Thursday, November 26, 2015

Say Hello to the New US Commercial Space Launch Competitiveness Act

          By Chuck Black

US president Barack Obama has just signed into law the Commercial Space Launch Competitiveness Act (HR 2262) of 2015. The action is a pointed reminder that lawmakers, advocates and those who can access the resources are often the real facilitators of space exploration.

If Canada wishes to compete effectively in the next great space age, we might want to consider passing a similar law.

An infographic outlining the possible profits to be made from the nascent space mining industry. As outlined in the November 10th, 2015 press release, "Planetary Resources Applauds U.S. Congress in Recognizing Asteroid Resource Property Rights," the legislation encourages "private sector investment" and "a more stable and predictable regulatory regime." According to the November 16th, 2015 press release, "Deep Space Industries Congratulates U.S. Congress on Landmark Legislation," the extension of ownership rights under US law to now include recovered space resources, as outlined in HR2262, "will allow the capital markets to take a closer look at the space resource utilization industry, now that we have a legal framework for operations.” Graphic c/o Planetary Resources

As outlined in the November 24th, 2015 Fortune article, "Obama is About to Give Private Space Companies a Big Break," the HR2262 bill has passed both the US Senate and Congress and was widely expected to be signed into law just before the US Thanksgiving holiday.

According to the article, HR2262 would extend a so-called “learning period” for the industry until at least 2023, keeping agencies like the Federal Aviation Administration (FAA) from regulating commercial space companies as closely as the rest of the aerospace industry. The intent of the bill is to exempt start-up "newspace" companies such as SpaceX, Blue Origin, and Virgin Galactic from most US government oversight and regulation for the next eight years, as they develop and test new technologies.

The current act is the follow-on from a 2004 bill, which was set to expire at the end of this year.

HR2262 also:
  • Defines and codifies ownership and extraction of resources in space in a manner consistent with existing US law. 
  • Extends third party indemnification for launch services companies through September 30, 2025.
As outlined in the November 14th, 2015 Space Safety Magazine article, "Senate Passes Compromise Commercial Space Bill," HR2262 even provides a "use policy" for NASA’s space launch system (SLS).

 HH2262 isn't a new idea. This paper on "Creating A Robust Canadian Space Research Exploration & Development Industry - The Canadian Mineral Industry Flow-Though Share Analog," written by a mining executive and three MacDonald Dettwiler (MDA) senior executives, was originally presented at the 2008 Canadian Space Summit. Its thesis was that private capital would flow into the space industry if the government provided the same tax breaks and legal protections (such as the ability to stake a "claim" on space based resources) as was provided to the mining industry.  The paper became the basis for the second of  three Canadian Space Commerce Association (CSCA) submissions to the 2012 Emerson Aerospace review under the title "Using Tools from the Mining Industry to Spur Innovation and Grow the Canadian Space Industry." Graphic c/o CSS

Of course, not everyone is happy with the new law, especially its provisions related to the ability of individuals and the private sector to stake claims over space based assets as a preliminary to working those claims and ownership of the assets which may be derived from those claims.

As outlined in the November 26th, 2015 NewEurope article, "Obama signs controversial space ownership law," it "remains unknown whether the unilateral move by the US to claim space ownership is valid."

The article also quoted the Popular Science website that, "according to the Outer Space Treaty, which the US, Russia, and a number of other countries have signed, nations can’t own territory in space," and despite arguments claiming otherwise "this prohibition also extends to private entities.”

But, for those who'd care to check, there are obvious, relevant, historical examples of what did happen in situations where resources were subject to multiple competing claims and jurisdictions.

Back in the day when he was simply the ex-president of the Canadian Space Society (CSS), future Deep Space Industries CEO Daniel Faber wrote an interesting commentary on "Who Owns the Moon?: Extraterrestrial Aspects of Land and Mineral Resources Ownership" by Virgiliu Pop. As outlined in the February 5th, 2010 post, "Feedback on 'The Men Who've Sold the Moon',"  history has a number of examples that show "how the implementation of appropriate ownership rights over a communally owned environment," can allow individuals, corporations and even nations to benefit from the exploitation of natural resources, whether they're on Earth or in space. 

One example would be the 1848 California gold rush. The initial find was in Sutter's Mill, California, which was then technically a part of Mexico, although the territory was under American military occupation in the aftermath of the Mexican–American War. This historical situation created an environment where local residents operated under a confusing and changing mixture of Mexican rules, military regulations, American principles and personal dictates.

So what happened?

Essentially, the initially unorganized locals (and not the far distant, competing governments in Washington and Madrid) coalesced their disparate principles and dictates into a coherent system of rules they could operate under, for which ownership of resources required both access to the resource being claimed and the ability to utilize the resource within a reasonable time frame. Those who couldn't access and work a claim would lose it in favor of those who could.

By the 1860's many of these ad-hoc regulations had been proven so successful at adjudicating claims and encouraging development that they had been incorporated into US Federal law, where they mostly remain to this day.

HR2262 is a logical progression of earlier US laws and regulations in this area.


And the earlier gold rush in California is of direct relevance now, when access to space is not easily assured by private prospectors or even nation states, and space activities are addressed by possibly contradictory national laws (the most recent of which is HR2262) and international treaties (especially the 1967 Outer Space Treaty).

Of course, the basics of the technology needed to harvest space resources has existed for some time, and access to space is now improving thanks to companies such as SpaceX, Blue Origin, and Virgin Galactic, who were given several additional years of reduced regulations as part of other provisions included within HR2262.

And now that at least one nation has allowed for the legal ability to make an advanced claim on space resources, we can begin moving forward in this area.

Chuck Black.
It least, that's the case if you're an American citizen or corporation subject to US laws which now include HR 2262.

But Canadians are neither creating the laws, nor building the rockets nor in possession of the appropriate assets to stake a competitive claim in this area.

We should change this and the first step in doing so is to pass our own version of HR2262.
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Chuck Black is the editor of the Commercial Space blog. He also wrote the second of three CSCA submissions to the 2012 Emerson Aerospace Review. 

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