Trade Law Daily is a Warren News publication.

In Comments, Companies Warn of Export Reform Harm to Fledgling Commercial Space Industry

A handful of commercial spacecraft companies praised proposed changes to Category IV of the U.S. Munitions List, but warned against too-broad definitions and too-strict Missile Technology Control Regime guidelines, in public comments released March 26. The proposed changes are part of President Obama’s Export Reform Initiative. The comments were submitted to the State Department’s Directorate of Defense Trade Controls on specific changes to Category IV, which includes launch vehicles, guided and ballistic missiles, rockets, torpedoes, bombs and mines (read the proposed rule here).

Sign up for a free preview to unlock the rest of this article

Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.

New York-based Virgin Galactic, LLC, said the U.S. government and multilateral partners should “commence a serious discourse on how to modernize export controls” to address the growing private spaceflight industry. “Specific actions that could be taken include removing the presumption of denial for the export of manned spacecraft vehicles with integrated propulsion systems,” the company said. “An important element of this reform effort would be to clearly define the export classification of these types of commercial spacecraft vehicles under USML Category XV, or better yet, create a new home for them on the Commerce Control List.”

The Aerospace Industries Association agreed that the “presumption of denial” should be removed, while the Commercial Spaceflight Federation argued the proposed “specially designed definition” is too broad. “This unnecessarily burdens many of our innovative companies and greatly increases USML compliance costs,” the group said in comments. “Since many of the commercial companies in this nascent industry are still relatively small, the effort entailed to ensure compliance would have a serious adverse effect on their business and could potentially prevent sales to customers from allied foreign nations.”