Space Law 2024 Comparisons

The Space Treaties

The UK is party to the following foundational space treaties:

• the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies 1967 (the Outer Space Treaty or OST);
• the Agreement on the Rescue of Astronauts, the Return of Astronauts and the Return of Objects Launched into Outer Space 1968 (the “Rescue Agreement”);
• the Convention on International Liability for Damage Caused by Space Objects 1972 (the “Liability Convention”);
• the Convention on Registration of Objects Launched into Outer Space 1975 (the “Registration Convention”); and
• the Constitution and Convention of the International Telecommunication Union 1992 (the “ITU Convention”).

In common with most major spacefaring nations, the UK is not a party to the Agreement Governing the Activities of States on the Moon and Other Celestial Bodies (the “Moon Agreement”). The UK was, however, one of the founding member nations to sign the Artemis Accords established by NASA.

Current Domestic Legislation

The UK was one of the first nations to implement a domestic space law: the Outer Space Act 1986 (OSA). Since 1986, the UK has continued to develop its domestic legal and regulatory framework. There are three current sources of space law in the UK’s domestic legislation:

• The OSA: The OSA as amended by the Deregulation Act 2015 governs the outer space activities of UK nationals (legal and natural) from overseas, including in the British Overseas Territories. The OSA does not apply to activities carried out from the UK.
• The Space Industry Act 2018 (SIA): Since 2018, the SIA has governed the space activities, sub-orbital activities and associated activities in the UK by UK or foreign nationals (legal and natural).
• The Air Navigation (Amendment) Order 2021 (ANO): The ANO has limited relevance. It applies to activities carried out in the stratosphere only (ie, up to approximately 50km above the earth).

The SIA is supplemented by the following regulations:

• the Space Industry Regulations 2021 (SIR), which enable the licensing and regulation of spaceflight activities, spaceports, and range control services in the UK;
• the Spaceflight Activities (Investigation of Spaceflight Accidents) Regulations 2021, which establish a spaceflight accident investigation body and make provision about the conduct of accident investigations; and
• the Space Industry (Appeals) Regulations 2021, which outline the decisions made by the regulator that may be appealed by a licence applicant or licence holder, plus create a decision-making body to hear appeals.

With regard to the licensing of space activities, the UK’s domestic legislation is supplemented by guidance issued by the UK’s space regulator, the Civil Aviation Authority (CAA). Much of this guidance takes the form of Civil Aviation Publication (CAP) documents. These include the Regulator’s Licensing Rules, set out in CAP 2221, which specify how to apply for and renew launch operator, spaceport and range control licences under the SIA.

Anticipated Domestic Legislation

In line with its ambition of facilitating the rapid growth of the UK’s space industry, the UK government has carried out a series of consultations and reviews to consider, among other things, how the UK’s space legislation, regulatory and licensing regimes are functioning, and to come up with proposals for how these can be improved (see 2.2 Legal System and Sources of Space Law and Regulation). On 22 May 2024, the UK’s then Prime Minister Rishi Sunak announced that a general election would be held on 4 July 2024 with Parliament to be dissolved on 30 May 2024. This had two effects on the UK’s domestic legislative programme for space.

First, all bills that were progressing through the Houses of Parliament at that time, but which had not yet received Royal Assent and therefore become law, were discarded. This included the Space Industry (Indemnities) Bill (see 2.8 Insurance and State Measures on Liability for Damages).

Second, it created uncertainty concerning what further space legislation, if any, the next UK government might introduce. None of the election manifestos published by any of the major political parties prior to election day contained any specific detail concerning the space industry. This lack of detail perhaps reflected the fact that the space industry was not a priority for the general election; it does not, however, indicate that the new Labour government will disregard the results of the various recent reviews and consultations carried out in respect of the aviation industry (see 2.2 Legal System and Sources of Space Law and Regulation).

The UK Space Industry Today

Having possessed domestic space legislation since 1986, the UK has one of the most established space industries around the world. It is estimated that in the last year the sector has grown by 15% and has contributed GBP5.7 billion to the UK’s GDP. As of March 2024, 48,000 people were directly employed in the space industry and, after the USA, the UK is currently the biggest single recipient of all private investment in the global space sector, receiving 17% of all such investment in 2022. 

The UK possesses several “clusters” located around the country that are home to groups of NewSpace companies. The most notable of these is located on the Harwell Science and Innovation Campus in Oxfordshire, which is home to the headquarters of the UK Space Agency (UKSA), the European Centre for Space Applications and Telecommunications (ECSAT) of the European Space Agency (ESA), and over 100 different NewSpace companies employing over 1,000 people. The range of companies involved in NewSpace in the UK is vast: it includes large multinationals such as Lockheed Martin and Airbus Defence and Space, established industry leaders like Astroscale, and many small start-ups that have been assisted by the various space accelerators and catapults operating in the UK.

The UK’s Ambitions

The UK government expressly recognises the importance of NewSpace and the opportunities it presents for further development. In particular, the UK government recognises the potential offered by the UK’s unique geographic position and its stated ambition is to establish the UK as the leading provider of commercial small satellite launches in Europe by 2030. To achieve this ambition, the UKSA is working closely with a range of companies located across the UK to develop the spaceports needed to facilitate launch, to develop the space assets and technologies that will be launched from them, and to develop the necessary supporting infrastructure.

In January 2023, Virgin Orbit carried out the first attempt at a horizontal launch from Spaceport Cornwall in Newquay, and in December 2023 the CAA issued the first licence for vertical launch in western Europe to SaxaVord Spaceport in Orkney followed by a range control licence in April 2024. It is anticipated that the first vertical launch from SaxaVord Spaceport will take place in Q3 of 2024. At the same time, the UKSA is working closely with other would-be UK spaceports, including Sutherland Spaceport and Snowdonia Aerospace Centre, to develop the UK’s launch capacity elsewhere.

The UK government has carried out several consultations and reviews involving a range of stakeholders from across the NewSpace industry (see 2.2 Legal System and Sources of Space Law and Regulation). That work has informed several strategy papers published by the UK government to outline its plans for developing the industry. The most recent of these are the National Space Strategy published in 2021 and updated in 2023 (the “National Space Strategy”) and the Space Industrial Plan published by the Department for Science, Innovation and Technology (DSIT) and the Ministry of Defence in March 2024 (the “Space Industrial Plan”).

The Jurisdiction

The UK contains three separate legal jurisdictions: England and Wales, Scotland and Northern Ireland. England and Wales comprise a common law jurisdiction. The jurisdictions of Northern Ireland and Scotland are mixed, incorporating features of both common and civil law traditions.

As described in 1.1 The New Space and Space Tech Economy, regardless of the specific jurisdiction within the UK, space activities carried on within the UK either by UK or foreign nationals (legal or natural) are governed by the SIA and accompanying regulations.

Case Law

There is very little publicly available UK case law applicable to space law. This reflects the fact that the growth of the NewSpace industry in the UK is a relatively recent phenomenon, with correspondingly limited opportunities for space-related disputes between private entities, and that most disputes relating to space are currently dealt with privately through arbitration.

The Future Legal Regime

In recent years, the UK government has carried out several consultations and published several reviews considering the UK’s domestic legal and regulatory regimes for space. The consultations and reviews have been carried out by various government and parliamentary bodies, including the UKSA, the Department for Transport (DfT), DSIT and its associated House of Commons’ Science, Innovation and Technology Committee (SITC), and they have typically featured heavy involvement from industry. The purpose of this work has been to identify weaknesses in the current system, propose possible solutions and ideas for improvement, and inform the national space strategies and plans identified in 2.1 Characteristics of the Space Industry.

Three of the most significant reviews include:

• the SITC’s report on “UK space strategy and UK satellite infrastructure: reviewing the licencing regime for launch” (the “SITC Report”), published in July 2023;
• the UKSA’s “Consultation on Orbital Liabilities, Insurance, Charging and Space Sustainability” (the “Liabilities Consultation”), which closed on 5 January 2024; and
• DSIT’s Space Regulatory Review (the “Regulatory Review”), published in May 2024.

The SITC Report identified several areas for improvement within the UK’s launch licencing regime in the aftermath of Virgin Orbit’s failed attempt at the UK’s first horizontal launch in January 2023. After consulting with the industry, SITC identified that key areas for improvement included, among other things: (i) increasing transparency and reducing duplication to streamline the licensing process; and (ii) developing a variable limits approach to third-party liability insurance for space operations (see 2.8 Insurance and State Measures on Liability for Damages). Overall, however, SITC concluded that the regime was working well and that the CAA was getting to grips with it as quickly as possible. 

The Liabilities Consultation featured several interesting proposals from the UKSA, focussing primarily on insurance but also encompassing space sustainability as well. As with the SITC Report, the Liabilities Consultation contained a proposal relating to variable liability limitations (see 2.8 Insurance and State Measures on Liability for Damages) and in respect of the discretionary cap on liability provided for by Section 12(2) SIA. This reflects the significance of the issue of liability to the industry. In addition, the Liabilities Consultation also contained proposals for reducing fees for operators’ licences, as well as for boosting space sustainability through a “Space Sustainability Roadmap”. The UKSA is currently considering the results of the Liabilities Consultation with a view to providing its legislative proposals in 2024 and implementing those proposals in 2025.

The Regulatory Review summarised the current position of the UK’s regulatory and legal regimes and considered how it can be improved to assist the UK in achieving the National Space Strategy and the Space Industrial Plan, again with substantial input from industry. The Regulatory Review also included the DfT’s review of the first five years of the SIA. While it concluded that the regime is functioning well, the Regulatory Review stated there is a greater need for clarity, certainty and confidence in order to deliver the desired growth of the UK’s space industry. To achieve this, it identified seven priority regulatory outcomes, supported by 17 recommendations, to be put into practice by a cross-government implementation team. It remains to be seen whether any legislative changes will result from the Regulatory Review.

The DfT and DSIT

The two government departments that are most concerned with the facilitation of the commercial development of space in the UK are the DfT, which has specific responsibility for commercial spaceflight, and DSIT. These departments are responsible for working with the relevant UK government ministers, including the Space Minister, by developing and implementing policy on space, including the development of NewSpace, and for dealing with space on a practical and administrative level.

Additionally, the Foreign, Commonwealth & Development Office (FCDO) is likely to play an important role in facilitating the development of the UK’s launch capability and NewSpace in general. The FCDO is responsible for negotiating airspace access with other nation states, which is particularly important given the launch trajectories from the UK. More generally, the FCDO provides the UK with the ability to forge partnerships and bilateral agreements with other spacefaring nations (see 2.7 Commitment to International Treaties and Multilateral Discussions).

The UKSA

The UKSA is an executive agency of DSIT. In 2010, it succeeded the British National Space Centre as the co-ordinator of the UK’s space programme. It bears responsibility for the UK’s civil space programme and plays an active role in implementing the National Space Strategy.

The UKSA is now both a participant in the UK’s space industry and a facilitator of it. As participant, the UKSA is responsible for the UK’s membership of the ESA and it is involved in a wide variety of space missions. By way of example, the UKSA is heavily involved in the ESA-led Traceable Radiometry Underpinning Terrestrial- and Helio-Studies (TRUTH) programme. As facilitator, the UKSA plays an important role in developing NewSpace and has developed the “LaunchUK” programme designed to grow the UK’s satellite launch capability and spaceflight industry. As part of this, the UKSA directs funding to the areas where it is most needed, assists the development of new companies through its accelerator programmes, works with the developing spaceports located across the UK and seeks to attract foreign companies to move to the UK (see 7.2 Finance Sources for Space Activities).

The CAA

Article VI OST provides that state parties to it bear international responsibility for activities carried out in outer space by non-governmental entities. The UK is therefore responsible for space activities carried out by UK nationals.

Since 2021, that responsibility has been exercised by the CAA as the UK’s space regulator. The CAA is responsible for overseeing the SIA and the OSA. This includes overseeing applications for spaceports, launch, return, range control and in-orbit activities, as part of which the CAA is chiefly concerned with ensuring public safety. The CAA engages closely with applicants and supports them during the process, including by publishing detailed guidance on how it will apply and interpret the relevant legislation. After licencing is complete, the CAA continues to monitor space operators, and it has the power to administer fines for breaches of the relevant legislation and of any conditions contained within the relevant licence.

The SIA, the OSA and the ANO

The SIA and accompanying regulations govern the licensing regime for space activities to be carried out from the UK. The OSA governs the licensing regime for space activities to be carried out abroad. In each case, the process is overseen by the CAA. The ANO governs activities carried out no higher than the stratosphere. The CAA’s approach is to align the regulatory approach taken with respect to each regime as much as possible.

Space Activities Carried Out in the UK

Under Sections 3(1) and 3(6) SIA, it is an offence to carry out space activities or to operate a spaceport within the UK except under the authority of a licence issued by the CAA. Pursuant to Section 53 SIA, a party that carries out space activities or operates a spaceport without a licence may be liable to a fine or a prison sentence.

Section 1(4) SIA defines a “space activity” as including launching or procuring the launch or returning any space object (or aircraft carrying a space object), operating a space object, and any activity carried out in outer space. 

The CAA is responsible for issuing “operator licences” and “spaceport licences”. Spaceport licences cover the operation of spaceport facilities within the UK, while operator licences cover the following activities:

• launch – ie, launching space objects or launch carriers from the UK;
• return – ie, the return of space objects to the UK following re-entry from outer space; and
• orbital operations – ie, operating a satellite or spacecraft in outer space from the UK.

The CAA also grants “range control” licences, which govern the provision of range control services in respect of licensed spaceflight activities (ie, launch or return) in a specified location (typically a spaceport). The UK is unusual in this respect because, in the majority of other jurisdictions, range control services are reserved to the state and cannot be undertaken by private entities.

Per Article II of the Registration Convention, the CAA maintains a publicly accessible register of the different licences it has granted. This records the name of the entity and the date when the licence was issued, and allows the public to view the terms of each licence and the accompanying oversight and monitoring plan issued by the CAA.

The Licensing Process

Applications for licences must be made to the CAA. Applicants must show that they comply with the relevant requirements for each licence as set out in the SIR and the Regulator’s Licensing Rules. There is no application fee for a launch, return, range or spaceport licence, but there is a set fee of GBP6,500 for each orbital operator licence.

To assist applicants in this process, the CAA has published extensive guidance in several CAP documents, which are updated regularly. The most important of these is CAP 2209: “Applying for a licence under the Space Industry Act 2018”. These documents help applicants navigate the necessary forms and ensure that they provide the CAA with the necessary information to allow them to determine applications as quickly as possible.

When considering applications, the CAA will often work closely with other regulatory bodies. In cases where the applicant is seeking to operate a satellite in space and therefore needs to obtain an orbital position and a satellite filing, this will include the Office of Communicatons (see 2.5 Role of the State in Co-ordinating the Use of Radio Frequencies and Orbital Slots). In most cases, the CAA will also liaise with various environmental agencies to assess the environmental impact of the proposed activity.

Licence applications are made using an online form, which is dictated by Section 18 SIR. The form requires applicants to provide details of the applicant’s legal status and their financial and technical resources. Depending on which type of licence an applicant is seeking, the form also requires additional information regarding the activities that the applicant is planning to perform, and it also requires applicants to provide information about the individuals who will be holding “prescribed roles” (such as “launch director”) in respect of those activities.

Pursuant to Section 8 SIA, the CAA may only grant a licence if it is satisfied that doing so will not impair the UK’s national security, is not inconsistent with the UK’s international obligations, and is not contrary to the national interest. It must also be satisfied that the applicant has sufficient resources to carry out the activities in question, and that the applicant (and the individuals holding “prescribed roles”) is a fit and proper person. The criteria for assessing these considerations are set out in Chapter 1 of the SIR.

Applicants for launch, return and spaceport licences must also provide a safety case with their applications, which must demonstrate to the CAA that the applicant has identified all major hazards that may arise from the planned activities and that the applicant has taken the necessary measures to ensure that risks are kept as low as reasonably possible. This includes a cybersecurity plan (see 3.1 General Rules on Space Activities).

There is no set length for the licence application process. However, the CAA advises that applications should be made at least six months before the licence in question is needed. The CAA also advises that applicants should contact it prior to making an application in order to apprise the CAA of its plans to obtain specific guidance as to how each stage of the application works.

If an application is refused, Section 60 SIA provides that applicants can appeal the CAA’s decision following the procedure set down in Schedule 10 to the SIA and the Space Industry (Appeals) Regulations 2021. The CAA has provided guidance as to how the appeal process operates for decisions made under either the OSA or the SIA in CAP 2216.

Registration of Space Objects

Article II of the Registration Convention requires launching states to maintain a registry of space objects to provide information relating to such space objects to the United Nations. This obligation is reflected in Section 7 OSA and Section 61 SIA. In relation to each launch, the CAA is required to register the date of the launch, the spaceport at which the launch took place, the nature of the spacecraft involved, and the purpose of the launch. The CAA maintains this register on its website. It also maintains a “supplementary” register, which sets out details of space objects covered by OSA and SIA licences in respect of which the UK is not a launching state for the purposes of the Registration Convention. 

Licence Conditions and Ongoing Monitoring

When granting a licence, Section 13(1) SIA permits the CAA to impose any conditions it sees fit on the licence. Such conditions may include, for example, an obligation to provide the CAA with regular updates on the environmental impact of the activities covered by the licence (see 5.1 Environmental Protection in Space).

Section 26 SIA requires the CAA to carry out ongoing monitoring of space activities, and this is done by way of an “oversight and monitoring plan” imposed on the licensee. This fulfils the UK’s duty to supervise the activities of its nationals pursuant to Article VI OST. One way in which the CAA does this is by requiring all orbital operators to provide annual information on the conditions of their satellites as part of a “health check”.

The Office of Communications

The UK has been a member of the International Telecommunications Union (ITU) in one form or another since 1871. It is currently a member of the ITU Council for Region B (Western Europe), with its current term ending in 2026.

Ofcom is the UK’s regulator for broadcasting and telecommunications. It is also responsible for administering spectrum in the UK, as part of which it carries out three functions:

• granting licences to satellite earth stations located in the UK under the Wireless Telegraphy Act 2006 (WTA);.
• managing satellite filings for UK-registered entities and notifying these to the ITU; and
• representing the UK internationally, including at the World Radiocommunication Conferences (WRC), which are held every three to four years.

Operators must apply to Ofcom to obtain an orbital position and associated spectrum satellite filing, which is then submitted to the ITU. Before notifying a filing to the ITU, Ofcom must first satisfy itself that the filing meets the requirements of the ITU Radio Regulations and Ofcom’s other conditions. Ofcom also deals with the transfer of satellite filings from one operator to another.

Other Regulators

Ofcom works closely with UK government bodies and regulators, including the CAA. Ofcom and CAA co-operate particularly on satellite filings, licences, and spectrum authorisation for launch operations. Ofcom also contributed to the National Space Strategy. Ofcom has also appointed the CAA as the band manager for several sets of radio spectrum frequencies,

When applying for licences under the OSA or the SIA, applicants are required to provide evidence to the CAA that they have access to a spectrum frequency and associated orbital position. To assist with this, applicants must complete a Radio Frequency/Spectrum Question Set (SRG2229), which requires the applicant to identify the satellite filing that the operator will be using, the orbital station to be used by the space object, and the ground stations that will be used on Earth. This information is then shared with Ofcom, and this allows the CAA and Ofcom to maintain a co-ordinated approach to the management of frequency and orbital slot allocations.

Harmful Interference

In accordance with Article 15 of the ITU’s Radio Regulations, Ofcom is responsible for investigating harmful interference in the UK and, where necessary, taking enforcement action to prevent it. This can include directing a satellite operator to cease transmission and, if the issue persists, prosecution leading to fines and prison sentences.

The Future

In November 2022, Ofcom published its updated strategy for managing the use of spectrum by the UK’s space industry. The strategy recognises the rapid growth of NewSpace in the UK as well as the increasing significance of earth observation data for the purpose of tackling climate change, and sets out Ofcom’s plans for ensuring that sufficient spectrum is made available to meet these needs. To achieve this aim, Ofcom committed to consulting on proposals covering, among other things, the authorisation of Earth gateways for new spectrum bands and the granting of stronger enforcement powers to Ofcom to prevent harmful interference.

Regulation and Licensing of Launch

See 2.4 Role of the State in the Licensing Process for Space Activities.

Facilitation of Launch

See 2.3 Role of the State in Space Law and Regulations, 7.2 Finance Sources for Space Activities and 7.3 Attracting Investment for Space Activities.

Provision of Launch

The UKSA does not possess any launching capability and currently has no ambition to obtain this. As set out in the National Space Strategy and the Space Industrial Plan, the UK’s preferred approach is to foster the growth of a satellite launch industry through private companies instead.

The Space Treaties

See 1.1 The New Space and Space Tech Economy. The UK is a dualist jurisdiction, meaning that treaties and international law must be implemented in UK law to have effect domestically.

The UN Committee on the Peaceful Uses of Outer Space (COPUOS) and the UN Conference on Disarmament (CD)

The UK maintains a delegation to COPUOS and plays an active role in pushing forward the agenda in important directions, including in relation to space sustainability. For example, the UK provides funding through the UN Office for Outer Space Affairs (UNOOSA) for the promotion of the Guidelines for the Long-term Sustainability of Outer Space Activities (the “LTS Guidelines”).

The UK is also an active member of the CD. However, in 2022 the UK Delegation to COPUOS informed the Committee of its view that COPUOS and the CD deal with separate issues and need to be kept separate as a result.

The International Telecommunication Union

See 2.5 Role of the State in Co-ordinating the Use of Radio Frequencies and Orbital Slots.

Bilateral Agreements and Partnerships

The UK has entered into the following bilateral agreements and partnerships with other spacefaring nations:

• UK-USA Technology Safeguards Agreement – 17 June 2020;
• UK-Australia Space Bridge – 23 February 2021;
• UK-New Zealand Research, Science and Innovation Agreement – 1 July 2022;
• UK-ROK Space Cooperation Terms of Reference – 16 July 2022;
• UK-Japan Space Cooperation Terms of Reference – 17 March 2023;
• UK-EU Copernicus and Horizon Europe Participation Agreement – 7 September 2023; and
• UK-Canada Enhanced Memorandum of Understanding – 10 April 2024.

The UKSA maintains an International Bilateral Fund for the purpose of developing the UK space industry’s relationships with strategic and emerging space nations. In 2023, the UKSA committed to spending GBP20 million on suitable projects and invited proposals for how the funds should be applied.

The UK’s International Liability for Space Activities

Under Articles VI and VII OST, the UK is responsible for activities carried out by its nationals in outer space, and is internationally liable for any damage caused by a space object launched by or from the UK. The UK is also a signatory to the Liability Convention and qualifies as a “Launching State” in respect of any space objects launched by it or from its territory, as well as in respect of any launches procured by its nationals. Under Articles II and III Liability Convention, the UK is strictly liable for any damage caused by such space objects on land and in the air and will be liable on a fault basis for damage in outer space. This means that the UK is ultimately liable for any damage caused by satellites either launched from the UK or from locations overseas by UK nationals (legal and natural). Pursuant to Articles IX and XI OST, foreign states and persons (legal and natural) may pursue the UK for compensation in respect of damage suffered either through diplomatic means or in the UK’s domestic courts (but not both).

As part of the licencing process, the CAA requires applicants for launch and orbital licences to provide an indemnity to the UK government in respect of any damage that might be caused by their space activities (see Section 10(1) OSA and Section 36(1) SIA). The required indemnity may be unlimited but, in practice, each licence will specify a limit of liability (caps on liability are permitted by Section 12(2) OSA and Section 36(3) SIA). As explained in 2.8 Insurance and State Measures on Liability for Damages, applicants are required to hold third-party insurance to cover this potential liability (see Section 5(f) OSA and Section 38(1) SIA), and the terms of the insurance required are specified on each licence.

Current Requirements

The CAA is permitted by Section 5(2) OSA and Section 38(1) SIA to impose insurance requirements as a condition of a licence. The CAA’s current practice is to impose the following indemnity and insurance requirements as conditions of licences for space activities:

• procuring a launch outside the UK (OSA): GBP60 million indemnity and matching third-party liability cover;
• procuring or carrying out a launch inside the UK (SIA): calculated using the Modelled Insurance Requirement (MIR) model;

• carrying out orbital operations from within the UK (SIA) or outside the UK (OSA):
1. low-risk missions: insurance requirement may be waived, but GBP60 million indemnity remains;
2. standard-risk missions: GBP60 million indemnity and matching third-party liability cover; and
3. higher-risk missions: potentially >GBP60 million indemnity and matching third-party liability cover.

Third-party insurance held in respect of orbital operations may be held on an “any one occurrence” basis, as well as with an aggregate limit, if the CAA deems this to be appropriate. When determining the appropriate risk level for orbital operations, the CAA will consider whether the mission is novel in nature or scale, whether it uses unproven technologies, and whether it presents a higher risk of third-party liability claims.

The MIR is used to calculate the minimum amount of third-party liability insurance required for a launch under either the OSA or the SIA. It is similar to the Maximum Probable Loss approach used in the USA: it involves an assessment of the insurance available in the market at the relevant time, a calculation of the probability of a launch failure occurring, and a calculation of the maximum possible third-party claims that might be made against an operator as a result. The results of the exercise are then recorded as the third-party insurance and indemnity requirement on the launch licence.

Future Requirements

Industry and government alike have recognised the development of the UK’s insurance requirements as being vital for the growth of NewSpace in the UK and for the UK’s launching capability in particular. Insurance was one of the key issues considered in the Liabilities Consultation and the SITC Report (see 2.2 Legal System and Sources of Space Law and Regulation), and it also features heavily in the National Space Strategy and the Space Industrial Plan. Two areas for reform include the use of variable limits and the linking of space sustainability to reduced insurance and indemnity requirements. Whether any legislative changes will be made in this area remains to be seen pending the outcome of the Liabilities Consultation.

As noted in 1.1 The New Space and Space Tech Economy, the Space Industry (Indemnities) Bill was recently shelved following the dissolution of Parliament. A short but important piece of legislation, the intention behind this bill was to increase certainty in the industry by requiring the CAA to specify an indemnity limit in licences in all cases.       

Limitations on Space Activities

As explained in 2.4 Role of the State in the Licensing Process for Space Activities, pursuant to Section 8 SIA, the CAA will only grant a licence to cover a space activity if doing so is not contrary to the national interest, if it is not inconsistent with the UK’s international obligations, and if it does not compromise the UK’s national security. The CAA does not typically impose time limits on licences but has a wide discretion to impose other conditions.

Cybersecurity

When applying for a licence, launch and return operators must provide the CAA with a safety case (see 2.4 Role of the State in the Licensing Process for Space Activities). This must contain a cybersecurity plan, which must detail the cybersecurity risks faced by the applicant and the steps taken to mitigate those risks. The UKSA has published a Cyber Security Toolkit, which contains recommendations (ie, non-mandatory guidelines) designed to help operators manage their cybersecurity risks. The UKSA recommends that owners of space assets should look to achieve a Cyber Essentials Plus certification from the National Cyber Security Centre (NCSC). If the level of risk faced by the operator is categorised as either Level 4 (Significant) or Level 5 (Catastrophic), the UKSA recommends that the operator should be implementing ISO 27001 (a cybersecurity standard designed by the International Organization for Standardization).

Data Protection

The UK has implemented the General Data Protection Regulation through the Data Protection Act 2018 (the DPA). The UK’s data protection regulator is the Information Commissioner’s Office (ICO). The DPA applies to all data controllers and processors based in the UK, as well as any data processors or controllers based outside the UK provided that they offer goods or services or monitor the behaviour of individuals within the UK. This means that the DPA is very likely to apply to any entity carrying out space activities within the UK. Paragraph 25 of Schedule 1 to the SIA also provides that the CAA may impose conditions in a licence relating to the use, processing, communication, and distribution of data obtained during launch, return or orbital operations.

Breaches of personal data must be reported to the ICO. The Cyber Security Toolkit recommends that incidents should also be reported to the NCSC and UKSA, so that warnings and information can be shared among the space community.

The UK is obliged by Article IX OST to consult with other nation states where it becomes aware that any space activity planned by one of its nationals may potentially cause harmful interference to the activities of another state.

Regulation 101 SIR provides that all operators must take reasonable steps to ensure that their space activities avoid interfering with other space activities. Regulation 101 also provides that operators must take reasonable steps to limit or prevent major accident hazards to the health, safety and property of other space objects, including by monitoring the trajectory and orbital positioning of their space objects, avoiding the release of space debris and, if possible, by manoeuvring their space objects. The CAA recommends that operators comply with the IADC Space Debris Mitigation Guidelines issued by the Inter-Agency Space Debris Coordination Committee (IADC) when considering which “reasonable steps” are required by Regulation 101 SIR.

The UK also seeks to prevent harmful interference from occurring at the licensing stage. Regulation 29 SIR requires all applicants for spaceflight licences to provide the CAA with a safety case, as part of which they must provide the CAA with the information contained in Schedule 1 and must demonstrate that their proposed activities will not interference with the activities of others in the peaceful exploration and use of outer space. One way for applicants to do this is to adopt best practices for avoiding collisions and minimising debris, while also making specific design choices to avoid potential break-ups and collisions in orbit. The CAA will also make it a licence condition that the applicant must also carry out a Launch Collision Avoidance Analysis (LCOLA) before launch.

Operators’ Obligations

See 2.4 Role of the State in the Licensing Process for Space Activities and 3.2 Principles of Non-interference and Prevention of Harmful Interference above for information on operator’s safety and sustainability obligations and how these are monitored and enforced by the CAA.

Sustainability in Outer Space

The UK is committed to improving the sustainability of space activities themselves and is seeking to position itself as a global leader on the issue of debris removal. In 2022, the UK government announced a Plan for Space Sustainability, in which it proposed to review the regulatory framework and establish a new Space Sustainability Standard to incentivise sustainable space practices. The results of the UK government’s review are due to be published shortly and it remains to be seen whether these will be translated into legislation. Separately, King Charles III announced the Astra Carta in June 2023 as a new global framework for the establishment and promotion of sustainable space activities. The Astra Carta places great emphasis on developing technology to effectively carry out In-Orbit Servicing and Manufacturing (otherwise known as IOSM) as a way of boosting the sustainability of satellites and space objects.

In tandem with the Astra Carta, June 2023 also saw the launch of the Earth Space Sustainability Initiative (ESSI), which is funded by the UKSA. The motivation behind the ESSI is to bring together stakeholders from across the space industry to find ways of ensuring that the current generation’s use does not jeopardise the potential economic and scientific use of outer space by future generations. To do this, the ESSI intends to first develop a set of “Space Sustainability Principles”, which will eventually lead to a set of “Space Sustainability Standards” that can be used as a reference point by industry and government alike.

In terms of financial support for space sustainability, significant investment has also been provided by the UK government, through the UKSA, to NewSpace companies concerned with IOSM and the mitigation of space debris. Within Europe, the UK is a major investor in space debris clearance projects, including the ClearSpace-1 mission (the first mission to remove a derelict space object from orbit). In 2022, the UK government also announced that it was increasing investment to boost awareness of and thereby support the implementation of UNOOSA’s guidelines for the long-term sustainability of space (ie, Phase 3). 

Intellectual Property and Outer Space

There is no agreed legal system for the enforcement of intellectual property rights in outer space. It is, however, possible for UK companies and individuals to register intellectual property rights (including copyright, patents, design rights and trade marks) in the UK relating to space technology. Such rights can be registered with the Intellectual Property Office and would be enforceable within the UK and, in the case of copyright in particular, in foreign countries pursuant to the Berne Convention.

The UK does not currently have any legislation governing the ownership of space resources but has been a signatory to the Artemis Accords since 2020. As a signatory to that agreement, the UK has expressly recognised the potential benefits that may arise from the utilisation of space resources (Section 10(1) Artemis Accords) and has affirmed the view that the extraction of space resources does not constitute national appropriation of those resources for the purposes of Article II of the OST (Section 10(2) Artemis Accords). This suggests that the official view of the UK government is that UK citizens may lawfully exploit space resources, although the UK government has not so far provided a statutory basis allowing citizens to do so.

Nonetheless, the UK is home to several NewSpace companies whose ambition it is to undertake in situ exploitation of outer space resources. Perhaps in response to this, the UK government has recently identified that certainty in respect of in situ resource utilisation on the Moon is critically important for encouraging UK industry to invest in the developing lunar economy. In the Space Regulatory Review published by DSIT in May 2024, DSIT has proposed that the UK government can help to achieve this certainty by setting out domestic and international policy covering norms and acceptable behaviours relating to in situ resource utilisation. 

At present, the UK does not have any legislation governing the ownership of space resources either by the state or by private individuals or companies. Consequently, there is no granting authority for resource rights in outer space.

Environmental Protection on Earth

The UK’s legal framework contains environmental protection measures in relation to certain space activities (namely, launch and the operation of spaceports) on the Earth’s surface. Pursuant to Section 11(2) SIA, all applicants for launch operator or spaceport operator licences under the SIA must complete an “assessment of environmental effects” (AEE) before they can receive a licence. The CAA’s guidance for applicants about to undertake an AEE is set out in CAP 2215.

The AEE is intended to assist applicants for spaceport and launch licences, as well as the CAA, in identifying any environmental risks that may arise as a result of their intended activities (for example, following the launch of a spacecraft or the launch of a spacecraft from a carrier launched from the spaceport in question). By way of example, these are likely to include risks to air quality, emissions targets, biodiversity, water quality, and noise pollution. If any such risks are identified during the AEE, then the applicant must take steps to mitigate the potential effects of those risks, following which the CAA may determine whether to grant a licence, and whether to impose conditions on that licence. To avoid duplication, Section 11(4) SIA permits entities that have already carried out equivalent assessments to submit these to the CAA instead of a fresh AEE. Spaceport licence holders are also required by Regulation 158 SIR to designate appropriate areas at the spaceport where hazardous materials must be stored. Any hazardous material storage facility must also be clearly marked.

Depending on the terms of the licence, licence holders may also be required to continue monitoring certain environmental effects and to report on these to the CAA after the licence is granted. In CAP 2215, the CAA has stated its intention to ensure that all licences will contain a so-called material change provision; this will require all spaceport and launch licence holders to provide a revised AEE upon the occurrence of a material change in environmental conditions at the location in question.

Spaceport and launch licence applicants should also check whether they will need to obtain planning permission and/or other forms of environmental licences, such as marine and wildlife licences. The SITC Report (see 2.2 Legal System and Sources of Space Law and Regulation) noted that many in the industry believed the need to make multiple applications to various environmental agencies, often providing identical information, was a possible obstacle to the efficiency and attractiveness of the UK’s licensing regime.

Environmental Protection in Outer Space

The UK’s legal framework does not currently contain any measures for the protection of the environment either in space, on the lunar surface, or on the surface of any celestial body.

Dark and Quiet Skies

The increasing number of large satellite constellations poses a threat to the preservation of dark and quiet skies. The seriousness of this threat was expressly recognised by COPUOS at its 66th meeting in June 2023 and, in February 2024, during a meeting of the organisation’s scientific and technical subcommittee, it was agreed that the topic of “Dark and quiet skies, astronomy and large constellations: addressing emerging issues and challenges” would be added to the COPUOS agenda for all meetings from 2025 to 2029.

The growing prominence of this issue is particularly relevant to the UK. First, the UK is home to companies like Eutelsat OneWeb that own and operate sizeable satellite constellations. Any steps agreed upon by COPUOS to tackle the issues posed by such constellations will be relevant to these companies. Second, this issue threatens astronomical activities carried out in and organised from the UK. Since 2021 onwards, the UK is the global headquarters of the Square Kilometer Array Observatory, which is an intergovernmental radio telescope project. The UK therefore has a direct interest in preserving dark and quiet skies.

The UK’s legal framework does not currently contain any legislation governing climate change in relation to space activities.

The UK government does, however, recognise the important role that space may play in combating climate change on earth, particularly regarding Earth Observation (EO), and plays an active role in supporting the development of this area. As a member state of the ESA, the UK has been particularly active in Europe in supporting the TRUTHS climate and calibration satellite mission, which is designed to provide the most accurate climate data readings possible. Within the UK, the UKSA has invested substantial sums of money to assist NewSpace companies design and build new EO technology and, as part of the Space Industrial Plan, the UK government has identified this as a key growth area suitable for private investment. Most recently, the UKSA has provided funding of GBP15 million towards the manufacture of satellites and space-based instruments for the purpose of improving the collection of global climate data, and in the Space Industrial Plan the UK government also committed to opening a new EO data hub for the UK by no later than April 2025.

The UKSA is the chair of Space4Climate, a UK-based organisation that aims to bring together experts from industry, academia and the government to develop new space and satellite technology for the purpose of combating climate change. Space4Climate’s focus is again primarily on EO.

The UK has a modern and well-developed tax system which includes a range of tax incentives from which innovation-focused businesses, including those operating in the space sector, can benefit. These include reliefs for expenditure on qualifying research and development, a “patent box” regime under which a lower effective rate of corporation tax can be accessed for profits derived from exploitation of certain types of patents and IP rights, and a generous capital allowances regime, allowing up to 100% deductions against taxable profits for capital expenditure on qualifying plant and machinery. More generally, the UK offers a competitive tax regime for international investment, with no withholding taxes on dividends and a comprehensive range of double tax treaties and other exemptions, which in many cases allow withholding taxes on interest and royalties to be reduced or eliminated.

See 6.1 Tax System for Space Activities.

See 6.1 Tax System for Space Activities.

Development of NewSpace

As explained in 2.1 Characteristics of the Space Industry, NewSpace is a rapidly growing industry in the UK and its development has been recognised as a priority by the UK government.

Venture Capital

The UK has seen active investment from venture capital, with nine of the largest venture capital firms operating in the UK having invested in space since 2015. One of the world’s leading space venture capital funds, the Seraphim Space Group, is established in the UK and has raised over GBP250 million in investment to date. The Group’s first fund was launched in 2017, and its second fund (believed to be worth more than GBP70 million) was launched in April 2024. As well as venture capital, the Seraphim Space Group also operates its own accelerator for new space start-ups.

Private Funding

With many venture capital funds now active in the NewSpace industry in the UK, there are significant sources of private finance for companies that are seeking investment and who are willing to give up equity in their business in return. As noted in 7.1 Impact of “NewSpace”, the world’s leading space venture capital fund, the Seraphim Space Group, has been in active in the UK since 2017.

However, the UK government has identified that there is still a gap in the private funding available to companies in the UK NewSpace sector. It has stated that it is seeking to bridge that gap by helping potential investors to identify and gain access to investment opportunities within the industry. In particular, the UKSA has launched a programme called “Unlocking Space for Investment” that is dedicated to helping facilitate investment in Series A and B opportunities. The programme is open both to would-be investors (the “Investor Pathway8”) and to NewSpace sector businesses (the “Business Pathway”). Additionally, in the Space Industrial Plan, DSIT has proposed the creation of a new private investment framework for space, which would be used by the UK government to assess which areas of the NewSpace industry are suitable for and in need of investment, and to then help direct investment towards those areas.

Public Funding

Public funding remains an important source of finance for NewSpace in the UK. This was expressly recognised by the SITC Report, which identified that the provision of public funding is vital to the successful development of the UK’s launch facilities. To date, the UKSA has provided over GBP30 million in funding to support the development of two of the largest of the UK’s new spaceports: Spaceport Cornwall and Sutherland Spaceport.

Besides launch facilities, the UKSA also uses public funding to promote the successful development of “space clusters” in key strategic areas (see 2.1 Characteristics of the Space Industry).

The flagship source of public funding for the UK’s space clusters is the UKSA’s Space Clusters Infrastructure Fund (SCIF). In November 2023, the SCIF announced that it was providing GBP47 million in grants, which would be matched by private funding, to companies located at clusters across the UK. The UK government’s commitment to the development of space clusters, and to providing them with public financing, was also re-confirmed in the Space Industrial Plan. In the Plan, the UK government stated its intention to prioritise support for the most focused clusters and to create a united nationwide network that would facilitate effective collaboration between the clusters.

As noted in 7.2 Finance Sources for Space Activities, the UK government has launched the “Unlocking Space for Investment” programme and is planning to implement a new private investment framework for the space industry. Both initiatives are designed to attract investment in space activities in the UK.

The UK is home to several catapult and accelerator programmes that are aimed at assisting NewSpace start-ups in establishing their businesses, and which may in turn provide attractive investment opportunities for investors. In the private sector, the Seraphim Space Group has established a successful accelerator that is focused specifically upon space technology start-ups located in the UK and which supports between 16–20 new businesses a year. In the public sector, the UK Space Agency Accelerator operates to help NewSpace start-ups at various stages of their journey and recently awarded GBP500,000 in funding to support new space enterprises.

More broadly, the UK government is intending to create an attractive environment for investment by ensuring that its regulatory regime is as streamlined as possible, while also providing certainty and clarity for would-be investors. This includes space sustainability, which the UK government intends to incentivise, and the ownership and exploitation of space resources. The UK government has recently concluded its review of the UK’s regulatory landscape, as part of which it has considered how the regime created by the SIA 2018 can be fine-tuned, and is currently working on an implementation plan that will be designed to deliver improvements in this area.

In the UK, certain types of transaction relating to certain strategic sectors are governed by the National Security and Investment Act 2021 (NSIA 2021). The transactions covered by the NSIA include larger scale transactions like mergers and acquisitions, but also smaller scale transactions including minority investments, the acquisition of voting rights and operational control over companies, as well as the acquisition of certain types of assets. The sectors covered by the NSIA 2021 are identified by the accompanying National Security and Investment Act 2021 (Notifiable Acquisition) (Specification of Qualifying Entities) Regulations 2021 (NSIR 2021).

Schedule 14 NSIR 2021 identifies satellite and space technology, which it defines very broadly, as one of the key sectors falling within the scope of the NSIA 2021. This means that investments in companies involved in the space industry in the UK may need to be notified to the Investment Security Unit (ISU), which is an operational unit within the Cabinet Office. If the investment will result in the acquisition of more than 25%, 50% or 75% of the voting rights or shares in the target entity, or will result in the acquiring entity becoming able to pass or block any class of resolution, then a mandatory notification to the ISU will be required. If the transaction involves a smaller percentage or shares but may still result in the acquiring entity gaining “material influence” over the target, then the company may make a voluntary notification. The same applies if the transaction relates to the acquisition of control or direction over an asset. In the case of a voluntary notification, the ISU may determine whether it is necessary to call in the transaction for a more detailed national security assessment.

For the NSIA 2021 regime to apply, there must be a factor that connects the transaction to the UK. This means that either the target asset or the entity must be sufficiently closely connected to the UK. This in turn requires that the entity must carry on activities within the UK or supply goods or services to people in the UK; similarly, a target asset must be used in connection with any such activities carried out in the UK. In practical terms, all NewSpace companies established and active in the UK will fall within the geographical scope of the NSIA 2021 regime.

The UK securities markets play an important role in financing activities in the growing NewSpace sector.

As with participants in other sectors, NewSpace companies can utilise the UK’s established securities markets to raise significant and necessary capital from new institutional and retail investors to fund research and development, manufacturing, and operational expansion.

In the UK, the two largest equity markets are the Main Market of the London Stock Exchange and the Alternative Investment Market (AIM). Each market serves different types of companies and has a distinct regulatory environment. The Main Market is suited to larger, more established companies, generally with significant revenues and more demonstrated financial histories. Entities wishing to list on the Main Market are subject to more stringent regulatory and governance requirements. There is a diverse investor base comprising various large institutional investors and funds. In comparison, AIM is designed for smaller, high-growth companies, often in emerging markets such as NewSpace. Its regulatory regime is tailored for smaller companies. Whilst retaining an institutional investor base, AIM often attracts venture capital and other high net worth individual investors.

Both the LSE and AIM provide opportunities for NewSpace companies to go public through an IPO and, once listed, access additional capital through secondary offerings to new and existing investors. This ongoing access to capital is crucial for NewSpace companies that require substantial investment for development and scaling. An example of this is the GBP178.4 million IPO of Seraphim Space Investment Trust plc on the Main Market of the LSE in 2021.