As the commercialization of outer space continues to make the news—from reusable rockets to private rovers headed to the Moon—one name is increasingly in the limelight. No, it is not Elon Musk or Jeff Bezos, nor SpaceX or NASA, but Luxembourg. The small European nation is betting big on outer space, and is now working with entrepreneurs from Silicon Valley. What is Luxembourg doing to work with commercial space companies, and what are there lessons that the United States could learn?
Most recently, Luxembourg’s satellite operator, SES, became the first company to purchase a satellite launch on one of the previously used Space Exploration Technology (SpaceX) rockets. While SpaceX has been landing its launch rockets for use later for a while now, this will be the first time a used rocket is reused by a customer. This is par for the course for Luxembourg. In fact, SES itself is a byproduct of the country’s early investments back in 1985, long before the satellite industry’s viability was certain.
Aside from their groundbreaking agreement with SpaceX, Luxembourg has also set up a $200 million fund to attract companies that want to mine asteroids. Not only that, but it has begun to work on a legal framework that would allow companies based in Luxembourg to own the rights to space resources they harvest. The work that Luxembourg is doing on space mining expands on partnerships the country has with with two American companies: Planetary Resources and Deep Space Industries. While the United States signed into law an act that gave companies rights to the resources they harvest in space last November, Luxembourg is the first European country to express its willingness to do so.
But what does this have to do with American space policy?
Luxembourg’s previous investments in outer space have already paid off. In 2015, SES had a revenue of 2 billion euros. Add to that the country’s decision to create a legal framework for space mining and the future of commercial space looks like it could be very competitive. Unless the United Nations takes another look at international space law, countries will likely set the resource rights their countries have in space. The countries with the most investment-friendly rules will attract businesses. That means America, whatever its current lead in the industry, could face difficult market pressure in the near future.
National space regulation, like tax regulation, may then determine where innovative commercial space companies locate themselves. This may become an issue for the United States, where the number of agencies involved in space policy and the complexity of the regulatory system may make the country less competitive than smaller, more nimble regulatory systems. Foreign space companies already pitch themselves to customers as easier to work with than American companies entangled by U.S. laws. This may increase if foreign regulations surrounding space property rights and/or taxation on income are less burdensome than American regulations.
For now, there are still uncertainties about how the U.S. space mining law will hold up under international space law and international pushback and Luxembourg has not yet worked out its own system. But if the ability for countries to set their own space property rights holds, the world may see the rise of competition among states to attract investment and commercial space companies. If that happens, the United States is going to have to move quicker at sorting out problems in its complex space regulatory system. The United States is currently the place to be to pursue commercial use of outer space, but that may not always be the case.