FCC Moves to Restrict Foreign-Made Drones While Clearing the Airspace for U.S. Innovation

The same week that the first tier of drone tariffs took effect, the Federal Communications Commission (FCC) published its final rule adopting several changes to its rules concerning drone authorizations, marketing of drones and modifications to drones that already hold authorizations, resulting in an October 13, 2026, effective date for the new rules. In addition, now that the comment period has closed on the FCC's proposal to retroactively remove "military grade" drones from store shelves, the FCC indicated it will continue to address what it views as potential national security concerns posed by drones. At the same time, the agency is taking action to broaden spectrum access for certain drone operations in the United States.

Updates to FCC Equipment Authorization Program and Marketing Standards

As Holland & Knight previously reported,¹ the FCC adopted sweeping changes to its equipment authorization framework in a Third Report and Order adopted on July 22, 2026. On September 11, 2026, the FCC published the new rules in the Federal Register, resulting in an October 13, 2026, effective date for the new rules.

Drone manufacturers, producers of radio frequency modular units made for drones, operators and retailers should take note of these regulatory changes in light of their novelty and breadth. The broad changes to equipment authorization eligibility could impact design, manufacturing, changes and model updates, and product support. Furthermore, for the first time, the FCC has clarified that online marketplaces are subject to marketing restrictions and should be subject to unique diligence requirements, given their interactions with consumers and role as a gateway to U.S. commerce.

Logic-Bearing Hardware

The rule prohibits equipment authorizations for logic-bearing hardware produced by entities identified on the Covered List (including subsidiaries and affiliates) and devices containing such components to the extent the device would be prohibited had it been produced by the relevant Covered List entity itself. The FCC defines a logic-bearing hardware component as "[a]ny device, system, module, sub-assembly, integrated circuit, or other physical component that generates and uses timing signals or pulses at a rate of more than 9,000 pulses (cycles) per second" that "uses digital techniques, including telephone equipment with certain characteristics."² The definition does not include purely mechanical or passive components such as housing, fasteners, resistors, wiring or plain battery cells.

The rule states that the agency considered but declined "at this time" to extend the prohibition beyond the entities listed on Covered List but interestingly left "the record open" on whether it might do so in the future.³ The definition will be codified at 47 C.F.R. § 2.902.

Online Marketplaces

FCC regulations have long prohibited the importation, marketing and use of radio frequency devices such as drones when such devices lack an equipment authorization (or are not qualified for an express FCC exemption from these requirements).⁴

FCC marketing rules already define marketing broadly: The long-standing definition includes "distribution for the purpose of selling." The new rule amends the general rule that applies to marketing, codified at 47 C.F.R. § 2.803, in a manner that ensures the FCC can reach any entity that markets unauthorized equipment, including e-commerce platforms. The rule states that retailers must provide an FCC identification number at the online point of sale whenever the retailer provides a list of regulated equipment on an online marketplace, in combination with any of the following: "consignment, warehousing, inventory management, order processing, labelling, packaging, billing, or fulfilment services – even if that equipment is sold or offered for sale by a third-party seller." This amendment to § 2.803 brings commonly known online marketplaces squarely into the agency's oversight.

As a result of the rule, online marketplaces will be subject to more requirements than physical stores, as they will now need to display a certified device's FCC identification number at the online point of sale. Online platforms selling drones and critical components should take measures to ensure their listings remain up to date, as the rule also confirms that online retailers are subject to enforcement of the marketing rules, regardless of whether the platform provider lacks awareness of products' compliance.

Modifications to Previously Authorized Equipment

The rule also addresses changes and modifications to equipment the FCC has previously authorized. The FCC has long allowed permissive changes that fulfill distinct criteria, known as Class I and Class II permissive changes.⁵ In the new rule, however, the agency clarifies that current FCC standards that address permissive changes and modifications apply both to equipment that is already prohibited from receiving authorization (such as Covered List equipment) and to equipment that would become prohibited as a result of a proposed modification.

As a result of the clarification, stakeholders should expect that any change in design, circuitry or construction of a certified device would render the device ineligible for equipment authorization if the change involves an entity identified on the Covered List. The FCC's Third Report and Order provides an illustrative example of such circumstances:

If a device was originally produced by Entity A, that device may not be subsequently redesigned and produced by Entity B if Entity B is a Covered List entity. If a UAS [uncrewed aircraft system] was certified at a time at which the UAS was produced in the United States, the device cannot later be modified by transferring production of the device to a foreign country, which would render the UAS "covered."⁶

The final rule expresses the FCC's adoption of this clarification: The prohibition on permissive changes and modifications set forth in § 2.932 and § 2.1043 applies not only to equipment that is already ineligible for authorization but also to equipment that would become prohibited as a result of a modification.⁷ Similarly, if a device is modified such that it would no longer be a domestic end product for purposes of the Buy American standard, the modification would prohibit the device from maintaining an equipment authorization.

Recertification for Any Change to Equipment

The new rule will also require that any entity identified on the Covered List that seeks to make a permissive change to equipment must submit an application for recertification rather than using the more efficient permissive change process, which involves a Supplier's Declaration of Conformity (SDoC). The FCC clarifies that this certification requirement applies only when the applicant for the modification is itself a Covered List entity. A manufacturer that is not on the Covered List that modifies equipment originally produced by a Covered List entity may continue to use the SDoC process as long as the modification does not itself render the device "produced by" the Covered List entity.

The recertification requirement in the rule indicates the FCC is fully aware that drones often undergo frequent updates and upgrades that entail modifications of equipment. In this regard, the agency also clarified that limited waivers that FCC's Office of Engineering and Technology (OET) previously granted to permit Class I and Class II permissive changes for Covered List UAS equipment and covered routers, through January 1, 2029, will remain in effect according to their terms.

Defining "Critical Infrastructure"

As a result of Section 889(f)(3) of the 2019 National Defense Authorization Act,⁸ the Covered List uses the term "critical infrastructure" in the list's references to equipment produced by certain, distinct companies. The final rule amends the definition to align it with a recent court opinion from the U.S. Court of Appeals for the D.C. Circuit, which found that the agency's interpretation of the definition was overly broad.⁹ In narrowing the definition, the final rule continues to rely on 16 critical infrastructure sectors within the purview of the U.S. Department of Homeland Security (DHS) and 55 National Critical Functions (NCFs) published by DHS' National Risk Management Center but narrows the scope of the definition by removing the broad term "connected to."¹⁰

Public Notice: Prohibition on "Military Grade" Drones

The FCC received more than 3,800 comments in response to its July 21, 2026, Public Notice seeking input on a proposal to prohibit the further importation and marketing of "certain foreign-produced military-grade uncrewed aircraft systems (UAS) and UAS critical components for non-U.S. Government, including those with swarming capabilities." The proposed move indicates that the FCC interprets its authority as broadly conveying discretion to enact restrictions on previously authorized "covered" equipment, consistent with the streamlined limitation of equipment authorization procedures it adopted in October 2025.¹¹

In the Notice, the FCC suggests that strong national security reasons counsel in favor of extending the current prohibition on foreign-made drones to include "drones viewed by the U.S. government as having military capability or posing particular national security risks," which the agency characterizes as:

• swarming drones
• drones specially designed to integrate defense articles
• thermal imaging drones
• drones integrating Light Detection and Ranging (LiDAR) sensing
• aerosol capable of dispensing "economic poison" under Federal Aviation Administration (FAA) rules
• drone docking stations
• UAS that weigh 55 pounds or more

The Notice clarifies that any prohibition it pursues would exclude UAS and UAS critical components not on the Covered List, either because they have been produced in the U.S. or are exempted, such as pursuant to the Blue UAS Cleared List, Buy America standard or receipt of a Conditional Approval.¹² In addition, the prohibitions would not apply to UAS and UAS critical components imported, marketed or sold for use by the federal government or for commercial testing and product development. Lastly, the prohibitions would not apply to use or operation of any already-purchased drones.

The comment period on the Public Notice concluded September 2, 2026. Almost all commenters expressed concern about the potential restrictions and their ability to limit the availability of commonly available drones. They explained that foreign-produced drones used for agricultural operations, for example, have operated for several years, pointing to the FAA's issuance of exemptions permitting operations involving aerosol dispensing of economic poison under 14 C.F.R. Part 137. The listing of drones the agency has determined can safely conduct agricultural operations in accordance with FAA regulations, which includes several foreign-produced drones, is lengthy.¹³ Moreover, drones using LiDAR that are produced outside the U.S. or that contain foreign-produced critical components are commonly available, according to commenters.

The FCC's sweeping proposal characterizing commonly available drones as "military grade" will remain a topic of discussion among industry stakeholders. Drone manufacturers, operators and retailers should remain apprised of the agency's potential adoption of the proposed restrictions.

Waiver for DOT Testing

Contemporaneously with the FCC's publication of the above Notices, the FCC's OET and Wireless Telecommunications Bureau issued a waiver on September 11, 2026, that would allow use of the U.S. Department of Transportation's (DOT) Mobile Network Aviation Assessment Program (MNAAP) to measure commercial wireless network signals on aircraft.

MNAAP was recently established by the DOT's Highly Automated Systems Safety Center of Excellence as a program for testing whether wireless networks can support aviation-based safety services such as "electronic conspicuity, remote identification, counter-UAS detection and identification, UAS command and control, and autonomous detection and avoidance applications."¹⁴ The temporary waiver, which will expire October 1, 2029, will enable MNAAP testing by "enabling mobile broadband providers and MNAAP participants to transmit radiofrequency signals to and from participating airborne mobile devices."¹⁵

The FCC's rules relating to UAS operations in spectrum bands vary – some bands have no restrictions, while others expressly prohibit aeronautical mobile use. However, pilots and drone operators generally cannot control which band a device uses, as wireless devices automatically select available frequencies based on network conditions. In order to facilitate MNAAP testing focused on mission-critical aviation safety applications, the FCC, on its own motion, issued this temporary waiver to ensure that potential transmissions in certain restricted spectrum bands will not violate the Commission's rules.

The availability of the waiver and the MNAAP testing it will enable is generally consistent with the FAA's beyond visual line of sight proposed rule, which will enable operations of drones weighing up to 1,320 pounds to operate beyond the operator's visual line of sight, as long as the drone has an accepted electronic conspicuity device, among other criteria.¹⁶ Moreover, the FCC's statements concerning its interest in enabling testing and development of counter-UAS technologies indicate the agency remains focused on ensuring U.S. companies are able to test such technologies, perhaps in furtherance of implementation measures for the SAFER SKIES Act, which permits state, local, Tribal and territorial governments to use technological solutions to intercept drones, subject to certain criteria, such as when using an approved solution. The FCC previously requested comments on actions it might take to enable testing of counter-UAS technologies under controlled conditions.¹⁷

With issuance of the waiver, the FCC noted it intends "[t]o unleash American drone dominance" and "spur a competitive connectivity marketplace for unmanned aircraft systems." The waiver might be an action in a series of steps the government will continue to take to ensure updated technologies can be tested and become available.

Conclusion and Key Takeaways

In the evolving environment of drone regulation, the federal government appears to remain committed to ensuring it does not curtail industry's efforts in ensuring solutions are available while restricting the availability of foreign-produced drones and critical components. Interested stakeholders should remain aware of the FCC's posture and consider seeking counsel on whether a particular restriction or waiver applies to proposed importation, marketing or operations.

Notes

¹ Holland & Knight alert, "Latest FCC, DOJ, DHS Actions on Drones Indicate an Increased Focus on National Security," July 21, 2026; Holland & Knight alert, "Tip of the Spear: Why the FCC Is Policing Strategic Technology," Aug. 11, 2026.

² Protecting Against National Security Threats to the Communications Supply Chain Through the Equipment Authorization Program, 91 Fed. Reg. 57798, 57799 (Sept. 11, 2026).

³ Id.

⁴ 47 C.F.R. §§ 2.803 and 2.805. Limited exceptions to these prohibitions exist, based on fulfillment of specific criteria. See also 47 C.F.R. § 15.103(a) (exempting from technical requirements devices utilized exclusively in any transportation vehicle).

⁵ 47 C.F.R. § 2.932 ("Modification to equipment") requires new application for an equipment authorization to be filed whenever there is a change in the design, circuitry or construction of an equipment or device for which an equipment authorization has been issued, unless as set forth in § 2.932. Any such change is not allowed, however, to equipment on the Covered List.

⁶ ET Docket No. 21-232, FCC 26-50 at 32 (July 23, 2026).

⁷ 47 C.F.R. § 2.1043(b)(1) ("A Class I permissive change includes those modifications in the equipment which do not degrade the characteristics reported by the manufacturer and accepted by the Commission when certification is granted.").

⁸ The FCC's final rule refers to the statute as the 2019 National Defense Authorization Act. The statute is available at John S. McCain National Defense Authorization Act for Fiscal Year 2019, Pub. L. 115-232 at § 889, 132 Stat 1636, 1917 (Aug. 13, 2018).

⁹ 97 F.4th 938, 950 (D.C. Cir. 2024) (concluding that the "FCC's definition of "critical infrastructure" as all systems and assets "connected to" sixteen economic sectors and fifty-five economic functions is overbroad, unexplained, and arbitrary").

¹⁰ See Critical Infrastructure Sectors, Cybersecurity and Infrastructure Security Agency (CISA).

¹¹ FCC-25-71 (Oct. 29, 2025).

¹² Prior Holland & Knight alerts explain these current exclusions from the prohibition. See, for example, FCC Exempts Certain Drones from Covered List, Jan. 13, 2026.

¹³ List of Approved Unmanned Aircraft Systems under Section 44807, Docket No. FAA-2023-1271 (last updated July 8, 2026).

¹⁴ In the Matter of Waiver of Aeronautical Mobile Restrictions to Ensure Mobile Network Aviation Assessment Program (MNAAP), DA-26-972 at 2 (Sept. 11, 2026).

¹⁵ Id. at 1.

¹⁶ Holland & Knight alert, "Drone Beyond Line of Sight Proposed Rule: Top 10 Things You Need to Know," Aug. 6, 2025.

¹⁷ FCC Seeks Comment on Unleashing American Drone Dominance, FCC Notice DA 26-314 (April 1, 2026).

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