diff --git a/docs/policy/development.md b/docs/policy/development.md
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-# Not yet implemented
\ No newline at end of file
+# Development Policy
+
+This document defines the day-to-day development workflow for `distributor`.
+Use it with `docs/policy/architecture.md` and `docs/policy/documentation.md`.
+
+## Repository Layout
+
+- `cmd/distributor`: executable entrypoint only.
+- `internal/app`: top-level use cases for `run`, `validate`, and `inspect`.
+- `internal/cli`: standard-library command parsing, flags, help text, and command wiring.
+- `internal/config`: YAML configuration structs, loading, defaults, and validation.
+- `internal/bundle`: source bundle discovery, manifest parsing, digest calculation, and validation.
+- `internal/state`: destination `.distributor.json` parsing, validation, and comparison.
+- `internal/storage`: backend interface, registry, logical path rules, typed errors, and shared storage helpers.
+- `internal/adapters/local`: local filesystem backend.
+- `internal/storage/fake`: in-memory backend for tests.
+- `internal/publish`: destination inspection, output planning, reconciliation, execution, and managed cleanup.
+- `internal/transform`: transform interface and registry.
+- `internal/transform/markdown`: Markdown-to-HTML sidecar transform.
+- `internal/notify`: notification interface and current no-op notifier.
+- `internal/testutil`: shared test fixtures. Production code must not import this package.
+- `docs`: current user, operator, policy, internal, and roadmap documentation.
+- `examples`: copyable example configs and source bundles.
+
+Do not create new top-level package families such as `pkg`, `internal/stage`,
+`internal/modules`, or service-specific adapter directories unless the
+architecture policy or a current roadmap explicitly calls for them.
+
+## Common Commands
+
+Run the full test suite:
+
+```bash
+go test ./...
+```
+
+Run targeted packages while developing:
+
+```bash
+go test ./internal/config
+go test ./internal/cli ./internal/app
+go test ./internal/publish ./internal/state
+go test ./internal/transform/markdown
+```
+
+Run the CLI against an example config:
+
+```bash
+go run ./cmd/distributor run --config examples/local-publish.yml --dry-run
+```
+
+Validate or inspect a local source bundle:
+
+```bash
+go run ./cmd/distributor validate examples/source-bundle
+go run ./cmd/distributor inspect examples/source-bundle
+```
+
+If Go cache permissions fail in a restricted environment, use workspace-safe
+temporary caches:
+
+```bash
+GOCACHE=/private/tmp/distributor-gocache GOMODCACHE=/private/tmp/distributor-gomodcache go test ./...
+```
+
+## Coding Conventions
+
+- Keep the application small, explicit, and dependency-light.
+- Prefer package-local helpers over broad abstractions until behavior is shared by multiple packages.
+- Keep CLI parsing in `internal/cli`; business decisions belong in `internal/app`, `internal/bundle`, `internal/publish`, `internal/state`, and related core packages.
+- Keep adapter packages thin. Backend-specific filesystem or service behavior belongs in adapters; bundle, state, transform, and publish policy belongs outside adapters.
+- Preserve public CLI behavior, config semantics, manifest schema, destination state schema, and local MVP behavior unless the current task explicitly changes them.
+- Use `storage.DisplayPath`, `storage.StateFileName`, `storage.StatePath`, and `storage.ManagedBundleTargets` instead of duplicating those conventions.
+- Use `bundle.ValidateManifest` for normalized source manifest semantics, including embedded source manifests in destination state.
+- Use `config.ValidatePublishTransformPolicy` for publish and transform policy combinations.
+- Do not import concrete transform implementations from `internal/publish`; app-level wiring owns transform registration.
+- Do not import `internal/testutil` from production code.
+
+## Dependency Policy
+
+The project currently depends on:
+
+- `gopkg.in/yaml.v3` for YAML configuration loading.
+- `github.com/yuin/goldmark` for Markdown rendering.
+
+Add external dependencies only when they materially improve correctness,
+security, interoperability, or implementation complexity. Avoid dependencies
+for small conveniences. Do not let dependency-specific types leak across
+internal package boundaries unless that dependency is the explicit package
+contract.
+
+## Configuration Changes
+
+When adding or changing configuration:
+
+1. Update `internal/config/config.go` structs and YAML tags.
+2. Add defaults in `internal/config/defaults.go` only for built-in defaults.
+3. Add validation in `internal/config/validate.go` with clear field context.
+4. Update config load and validation tests.
+5. Update `docs/config.md` in the same change if current user-visible config behavior changes.
+6. Update examples only with configs that are valid and executable for implemented behavior.
+
+Config validation may accept fields for backends that are not executable yet,
+but user-facing docs and examples must clearly state execution support. At the
+time of this policy, only the local backend is executable.
+
+## CLI Changes
+
+The CLI is hand-written with the Go standard library. Do not introduce a CLI
+framework without a documented reason.
+
+When adding or changing commands or flags:
+
+1. Keep parsing and help text in `internal/cli`.
+2. Keep command work in `internal/app` or a lower-level package.
+3. Add or update CLI tests in `internal/cli`.
+4. Update `docs/cli.md` if syntax, flags, output expectations, or workflows change.
+
+`validate` and `inspect` are local path commands. `run` loads configured
+pipelines and currently executes local backends only.
+
+## Storage Backends
+
+Storage behavior is defined by `internal/storage.Backend` and shared path rules
+in `internal/storage`.
+
+When adding a backend:
+
+1. Implement the storage interface in an adapter package.
+2. Translate backend-specific errors into storage errors where practical.
+3. Keep bundle comparison, transform, routing, and replacement policy out of the adapter.
+4. Register runtime construction through app-level backend factory wiring.
+5. Add focused adapter tests and app-level wiring tests.
+6. Update user docs, operations docs, examples, and internal docs only for behavior that is actually implemented.
+
+Do not document SSH/SFTP or S3 execution as available until corresponding
+adapter packages and app wiring exist.
+
+## Transforms
+
+Transforms use `internal/transform` interfaces and registry wiring.
+
+When adding or changing a transform:
+
+1. Keep the transform implementation in its own package under `internal/transform`.
+2. Register default runtime transforms from `internal/app`.
+3. Keep `internal/publish` dependent only on the transform interface or resolver.
+4. Record deterministic output metadata: path, source path, transform name, digest, and size.
+5. Add transform tests and app or publish tests for wiring and policy behavior.
+6. Update `docs/internal/transform.md` and any relevant integration docs for implemented behavior.
+
+## Tests
+
+Test close to the behavior being changed:
+
+- Use package tests for parsing, validation, comparison, planning, and adapter behavior.
+- Use `internal/app` and `internal/cli` tests for user-facing workflows.
+- Use `internal/testutil` for shared valid fixtures only; keep edge cases near the package under test.
+- Run `go test ./...` after cross-package changes or documentation/example changes tied to tests.
+
+## Examples
+
+Examples under `examples/` must be valid, maintained, and free of secrets.
+They should be copyable for implemented behavior. Do not leave examples that
+look runnable but require unsupported backend execution.
+
+When changing examples:
+
+1. Keep paths relative to the repository where practical.
+2. Prefer local examples until remote backends are implemented.
+3. Run `go test ./internal/config` because config tests load examples.
+4. Update README, CLI, or config docs if links or recommended workflows change.
+
+## Documentation
+
+Follow `docs/policy/documentation.md`.
+
+- Document implemented behavior outside `docs/roadmap/`.
+- Keep future, planned, or aspirational behavior under `docs/roadmap/`.
+- Keep `docs/config.md` canonical for user-facing config reference.
+- Keep `docs/cli.md` canonical for command syntax and workflows.
+- Keep `docs/operations.md` canonical for operational and recovery behavior.
+- Keep `docs/internal/` focused on implemented package contracts.
+- Update docs in the same change as behavior when public behavior, config, CLI, examples, or internal contracts change.