Annabel Griffin, Urszula McCormack, Kate Creighton-Selvay, Dale Rayner and others from our space team explore Australia’s growing influence in the global industry with takeaways from the AusSpace24 Summit, and share what you need to know about the new Technology Safeguards Agreement with the US.
Australia’s space industry is expanding, with the private sector increasingly at the helm of innovation and commercialisation. The interplay between evolving financing mechanisms, regulations and international legal commitments is shaping opportunities industrywide.
These trends were at the heart of the AusSpace24 Space Summit, which saw the Australian space industry come together at the International Convention Centre in Sydney at the end of May.
King & Wood Mallesons was the Legal Partner of the landmark summit. The KWM space team, a cross-section of the technology and telecommunications, government, fintech, fin reg and structured asset finance practices, facilitated panel discussions. These addressed the financing of space assets (led by Urszula McCormack and Dale Rayner) and the ethical and cultural considerations which come with the exploration of space and celestial bodies (led by Annabel Griffin).
Here, we share insights on some of our key takeaways from the Space Summit, setting the scene as the industry prepares for significant events like the 2025 International Astronautical Congress in Sydney. These takeaways include:
- Shift to Private Sector: A move towards private-led initiatives in space exploration and commercialisation.
- Innovative Financing: Equity financing emerges as a preferred method amidst the unique challenges of space asset financing.
- Regulatory Evolution: Australia’s regulations, including the Space Launches and Return Act 2018, are adapting to new technologies; however, international protocols like the Space Protocol remain unratified.
- International Legal Landscape: Balancing the Moon Agreement with the Artemis Accords presents unique legal challenges for Australia regarding space resource utilisation.
- Geographic Advantage: Australia’s location offers a competitive edge for equatorial low earth orbit launches, demanding strategic development of spaceport infrastructure.
- Global Engagement: The upcoming International Astronautical Congress in Sydney highlights Australia’s growing influence in the global space industry.
In other news, the Technology Safeguards Agreement between Australia and the USA that we previously reported on (see here) came into effect on 23 July 2024. We’ve included a short overview of the new international agreement, and what it means for participants in the Australian space launch industry, below.
Read on for more!
Takeaways from the AusSpace 24 Summit
Communication and collaboration are key to growth in the new private-public era
The establishment of the Australian Space Agency in 2018 paved the way for the expansion of Australia’s commercial space activities.
The head of the Australian Space Agency, Enrico Palermo, and defence officials from Australia and the United States all noted in their respective addresses that the mobilisation of space is no longer the exclusive domain of the government. Rather, the commercial space market is becoming increasingly defined on both a global and domestic level, with governments eager to encourage space activity driven by the private sector.
In light of this emerging trend, Michael Jones (Executive Chairman and Group CEO of Equatorial Launch Australia (ELA)) and Jeremy Hallett (Executive Chairman of the Space Industry Association of Australia) each emphasised the need for greater communication with adjacent industries and supply chain participants, particularly investing in sectors that support heavy metal industries.
Opportunities abound – but come with risks (know how to navigate them!)
Space regulation plays an essential role in enabling the growth of the commercial space sector. As explored by KWM’s Urszula McCormack and Dale Rayner, the main theme underpinning space regulation is the need to balance opportunity with risk allocation. In particular:
- the early stages of financing space assets are acutely risky, which creates difficulties in procuring funding from traditional finance providers such as banks
- for this reason, equity financing is the preferred approach for space asset finance given the bespoke nature of these assets, and the need for distinct parts to come together
- the non-transferability of a license over a space asset is one of the most difficult hurdles for space asset financing, and
- unknown risks are addressed by insurance.
It is critical for financiers to have a comprehensive grasp of the regulatory environment in each jurisdiction involved in a space project. This means ensuring compliance with both local and international laws and navigating the intricacies of licensing and operations.
Hopes for regulations to keep pace with change (and charting a path across the complex mix of Australian and international laws in the meantime…)
The combination of international law and Australian-specific legislation creates a complex legal environment for industry participants to navigate.
Technology moves so quickly in this sector that often regulation struggles to keep pace. Ideally, regulatory issues are addressed in the near future to ensure that opportunities for the Australian space industry can be fully realised.
For more tips on financing space assets, see our earlier insights here.
Within Australia, space financing activity is generally governed by:
- the Space Launches and Return Act 2018, and
- general tort law.
Industry participants must also navigate other regulatory frameworks, including:
- the Civil Aviation Regulations administered by the Civil Aviation Safety Authority (CASA), for example in relation to approvals required for rocket launches, and
- spectrum licensing requirements administered by the Australian Communications and Media Authority (ACMA).
The Civil Aviation Regulations have modernised to suit advanced aviation technology such as drones, as explained by Jesse Suskin (Head of Government Relations and Public Policy at Wing (Alphabet Inc)). Some of these changes have included taking an outcomes-based approach for drone safety to exclude irrelevant features such as parachutes, contrasting the checklist-style approach for traditional passenger-carrying aviation.
On an international level, space asset financing activity is generally governed by:
- the five treaties developed under the auspices of the United Nations (including the 1967 Outer Space Treaty and 1979 Moon Agreement)
- the Artemis Accords 2020, and
- customary international law.
There is also an international protocol on space financing, but Australia has not ratified it (nor has any state). Known as the Space Protocol, it was created to protect financial interests in space assets as an extension to the benefits of the Convention on International Interests in Mobile Equipment 2001 (“Cape Town Convention”).
In the panel discussion between KWM’s Annabel Griffin, Dr Michael Mineiro (Senior Counsel at Akin), and Professor Melissa de Zwart (Professor of Space Law and Governance at the Andy Thomas Centre for Space Resources, and Deputy Director at the ARC Centre of Excellence in Plants 4 Space, University of Adelaide), a few contentious issues were raised about Australia’s potential need for legislative reform.
The most complex and controversial area currently concerns Australia being the only state party to the Moon Agreement to have also signed the Artemis Accords. These two international instruments arguably take opposing perspectives regarding the utilisation of space resources:
- The Moon Agreement provides that all lunar resources are a “common” area to be equitably shared amongst all the states, and
- The Artemis Accords are based on the approach that signatories may contract with each other to allow for specified commercial use of space resources.
Underlying these issues are broader ethical considerations such as the cultural value of space and celestial bodies, where the distributed nature of development could be the best path to solving the world’s most pressing problems.
We can’t get enough of spaceports (and Australia is a natural)
One notably competitive aspect of the Australian space arena is spaceports. Put simply, there cannot be a space asset in outer space without the launch.
As Michael Jones (Executive Chairman and Group CEO) noted, the ELA is currently expecting 9 launches in FY25 and 33 in FY26. The ELA has also received equity investment from the Northern Territory government.
Australia has a natural competitive advantage in the market for equatorial low earth orbit launches. There is a particularly rich market in Asia, with strong demand for launch slots at Australian spaceports.
However, it is a complex process for spaceport infrastructure to come together, given the many players which need to be aligned (including the spaceport company itself, payload customers and rocket manufacturers) and the regulatory complexities highlighted above.
Looking ahead
The Space Summit is just the beginning of an exciting and prosperous path for the Australian space industry. We look forward to a major global space event hosted in Sydney next year – the 76th return of the International Astronautical Congress (IAC). It is estimated that IAC Sydney 2025 will host more than 7,000 delegates from over 100 countries.
What do you need to know about the Technology Safeguards Agreement (TSA)?
The core purpose of the TSA is to allow for the protection of US space launch technology when used in Australia. US space launch technology includes any US tech that is launched from, or returning to Australia, including launch vehicles, satellites, equipment and data.
Finalisation of this agreement is good news for the Australian space launch industry given a key feature of the agreement is that it facilitates exports and import permits for space launch activities in Australia. The agreement provides terms designed to facilitate the lucrative space launch market for US assets on terms acceptable to the US, including:
- those involved in launches will be required to develop technology transfer control plans and technology security plans, and notify the US and Australian government if they are unable to meet their requirements
- permits can be revoked if those plans are not complied with
- non-US holders of Australian permits need to comply with equivalent terms and conditions to the technology transfer control plans
- segregation of certain US space launch activities
- the Australian government needing to procure access for the US government to US space launch activities.
So, what’s next?
The agreement places obligations on the Australian government for the protection of US space launch technology. These obligations are implemented through primary legislation – and the Australian Space Agency has said this will ‘primarily’ be through the Space (Launches and Returns) Act 2018. Presumably given certain space assets are also subject to the Defence Export Controls Act (ie where there is dual use), that act will also be relevant. Whether new legislation is required will be something we’ll keep an eye on.
Assuming existing laws are used to implement the new obligations under the international agreement, we’ll see these obligations flowed through into conditions on regulatory approvals or permits.
Need help navigating this rapidly evolving and complex area? With an experienced, multi-disciplinary Space Law team, KWM is well placed to assist space industry participants with their legal needs, including in relation to asset financing, spectrum licensing, regulatory compliance, general corporate advice and contracting, tendering and procurement. Please contact any member of the KWM Space Law team – we’d be delighted to assist.
Check out our related insights, including…
- Our KWM 2024 Space Sector Insights Briefing (watch on demand)
- Space and the law: Seven things you need to know – King & Wood Mallesons Pulse (kwm.com)
- Lifting our gaze: an update on the Australian space industry and satellite cyber security – KWM
- Financing space assets: 6 things you should know – KWM
- Space: from renewables to remote access, how the final frontier is solving Earth’s problems – KWM
