Published on: 05th January 2025
Authored by: Keerthana N
Christ (deemed to be) University
Abstract
Privatisation of outer space through private enterprises is leading to a fundamental change in space law, particularly in terms of its scope, risk distribution, and policy agenda. This article examines how laws at the international and national levels regulate the privatisation of space ventures, the changes in regulation, important court decisions, unresolved issues, and suggestions for a more effective governance regime. Besides the comparative analysis of the USA, Luxembourg, Japan, and India, the article presents ideas for the future legal framework.
Keywords: Private Entities, Space Law, Commercialisation, Liability, National Legislation
Introduction
The space industry has evolved and is not a traditional business model where the state solely runs the show. Instead, private companies such as SpaceX, Blue Origin, and budding companies from India and Europe have come to dominate the scene. The change has been facilitated by a series of rapid technological innovations and expensive space missions that have forced states to look for other ways to facilitate and, at the same time, regulate the industry. The international outer space law regime was established with the 1967 Outer Space Treaty (OST) and its companion agreements, which were developed before the sector was commercialised. The interaction of multilateral treaties with domestic legal regimes forms the basis of the discussion governing privatisation in space today.[1]
Legal Framework for Private Enterprises in Space
International Treaties: Core Obligations
International space law is based on five main United Nations treaties. Of these, the OST is the key treaty, which, among others, governs the non-appropriation of outer space, international responsibility for activities, liability for damage, rescue and return of astronauts, and the registration of objects launched into space. Importantly, Article VI of the OST makes states responsible for national activities in outer space, whether governmental or non-governmental. States are not only obliged to authorise the activities of private actors, but also to supervise them regularly.[2]
Still, these treaties in none of their provisions explicitly point to the ownership rights of natural or legal persons. The OST prohibits national appropriation; thus, it is not clear whether private individuals have the right to own property or if the resources can only be exploited. Since major powers of outer space have not ratified the Moon Agreement (1979) – which was trying to further the issues by clarifying them – it remains a theoretical concept.[3]
National Legislation: The Shift to Commercialisation
Aware of the restrictions of international law, major spacefaring countries have established laws that regulate private activities within their territories.
The US opened the commercial launch section by passing the Commercial Space Launch Act (1984). The Commercial Space Launch Competitiveness Act (2015), in its turn, enables US citizens to possess the new resources that were derived from asteroids and other celestial bodies. The law, however, does not feature a sovereignty claim for these bodies and puts a condition that companies be under the jurisdiction of the US.[4]
Luxembourg’s Space Resources Act (2017) is designed to offer a high level of legal certainty for resource extraction and to facilitate inalienable ownership of materials by the companies from which they were extracted, thus aiming at turning Luxembourg into a centre of private space mining activities.[5]
Japan has prepared national legislation with a licensing regime and liability rules for commercial activities that are partly based on U.S. and Luxembourgish frameworks.
India, on the other hand, has not yet performed in the field of space by creating a comprehensive national space law, although it is a major spacefaring nation. The country has taken up a phased regulatory approach; thereby, the Indian Space Policy (2023) and the Indian National Space Promotion and Authorisation Centre (IN-SPACe) guidelines are only facilitators of private activity and are not equipped with detailed legal architecture.[6]
The Role and Liability of Private Entities
Expansion of Private Activities
Private entities have transitioned from supporting state programs to carrying out satellite launches, developing reusable rockets, and venturing into space tourism and resource extraction. This broadening activity has lowered entry costs and accelerated innovation, but introduces legal complexities regarding responsibility, liability, and equitable access to space resources.[7]
State Responsibility and Liability
Article VI OST imposes an international obligation on states to be responsible for all national activities in space, which includes activities of private actors as well. The Liability Convention of 1972 provides for the liability rules for damages done on the Earth (absolute liability) as well as in space (fault-based liability). If private companies cause damage, the state from where the rocket was launched is internationally liable, but can get the money from the actual perpetrators based on domestic law.[8]
Case Law and Disputes
Less space law case law is available in traditional space law, as most disputes are settled through diplomatic channels or contracts. One of the most significant cases is that of COSMOS 954 (1979),[9] where the Soviet Union was held responsible for radioactive waste from its satellite crashing in Canada and based on this, state responsibility under the Liability Convention was established. Though not involving a private entity, it sets a state liability for space activities as a fundamental principle.
In the case of Nemitz v. NASA (Eros Asteroid Case, 2004)[10] US federal courts addressed the property rights of an asteroid after Gregory Nemitz claimed private ownership of Eros and sought rent from NASA for landing its NEAR Shoemaker probe.
In the Thor Rocket Incident (1960, Cuba),[11] Debris from a US Thor DM-21 rocket fell on Cuban territory, reportedly killing a cow. The United States and Cuba settled the claim diplomatically, and the incident highlighted the need for international liability rules before the 1972 Liability Convention.
The transformation of Intelsat from an international organisation to a privatised company, illuminating regulatory changes in the space commercial sector, however, with little specific litigation. Most private space disputes are settled through contracts, which stipulate governing law and arbitration forums.[12]
Ambiguities and Emerging Challenges
Property Rights and Resource Appropriation
One of the major legal uncertainties is about the ownership rights of space resources. Even though the OST forbids the countries from claiming the sovereignty of space, it does not clearly say that private companies cannot have a property right over the materials obtained from space. Therefore, there is disagreement between these two laws, as the US and Luxembourg legislation allow private entities to own the resource that will be extracted in a foreign celestial body, while others argue that such a move may violate the concept of the “common heritage of mankind” principle.
Intellectual Property Rights
On the issue of space inventions and IP rights, the Indian government, after analysing the draft of the Space Activities Bill, decided to own the IP resulting from the inventions in space, so it may hamper private innovation until the government takes another position.[13]
Environmental and Security Risks
The existing regulations do not provide enough room to solve the problems of space debris, overcrowding of orbits and congestion of the orbital zone, which are some of the consequences of the use of space. Besides these issues, the situation is further complicated by the use of space for military purposes and the matters associated with weaponisation. There are no concrete international regulations binding private entities, which are the leading contributors to space traffic and are under different national regulations and mostly follow the international guidelines voluntarily.[14]
Regulatory Uncertainty
The existence of different and fragmentary national regulatory frameworks, along with the slow pace of international negotiations, makes it difficult for companies to access the market. The requirements for insurance, liability, and licensing vary significantly from one place to another, thus hindering the willingness of investors and facilitating cooperation among the players of the global space industry.[15]
Suggestions and Regulatory Solutions
Strengthening International Cooperation
Acutely necessary are new multilateral agreements or protocols that give more clarity about permissible private space activities, resource rights, and dispute resolution concerning private actors. Such an alignment effort should be led by international organisations like the United Nations Committee on the Peaceful Uses of Outer Space (UNCOPUOS) that also facilitate the participation of new space countries.[16]
Modernising Domestic Laws
National space legislations must be detailed enough to regulate the licensing, liability, insurance, and control of private actors. It is of utmost importance to modify intellectual property laws in such a way that there is a trade-off between the incentive to innovate and the public interest, and that this is done based on the successful models of the leading countries.[17]
Improving Sustainability and Safety
Measures regarding debris mitigation and collision avoidance should be supported by global technical standards and open data sharing, and the Artemis Accords could be one of the frameworks they build upon. The mechanisms for dispute resolution, such as arbitration or specialised courts, ought to be further developed so that they can assure the expedient and just handling of space-related disputes.[18]
Conclusion
The move to have private enterprises take part in space exploration is a revolutionary one; thus, these kinds of situations demand not only adaptable but also comprehensive legal frameworks. Even though there have been considerable moves, mostly through national legislations, made by states, there are still major uncertainties in the law with regard to property rights, liability, environmental protection, and regulatory uniformity. It is of utmost importance to harmonise international principles and effective domestic regulation in order to both foster innovation and, at the same time, safeguard equitable and sustainable access to outer space. Finding the right balance between enabling private sector participation and putting in place strong governance mechanisms will, on the one hand, attract investments to the new space economy and, on the other hand, prevent reckless behaviours and misuse, thereby creating win-win scenarios for all actors and humanity as a whole.[19]
References (OSCOLA Format)
- R Launius, NASA: A History of the US Civil Space Program(Krieger Publishing, 2001)
- J Logsdon, The Space Race: The Story of the Competitive Struggle Between the United States and the Soviet Union(Smithsonian Institution Press, 1998)
- ‘The Role of Private Entities in Outer Space Activities’ (2025) 7(2) International Journal for Multidisciplinary Research https://ijfmr.com/IJFMR250241334.pdf accessed 9 November 2025
- ‘Space Law 2025 – India – Global Practice Guides’, Chambers and Partners (2025) https://practiceguides.chambers.com/practice-guides/space-law-2025/india accessed 9 November 2025
- ‘India Needs a National Space Law’, NEXT IAS Current Affairs (22 August 2025) https://www.nextias.com/current-affairs/22-08-2025/india-needs-a-national-space-law accessed 9 November 2025
- ‘Private property and militarisation: the new frontiers of space law’, Polytechnique Insights (29 October 2025) https://polytechnique-insights.com/en/braincamps/space/private-property-and-militarisation-the-new-frontiers-of-space-law/ accessed 9 November 2025
- ‘International Space Law: United Nations Instruments’, United Nations Office for Outer Space Affairs (2025) https://www.unoosa.org/oosa/en/ourwork/spacelaw/index.html accessed 9 November 2025
- A Janikowski, ‘The investment impact of enacting space resources legislation: Evidence from Luxembourg and the United States’ (2025) ScienceDirect https://www.sciencedirect.com/science/article/pii/S0040162525000765 accessed 9 November 2025
- ‘Need for a National Space Law in India’, Drishti IAS (21 August 2025) https://www.drishtiias.com/daily-updates/daily-news-analysis/need-for-a-national-space-law-in-india accessed 9 November 2025
- ‘India’s urgent need for Comprehensive National Space Legislation’, VisionIAS (21 August 2025) https://www.visionias.in/need-for-a-national-space-law-in-india/ accessed 9 November 2025
[1] The Role of Private Entities in Outer Space Activities’ (2025) 7(2) International Journal for Multidisciplinary Research https://ijfmr.com/IJFMR250241334.pdf accessed 9 November 2025
[2] ‘International Space Law: United Nations Instruments’, United Nations Office for Outer Space Affairs (2025) https://www.unoosa.org/oosa/en/ourwork/spacelaw/index.html accessed 9 November 2025
[3] ‘Private property and militarisation: the new frontiers of space law’, Polytechnique Insights (29 October 2025) https://polytechnique-insights.com/en/braincamps/space/private-property-and-militarisation-the-new-frontiers-of-space-law/ accessed 9 November 2025
[4] ‘The Role of Private Entities in Outer Space Activities’ (2025) 7(2) International Journal for Multidisciplinary Research https://ijfmr.com/IJFMR250241334.pdf accessed 9 November 2025
[5] A Janikowski, ‘The investment impact of enacting space resources legislation: Evidence from Luxembourg and the United States’ (2025) ScienceDirect https://www.sciencedirect.com/science/article/pii/S0040162525000765 accessed 9 November 2025
[6] ‘India Needs a National Space Law’, NEXT IAS Current Affairs (22 August 2025) https://www.nextias.com/current-affairs/22-08-2025/india-needs-a-national-space-law accessed 9 November 2025
[7] ‘Private property and militarisation: the new frontiers of space law’, Polytechnique Insights (29 October 2025) https://polytechnique-insights.com/en/braincamps/space/private-property-and-militarisation-the-new-frontiers-of-space-law/ accessed 9 November 2025
[8] ‘International Space Law: United Nations Instruments’, United Nations Office for Outer Space Affairs (2025) https://www.unoosa.org/oosa/en/ourwork/spacelaw/index.html accessed 9 November 2025
[9] Protocol between Canada and the USSR on Settlement of Claim for Damage Caused by “Cosmos 954” (signed 2 April 1981, entered into force 2 April 1981) https://www.unoosa.org/pdf/ser851_1/f0110914.pdf accessed 10 November 2025.
[10] Nemitz v National Aeronautics and Space Administration (D Nev, No CV-N-03-0591-HDM(VPC), 27 April 2004).
[11] Mansors, ‘Liability for Damage Caused by Space Objects’ (31 August 2022) https://mansors.com/liability-for-damage-caused-by-space-objects/ accessed 10 November 2025.
[12] The Role of Private Entities in Outer Space Activities’ (2025) 7(2) International Journal for Multidisciplinary Research https://ijfmr.com/IJFMR250241334.pdf accessed 9 November 2025
[13] ‘Space Law 2025 – India – Global Practice Guides’, Chambers and Partners (2025) https://practiceguides.chambers.com/practice-guides/space-law-2025/india accessed 9 November 2025
[14]‘Need for a National Space Law in India’, Drishti IAS (21 August 2025) https://www.drishtiias.com/daily-updates/daily-news-analysis/need-for-a-national-space-law-in-india accessed 9 November 2025
[15] ‘India’s urgent need for Comprehensive National Space Legislation’, VisionIAS (21 August 2025) https://www.visionias.in/need-for-a-national-space-law-in-india/ accessed 9 November 2025
[16] A Janikowski, ‘The investment impact of enacting space resources legislation: Evidence from Luxembourg and the United States’ (2025) ScienceDirect https://www.sciencedirect.com/science/article/pii/S0040162525000765 accessed 9 November 2025
[17] ‘Space Law 2025 – India – Global Practice Guides’, Chambers and Partners (2025) https://practiceguides.chambers.com/practice-guides/space-law-2025/india accessed 9 November 2025
[18] ‘Need for a National Space Law in India’, Drishti IAS (21 August 2025) https://www.drishtiias.com/daily-updates/daily-news-analysis/need-for-a-national-space-law-in-india accessed 9 November 2025
[19] ‘India Needs a National Space Law’, NEXT IAS Current Affairs (22 August 2025) https://www.nextias.com/current-affairs/22-08-2025/india-needs-a-national-space-law accessed 9 November 2025
