Last December, right before Christmas, the Federal Communications Commission (FCC) dropped a regulatory bombshell on the drone industry. All foreign-produced unmanned aircraft systems (UAS) and UAS critical components now sit on its Covered List of equipment deemed to present national security risks. The move caught even seasoned industry players off guard. The compliance clock is already ticking. During a special Law Tech Connect 2026 Preview Webinar, we walked through the 10 most pressing questions drone manufacturers and integrators need answered before they find themselves on the wrong side of this sweeping new regime. Here’s the breakdown.
Q1: Why Does the FCC Control What Drones Enter the U.S. Market?
The FCC’s authority stems from something most drone operators have long taken for granted: every device that intentionally or unintentionally radiates radio frequency (RF) energy requires an equipment authorization before it can be imported, marketed or sold in the United States.
That authority has been sitting in the regulatory background for decades. This last regulatory check by the FCC over equipment authorizations is a very powerful tool. It has now become one of Washington’s most powerful tools for controlling the national security supply chain.
The FCC and Congress began leveraging this authority in 2021 with an initial ban of Chinese telecom equipment from Huawei and ZTE. UAS followed. Routers are already in the crosshairs. Robotics are likely next.
For the drone industry, the December 22, 2025 rule marks the start of new regulatory hurdles that have no parallel in the sector’s history. Before the December 2025 expansion, most covered entities were companies Congress had specifically identified: Huawei, ZTE, Dahua, China Mobile, and most visibly in the drone space, DJI and Autel. The critical difference now is that the list covers every foreign-produced UAS and UAS critical component, regardless of the company’s country of origin. If it was made outside the United States and it communicates, flies, or powers a drone, it is almost certainly on the list. This impacts domestic UAS manufacturers materially because, today, most UAS components are not made in the United States.
Q2: What Does It Actually Mean to Be on the Covered List?
To understand why landing on the Covered List is such a serious problem, you first have to understand what an equipment authorization actually is and why every drone manufacturer needs one.
The FCC requires an equipment authorization for virtually any device that transmits or receives RF signals before that device can be imported into the United States, offered for sale or marketed in any way. This is not optional. Without it, a UAS or UAS component cannot legally enter the U.S. commercial market at all. This single requirement is the gateway to the entire U.S. drone market.
When a product lands on the Covered List, that gateway slams shut for anything new. A company cannot submit a fresh application for a new equipment authorization for that product. If you are launching a new drone model or introducing an updated component, you cannot get the federal approval you need to sell it in the United States. That is a market death sentence for new products.
The Supplier’s Declaration of Conformity (SDoC) process, a self-certification route that allows companies to test their own equipment against FCC standards and declare compliance without going through a third-party testing laboratory or a full FCC review, is also off the table. That matters enormously to smaller manufacturers and integrators. The SDoC is faster, cheaper, and far less burdensome than the formal certification process. Covered List equipment no longer has access to that pathway.
Many existing operators will feel the most immediate pain with the modification restriction. If you already hold an equipment authorization for a UAS or UAS component, you might assume you can continue to refine and improve that product as you normally would. Under the new rules, you cannot, at least not without meeting one of the two exemptions or obtaining a conditional approval, as discussed in more detail below.
A “modification,” is “anything that changes the equipment as authorized by the FCC.” That covers, among other things, changes to design, circuitry, construction, software or anything affecting the device’s RF emissions, power output or operational capabilities. In the drone world, where firmware updates are routine and hardware iterations happen constantly, that restriction is extraordinarily broad. Updating a flight controller’s software, tweaking a motor’s power management system or changing a component’s communication protocol all potentially trigger this restriction.
The one narrow exception that the FCC carved out are certain Class I permissive changes, which the agency waived back in January 2026. Permissive changes are a tiered system the FCC uses to classify product modifications. Class I changes are the most minor and typically require no FCC re-filing at all, while Class II and Class III changes require increasingly formal review. By waiving Class I changes, the FCC gave manufacturers a small degree of operational flexibility in the ability to make truly inconsequential tweaks without penalty. But Class II and Class III modifications, the kinds that actually advance a product or keep it competitive, remain blocked for covered-list equipment unless the manufacturer has first secured an exemption or conditional approval.
Taken together, these three restrictions mean that a company with a product on the Covered List is effectively frozen in place. It cannot bring new products to market, cannot self-certify through the faster SDoC route and cannot meaningfully evolve the products it already has. For a technology sector where innovation cycles are measured in months, that is an enormous competitive and commercial handicap. And the clock on available pathways to get off the list is already running.
Q3: Do I Need an Equipment Authorization for the Whole UAS or Just the Radio?
For years, the working assumption was that if one gets FCC approval for the communications link, the rest of the aircraft takes care of itself. That assumption no longer holds.
As of December 22, 2025, the following components are on the Covered List:
- data transmission devices
- communication systems
- flight controllers
- ground control stations and UAS controllers
- navigation systems
- sensors and cameras
- batteries and battery management systems and
- motors
What does this mean? Now, most of the components of your UAS are likely on the covered list. You will need to meet one of the two exemptions or receive a conditional approval for all components to exempt the entire UAS from the Covered List. Once you have met one of the two exemptions or received a conditional approval for the entire UAS, you may proceed with the normal equipment authorization procedures because your device is no longer covered equipment.It’s really hard to think of a circumstance where that would not be required.
That leads directly to a second, often overlooked point. The attorney handling your FAA certifications probably cannot handle this. FCC processes are their own discipline. Lawyers working on FAA certifications are usually not experts in FCC processes. Operators need dedicated FCC counsel before they even approach the equipment authorization application stage.
Q4: Can I Still Use My Modular Approval or SDoC?
The modular approval mechanism, which was created by the FCC to let manufacturers reuse an approved transmitter across multiple devices without recertification, has effectively been shut down for foreign-produced UAS or UAS critical components on the Covered List.
Closing the loophole on modular transmitters is not as impactful as the fact that nearly all UAS critical components are now on the Covered List. Virtually every new or reconfigured UAS and UAS component requires new FCC equipment authorizations because of the vast additions to the Covered List.
As mentioned, the SDoC route has been similarly foreclosed. Unless an operator satisfies one of the two exemptions or holds a conditional approval, the SDoC process for UAS and UAS critical components is no longer available. The loopholes have been shut down.
Q5: Are Existing Equipment Authorizations at Risk?
This is where the news gets even more complicated, if that’s possible. Right now, equipment authorizations granted before December 22, 2025 are grandfathered. Manufacturers can continue to import, market and sell that equipment as normal, with one big caveat. They cannot modify the equipment or invoke permissive change procedures.
What the industry should watch, however, is what happens next. It is possible that UAS that already have equipment authorizations will be banned from being imported and marketed in the United States. The FCC established procedures whereby it can publish a public notice listing specific equipment that can no longer enter the U.S. market. Foreign-produced UAS could appear on that list.
We’re hearing from the FCC and the White House that they’re really trying to consider the timing of that and the impact on industry, but it is very likely that it will happen. Operators with current authorizations should not assume they are permanently protected.
Q6: When Do I Need to Go Back to the FCC for a New Authorization?
The answer: it is easier to ask when you do not need to go back. We struggle to come up with a convincing scenario. Any new UAS or new UAS critical component requires fresh authorization. Any modification that changes, for example, design, circuitry, construction, software or anything affecting RF emissions, power or operational capabilities also triggers a new authorization requirement.
For manufacturers or integrators, on the FAA-versus-FCC sequencing question, first establish your FCC pathway by meeting an exemption or securing a conditional approval, then apply for FAA and FCC authorizations simultaneously. The FAA is already holding off on reviewing authorizations for UAS that cannot demonstrate either an FCC exemption or a conditional approval. Getting both applications moving in parallel is the fastest route to a legal, marketable product.
Q7: Three Ways to Get Off the Covered List — What Are They?
There are exactly three routes off the Covered List, and most companies will need the third:
- Defense Contract Management Agency (DCMA) Blue UAS List, which covers drones and drone components that have undergone rigorous Department of War (DoW) vetting for cybersecurity and supply chain security. That process takes time but delivers broad clearance.
- Buy American Standard Exemption. You must demonstrate that 65% of the cost of the components in the UAS or UAS critical component (whichever is your end product) are U.S.-manufactured.
- Conditional Approval, where a manufacturer submits detailed information about its ownership structure, technology, its bill of materials, and its plan to onshore manufacturing over time.
The third is, by far, the most common path being pursued today. Of the four conditional approvals granted so far, three have covered full UAS systems rather than individual components, which signals exactly how broadly the DoW and Department of Homeland Security (DHS) views the compliance burden. Depending on your end product, UAS or UAS critical component, you should really be thinking about your whole UAS when you’re going into the DoWand DHS asking for any conditional approval.
Q8: How Do You Actually Calculate the 65% Buy American Threshold?
Buy American, as applied here, requires that 65% of the overall cost of the components in the end product, not just the UAS critical components, be manufactured in the United States. The calculation covers every piece of the UAS, regardless of whether it appears on the critical components list.
To determine if 65 percent of the overall cost of the components in the end product is made in America, the numerator is the total cost of components, and the denominator is the U.S. manufactured components.
The cost of components purchased by an entity includes:
- The acquisition cost;
- Any transportation costs to the place of incorporation into the end product; and
- Any applicable duty.
The cost of components manufactured by an entity, includes:
- All costs associated with the manufacture of the component;
- Any transportation costs to the place of incorporation into the end product; and
- Allocable overhead costs.
Excluded from the component cost definition are:
- The entity’s profit margin on manufactured components; and
- Any costs associated with the manufacture of the end product (the UAS in this case).
There is an important warning here. The exceptions, such as the WTO exception and the nonavailability exception that may normally soften Buy American requirements in federal procurement are not available for the FCC equipment authorization purposes. In practice, this means that it will be difficult for most companies to meet the Buy American Standard exemption because most UAS manufacturers max out around 20 to 30 percent. Motors, batteries, and remote controllers are essentially unavailable as U.S.-made components at commercial scale today. For nearly all manufacturers, Buy American is an aspirational standard, not a present-day compliance path
Q9: Can Foreign Companies Apply for Conditional Approval?
Yes, and some already have received it. What a foreign company’s conditional approval application must center on is a credible, detailed onshoring plan. It must include where parts currently come from, who the company’s U.S. partners are or will be and a concrete timeline for shifting manufacturing stateside, over time.
One category of companies is categorically excluded, though. Entities already named on the Covered List, including DJI and Autel, cannot use the conditional approval process at all.
For everyone else, the White House has dedicated additional staff and reportedly uses automation tools to try to process applications within roughly seven days of submission, though that timeline remains unverified.
The urgency is real, however. Conditional approvals granted to date are only valid through December 2026. This means recipients must get their FCC equipment authorization(s) processed before their conditional approval expires, or they may need to start the authorization application process anew.
Q10: What Happens When the Exemptions Sunset on January 1, 2027?
Both the DCMA Blue UAS List exemption and the Buy American Standard exemption are currently set to expire on January 1, 2027, unless the administration issues a new national security determination extending them. Equipment authorizations already granted under those exemptions will be grandfathered. Operators can continue to import, market and sell those products. But without extensions, no new authorizations can be sought through those paths, and modifications to grandfathered equipment will again require the conditional approval process.
In our discussions with the White House, they understand that they will likely need to extend these exemptions beyond January 1st of next year. The administration’s instinct seems to lean toward shorter-term extensions to keep industry moving on onshoring goals rather than a long, open-ended reprieve.
The conditional approval window is even tighter. Approvals issued to date expire in December 2026, not January 2027. This gives recipients less than a full year to complete the equipment authorization process. Miss that window, and the process could reset entirely. It is very important to be working rapidly on all of this.
The FCC has also released a public notice (DA 26-314) seeking stakeholder input on, among other things, facilitating additional access to spectrum and streamlining UAS and counter-UAS licensing procedures, with comments due May 1, 2026, and reply comments due May 18, 2026.
The bottom line for the industry: The FCC’s foreign UAS prohibition is not a temporary policy. It is the architecture of the new American drone industrial base, and is already operational. Manufacturers and integrators who are not actively mapping their components, applying for the DCMA Blue UAS List, calculating their Buy American percentages and preparing conditional approval applications are already behind.
About the Authors
Jennifer Richter is a partner at Akin and chairs the firm’s Telecom, Media and Technology practice, where she has represented technology and communications companies for more than three decades. She previously served as vice president and general counsel of a wireless communications company she helped build and sell to the Sprint Corporation, giving her direct industry experience that complements her regulatory practice. Ranked by Chambers USA as a leading telecommunications lawyer and recognized multiple times as a Washington, D.C. Super Lawyer for communications law, Richter has spent years advising clients on UAS strategy, development, and operations, including regularly counseling both the FAA and the FCC on communications solutions for unmanned aircraft. She can be reached at jrichter@akingump.com.
Halie Peacher is counsel in Akin’s Telecom, Media and Technology practice, where she advises a wide range of telecommunications and technology clients on regulatory licensing, rulemaking, compliance, and spectrum-related matters before the FCC. Halie also represents a number of clients on unmanned aircraft system (UAS) applications, strategies and compliance, and works with the FCC and the FAA to solve questions regarding acceptable communications solutions for UAS. Her practice spans wireless companies, media content and service providers, industry associations, and investors, with a specific focus on autonomous systems, advanced mobility, and space law and policy. Before joining Akin, Peacher served as an attorney advisor within the FCC’s Wireless Telecommunications Bureau, where she played a key role in advising agency leadership on spectrum licensing and policy matters — experience that gives her a firsthand understanding of how the Commission thinks and operates. She can be reached at hpeacher@akingump.com