Securing the Information and Communications Technology and Services Supply Chain: Unmanned Aircraft Systems

DEPARTMENT OF COMMERCE <SUBAGY>Bureau of Industry and Security</SUBAGY> <CFR>15 CFR Part 791</CFR> <DEPDOC>[Docket No. 241213-0327]</DEPDOC> <RIN>RIN 0694-AJ72</RIN> <SUBJECT>Securing the Information and Communications Technology and Services Supply Chain: Unmanned Aircraft Systems</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Bureau of Industry and Security, U.S. Department of Commerce. <HD SOURCE="HED">ACTION:</HD> Advance notice of proposed rulemaking. <SUM> <HD SOURCE="HED">SUMMARY:</HD> In this advance notice of proposed rulemaking (ANPRM), the Department of Commerce's Bureau of Industry and Security (BIS) seeks public comment on issues related to transactions involving information and communications technology and services (ICTS) that are designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of foreign adversaries, pursuant to Executive Order (E.O.) 13873, “Securing the Information and Communications Technology and Services Supply Chain,” and that are integral to unmanned aircraft systems (UAS). This ANPRM will assist BIS in determining the technologies and market participants that may be appropriate for regulation in order to address undue or unacceptable risks to U.S. national security, including U.S. ICTS supply chains and critical infrastructure, or/and to the security and safety of U.S. persons. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Comments must be received on or before March 4, 2025. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> All comments must be submitted by one of the following methods: • <E T="03">The Federal eRulemaking Portal: https://www.regulations.gov</E> at docket number BIS-2024-0058. • <E T="03">Email directly to: UnmannedAircraftSystems@bis.doc.gov.</E> Include “RIN 0694-AJ72” in the subject line. • <E T="03">Instructions:</E> Comments sent by any other method, to any other address or individual, or received after the end of the comment period, may not be considered. For those seeking to submit business confidential information (BCI), please clearly mark such submissions as BCI and submit by email, as instructed above. Each BCI submission must also contain a summary of the BCI, clearly marked as public, in sufficient detail to permit a reasonable understanding of the substance of the information for public consumption. Such summary information will be posted on <E T="03">regulations.gov.</E> Comments that contain profanity, vulgarity, threats, or other inappropriate language or content will not be considered. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Marc Coldiron, U.S. Department of Commerce, telephone: 202-482-3678. <E T="03">For media inquiries:</E> Katherine Schneider, Office of Congressional and Public Affairs, Bureau of Industry and Security, U.S. Department of Commerce: <E T="03">OCPA@bis.doc.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> In E.O. 13873, “Securing the Information and Communications Technology and Services Supply Chain,” (84 FR 22689 (May 17, 2019)) the President delegated to the Secretary of Commerce (Secretary) the authority granted under the International Emergency Economic Powers Act (IEEPA) (50 U.S.C. 1701, <E T="03">et seq.</E> ), to the extent necessary, “to deal with any unusual and extraordinary” foreign threat to the national security, foreign policy, or economy of the United States in connection with the national emergency declared by the President with respect to such threat (50 U.S.C. 1701(a)). In E.O. 13873, the President declared a national emergency with respect to the “unusual and extraordinary” foreign threat posed to the ICTS supply chain and has, in accordance with the National Emergencies Act (NEA), extended the declaration of this national emergency each year since E.O. 13873's publication (see 85 FR 29321 (May 14, 2020); 86 FR 26339 (May 13, 2021); 87 FR 29645 (May 13, 2022); 88 FR 30635 (May 11, 2023); and 89 FR 40353 (May 9, 2024)). Specifically, the President identified the “unrestricted acquisition or use in the United States of [ICTS] designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of foreign adversaries” as “an unusual and extraordinary” threat to the national security, foreign policy, and economy of the United States that “exists both in the case of individual acquisitions or uses of such technology or services, and when acquisitions or uses of such technologies are considered as a class” (E.O. 13873; see also 50 U.S.C. 1701(a)-(b)). Once the President declares a national emergency, IEEPA empowers the President to, among other acts, investigate, regulate, prevent, or prohibit any “acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States” (50 U.S.C. 1702(a)(1)(B)). To address identified risks to U.S. national security from ICTS transactions, the President in E.O. 13873 imposed a prohibition on transactions determined by the Secretary, in consultation with relevant agency heads, to involve foreign adversary ICTS and to pose certain risks to U.S. national security, including U.S. ICTS supply chains and critical infrastructure, and to the security and safety of U.S. persons. Specifically, to fall within the scope of the prohibition, the Secretary must determine that the ICTS transaction: (1) involves ICTS designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary, defined in E.O. 13873 section 3(b) as “any foreign government or foreign non-government person engaged in a long-term pattern or serious instances of conduct significantly adverse to the national security of the United States or security and safety of United States persons”; and (2): A. “poses an undue risk of sabotage to or subversion of the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of information and communications technology or services in the United States;” B. “poses an undue risk of catastrophic effects on the security or resiliency of United States critical infrastructure or the digital economy of the United States;” or C. “otherwise poses an unacceptable risk to the national security of the United States or the security and safety of United States persons” (E.O. 13873 1(a)). These factors are collectively referred to as “undue or unacceptable risks.” Further, E.O. 13873 grants the Secretary the authority to design or negotiate mitigation measures that would allow an otherwise prohibited transaction to proceed (E.O. 13873 1(b)). The President also delegated to the Secretary the ability to promulgate regulations that, among other things, establish when transactions involving particular technologies may be categorically prohibited (E.O. 13873 2(a)-(b); see also 3 U.S.C. 301-302). Specifically, the Secretary may issue rules establishing criteria, consistent with section 1 of E.O. 13873, by which particular technologies or market participants may be categorically included in or categorically excluded from prohibitions established pursuant to E.O. 13873 (see E.O. 13873 2(b)). Any regulated transactions under E.O. 13873 must have a sufficient nexus to a foreign adversary, which, according to E.O. 13873's implementing regulations at 15 CFR 791.4, currently includes, China, People's Republic of (China), including the Hong Kong Special Administrative Region; Republic of Cuba (Cuba); Islamic Republic of Iran (Iran); Democratic People's Republic of Korea (North Korea); Russian Federation (Russia); and Venezuelan politician Nicolás Maduro (Maduro Regime). <HD SOURCE="HD1">II. Introduction</HD> Pursuant to the authority delegated to the Secretary under E.O. 13873, BIS is considering proposing a rule to address the undue or unacceptable risks posed by certain transactions involving ICTS integral to unmanned aircraft system (UAS) when the ICTS are designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of foreign adversaries (foreign adversary ICTS). BIS is also considering whether there are mitigation measures that, if adopted, would allow UAS market participants to engage in transactions that would otherwise pose undue or unacceptable risks. The purpose of this ANPRM is to gather information to support BIS's potential development of a rule regarding foreign adversary ICTS integral to UAS. For the purposes of this rulemaking, unless terms are otherwise defined herein, this ANPRM will apply the definitions listed in 15 CFR 791.2. <HD SOURCE="HD1">III. Request for Comments</HD> BIS is concerned that the involvement of foreign adversaries, notably China and Russia, in the design, development, manufacture, or supply of ICTS integral to UAS poses undue or unacceptable risk to U.S. national security, including U.S. ICTS supply chains and critical infrastructure, and to the security and safety of U.S. persons. As described in more detail below, these countries can leverage their political and legal frameworks to co-opt private entities for national interests, and those private entities maintain dominant market positions in the global commercial UAS sector. This dominance, particularly by China, provides ample exploitation opportunities. Further, both countries have shown a willingness to compromise U.S. infrastructure and security through cyber espionage. The potential for these countries ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 60k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━