ITAR Dilemma: Finding The Balance Between Regulation And Profit

 

Some Headway

The State Department sees no drag on the U.S. space industry and insists  that the security benefit to the nation is something that businesses must bear, but industry as a whole .continues to refute this belief. “The primary issue that has been dragging down the industry and giving ITAR a bad name is the [State Department], which has simply failed to implement National Space Policy as articulated in [the Department of Commerce’s] Department of Space Commerce; namely that it is in the interest of the United States to foster the use of U.S. commercial space capabilities around the globe and to enable a dynamic, domestic commercial space sector,” says Dave Payne, a space, satellite and networking technology consultant based in Silicon Valley.  ITAR management should be returned to the [Commerce Department] or should be staffed at the [Department of State] with space professionals with backgrounds in space business and not by career State Department personnel. How can these career unionized bureaucrats recognize leapfrog technology advances afforded by cross component synergies on an architectural level?”

The U.S. government has made some allowances in the ITAR battle. In January, President Bush signed a package of directives to reform U.S. defense trade policies and practices. According to a fact sheet released by the U.S. Department of State, “the package of reforms required under this directive will improve the manner in which the U.S. Department of State licenses the export of defense equipment, services and technical data, enabling the U.S. government to respond more expeditiously to the military equipment needs of our friends, allies and particularly our coalition partners.”

While ITAR was not specifically mentioned, the State Department fact sheet could be seen as a foot in the door, says Remy Nathan, director of international affairs at the Aerospace Industries Association. “When it comes to satellite components manufacturers, I would argue that to the extent that they are dealing with items that are munitions list items, they will benefit just like everyone else with the ability to get these licenses processed in a more predictable, efficient and transparent manner,” he says. “I’m encouraged by the fact that the State Department singled out for attention the commodity jurisdiction process and talked about how they’re going to try to take steps to ensure effectiveness and efficiency. That potentially creates the opportunity to evaluate that mechanism and make sure it’s functioning appropriately to balance out the consistent needs of U.S. national security and economic and competitive imperatives. If you make sure it’s working right, then you might be able to feed in thornier issues that we’ve had in the past and see what comes out.”

Conclusion

A shift may be taking place in the thinking of some in the government on the business impact of ITAR, as the U.S. technology dominance is being threatened, but there does not yet  appear to be a real joint effort to balance the objectives of national security and the goal of maintaining U.S. superiority in sensitive dual-use. 

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