On January 2, 2013, President Obama signed the National Defense Authorization Act for Fiscal Year 2013, which, in relevant part, authorizes the Administration to ease export restrictions on satellites and related products. Our entry of November 30, 2012, addressed the efforts underway to ease export controls on a variety of sensitive technologies and products, emphasizing that restrictions on satellite exports could not be eased without new legislation. Section 1261 of the new law removed the legislative mandate that satellite exports be controlled under the International Traffic in Arms Regulations (“ITAR”). The Administration is now in a position to propose rules that would shift jurisdiction over satellite product exports to the more flexible Export Administration Regulations (“EAR”).
The new legislation did, however, impose a few notable restrictions. They include a prohibition on exporting satellites and related products to China, North Korea or state sponsors of terrorism. The president may waive this prohibition under certain conditions. The legislation also establishes a presumption of denial for any application to export satellites or related products to a country subject to an arms embargo.
The Administration has been moving quickly in proposing rules to shift jurisdiction over the export of a wide variety of products from the ITAR to the EAR. We will likely see a comparable proposal for satellite exports in the not-too-distant future.