Op-ed | Regulatory reform is not a one-off event

The American Space Commerce Free Enterprise Act takes a number of important steps to provide regulatory certainty for emerging commercial space applications; and to implement the United States’ international obligation to provide authorization and supervision for its private sector actors.
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            This op-ed originally appeared in the June 4, 2018 issue of SpaceNews magazine.
Speaking at this year’s Space Symposium, U.S. Secretary of Commerce Wilbur Ross described current U.S. space sector dynamics as a period of ”convergence of technology, convergence of capital, and convergence of political will.”
The political will includes both an ongoing area of emphasis within the Trump administration and to related legislative initiatives within Congress.
The U.S. space sector is witnessing a “convergence of technology, convergence of capital, and convergence of political will.”Wilbur Ross, U.S. Secretary of Commerce.Credit: Tom Kimmell for SpaceNews
Building and expanding upon work begun under the Obama administration, the National Space Council has promulgated a series of recommendations to modernize the regulatory framework in the United States to be more responsive and effective in response to ongoing private sector innovation.
These efforts include:

Re-invigorating space-related functions within the Department of Commerce and consolidating most commercial space-related approval processes within a single administration in the Office of the Secretary of Commerce; with the exception of existing spectrum oversight and launch and re-entry licensing responsibilities at the Federal Communications Commission (FCC) and the Federal Aviation Administration’s Office of Commercial Space Transportation (FAA/AST), respectively.
Establishing a “mission authorization” process, with default presumed approval, for non-traditional commercial space applications and services.
Increasing the efficiency and speed of the existing remote-sensing licensing process.
Initiating a new policy review of export-control restrictions affecting the U.S. commercial space industry.
Establishing the Department of Commerce as the “civil agency tasked with leading Space Traffic Management (STM) and Space Situational Awareness (SSA).”

Many of these recommendations (but not the one pertaining to STM) have been formalized under Space Policy Directive 2, signed by President Trump on May 24, 2018.
On April 24, 2018, the House of Representatives passed the American Space Commerce Free Enterprise Act, which had been under development since early 2017. This legislation implements some of the reform initiatives being applied through the executive branch, including placement of oversight responsibilities for nontraditional commercial space applications within the Department of Commerce; reform of remote-sensing licensing; and initiation of a presumptive approval permitting approach. Importantly, however, it does not address STM or SSA approaches or authorities. The Senate has yet to introduce their own version of this legislation and it is unclear what action the Senate will take, including if it might adopt a different approach.
The American Space Commerce Free Enterprise Act takes a number of important steps to provide regulatory certainty for emerging commercial space applications; and to implement the United States’ international obligation to provide authorization and supervision for its private sector actors. In so doing, it aims to create an as ‘light touch’ as possible regulatory framework. In some areas — for instance, restricting what U.S. international obligations can be considered and leaving it up to the companies to attest they are fulfilling those obligations — this may be too light. It is important to clearly communicate the intent of these legislative measures, and to be willing to review and adjust their implementation.
As regulatory reform continues, we believe 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 elsewhere within the Department of Transportation 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 so that all three can continue to coordinate oversight of commercial space activities.
More detail is also needed on how Commerce will carry out its new responsibility for the civil SSA and STM mission. Again, this was an issue that was examined and debated for several years during the Obama administration, with congressional hearings and studies done by the Science and Technology Policy Institute on the cost, policy, and operational implications of various options for implementation and by the Science Applications International Corporation on balancing safety, national security, and economic interests. Those studies supported shifting the authority to provide those services to a civil agency, but also highlighted the challenges of continuing to rely on the Department of Defense (DoD) for the underlying data and software. The DoD has been struggling for more than a decade to upgrade its software, with billions of dollars spent in the process and few signs of improvement. However, it appears the Trump administration intends to continue relying on DoD data, instead of pursuing the alternative approach of using commercial and international data. This is likely to hamstring the ability of Commerce to improve the SSA and STM services it can provide and adapt to the rapid increase in commercial space traffic likely to emerge over the next several years.
As the U.S. Commerce Department initiates another review of space export-control restrictions, Congress is considering legislation to reform export controls. Credit: Flickr • John Sonderman
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 for these new authorities. FAA/AST’s efficiency in handling launch licensing applications has been hampered by a lack of personnel resources, despite having an annual budget of around $20 million and around 100 full-time equivalent employees. In comparison, the American Space Commerce Free Enterprise Act authorizes up to $5 million annually in Fiscal Years 2018 and 2019 in funding for the Department of Commerce, which is currently staffed with 8 full-time government employees, to provide oversight of all the new commercial space activities. Funding for civil SSA and STM activities is not addressed. Simply establishing new authorities is not enough: those authorities must also be provided with sufficient human and financial capital if they are to be successfully executed.
Where efforts related to commercial space regulation intersect or overlap with other areas of U.S. government policy, effective coordination between the executive and legislative branches will be required. The area of export control is one such example. The Obama administration worked with Congress to make a major overhaul of the export control regime for space that gave the executive branch more authority over controls on specific categories of space technologies. As the Department of Commerce initiates another review of space export-control restrictions, Congress is considering legislation (the Export Control Reform Act of 2018 and the Foreign Investment Risk Review Modernization Act) 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 increase uncertainty for commercial space ventures.
Lastly it is important that, as regulatory reforms are implemented, the U.S. government continues to communicate 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: open sharing and discussion of the principles and objectives of these policies will help 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 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 innovation in the commercial space sector.

Ian Christensen is the director of private sector programs at Secure World Foundation. Brian Weeden is the foundation’s director of program planning. This commentary was adapted from an essay first published in Secure World Foundation’s monthly newsletter.
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