How Might Space Policy Directive 2 Affect Commercial Space?

On Thursday, May 24, 2018, President Trump signed a second space policy directive. This directive, informed by the work of the National Space Council, intends to streamline regulations in the commercial use of space.

What does Space Policy Directive 2 say?

Space Policy Directive 2 directs several government agencies and the National Space Council to establish or reevaluate rules and regulations affecting commercial use of space.

The Department of Transportation (DoT) is required to develop a new system for licensing launch and reentry activities, no later than February 1, 2019. DoT must also consider both adopting a single license system for all commercial launch and reentry operations and replacing prescriptive requirements for commercial launch and reentry licensing process with performance-based criteria;

1. The Department of Transportation (DoT) is required to develop a new system for licensing launch and reentry activities, no later than February 1, 2019. DoT must also consider both adopting a single license system for all commercial launch and reentry operations and replacing prescriptive requirements for commercial launch and reentry licensing process with performance-based criteria;
2. The Department of Commerce (DoC) is directed to review commercial remote sensing regulations to ensure that U.S. companies “have every advantage in the international marketplace”;
3. The Department of Commerce is also directed to develop a plan to create a “one-stop shop” within the department for all commercial space flight activities no later than June 23, 2018;
4. The relevant agencies are directed to present a report on improving global competitiveness of U.S. space radio frequency spectrum policies, regulation, and other activities; and
5. Lastly, the National Space Council will review and provide recommendations by November 20, 2018, on export licensing regulations affecting commercial space flight activities. ​

What U.S. government agencies currently regulate commercial space activities?

Many different agencies currently have authority and input for a variety of commercial space activities, but the three main agencies are the Federal Aviation Administration (FAA), Federal Communications Commission (FCC), and the National Oceanic and Atmospheric Administration (NOAA), which is part of the Department of Commerce. The FAA regulates launch and reentry; the FCC regulates the use of spectrum and the potential for harmful radio frequency interference with other satellites or terrestrial operators; and NOAA licenses space-based remote sensing applications.

Depending on the mission, a commercial space company may require separate licenses from all three organizations. For example, Space X’s inaugural launch of its new Falcon Heavy vehicle in February 2018 needed all three types of licenses from the government, even though it was a test mission with a dummy payload. It needed approval from the FAA for launch of the vehicle and reentry of the three first-stage cores. It needed a license from the FCC to transmit images from the launch vehicle and the Tesla Roadster it placed into orbit. And it needed a license from NOAA for the cameras used on the mission because they were capable of imaging the Earth, although it was later revealed that SpaceX did not have this license at the time of launch.

How does this directive affect current commercial space authorities and regulations?

The aim of this directive, and the intent of the National Space Council in its recommendations, is to streamline regulatory processes across different agencies of the U.S. government to ensure that necessary licenses for commercial space activities can be more easily acquired. The two key directives from this announcement are that the Department of Transportation will create a new regulatory system for managing launch and reentry activities, specifically considering a single license system for all launch and reentry operations; and that the Department of Commerce will create a “one-stop shop” for administering and regulating all commercial space flight. Both changes intend to make licensing and regulation of space activities easier on U.S. commercial firms who want to do more in space.

Almost immediately following the announcement of Space Policy Directive 2, Secretary of Commerce Wilbur Ross announced the creation of the Space Policy Advancing Commercial Enterprise (SPACE) Administration within DoC. SPACE will report directly to the secretary and will become the “one-stop shop” that the administration requested. The intent is for SPACE to coordinate across different offices within DoC in order to streamline regulatory processes and space-related activities.

Why is the administration making these changes?

The Trump administration is using this directive to spur different agencies to clarify, simplify, or eliminate regulatory processes and restrictions so that commercial space activities can occur more quickly and efficiently. The National Space Council developed these recommendations for improving commercial space regulation processes in February 2018, and Space Policy Directive 2 formalizes those recommendations and directs executive branch agencies to take action.

Commercial companies have reported feeling hampered by overly strict, complex, and lengthy U.S. government regulations. Because space is an inherently international domain, companies can sometimes choose to launch and operate their satellites overseas to avoid bureaucratic obstacles in the United States. But some level of “authorization and continuing supervision” by the government is required by the Outer Space Treaty.

Thus far, Space Policy Directive 2 has received a positive reaction from the commercial space industry. Industry appears to be welcoming the administration’s efforts to streamline and clarify many of these complex regulations that have inhibited commercial space efforts. The hope is that these changes will encourage the growth and competitiveness of U.S. commercial space companies by easing regulations and speeding up approval processes.

How is Space Policy Directive 2 different than the American Space Commerce Free Enterprise Act currently being considered in Congress?

The American Space Commerce Free Enterprise Act (H.R. 2809) was introduced in the House in June 2017 by Rep. Lamar Smith (R-TX) along with a group of 15 bipartisan cosponsors, including then-Rep. Jim Bridenstine (R-OK) who recently became the NASA administrator. It passed the House in April 2018 and is currently waiting for consideration by the Senate. The bill has much of the same intent as Space Policy Directive 2, namely to ease government regulations and make the United States the jurisdiction of choice for commercial space activities. The main difference is that H.R. 2809 includes more specific changes to processes, authorities, and oversight responsibilities for commercial space activity. For example, the bill specifies what information the application for a permit to operate a remote sensing satellite shall include and the factors that the government can and cannot consider when reviewing an application. In general, the provisions in H.R. 2809 would make it more difficult for the government to deny a permit or license to commercial space companies, and it limits the ability of the Defense Department and intelligence agencies to slow down approval processes. Space Policy Directive 2 does not provide the same level of specificity and instead directs the various government agencies involved to develop plans and proposals of their own.