Deemed Exports and Space Tourists?

November 1, 2007 at 10:59 am | Posted in Space Law | 1 Comment

by P.J. Blount with the blog faculty
The International Traffic in Arms Regulations (ITAR) are a complex set of export controls for defense items. It is necessary for commercial space firms to get export licenses in order to export much of their technology. This is because spacecraft and satellites were added to ITAR in 1999(United States Munitions List (USML) at 22 CFR 121.1 Category XV).

In light of this, it is interesting to note that last Friday, State media in China reported that seven Chinese citizens have applied to become space tourists with Virgin Galactic . Since China was the nation at issue in the Cox Report , which reccomended that satellites and spacecraft be put under State Department control (v. III, pg. 170), this development highlights what might be a form of licensing that could be applied to space tourists.

The Human Spaceflight Participant Requirements issued by the FAA do not call for a Space Flight Participant to have any sort of license. If, however, a space flight participant is a foreign national the space tourism company might need to get an ITAR license to export its technology to that person. This could potentially cause problems for service providers, but it could also give the United States more control over who gets to become a spaceflight participant.

It sounds a bit strange at first, as the space tourist would be present in the United States and would not necessarily recieve anything tangible. However, an export can occur due to two provisions of ITAR. First, “technical data” cannot be exported without a license. “Technical data” is a very broad term:

(a) Technical data means, for purposes of this subchapter:
(1) Information, other than software as defined in Sec.
120.10(a)(4), which is required for the design, development, production,
manufacture, assembly, operation, repair, testing, maintenance or
modification of defense articles. This includes information in the form
of blueprints, drawings, photographs, plans, instructions or
documentation.
(2) Classified information relating to defense articles and defense
services;
(3) Information covered by an invention secrecy order;
(4) Software as defined in Sec. 121.8(f) of this subchapter
directly related to defense articles;
(5) This definition does not include information concerning general
scientific, mathematical or engineering principles commonly taught in
schools, colleges and universities or information in the public domain
as defined in Sec. 120.11. It also does not include basic marketing
information on function or purpose or general system descriptions of
defense articles. (22 CFR 120.10)

Second, ITAR contains a deemed export rule:

(4) Disclosing (including oral or visual disclosure) or transferring
technical data to a foreign person, whether in the United States or
abroad;

Essentially, if a person is a foreign national, then giving that person technical data covered by the USML is an export even if they are in the United States.

Presumably, a space tourist must at some point see the craft and its components (components are also on the USML) during the trip. This could allow an individual to percieve, through a visual inspection, technical data about the craft. If that individual is a foreign national, then a deemed export will have occurred, and a license should have been obtained by the company prior to the export. Another layer is added by the Human Space Flight Requirements. The Requirements do not call for licensing of each individual participant, but they do require informed consent from each individual (14 CFR 460.15). The space flight provider must provide, among other things:

d) An operator must describe the safety record of its vehicle to
each space flight participant. The operator’s safety record must cover
launch and reentry accidents and human space flight incidents that
occurred during and after vehicle verification performed in accordance
with Sec. 460.17, and include–
(1) The number of vehicle flights;
(2) The number of accidents and human space flight incidents as
defined by section 401.5; and
(3) Whether any corrective actions were taken to resolve these
accidents and human space flight incidents.
(e) An operator must inform a space flight participant that he or
she may request additional information regarding any accidents and human
space flight incidents reported.
(f) Before flight, an operator must provide each space flight
participant an opportunity to ask questions orally to acquire a better
understanding of the hazards and risks of the mission, and each space
flight participant must then provide consent in writing to participate
in a launch or reentry.

Coupled with the broad definition of “technical data” used in ITAR it is possible that companies might be required to disclose “technical data” to participants in order to recieve informed consent. Furthermore, the space flight providers are required to train participants in how to respond to emergencies on the spacecraft. This, too, could require the disclosure of “technical data” to the participant.

The application of export controls in this manner could have implications for US space tourism and its access to the world market. If an export license is needed for every international tourist on board the ship, the costs will rise for each ticket. Additionally, due to the increasing processing time at the State Department, individuals might have to have their flight postponed while their license gets processed (see Arms Export Control System in the Post- 9/11 Environment, GAO-05-234).

Virgin Galactic has been able to effectively deal with ITAR issues in the past (see also here and here). However, the Technical Assistance Agreeement (TAA) that was agreed upon covers technology transfers between US and British entities. If a deemed export were to occur through the presence of a tourist on board a space craft, then the export would be deemed to have occured to the State of nationality for that tourist. A Chinese tourist would mean an export to China. Will Whitehorn, has acknowledged that the TAA is between Virgin Galactic and Scaled Composites. He said, “Exporting the technology to a third party country would be another issue…and one that will have to be addressed in the future.”