New Export Rules Will Be Looser, More Complicated

Capitol Building
The good news is that the U.S. government is about to loosen the restrictive export rules governing satellites and components that have been blamed for destroying America’s dominance in the satellite market over the past 15 years.

The bad news is that the rules are about to get a lot more complicated to interpret. And, for those who fail to interpret them properly, a jail cell could be in their future.

The current rules are similar to “1+1=2,” while the new ones will be akin to “i before e except after c,” says Sam Black, the director of policy for the Satellite Industry Association. He made his remarks during a panel discussion on export reform last week at the Space Tech Expo in Long Beach, Calif.

Mark Jaso, who works on export control issues for the U.S. Commerce Department, said a 30-day informal review of the proposed rule changes ends this week. This will be followed by a formal 30-day review before the publication of final rules in early May.

Black said that after the rules are published, there will be a 180-day implementation period before the rules take effect. During this period, companies will need to figure out exactly how the new regulations apply to their technology exports.

The revisions will largely impact commercial satellites and their components. Payloads funded by the Defense Department would remain under the most restrictive rules, Black said.

Ball Aerospace Vice President Debra Facktor Lepore said that companies will likely be conservative in interpreting the new rules because if they violate them, employees could end up in jail.

Facktor Lepore added that export reform is badly needed to keep U.S. industry competitive during a time of shrinking government funding and strong competitors overseas.

Frank Slazer, vice president of space systems for the Aerospace Industries Association, said it’s difficult to gauge just how much the new rules will benefit U.S. industry due to improved competition aboard.

John Ordway, a partner in the law firm of Berliner, Corcoran & Rowe LLP, said secondary payloads funded by the Defense Department as well as satellite serving system would remain under the strictest export rules.

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