What Is the EU Space Act?

A New Law for a New Era in Space

The European Commission formally introduced a legislative proposal on June 25, 2025, known as the EU Space Act. This proposal, a formal Regulation on the safety, resilience, and sustainability of space activities in the Union, represents the most significant attempt to date to create a unified legal framework for the modern space economy. It’s a legislative response to a fundamental shift in the nature of space, moving from a domain of state-run agencies to a bustling, commercial-led marketplace.

This “New Space” economy is characterized by a dramatic increase in private-sector investment and activity. The proliferation of large satellite constellations, some numbering in the thousands, has fundamentally altered the orbital environment. While this commercial boom has lowered costs and created new services, it has also generated a new class of problems. The “Old Space” legal frameworks, based on United Nations treaties from the 1960s, were designed for a few state actors and are not equipped to manage the realities of an orbit crowded with commercial operators.

The new challenges are acute. Orbital congestion has become a primary operational risk, with the sheer number of objects increasing the likelihood of collisions and the generation of more space debris. Beyond these physical risks, a new set of geopolitical and security threats has emerged. The war in Ukraine exposed the vulnerabilities of space infrastructure, with rising concerns about the “weaponization of space assets,” electronic warfare, and cyberattacks against critical satellite systems. These systems, which provide everything from navigation and communications to Earth observation, are now considered critical infrastructure, and their security is a matter of EU strategic concern.

The EU Space Act proposal is not yet law. As of late 2025, it is in the “ordinary legislative procedure,” a process where the European Parliament and the Council of the European Union negotiate and amend the text. This process is expected to take between 12 and 18 months, depending on the political complexity of the negotiations. In parallel with these negotiations, the European Commission is holding a public consultation, which began on July 15, 2025, and closed on November 7, 2025. This feedback window is a formal part of the legislative process, allowing stakeholders from within and outside the EU – including companies, industry associations, and other governments – to submit their opinions and concerns. It is this process that has brought formal, and often critical, feedback from international partners.

The Case for a Union-Wide Framework

The European Commission’s rationale for the EU Space Act is driven by a combination of internal economic frustrations and external security fears. The primary driver is the need to fix a broken and fragmented internal market.

Europe’s current regulatory landscape for space is a “patchwork” of different national laws. At the time of the proposal, at least 13 EU Member States had their own national space legislation, and several others, including Spain and Estonia, were in the process of drafting their own. This legal fragmentation creates a high-friction environment for businesses. A space company operating across the EU might face different licensing requirements, technical standards, and supervisory authorities in each country it operates in. This duplication increases complexity, drives up administrative costs, and creates significant legal uncertainty.

This fragmentation directly hinders the EU’s economic and industrial goals. It creates barriers for companies, particularly the start-ups and small-to-medium-sized enterprises (SMEs) that are the backbone of the “New Space” economy. While the EU has world-class space programs like Galileo (navigation) and Copernicus (Earth observation), its commercial sector struggles to “scale up” and compete with companies from the United States, which benefits from a large, unified domestic market. The French Senate noted in 2024 that this fragmentation posed a clear risk to the internal market, and the Commission has identified the Space Act as a key priority for regaining EU competitiveness.

Alongside this economic driver is an equally strong security imperative. The EU Space Act is a legislative response to the growing vulnerability of European space infrastructure. The proposal’s text directly addresses rising geopolitical, cyber, and physical risks. It’s a move to protect the Union’s “critical infrastructures,” which are increasingly reliant on space-based services. By creating common, high standards for resilience and cybersecurity, the proposal seeks to enhance the EU’s “strategic autonomy” – its ability to act independently and securely without relying on third parties or being vulnerable to external threats.

To achieve these goals, the Commission made a deliberate and powerful legal choice. The proposal is a Regulation, not a Directive. This is a distinction of a legal expert. A Directive would have been a weaker tool, merely setting goals for Member States to update their 13+ fragmented laws, which would have likely preserved the “patchwork” system. A Regulation, by contrast, is the EU’s strongest legal instrument. It is a single, binding law that, once passed, becomes directly applicable in all 27 Member States at the same time, superseding any conflicting national laws. This is the Commission’s chosen tool for replacing the 13 different approaches with one single market for space.

The EU’s legal authority to enact such a sweeping law is also a point of nuance. The EU treaties do not have a dedicated “space law” power. Instead, the Commission is “bootstrapping” this legislation using two of its most powerful existing competencies: Article 114 of the Treaty on the Functioning of the European Union (TFEU), its power to harmonize rules for the internal market, and Article 191, its power to protect the environment. This legal strategy is not only clever but also revealing. It frames space activity as, first, an economic service that must flow freely within the single market, and second, as an industrial activity with an environmental footprint that the EU has a right to regulate. This direct link to environmental policy explains the power and ambition of the Act’s “sustainability” pillar and connects it directly to the EU’s overarching political priority, the European Green Deal.

The Three Pillars of the EU Space Act

The legislative text of the EU Space Act is structured around three central pillars, each designed to address a specific set of challenges in the “New Space” era: Safety, Resilience, and Sustainability. These three pillars form the core of the new regulatory framework, setting out technical and operational obligations for any company wishing to operate in or provide services to the European Union. The following sections will analyze the specific mandates within each of these pillars.

Pillar One: A Framework for Space Safety

The first pillar of the EU Space Act addresses the physical safety of space operations, a direct response to the growing problem of orbital congestion. As Low Earth Orbit (LEO) becomes increasingly crowded with large satellite constellations and decades of accumulated space debris, the risk of collisions is no longer a theoretical threat but a daily operational reality. A catastrophic collision could trigger a chain reaction of new debris, a scenario known as the Kessler syndrome, which could render entire orbits unusable for generations.

The Act tackles this by introducing a common set of EU rules for Space Traffic Management (STM). These are not (yet) a centralized “Eurocontrol for space” that actively directs orbital traffic. Instead, the proposal sets a foundational framework by harmonizing the “rules of the road” – the technical and operational obligations that all operators must follow to ensure predictability and safety. This includes robust rules for tracking space objects and for mitigating “high-interest events,” such as near-misses or potential collisions.

The most concrete and demanding new mandate in this pillar is a new standard for space debris mitigation. The proposal sets a new, binding target for the end-of-life disposal of spacecraft. Operators will be required to demonstrate a 90% success rate for safely de-orbiting their satellites (to burn up in the atmosphere) or moving them to a “graveyard orbit” at the end of their mission. This 90% target applies to all orbits and is a significant increase from current operational baselines, which are closer to 60% for geostationary orbit (GEO) and 65% for LEO.

This new rule will have tangible consequences for satellite design and mission planning. Operators will need to build more robust and redundant propulsion systems to ensure they can perform this final maneuver, adding cost and complexity but also contributing to the long-term preservation of the orbital environment. The Commission will also support the implementation of these rules by developing guidance materials and best practices, particularly on “novel areas… such as orbital traffic rules”.

Pillar Two: Building Resilience in Space Infrastructure

The second pillar of the EU Space Act is a direct legislative response to the new security realities of the 21st century. It moves cybersecurity and physical protection from an operational “best practice” to a mandatory, core design requirement for all space missions. The Act recognizes that space systems are now critical infrastructure, and their vulnerability to cyberattacks, signal jamming, or physical threats is a matter of EU economic and national security.

The resilience chapter of the proposal introduces specific, tailored cybersecurity requirements for all space operators, covering both the ground segment (control centers, data links) and the space segment (the satellites themselves).

The proposal’s Article 84 lays out general requirements. Operators will be mandated to implement “tailored cybersecurity measures” for both their spacecraft and ground segments, based on a formal security risk assessment. A key technical mandate is the requirement that operators must ensure that “only authorised devices communicate” with the systems controlling the satellite. This rule is a direct countermeasure against spoofing (tricking a satellite with false commands) or hijacking (a hostile takeover of the asset), which are among the most serious cyber threats to a space mission.

Article 85 of the proposal introduces a specific mandate for cryptography. Operators will be required to “define a cryptographic concept” to ensure the cybersecurity of their missions. This means they must select, implement, and manage strong cryptographic mechanisms – in simple terms, encryption – for their most sensitive data links. This includes the telecommands (instructions sent up to the satellite), the telemetry (health and status data sent down), and the configuration of the space mission. The Commission is also empowered to adopt further technical acts to specify the use of certified cryptographic products and will support research and development into new encryption technologies and protocols.

A central legal aspect of this pillar is its relationship with other EU security laws. The European Union already has a powerful cybersecurity framework in the NIS 2 Directive (on the security of network and information systems) and the CER Directive (on the resilience of critical entities). However, these laws were designed for terrestrial infrastructure; they primarily cover the ground segments of space systems. This created a massive, logical security gap: a space operator could be legally required by NIS 2 to have a hyper-secure ground station, which in turn was communicating with a completely vulnerable, unencrypted satellite in orbit.

The EU Space Act is designed to fill this gap. The proposal explicitly states that it will serve as ‘lex specialis’ – a Latin legal term meaning a specific law that overrides a more general one. For any space operator that qualifies as an “essential or important entity” under NIS 2, the Space Act’s resilience chapter will apply instead of the NIS 2 rules. This is a smart and efficient legal maneuver. It avoids “double regulation” (forcing companies to comply with two different laws) and creates a single, seamless, end-to-end security framework that covers the entire mission, from the operator’s control center on Earth to the satellite in orbit.

Pillar Three: The Mandate for Sustainability

The third pillar of the EU Space Act is its most novel, ambitious, and, as international feedback has shown, most controversial component. This pillar extends the concept of “sustainability” far beyond the simple mitigation of space debris. It reframes space as an environment whose total health must be protected, and in doing so, it attempts to export the EU’s “Green Deal” philosophy into orbit.

The central compliance mechanism of this pillar is the Environmental Footprint Declaration (EFD). This is a new, mandatory document that all operators must submit as part of their application for authorization. This declaration requires an operator to calculate the total environmental impact of their space mission, not just in orbit, but throughout the space mission lifecycle. This “cradle-to-grave” assessment would include, for example, the environmental impact of manufacturing components, the carbon footprint of the launch, and the impact of its end-of-life disposal.

This declaration is not based on the honor system. An operator cannot simply submit its own EFD. The proposal creates a new class of Qualified Technical Body (QTB), which will act as an independent certifier. An operator must first complete its environmental footprint studies and data, then transmit this to a QTB to obtain a formal certificate attesting that the EFD has been properly calculated. Only after receiving this third-party certification can the operator submit its application for authorization.

The scope of this “environmental footprint” is exceptionally broad. It includes the expected rules on debris and launch emissions, but it also contains new rules to mitigate light and radio pollution. The light pollution rules, which would set limits on the visual brightness of satellites, are a direct response to complaints from the astronomical community, whose observations are increasingly hampered by large, reflective satellite constellations.

Furthermore, this pillar looks to foster a “circular economy” in space through new rules on In-Space Operations and Services (ISOS). Article 101 of the proposal mandates that new spacecraft must be “equipped to receive in-space servicing via dedicated interfaces”. In practical terms, this means new satellites must be designed with standard “grapple fixtures” or refueling ports, making it possible for other spacecraft to repair, refuel, or safely de-orbit them. This forward-looking rule is intended to create a new commercial market for in-orbit servicing and make space activities more sustainable in the long run.

This sustainability pillar is perhaps the clearest example of the “Brussels Effect” – the EU’s ability to set global standards by regulating its own large and wealthy single market. By requiring all operators, both EU and non-EU, to comply with its new environmental methodology (the EFD) as a condition of market access, the EU is effectively forcing the entire global space industry to adapt to its standards. This is not just an environmental policy; it’s a powerful industrial and geopolitical tool. It is also the primary source of international friction, as other global players, particularly the United States, view these new environmental rules as “non-tariff barriers” designed to protect the EU market and disadvantage foreign competitors.

Governance and Implementation: The New EU Space Architecture

The EU Space Act doesn’t just set new rules; it creates a new, multi-layered governance structure to implement and enforce them. The entire system is designed to achieve the Act’s primary goal: to replace the fragmented “patchwork” of national authorities with a single, harmonized authorization process that creates a true “single market” for space.

The core of this new system is harmonized authorization. Under the proposal, an authorization (or license) for a space activity issued by the “competent authority” in one Member State will be recognized as valid across all 27 Member States. A company based in France, for example, could get its authorization there and use it to operate ground stations in Spain and sell data in Germany without seeking separate licenses. This is meant to solve the central fragmentation problem. However, the proposal does allow Member States to “retain the possibility of imposing stricter requirements” if “objectively necessary” to safeguard safety or sustainability in their own territory, a clause that could potentially reintroduce a degree of fragmentation.

To streamline this new pan-EU process, the Commission will create and manage a One-Stop Information Portal. This digital platform will be the central hub for collecting, processing, and exchanging all data related to the licensing process. It will be used by all stakeholders: the European Commission, the EU Agency for the Space Programme (EUSPA), the 27 Member State competent authorities, and the space operators themselves.

The governance structure itself is a shared-power model, with distinct roles for EU-level bodies and national authorities. The relationships and responsibilities are best understood in a clear framework.

While the Commission, EUSPA, and national authorities are known entities, the Qualified Technical Body (QTB) is a new and powerful creation of this Act. The proposal’s legal text defines a QTB as a “technical body established in a Member State which performs technical assessment” on matters of safety, resilience, and sustainability.

Its bureaucratic name belies its power. The QTB is not just an advisory body; it is a mandatory gatekeeper for market entry. As detailed in the sustainability pillar, an operator cannot apply for an authorization until it has first received a certificate from a QTB for its Environmental Footprint Declaration. This gives these (likely private or semi-private) notified bodies the power to block a company’s application before it even reaches a national regulator. This new, mandatory compliance step creates a new bottleneck in the authorization process, which has become a major point of concern for international industry.

The Path to the EU Market for Non-EU Operators

For “New Space” companies and investors based in the United States, India, Japan, or the United Kingdom, this is the most pressing section of the law. The EU Space Act creates a new, high barrier to entry and lays out two, and only two, distinct pathways for a “third-country” (non-EU) space service provider to legally access the European Union market.

Path 1: The “Equivalence” Decision. This is the “easy” path, but it is entirely at the European Commission’s discretion. The Act empowers the Commission to adopt an “equivalence decision”. This is a unilateral declaration by the Commission that a third country’s entire legal framework for space activities is “equivalent” to the EU Space Act’s rules on safety, resilience, and sustainability. If the Commission were to grant an equivalence decision to, for example, Japan, then Japanese operators could provide services in the EU without needing to undergo individual checks. This process will be slow, political, and is not expected to be used for major partners like the US for many years, if ever.

Path 2: Individual Assessment. This will be the default “hard” path for all non-EU operators for the foreseeable future. If no equivalence decision exists (as will be the case on day one), any non-EU operator wanting to provide space-based data or services in the Union “will be required to undergo checks to establish compliance” with the Act. Critically, this technical assessment will not be conducted by the operator’s home regulator (like the FAA). It will be carried out by the EU’s own agency, EUSPA (the European Union Agency for the Space Programme). A US company, for example, would have to submit its designs, risk assessments, and EFD data to EUSPA for technical approval.

In addition to this, all third-country space operators will be required to designate a formal legal representativelocated in one of the EU Member States.

The power dynamic in this system is a point of legal and geopolitical art. International partners, including the US and India, have asked for “mutual recognition” or the “acceptance of mutual standards”. This implies a relationship of equals: “Our standards are good, your standards are good, let’s agree to accept each other’s licenses.”

The EU is not offering this. It is offering “equivalence.” The difference is significant. “Mutual recognition” is a negotiation between two equal partners. “Equivalence” is a unilateral judgment. The EU, and only the EU, sits as the judge and decides if the other country’s system is “good enough” by EU standards. This gives the European Commission immense leverage. It can use the promise of an “equivalence” decision as a powerful tool to pressure other countries to align their national space laws with the EU’s, furthering the “Brussels Effect” on a global scale. The US State Department’s formal demand that the EU “recognize existing US licensing” is a direct and forceful rejection of this unilateral, EU-centric model.

The Liability Question: What the Act Does Not Address

Just as important as what is in the 100+ page proposal is what is not. The most significant and deliberate omission in the EU Space Act is the harmonization of rules for liability and insurance.

The proposal’s text, COM(2025) 335, is silent on who pays for damage caused by a space object, and it does not introduce a single, EU-wide mandatory insurance requirement. Furthermore, the Act does not establish a financial liability cap for operators. This is a major point of divergence. Some Member States, like France and Germany, have national liability caps to encourage investment. And while the EU Act was being drafted, the Italian Parliament passed its own new space law, which does include a specific liability regime, with a compulsory insurance cap of EUR 100 million per claim.

The Commission’s decision to “punt” on this issue was likely a calculated political move. The reasons are complex. First, harmonizing liability law is, as some legal analyses note, “explicitly excluded from the EU competence” in some areas and is, at best, politically “complex and potentially counterproductive”. It touches on deep, sensitive issues of national sovereignty.

Second, the entire global liability framework is based on the UN Outer Space Treaties, principally the 1967 Outer Space Treaty and the 1972 Liability Convention. Under these treaties, it is the State (the nation) that is absolutely and internationally liable for any damage its space objects cause. How each nation (like France or Italy) then passes that liability risk down to the private operator launching from its territory (through insurance mandates or national caps) is a matter of national law. Trying to insert an EU-level rule into this complex chain of international and national responsibility was likely seen as a fight that would have jeopardized the entire legislative package.

This omission, while politically pragmatic, creates a fundamental structural weakness in the Act. This is the “Half-Harmonized Single Market.”

The entire purpose of the EU Space Act is to solve the “fragmentation” problem and create a single, predictable market. But by omitting liability, it only solves half the problem.

Consider the “New Space” startup the Act is designed to help. Under the new law, that startup will get a single, harmonized technical authorization. This is a clear improvement. But that’s where the harmony ends. That startup must still navigate the fragmented “patchwork” of 13+ different national liability and insurance laws. The fact that Italy, Spain, and Estonia are all creating new and different national liability frameworks at the same time the EU Act is being debated proves that this fragmentation is not only continuing but accelerating.

This fundamentally undermines the Act’s central economic promise. Businesses, especially SMEs, will stillface significant legal uncertainty, new administrative burdens, and different cost structures (like wildly different insurance requirements) in every Member State they want to operate in. The single market for space remains, in this critical aspect, incomplete.

International Reactions and Geopolitical Friction

As the public consultation period on the EU Space Act draws to a close in November 2025, the legislative proposal is facing significant international pushback. The feedback submitted by the EU’s key global partners is not merely technical; it represents a high-stakes geopolitical and economic negotiation.

The United States’ Formal Objections

The sharpest criticism has come from the United States. In a formal response submitted on November 4, 2025, prepared jointly by the Departments of State and Commerce, the US government warned that the Act would impose “unacceptable regulatory burdens” on US companies. The response, which consolidated input from over 70 US space companies, labeled the new regulations as “unfair and unwarranted”.

The US objections are focused and direct:

• “Non-Tariff Barriers”: The US argues that the new rules, especially the extensive environmental requirements in the sustainability pillar, will “drive up costs” and are, in effect, a new form of “non-tariff barrier” – a formal trade dispute term for a rule that is designed to look like a safety or environmental standard but which functions as a protectionist measure.
• Targeting US Companies: The US response claims the rules are not neutral and unduly target “large telecommunications satellite constellations”. This is a thinly veiled reference to SpaceX’s Starlink, the largest such constellation. The US submission specifically calls the new rule to limit the visual brightnessof spacecraft (the light pollution rule) “impossible” to implement and argues it would “disproportionately affect US companies [that] operate at lower altitudes”.
• “Discriminatory” Launch Preference: The US strongly objects to provisions that appear to favor European launch providers. It calls out a clause that would only approve non-EU launchers (like SpaceX or Rocket Lab) when “‘no readily available substitute or realistic alternative exist[s] in the Union'” as “discriminatory”.
• Threats to Cooperation: The US closed its submission with a clear warning. It stated that the Act, as drafted, could “introduce challenges” and “jeopardise future cooperation” between the US government and the EU, individual EU countries, and the European Space Agency (ESA) in critical areas like space exploration, debris mitigation, and data sharing.

India’s Concerns for EU Competitiveness

The feedback from India’s space industry, submitted as a joint position paper by the Space Industry Association of India (SIA-India) and Grayspace Law & Policy Consulting, is more subtle in its tone but equally critical in its substance.

The Indian paper takes a “pro-business” critique, warning that the EU Space Act, as written, could hurt the EU’s own competitiveness.

• “Regulatory Overlap”: The paper calls for the Act to avoid “regulatory duplication” and “regulatory overlap” with existing international or national frameworks. Instead of the EU’s unilateral “equivalence” model, India is asking the EU to “accept mutual standards,” a model based on partnership, not judgment.
• “Market Access Barriers”: Echoing the EU’s own internal economic goals, the SIA-India paper highlights the risk of “potential market access barriers for start-ups and small and medium enterprises (SME)”. It argues that the high compliance costs and administrative burdens associated with the Act (like the EFD) will hurt the very innovators the Act claims to support.

A Critical Practical Hurdle: QTB Capacity Constraints

Woven into the feedback from India and other international partners is a critical, practical warning about a fundamental flaw in the Act’s implementation: the “Qualified Technical Body (QTB) capacity constraints”.

This is perhaps the most serious “real-world” challenge to the proposal. The Act invents a new, mandatory certification (the Environmental Footprint Declaration) and a new class of certifiers (the QTBs) to issue certificates.

The problem, as industry has pointed out, is that there are very few, if any, organizations in the world that currently exist with the recognized expertise and legal notification to certify the total “environmental footprint of a space mission” as defined by the Act.

The EU is mandating a certification process without first ensuring the certifiers exist in sufficient numbers.

This will create an immediate, massive, and global bottleneck. On the day the Act comes into force, every space operator in the world – from Airbus in France, to SpaceX in the US, to a new startup in India – will be lining up at the doors of the same handful of newly-notified QTBs, all seeking the same mandatory certificate.

The predictable result will be long delays, soaring certification costs, and a de facto blockage of market access, regardless of an operator’s actual compliance. This practical implementation flaw, highlighted by non-EU partners, is one of the most serious challenges the European Commission and Parliament must now solve in their negotiations.

Summary

The EU Space Act, proposed by the European Commission in June 2025, is the most ambitious legislative initiative for space governance in a generation. It is a direct response to the “New Space” economy, attempting to replace a fragmented “patchwork” of 13+ national laws with a single, harmonized Regulation. The Act’s stated goals are to boost the EU’s economic competitiveness and ensure its “strategic autonomy” in an increasingly contested domain.

The proposal is built on three pillars. The Safety pillar introduces new rules for space traffic and a binding 90% success rate for end-of-life debris disposal. The Resilience pillar mandates new, high standards for cybersecurity and encryption, acting as a ‘lex specialis’ to close the security gap between ground-based laws and space-based assets. The Sustainability pillar is the most novel, introducing a mandatory “Environmental Footprint Declaration” (EFD) that must be certified by a new “Qualified Technical Body” (QTB), effectively exporting the EU’s “Green Deal” philosophy into orbit.

However, the Act has two fundamental weaknesses. First, it has a significant internal gap: it deliberately omitsthe harmonization of liability and insurance laws. This failure to address financial responsibility and risk means the single market for space remains “half-harmonized,” leaving businesses to navigate a complex and fragmenting patchwork of national liability rules.

Second, as of late 2025, the Act faces a challenging legislative negotiation, marked by severe external pushback. The United States has formally objected, calling the sustainability rules “unfair,” “discriminatory” protectionism, and “non-tariff barriers” that target US companies. Other key partners, like India, have raised serious practical concerns about “regulatory overlap” and, most pointedly, the “QTB capacity constraint,” warning the Act could create an unworkable bottleneck that harms the EU’s own competitiveness.

The future of the EU Space Act now depends on a difficult balancing act. The EU legislature must find a way to reconcile its high-standard “Brussels Effect” ambitions with the geopolitical and economic realities of a global space economy that is not waiting for it.