Photo: Tech. Sgt. Joseph Pagan
On January 7, 2025, the outgoing administration announced new U.S. policy guidance for implementing the Missile Technology Control Regime (MTCR), which is a voluntary multilateral arrangement established in 1987 with the purpose of limiting “the risks of proliferation of weapons of mass destruction (i.e. nuclear, chemical and biological weapons), by controlling transfers that could make a contribution to delivery systems (other than manned aircraft) for such weapons.” The new guidance “directs the interagency to provide increased flexibility for case-by-case review and facilitate support for certain MTCR Category I military missiles, Unmanned Aerial Systems (UAS), and Space Launch Vehicle (SLV) systems to certain partners with strong export control systems.” It also establishes that “transfers of MTCR Category I SLV related commodities, software, and technology will be considered on a case-by-case basis for select and vetted partner space programs and participation in international space programs, whether such programs are governmental or commercial in nature.”
This is an important, and long-overdue, paradigm shift in how the United States interprets its commitments under the MTCR. The policy shift will bolster the U.S. ability to deter our adversaries, strengthen the U.S. defense industrial base (and associated jobs) in crucial high-tech sectors, streamline defense trade, and broaden the scope of future space partnerships with U.S. allies and partners.
Here’s why it matters: The U.S. shift jettisons a policy approach that for years had enforced an even higher bar than the MTCR Guidelines’ strong presumption of denial for transfers of Category I systems (Note: This includes, among other things, “Complete rocket systems (including ballistic missiles, space launch vehicles, and sounding rockets) capable of delivering at least a 500 kg “payload” to a “range” of at least 300 km” and “Complete unmanned aerial vehicle systems (including cruise missiles, target drones and reconnaissance drones) capable of delivering at least a 500 kg “payload” to a “range” of at least 300 km”). Essentially, the United States had turned the MTCR’s presumption of denial (a presumption which can and should be overcome when in the U.S. interest), into a policy of denial, going far beyond what was intended in the drastically different security environment of 1987. This led to the denying of U.S. transfers of MTCR-adjacent technology even to close allies and partners without weapons of mass destruction (WMD) programs.
U.S. policy also further exceeded its MTCR commitments to adopt a position that the United States would also not encourage “new” (i.e., post-1987) space transportation programs, even in other MTCR countries. The exemption built into the MTCR that “[t]he Guidelines are not designed to impede national space programs or international cooperation in such programs as long as such programs could not contribute to delivery systems for weapons of mass destruction” was generally not exercised in practice by the United States. Instead, the United States chose to treat these post-1987 space launch efforts as erstwhile WMD delivery system programs, even where programs originated in countries in good standing with arms control and nonproliferation arrangements and were declared nonnuclear weapons states.
To make matters even worse, such a strict U.S. interpretation of its MTCR commitments was never adopted by either our friends or our foes, essentially locking in a strategic disadvantage for the United States without meaningfully advancing U.S. nonproliferation objectives. Among the many negative follow-on consequences over the years for such an approach was encouraging reliance by allied nations (including the Republic of Korea (ROK)) on Russian suppliers for space technologies.
January’s policy shift, therefore, should be viewed not as watering down the MTCR, but rather as expanding the ability of the United States to benefit from technology transfer to—and among—its close allies and partners amidst the increase of defense technology and capability trade among adversarial nations.
As noted above, among the beneficiaries of January’s policy shift will be the beleaguered U.S. defense industrial base. Following Russia’s renewed invasion of Ukraine in 2022, the intervening years have revealed clear shortfalls in the U.S. defense industrial base, ranging from inadequate production capacity (e.g., with regards to solid rocket motors and artillery shells), the lack of a secure supply chain for the critical minerals and other inputs needed to fuel such production, and inadequate magazine depth for a wide range of systems, both domestically and among our allies.
Among the various methods being pursued for addressing such issues has been a shift towards a deeper integration with the allied defense base, which has been the subject of a range of initiatives including the U.S.-Japan Defense Industrial Cooperation, Acquisition, and Sustainment forum. January’s MTCR reform should greatly empower such efforts moving forward by enabling greater burden sharing by allies in areas such as expanded licensed production of U.S. systems, codevelopment, and coproduction, as well as supporting allies’ efforts to develop their own capabilities via greater purchases of U.S. defense exports.
While this policy reform enables the most ambitious overhaul of U.S. export controls for missile, space, and UAS technology in decades, a policy is only as good as its implementation, a task that will now fall to the new administration.
Taking up this issue would provide the new administration with a near-term opportunity to advance its own priorities, including reviving the industrial base, cutting excessive regulations, and increasing allied defense investment, and it would also be a continuation of a theme of the first Trump administration, which oversaw a major reform of the policy for the transfer of U.S.-origin UAS in 2020 by deciding to treat a subset of MTCR Category I UAS with maximum airspeed of less than 800 kilometers per hour as Category II.
I would offer three areas of implementation for consideration by the new administration on this topic:
Aligning key regulations with the new MTCR policy can be achieved relatively rapidly, as the vehicles for doing so are already in hand: the emerging AUKUS regulatory framework and the space export control reform regulations that were released for public comment by the Department of State and the Department of Commerce in late 2024 at the direction of the National Space Council.
In the case of AUKUS, the main update needed will be to remove various technologies from the Excluded Technology List to bring it into alignment with the new U.S. MTCR policy, and for the partners to establish a clear path ahead for enabling greater industry-to-industry cooperation with minimal regulatory overhead.
In the case of the space regulations, the feedback received from U.S. industry during that 2024 comment period must also be incorporated along with the new MTCR policy. This will be especially crucial for the draft Department of State rule, which demonstrated deficiencies in its understanding of the contemporary global commercial space market, especially regarding foreign commercial availability.
Left unfixed, such basic misconceptions would have real-world negative effects on the U.S. commercial space sector and associated jobs, including but not limited to: locking U.S. providers of synthetic aperture radar data into a position of inferiority by only being able to export spacecraft two generations behind what is already available in the global market, continuing to place U.S. providers of radiofrequency data at a competitive disadvantage to foreign competitors through strictly controlling export as a “defense service,” and continuing to cede almost all of the infrared market to foreign competitors.
Once these revisions are completed, including any necessary public comment period(s), then the AUKUS and space export control reform rules should be finalized and published as soon as possible (ideally within the first 100 days of the administration). Moving forward, other regulations will also likely need to be eased to align export controls with U.S. national objectives, including trusted technology partnerships such as the U.S.-India Initiative on Critical and Emerging Technology and any successor initiative(s). State should ensure that export regulations pertinent to fast-moving technology areas are reviewed regularly, and that evaluation of foreign commercial availability of such capabilities is an explicit part of the evaluation process on the front end, not something that must be fixed on the back end through industry comments.
Currently, which nations are eligible for favorable treatment under the new MTCR policy remains unclear publicly. The White House Fact Sheet notes that “these policy changes will help the United States advance shared defense objectives with close allies, including the implementation of AUKUS,” which would imply that Australia and the United Kingdom are now eligible for favorable treatment. The previous National Security Advisor also announced the signing of this new policy during a visit to India, which would seem to indicate an intention for India’s inclusion, but this is not confirmed at present.
Beyond such vague indications, there remains broad public uncertainty about which other partners are included on the list. The new administration will have to establish its own position on this matter, not only concerning the inclusion of Australia, India, and the United Kingdom, but also which additional nations would be eligible for favorable treatment, and why.
Given the strategic disadvantage that the United States has created for itself and its partners across decades as outlined above, I would argue for a broader list of nations, so as to begin repairing the damage as rapidly as possible. I would offer the following as a starting point for nations to be considered for favorable export treatment under this reform:
Membership in the four core multilateral nonproliferation regimes (i.e., the MTCR, the Nuclear Suppliers Group (NSG), the Australia Group, and the Wassenaar Arrangement) should be weighed as part of such considerations, but I would caution against making formal membership in any or all of the four regimes a litmus test. For example, requiring MTCR membership would exclude Israel and Taiwan, while requiring NSG membership would exclude India; in some cases, various countries who are otherwise strong nonproliferation advocates are blocked from membership in these regimes by other nations, and it is silly to penalize good actors due the machinations of bad ones.
However, nations that currently have an adversarial posture towards the United States, are under the sway of U.S. adversaries, or whose export control systems pose an unacceptable risk of diversion, should be excluded from consideration for favorable treatment, even if they are part of the group(s) outlined above.
While January’s MTCR policy reform is a significant step, further work will be needed in the years ahead regarding the U.S. approach to the MTCR.
First, as noted above, the MTCR itself, and especially the previous U.S. interpretation of its commitments under the MTCR, have often treated a range of technologies as being equally dangerous and, therefore justifying the same severe level of control. This includes treating SLVs and sounding rockets as virtually identical to—and incapable of being differentiated from—ballistic missiles and lumping in a range of drones with cruise missiles.
Nearly four decades on from the establishment of the MTCR, this approach is now in desperate need of an overhaul in a world of great power competition; widespread foreign availability of missile, space, and UAS technologies (including from adversaries); and a thriving commercial space economy. Therefore, the United States should lead an urgent review of the MTCR Guidelines and Annex, with the goal of making the organization fit for purpose in the twenty-first century.
This review should seek to establish methods for differentiating ballistic missiles from commercial SLVs intended for transfer to allies who lack WMD programs, as well as to differentiate between liquid-fueled and solid-fueled SLVs. Drones should be separated from cruise missiles and perhaps excluded from the scope of the MTCR entirely (as is the case with manned aircraft). Should it prove impossible to achieve consensus among MTCR partners (minus Russia, who remains an MTCR member, albeit a very notional one) on such changes, then the United States would reserve the right to issue a unilateral policy announcement to implement changes in this area.
Speaking of Russia, it is hard to envision the long-term ability of the MTCR to operate effectively when it includes such a state, about which the previous Secretary of State announced: “we have reason to believe that Moscow intends to share advanced space and satellite technology with Pyongyang, and that Putin may be close to reversing a decades-long policy by Russia and accepting DPRK’s nuclear weapons program.” This echoes previous comments from the chief of the U.S. Indo-Pacific Command that Russia would likely provide North Korea with missile technology. In the years to come, there will either need to be a mechanism for MTCR partners to operate without Russia (i.e., a “Consensus Minus One” approach similar to what has been emerging in the Wassenaar Arrangement), or to form a separate group that excludes Russia. Such a mechanism should also address the aspirations of friendly countries to create spaceports while accounting for the reality of spaceport partnerships offered by competitors. The scope of U.S. Technology Safeguards Agreements (TSAs) with various nations should also be adjusted to account for the new MTCR policy, and in the case of particularly close allies perhaps standalone TSAs can be dispensed with and transfers can instead be handled through normal licensing and technology protection procedures.
While MTCR policy reform is not a silver bullet for everything that ails the U.S. export control system (which goes beyond the scope of this article but would include retooling the Foreign Military Sales process and addressing issues connected with technology release), the jettisoning of such a disadvantageous MTCR policy approach this January is welcome, necessary, and long overdue.
However, a policy is only as good as its implementation. The new administration has been presented with an opportunity to build upon this policy shift to realize the most ambitious reform of U.S. export controls on missile, space, and UAS technology in decades.
Sean Wilson is a senior associate (non-resident) with the Aerospace Security Project at the Center for Strategic and International Studies in Washington, D.C. He is also the founder and CEO of the Mirai Group and the former director of international space policy at the White House.
The opinions and characterizations in this piece are those of the author and do not necessarily represent those of the U.S. government.
