Outer Space Treaty: Exploitation of Extra-terrestrial Bodies and Acquisition of Land In Outer Space


The Outer Space Treaty, Ownership of land and property on moon and other extra-terrestrial bodies is a thought which most of the people dream to achieve in their life. We have seen many celebrities talking about schemes to buy land on outer space and hoping to snatch up their share before any private companies or nation decide to do so. These schemes are crafted by keeping in mind certain loopholes in the legal framework.

But in reality, the truth is totally opposite. Only two treaties exist with regard to the extra-terrestrial sales. The treaties are THE OUTER SPACE TREATY 1967 and THE MOON TREATY 1984. These international treaties clearly mention that no nation owns these bodies. According to these treaties these bodies are there for the good of all human beings and it will be wrong for any state to own these lands and makes the private ownership of these bodies impossible.

Due to the vast reaches of outer space, which is also used for military purposes, it is of utmost important to impose an appropriate legal regime that ensures the rule of law and prevents monopolisation and national appropriation of outer space. Exploration and usage of outer space needs to be regulated and should protect the interests and benefit of all countries, thus preventing those few chosen countries possessing both the technology and immense influence, from occupying and imposing the divide et impera principle.

To sum it up no proper legislation is present at the very moment which properly explains the use of extra-terrestrial bodies and it contracts related to the ownership of these bodies are a myth right now.

Treaties related to Outer Space

The Outer Space Treaty, 1967

On Jan. 27th, 1967, the United States, United Kingdom, and the Soviet Union sat down together to work out a treaty on the exploration and use of outer space. With the Soviets and Americans locked in the Space Race, there was fear on all sides that any power that managed to put resources into orbit, or get to the Moon first, might have an edge on the others – and use these resources for evil! As such, all sides signed “The Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies” – aka. “The Outer Space Treaty”. This treaty went into effect on Oct. 10th, 1967, and became the basis of international space law. As of September 2015, it has been signed by 104 countries (while another 24 have signed the treaty but have not competed the ratification process).

The treaty is overseen the United Nations Office for Outer Space Affairs (UNOOSA). It’s a big document, with lots of articles, subsections, and legalese. But the most relevant clause is Article II of the treaty, where it states:

“Outer space, including the moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means.”

The Moon Treaty,1984

On Dec. 18th, 1979, members of the United Nations presented an agreement which was meant to be a follow-up to the Outer Space Treaty and close its supposed loopholes. Known as the “Agreement Governing the Activities of States on the Moon and Other Celestial Bodies” – aka. “The Moon Treaty” or “Moon Agreement” – this treaty intended to establish a legal framework for the use of the Moon and other celestial bodies.

Much like the Outer Space Treaty, the agreement established that the Moon should be used for the benefit of all humanity and not for the sake of any individual state. The treaty banned weapons testing, declared that any scientific research must be open and shared with the international community, and that nations and individuals and organizations could not claim anything.

In practice, the treaty failed because it has not been ratified by any state that engages in crewed space exploration or has domestic launch capability. This includes the United States, the larger members of the ESA, Russia, China, Japan and India. Though it expressly forbids both national and private ownership of land on the Moon, or the use thereof for non-scientific, non-universal purposes, the treaty effectively has no teeth.

Loopholes Of these Treaties

Despite clearly saying that Outer Space is the property of all humanity, and can only be used for the good of all, the language is specific to national ownership. As a result, there is no legal consensus on whether or not the treaty’s prohibition is also valid as far as private appropriation is concerned.

However, Article II addresses only the issue of national ownership, and contains no specific language about the rights of private individuals or bodies in owning anything in outer space. Because of this, there are some who have argued that property rights should be recognized on the basis of jurisdiction rather than territorial sovereignty.

The Moon Treaty clearly states that there is nothing that expressly forbids companies from owning land on the Moon. However, with no way to claim that land, anyone attempting to sell land to prospective buyers is basically selling snake oil. Any documentation that claims you own land on the Moon is un-enforceable, and no nation on the planet that has signed either the Outer Space Treaty or the Moon Treaty will recognize it.

Liability of Nations With Regard to Commercial Space Contracts

The outer space treaty and the liability convention

“The United Nations Office for Outer Space Affairs (UNOOSA) is the Secretariat for the Legal Subcommittee of the United Nations Committee on the Peaceful Uses of Outer Space (COPUOS),” which is the main international body for the development of international space law. The General Assembly established the Committee as a permanent body in 1959 when it became clear that space was the new frontier and to ensure a “responsible approach to the exploration and use of outer space for the benefit and in the interests of all humankind.

This body concluded five main treaties in the past fifty years that continues to be the governing law in all space-related activities:

1) The Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies aka. Outer Space Treaty

2) The Agreement on the Rescue of Astronauts, the Return of Astronauts and the Return of Objects Launched into Outer Space aka Rescue Agreement

3) The Convention on International Liability for Damage Caused by Space Objects aka Liability Convention

4) The Convention on Registration of Objects Launched into Outer Space aka Registration Convention

5) The Agreement Governing the Activities of States on the Moon and Other Celestial Bodies aka Moon Agreement.

But these treaties hold no teeth in the present times as these treaties were signed between 1967 and 1984, when the companies like Space X and other commercial launch companies did not even emerge.

After thoroughly examining the Outer Space Treaty the article IV and VII of the treaty clearly states that “States Parties to the Treaty shall bear international responsibility for national activities in outer space, whether such activities are carried on by governmental agencies or by non-governmental entities.”

Further, in Article VII, the treaty states that “each State Party to the Treaty that launches or procures the launching of an object into outer space and each State Party from whose territory or facility an object is launched, is internationally liable for damage to another State Party to the Treaty or to its natural or judicial persons by such object or its component parts on the Earth, in air space or in outer space ” Again, it is clear from this article that if the damage is caused by an object launched by a commercial company at the behest of a government, that state would be liable. It also makes clear that a state will be liable if the object is launched from within its borders or from its facility, regardless of the purpose for its launch. While this treaty was not meant to address liability specifically, it laid the groundwork for the treaty to follow in relation to this topic. It is important to note that this treaty does not establish a standard of fault.

The outer Space Treaty only vaguely determines the liability appropriation. The treaty which specifically governs the topic of liability is the Liability Convention of 1972. This convention has been ratified by 91 states and additionally been signed by 22.

The close examination of this convention states that the article I defines the term of “launching state”. According to this article a launching state is a state from whose territory or facility a space object is launched. By defining launching state broadly to include a state whose territory or facility a space object is launched from, the definition automatically includes launches and activities conducted by commercial space companies such as SpaceX and other commercial launch companies. Hence, it can be clearly inferred that if Space X is involved in a catastrophic launch accident, the U.S. government will be liable under the international law for the entire damage as per the liability parameters of Liability Convention and the Outer Space Treaty.

Article II of the same convention states that the launching state shall be absolutely liable to pay compensation for the damage caused by its space object on the surface of the Earth or to aircraft in flight. Several other provisions are also laid down under this article which makes the state absolutely liable for its actions. This article also lays the provisions which talks about the liability when two states jointly launch a space object.

Indemnification programs

Because the state is made absolutely liable for the any damage caused by the space activities, the nation states have started to enact specific national legislation covering all the commercial launch activities and in turn reduce the liabilities of the concerned governments. For instance, individual countries such as the United States, China, France, and Russia have each developed their own separate policies to deal with commercial space companies.

In the United States, the Commercial Space Launch Activities Act (CSLA) and the associated regulations (CSLR) are the primary body of national U.S. law governing commercial launch activities.100 The CSLA, enacted in 1984is the principal source of law governing licensing and regulation of commercial space transportation in the United States. The United States encourages private sector launches, re-entries, and associated services and, only to the extent necessary, regulate those launches, re-entries, and services to ensure compliance with international obligations of the United States. After the licence is obtained the next order of business is to purchase a fixed amount of insurance for each launch and re- entry.

The US has a three- tier system of sharing liability between the government and the private companies to cover third party claims if something goes wrong in the space related activities. The first level of coverage is the insurance policy that all companies are required to purchase, the FAA determines a set amount of liability each company must purchase from a private third party to reflect the maximum probable loss. The second tier covers third party claims in excess of the first tier. The third and final tier includes any excess damages above the cap of the second tier. This third tier is also the responsibility of the launch company, but unlike the first tier, no insurance is required for this tier by federal law.

Other countries have set up indemnification systems similar to the United States to limit state liability. While they will ultimately be held liable under international law, indemnification programs such as these helps ensure that states can collect from commercial companies in the case of a catastrophic space disaster. According to the GAO, China, France, and Russia all have a first tier of insurance similar to that in the United States; however, that is where the similarities end. Unlike the three-tier system established by the United States, these other countries all have a two-tier system. This means that these governments essentially provide unlimited third-party indemnification over the initial insurance required by the commercial launch companies.

All these countries’ insurance regimes provide greater relief than the United States against third party claims because there is no third-tier limit on government indemnification. It is, however, important to keep in mind that the insurance commitments of these countries have never been tested. There has never been a third-party claim for a commercial space launch accident that reached the second tier.


International space law is one of the fields of international law that will be at the centre of attention in a matter of a few decades. I can argue this solely by visiting NASA’s webpage where they publish the latest news and discoveries and you can see how much is going on and that almost every day there is a new discovery and to cater all these discoveries a proper legal framework is required, so that concrete contracts can be made and the liabilities are appropriated properly between the parties.

If the above-mentioned changes are done to the space law then it will become easier for the space lawyers to simplify things and proper exploitation of the resources can be done.

Author: Rishab Pillai – a student from Dharmashastra National Law University (Jabalpur), in case of any queries please contact/write back to us via email vidushi@khuranaandkhurana.com or at Khurana & Khurana, Advocates and IP Attorney.

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