WHITE HOUSE PONDERS FATE OF SATELLITE LICENSING
No decision has been made by White House whether to allow State Dept. to keep jurisdiction over U.S. satellite exports, industry sources said. Representatives of Dept. of Defense (DoD), State Dept. and Commerce Dept. met at White House Tues. to discuss fate of satellite exports, but no details about outcome of meeting were available by our deadline. Satellite licensing was transferred to State from Commerce 3 years ago in 1998 Defense Authorization Act after 2 U.S. companies were accused of transferring secret satellite technology to Chinese. State Dept. had no comment on meeting. Satellite Industry Assn. (SIA) Exec. Dir. Richard Dalbello said: “Congress has gridlocked on this issue and they are waiting for the White House to decide it.”
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Bush Administration is attempting “balancing act” to satisfy military concerns while maintaining commercial interests, satellite official told us. “Everybody knows the new rules have hurt satellite companies and cost the industry millions of dollars. Everybody is trying to figure out how to bow out gracefully. This is a political juggernaut.” Dalbello said meeting would help Congress and Administration “develop a clear position” on commercial satellite licensing. “The issue has reached a critical juncture.” Dalbello, whose group includes satellite makers, said transfer of oversight to State from Commerce had hurt U.S. industry and “undermined the confidence” of customers and suppliers.
“Slow deliberative” licensing process at State Dept. is “appropriate for military technology” but “wholly inadequate for commercial world,” Dalbello said. Transferring licensing authority would “simplify and clarify” export process and “encourage the growth and competitiveness” of industry, he said. Healthy satellite industry is essential if U.S. wants to maintain “robust and flexible defense industrial base,” Dalbello said. He called return of licensing oversight to Commerce Dept. “single most important step” Administration could take to encourage and strengthen U.S. satellite market. He said satellite industry employment had dropped, along with market share, and some manufacturers were considering leaving industry because of customer consolidation and dwindling profit margins.
PanAmSat is “very supportive” of White House meeting to determine fate of satellite licensing process, Vp-Regulatory Affairs Kalpak Gude told us: “It’s good for everyone that they are taking another look at the rules. This issue has been caught in limbo.” Gude said getting Administration to review rules “can only help in speeding up the legislative process.”
Congressional action would be needed if White House decided to return licensing authority to Commerce Dept. White House also reportedly is talking with Republican leaders on new version of Export Administration Act (EAA) that could be used to transfer satellite licensing authority back to Commerce. White House is said to oppose House version of EAA, which was passed in Aug. 2001 by House International Relations Committee. That bill included provision that would transfer satellite jurisdiction back to Commerce. House Armed Services bill approved measure March 6, with major revisions, including removal of satellite provision. Overall, bill would strengthen export controls on dual-use goods. White House reportedly wants softer version of bill that Senate passed last Sept. That bill makes no mention of satellite exports.