Luxembourg has established itself as a state committed to fostering entrepreneurship and commercial development in the space sector. Its implementation of a dedicated legal framework has confirmed the country’s ability to build a favourable environment for the structural development of activities related to the use of outer space.
Business-oriented legal framework
The development of Luxembourg’s space sector has always been driven by commercial space activities, and the relevant legal framework in the Grand Duchy has been adopted in line with the progress made by private-sector companies. With a view to providing a legal basis for the activities of the first Luxembourg commercial satellite operator, Luxembourg passed the Electronic Media Law in 1991. Subsequently, the desire to create a favourable environment for companies whose purpose was the exploration and use of outer space resources was the catalyst for the advanced and distinctly forward-looking provisions of the Space Resources Law of 20 July 2017. Now, lawmakers have also enacted the Space Activities Law of 20 December 2020, furnishing companies operating in the space sector with a single piece of legislation that applies to the whole industry.
Authorisation and supervision of space activities
Luxembourg is party to the main United Nations space treaties, and its national legal framework reflects the requirements of such treaties with respect to the authorisation and continuous supervision of the space activity of those individuals and entities for which Luxembourg bears international responsibility.
In practice, the Space Activities Law sets out the regime for authorisation applicable to all current and future space activities – except for the space resources exploration missions, where the applicable legal requirements have already been defined by the Space Resources Law. In addition, according to the Electronic Media Law, no one can establish and operate a Luxembourg satellite system using Luxembourg radio frequencies without first obtaining a license (concession).
“In practice, the Space Activities Law sets out the regime for authorisation applicable to all current and future space activities.”
Given the synergies and similarities in the supervision requirements and systemic risk factors that exist between the space and finance industries, the conditions space operators must satisfy and the possible grounds for the withdrawal of authorisation were largely inspired by the existing rules applying to Luxembourg financial sector operators. In particular, these include sound corporate governance, auditing, honourability on the part of management, and sufficient financial assets at the level of the space operator.
The Luxembourg Space Agency, established as a Luxembourg foundation, has been entrusted with the authority to coordinate the overall authorisation procedure, and tasked with providing support to the space industry, attracting new businesses, providing innovative financing solutions and facilitating academic learning and research.
A new pillar of Luxembourg’s economy
The space sector is one of the priority sectors promoted by Luxembourg, in part due to its geopolitical neutrality and political stability. Over the past years, emphasis has been placed on bilateral and multinational cooperation and a significant number of private and public initiatives have flourished with a view to strengthening Luxembourg’s attractiveness on the international scene.
Efforts made in order to diversify Luxembourg’s economy have resulted in the creation of a business environment in the Grand Duchy that is conducive to space commerce. In establishing a legal, institutional, financial and commercial framework in line with business expectations, Luxembourg is successfully positioning itself as a facilitator, and increasingly as an important player, in the space industry.
More info: arendt.com/LuxSpace
Editor’s note: This article is brought to you by Arendt & Medernach and reflects only the opinion of the author.
This article was first published in the Silicon Luxembourg magazine. Read the full digital version of the magazine on our website, here. You can also choose to receive a hard copy at the office or at home. Subscribe now.