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Businessweek
Businessweek
Business
Bruce Einhorn

More Companies Head to Space, But No One Can Agree on the Rules Up There

As Elon Musk’s SpaceX and others send thousands of satellites into orbit, growing numbers of companies are contemplating the vastly more complex task of landing on the moon. A spacecraft from Israel Aerospace Industries and the nonprofit SpaceIL crashed on the surface in 2019, and a lander from Japan’s Ispace Inc. suffered a similar fate in April. Later this year, two American companies, Astrobotic Technology Inc. of Pittsburgh and Intuitive Machines Inc. of Houston, each aim to give it a go.

Such private moon missions herald a new era of space activity, with various companies laying plans for what has long been the stuff of science fiction—growing crops in lunar greenhouses, mapping terrain with drones or extracting minerals from moondust. “We need strong commercial players” going to the moon, says Jonathan Geifman, chief executive officer of Helios Project Ltd., an Israeli startup that has signed up for a scheduled Ispace lunar landing in 2025 to test technology designed to produce oxygen and metals on the moon. “This is the beginning of a very long road.”

That prospect has many in the space community asking a fundamental question: Who sets the rules? The major spacefaring countries have yet to agree on the basics of regulating the commercialization of the moon’s resources. In the 1960s almost 100 nations agreed to the Outer Space Treaty, designed to prevent countries from making territorial claims or using celestial bodies for military purposes. The treaty declares that space should be used “for the benefit and in the interests of all countries,” but it makes just a brief mention of “non-governmental entities.” In 1979 the UN-brokered Moon Agreement went into more detail, but only 18 countries—none with extensive experience in space—embraced it.

A few governments have enacted legislation that addresses the exploitation of extraterrestrial bodies. Ispace, for instance, got a license to conduct commercial activity on the moon under a Japanese law similar to a measure signed by President Barack Obama in 2015 to promote the exploration and exploitation of the heavens by US companies. In 2020, President Donald Trump signed an executive order calling on the US to “take all appropriate actions to encourage international support for the public and private recovery and use of resources in outer space.” Luxembourg and the United Arab Emirates have enacted similar laws, as both aim to become hubs for the emerging space economy.

Many governments and legal experts oppose these moves, arguing that nations should cooperate on crafting lunar rules rather than legislating them on their own. “Making laws about the moon and about other celestial bodies from a country’s perspective is simply not possible, because it is not national territory,” says Stephan Hobe, a space law professor at the University of Cologne in Germany. “One must be very clear this is illegal.”

The risk of uncertainty will grow as national space agencies and private companies push ahead with ambitious moon projects such as bases for long-term human habitation. NASA is planning Artemis II, which is expected to orbit the moon sometime in 2024, setting the stage for a mission as early as the following year to return people to the lunar surface for the first time since 1972. China, the European Space Agency, India, Japan, Russia and the UAE are also working on projects.

Japanese billionaire Yusaku Maezawa is scheduled to lead a crew of artists and athletes hoping to orbit the moon this year aboard one of SpaceX’s new Starship rockets, though that is likely to be delayed after one of the spacecraft exploded on April 20. “There’s a heap of new missions, so we’re really looking at a new era of how our conceptions of the moon are going to change,” says Alice Gorman, a professor at Australia’s Flinders University and vice chair of the Moon Village Association, a nonprofit focused on sustainable use of the moon.

Two dozen countries support the Artemis Accords, a US-backed initiative to establish guidelines for commercial activity in space, but China and Russia have called the pact a backdoor way for the US to claim lunar territory. They’ve pushed a rival initiative to establish an international research station on the moon, but so far they’re the only signatories. Steven Freeland, vice chair of a UN group working on the issue, says a consensus on the use of space is possible, but the 100-plus members will require several years to reach an agreement. “Countries understand that this is in their interest,” says Freeland, who helps lead an annual round of talks on space resources. “Whatever rules we put in place will have to last 30, 40, 50 years.”

Businesses aren’t waiting. If either of the American attempts succeeds where Ispace and the Israelis failed, demand for rides aboard spacecraft will likely accelerate. That will spur businesses looking for a legal foundation for activities in space to go “forum shopping,” by moving to places with favorable domestic legislation, says Rossana Deplano, a professor at Leicester Law School in England. “Before companies reach outer space to mine resources—or any other activity—they will need authorization from a state,” she says. “These companies will pick and choose the jurisdiction that is most convenient.”

©2023 Bloomberg L.P.

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