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By Andrea Shalal and Emily Stephenson
WASHINGTON, Feb 17 (Reuters) - The U.S. government on Tuesday established a policy for exports of military and commercial drones, including armed ones, and plans to work with other countries to shape global standards for the use of the controversial weapons systems.
The State Department said it would allow exports of lethal U.S. military drones under strict conditions, including that sales must be made through government programs and that recipient nations must agree to certain "end-use assurances."
The policy comes after a two-year review amid growing demand from U.S. allies for the new breed of weapons that have played a critical role in U.S. military action in Afghanistan, Iraq and Yemen.
It could help U.S. companies boost sales of U.S. military and commercial drones in an increasingly competitive global market.
Privately-held General Atomics, Northrop Grumman Corp , Textron Inc and other drone makers have been urging Washington for years to loosen strict export curbs, which they say have caused them to lose orders to Israel and others in the growing market.
The shift came just days after U.S. aviation regulators proposed rules on Sunday that would lift some restrictions on drone use for commercial purposes, but would still limit activities such as inspections of pipelines.
The change also follows stern warnings by top U.S. officials about rapid advances in weapons technology by China, Russia and other potential foes, including unmanned systems.
The new policy will make it easier for America's closest allies to buy armed drones, but will maintain stringent controls on the sale of such weapons, U.S. officials said.
Until now, Britain was the only country allowed to buy armed U.S. drones, but France and Italy fly Reaper surveillance drones built by General Atomics.
A State Department official declined comment on an existing request by Italy to add weapons to the Reaper drones it already flies, or Turkey's request for sales of an armed drone, but said such requests would be reviewed in light of the new policy.
The official said the United States would carefully monitor the use of any unmanned aerial systems (UAS) approved for export, much as it does other weapons.
The policy maintains "a strong presumption of denial" of sales of the biggest drones, so-called Category I aircraft that have a range of at least 300 km and can carry a payload of at least 500 kg, but will allow such exports on "rare occasions."
The official said there was no formal list of countries that would be eligible for exports of armed drones, and said all requests would be evaluated on a case-by-case basis and in accordance with existing U.S. export laws.
"As with any other sale, all UAS sales will continue to be reviewed for human rights, regional power balance, and other implications," the official said.
Sales of armed drones could boost Lockheed Martin Corp , which builds Hellfire missiles that are used by Predator and Reaper drones, but could also help companies like L-3 Communications Holdings Inc and Raytheon Co, which build sensors and simulators for the unmanned systems.
"The new policy ensures appropriate participation for U.S. industry in the emerging commercial UAS market, which will contribute to the health of the U.S. industrial base, and thus to U.S. national security, which includes economic security," the State Department official said.
Under the policy, buyers of military drones will have to agree to strict conditions, including adherence to international law, and a ban on using the drones for unlawful surveillance or to crack down on their domestic populations. (Reporting by Emily Stephenson and Andrea Shalal; Editing by Peter Cooney, Eric Walsh and Christian Plumb)