Legal Uncertainty Abounds as Space Race Heats Up

November 8, 2016Articles The Legal Intelligencer

Benjamin H. McCoy authored The Legal Intelligencer article, "Legal Uncertainty Abounds As Space Race Heats Up."

On Sept. 3, 2016, the Federal Aviation Administration authorized the first private space mission beyond the Earth's orbit. The authorization permits Moon Express, Inc., a private space entity, to conduct an unmanned mission to the moon in 2017 in order to mine its resources. Shortly thereafter, Elon Musk, founder of SpaceX, unveiled plans to begin ­colonizing Mars within 10 years, while President Obama opined that similar colonization efforts could realistically commence by 2030. Meanwhile, Amazon's Jeff Bezos and Google's Larry Page have joined ­numerous other investors in creating their own commercial space entities.

The rapid growth of the commercial space industry—which just 15 years ago revolved primarily around sending the rich and ­famous into space—can largely be traced to Nov. 25, 2015, when President Obama signed into law the U.S. Commercial Space Launch Competitiveness Act. The act is intended to clear many of the legal roadblocks standing in the way of space innovation. By way of example, the act allows companies to experiment for a learning period of eight years before the FAA and other agencies will install industry standards. In addition, experimental, multi-use flight permits are available for purposes of testing reusable rockets. As a further incentive, the act ­includes "launch liability indemnification," which requires the government to partially indemnify private space entities for any third-party damages caused by their space activities.

Most notably, the act grants ownership rights over any resources (resource rights) that are extracted from "celestial bodies" (i.e., asteroids, the moon, other planets). This provision has garnered particular ­attention because it represents the first time that ownership rights have been recognized in space. Given the unfathomable potential for wealth lying within near-Earth celestial bodies, a present-day gold rush has quickly unfurled.

However, there is considerable debate about whether the act's resource rights will be recognized within the international space community. In particular, many ­question whether the act defies the Outer Space Treaty of 1967 (the treaty), which controls international space law. The bedrock of the treaty is that space is "the province of all mankind," meant to be shared by all but owned by none. Thus, the treaty specifically prohibits states—and any commercial ­entities subject to their laws—from exercising ownership or sovereign rights over celestial bodies.

Proponents of the act reason that the treaty is silent on whether one can ­invoke territorial rights over the ­removable resources present in celestial bodies, as opposed to the bodies themselves. Because the treaty only speaks to sovereign property rights over a celestial body, proponents reason, there is nothing to thwart a claim over the resources residing therein. This distinction finds some ­support in traditional land ownership principles, see Hetrick v. Apollo Gas Company, 608 A.2d 1074, 1077 (Pa. Super. 1992) (recognizing three separate estates of land, the surface, the right of support and the rights to minerals).

But it's not that simple. Depending on the country, mineral rights are originally owned by either the landowner (common law ­countries) or the state itself (civil law countries), see "International and Comparative Mineral Law and Policy: Trends and Prospects" (The Hague: Kluwer Law International, 2005). And as most of us recall from first year property class, legal precepts such as the "discovery doctrine" and the concept of natural law require at least some degree of sovereign control over the property to create rights to the attendant resources. Current territorial disputes over the Arctic seabed and the South China Sea further buttress the point that ­sovereign rights go hand-in-hand with ­resource rights.

In the end, it remains unclear whether the treaty's ban on space ownership ­includes a ban on resource rights. For now, the issue is purely hypothetical. But expect it to quickly rise to the forefront as the ­necessary ­technological advancements occur. Going forward, a more comprehensive international agreement will undoubtedly be needed. For potential guidance, we can look to other international agreements governing unclaimed territory, such as the UN's Convention on the Law of the Sea and the Antarctic Treaty. On the domestic front, expect the United States to enact additional laws for increased oversight of private deep-space missions.

In the meantime, the race is on.

Reprinted with permission from the November 8 issue of The Legal Intelligencer. (c) 2016 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.