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If U.S. ITAR regulations are causing foreign defense contractors to “Design out U.S. content,” thus, losing potential markets, where should we turn to? I say our own backyard

January 24th, 2013
in Expert Guest Blog Entries, International Trade & Defense, Legal Conferences, Regulatory & Compliance |

Expert Article by Christos Linardakis

With the elections and holidays now behind us, it appears Congress will make another attempt to finish up their changes to the ITAR regulations, but not likely anytime soon. Although tremendous progress has been made in sorting out a “maze” of restrictions and regulations, a lot more work is required. Thus, with both U.S. and foreign defense manufacturers “designing out” U.S. products that are subject to the ITAR, maybe we should be looking closer to home? Maybe the potential to overcome, at least temporarily, some of these strict requirements, is by looking at our own backyard for new opportunities?

I recall a long time ago, when my younger brother said, “there’s more than enough places here in the U.S. to see, why do you keep going overseas?” A quarter century later, that comment still rings true. So, why couldn’t it apply to ITAR-controlled products? The Department of Homeland Security (DHS) is currently using 2 types of UAVs: drones and remotely piloted vehicles (RPVs), both of which are now being utilized for our U.S. – Mexico border patrol. U.S. Customs, U.S. Coast Guard, and other Federal law agencies are seeking to acquire more technology in their battle against cyber-attacks and in homeland security—everything from night-vision to “Unmanned Aerial Systems,” which combine control station, software and data links to support UAVs, all of which are predominately controlled under the ITAR.

With provisions like the “Buy American Act” and other government procurement requirements, U.S. manufacturers have a potentially untapped domestic market, other than the traditional DOD arena. Fears of coordinated attacks on key-critical infrastructures will continue to put pressure on the DHS to step up its role in the “defense” area, all of which will need support by U.S. manufacturers of military products, that we can (and should) tap into.

In the end, all companies will need to adapt to the changing environment surrounding ITAR controlled products. Whether it’s by designing commercial items applicable for defense applications, or looking at new potential markets closer to home, like the DHS, maybe it’s time to rethink our strategies?

And as to my brother’s comment? I’ve taken his advice and started traveling in the U.S.

Tags: ACI Event, Christos Linardakis, ITAR
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