The Commercial Space Act of 1998

The Commercial Space Act resolved the con­fusion. It also specifically approved the development and use of commercial reusable launch vehicles (RLVs) for launch and landing within the United States. In addition, the fledg­ling commercial space launch effort received a significant boost by the law directing NASA to use commercial launch services “when required in the course of its activities” and to “plan mis­sions to accommodate U. S. commercial provid­ers.” The statute prohibited the government from using any missile that was formerly used by the Department of Defense for national defense pur­poses as a space transportation vehicle, which effectively took the government out of the sat­ellite launch business. The statute did provide for seven exceptions to be used in the case of national defense overrides.

The Commercial Space Launch Amendments Act of 2004 (CSLAA)

This legislation was passed by Congress in December 2004. The law is “designed to promote the development of the emerging commercial human space flight industry” and creates the struc­ture for the regulation of private space activities. It also frees the fledgling industry from the patch­work of regulations that had been applied to it.

Its overriding premise is that the federal government should not “over regulate” this new industry for fear that, in so doing, it will stifle the innovation necessary to make the concept succeed. Those now in the forefront of experi­mentation are compared to the early pioneers in aeronautical flight at the beginning of the last century. These current pioneers need a regulatory environment that will allow them room to experi­ment and take chances as they develop the space concepts of the future.

The government has decided that regulation will not be the enemy of innovation. Remember­ing the early days of aviation presented earlier in this book, we saw that the first regulation of aviation by the federal government occurred in 1926, some 23 years after the Wright brothers’ first flight. As with the development of law after the first Sputnik orbited earth, it was clear that law must follow, not lead, technology. Just as government oversight of aviation safety gradu­ally developed as aviation itself developed, so too will government oversight of the commercial space industry evolve.

According to statements made by FAA rep­resentatives to Congress, the government is plac­ing its oversight emphasis on the protection of the public, not the participants. Given the experience of the industry regarding the failure rate of expend­able launch vehicles, which is about 10 percent of all attempts, it is recognized that space launches are a relatively dangerous activity. FAA efforts are directed, therefore, not to the over-protection of those who voluntarily place themselves in harm’s way as a part of the industry itself, but to the bystanders of the process, the public. In this regard the oversight process employed by the FAA has been successful. There have been no deaths or seri­ous injuries, nor any significant property losses, as a result of FAA-monitored commercial launch activity.

It may be expected, however, that once com­mercial launch activity is removed from federal launch sites, with their isolated locations and ranges, and with their strict safety regulations and controls, there may be greater likelihood of harm to the general public. The regulatory regi­men of CSLAA provides for launch operators to maintain an under-layer of liability insurance, but also requires the federal government to indem­nify or reimburse operators for losses to third parties in excess of that insurance up to the sum of $1.5 billion. The removal of this financial risk is important to private investment.