The Contours of Permissionless Innovation in the Outer Space Domain

A permissionless innovation regulatory model, importantly featuring a default presumption of approval of innovators’ new activities, is credited with fostering the development of the Internet. For the first time, this regulatory model is being explored for adoption in the outer space domain, a reasonable choice given the amount of innovation by commercial entities in that sector. However, translation of the model to outer space is complex because permissionless innovation is contextual, and the outer space domain differs from the cyber domain in important respects. First, international obligations require the U.S. government to authorize and supervise commercial space activities. Second, national security concerns are raised by everyday, non-illicit space activities. Third, space business investors actually demand enhanced regula* Veronica Haggart & Charles Work Professor of International Trade Law, Co-Director—Space, Cyber and Telecom Law Program, University of Nebraska College of Law. The author thanks his colleagues Professors Jack Beard, Frans von der Dunk, Gus Hurwitz, Eric Berger, Rob Denicola, Harvey Perlman, and Anna Shavers; NSRI Law College Research Associate Danielle Miller; industry and government participants in the Univ. of Nebraska’s 9th Annual DC Space Law conference (Oct. 17, 2016); and academic participants in my Law College colloquia on the article (Feb. 2017) for their thoughtful comments and reactions to earlier drafts of this article and ideas expressed in it. The author also thanks Gregg Moran, University of Nebraska College of Law, Class of 2018, for his assistance on citations and proofreading, and Jared Koch, University of Nebraska College of Law, Class of 2018, for his assistance on proofreading. The author thanks the editors of the Univ. of Pennsylvania Journal of International Law for their work on the article, and its footnotes. All errors and omissions are mine. 1 Schaefer: The Contours of Permissionless Innovation in the Outer Space Doma Published by Penn Law: Legal Scholarship Repository, 104 U. Pa. J. Int’l L. [Vol. 39:1 tory certainty given the risk, and often long-time horizons, of their investments. New on-orbit space activities, such as asteroid mining, satellite servicing, debris removal, and lunar habitats and research facilities, currently fall within a regulatory gap—the Executive Branch lacks express Congressional delegation to regulate such activities. This situation may appear to be a victory for proponents of a nearly pure or unadulterated version of permissionless innovation. Indeed, to protect the status quo, permissionless innovation advocates are ignoring long-established and agreed upon rules of treaty interpretation to argue that the U.S. government is not under an obligation to authorize and supervise U.S. commercial space companies’ activities. The irony is that the current gap actually undermines the benefits of permissionless innovation. The Executive Branch faces a Hobbesian choice of following Congressional intent and standing aside as new on-orbit activities are engaged in or complying with international obligations and addressing potential national security concerns by continuing to leverage existing authorities in an attempt to reach on-orbit activities. U.S. commercial space businesses—the innovators—are left in a similarly difficult situation: facing a risk of foreign government retaliation in the event of the U.S. government’s non-compliance with international obligations, or being forced to engage in costly and time-consuming litigation if the U.S. government blocks their proposed activity by stretching existing authorities. Fortunately, the U.S. Congress can enact a solution that fills the gap—providing compliance with international obligations, protection of national security, and regulatory certainty for U.S. space businesses—and at the same time ensure that permissionless innovation thinking and esprit de corps control the interagency approval process, including a default presumption in favor of approval. 2 University of Pennsylvania Journal of International Law, Vol. 39, Iss. 1 [], Art. 4 http://scholarship.law.upenn.edu/jil/vol39/iss1/4 2017] Contours of Permissionless Innovation 105