Originally from Dispute Resolution Journal

Satellite industry arbitration involving non-U.S. parties presents unique challenges. Because the transfer or disclosure of satellite technology to foreign persons is strictly controlled by the International Traffic in Arms Regulations (ITAR), special arrangements must be made with the Departments of State and Defense before an arbitration involving satellite technology may proceed. This article discusses the regulatory scheme and how these arbitrations can be successfully managed.

Arbitrations involving high-technology products and services can be challenging for even the most experienced arbitrators and seasoned counsel. Such cases often present difficult disputes over complex technical issues and large dollar amounts. The participation of non-U.S. parties introduces added complexity, particularly where the disclosure of sensitive technical information to foreign persons is controlled by statute or administrative regulations.

The satellite industry is one U.S. sector in which the transfer of technical data to foreign recipients is highly regulated. Satellites, launch vehicles and associated equipment have been designated as “defense articles” and thus appear on the U.S. Munitions List. As such, the exportation by U.S. spacecraft manufacturers of U.S. commercial satellites to operators around the world and the disclosure to non-U.S. persons of certain technical data concerning them are strictly controlled under the Department of State’s International Traffic in Arms Regulations (ITAR).