Obama Memo Puts Export Reform on Front Burner

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WASHINGTON — U.S. President Barack Obama has directed his administration to recommend by no later than Jan. 29 steps leading to an overhaul of the U.S. export control regime, according to a presidential directive signed Dec. 21.

The recommendations are to be based on the findings of a sweeping interagency review of U.S. rules that govern exports of unclassified military and dual-use technologies — including commercial communications satellites — announced by the White House Aug. 13.

“The results of this review shall be used to prepare a comprehensive set of recommendations to create a new U.S. export control system,” states the Dec. 21 document, known as Presidential Study Directive 8. “The recommendations shall include statutory and regulatory steps necessary for implementation.”

The review is being conducted by a task force established by National Security Adviser James Jones and National Economic Council Director Lawrence Summers that includes staff members of the National Security Council. The task force’s recommendations are to be delivered to members of the president’s Cabinet, including the secretaries of commerce, defense, energy, homeland security, state and treasury, as well as the U.S. attorney general and director of national intelligence.

In drafting the recommendations, the task force is to consider the findings of “numerous studies” that have examined the existing U.S. export control regime, as well as past and current legislation addressing export control reform. The directive also instructs the task force to draw upon the expertise of U.S. industry and allies, particularly those from countries with regulatory regimes that could serve as a model.

U.S. export control reform is a polarizing topic that pits national security hawks against the American aerospace industry. The U.S. space industry in particular has seen its market share decline since a 1999 crackdown on U.S. commercial communications satellite exports. Congress made all commercial satellites subject to the restrictive International Traffic in Arms Regulations — administered by the U.S. State Department — in the late 1990s following allegations that China was benefiting militarily from launches of U.S.-built spacecraft. Before that legislation was passed as part of the Strom Thurmond National Defense Authorization Act of 1999, the Commerce Department had export licensing authority over all but the most sophisticated commercial communications satellites.

The establishment of the task force Aug. 13 was the first official indication that Obama would advance export control reform. Administration sources said the Dec. 21 directive is intended to expedite the effort.

One administration official said that, generally speaking, a presidential study directive “serves as an interagency forcing function in that it comes with a presidential signature and a due date.”

Matthew Borman, acting assistant secretary of commerce for export administration, said in early December that the White House was looking for comprehensive changes to the current regime, rather than targeted improvements.

“It’s a blank page, if you will,” Borman told reporters following Dec. 9 testimony before the House Foreign Affairs terrorism, nonproliferation and trade subcommittee.

Borman said efforts to reform export controls under the administration of former President George W. Bush had fallen short. He noted that several current Cabinet secretaries are publicly calling for reform, including Defense Secretary Robert Gates, who has visibly pushed the reform agenda since the White House announced the review in August.

William Reinsch, who served as undersecretary of commerce for export administration under former President Bill Clinton, said that while U.S. industry might welcome a complete overhaul of the current regime, starting from a blank page as characterized by Borman will not be easy. “It depends on what they put on the page,” Reinsch, who now heads the National Foreign Trade Council here, said in an interview.

He said the task force likely would provide a range of recommendations to Cabinet secretaries to include everything from minor system tweaks to the creation of a new export control agency.