In this boundless expanse of space, India’s ambition to a be a germane player in the space race is soaring to unprecedented heights - the stars do not look bigger but do look brighter.  As India prepares to embark further on its ventures beyond Earth, to make the commercial space sector more inclusive, the Indian National Space Promotion and Authorization Centre (“IN-SPACe”) has finally unveiled the framework for authorization of space activities to govern such endeavors responsibly, which is a small step for India, albeit a giant leap for the Indian space industry, as we know it. The Norms, Guidelines, and Procedures for the Implementation of the Indian Space Policy-2023 in respect of Authorization of Space Activities (“Notified Guidelines”) signify a progressive stride towards ensuring transparency in regulation of space activities in India. Among the vast array of directives and compliances outlined, the Notified Guidelines also delves deeper into liability-related aspects of space activities, delineating the intricate web of responsibilities while addressing risks inherent and apparent in indulging in space activities.

Before delving into the intricacies of liability in space activities, it's crucial to understand the authorization framework as outlined in the Notified Guidelines, which stipulate that any entity, whether the government or non-government entities (now known as “NGE(s)” popularly), conducting space activities within Indian territory or under its jurisdiction, must obtain authorization from IN-SPACe. In addition to Indian entities, foreign entities too can apply for authorization to conduct space activities under the Notified Guidelines, albeit through its Indian subsidiary, joint venture or any other collaboration arrangement recognized by the Indian Government. That said, the authorized representative/dealer of non-Indian entities can also seek IN-SPACe Authorization for certain category of authorizations such as authorization of non-Indian GSO (Geo-Stationary Orbit) and/or NGSO (Non Geo-Stationary Orbit) satellite/constellation to enable provisioning of its capacity in India for communication services, Dissemination of space-based earth observation/Remote Sensing data, et al.

The Notified Guidelines are far reaching and touch upon all activities related to the space sector. Any space activity, as outlined in the Indian Space Policy-2023 and beyond, will need an authorization from IN-SPACe.

It was expected that IN-SPACe would introduce the Notified Guidelines, considering the recent revision to foreign direct investment (FDI) norms for the commercial space sector earlier this year. Easing of FDI norms will enable Indian space startups working on high value space deep technology products to access capital to expand manufacturing and production capacity, and consequently, making the space sector attractive to foreign investors. Increased engagement of foreign investors is contingent upon transparency in procedures, whilst maintaining accountability and ensuring that such entities act in a responsible manner.

International Treaties

India is a signatory to several international treaties pertaining to space, including the Outer Space Treaty (1967), the Rescue Agreement (1968), the Liability Convention (1972), the Registration Convention (1976), the Moon Agreement (1979), and the Artemis Accords (2023).

Space activities are universally acknowledged as highly perilous endeavors due to their intrinsic dangers, which includes the risks associated with spacecraft leaving Earth's atmosphere, as well as the payloads they transport, whether human or otherwise. Furthermore, space activities also pose environmental hazards in outer space that can potentially affect Earth, as objects launched into space sometimes can return to earth atmosphere as debris causing damage on ground.

The foundation of liability governance for India in space activities rests upon international treaties and conventions to which India is a signatory. Two of the most crucial are the Outer Space Treaty of 1967 and the Liability Convention of 1972 (“Conventions”). Article VII of the Outer Space Treaty states “Each State Party to the Treaty that launches or procures the launching of an object into outer space, including the moon and other celestial bodies, and each State Party from whose territory or facility an object is launched, is internationally liable for damage to another State Party to the Treaty or to its natural or juridical persons by such object or its component parts on the Earth, in air or in outer space, including the moon and other celestial bodies.”[1] While the Convention states under Article II that “A launching State shall be absolutely liable to pay compensation for damage caused by its space object on the surface of the earth or to aircraft flight” and defines a launching state as “each State Party to the Treaty that launches or procures the launching of an object into outer space.” Consequently, a Launching State may incur unlimited liability for third-party damages resulting from space activities, irrespective of whether such endeavors are undertaken by governmental entities or non-governmental entities (NGEs).

Several prominent spacefaring nations have implemented measures to mitigate the liability exposure of private entities concerning third parties, chiefly through stipulating specific insurance requirements. For example, in the United States, the Commercial Space Launch Act of 1984[2] states “Each person who launches a launch vehicle or operates a launch site under a license issued or transferred under this Act shall have in effect liability insurance at least in such amount as is considered by the Secretary of Transport to be necessary for such launch or operation, considering the international obligations of the United States. The Secretary shall prescribe such amount after consultation with the Attorney General and other appropriate agencies” pursuant to which private entities undertaking space endeavors must secure insurance or demonstrate financial responsibility of coverage of at least US$ 500 million as per the 51 U.S. Code § 50914 - Liability insurance and financial responsibility requirements [3].

India’s previous attempts to regulate liability related aspects of space operations.

Previous attempts of the Indian Government to regulate space activities included Space Activities Bill, 2017[4] and the draft Space Based Communications Policy, 2020, which made private entities solely liable for any damage caused due to their space operations. As one might expect, this did not generate significant enthusiasm within the Indian space industry, as it could potentially burden start-ups unduly, discouraging them from pursuing additional space operations.

India’s take on Liability related to Space Activities.

Owing to our obligations to international treaties and the apparent risks, the Notified Guidelines extensively address the third-party liabilities arising out of potential damages due to space activities undertaken to ensure risk mitigation and accountability under Chapter X of the Notified Guidelines titled – “Liability-Related Aspects”. Some quick takeaways for us to ponder over, are as follows:

1. It mandates the launch operators to procure adequate third-party liability insurance which shall cover the damages caused by launch vehicle and/or any of its payloads onboard, to cover the potential damages throughout all phases of a launch, including sub-orbital and orbital phases, as well as the re-entry of spent rocket components. However, IN-SPACe itself will specify, at its discretion, the minimum insurance amount, with the insurance amount capped, insurance period, and other terms and conditions of the insurance. IN-SPACe may also permit standard exclusions that are normally practiced worldwide by the insurers.

Until a decade ago, the insurance afforded did not cover much beyond manufacturing issues, replacement, and other such operational risks. Space tourism and sub-orbital launches were considered too risky a business, and the space race undertaken by the affluent, were in likelihood, launches without liability insurance. Whereas today, a whole constantly evolving suite of space insurance products are available for pre-launch, launch, in-orbit, and liability coverage for spacecraft and launch vehicles.

2. The insurance policy must include the Indian Government, the launch operator, and the customer with whom the launch operator has entered into the agreement for launching their space objects, as insured parties.

Considering the unlimited liability of the State due to the Conventions, it is naturally sought to be included in the insurance policy, as per its standing instructions issued through the Notified Guidelines. IN-SPACe also reserves the right to review and scrutinize any such policies. However, the insurance is expected to cover all damage to all the government properties and its employees except for the exclusions, if any, mandated by the insurers in respect of the government launch base and employees involved in the launch activities being undertaken as per global standard practice

3. The Notified Guidelines provides for a higher threshold of compliance for launches involving Space Objects of non-Indian Entities. The launch service agreement or contract between the Launch Operator and the non-Indian Entity must contain clauses transferring third-party liability and responsibility for registration of the Space Objects to the respective non-Indian Entity.

Furthermore, for launches conducted outside Indian territory, third-party liability is addressed in accordance with the Outer Space Treaty and Liability Convention. The responsible nation or government from whose territory the launch occurs must engage in appropriate mechanisms, such as agreements or contracts, to address these liabilities.

4. It also stipulates that in cases of re-entry attempts by Indian Entities, IN-SPACe may determine the necessity of maintaining third-party liability insurance on a case-by-case basis during the authorization process.

The Notified Guidelines are set to manage risks effectively and ensure compliance with the Conventions, reflecting a structured approach to managing the complexities of liability in space activities. It is important for all stakeholders to understand that adherence to these norms is crucial as any failure to comply could lead to suspension/termination, which will be determined by IN-SPACe, at its discretion. In cases where IN-SPACe's investigation uncovers willful misconduct or gross negligence resulting in third-party liability, the applicant becomes accountable to IN-SPACe and/or the Indian Government for damages, whether direct or indirect, arising from such actions.

While there are some challenges such as the absence of detailed risk assessment criteria and ambiguity surrounding insurance caps, it is important to recognize the significant progress achieved through the release of the Notified Guidelines. These guidelines represent a commendable step towards ensuring comprehensive governance of liability in the space sector. As India's space industry experiences increased participation from the private sector, the effective management of liability becomes increasingly crucial.

The journey towards responsible and sustainable space exploration depends heavily on a regulatory framework that adapts to the evolving technological landscape and international standards. IN-SPACe's dedication to regular updates and alignment with global best practices will underscores India's steadfast commitment to shaping a vibrant and promising space ecosystem and as India embarks on this transformative journey, the meticulous management of liability will serve as a guiding light, steering the nation towards the frontiers of the cosmos and beyond.

At the India Space Congress 2024 organized by SIA-India and to be held from 26^th – 28^th June 2024 at The Lalit, New Delhi a comprehensive discussion will be held on the topic of space policies and authorization. The session will address the intricacies associated with the Norms, Guidelines and Procedures and the India Space Policy 2023 as they are set to provide conducive business environment to national and international players in India.

[1] https://www.unoosa.org/oosa/en/ourwork/spacelaw/treaties/outerspacetreaty.html

[2]https://www.congress.gov/bill/98th-congress/house-bill/3942/text ; https://www.faa.gov/about/office_org/headquarters_offices/ast/licenses_permits/media/14cfr-440.pdf

[3]https://www.govinfo.gov/content/pkg/USCODE-2010-title51/pdf/USCODE-2010-title51-subtitleV-chap509-sec50914.pdf

[4]  THE SPACE ACTIVITIES BILL, 2017, draft_space_activities_bill201710.pdf (isro.gov.in)