[Federal Register Volume 65, Number 147 (Monday, July 31, 2000)]
[Rules and Regulations]
[Pages 46822-46837]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-18725]



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Part IV





Department of Commerce





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National Oceanic and Atmospheric Administration



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15 CFR Part 960



Licensing of Private Land Remote-Sensing Space Systems; Interim Final 
Rule

  Federal Register / Vol. 65, No. 147 / Monday, July 31, 2000 / Rules 
and Regulations  

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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

15 CFR Part 960

[Docket No.: 951031259-9279-03]
RIN 0648-AC64


Licensing of Private Land Remote-Sensing Space Systems

AGENCY: National Oceanic and Atmospheric Administration, Commerce.

ACTION: Interim final rule with request for comments.

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SUMMARY: The National Oceanic and Atmospheric Administration (NOAA) 
issues regulations revising the agency's minimum requirements for the 
licensing, monitoring and compliance of operators of private Earth 
remote sensing space systems under Title II of the Land Remote Sensing 
Policy Act of 1992 (the Act). These regulations implement the 
provisions of the 1992 Act, as amended by the 1998 Commercial Space 
Act, and the Presidential Policy announced March 10, 1994 (hereinafter 
PDD 23). They are intended to facilitate the development of the U.S. 
commercial remote sensing industry and promote the collection and 
widespread availability of Earth remote sensing data, while preserving 
essential U.S. national security interests, foreign policy and 
international obligations.

DATES: This rule is effective August 30, 2000. Comments must be 
received by September 29, 2000.

ADDRESSES: Comments should be sent to, Charles Wooldridge, NOAA, 
National Environmental Satellite, Data, and Information Service, 1335 
East-West Highway, Room 7311, Silver Spring, MD 20910.

FOR FURTHER INFORMATION CONTACT: Charles Wooldridge at (301) 713-2024, 
ext. 207 or Karen D. Dacres, NOAA, Office of the General Counsel, 
Office of the Senior Counselor for Atmospheric and Space Services and 
Research, at (301)713-1329, ext. 200.

SUPPLEMENTARY INFORMATION: Title II of the Act, 15 U.S.C. 5601 et seq., 
as amended by Public Law 105-303, authorizes the Secretary of Commerce 
(the Secretary) to issue licenses for operation of private remote 
sensing space systems. The authority to issue licenses has been 
delegated from the Secretary to the Administrator of NOAA (the 
Administrator) and redelegated to the Assistant Administrator for 
Satellite and Information Services (the Assistant Administrator).
    On November 3, 1997, NOAA issued a Notice of Proposed
    Rulemaking (NPRM) (See 62 FR 59317). The regulations published 
herein update the 1987 Regulations and address the public comments 
received in response to the prior NPRM. These regulations apply to all 
existing licenses, as well as to all pending and future applications to 
operate a private remote sensing space system. They are intended to 
promote the development of the U.S. commercial remote sensing industry 
and promote the collection and widespread availability of earth remote 
sensing data while protecting U.S. national security concerns, foreign 
policy and international obligations.
    NOAA encourages and promotes the development of advanced 
technologies in the remote sensing industry, but recognizes that 
national security concerns, foreign policy and international 
obligations of the United States may mandate that limitations be 
imposed on a system's operation.

1. Major Substantive Issues Raised by Public Comment

    NOAA received 24 sets of public comments regarding the November 3, 
1997, Notice of Proposed Rulemaking from a wide range of interests in 
industry, academia, government, and the foreign policy community. 
Despite the volume of comments, most issues raised can be summarized 
under the following categories:
    (1) control, ownership, and investment;
    (2) national security interests, foreign policy and international 
obligations;
    (3) review of foreign agreements;
    (4) confidentiality of information; and
    (5) the interagency memorandum of understanding.

Control, Ownership, and Investment

    Numerous public comments were related to NOAA's proposed approach 
to address the U.S. Government's requirement to regulate and monitor 
the control of licensees and the operation of their systems. Most 
commenters thought that the proposed regulations failed to adequately 
distinguish between control and ownership; that NOAA has no statutory 
authority to prohibit foreign investment per se; and that NOAA should 
harmonize its regulations with existing Treasury and Securities and 
Exchange Commission regulations to monitor change of control.
    In developing these final regulations, NOAA accepted many of the 
suggestions by the commenters. This final rule focuses on control over 
the ``operation'' of the remote sensing system, consistent with NOAA's 
statutory authority to license ``operations'' in a manner that protects 
the national security, foreign policy and international obligations of 
the United States. In furtherance of these mandates, a fundamental 
obligation is incorporated into these regulations requiring the 
licensee to maintain operational control at all times and provide other 
safeguards to ensure the integrity of system operations. NOAA has added 
definitions for ``operations'' and ``operational control''. The 
definition of ``operations'' serves to effectively determine the scope 
of activities covered by the NOAA license. Foreign entities may be 
involved in the operations of the system with approval based on a 
review conducted by NOAA in consultation with other U.S. Government 
(USG) agencies. Operational control is defined to include the 
requirement that if entities, domestic or foreign, other than the 
licensee are involved in the operations of the system, the licensee 
must ultimately be able to override from U.S. territory all commands 
issued by any operations centers and stations.
    A definition of administrative control has been included and is 
adapted from the definition of control contained in the Department of 
Treasury Regulations Pertaining to Mergers, Acquisitions, and Takeovers 
by Foreign Persons (31 CFR Part 200). Transfer of administrative 
control is permissible on a case by case basis unless the USG believes 
that the foreign entity exercising control might take action that 
threatens to impair U.S. national security, foreign policy and 
international obligations. Licensees are required to obtain an 
amendment for any transaction that would constitute a transfer of 
administrative control. Consequently, NOAA has dropped the strict 
presumption of transfer of control based solely on level of foreign 
investment and has also deleted bright line tests linked to specific 
investment levels or thresholds. However, the level of investment will 
be one of several factors to be considered in our analysis.
    In an effort to eliminate excessive and redundant regulatory 
burdens on industry, NOAA has eliminated certain portions of the 
lengthy and rigid notification, amendment, technology transfer, and 
export control requirements found in the section on investments 
(960.14) from the previous NPRM. Some of these requirements are now 
more appropriately addressed in the sections on amendments and foreign 
agreements. Others have been eliminated due to overlap with similar 
requirements imposed by other agencies' authorities relating to mergers 
and acquisitions, securities reporting,

[[Page 46823]]

and export control. For instance, for monitoring purposes NOAA will use 
quarterly reports filed by publicly-traded licensees as required by the 
SEC. In the event that the licensee is not a publicly-traded company, 
the licensee must provide the information required by the SEC in the 
10K and 10Q forms.

National Security, Foreign Policy and International Obligations

    Many commenters contended that the NPRM was too vague and lacked 
needed transparency with regard to limitations on data collection and/
or dissemination (shutter control) during periods when national 
security, foreign policy or international obligations may be 
compromised. Further, some insisted that shutter control is fraught 
with constitutional issues relating to prior restraint of speech and 
therefore shutter control required tighter standards than those 
articulated in the NPRM. Finally, some commenters contended that 
shutter control could only be imposed by the Executive Branch after 
judicial review.
    A fundamental precept of the 1992 Land Remote Sensing Policy Act 
and PDD 23 is that licensing of private remote sensing space systems 
must protect the national security, foreign policy and international 
obligations of the United States. The USG has reviewed these 
regulations in light of the expressed concerns and finds that the 
regulations strike an appropriate balance between promoting the U.S. 
commercial remote sensing industry and protecting U.S. national 
security, foreign policies and international obligations.
    In an effort to provide more clarity, the Departments of State, 
Defense, Interior, Commerce, and the Intelligence Community, with the 
participation of the Office of Science and Technology Policy (OSTP) and 
the National Security Council (NSC), concluded an interagency 
Memorandum of Understanding (Interagency MOU) concerning the Licensing 
of Private Remote Sensing Space Systems. On February 2, 2000, a Fact 
Sheet on the Interagency MOU was released. This Fact Sheet is included 
as Appendix 2.
    The MOU provides among other things that determinations involving 
impositions of limitations during commercial operations will be made at 
the highest level. The industry and its customers should be reassured 
by the MOU's terms which provide that any such limitation should be 
imposed for the smallest area and for the shortest period necessary to 
protect the national security, international obligation, or foreign 
policy concerns at issue. Alternatives to prohibitions on collection 
and/or distribution will be considered such as delaying the 
transmission or distribution of data, restricting the field of view of 
the system, encryption of the data if available, or other means to 
control the use of the data.

Review of Foreign Agreements

    The definition of significant and substantial foreign agreement was 
too broad according to many comments. Several commenters stated that 
the NPRM lacked necessary timelines and criteria for the review of 
foreign agreements.
    These regulations contain a revised definition of significant and 
substantial foreign agreement to reflect the tighter focus on issues of 
control. This definition has been harmonized with the definitions of 
administrative control, operations, and operational control. NOAA has 
also added timelines and criteria to indicate the scope of the review.

Confidentiality of Information

    Several commenters argued that the NPRM levied burdensome and 
intrusive requirements on applicants/licensees to protect their 
proprietary information. Recommendations were made that NOAA treat 
anything marked proprietary by an applicant/licensee as such without 
further justification. Others felt that it is in the public interest 
for NOAA to make its licensing regime more transparent, specifically 
that the public should have access to summaries of license actions 
under review by the agency.
    NOAA has removed the requirements of the previous NPRM to provide 
justification for all information submitted by an applicant/licensee in 
order for the USG to treat it as proprietary information. In accordance 
with Section 960.5 and the Federal Trade Secrets Act (18 U.S.C. 1905), 
NOAA will treat all information marked by the licensee as proprietary 
and no further action on the part of the licensee will be required. Any 
requests for information will be treated in accordance with the Freedom 
of Information Act in order to protect proprietary information. In the 
compelling public interest to have basic information concerning the 
regulatory activities of NOAA made more broadly available, these 
regulations retain the requirement that licensees provide an executive 
summary of their application that can be made available to the public.

Interagency Memorandum of Understanding

    Several commenters stated that the Interagency MOU referenced in 
the preamble should be part of the public rulemaking process and 
submitted for public review and comment.
    The Interagency MOU is to establish under the 1992 Act and the 
President's policy on remote sensing, interagency procedures concerning 
certain aspects of licensing of private remote sensing space systems. 
The Interagency MOU Fact Sheet released on February 2, 2000, is 
included as Appendix 2 and is not intended to solicit public comments.

2. Organization

    Part 960 is organized into four (4) Subparts, discussed in greater 
detail below:
    (a) Subpart A consists of general information about the regulations 
such as the purpose, scope and definitions;
    (b) Subpart B addresses licensing procedures and conditions;
    (c) Subpart C describes the prohibitions on operating a remote 
sensing space system under these regulations; and
    (d) Subpart D sets forth the civil penalties available to the 
agency for noncompliance with these regulations and/or the terms of any 
license issued pursuant to these regulations.

3. Subpart A--General

    Section 960.1. Purpose. This section sets forth the purpose of the 
regulations regarding licensing and regulating the operation of private 
remote sensing space systems under Title II of the Act and reflects the 
President's Policy announced on March 10, 1994, entitled, ``U.S. Policy 
on Foreign Access to Remote Sensing Space Capabilities'' (PDD 23).
    Section 960.2. Scope. This section sets forth the legal parameters 
for application of the Act and these regulations. In addition, this 
Section makes the regulations applicable with respect to all existing 
and new licenses. Potential licensees may address questions regarding 
the applicability of the Act and these regulations to the Assistant 
Administrator.
    Of particular interest is the fact that the Act and these 
regulations apply to any person subject to the jurisdiction or control 
of the United States who operates or proposes to operate a private 
remote sensing space system, either directly or through an affiliate or 
subsidiary. For the purposes of these regulations, a person is:
    (1) An individual who is a United States citizen, or a foreign 
person

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subject to the jurisdiction and control of the United States;
    (2) A corporation, partnership, association, or other entity 
organized or existing under the laws of any state, territory, or 
possession of the United States;
    (3) A subsidiary (foreign or domestic) of a U.S. parent company;
    (4) An affiliate (foreign or domestic) of a U.S. company; or
    (5) Any other private remote sensing space system operator having 
substantial connections with the United States or deriving substantial 
benefits from the United States that support its international remote 
sensing operations sufficient to assert U.S. jurisdiction as a matter 
of common law.
    Relevant connections may include: using a U.S. launch vehicle and/
or platform; operating a spacecraft command and/or data acquisition or 
ground remote station in the United States; and processing the data at 
and/or marketing it from facilities within the United States. Please 
note that these examples are merely illustrative of the factors that 
may be examined in making a jurisdictional determination and are not 
intended to be all-encompassing.
    Section 960.3. Definitions. This section defines terms used 
throughout these regulations, including the following terms:
    (1) Administrative control; (2) significant and substantial foreign 
agreement; (3) remote sensing space system and (4) operational control.

4. Subpart B--Licenses

    License applicants are encouraged to contact the Assistant 
Administrator or his or her designee at the earliest possible planning 
stages. Such consultation may reveal design or data collection 
requirements that may be accommodated early, thereby avoiding changes 
to system design or data collection characteristics.
    Section 960.4. Application. This section sets forth license 
application instructions. Further information regarding the content of 
the license application has been included in Appendix 1. The agency 
record will be opened upon the filing of the license application.
    In general, a license application should contain a complete 
description of the design of the sensor package. The level of detail 
should approximate that necessary for a contractor Preliminary Design 
Review. The potential licensee should note that subsequent changes to 
the design affecting those operational capabilities after a license is 
awarded may require a license amendment.
    Section 960.5. Confidentiality of information. This section sets 
forth NOAA's obligation to keep confidential proprietary information 
submitted by licensees or potential licensees and imposes a requirement 
to provide a summary of such information that can be made public.
    Section 960.6. Review Procedures for license applications. This 
section describes the application review process.
    Section 960.7. Amendments to licenses. This section enumerates some 
of the events or conditions which may trigger the requirement for a 
license amendment. An application for a license amendment must contain 
all relevant new information and must be filed with the Assistant 
Administrator. Amendment applications must be filed in accordance with 
the procedures specified in Section 960.4 and Appendix 1 for original 
license applications.
    Please note that for purposes of Section 960.7, the following 
transactions do not require an amendment to a license. However, they do 
require agency notification under its monitoring and compliance 
requirements in the Annual Compliance Audit:
    (1) An acquisition of voting securities pursuant to a stock split 
or pro rata stock dividend which does not involve a change in 
administrative control;
    (2) An acquisition of convertible voting securities that does not 
involve acquisition of administrative control;
    (3) A purchase of voting securities or comparable interests in a 
licensee solely for the purpose of investment if, as a result of the 
acquisition:
    (A) When the acquisition is by a foreign person, the foreign person 
would hold ten percent or less of the outstanding voting securities of 
the licensee, regardless of the dollar value of the voting securities 
so acquired and held; or
    (B) The purchase is made directly by a bank, trust company, 
insurance company, pension fund, employee benefit plan, mutual fund, 
finance company or brokerage company in the ordinary course of business 
for its own account, provided that a significant portion of that 
business does not involve the acquisition of entities.
    (4) An acquisition of securities by a person acting as a securities 
underwriter, in the ordinary course of business, and in the process of 
underwriting;
    (5) An acquisition pursuant to a condition in a contract of 
insurance relating to fidelity, surety, or casualty obligations if the 
contract was made by an insurer in the ordinary course of business;
    (6) An acquisition of a security interest, but not control, in the 
voting securities or assets of a licensee at the time a loan or other 
financing is extended; or
    (7) An acquisition of voting securities or assets of a U.S. person 
by a foreign person upon default or other condition, involving a loan 
or other financing, provided that the loan was made by a syndicate of 
banks in a loan participation where the foreign lender(s) is/are in the 
syndicate:
    (A) Need(s) the majority consent of the U.S. participants in the 
syndicate to take action, and cannot on its own initiate any action 
vis-a-vis the debtor; or
    (B) Do/does not have the lead role in the syndicate, and are/is 
subject to a provision in the loan or financing documents limiting its 
influence, ownership or administrative control of the debtor.
    Section 960.8. Notification of Foreign Agreements. This section 
reflects the balance between promoting the commercial U.S. remote 
sensing industry and those requirements imposed by national security 
concerns, foreign policy and international obligations of the U.S. 
Government. Specifically, this section establishes the procedures, 
timelines and criteria for review and approval of a licensee's 
significant and substantial foreign agreements.
    Section 960.9. License Term. This section provides that the term of 
a license for operation of a remote sensing space system is the 
operational lifetime of the system as long as the system is operated in 
compliance with the terms and conditions of the license and in 
accordance with the Act and this Part. In particular, Section 201(b) of 
the Act authorizes the Secretary to grant licenses to operate a system, 
only upon a determination that the granting of such license and the 
operation of the system by the licensee would be consistent with the 
national security concerns, foreign policy and international 
obligations of the United States. The requirement set forth in Section 
201(b) is an ongoing obligation of the Secretary, and as such, the 
Secretary must regularly monitor the operation of the system and the 
activities of the licensee to assure that the national security 
concerns, foreign policy and international obligations of the U.S. are 
being protected and that the licensee is in compliance with the 
requirements of this Act, any regulations issued pursuant to the Act,

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and the terms and conditions of its license.
    Section 960.10. Hearings and Appeals. This section sets forth the 
administrative appeals mechanism with regard to licensing and 
enforcement actions.
    Section 960.11. Conditions for Operation. This section sets forth 
the conditions for operation of all systems licensed under these 
regulations and includes NOAA's requirement to protect national 
security concerns, foreign policy and international obligations of the 
United States. In furtherance of these obligations, the license 
contains rigorous conditions on the operation of a system, including 
the requirement that the licensee maintain operational control of its 
system from a U.S. territory at all times and incorporate safeguards to 
ensure the integrity of system operations. In particular, it is 
important to note that the license requirement imposed on the licensee 
that it maintain ``operational control,'' as the term is defined in 
Section 960.3, is an implementation of U.S. obligations under the 
United Nations Outer Space Treaty of 1967. That treaty provides that 
the U.S. Government, as a State party, will be held strictly liable for 
any U.S. private or governmental entity's actions in outer-space. 
Consequently, NOAA requires that licensees under this part maintain 
ultimate control of their systems, in order to minimize the risk of 
such liability and assure that the national security concerns, foreign 
policy and international obligations of the United States are 
protected.
    In determining what constitutes operational control, NOAA has moved 
away from a percentage formula of foreign ownership and has instead 
imposed a requirement that operational control of the system be based 
within the territorial jurisdiction of the United States including U.S. 
territories and protectorates. The Secretary may also examine the level 
of administrative control of a licensee exercised by foreign investors, 
including whether the respective controlling investment was a foreign 
merger, acquisition or takeover of a U.S. company that was reviewed by 
the Committee on Foreign Investment in the United States (CFIUS) under 
section 721 of the Defense Production Act.
    In addition, Section 960.11 requires the licensee to maintain and 
make available to the U.S. Government, upon request, various records of 
operations for the previous year, and allow the Secretary of Commerce 
or his or her designee to inspect such records at all reasonable times, 
as described in the license.
    As part of the reporting and recordkeeping requirements imposed by 
the license, the licensee is expected to provide various data as 
verification of compliance with the operating restrictions detailed in 
the operating license. In addition, monitoring and compliance 
requirements are imposed within the license such as quarterly 
reporting, on-site inspections and appropriate records review. Finally, 
the license sets forth reporting requirements for both publicly-traded 
and privately-held companies. Licensees that are registered pursuant to 
the Securities Exchange Act of 1934 (Exchange Act) may submit copies of 
their Securities and Exchange Commission (SEC) forms 10-K and 10-Q to 
fulfill this requirement. Licensees that are not registered pursuant to 
the Exchange Act must include, in their quarterly and annual reports, 
applicable information listed in the SEC's 10K and 10Q forms.

Monitoring and Compliance Program

    Consistent with the requirements outlined in Section 960.11 and 
NOAA's monitoring and compliance program under these regulations, the 
following information shall be filed by the licensee, in order to 
evaluate its compliance with the provisions of its private remote 
sensing space system license. Data provided must be in sufficient 
detail to enable the Secretary to determine whether the licensee's 
actions meet the requirements of the Act, these regulations, and the 
license. Additional information may be required.

Section I--Annual Compliance Audit

    An on-site audit shall be conducted at least annually, following 
the issuance of a license, to confirm the licensee's compliance with 
the national security, foreign policy, and international obligations of 
the United States and compliance with all other license conditions. 
This audit shall review, for example, any changes to corporate 
structure, board membership (including citizenship), ownership, and 
financial investments. The audit will also include Securities and 
Exchange Commission filings. In the event that the licensee is not a 
publicly-traded company, the licensee must provide applicable 
information required by the SEC in the 10K and 10Q forms. The Annual 
Compliance Audit will also review agreements which impact the national 
security, foreign policy and international obligations of the United 
States, and the concept of operations. Additional information may be 
required.

Section II--Twelve Months Prior to Launch

    1. Submit plan for agency approval describing how licensee will 
comply with data collection restrictions, operational limitations, or 
any data protection plans, as required.
    2. Submit operations plan for restricting collection and/or 
dissemination of imagery of Israeli territory to that which is no more 
detailed or precise than what will be available from non-U.S. 
commercial sources during the time of the licensee's planned 
operations.

Section III--No Later Than Six Months Prior To Launch

    1. Submit a data flow diagram which graphically represents the data 
flow from the sensor to the final product delivery locations.
    2. Submit satellite sub-systems drawing showing the various sub-
system locations on the satellite.
    3. Submit a final imaging system specification document for each 
sensor. This must be coordinated with the imaging system contractor.

Section IV--When the Spacecraft is Declared Operational

Spacecraft designation number.
Orbital altitude.
Orbital inclination.
Spacecraft state of health.
Imaging system state of health.
Spatial Resolution.
Spectral Resolution.
On-orbit absolute geo-positioning accuracy.
Circular Error and Linear Error.

Section V--Quarterly Reporting

    1. Date, description, and corrective action performed for any 
anomalies or events which have caused the system to operate outside of 
license parameters and what action, if any, was performed to return the 
system to licensed baseline status.
    2. Estimated GSD of all images collected and disseminated on the 
State of Israel.

Section VI--Annual Operational Audit and Record Keeping

    In addition to the information required for the Annual Compliance 
Audit listed in Section I, all records and data from the previous 
twelve months pertaining to the following will be maintained by the 
licensee:
    1. Spacecraft telemetry.
    2. Imaging sensor(s) tasking and associated metadata to include 
date/time of collection, image number, imager used, image corner points 
in

[[Page 46826]]

latitude/longitude, inertial position (x,y,z), scan duration, azimuth. 
In addition, radar systems will include tasking and assorted meta data 
for phase history, grazing angle and polarization information.
    3. Imagery data purges and purge alerts provided to the National 
Satellite Land Remote Sensing Data Archive (the National Archive).

Purge Notifications to the National Archive

    Licensees are required to notify the National Archive of any data 
in its possession from its licensed remote-sensing space system that it 
intends to discard so that the Archive may acquire such data on 
reasonable cost terms as agreed by the licensee and the Archive. At the 
beginning of each quarter, licensees must notify the Archive of data 
sets it intends to purge for review by the National Archive.

Unenhanced Data

    When Congress removed the blanket nondiscriminatory data access 
requirement, it was careful to ensure that access to the unenhanced 
data would remain consistent with the United Nations' Principles on 
Remote Sensing, that the government of a sensed state should have 
timely access to all such data concerning its own territory. Section 
202(b)(2) of the 1992 Act requires that all licenses include the 
condition that the licensee shall make available upon request to the 
government of any country, including the United States, unenhanced data 
collected by the system concerning the territory under the jurisdiction 
of such government on reasonable commercial terms and conditions as 
soon as such data are available; consistent with the national security 
concerns, foreign policy and international obligations of the U.S.
    The regulations incorporate this requirement and consistent with 
this requirement, NOAA interprets the terms and conditions that are 
``reasonable'' in those cases where the data will not be made available 
on a nondiscriminatory basis. Making the data available to different 
classes of customers, e.g. non-commercial scientific and educational 
users, other public benefit users, commercial end users, and value-
added re-distributors, at different prices is reasonable.
    If a licensee intends to provide its unenhanced data on a 
restricted or exclusive basis, it becomes more difficult to determine 
what is ``reasonable'' vis-a-vis a sensed state. The price of these 
data, if measured in terms of their value to a particular commercial 
customer, may be prohibitive to a small government that simply wishes 
to monitor its own natural resources or to use the data, for example, 
for purposes of land use planning or to mitigate the effects of a 
recent natural disaster. On the other hand, the same price may be 
reasonable if the sensed state intends to use the data for competitive 
purposes. The reasonable commercial terms and conditions will have to 
be considered on a case-by-case basis. In any event, the sensed state 
has the opportunity to demonstrate that the terms result in an undue 
hardship.
    NOAA fully expects that a licensee's obligation to make unenhanced 
data available to the sensed state will in almost all instances be 
satisfied as a normal commercial transaction where the government of a 
sensed state is a regular customer. In those instances where the sensed 
state has not been able to satisfy its desire to acquire unenhanced 
data directly from the licensee, the sensed state shall make a formal 
written request to the Assistant Administrator including the specific 
information (i.e., geographic location, date) on the unenhanced data it 
desires to acquire.

Licensing of New or Advanced Systems

    As a general matter, the NOAA license covers the end-to-end 
operational capability of a remote sensing space system's ability to 
quantify information that includes, but is not limited to spatial, 
spectral, temporal, coherence, and polarization properties of 
reflected, transmitted, or emitted electromagnetic radiation.
    In issuing licenses for new and advanced technologies that have not 
previously been licensed by NOAA, NOAA may apply new license conditions 
to address the unique characteristics and attributes of these systems. 
For example, NOAA may grant a ``two-tiered'' license, allowing the 
licensee to operate its system at one level, available to all users, 
while reserving the full operational capability of that system for USG 
or USG-approved customers only. In some cases, the system may have a 
USG partnership client.
    Since the 1997 NPRM, NOAA has licensed space-based radar and 
hyperspectral systems. The conditions outlined in section 960.11 apply 
to all systems, including licensed space-based radar and hyperspectral 
systems. However, in issuing licenses for synthetic aperture radar and 
hyperspectral systems, conditions or specific limitations may be 
placed, as necessary, on operational parameters, design 
characteristics, and data throughput due to national security, foreign 
policy and international obligations.
    For synthetic aperture radar systems these include, but are not 
limited to:
    (1) resolution in terms of impulse response (IPR);
    (2) grazing angles;
    (3) geolocational accuracy;
    (4) multiple polarization;
    (5) system throughput (i.e., measurement of time during data 
collection, ground processing, and dissemination);
    (6) protection of phase history data;
    (7) location and function of non-U.S. operations centers and 
stations; and
    (8) protection of all uplinks and downlinks.
For hyperspectral systems these include, but are not limited to:
    (1) Spatial and spectral resolution;
    (2) Co-registration of hyperspectral data with data provided by 
other on-board sensors;
    (3) Operational wavelengths;
    (4) System throughput (i.e., measurement of time during data 
collection, ground processing, and dissemination);
    (5) Protection of remote sensing space system commanding, sensor 
tasking, and tasking information;
    (6) Protection of raw data;
    (7) Location and function of non-U.S. operations centers and 
stations; and
    (8) Protection of all uplinks and downlinks.

Reimbursements

    As allowed by Section 507 (d) of the Act, if additional technical 
modifications are imposed on a system operated under a previously 
granted license, on the basis of national security, the licensee may be 
reimbursed for those technical modifications. Generally, conditions in 
original licenses, previously-granted licenses or amendments that are 
the result of licensee initiated activities will not be considered for 
reimbursement. The Assistant Administrator, in consultation with the 
Secretary of Defense or other appropriate federal agencies, will 
determine whether actual modification costs or past development costs 
(including the cost of capital) incurred by the licensee shall be 
reimbursed by the government agency or agencies which requested such 
technical modifications. The costs and terms associated with meeting 
this condition will be negotiated directly between the licensee and the 
agency or agencies requesting the technical modifications. The loss of 
anticipated profits and the cost of security measures imposed on all 
licensees are not reimbursable.

[[Page 46827]]

Kyl-Bingaman Amendment

    Consistent with the requirement that licensees operate their 
systems in a manner that protects national security concerns, foreign 
policy and international obligations, Section 1064, Pub. L. No. 104-
201, (the 1997 Defense Authorization Act), referred to as the Kyl-
Bingaman Amendment, requires that ``[a] department or agency of the 
United States may issue a license for the collection or dissemination 
by a non-Federal entity of satellite imagery with respect to Israel 
only if such imagery is no more detailed or precise than satellite 
imagery of Israel that is available from commercial sources.''
    Pursuant to that law, the Department of Commerce will make a 
finding as to the level of detail or precision of satellite imagery of 
Israel available from commercial sources. Moreover, as the statutory 
limitation applies to U.S. licensees, the term ``commercial sources'' 
is interpreted for purposes of these regulations as referring to 
satellite imagery so readily and consistently available from non-U.S. 
commercial entities that the availability of additional imagery from 
U.S. commercial sources may be permitted.
    To interpret the term ``commercial availability'' of imagery of 
Israel from non-U.S. sources, NOAA looks to regulations of the Commerce 
Department's Bureau of Export Administration, concerning findings on 
foreign availability for export control purposes, as a model (See 15 
CFR 768). These regulations state that ``foreign availability exists 
when the Secretary [of Commerce] determines that an item is comparable 
in quality to an item subject to U.S. national security export 
controls, and is available-in-fact to a country, from a non-U.S. 
source, in sufficient quantities to render the U.S. export control of 
that item or the denial of a license ineffective.'' (See 15 CFR 
768.2(a)).
    Applying the above approach to implement the Kyl-Bingaman 
Amendment, the Department of Commerce will monitor the level of imagery 
resolution readily and consistently available in sufficient quantities 
from non-U.S. sources, to determine what imaging or data dissemination 
restrictions, if any, shall apply to licensees. A review of non-U.S. 
commercial availability will be conducted on an annual basis or more 
frequently if warranted. Input from licensees or from the general 
public is welcome to assist in this determination. Findings of this 
review will be published in the Federal Register and will constitute 
the data collection and/or dissemination restrictions with respect to 
imagery of Israel.
    As part of its licensing process, NOAA will require an applicant to 
submit a plan explaining how its proposed system will be able to 
restrict the collection and/or dissemination of imagery of Israeli 
territory at a level of resolution determined by the Commerce 
Department. NOAA will review this plan to ensure compliance.

Spacecraft Disposal and Orbital Debris Mitigation Plan

    As an additional licensing requirement, licensees shall, ``upon 
termination of operations under the license, make disposition of any 
satellites in space in a manner satisfactory to the President,'' in 
accordance with Section 202(b)(4) of the Act. Under Section 960.11 and 
the terms and conditions of the license, NOAA has interpreted this 
requirement to mean that a licensee shall assess and minimize the 
amount of orbital debris released during the post-mission disposal of 
its satellite. Applicants are required to provide at the time of 
application a plan for post-mission disposition of remote sensing 
satellites.
    The U.S. Government has developed orbital debris mitigation 
practices for use in government missions. These practices include 
control of orbital debris released during normal operations, 
minimization of debris generated by accidental explosions, selection of 
a safe flight profile and operational configuration, and post-mission 
disposal of space structures. NOAA will make available to applicants 
background information on three possible methods for post-mission 
disposal which are consistent with these practices: atmospheric re-
entry, maneuvering to a storage orbit, or direct retrieval. NOAA will 
review an applicant's plan for post-mission disposal on a case-by-case 
basis. NOAA will assess whether the plan, including satellite design 
and components, provide an acceptable post-mission disposal method to 
mitigate orbital debris and minimize any potential adverse effects. 
Applicants are specifically required to submit a casualty risk 
assessment if planned post-mission disposal involves atmospheric re-
entry of the spacecraft.
    Section 960.12 Data Policy for Remote Sensing Space Systems. This 
section describes various circumstances under which the licensee may be 
required, consistent with the terms of its license, to make available 
some or all of the unenhanced data from the system on a 
nondiscriminatory basis in accordance with Section 501 of the Act. For 
example, if the U.S. Government has (either directly or indirectly) 
funded some of the development, fabrication, launch, or operations 
costs of a licensed system, the Secretary of Commerce or his or her 
designee, in consultation with other appropriate U.S. agencies, must 
determine whether the interest of the United States, in promoting 
widespread availability of remote sensing data, requires that some or 
all of the unenhanced data from the system be made available on a 
nondiscriminatory basis in accordance with Section 501 of the Act. In 
addition, the license must specify any data subject to this 
requirement.
    The Act requires that an operator of a system that can be 
characterized as essentially a Governmental system, such as the Landsat 
system and those systems that are substantially funded by the U.S. 
Government, make its unenhanced data available on a nondiscriminatory 
basis, but allows the operator of a non-governmental system to follow 
normal commercial practices unless U.S. interests dictate otherwise. 
(See Sections 201(e), 202(b)(3), and 501).
    Section 960.13 of the regulations implements this provision 
consistent with the Act's overall objective of making data available to 
the widest possible spectrum of users, particularly for scientific 
purposes in support of the public benefit upon reasonable terms and 
conditions. This section addresses three categories of licensees. The 
first are those whose development, fabrication, launch, or operations 
costs have been funded, entirely or in substantial part, directly by 
the Government. As dictated by the Act, these operators must make their 
unenhanced data available on a nondiscriminatory basis. This 
requirement ensures that the data are broadly accessible and is 
consistent with the basic policy, codified in the Paperwork Reduction 
Act, 44 U.S.C. 3506 et seq. and included in Office of Management and 
Budget Circular A-130, that data paid for by the taxpayer is a public 
benefit to be made equally available to all members of the public.
    The second category of licensees are those that are fully 
commercial, i.e., not funded by the Government in whole or in part. 
These operators will be allowed to follow their preferred commercial 
data practices, subject to providing the unenhanced data to the 
governments of those states sensed, and consistent with concerns 
regarding U.S. national security, foreign policy, and international 
obligations, as discussed below. These licensees will be encouraged to 
promote access to their data on as widespread a basis as

[[Page 46828]]

possible and it is anticipated that, in most cases, there will be a 
commercial incentive to reach a broad customer base. It is recognized 
that in some cases, some of the data collected by such systems may not 
become generally accessible. However, NOAA believes that this loss will 
be outweighed by the substantially greater volume of data that will be 
collected by a vigorous commercial industry. It should be noted that 
limited purchases by the U.S. Government, as a normal customer of the 
licensee, would not constitute funding or support for purposes of this 
section.
    The third category of licensees consists of those systems in which 
the U.S. Government provides some support. Here, the Government's 
interest is more significant, because of taxpayer investment and the 
possible precedential effect of permitting restricted access to the 
data through international data exchange involving government 
subsidized public-private ventures. The data policy applicable to these 
licensees will be determined on a case-by-case basis, balancing the 
effect on the licensee of limiting its commercial options against the 
potential benefits of providing widespread access of the data for non-
commercial scientific, educational and other public benefit purposes. 
In evaluating the potential for data loss, NOAA will consider both the 
data to be gathered by the particular licensee as well as the possible 
implications for future intergovernmental data exchanges.
    It is anticipated that the U.S. Government interest in making the 
data available can usually be addressed through terms and conditions in 
the license that do not require a full nondiscriminatory data access 
policy. For example, it may be possible to accommodate such interests 
by ensuring access for non-commercial scientific, educational, and 
other public good purposes, while protecting a licensee's commercial 
options.

5. Subpart C--Prohibitions

    Section 960.13  Prohibitions. This section sets forth the 
prohibitions under these regulations. Under this section, it is 
unlawful for any person who is subject to the jurisdiction or control 
of the United States, directly or through any subsidiary or affiliate 
to, among other things: (a) operate a system without possession of a 
valid license issued under the Act and these regulations; (b) violate 
any provision of the Act, these regulations or any term, condition, or 
restriction of the license; (c) violate any order, directive, or other 
notice issued by the Secretary; and/or (d) interfere with the 
enforcement of this Part.

6. Subpart D--Enforcement Procedures

    Section 960.14  Civil Penalties. Generally, this section states 
that any person found to be in violation of the Act, this part, or any 
license issued under this part, will be subject to the civil penalty 
provisions prescribed in the Act, 15 CFR 904 (Civil Procedures) and 
other applicable laws.

7. Appendices

    Appendix 1--Application Information. This Appendix contains the 
information requirements of the license application as discussed in 
Section 960.4. Pursuant to the Paperwork Reduction Act, we are asking 
for comments to this Appendix.
    Appendix 2--Fact Sheet Regarding the Memorandum of Understanding 
Concerning the Licensing of Private Remote Sensing Satellite Systems. 
The Departments of State, Defense, Interior, Commerce, and the 
Intelligence Community, with the participation of OSTP and the NSC, 
concluded an interagency MOU concerning the Licensing of Private Remote 
Sensing Space Systems. On February 2, 2000, a Fact Sheet on the 
Interagency MOU was released. This Fact Sheet is included as Appendix 
2. The MOU is not within the scope of this rulemaking. Appendix 2 is 
not subject to public comment.

Classification

A. Regulatory Flexibility Act (5 U.S.C. 601 et seq.)

    These regulations establish a process intended to promote the 
development of the remote sensing industry and to minimize any adverse 
impact on any entity, large or small, that may seek a license to 
operate a private remote sensing space system.
    Accordingly, the Assistant General Counsel for Legislation and 
Regulation of the Department of Commerce certified to the Chief Counsel 
for Advocacy of the Small Business Administration that this rule will 
not have a significant economic impact on a substantial number of small 
entities. The basis for this confirmation was on the fact that, given 
extraordinary capitalization required to operate a commercial remote 
sensing space system, costs of development and launch still remain 
high. As such, small entities have yet to enter this field and appear 
highly unlikely to do so. No comments were received regarding this 
certification. As a result, no final regulatory flexibility analysis 
was prepared.

B. Paperwork Reduction Act of 1995 (35 U.S.C. 3500 et seq.)

    This rule contains a collection-of-information requirement subject 
to the Paperwork Reduction Act (PRA) and which has received emergency 
approval by OMB under control number 0648-0174. NOAA intends to submit 
a clearance request to receive a three-year approval and is soliciting 
comments on that submission at this time using the same estimated 
reporting burden.
    Public reporting burden for these collection-of-information 
requirements are estimated to average: 40 hours per license 
application; 10 hours for license amendment submissions; 1 hour to 
provide an executive summary of a license application or amendment; 2 
hours for notification/submission of a foreign agreement; 2 hours for a 
notification of the demise of a system or a decision to discontinue 
system operations; 2 hours for notification of any operational 
deviation; 5 hours for a plan describing how the licensee will comply 
with data collection restrictions; 3 hours for an operations plan for 
restricting collection or dissemination of imagery of Israeli 
territory; 3 hours for a data flow diagram; 1 hour for a satellite sub-
systems drawing; 3 hours for a final imaging system specification 
document; 2 hours for submission of spacecraft operational information 
submitted when a spacecraft becomes operational; 2 hours for 
notification of deviation in orbit or spacecraft disposition; 3 hours 
for quarterly reports; 2 hours for purge notifications to the Archive; 
8 hours for annual compliance audits; and 10 hours for annual 
operational audits. No estimate is being given at this time to provide 
imagery data to the National Satellite Land Remote Sensing Data 
Archive. An estimate will be developed at a later date.
    Public reporting burden for this collection of information includes 
the time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
the collection of information. Public comment is sought regarding: 
Whether this proposed collection of information is necessary for the 
proper performance of the functions of the agency, including whether 
the information shall have practical utility; the accuracy of the 
burden estimate; ways to enhance the quality, utility, and clarity of 
the information to be collected; and ways to minimize the burden of the 
collection of information, including through the use of automated 
collection techniques or other forms of information technology.

[[Page 46829]]

Send comments regarding this burden estimate, or any other aspect of 
this data collection, including suggestions for reducing the burden to 
Charles Wooldridge, NOAA, National Environmental Satellite, Data, and 
Information Service, 1315 East-West Highway, Room 7311, Silver Spring, 
MD 20910.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB Control Number.

C. National Environmental Policy Act (42 U.S.C. 4321 et seq.)

    Publication of these regulations does not constitute a major 
federal action significantly affecting the quality of the human 
environment. Therefore, an environmental impact statement is not 
required.

D. Executive Order 12866, Regulatory Planning and Review

    This rule has been determined to be significant for purposes of 
Executive Order 12866.

List of Subjects in 15 CFR Part 960

    Administrative practice and procedure, Confidential business 
information, Penalties, Reporting and recordkeeping requirements, 
Satellites, Scientific equipment, Space transportation and exploration.

    Dated: July 19, 2000.
Gregory W. Withee,
Assistant Administrator for Satellite and Information Services.
    Accordingly, for the reasons set forth above, Part 960 of title 15 
of the Code of Federal Regulations is revised to read as follows:

PART 960--LICENSING OF PRIVATE REMOTE SENSING SYSTEMS

Subpart A--General
Sec.
960.1   Purpose.
960.2   Scope.
960.3   Definitions.
Subpart B--Licenses
960.4   Application.
960.5   Confidentiality of information.
960.6   Review procedures for license applications.
960.7   Amendments to licenses.
960.8   Notification of foreign agreements.
960.9   License term.
960.10   Appeals/hearings.
960.11   Conditions for operation.
960.12   Data policy for remote sensing space systems.
Subpart C--Prohibitions
960.13   Prohibitions.
Subpart D--Enforcement Procedures
960.14   In general.
960.15   Penalties and sanctions.

Appendix 1 to Part 960--Filing Instructions and Information To Be 
Included in the Licensing Application

Appendix 2 to Part 960--Fact Sheet Regarding the Memorandum of 
Understanding Concerning the Licensing of Private Remote Sensing 
Satellite Systems Dated February 2, 2000

    Authority: 15 U.S.C. 5624.

Subpart A--General


Sec. 960.1  Purpose.

    (a) The regulations in this part set forth the procedural and 
informational requirements for obtaining a license to operate a private 
remote sensing space system under Title II of the Land Remote Sensing 
Policy Act of 1992 (15 U.S.C. 5601 et seq.) (Public Law 102-555, 106 
Stat. 4163) and the President's Policy announced on March 10, 1994, 
entitled, ``U.S. Policy on Foreign Access to Remote Sensing Space 
Capabilities'' (PDD 23) (Available from NOAA, National Environmental 
Satellite Data and Information Service, 1335 East-West Highway, Room 
7311, Silver Spring, MD 20910). In addition, this part describes NOAA's 
regulation of such systems, pursuant to the Act and PDD 23. The 
regulations in this part are intended to:
    (1) Facilitate development of the commercial space remote sensing 
industry in the United States and promote the broad use of remote 
sensing data;
    (2) Preserve the national security of the United States;
    (3) Observe the foreign policies and international obligations of 
the United States;
    (4) Ensure that unenhanced data collected by licensed private 
remote sensing space systems concerning the territory of any country 
are made available to the government of that country upon its request, 
as soon as such data are available and on reasonable commercial terms 
and conditions as appropriate;
    (5) Ensure that remotely sensed data are widely available for 
research, particularly environmental and global change research; and
    (6) Maintain a permanent comprehensive U.S. government archive of 
global land remote sensing data for long-term monitoring and study of 
the changing global environment and other archival purposes.
    (b) In accordance with the Act and the PDD 23, decisions regarding 
the issuance of licenses and operational conditions (See subpart B of 
this part) will be made by the Secretary of Commerce, or his/her 
designee. Determinations of conditions to meet national security, 
foreign policy and international obligations are made by the 
Secretaries of Defense and State respectively. Determinations will be 
made in accordance with the process described in the Interagency MOU 
Fact Sheet contained in Appendix 2 of this part.


Sec. 960.2  Scope.

    (a) The Act and the regulations in this part apply to any person 
subject to the jurisdiction or control of the United States who 
operates or proposes to operate a private remote sensing space system, 
either directly or through an affiliate or subsidiary, and/or 
establishes substantial connections with the United States regarding 
the operation of a private remote sensing system.
    (b) In determining whether substantial connections exist with 
regard to a specific system, the factors NOAA may consider include, but 
are not limited to: the location of a system control center or 
operations centers and stations; the administrative control of the 
system; use of a U.S. launch vehicle; location or administrative 
control of ground receiving stations; the investment, ownership, or 
technology included in the system.
    (c) The regulations in this part apply to any action taken on or 
after August 30, 2000 with respect to any license, and to pre-existing 
licenses.
    (d) If any provision of the regulations in this part or the 
application thereof to any person or circumstance is held invalid, the 
validity of the remainder of the regulations in this part or the 
application of such provision to other persons and circumstances shall 
not be affected.
    (e) Issuance of a license under the regulations in this part does 
not affect the authority of any Department or Agency of the U.S. 
Government including, but not limited to, the Federal Communications 
Commission under the Communications Act of 1934 (47 U.S.C. 151 et 
seq.), the Department of Transportation under the Commercial Space 
Launch Act of 1984 (49 U.S.C. app.2601 et seq.), the Department of 
Commerce under the Export Administration Regulations (15 CFR parts 730-
774), or the Department of State under the Arms Export Control Act (22 
U.S.C. 2778) and the International Traffic in Arms Regulations (22 CFR 
parts 120-130).

[[Page 46830]]

Sec. 960.3  Definitions.

    For purposes of the regulations in this part, the following terms 
have the following meanings:
    Act means the Land Remote Sensing Policy Act of 1992 (Public Law 
102-555, 106 Stat. 4163) as amended by the 1998 Commercial Space Act 
(Public Law 105-303, 112 Stat. 2846), 15 U.S.C. 5601 et seq.
    Administrative control means the power or authority, direct or 
indirect, whether or not exercised through the legal or defacto 
ownership or possession thereof, ownership of voting securities of a 
licensee, or by proxy voting, contractual arrangements or other means, 
to determine, direct or decide matters affecting the operations of the 
system; specifically, to determine, direct, take, manage, administer, 
influence, reach, or cause decisions regarding the:
    (1) Sale, lease, mortgage pledge, or other transfer of any or all 
of the system or system control assets of the licensee, whether in the 
ordinary course of business or not;
    (2) Operation of the system(s), including but not limited to orbit 
maintenance and other housekeeping functions, tasking and tasking 
prioritization, data acquisition, data storage, data transmission, 
processing and dissemination;
    (3) Dissolution of the licensee;
    (4) Closing and/or relocation of the command and control center of 
the system;
    (5) Execution, substantive modification and/or termination or non-
fulfillment of any significant or substantial foreign agreement of the 
licensee regarding direct readout or tasking obligations; or
    (6) Amendment of the Articles of Incorporation or constituent 
agreement of the licensee with respect to the matters described in 
paragraphs (1) through (4) of this definition.
    Administrator means the Administrator of NOAA and Under Secretary 
of Commerce for Oceans and Atmosphere or his/her designee.
    Affiliate means any person: (1) Which owns or controls more than a 
5% interest in the applicant or licensee; or (2) Which is under common 
ownership or control with the applicant or licensee.
    Applicant means a person who has submitted an application for a 
NOAA license to operate a remote sensing space system.
    Archive means the National Satellite Land Remote Sensing Data 
Archive established by the Secretary of the Interior pursuant to the 
archival responsibilities defined in Section 502 of the Act.
    Assistant Administrator means the Assistant Administrator of NOAA 
for Satellite and Information Services or his/her designee.
    Authorized Officer means an individual designated by the Secretary 
of Commerce or his/her designee to enforce the regulations in this 
part.
    Basic data set means those unenhanced data generated by the Landsat 
system or by any remote sensing space system licensed under the Act 
that have been selected by the Secretary of the Interior to be 
maintained in the Archive, as described in Section 502(c) of the Act.
    Beneficial owner means any person who, directly or indirectly, 
through any contract, arrangement, understanding, relationship, or 
otherwise, has or shares: the right to exercise administrative control 
over a licensee; and the power to dispose of, or to direct the 
disposition of, any security interest in a license. All securities of 
the same class beneficially owned by a person, regardless of the form 
which such beneficial ownership takes, shall be aggregated in 
calculating the number of shares beneficially owned by such person. A 
person shall be deemed to be the beneficial owner of a security 
interest if that person has the right to acquire beneficial ownership, 
as defined in this definition, within sixty (60) days from acquiring 
that interest, including, but not limited to, any right to acquire 
beneficial ownership through: the exercise of any option, warrant or 
right; the conversion of a security; the power to revoke a trust, 
discretionary account, or similar arrangement; or the automatic 
termination of a trust, discretionary account or similar arrangement.
    License means a grant of authority under the Act by the 
Administrator to a person to operate a private remote-sensing space 
system.
    Licensee means a person who holds a NOAA license to operate a 
remote sensing space system.
    NOAA means the National Oceanic and Atmospheric Administration.
    Operate means to manage, run, authorize, control, or otherwise 
affect the functioning of a remote sensing space system, directly or 
through an affiliate or subsidiary. This includes:
    (1) Commanding, controlling, tasking, and navigation of the system; 
or
    (2) Data acquisition, storage, processing, and dissemination.
    Operational control means the ability to operate the system or 
override commands issued by any operations center or station.
    Orbital debris means all human-generated debris in Earth orbit. 
This includes, but is not limited to, payloads that can no longer 
perform their mission, rocket bodies and other hardware (e.g., bolt 
fragments and covers) left in orbit as a result of normal launch and 
operational activities, and fragmentation debris produced by failure or 
collision. Gases and liquids in free state are not considered orbital 
debris.
    Person means any individual (whether or not a citizen of the United 
States) subject to U.S. jurisdiction; a corporation, partnership, 
association, or other entity organized or existing under the laws of 
the United States; a subsidiary (foreign or domestic) of a U.S. parent 
company; an affiliate (foreign or domestic) of a U.S. company; or any 
other private remote sensing space system operator having substantial 
connections with the United States or deriving substantial benefits 
from the United States that support its international remote sensing 
operations sufficient to assert U.S. jurisdiction as a matter of common 
law.
    President's Policy means the President's Policy entitled, ``U.S. 
Policy on Foreign Access to Remote Sensing Space Capabilities'' 
announced on March 10, 1994 (PDD 23).
    Proprietary information means any business or trade secrets or 
commercial or financial information explicitly designated as 
proprietary or confidential by the submitter, the public release of 
which would cause substantial harm to the competitive position of the 
submitter. Once the information is publicly-released by the submitter, 
it is no longer considered proprietary.
    Remote sensing space system, Licensed system, or System means any 
device, instrument, or combination thereof, the space-borne platform 
upon which it is carried, and any related facilities capable of 
actively or passively sensing the Earth's surface, including bodies of 
water, from space by making use of the properties of the 
electromagnetic waves emitted, reflected, or diffracted by the sensed 
objects. For purposes of the regulations in this part, a licensed 
system consists of a finite number of satellites and associated 
facilities, including those for tasking, receiving, and storing data, 
designated at the time of the license application. Small, hand-held 
cameras shall not be considered remote sensing space systems.
    Secretary means the Secretary of Commerce.
    Security means any note, stock, treasury stock, bond, debenture, 
evidence of indebtedness, certificate of

[[Page 46831]]

interest or participation in any profit-sharing agreement, collateral 
trust certificate, pre-organization certificate or subscription, 
transferable share, investment contract, voting trust certificate, or 
certificate of deposit for a security; any put, call, straddle, option, 
or privilege on any security, certificate of deposit, or group or index 
of securities (including any interest therein or based on the value 
thereof); any put, call, straddle, option, or privilege entered into a 
national securities exchange relating to foreign currency; any interest 
or instrument commonly known as a ``security''; or any certificate of 
interest or participation in, temporary or interim certificate for, 
receipt for, guarantee of, or warrant or right to subscribe to or 
purchase, any of the foregoing.
    Significant or Substantial foreign agreement (also referred to in 
this part as foreign agreement or agreement) means an agreement with a 
foreign nation, entity, consortium, or person that provides for one or 
more of the following:
    (1) Administrative control which may include distributorship 
arrangements involving the routine receipt of high volumes of the 
system's unenhanced data;
    (2) Participation in the operations of the system;
    (3) Direct access to the system's unenhanced data; or
    (4) An equity interest in the licensee held by a foreign nation 
and/or person, if such interest equals or exceeds or will equal or 
exceed ten (10) percent of total outstanding shares, or entitles the 
foreign person to a position on the licensee's Board of Directors.
    Subsidiary means a person over which the applicant or licensee may 
exercise administrative control.
    Tasking means any action taken to command a remote sensing space 
system or its sensor to acquire data for transmission or storage on the 
satellite's recording subsystem. Such action can be in the form of 
commands sent to the system for execution or for storage in the 
satellite's memory for execution at a specified time or location within 
a given orbit.
    Under Secretary means the Under Secretary of Commerce for Oceans 
and Atmosphere and Administrator of NOAA or his/her designee.
    Unenhanced data means remote sensing signals or imagery products 
that are unprocessed or subject only to data preprocessing. Data 
preprocessing may include rectification of system and sensor 
distortions in remote sensing data as it is received directly from the 
satellite; registration of such data with respect to features of the 
Earth; and calibration of spectral response with respect to such data. 
It does not include conclusions, manipulations, or calculations derived 
from such data, or a combination of such data with other data. It also 
excludes phase history data for synthetic aperture radar systems or 
other space-based radar systems.

Subpart B--Licenses


Sec. 960.4  Application.

    No person subject to the jurisdiction and/or control of the United 
States may operate a private remote sensing space system without a 
license issued pursuant to this part.
    (a) Filing instructions, as well as a list of information to be 
included in the license application, are included in Appendix 1 of this 
part.
    (b) If information in an application becomes inaccurate or 
incomplete prior to issuance of the license, the applicant must, within 
14 days, file the new or corrected information with the Assistant 
Administrator. If new or revised information is filed during the 
application process, the Assistant Administrator shall, within fourteen 
(14) days, determine whether the deadline imposed by Section 201(c) of 
the Act and Sec. 960.6(a) must be extended to allow adequate review of 
the revised application and, if so, for how long.


Sec. 960.5  Confidentiality of information.

    (a) Any proprietary information contained in a license application 
or application for amendment and submitted to NOAA will be treated as 
business confidential or proprietary information, if that information 
is explicitly designated and marked as such by the submitter. This does 
not preclude the United States Government from citing information in 
the public domain provided by the licensee in another venue (e.g., the 
licensee's website or a press release).
    (b) Concurrently with the filing of a license application or an 
application for an amendment, the applicant or licensee shall provide 
the Assistant Administrator with a publicly-releasable summary of the 
application or amendment. This summary shall be available for public 
review at a location designated by the Assistant Administrator and 
shall include:
    (1) The name, mailing address and telephone number of the applicant 
and any affiliates or subsidiaries;
    (2) A general description of the system, its orbit(s) and the type 
of data to be acquired;
    (3) The name and address upon whom service of all documents may be 
made;
    (4) A general description of the information being modified by an 
amendment request.


Sec. 960.6  Review procedures for license applications.

    The following procedures are consistent and have been harmonized 
with those procedures, including time lines, described in the Fact 
Sheet, at Appendix 2 of this part, which governs in lieu of this 
section and Secs. 960.7 and 960.8 with respect to the process for 
reaching determinations of conditions necessary to meet national 
security, international obligations and foreign policy and which is 
outside the scope of the regulations in this part.
    (a) The Assistant Administrator shall within three (3) working days 
of receipt of an application, forward a copy of the application to the 
Department of Defense, the Department of State, the Department of the 
Interior, and any other Federal agencies determined to have a 
substantial interest in the license application. The Assistant 
Administrator shall advise such agencies of the deadline prescribed by 
paragraph (b) of this section to require additional information from 
the applicant. The Assistant Administrator shall make a determination 
to issue the license, in accordance with the Act and Sec. 960.1(b), 
within 120 days of its receipt. If a determination has not been made 
within 120 days, the Assistant Administrator shall inform the applicant 
of any pending issues and any action required to resolve them.
    (b) The reviewing agencies have ten (10) working days from receipt 
of application to notify the Assistant Administrator in writing whether 
the application omits any of the information listed in Appendix 1 of 
this part or whether additional information may be necessary to 
complete the application. If these agencies cannot complete their 
review in the time allotted, they must notify NOAA in writing of the 
additional time needed to complete review, not to exceed ten (10) 
working days. This notification shall state the specific reasons why 
the additional information is sought. The Assistant Administrator shall 
then notify the applicant, in writing, what information is required to 
complete the license application. The 120-day review period prescribed 
in Section 201(c) of the Act will be stopped until the Assistant 
Administrator determines that the license application is complete.
    (c) Within thirty (30) days of receipt of a complete application, 
as determined by the Assistant Administrator, each Federal agency 
consulted in paragraph (a) of this

[[Page 46832]]

section shall recommend, in writing, to the Assistant Administrator 
approval or disapproval of the application in writing. If a reviewing 
agency is unable to complete its review in thirty days, it is required 
to notify NOAA in writing of additional time necessary to complete the 
review.
    (d) If the license application is denied, the Assistant 
Administrator shall provide the applicant with written notification 
along with a concise statement of the facts in the record determined to 
support the denial. This denial will be considered final agency action 
twenty-one (21) days after the date the notice was mailed, unless the 
applicant files an appeal, as provided in Sec. 960.10.
    (e) The Assistant Administrator shall terminate the license 
application review process if:
    (1) The application is withdrawn before the decision approving or 
denying it is issued; or
    (2) The applicant, after receiving a request for additional 
information pursuant to paragraph (c) of this section, does not provide 
such information within the time stated in the request.
    (f) No license shall be granted by the Secretary unless the 
Secretary determines, in writing, that the applicant will comply with 
the requirements of the Act, any regulations issued pursuant to the 
Act, and that the granting of such license and the operation of the 
license and system by the licensee would be consistent with the 
national security interest, foreign policy and international 
obligations of the United States.


Sec. 960.7  Amendments to licenses

    (a) Prior to taking any of the following actions a licensee must 
obtain an amendment to the license:
    (1) assignment of any interest in or transfer of the license from 
one entity to another, renaming, or any change in identity of the 
license holder;
    (2) change in or transfer of administrative control;
    (3) change of operational control; or
    (4) deviation from orbital characteristics, performance 
specifications, data collection and exploitation capabilities, 
operational characteristics identified under Appendix 1.C(6) of this 
part, or any other change in license parameters.
    (b) Applications for an amendment to an existing license shall 
contain all relevant new information and shall be filed at the same 
address identified in Appendix 1 of this part. Amendment applications 
shall be filed in accordance with the procedures in Sec. 960.4 and 
Appendix 1 of this part for original license applications.
    (c) The Assistant Administrator, in consultation with other 
appropriate agencies, shall review amendment applications within 120 
days of the receipt of such completed applications. The Assistant 
Administrator shall advise such agencies of the deadline prescribed by 
paragraph (d) of this section to require additional information from 
the applicant. If a determination has not been made within 120 days, 
the Assistant Administrator shall inform the licensee of any pending 
issues and any actions necessary to resolve them.
    (d) The reviewing agencies have ten (10) working days from receipt 
of the amendment request to notify the Assistant Administrator in 
writing whether the request omits any of the information listed in 
Appendix 1 of this part or whether additional information may be 
necessary to complete the request. If these agencies cannot complete 
their review in the time allotted, they must notify NOAA in writing of 
the additional time needed to complete review, not to exceed ten (10) 
working days. This notification shall state the specific reasons why 
the additional information is sought. The Assistant Administrator shall 
then notify the licensee, in writing, what information is required to 
complete the amendment request. The 120 day review period prescribed in 
Section 201(c) of the Act will be stopped until the Assistant 
Administrator determines that the amendment request is complete.
    (e) Within thirty (30) days of receipt of a complete amendment 
application, as determined by the Assistant Administrator, each Federal 
agency consulted in paragraph (a) of this section shall recommend, in 
writing, to the Assistant Administrator approval or disapproval of the 
amendment application in writing.
    (f)(1) When the licensee is seeking an amendment in order to 
transfer administrative control or change in the participation of the 
operations of the system to a foreign person or nation, pursuant to 
paragraph (a)(2) of this section, the licensee must provide the 
following information:
    (i) the identity, residence and citizenship of the foreign 
person(s) or nation(s) who will acquire control;
    (ii) the applicant's proposed plan to ensure that the licensee will 
protect the operational control of the licensed system from foreign 
influence and prevent technology transfer that would adversely impact 
national security, foreign policy or international obligations; and
    (iii) such additional information as the Assistant Administrator 
may prescribe as necessary or appropriate to protect the national 
security, foreign policy or international obligations of the United 
States.
    (2) Such an amendment request will be reviewed to determine whether 
the foreign person(s) or nation(s) that will exercise administrative 
control of the licensee will take no action that impairs the national 
security interests, foreign policy or international obligations of the 
United States.
    (g) If the license amendment application is denied, the Assistant 
Administrator shall provide the applicant with written notification 
along with a concise statement of the facts in the record determined to 
support the denial. This denial will be considered final agency action 
twenty-one (21) days after the date the notice was mailed, unless the 
applicant files an appeal, as provided in Sec. 960.10.


Sec. 960.8  Notification of foreign agreements

    Pursuant to the Act, the 1998 Commercial Space Act and licenses 
issued under this part, licensees must notify the Assistant 
Administrator of any significant or substantial agreement that they 
intend to enter into with any foreign nation, entity, or consortium, 
not later than sixty (60) days prior to concluding the agreement.
    (a) Upon notification by a licensee, pursuant to Sec. 960.11(b)(5), 
the Assistant Administrator shall initiate review of the proposed 
agreement in light of the national security interests, foreign policy 
and international obligations of the U.S. Government.
    (b) The Assistant Administrator, in consultation with other 
appropriate agencies, will review the proposed foreign agreement. As 
part of this review, the Assistant Administrator will ensure that the 
proposed foreign agreement contains the appropriate provisions to 
ensure compliance with all requirements concerning national security 
interests, foreign policy and international obligations under the Act 
or the licensee's ability to comply with the Act, these regulations and 
the terms of the license, are appropriately accommodated in the 
proposed agreement. These requirements include:
    (1) The ability to implement, as appropriate, restrictions on the 
foreign party's acquisition and dissemination of imagery as imposed by 
the license or by the Secretary of Commerce;
    (2) The obligations of the licensee to provide access to data for 
the Archive; and
    (3) The obligations of the licensee to convey to the foreign party 
the license's

[[Page 46833]]

reporting and recordkeeping requirements and to facilitate any 
monitoring and compliance activities identified in the license.
    (c) Within thirty (30) days of receipt of the proposed agreement, 
other agencies reviewing the agreement will notify the Assistant 
Administrator that the proposed agreement sufficiently addresses the 
requirements in paragraph (b) of this section or identify what changes 
will need to be made to the agreement to meet these requirements.
    (d)(1) Within sixty (60) days of notification by the licensee, if 
the Assistant Administrator determines that a proposed agreement will 
impair his or her ability to enforce the Act, or the licensee's ability 
to comply with the Act, these regulations, or the terms or conditions 
of the license, the licensee will be notified which terms and 
conditions of the license are affected and, specifically, how the 
agreement impairs their enforcement.
    (2) The proposed agreement may not be implemented by the licensee 
until the licensee has been advised by the Assistant Administrator that 
the provisions of the proposed agreement are acceptable.
    (e) Following approval of the agreement, if the factual 
circumstances surrounding this transaction change, the licensee must 
notify NOAA within twenty-one (21) days of the change. The licensee's 
failure to notify NOAA in a timely manner may result in penalties for 
noncompliance being levied, pursuant to Section 203(a)(3) of the Act.
    (f) A licensee seeking to enter into a foreign agreement that would 
require the modification of the terms of an existing license shall also 
submit a license amendment request and the proposed foreign agreement 
shall be considered in the context of the amendment review process.


Sec. 960.9  License term.

    (a) Each license for operation of a system shall be valid for the 
operational lifetime of the system or until the Secretary determines 
that the licensee is not in compliance with the requirements of the 
Act, the regulations issued pursuant to the Act, the terms and 
conditions of the license, or that the licensee's activities or system 
operations are not consistent with the national security, foreign 
policy and international obligations of the United States.
    (b) The licensee shall notify the Assistant Administrator within 
seven (7) days of financial insolvency, dissolution, the demise of its 
system or of its decision to discontinue system operation. Upon 
notification, the Assistant Administrator will terminate the license. 
However, termination will not affect the obligations of the licensee 
with regard to provisions in its license, requiring the licensee to:
    (1) Provide data to the Archive for the basic data set;
    (2) Make data available to the Archive that the licensee intends to 
purge from its holdings;
    (3) Make data available to a sensed state; and
    (4) Restrict acquisition and dissemination of imagery as imposed by 
the license or by the Secretary of Commerce; and
    (5) Manage the re-entry segment, including but not limited to, the 
disposal of the system.


Sec. 960.10  Appeals/hearings.

    (a) An applicant or licensee may submit a written appeal to the 
Administrator involving the granting, denial, or conditioning of a 
license; a license amendment; a foreign agreement; or enforcement 
action under this part. The appeal must state the action(s) appealed, 
must set forth a detailed explanation of the reasons for the appeal, 
and must be submitted within twenty-one (21) days of the action 
appealed. The appellant may request a hearing on the appeal before a 
designated hearing officer.
    (b) The hearing shall be held no later than thirty (30) days after 
receipt of the appeal, unless the hearing officer extends the time. The 
appellant and other interested persons may appear personally or by 
counsel and submit information and present arguments, as determined 
appropriate by the hearing officer. Hearings may be closed to the 
public as necessary to protect classified or proprietary information. 
Hearings shall be transcribed, and transcripts made available to the 
public, as required by statute. Classified and proprietary information 
shall not be included in the public transcripts. Within thirty (30) 
days of the conclusion of the hearing, the hearing officer shall 
recommend a decision to the Administrator.
    (c) The hearing requested under paragraph (a) of this section may 
be granted unless the issues being appealed involve the conduct of 
military or foreign affairs functions. Determinations concerning 
limitations on data collection or distribution, license conditions, or 
enforcement actions necessary to meet national security concerns, 
foreign policies or international obligations are not subject to a 
hearing under this Section. A determination to deny an appeal/hearing 
on this basis shall constitute final agency action.
    (d) The Administrator may adopt the hearing officer's recommended 
decision or may reject or modify it. The Administrator will notify the 
appellant of the decision, and the reason(s) therefor, in writing, 
within thirty (30) days of receipt of the hearing officer's recommended 
decision. The Administrator's action shall constitute final Agency 
action.
    (e) Any time limit prescribed in this section may be extended for a 
period not to exceed thirty (30) days by the Administrator for good 
cause, upon his/her own motion or written request from the appellant.
    (f) The licensee shall be entitled to an expedited hearing on the 
review of a foreign agreement if the request is filed with the 
Administrator within seven (7) days of the date of mailing of the 
Assistant Administrator's notice under Sec. 960.8(d)(1). The request 
shall set forth the licensee's response to the determinations contained 
in the notice, and demonstrate that the time necessary to complete the 
normal hearing process will jeopardize the agreement.
    (1) Expedited hearings shall commence within five (5) days after 
the filing of the request with the Administrator unless the 
Administrator or the Hearing Officer postpones the date of the hearing 
or the parties agree that it shall commence at a later time.
    (2) Within five (5) days of the conclusion of the hearing, the 
Hearing Officer shall prepare findings and conclusions for 
consideration by the Administrator.
    (3) Within fourteen (14) days after receipt of such material, the 
Administrator shall issue his/her findings and conclusions and a 
statement of the reasons on which they are based. This decision 
constitutes final agency action.


Sec. 960.11  Conditions for operation.

    (a) Each license issued for the operation of a system shall require 
the licensee to comply with the Act and the regulations in this part. 
The licensee shall ensure that its license information is kept current 
and accurate. A licensee's failure to notify NOAA in a timely manner of 
any changes to that information on which the determination to issue the 
license or a subsequent licensing action was or will be made may result 
in penalties for noncompliance being levied, pursuant to Section 
203(a)(3) of Public Law 102-555.
    (b) The following conditions, as a minimum, shall be included in 
all licenses:
    (1) The licensee shall operate its system in a manner that 
preserves the

[[Page 46834]]

national security and observes the foreign policy and international 
obligations of the United States. Specific limitations on operational 
performance, including, but not limited to, limitations on data 
collection and dissemination, as appropriate, will be specified in each 
license.
    (2) The licensee shall maintain operational control from a location 
within the United States at all times, including the ability to 
override all commands issued by any operations centers or stations.
    (3) The licensee will maintain and make available to the Assistant 
Administrator records of system tasking, operations and other data as 
specified in the license for the purposes of monitoring and compliance. 
Periodic reporting and record keeping requirements will be specified in 
the license. The licensee shall allow the Administrator access, at all 
reasonable times, to all facilities which comprise the remote sensing 
space system for the purpose of conducting license monitoring and 
compliance inspections.
    (4) The licensee may be required by the Secretary to limit data 
collection and/or distribution by the system as determined to be 
necessary to meet significant national security or significant foreign 
policy concerns, or international obligations of the United States, in 
accordance with the procedures set forth in the Interagency MOU Fact 
Sheet. During such limitations, the licensee shall, on request, provide 
unenhanced restricted images on a commercial basis exclusively to the 
U.S. Government using U.S. government-approved rekeyable encryption on 
the down-link and shall use a data down-link format that allows the 
U.S. Government access to these data during such periods.
    (5) A licensee shall notify the Administrator of its intent to 
enter into any significant or substantial foreign agreement, and shall 
submit this agreement for review in accordance with Sec. 960.8. The 
proposed agreement may not be implemented by the licensee until the 
licensee has been advised by the Administrator that the document's 
provisions are acceptable.
    (i) Notification of any agreement that provides for an on-going or 
a continuous relationship serves as notification of specific 
transactions carried out within the scope of that agreement for 
purposes of the regulations in this part and the Act. Such notification 
does not relieve a licensee of any obligation under any other laws 
including U.S. export laws or regulations to secure necessary USG 
authorizations and/or licenses, to provide notification, or to comply 
with other requirements.
    (ii) A licensee seeking to enter a foreign agreement that would 
require the modification of the terms of an existing license shall 
submit a license amendment, as provided in Sec. 960.7.
    (6) In accordance with Section 201 (e) of the Act and Sec. 960.12, 
a licensee shall make available on reasonable commercial terms and 
conditions, in accordance with the Act and Sec. 960.12, any unenhanced 
data designated by the Assistant Administrator.
    (7) A licensee shall provide to the U.S. Government, upon request, 
a complete list of all archived, unenhanced data which has been 
generated by its licensed system which is not already maintained in a 
public catalog. Any information on this list which is deemed 
proprietary by the licensee should be so noted by the licensee when the 
list is provided to the U.S. Government.
    (8) A licensee shall make available unenhanced data requested by 
the National Satellite Land Remote Sensing Data Archive (``the 
Archive'') in the Department of the Interior on reasonable cost terms 
and conditions as agreed by the licensee and the Archive. After the 
expiration of any exclusive right to sell, or after a reasonable period 
of time, as agreed with the licensee, the Archive shall make these data 
available to the public at a price equivalent to the cost of fulfilling 
user requests.
    (9) Before purging any licensed data in its possession, the 
licensee shall offer such data to the Archive at the cost of 
reproduction and transmission. The Archive shall make these data 
available immediately to the public at a price equivalent to the cost 
of fulfilling user requests.
    (10) A licensee shall make available to the government of any 
country (including the United States) upon request by that government, 
unenhanced data collected by its system concerning the territory under 
the jurisdiction of such government. The data shall be provided as soon 
as the licensee is able to distribute the data commercially or as soon 
as the licensee has processed them into a format that the licensee uses 
for its own purposes, whichever occurs sooner, on reasonable terms and 
conditions. However, no data shall be provided to the sensed state if 
such release is contrary to U.S. national security concerns, foreign 
policy or international obligations or is otherwise prohibited by law, 
e.g. where transactions with the sensed state are prohibited by the 
laws of the United States. The USG may require, as a specific license 
condition, coordination with NOAA prior to fulfilling specific sensed 
state requests for unenhanced data.
    (11) A licensee shall inform the Assistant Administrator 
immediately of any operational deviation or proposed deviation of the 
system which would violate the conditions of the license. If advance 
notice is not possible because of an emergency posing an imminent and 
substantial threat to human life, property, the environment or the 
system itself, the licensee shall notify the Assistant Administrator of 
the deviation as soon as circumstances permit.
    (12) A licensee shall dispose of any satellites operated by the 
licensee upon termination of operations under the license in a manner 
satisfactory to the President. The licensee shall obtain approval from 
the Assistant Administrator of all plans and procedures for the 
disposition of satellites as part of the application process.


Sec. 960.12  Data policy for remote sensing space systems.

    (a) In accordance with the Act, if the U.S. Government has or will 
directly fund all or a substantial part of the development, 
fabrication, launch, or operation costs of a licensed system, the 
license shall require that all of the unenhanced data from the system 
be made available on a nondiscriminatory basis except on the basis of 
national security, foreign policy or international obligations.
    (b) If the U.S. Government has not funded and will not fund, either 
directly or indirectly, any of the development, fabrication, launch, or 
operations costs of a licensed system, the licensee may provide access 
to its unenhanced data in accordance with reasonable commercial terms 
and conditions, subject to the requirement of providing data to the 
government of any sensed state, pursuant to Sec. 960.11(b)(10), and to 
implementation of the licensee's plan, as contained in its application, 
to provide widespread access to its unenhanced data for non-commercial 
scientific, educational or other public benefit purposes.
    (c) If the U.S. Government has (either directly or indirectly) 
funded some of the development, fabrication, launch, or operations 
costs of a licensed system, the Assistant Administrator, in 
consultation with other appropriate U.S. agencies, shall, subject to 
national security concerns, determine whether the interest of the 
United States in promoting widespread availability of remote sensing 
data on reasonable cost terms and conditions requires that some or all 
of the unenhanced data from the

[[Page 46835]]

system be made available on a nondiscriminatory basis in accordance 
with the Act. The license shall specify any data subject to this 
requirement. In making this determination, the Assistant Administrator 
may consider:
    (1) The extent and proportion of private and federal funding of the 
system;
    (2) The extent of the governmental versus the commercial market for 
the unenhanced data;
    (3) The effect of a nondiscriminatory data access designation on 
the applicant's commercial activity;
    (4) The extent to which the applicant's proposed commercial data 
policies would encourage foreign operators to limit access, 
particularly for research and public benefit purposes; or
    (5) The extent to which the U.S. interest in promoting widespread 
data availability can be satisfied through license conditions that 
ensure access to the data for scientific, educational, or other public 
benefit purposes.

Subpart C--Prohibitions


Sec. 960.13  Prohibitions.

    It is unlawful for any person who is subject to the jurisdiction or 
control of the United States, directly or through any subsidiary or 
affiliate to:
    (a) Operate a private remote sensing space system in such a manner 
as to jeopardize the national security or foreign policy and 
international obligations of the United States;
    (b) Operate a private remote sensing space system without 
possession of a valid license issued under the Act and/or the 
regulations in this part;
    (c) Operate a private remote sensing space system in violation of 
the terms and conditions of the license issued for such system under 
the Act and the regulations in this part;
    (d) Violate any provision of the Act or the regulations in this 
part or any term, condition, or restriction of the license;
    (e) Violate or fail to comply with any order, directive, or notice 
issued by the Secretary or his/her designee, pursuant to the Act and/or 
the regulations in this part, with regard to the operation of the 
licensed private remote sensing space system;
    (f) Fail or refuse to provide to the Secretary or his/her designee 
all reports and/or information required to be submitted to the 
Secretary under the Act or the regulations in this part;
    (g) Fail to update the information required to be submitted to the 
Secretary in the license application; or
    (h) Interfere with the enforcement of this part by:
    (1) Refusing to permit access by the Secretary or his/her designee 
to any facilities which comprise the remote sensing space system for 
the purposes of conducting any search or inspection in connection with 
the enforcement of the regulations in this part;
    (2) Assaulting, resisting, opposing, impeding, intimidating, or 
interfering with any authorized officer in the conduct of any search or 
inspection performed under the regulations in this part;
    (3) Submitting false information to the Secretary, his/her designee 
or any authorized officer; or
    (4) Assaulting, resisting, opposing, impeding, intimidating, 
harassing, bribing, or interfering with any person authorized by the 
Secretary or his/her designee to implement the provisions of the 
regulations in this part.

Subpart D--Enforcement Procedures


Sec. 960.14  In general.

    (a) The Secretary shall conduct such enforcement activities as are 
necessary to carry out his/her obligations under the Act.
    (b) Any person who is authorized to enforce the regulations in this 
part may:
    (1) Enter, search and inspect any facility suspected of being used 
to violate the regulations in this part or any license issued pursuant 
to the regulations in this part and inspect and seize any equipment or 
records contained in such facility;
    (2) Seize any data obtained in violation of the regulations in this 
part or any license issued pursuant to the regulations in this part;
    (3) Seize any evidence of a violation of the regulations in this 
part or of any license issued pursuant to the regulations in this part;
    (4) Execute any warrant or other process issued by any court of 
competent jurisdiction; and
    (5) Exercise any other lawful authority.


Sec. 960.15  Penalties and sanctions.

    As authorized by Section 203(a) of the Act, if the Secretary or 
his/her designee determines that the licensee has substantially failed 
to comply with the Act, the regulations in this part, or any term, 
condition or restriction of the license, the Secretary or his/her 
designee may request the appropriate U.S. Attorney to seek an order of 
injunction or similar judicial determination from the U.S. District 
Court for the District of Columbia Circuit or a U.S. District Court 
within which the licensee resides or has its principal place of 
business, to terminate, modify, or suspend the license, and/or to 
terminate licensed operations on an immediate basis.
    (a) In addition, any person who violates any provision of the Act, 
any license issued thereunder, or the regulations in this part may be 
assessed a civil penalty by the Secretary of not more that $10,000 for 
each violation. Each day of operation in violation constitutes a 
separate violation. All civil penalties procedures shall be in 
accordance with 15 CFR part 904.
    (b) Violation of the Act, this part, or any license issued under 
this part, may be subject to criminal penalty provisions prescribed in 
other applicable laws.

Appendix 1 to Part 960--Filing Instructions and Information To Be 
Included in the Licensing Application

    (a) Where to file. Applications and all related documents shall 
be filed with the Assistant Administrator, National Environmental 
Satellite, Data and Information Service (NESDIS), NOAA, Department 
of Commerce, 1335 East West Highway, Silver Spring, Maryland 20910.
    (b) Form. No particular form is required but each application 
must be in writing, must include all of the information specified in 
this subpart, and must be signed by an authorized principal 
executive officer. In addition, applicants must submit a copy on 
electronic media using commonly-available commercial word processing 
software.
    (c) Number of copies. One (1) copy of each application must be 
submitted in a readily reproducible form accompanied by a copy on 
electronic media. One (1) copy of the public summary required by 
Sec. 960.5(b) must also be submitted in a readily reproducible form 
accompanied by a copy on electronic media.
    (d) The following information shall be filed by the applicant in 
order to evaluate its suitability to hold a private remote sensing 
space system license. Data provided regarding the applicant's 
proposed remote sensing space system must be in sufficient detail to 
enable the Secretary to determine whether the proposal meets 
requirements of the Act.
    Sec. I--Corporate Information
    (1) The name, street address and mailing address, telephone 
number and citizenship(s) of (as applicable):
    (i) Applicant as well as any affiliates or subsidiaries;
    (ii) Chief executive officer of the applicant and each director;
    (iii) Each general corporation partner;
    (iv) All executive personnel or senior management of a 
partnership;
    (v) Any directors, partners, executive personnel or senior 
management who hold positions with or serve as consultants for any 
foreign nation or person;
    (vi) Each domestic beneficial owner of an interest equal to or 
greater than 10 percent in the applicant;
    (vii) Each foreign owner of an interest equal to or greater than 
5 percent in the applicant;
    (viii) Each foreign lender and amount of debt where foreign 
indebtedness exceeds 25 percent of an applicants total indebtedness;

[[Page 46836]]

    (ix) A person upon whom service of all documents may be made.
    (2) A description of any significant or substantial agreements 
between the applicant, its affiliates and subsidiaries, with foreign 
nation or person, including copies if available;
    (3) A copy of the charter or other authorizing instrument 
certified by the jurisdiction in which the applicant is incorporated 
or organized and authorized to do business.
    Sec. II--Launch Segment Information
    Provide the characteristics of the launch segment to include:
    (1) proposed launch schedule;
    (2) proposed launch vehicle source;
    (3) proposed launch site;
    (4) anticipated operational date;
    (5) the range of orbits and altitudes (nominal apogee and 
perigee);
    (6) inclination angle;
    (7) orbital period;
    Sec. III--Space Segment
    (1) the number of satellites which will compose this system;
    (2) provide technical space system information at the level of 
detail typical of a request for proposal specification;
    (3) Anticipated best theoretical resolution (show calculation);
    (4) Swath width of each sensor (typically at nadir);
    (5) the various fields of view for each sensor (IFOV, in-track, 
cross-track);
    (6) on-board storage capacity;
    (7) navigation capabilities--GPS, star tracker accuracies;
    (8) time-delayed integration with focal plane;
    (9) oversampling capability;
    (10) image motion parameters--linear motion, drift; aggregation 
modes;
    (11) anticipated system lifetime.
    Sec. IV--Ground Segment
    (1) The system data collection and processing capabilities 
proposed including but not limited to: tasking procedures; 
scheduling plans; data format (downlinked and distributed data); 
timeliness of delivery; ground segment information regarding the 
location of proposed operations centers and stations, and tasking, 
telemetry and control; data distribution and archiving plans;
    (2) The command (uplink and downlink) and mission data 
(downlink) transmission frequencies and system transmission (uplink 
and downlink) footprint, the downlink data rate, any plans for 
communications crosslinks;
    (3) The plans for protection of uplink, downlink and any data 
links;
    (4) The methods applicant will use to ensure the integrity of 
its operations, including plans for: positive control of the remote 
sensing space system and relevant operations centers and stations; 
denial of unauthorized access to data transmissions to or from the 
remote sensing space system; and restriction of collection and/or 
distribution of unenhanced data from specific areas at the request 
of the U.S. Government.
    Sec. V--Other Information
    A. The applicant's plans for providing access to or distributing 
the unenhanced data generated by the system including:
    (1) a description of the plan for the sale and distribution of 
such data;
    (2) the method for making the data available to governments 
whose territories have been sensed;
    (3) a description of the plans for making data requested and 
purchased by the Department of the Interior available to the Archive 
for inclusion in the basic data set; and
    (4) the licensee's plans to make the data available for non-
commercial scientific, educational, or other public benefit 
purposes, such as the study of the changing global environment.
    B. If the applicant is proposing to follow a commercial data 
distribution and pricing policy as provided for by Sec. 960.12, the 
application shall include the following additional financial 
information:
    (1) the extent of the private investment in the system;
    (2) the extent of any direct funding or other direct assistance 
which the applicant or its affiliates or subsidiaries have received 
or anticipate receiving from any agency of the U.S. Government for 
the development, fabrication, launch, or operation of the system 
including direct financial support, loan guarantees, or the use of 
U.S. Government equipment or services;
    (3) any existing or anticipated contract(s) between the 
applicant, affiliate, or subsidiary and U.S. Government agencies for 
the purchase of data, information, or services from the proposed 
system;
    (4) any other relationship between the applicant, affiliate, or 
subsidiary and the U.S. Government which has supported the 
development, fabrication, launch, or operation of the system; and
    (5) any plans to provide preferred or exclusive access to the 
unenhanced data to any particular user or class of users.
    C. The applicant will submit a plan for post-mission disposition 
of any remote-sensing satellites owned or operated by the applicant. 
If the satellite disposition involves an atmospheric re-entry the 
applicant must provide an estimate of the total debris casualty area 
of the system's components and structure likely to survive re-entry.

Appendix 2 to Part 960--Fact Sheet Regarding the Memorandum of 
Understanding Concerning the Licensing of Private Remote Sensing 
Satellite Systems Dated February 2, 2000

The White House, Office of Science and Technology Policy and National 
Security Council

February 2, 2000.

FACT SHEET REGARDING THE MEMORANDUM OF UNDERSTANDING CONCERNING THE 
LICENSING OF PRIVATE REMOTE SENSING SATELLITE SYSTEMS

    A Memorandum of Understanding (MOU) has been concluded between 
the Departments of Commerce, State, Defense, Interior and the 
Intelligence Community regarding interagency procedures on 
commercial remote sensing systems.

Background

    The Secretary of Commerce, through the National Oceanic and 
Atmospheric Administration, is responsible for administering the 
licensing of private remote sensing satellite systems pursuant to 
the Land Remote Sensing Policy Act of 1992. The Act also grants to 
the Secretaries of State and Defense the authority to determine 
conditions necessary to protect international obligations, foreign 
policy concerns, and national security concerns. The purpose of the 
MOU is to establish interagency procedures concerning the process 
for handling remote sensing licensing actions, and consultation 
regarding interruption of normal commercial operations consistent 
with the President's policy on remote sensing.
    In consultation with affected agencies, limitations on 
commercial remote sensing systems will be imposed by the Secretary 
of Commerce when necessary to meet international obligations and 
national security and foreign policy concerns and will be in accord 
with the determinations of the Secretary of Defense and the 
Secretary of State and with applicable law. Procedures for 
implementing this policy are set out below.

Procedures

A. Consultation during Review of Licensing Actions.

    Pursuant to section 5621(c) of the Land Remote Sensing Policy 
Act of 1992, the Secretary of Commerce shall review any application 
and make a determination thereon within 120 days of receipt of such 
application. If final action has not occurred within such time, then 
the Secretary shall inform the applicant of any pending issues and 
of actions required to resolve them. Copies of requests for 
licensing actions received by the Department of Commerce (DOC) will 
be provided by DOC to the Department of State (DOS), the Department 
of Defense (DOD), the Department of the Interior (DOI), and the 
Intelligence Community (IC) within 3 working days.
    DOC will defer its decision on such licensing actions until the 
other Parties concerned have had a reasonable time to review them, 
as provided in this section.
    (1) Within 10 working days of receipt, DOS, DOD, DOI, or IC 
shall notify the Department of Commerce, in writing, of any 
additional information it believes is necessary to properly evaluate 
the licensing action, or notify DOC in writing of the additional 
time, not to exceed 10 working days, necessary to complete the 
review. This notification shall state the specific reasons why the 
additional information is sought.
    (2) After receiving a complete license package or the 
information requested in paragraph (1), DOS, DOD, DOI, and IC will 
complete their review of the license package within 30 days or 
notify DOC in writing of additional time necessary to complete the 
review. If DOS, DOD, or IC conclude that imposition of conditions on 
the actions being reviewed may be necessary to protect international 
obligations, foreign policy concerns, or national security concerns, 
the agency identifying the concern will promptly notify DOC in 
writing with a copy to other

[[Page 46837]]

interested agencies. Such notification shall: (i) describe the 
national security interests, or the international obligations or 
specific foreign policies at risk if the applicant's system is 
approved as proposed; (ii) set forth in detail the basis for the 
conclusion that operation of the applicant's system as proposed will 
not preserve the national security interests or the international 
obligations or specific foreign policies identified; and (iii) 
specify the additional conditions necessary to preserve the relevant 
United States interests or set forth in detail why denial is 
required to preserve such interests.
    (3) Within 10 days of sending this notification, representatives 
of DOS, DOD, DOC, DOI, and IC will meet to discuss and resolve any 
issues with regard to these proposed conditions.
    (4) If, after such discussions, DOS or DOD conclude that such 
conditions are necessary but DOC does not concur, the Secretary of 
State or the Secretary of Defense may make such a determination of 
necessary conditions in writing. This function may not be delegated 
below the acting Secretary or the Deputy Secretary. Such 
determinations will be promptly forwarded to DOC and a copy will be 
provided to the Assistant to the President for National Security 
Affairs and the Assistant to the President for Science and 
Technology.
    (5) Upon notification of such a determination, DOC will suspend 
any further action on the license that would be inconsistent with 
the DOS or DOD determination. If the Secretary of Commerce believes 
the limits defined by another Secretary are inappropriate, the 
Secretary of Commerce or Deputy Secretary shall then consult with 
his or her counterpart in the relevant department within 10 days 
regarding any unresolved issues. If the relevant Secretaries are 
unable to resolve any issues, the Secretary of Commerce will so 
notify the Assistant to the President for National Security Affairs, 
who, in coordination with the Assistant to the President for Science 
and Technology, will seek to achieve a consensus within the 
interagency, or failing that, by referral to the President. All 
efforts will be taken to resolve the dispute within 3 weeks of its 
submission to the Assistant to the President for National Security 
Affairs and the Assistant to the President for Science and 
Technology.

B. Consultation Regarding Interruption of Normal Commercial Operations

    (1) This section establishes the process for requiring the 
licensee to limit data collection and/or distribution by the system 
during periods when national security or international obligations 
and/or foreign policies may be compromised, as determined by the 
Secretary of Defense or the Secretary of State. DOC will provide to 
the other Parties copies of licensee correspondence and documents 
that describe how the licensee will comply with such interruptions 
of its commercial operations.
    (2) Conditions should be imposed for the smallest area and for 
the shortest period necessary to protect the national security, 
international obligations, or foreign policy concerns at issue. 
Alternatives to prohibitions on collection and/or distribution shall 
be considered such as delaying the transmission or distribution of 
data, restricting the field of view of the system, encryption of the 
data if available, or other means to control the use of the data.
    (3) Except where urgency precludes it, DOS, DOD, DOC and IC will 
consult to attempt to come to an agreement concerning appropriate 
conditions, if any, to be imposed on the licensee in accordance with 
determinations made by DOS or DOD. Consultations shall be 
constructed so that, in the event an agreement cannot be reached at 
the staff level, sufficient time will remain to allow the Secretary 
of Commerce to consult personally with the Secretary of State or the 
Secretary of Defense, as appropriate, prior to the issuance of a 
determination by the Secretary of State or the Secretary of Defense 
in accordance with (4) below. That function shall not be delegated 
below the acting Secretary.
    (4) After such consultations, or when the Secretary of State or 
the Secretary of Defense specifically determines that urgency 
precludes consultation with the Secretary of Commerce, the Secretary 
of State or the Secretary of Defense, shall determine the conditions 
necessary to meet international obligations, significant foreign 
policy concerns, or significant national security concerns, 
especially where those interests identified in the National Security 
Strategy would be put at risk. This function shall not be delegated 
below the acting Secretary. The Secretary of State or the Secretary 
of Defense will provide to the Secretary of Commerce his or her 
determination regarding the conditions required to be imposed on the 
licensee. The determination will describe the international 
obligations, specific foreign policy, or national security interest 
at risk. Upon receipt of the determination, DOC shall immediately 
notify the licensee of the imposition of limiting conditions on 
commercial operations. Copies of the determination and any 
implementing DOC action will be provided promptly to the Assistant 
to the President for National Security Affairs and the Assistant to 
the President for Science and Technology.
    (5) If the Secretary of Commerce believes the conditions 
determined by another Secretary are inappropriate, he or she will, 
simultaneous with notification of, and imposition of such conditions 
on, the licensee, so notify the Secretary of Defense or the 
Secretary of State, as appropriate, the Assistant to the President 
for National Security Affairs, and the Assistant to the President 
for Science and Technology. The Assistant to the President for 
National Security Affairs, in coordination with the Assistant to the 
President for Science and Technology, will initiate as soon as 
possible a Principals-level consultative process to achieve a 
consensus within the interagency, or, failing that, refer the matter 
to the President for decision. All efforts will be taken to resolve 
the disagreement within 7 working days of its submission to the 
Assistant to the President for National Security Affairs and the 
Assistant to the President for Science and Technology.

C. Coordination Before Release of Information Provided or Generated by 
Other Agencies

    Before releasing any information provided or generated by 
another agency to a licensee or potential licensee, to the public, 
or to an administrative law judge, each agency agrees to consult 
with the agency that provided or generated the information. The 
purpose of such consultations will be to review the propriety of any 
proposed release of information that may be privileged because it is 
classified, pre-decisional, deliberative, contain proprietary 
information, or is protected for other reasons. No information shall 
be released without the approval of the agency that provided or 
generated it unless required by law.

D. No Legal Rights or Remedies, or Legally Enforceable Causes of 
Action, are Created or Intended to be Created by the MOU.

[FR Doc. 00-18725 Filed 7-28-00; 8:45 am]
BILLING CODE 3510-HR-P