D (9:43)

Thanks, Maria. We've included three additional links in the selected reading section of the show. Notes they cover the latest job cuts at Marshall Space Flight Center. New investment for Australia's hypersonic launch systems and Teledyne's acquisition of transponder tech from Saab.

A (9:58)

Thank you for that, Alice. And a reminder that all of those links are also available on the episode page of our website. Space.n2k.com Friends, our whole mission here at T Minus is to give you a daily intel briefing about what's happening in the space industry that's impactful to you. So your feedback is really important to us, especially when you leave us a rating and a review like this one by K and Small on Apple Podcasts. And they wrote this I listen to the first half of this podcast every weeknight. I am not in the space industry and know little about it, but I find the news updates fascinating. I feel like I'm learning and I had no idea of the rich news about space. There is. Sometimes I listen to the second half of the show, but not always. A lot of that is a little in the weeds for me now. Thank you Can Small for listening and for your honest feedback. I'm honestly really thrilled that you're learning about the space industry through us. And I totally understand that certainly not every interview is going to resonate with everybody. And that is a okay too. And you too friends can let us know how we are doing with your rating and review in your podcast app of choice and maybe I'll even read.

C (11:12)

It on the show.

A (11:14)

And speaking for the entire T Minus team, a huge, huge thank you in advance for taking a moment to tell us what you think.

E (11:42)

What happens when cybercrime becomes as easy as shopping online? Spy Cloud's Trevor Hilligoss joined Dave Buettner on the Cyberwire Daily to explain how a wave of cybercrime enablement services are lowering the barrier to entry and making sophisticated attacks available to anyone.

F (12:02)

I think it's a pretty good general term that describes kind of an umbrella of tools and services that I would kind of tag as criminal or criminal adjacent. Instead of having, you know, sort of the smaller pool of high sophistication actors that are able to kind of carry out these really vast and costly cyber attacks. You know, we see that being given to much lower sophistication, lower tech folks that are, you know, a much lower barrier to entry. To get into this field, the person that's buying access to this, they basically need a phone and a bitcoin wallet.

E (12:42)

Make sure you hear this full conversation and learn how the underground economy is reshaping Cyber risk. Visit explore.thecyberwire.com spycloud that's explore.thecyberwire.Com spycloud.

A (13:11)

I'll hand you over now to Bailey Reichelt and Matthew Linton for space law FAQs.

C (13:19)

Welcome back, everyone. We're going to be talking about some space law FAQs again this week. I'm Bailey Reichelt and I'm here with Matt Linton.

G (13:27)

Hi Bailey. It's great to see you and hear you. So today we've got a really interesting and what appears to be eye glazing at first concept called the BIS 50% rule, or what was also called the affiliates rule. Bailey, tell us, what exactly is the BIS 50% rule or affiliates rule?

C (13:54)

Yeah, so a lot of people are calling it the 50% rule because if you've been in the industry for any length of time, you've dealt with the due diligence and all the bad guy screening lists. I just call them the bad guy screening list. They're not all bad guys. But you know, oversimplifying this concept here a little, there's all these lists of parties that the government doesn't want you to do business with or they want to limit the type of business you do. And depending on which list is how they want to limit your business. But it got called the 50% rule because the Office of Foreign Asset Control, which is part of the Department of Treasury, has a 50% rule for sanctions. So you've been hearing about sanctions for a while now and you have already had to do screening for sanctioned parties. Make sure you don't accidentally, accidentally do business with them because you could get in a lot of trouble with OFAC for that. And really, the banks took a lot of lead on this. The financial sector, they do heightened KYC and they look for sanctioned parties and that sanctioned 50% ownership. So it's if you have a sanctioned party and they have 50% ownership of an entity, then you're restricted in certain ways from doing business. And the financial sector's done a pretty good job of screening them out. And what I've seen in reality is that the industry has still had to do screening. You're still required to do screening. But a lot of these actors were getting screened out before they even hit industry. So your likelihood of seeing them was lower than, say, the entity list. So what is the entity list? Well, the entity list is a list that the Bureau of Industry and Security. So if you're dealing with the Export Administration regulations, you're very familiar with biscuits. But it's a list of parties that BIS has put together that pose some sort of risk or they're involved in Activities that are contrary to national security or foreign policy interests of the US you get added to the list because the US Government decides you are involved in those activities. You can also get off the list. There's a whole process for that. But historically in your due diligence, you are supposed to make sure that whomever you're doing business with, or it doesn't even have to be a customer, by the way, it could be anyone that you're signing a contract with. Right. That they weren't one of the parties named on that list. On that list, if you wanted to go find it, it's supplement number four to, let's see, part 744 in title 15. And on that list you're going to find a whole bunch of different countries. Well, actually a few different countries. You're going to find a lot of entities listed in China. I actually pulled one example up just so I could talk to you about how this rule works. You know, I'll wait and I'll give that example in a second. But anyway, this list use long standing. You can't do business with parties on here or you can request a license and there's a presumption of denial. So very unlikely to get that license for things that are subject to the earth. Okay, I'm sorry, that was a long explanation. Do you have any questions?

G (17:01)

No, that, that is it.

C (17:03)

It.

G (17:03)

And, and it really gets to. Again, why I indicated this can be a little funky at first. So let's, let's help us break it down. How would you work with a client who's, you know, exporting something and is becomes concerned about whether this rule applies and you know, give us some practical thoughts on, on, on what that client should do. And obviously they should, you know, talk to somebody like you who knows what they're doing probably at some point. But also how do they get, get this framed for themselves to, to, to look into the matter?

C (17:39)

Yeah, so under the new affiliates rule, which came into effect September 30, 2025, and it's interim final rule, by the way, so you can still submit comments. I think comments are still open before they publish the final rule. What they did is they expanded the entity list scope to entities that are not specifically named on the list, but who have common ownership. So now your screening process has to adapt to that. Before you could use the consolidated screening list, which is a free tool that a lot of exporters used, that's hosted by the government, the U.S. government. You could go there and you could screen parties to see if they were listed on the entity list. But now with the expansion of the rule, you also have to ask a party not only like screening them for if they're listed, but if they have any common ownership with a party that's listed on the entity list. And while it's focused on ownership, we also have a few sentences that say, you know, control can still count too. And if anyone's familiar with cfius and Committee on Foreign Investment in the US it's kind of similar in that control can have a subjective definition, but generally we're seeing if like someone has a board seat, if you have an entity list owner who's also got a board seat, that that could also trigger this new affiliates rule. And okay, so what impractical application does it mean if you figure out that someone has some shared ownership? Well, you have to figure out that percentage to know if it's 50% or if it's a substantial amount of control. That's hard. And the consolidated screening list won't get you there. The government said pretty clearly, like BIS said when they posted this interim final rule, you've already been doing this for ofac. You have already been using these private screening tools to tell you ownership in order to comply with sanctions rules. So it's not that big of a lift for you to do it here for BIS and for export controls on the entity list. So theoretically, and I can see from the government side that makes sense. But from the company side, banks have really handled sanctions quite a bit and filtered those entities out. But now all your exporters that we're screening against the entity list, they also need to invest in some sort of private sector tool now to be able to know ownership. And wait, you're probably going to have to ask, like, what happens if they can't figure out the ownership? What if they don't want to invest in those tools? Right, right. Well, it's considered a red flag if you think there might be some ownership and then you don't actually do the due diligence to figure it out. And if you have a red flag, then you're supposed to apply for a license.

G (20:34)

Interesting. So does this change in your mind how companies should be evaluating their investors in a new investment round as well? I mean, they're already worried about cfius, as you mentioned, if they've got security clearances, they're worried about foreign control issues. They all kind of interrelate here. But it seems and wondering if you agree that looking at this rule should be a part of anybody's sort of pre Deal diligence with their investors. Is that, is that a accurate way to look at it, do you think?

C (21:08)

Yeah. So you bring up a really good point and I think one that gets glossed over a lot. So sanctions deals with currency in the flow of money. Right. Which is, is broader than what the is controlling here with the entity list, which is exports of things that are subject to the ear. However, in the US we have this concept called a deemed export. So if you're giving an investor access to ear controlled technology that's still subject to the ear and can still trigger this affiliates rule. So should you be screening broader than your customers, even into investors against, against this list and beyond and going up the ownership chains? Absolutely. There could still be an implication here, especially if there's going to be an export of any technology subject to the earth.

G (21:57)

Okay. And so in your mind, sort of that first step that clients should take should be determining what potential private solution they may need, it sounds like to be able to do some of these screenings more effectively and then sort of implementing it throughout their, their, their process, whether it's for the export, whether it's for investment. Is that the right way to look at this? That is this sort of ongoing need that you will need to be mindful of?

C (22:26)

Yeah, absolutely. I mean the US Government's been expanding the scope of the due diligence they expect US companies to perform for a long time. And they say this even in their publication of this rule, that it's just untenable for BIS to continue to update the entity list every time an entity figures out it's on the entity list and then changes its information, reorganizes and resurfaces. Right. The US Government's having to track all of that and then change the entity or add entities to the list. So they're essentially saying they're pushing more burden onto the exporter. You should be doing these screenings already. The screening, let's see, the burden is getting higher. Comprehensive due diligence is heightening. You are expected to do more and be aware of more. There's less sticking your head in the sand. However, if you can't afford fancy solutions that are private sector or like, you know, solutions like buying descartes or something like that, you can just get a license. That's an option too. However, if you're getting a license because you suspect an entity list is involved, then there's a specific way you're supposed to fill out that license which they detail in the interim final rules. So you have to know why you're getting the license, but that is always an option if you're not going to make the investment in these heightened screening tools.

A (23:59)

And a quick follow up note. Dear listeners, this comes from Bailey Reichelt. Note that the BIS affiliates rule discussed in the Space Law FAQ segment has undergone changes in enforcement status due to geopolitical discussions since this episode was recorded. While not being actively enforced for one year according to the Trump administration, it is still a law and enforcement can resume at any point. For more information on the President's statement announcing a one year hold on enforcement, please check out the article attached to our show notes titled the US is suspending bis 50% rule for a year, Besant says after China trade talks. We will be right back. Welcome back. Pea Protein so hot right now whey has had its day. For all those looking to bulk up, protein powder made from peas has been the very popular choice in recent years. Indeed, peas are having quite a moment and a cousin to the yellow split pea, which is what pea protein is usually made from. The dwarf pea just had a two week experimental excursion in the University of Arizona's Biosphere 2. The famous space Analog experiment to end all famous space analog experiments. Now recently, researcher Matthias Beech was sealed inside Biosphere 2 for two weeks with nothing but 144 dwarf pea plants as his companions. This was not a psychology test though. This experiment was all about air quality and the question could those 144 dwarf pea plants sufficiently and reliably manage the air quality that beach breathed? And extrapolating from there, could we use plants in this way for long term off Earth missions, say on the Moon or on Mars or beyond? Now friends, I do not have answers for you just yet, as the experiment quite literally just ended on October 27, so analysis of all the data is still ongoing. But in the first week, Beech's exhaled carbon dioxide was taken in by the hydroponically grown pea plants and converted via photosynthesis into oxygen and carbohydrates, AKA peas. Yes, remember learning about photosynthesis in grade school? All of that. So that first week Beech was inhaling fresh air thanks to his pea friends. And on the eighth day of the experiment, Beech harvested those plants and sent them out an airlock to be studied and then stayed a second week without any plant friends. So it will be interesting to see the contrast in air quality between those two weeks when the results come out. Now, thanks to this study, we will also have a better understanding of how much carbon dioxide each dwarf pea plant can sequester. So we can one day. Extrapolate from there. How many plants would need to come along on a long duration mission to sustain human life. And that would indeed be some serious P power. And that's T minus Brought to you by N2K CyberWire we'd love to know what you think of this podcast. Your feedback ensures we deliver the insights that keep you a step ahead in the rapidly changing space industry. If you like the show, please share a rating and review in your podcast app. Please also fill out the survey in the show notes or send an email to space2k.com we are proud that N2K Cyberwire is part of the daily routine of the most influential leaders and operators in the public and private sector. From the Fortune 500 to many of the world's preeminent intelligence and law enforcement agencies, N2K helps space and cybersecurity professionals grow, learn and stay informed. As the nexus for discovery and connection, we bring you the people, the technology and the ideas shaping the future of secure innovation. Learn how@n2k.com N2K's senior producer is Alice Carruth. Our producer is Liz Stokes. We are mixed by Elliot Peltzman and Trey Hester with original music by Elliot Peltzman. Our executive producer is Jennifer for Ibin. Peter Kilpe is our publisher and I am your host, Maria Varmazes. Thank you for listening. We'll see you tomorrow.

E (28:37)

T minus.