By Keil J. Ritterpusch, Esq., Senior Associate, FD Associates, Inc.
In February 2015, the U.S. Department of State announced a “new policy” pertaining to the export of military drones, that a number of news outlets have hailed as a lifting of restrictions on the export of military, armed drones – referred to by industry as Unmanned Aircraft Systems (“UAS”). Concurrent with the Department of State release of its policy, the U.S. Department of Commerce signaled the near-term publication of regulatory changes in the Export Administration Regulations (“EAR”) regarding the export licensing of small non-military UAS. The two announcements are part of an overall Obama Administration policy to regulate the export of UAS in a manner consistent with national security objectives, without over-regulating UAS that are less-sensitive.
The Department of State policy announcement was widely distributed, being posted on the State Department website on February 17, 2015 (http://www.state.gov/r/pa/prs/ps/2015/02/237541.htm), and followed up with an off-the-record conference call with various State Department stakeholders and invited US industry on February 18. Meanwhile, the Department of Commerce announcement was made at an export controls conference held by the Association for Unmanned Systems International (“AUVSI”) on the same day.
Both policy changes announced by the Obama Administration have been highlighted by the media as a lessening of export controls on UAS. However, the Department of Commerce’s informally announced regulatory change is the only UAS policy modification that will likely result in a reduction in exporting requirements.
Department of State UAS Policy
Examining the specific language in the Department of State fact sheet on the “new” UAS policy, it is clear that the policy truly amounts to an increase in the regulatory requirements for the export of military UAS, not a decrease or a signal that armed UAS will be easier to sell in the international marketplace by US firms. Specifically, the new UAS policy requires that: “sales and transfers of sensitive systems [shall] be made through the government-to-government Foreign Military Sales program”. Armed Reapers were already approved for export to the United Kingdom and sales of sensitive military UAS to other allies in Europe have likewise been approved recently. So, the approval for the export of military UAS is not new. However, the fact that “sensitive systems” will only be exportable under the FMS program is new.
In addition to the FMS requirement for the sale of armed UAS and sensitive systems, the fact sheet further provides that “each recipient nation [shall] be required to agree to end-use assurances as a condition of sale or transfer”, whether the military UAV is for use for military purposes or not. Also, “end-use monitoring and potential additional security conditions [shall] be required”. The final piece of the new UAS export policy requires end users to expressly agree in writing to “principles for proper use” of military UAS.
The fact sheet offers the following guidelines regarding the “proper use” of military UASs:
- “Recipients are to use these systems in accordance with international law, including international humanitarian law and international human rights law, as applicable”;
- “Armed and other advanced UAS are to be used in operations involving the use of force only when there is a lawful basis for use of force under international law, such as national self-defense”;
- “Recipients are not to use military UAS to conduct unlawful surveillance or use unlawful force against their domestic populations”; and
- “As appropriate, recipients shall provide UAS operators technical and doctrinal training on the use of these systems to reduce the risk of unintended injury or damage”.
While obtaining end user assurances of “proper use” should be a straight-forward process enforcing the actual “proper use” of military UAS will be a very difficult thing to accomplish.
Department of Commerce UAS Regulatory Changes
At the AUVSI conference on February 17, the Department of Commerce advised attendees that it will be revising its regulations in the near term in order to reflect changes in the Waasenaar Arrangement – a multilateral missile control regime agreed to by its 41 member nations, including the U.S. – that were agreed in December 2014 by Waasenaar member nations. Specifically, in December the Waasenaar members agreed to liberalize restrictions on commercial UAS in recognition of the proliferation of drone technology and the over-control of small drones.
Per the Department of Commerce officials at the AUVSI conference, the ECCN 9A012 of EAR will be revised to lessen the reach of this ECCN, which currently covers the export of all non-military UAS that have autonomous flight control capability or the ability to fly outside the line of sight of a human operator. ECCN 9A012 requires a license for the export of all such UAS to every country except Canada. The way that 9A012 is currently written, even hobbyist and toy UAS are captured if the UAS has autonomous flight control or the ability to fly beyond an individual’s light of sight.
The proposed ECCN 9A012 revision will clarify that non-military UAS with a flight endurance of less than 30 minutes are not controlled. Furthermore, Commercial UAS with a flight endurance between 30 minutes and an hour will only be subject to an export license requirement if the units can fly in wind gusts of 25 knots or greater. Non-military UAS with the capability of flight for one hour or more will remain subject to licensing requirements currently in place under ECCN 9A012.
Implications for the Future of UAS Exports
Although it is not directly addressed in the Obama Administration’s new UAS export policy directly, whether in the fact sheet or in public statements made by US Government officials, FD Associates believes that the strengthening of controls on the export of military UAS and the loosening of controls on the export of small, less capable non-military UAS signals a policy shift that is aimed at applying the “right” controls on UAS technology based on the analysis of real national security concerns posed by the proliferation of UAS technology worldwide. We feel that the current regulatory and policy changes when coupled with Export Control Reform open the window for companies to file Commodity Jurisdiction (“CJ”) cases to move the control of their unarmed, “military”–capable UAS from the ITAR to the EAR.
We are disappointed that the new policies do not address the major ambiguity in the ITAR due to the lack of a definition of “military” UAS. As the new policies are apparently aimed at the “right” controls being placed on UAS exports, it would have been an apt time for the U.S. Government to address the ambiguity. This ambiguity was addressed in the DTAG plenary session in 2014 by key UAS stakeholders, and DDTC has advised the stakeholders to file CJs. Now that the Department of State is requiring end user certifications of “proper use”, nation state assurances regarding end use, and end use monitoring, it is a good time for UAS manufacturers to file CJs regarding their UAS that do not contain sensitive military communications, military tracking or telemetry information, or ITAR sensors unless these components can be replaced with commercial equivalent. Many dual-use UAS have been traditionally captured as unarmed “military” UAS on the ITAR due to their extensive use in military applications, rather than their particular functionality.