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The Final Frontier: An Examination of Space Commerce Law - Chris Deng Vinsien

From the realm of science fiction to the cusp of reality, the commercialisation of outer space is no longer a distant dream but an imminent frontier. Once the exclusive domain of governmental entities, the exploration of outer space has evolved into a dynamic frontier of private enterprise and commercial opportunity. The early days of space exploration were characterised by international collaboration and a shared vision of outer space as a 'universal commonwealth' for the collective benefit of humanity. However, the landscape has dramatically shifted. The advent of commercial space companies like Arianespace, SpaceX, Blue Origin, and Virgin Galactic has revolutionised the industry, propelling us into an era where space tourism and space mining are no longer the stuff of science fiction. Yet, as we stand on the precipice of this new era, the existing international treaties governing space activities seem ill-equipped to navigate the complex regulatory challenges posed by the commercialisation of outer space. This essay delves into the commercial opportunities and legal issues arising from the privatisation of outer space, exploring the need for a comprehensive, globally coordinated regulatory framework to ensure the safe and sustainable development of space commerce.


Background


In its early stages, space exploration was marked by international collaboration and the perception of outer space as a 'universal commonwealth', intended for the collective advantage of all humanity. The period between 1967 and 1979 saw the United Nations (UN) fostering partnerships among nations, leading to the establishment of five pivotal treaties: (1) the 1967 Outer Space Treaty; (2) the 1968 Rescue Agreement; (3) the 1972 Liability Convention; (4) the 1976 Registration and (5) the 1979 Moon Agreement. These treaties, shaped by the Cold War rivalry between the United States and the Soviet Union, set forth broad principles for space ventures but lacked precise definitions of statutory terms crucial for the effective regulation of commercial activities in space.


The realm of space exploration, once dominated by governments, is now progressively shifting towards privatisation and commercialisation. In 1984, Arianespace, the pioneer in satellite launch services, propelled the first commercial satellite into orbit. Two decades later, in 2004, SpaceShipOne executed the first privately funded human spaceflight. By 2012, SpaceX had accomplished the first commercial resupply of the International Space Station. As we stand in 2023, SpaceX's reusable rockets have significantly cut the cost of space travel, the National Aeronautics and Space Agency (NASA) Artemis Program is aiming to establish permanent human settlements on the moon, and industry leaders such as Blue Origin and Virgin Galactic are spearheading the exploration of outer space’s commercial potential.


The advent of space privatisation ushers in an entirely new domain of commercial potential. In particular, two sectors are poised to gain significant momentum in the forthcoming decades: space tourism and space mining. However, the full potential of these commercial opportunities can only be harnessed if robust regulations are established to guide the safe development of space commerce and provide clear directives in the event of disputes. For space tourism, there must exist proper safety regulations for commercial spaceflights. For space mining, it must be established who ‘owns’ celestial bodies. Further, the problem of space debris and congestion of satellites in Earth’s orbit must be addressed as it may pose a significant safety risk to commercial activity in space.


Regulating Space Tourism


In recent years space tourism has become significantly more cost-effective. This has been primarily driven by the emergence of reusable rockets, pioneered by the innovative efforts of companies like SpaceX and Blue Origin. This development has not gone unnoticed by enterprising business magnates. In July 2021, billionaires Jeff Bezos (founder of Blue Origin) and Richard Branson (founder of Virgin Galactic) engaged in a highly publicised 'space race' to promote their respective enterprises. However, this competition revealed more than just the egos of two billionaires. The technological advancements made by these companies showcased the potential, and perhaps the commercial feasibility, of space tourism. As of 2021, a brief 15-minute journey into space on Virgin Galactic carried a price tag of $450,000. Despite this hefty cost, the existence of a 600-person waiting list indicates that the price is not a prohibitive factor.


However, there is still much to be done about safety regulations for outer space travel. Currently, safety regulations relating to space tourism do not exist. For example, in the United States, all flying vehicles fall under the authority of the Federal Aviation Administration (FAA), except vehicles in outer space. Due to a moratorium on federal regulation of space, the travel of individuals to outer space does not fall under any regulation. The rationale for the moratorium was to provide a ‘learning period’ for commercial spaceflight to develop. It was deemed premature to create regulations when the unique types of vehicles, systems and equipment were still in developmental stages.


However, with the moratorium set to expire on 1 October 2023, an opportunity to regulate space travel is on the horizon. Since the moratorium was created in 2004, commercial spaceflight companies have developed dramatically. Indeed, a report for Congress by the FAA in 2017 concluded that the spaceflight industry was not ready for regulation.


Since then, however, significant milestones have been achieved. In 2019, NASA collaborated with SpaceX multiple times, using the SpaceX Dragon to carry payloads to the International Space Station (ISS). In 2020, SpaceX successfully launched its first manned mission to the ISS. This mission, known as Demo-2, transported NASA astronauts Robert Behnken and Douglas Hurley to the ISS, demonstrating that commercial companies could safely and effectively carry humans into space. Although it is unclear whether these milestones justify lifting the moratorium, the belief of NASA in Space X, a private company, is a massive nod of confidence to commercial space companies.


Regulating Space Mining


In a recent publication, Norton Rose Fulbright highlighted that space mining is poised to become a significant area of interest in the commercial space industry in the forthcoming decades. The anticipated establishment of permanent bases on celestial bodies like the Moon and Mars has amplified the demand for mining valuable resources such as hydrogen and oxygen from lunar ice. These elements are crucial for the production of rocket fuel, a necessity for interplanetary exploration. Additionally, near-Earth asteroids are rich in metals like nickel-iron alloys and platinum, offering a potential solution to our reliance on Earth's finite supply of precious metals.


Recognising this potential, several nations have enacted laws to facilitate commercial space mining. For instance, Japan's Space Resources Act permits Japanese private business operators to engage in the exploration and development of space resources. Similarly, the US Commercial Space Launch Competitiveness Act of 2015 promotes the right of US citizens to engage in commercial exploration and recovery of space resources. Luxembourg's 2017 Law and the United Arab Emirates' Federal Law No 12 of 2019 also provide for private property rights over space resources.


The Artemis Accords, endorsed by 21 countries as of September 2022, aim to establish a framework of principles, guidelines, and best practices for the civil exploration and use of outer space. However, these domestic laws and the Artemis Accords have faced criticism from space-faring nations for their perceived inconsistency with existing international space treaties.


For example, Article II of the Outer Space Treaty provides that "[o]uter space, including the Moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means.” This principle seems to exclude any private property rights in outer space. Therefore, the Artemis Accords' endorsement of the extraction and use of outer space resources may be contrary to binding international treaties.


For the commercialisation of outer space to become a reality, nations must agree and clarify who ‘owns’ celestial bodies. If other states do not recognise a title to space resources based only on domestic law, disputes over space mining could arise between states. Failing to consult the global community on outer space property rights could potentially escalate geopolitical tensions. Indications of such tensions are already evident. For instance, major space-faring nations like Russia and China have not only refrained from signing the Artemis Accords but have also criticised the USA’s stance on private ownership of outer space.


Overcoming Congestion and Space Debris


Regulations are futile if it is physically unsafe to launch rockets. The absence of comprehensive regulations governing the deployment of satellites into Earth's orbit has precipitated a congestion crisis in international space. As of 2023, the total number of satellites launched into orbit stands at 15,430, with only around 7,700 remaining operational. Over the next ten years, companies such as SpaceX, Blue Origin, and OneWeb aim to launch tens of thousands of additional satellites in their pursuit of establishing mega-constellations - clusters of satellites designed to function in unison. On the other side of the globe, China has plans to set up a mega-constellation comprising 13,000 satellites. These impending launches threaten to intensify the already pressing issue of space congestion.

The anticipated surge in satellite numbers could have disastrous consequences if the issue of space debris remains unaddressed. At present, there are an estimated 36,500 pieces of space debris larger than 10 centimetres in orbit around Earth. This debris, moving at high velocities (up to 28,000 kilometres per hour), poses a risk of catastrophic accidents since even small pieces can cause significant damage if they collide with a satellite or spacecraft.


The 'Kessler effect', named after NASA scientist Donald J. Kessler, is a scenario in which the density of objects in low Earth orbit (LEO) is high enough that collisions between objects could cause a cascade. Each collision generates space debris that increases the likelihood of further collisions, leading to the potential of a runaway chain reaction. If this were to happen, it could make space activities and the use of satellites in LEO extremely difficult.


A collective effort must be made to create regulations to incentivise nations to work together and remove space debris. Although non-binding guidelines exist to curb the proliferation of space debris (such as the UN’s Space Debris Mitigations Guidelines) the practical aspects of debris removal have proven challenging. A significant obstacle is the absence of a universally accepted definition for 'space debris' in any binding international space treaty. Current treaties only refer to 'space objects', failing to differentiate between operational and non-operational objects. This issue is further complicated by the fact that space objects remain the property and responsibility of the launching state, thereby discouraging collaborative initiatives for debris removal between nations.


Conclusion


Addressing these challenges prompts us to ask: how can we effectively resolve them? The solution, while straightforward, carries a touch of irony. The irony lies in the fact that the very essence of commerce, characterized by intense competition, can only be enhanced if comprehensive regulations are implemented. It necessitates a global collaborative effort among nations to establish fresh regulations and amend existing treaties. It is inadequate for nations to independently formulate regulations without giving due consideration to pre-existing agreements that designate outer space as a 'global commons'. Currently, space-faring nations exhibit a hesitancy towards committing to new legally binding instruments. To foster uniform state practice, it is imperative to reassess the enforceability and implementation of the existing legal framework. Only when there are comprehensive regulations, agreed upon by nations around the world collectively, can space commerce truly lift off.

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