ITAR Changes Could Increase Satellite Industry Export Challenges

New changes in the way that the U.S. controls satellite component exports may continue to hamper how the satellite communications industry does business internationally, as well as slow down military procurements.

In addition, officials at the U.S. Department of State are working through the proposed changes to the International Traffic in Arms Regulations (ITAR), which, according to a recent Aviation Week article, is a slow-moving process.  Much of this is due to restrictions on using the Chinese Long March rocket to launch satellites built with ITAR-controlled components.

As the article pointed out, Intelsat does not focus its efforts on China, even though prices for Long March launch vehicles are highly competitive. 

“We would feel comfortable launching some satellites on Chinese launch vehicles, but it is not an avenue we can pursue,” said Jean-Luc Froeliger, Vice President, Satellite Operations & Engineering at Intelsat, in the Aviation Week article.

In addition, the hosted payloads community has already voiced its concern about ITAR reform and how it could potentially put hosted payloads on ITAR lists – even if they are commercial in nature.  ITAR restrictions could go into effect for Department of Defense-funded secondary or hosted payloads.    

Many in the industry think that putting hosted payloads on a needlessly broad list is probably not what the drafters of ITAR intended. 

The Hosted Payloads Alliance (HPA) believes that the ITAR restrictions will impede the use and benefits of hosted payloads on commercial systems for non-DoD specific requirements.  This summer, the HPA sent comments to the State Department, which addressed these proposed changes and their unintended consequences.

HPA discussed how DoD-funded payloads that don’t have a military function should not be subjected to ITAR control, as well as how funding should not be the only criteria for ITAR control.  The organization also said that these restrictions are unnecessary because the existing ITAR clauses would be sufficient to control critical technologies funded by DoD.

In today’s challenging budgetary environment, these new reforms could hinder the military’s ability to best leverage hosted payloads for supporting mission goals and requirements.  We support the HPA’s stance and hope hosted payloads will be removed from ITAR munitions lists, which could impede the true benefit hosted payloads offer to the government customer.

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