The Federal Communications Commission in the USA suspect that Chinese drone maker DJI is trying to game the system by smuggling banned drones and drone components disguising these under different brand names and selling them through proxy companies.

The FCC has responded by widening its net for drones and related accessories on its 2025 covered to include the nine companies it suspects of operating as DJI mules.

A widely quoted example is the new pocket camera that a company called Xtra promoted as  “a compact camera as a jump “from Pocket to Pro”. Analysts say this line suspiciously echoes a well-known DJI product, which the new camera happens to physically resemble.

That kind of near-mirror styling, and the shared spec sheets behind it, is what allegedly drew the authorities’ attention.

To summarise, the story started in December 2025, when the FCC added all new foreign-made drones and components to its Covered List, which bars products from being imported or sold in the United States over national security concerns.

DJI was the most prominent name caught by the move.

All caught up? Okay; so, at the time, the rule applied only to new models. But now, the FCC’s new proposal goes further to target “certain previously authorised equipment” that the agency believes is being imported under re-shelled versions of older DJI products.

In October 2025, the commission voted to give itself the authority to strip approval from grandfathered devices tied to companies on the list: this proposal could be the first real use of that power.

And the escalation has gone from zero one hundred in no time at all. A week before the ban proposal, the agency had already floated $25,000 fines against eight of the firms for failing to answer letters asking whether they market equipment linked to the Covered List.

That penalty was for stonewalling investigators, separate from any finding about the drones themselves. And the affected companies comprise Cogito, Fikaxo, Lyno Dynamics, Skyhigh Tech, Spatial Hover, SZ Knowact Robot Technology, WaveGo, Xtra Technology and XAG.

We have to say it is such a surprise seeing XAG on this heavyweight list, seeing as the company has been making its own agricultural drones since way before the trade war between Beijing and Washington started.

The core of the suspicion stems from an independent industry investigation by one researcher Konrad Iturbe, whose detection methodology, detailed in his October 25, 2025 research paper “To Catch A Vibe,” allegedly demonstrates how DJI’s proprietary OcuSync transmission system uses specific radio frequencies that act as an unmistakable signature, revealing manufacturer identity regardless of corporate branding or Malaysian manufacturing locations..

So using this method, Iturbe allegedly uncovered that XAG used SGS-CSTC Shenzhen — the same Chinese laboratory and testing institution utilized by DJI — to process its FCC wireless and radiofrequency certifications. This prompted the FCC expanded its probe to XAG because this laboratory is allegedly structured in a way that places it under the direct control or influence of the Chinese government under U.S. wireless equipment rules.

XAG agricultural heavy-lifters (such as the XAG P100 Pro and the recently launched XAG P150 Max) rely heavily on complex, long-range transmission systems, RTK positioning modules, and specialised camera tracking sensors. Because DJI heavily dominates the supply chain for these specific uncrewed aircraft system (UAS) critical components, the FCC suspects XAG of white-labelling or integrating restricted DJI critical parts to bypass the foreign drone supply chain ban enacted on the FCC Covered List.

However – while eight other targeted companies (like Xtra Technology) entirely ignored the FCC’s formal Letters of Inquiry – XAG was the only company that did respond to the Enforcement Bureau. Apparently, it did not help them, as the FCC felt XAG’s explanations failed to ease national security concerns.

Consequently, on July 16, 2026, the FCC took the aggressive step of deferring and freezing XAG's grantee codes, blocking them from getting any new equipment authorised in the U.S. while the broader import ban proposal is reviewed.

Meanwhile, DJI has pushed back hard on the wider campaign against it, maintaining that concerns about its “data security have not been grounded in evidence and instead reflect protectionism, contrary to the principles of an open market.”

The new proposal fits a longer pattern, including the December decision to block new Chinese-made drones and the earlier deadline that first put the company’s U.S. future in doubt. DJI also lost a court fight over its place on a Pentagon blacklist, part of years of tightening rules on Chinese drone makers.

The proposal is also part of a broader effort to keep Chinese-made technology out of sensitive systems, following earlier limits on telecom and video-surveillance gear. In its notices, the agency has pointed to mass-gathering events, including the FIFA 2026 World Cup, as a reason to act early.

Officials argue that drones can be used for surveillance or disruption, and that a resilient domestic supply chain reduces the risk.

America drone technology laws consultant Jonathan Rupprecht has done a great job of putting on this into perspective in the below article.

On July 17, 2026, the FCC’s Public Safety and Homeland Security Bureau (PSHSB) and Office of Engineering and Technology (OET) released Public Notice DA 26-742, proposing to prohibit the continued importation and marketing of previously authorized drones, drone components, and video surveillance equipment produced by nine companies — including agricultural drone maker XAG.

The proceeding is PS Docket No. 26-184, and comments are due 30 days after the notice is published in the Federal Register.

Before you panic: this is a proposal, not a final rule, and even if adopted it would NOT make it illegal to fly equipment you already own. Here is what the proposal actually does, who it affects, and what you should do about it.

The Bottom Line for Drone Pilots

If adopted as proposed, the FCC would place a limitation on the existing equipment authorizations of the specific devices listed below, prohibiting their continued importation and marketing in the United States — which the FCC defines to include advertising, distribution, and sale.

The FCC is explicit that the prohibition “would not affect continued use or operation of already-purchased covered equipment.” In plain English: dealers couldn’t import or sell these drones anymore, but if one is already in your hangar, you can keep flying it.

The legal mechanism here matters. The FCC is not revoking anyone’s equipment authorization under 47 CFR § 2.939(a). Instead, it is using the newer § 2.939(e) procedure — created in the Commission’s October 2025 equipment authorization security order — that lets PSHSB and OET “place limitations on an existing authorization for covered equipment” to stop import and marketing without touching the underlying authorization. That is why continued operation stays legal.

Which Drones and Equipment Are Affected?

The proposal targets equipment produced by nine companies (and their affiliates, subsidiaries, and partners).  The specific FCC IDs named in the Public Notice:

What Is NOT Affected

The proposal is narrower than the headlines will suggest. It would not apply to:

• Equipment you already own. Continued use and operation of already-purchased equipment remains authorized.
• Blue UAS Cleared List drones. UAS and components on the Defense Contract Management Agency’s Blue UAS Cleared List are exempt from the Covered List until January 1, 2027.
• Domestic end products. UAS that qualify as “domestic end products” under the Buy American standard, 48 CFR § 25.101(a), are exempt until January 1, 2027.
• Conditionally approved equipment. UAS granted a Conditional Approval by the Department of War or the Department of Homeland Security.
• Note that some drones DO have this conditional approval. If you are a drone company that needs a conditional approval, reach out as we have helped other manufacturers find the right help to obtain theses conditional approvals.
• Toy drones. “Toy Drones,” including those containing foreign-produced components, were exempted from the Covered List on June 15, 2026.
• Federal government use and R&D. Importation and marketing for federal government use or for commercial testing and product development remain permitted.

How We Got Here

This is the latest step in a chain of FCC supply-chain actions. In November 2022, the Commission barred new authorizations of Covered List equipment but left previously granted authorizations intact. In October 2025, the Commission’s second equipment authorization security order created the § 2.939(e) procedure for limiting existing authorizations. On December 22, 2025, PSHSB added all foreign-produced UAS and UAS critical components — plus the Section 1709 communications and video surveillance equipment — to the Covered List, based on a National Security Determination from an Executive Branch interagency body citing risks of “unauthorized surveillance, sensitive data exfiltration, supply chain vulnerabilities, and other potential threats to the homeland.”

A parallel proceeding launched on March 27, 2026 addressed equipment placed on the Covered List in 2024 or earlier; that import-and-marketing prohibition became effective July 16, 2026 — one day before this Public Notice was released. Today’s notice extends the same treatment to the December 2025 Covered List additions as listed in this public notice.

Key Dates and How to File Comments

Comments are due 30 days after publication in the Federal Register in PS Docket No. 26-184, filed through the FCC’s Electronic Comment Filing System. If adopted, the FCC proposes that all importation and marketing must cease within 30 days after Federal Register publication of the final decision.

The proceeding is “permit-but-disclose” under the FCC’s ex parte rules, so meetings with Commission staff must be summarized in the docket.

The FCC specifically asks commenters to address existing inventory already imported and held for sale, shipments en route to the U.S., and devices under executed distribution or sales agreements that have not yet entered the supply chain.

Questions Being Asked by the FCC

I’ll copy-paste here the actual requests:

We seek comment on our tentative conclusions that the above-referenced equipment is covered equipment.  We invite commenters to provide specific evidence in response to our tentative conclusions.  Below, we provide a brief analysis of the relevant factors that would justify limitation on the authorization of previously authorized “covered” equipment and tentatively conclude that prohibiting the continued importation and marketing of this previously authorized covered equipment serves the public interest.

National security impacts.  We start with national security concerns, because, as the Commission noted in the EA Security Second R&O, “[i]t is obvious and unarguable that no governmental interest is more compelling than the security of the Nation.”^[1]  In the EA Security Second R&O, the Commission stated that older models of covered equipment, which are still widely sold in the U.S., pose an unacceptable risk to national security when imported or marketed in the United States, “not only when such equipment is new to the market.”^[2]  The Commission agreed with commenters who pointed out that certain previously authorized devices that are now considered covered equipment “likely remain[] marketable in the United States” and “may present continuing national security threats.”^[3]

Subject to exceptions,^[4] an Executive Branch interagency body with appropriate national security expertise, including appropriate national security agencies, one of whom was the DoW,^[5] specifically determined that UAS and UAS critical components produced in foreign countries and communications and video surveillance equipment and services listed in section 1709 of the FY2025 NDAA “pose unacceptable risks to the national security of the United States or the safety and security of United States persons.”^[6]  This determination of “unacceptable risks” was based on an assessment of “threats from unauthorized surveillance, sensitive data exfiltration, supply chain vulnerabilities, and other potential threats to the homeland.”^[7]  We believe this determination included all already-authorized covered equipment described in this Public Notice, which are UAS and UAS critical components produced in foreign countries and/or communications and video surveillance equipment and services listed in section 1709 of the FY2025 NDAA.[8]  We tentatively accept this determination and “give [it] particular weight,” as the Commission directed.^[9]

Therefore, based on the EA Security Second R&O and the December 21, 2025, National Security Determination, we tentatively conclude that prohibiting the continued importation and marketing of previously authorized covered UAS and UAS critical components and communications and video surveillance equipment and services listed in section 1709 of the FY2025 NDAA as described above is necessary to protect national security by mitigating risks to the U.S. communications sector.

Economic and supply chain impacts.  We seek comment on the potential economic and supply chain impacts of prohibiting the continued importation and marketing of the above-referenced already-authorized covered equipment.  How would this proposed action affect the financial interests of consumers, providers, and manufacturers in the communications sector?  As the Commission noted in the EA Security Second R&O, it may consider “countervailing economic concerns when implementing the prohibitions for already-authorized devices.”^[10]  What are the economic or supply chain considerations that weigh in favor or against taking this proposed action?  We invite commenters to provide data that we should consider in our analysis

We tentatively conclude that our proposed action would not have substantial economic and supply chain impacts, especially given that the devices subject to our proposed limitation comprise a very small share of the market.  None of the companies whose equipment is identified in this Public Notice—Cogito; Fikaxo; Lyno Dynamics; Skyhigh Tech; Spatial Hover; SZ Knowact; WaveGo; XAG; or Xtra—appear in major industry market analyses or rankings.   Do commenters agree that economic and supply chain impacts are relatively minor?  Could other equipment fill any gaps created by this proposed prohibition?  Has the Conditional Approval process provided an adequate source for trusted equipment now or in the future?  Would this proposal be cost-effective for the public in terms of obtaining trusted equipment?  Would providers’ compliance costs decrease as they replace covered equipment with trusted equipment?  We strongly encourage commenters to supply data and other specific evidence of economic costs to this prohibition.

On the other hand, we seek comment on any economic benefits that might arise as a result of these prohibitions.  We note that after the initial update to the Covered List, billions of dollars have already been raised by domestic UAS producers, creating thousands of U.S. manufacturing jobs.   Additionally, billions more have been committed for domestic production of UAS and UAS critical components, which are expected to generate additional jobs.   These investments include capital from domestic investors as well as foreign investors supporting U.S. manufacturing.   We tentatively conclude that if the proposed prohibitions of the previously authorized covered equipment subject to this Public Notice generated economic harm by noticeably reducing supply, such prohibition would spur investments in domestic production that would generate a countervailing positive economic impact.  Do commenters agree?  We seek comment on the economic effects of the likely investment in U.S. production that this proposed prohibition would yield.

Public interest analysis.  We tentatively conclude that prohibiting the importation and marketing of previously authorized covered equipment subject to this Public Notice is consistent with the public interest, because it protects American communications networks from devices specifically determined by an Executive Branch interagency body to “pose an unacceptable risk to the national security of the United States or the security and safety of United States persons.”   We also tentatively conclude that there are no public interest factors that outweigh our tentative conclusion regarding the proposed ban on import and marketing of this previously authorized covered equipment.  We seek comment on this public interest analysis.  Do commenters agree that the national security benefits outweigh any negative economic or supply chain factors?  Are there any other public interest considerations that weigh in favor or against taking this proposed action?  We invite commenters to provide any information that would assist the Commission in its balancing of the need to address the national security risks posed by the continued importation and marketing of previously authorized covered equipment in communications networks with the impact of the proposed prohibitions on government partners, consumers, industry, and the public at large.

Implementation timeline.  We propose that all parties must cease all importation and marketing activities within 30 days after publication in the Federal Register.  We believe that this timeline is reasonable and strikes the appropriate balance between addressing the national security concerns and minimizing any potential adverse economic or supply chain impacts.  We seek comment on the proposed timeline and invite input from responsible parties and relevant manufacturers, importers, distributors, retailers, and other interested entities.  Specifically, we request that commenters address implementation considerations including the quantity of devices that have already been imported into the U.S. and are available for or being held for marketing or sale, new or recently updated device models that are en route to the U.S. or pending shipment, and devices that are subject to executed distribution, marketing, or sales agreements, but have not yet entered the supply chain.

Frequently Asked Questions

Can I still fly my XAG drone?

Yes. The proposal bans importation and marketing, not use. The FCC states the limitation “would not affect the continued use or operation” of already-purchased equipment. Your FAA authority to operate is a separate question and is not affected by this FCC proceeding.

Can a dealer sell off remaining inventory?

For now, yes — this is only a proposal. If adopted as proposed, all marketing (advertising, distribution, and sale) must cease within 30 days of Federal Register publication of the final decision, which appears to include existing inventory. Dealers holding stock should file comments with specific inventory data.

Is this a final rule?

No. This is a Public Notice seeking comment. But note what happened in the parallel proceeding for pre-2025 Covered List equipment: proposed March 27, 2026, adopted June 26, 2026, effective July 16, 2026 — a little under of a four-month turnaround, with the effective date accelerated to just 10 days after Federal Register publication to prevent a surge of last-minute imports.

My drone is on the Blue UAS list — am I affected?

No. Blue UAS Cleared List equipment is exempt from the Covered List until January 1, 2027. Watch that date: the exemption is not permanent, and what happens after January 1, 2027 will depend on further Department of War determinations.

Going Forward

If you are a manufacturer, seller, or operator needing help with navigating the FAA’s 44807 and remote identification process, FCC Conditional Approvals, or obtaining DCMA Blue Listing, contact us and we would be glad to help you or connect you with the experts to help navigate these issues.

Sources

• FCC Public Notice DA 26-742 (released July 17, 2026), PS Docket No. 26-184
• FCC Covered List
• 47 U.S.C. § 1601 (Secure and Trusted Communications Networks Act)
• 47 CFR § 2.939 (revocation and limitation of equipment authorizations)
• 47 CFR § 2.929 (U.S. agent for service of process)
• FY2025 NDAA (Servicemember Quality of Life Improvement and National Defense Authorization Act), Section 1709
• Blue UAS Cleared List (Defense Innovation Unit)
• 48 CFR § 25.101 (Buy American definitions)
• FCC Electronic Comment Filing System