, Section 126.1.” This would be coupled with a set of policies that seek to support U.S. Policy by requiring licenses for re-export of these technologies to countries of concern. At the same time the move to the CCL would relax controls on technology transfers to United States allies

Additionally, the report recommends that for satellite technologies that remain on the USML that the DoD be granted flexibility to apply Special Export Controls (SEC) based on assessed risk as opposed to the current mandatory requirement. SECs are enhanced export monitoring that applies to space technologies. It requires that monitors be present to guard against inadvertent and intentional exports. These monitors are DoD personnel, and in the case mandatory SECs, the cost must be reimbursed by industry (discretionary SECs – those determined to be needed by the DoD in non-mandatory cases – must be paid for by the DoD). The DoD seeks flexibility to determine whether a technology poses an actual security risk and to apply SECs only to those cases where there is a risk. As part of this recommendation, the DoD also wants to be able to seek reimbursement for all SECs that is determines are necessary.

The report, of course, notes that while the President has the ability to add and remove technologies from the USML, he is barred by law from doing this for the Category XV which covers space technologies. The report recommends that Congress adopt legislation to return this power back to the President as well as to give the DoD flexibility in applying SECs. The report then recommends that the executive branch take measures to move the suggested technologies to the CCL as well as to implement new rules governing these technologies on both the USML and the CCL.