Insight - Regulatory Reform is Not a One-off Event

Friday, May 4, 2018

By Ian Christensen, Director of Private Sector Programs

Each year a large portion of the international civil, commercial, and military space sector gathers for the annual Space Symposium in Colorado Springs, Colorado. U.S. Vice President Mike Pence kicked off this year's event with an address highlighting a number of key space-related policy and regulatory reform efforts currently being undertaken within the U.S. government. Vice President Pence’s appearance at the Symposium was emblematic of the continued importance being placed on modernizing the regulatory framework to enable commercial space development in the U.S. and of the relevance of that effort to the international community.

Speaking at the Symposium on the day after the Vice President, U.S. Secretary of Commerce Wilbur Ross characterized the current situation as “a period of great convergence.” He described this as a ”convergence of technology, convergence of capital, and convergence of political will.” Secretary Ross’s remarks also provided greater detail on efforts underway within the Executive Branch of the U.S government, under the auspices of the recently re-established National Space Council, to reform and adapt the space-related regulatory framework in the United States to be more responsive and effective in response to ongoing innovation within the private sector and to existing perceived shortcomings in the regulatory structure.

The political will that Secretary Ross mentions refers to both an ongoing area of emphasis within the Trump administration and to related legislative initiatives within Congress. Building and expanding upon work begun under the Obama administration, the National Space Council has promulgated a series of recommendations to the President on measures to reform the U.S. regulatory framework for commercial space. As highlighted in Secretary Ross’s remarks, these efforts include:

• Re-invorigating and elevating the Office of Space Commerce within the Department of Commerce and consolidating most commercial space-related approval processes within that office; with the exception of existing spectrum oversight and launch and re-entry licensing responsibilities at the Federal Communications Commission (FCC) and Federal Aviation Administration's Office of Commercial Space Transportation (FAA/AST), respectively. This aims to create about as close to a “one-stop shop” as possible for space commerce within the U.S. government.
• Establishing a “mission authorization” process, with default presumed approval, for non-traditional commercial space applications and services (e.g. those not remote sensing, communications, or launch). The mission authorization concept was originally developed during the Obama administration. The current proposal would implement it under Commerce rather than FAA/AST as previously envisioned.
• Increasing efficiency in the existing remote sensing licensing approval process.
• Initiating a new policy review of export control restriction affecting the U.S. commercial space industry, which takes advantages of the major reforms to space export controls enacted under the Obama administration.
• Establishing the Department of Commerce as the “civil agency tasked with leading Space Traffic Management (STM) and Space Situational Awareness (SSA).”

On April 24, 2018, the U.S. House of Representatives unanimously passed the American Space Commerce Free Enterprise Act, which had been under development and consideration since early 2017. This legislation also implements a number of the reform initiatives being applied through the National Space Council and Executive Branch, including: placement of authorization and supervision responsibilities for nontraditional commercial space application within the Department of Commerce; reform of remote sensing licensing; and initiation of a presumptive approval permitting approach. Importantly, however, the Act does not address STM or SSA approaches or authorities. The Senate has also yet to introduce their own version of this legislation, which would be required for the changes to become law. It is unclear what action the Senate will take on the Act, including if it might adopt a different approach.

As these regulatory reform efforts have been considered and developed, SWF has engaged in a number of complementary and contributing activities. In May 2014, SWF Director of Program Planning Dr. Brian Weeden testified before the House Subcommittee on Space in a hearing on STM. In March and May of 2017, SWF staff submitted letters providing input to Senate and House committee hearings, respectively, related to commercial space oversight. We also contributed written material to the House Committee on Science, Space, and Technology during the drafting of the American Space Commerce Free Enterprise Act. Throughout 2017 and 2018, SWF has a facilitated an ongoing dialogue, including most recently at the Space Symposium, on how various elements of the space community can develop and implement principles for responsible behavior in space and how those principles might be complementary to an evolving regulatory framework. We also continue to support discussion of policy, legal, and industry standards frameworks for commercial space applications and enabling services through forums such as the Advanced Maui Optical and Space Surveillance Technologies (AMOS) Conference Policy Dialogue, the Hague International Space Resources Governance Working Group, and The Consortium for Execution of Rendezvous and Servicing Operations (CONFERS).

As regulatory reform continues, SWF believes several elements will require further attention. Many of the authorities and functions which are proposed to be transferred or consolidated under the Department of Commerce have previously been evaluated and researched under FAA/AST or other agencies during the Obama administration. This includes both the concept of mission authorization and consideration of civil approaches to SSA and STM. If proposals to establish these activities under Commerce move forward, it is of key importance that knowledge and human capital developed previously not be lost. Accordingly, robust communications and information sharing channels between Commerce, the FCC, and FAA/AST must be established and maintained.

It is also important to consider effective resourcing of the new processes and offices being established. The American Space Commerce Free Enterprise Act is not an appropriations bill, and while it suggests funding levels, subsequent Congressional and Executive action will be required to provide sufficient funding. The efficiency of FAA/AST in processing launch licensing applications has been hampered by a lack of personnel resources - and the risk exists that new authorities within Commerce for mission authorization and STM might also be so hampered. The American Space Commerce Free Enterprise Act authorizes up to $5 million annually in Fiscal Years (FY) 2018 and 2019 in funding for the Office of Space Commerce within the Department of Commerce, which is currently staffed with 8 full-time government employees.  By contrast, an FAA reauthorization bill passed by the House in April 2018 would authorize $33 million in funding for FAA/AST in FY2019, an increase from the FY2018 authorization of $22.6 million. FAA/AST typically has around 100 full-time government employees. It is not sufficient to simply establish new authorities: those authorities must also be provided with sufficient human and financial capital.

Where efforts related to commercial space regulation intersect or overlap with other areas of U.S. government policy, effective coordination will be required. One such example is in the area of export control. As the Department of Commerce initiates a new review of improving export control restrictions for the commercial space sector; the U.S. Congress is considering legislation to reform export controls. Although not specifically focused on space, the legislation proposes wide-reaching new controls on technology that might significantly increase certain elements of export controls affecting all industries. This lack of coordination might ultimately increase uncertainty for commercial space ventures.  

Lastly it is important that, as regulatory reforms are implemented, the U.S government continues its activities in communicating the purposes of these reforms to the international community. Many other countries are also considering and implementing policy and regulatory reforms to support commercial space, so open sharing and discussion of the principles and objectives of these policies will help to support a competition environment that enables innovation and new benefits. To this end, Secretary Ross’s proposal to “convene an international space regulatory conference in the U.S. no later than January 2019 to discuss STM coordination with private industry” is an important step.

Regulatory reform is not a one-off event. Ongoing attention to these issues from the National Space Council, Congress, and industry will be necessary to provide an effective regulatory framework that is capable of evolving in light of continuing market, technical and business innovation in the commercial space sector.