Business / Legal Working Group Outbrief. Chris Kunstadter ( Chair ) & Russ McMurry ( Vice Chair ). BLWG agenda t opics. MPL methodology review GSO and NGSO forecasts Waivers for many payloads and other Part 440 Mods
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Business / Legal Working Group Outbrief
Chris Kunstadter (Chair) & Russ McMurry (ViceChair)
MPL methodology review
GSO and NGSO forecasts
Waivers for many payloads and other Part 440 Mods
Development of a legal framework for private exploitation and utilization of space resources
Long-term extension of third-party risk-sharing regime
Strengthening of informed consent protection from unrestricted second-party litigation
Inclusion of spaceflight participants in third-party indemnification
NASA termination liability
Telcon Jan 25, 2013 – 50+ participants
Recommendations for organizations to perform MPL review
White Sands Research and Development
Various “cat” modelers – catastrophe risk analysis for the insurance industry
AIR, Eqecat, RMS, etc.
Recommendations forwarded to FAA AST
Finding: COMSTAC finds that FAA AST’s assigned task has been addressed, and remains ready to support further work on the MPL methodology review.
Forecasts completed and ready for issuance
Forecasts show strong near-term growth in NGSO launch activity and steady level of GSO launch activity
Realization factors temper optimistic forecasts; but expanding applications and markets in communications, earth observation, technology demonstration, and human spaceflight drive future growth
Forecasts will be available shortly on FAA AST web site
finding: COMSTAC finds that the annual GSO and NGSO reports are important resources, not just for FAA AST but also for industry and other government agencies. These reports are extensively used for planning and business development throughout the space industry, and should continue to be produced annually.
FAA AST requested COMSTAC’s views on customer flow-down:
Require licensee to sign cross-waivers only with customers that have directly contracted with the licensee.
A customer of a customer contracting with a licensee would sign cross-waiver only with the original customer, not all launch participants
A “second-tier” customer would still have to agree to waive claims against all launch participants, and
The original customer would have to indemnify other launch participants if it failed to obtain such a waiver from the “second-tier” customers
Cross-waiver with no customer
Finding: COMSTAC finds that FAA AST’s work on (a) the customer flowdown issue, pending clarification of the relationships and potential interactions of contractors, customers, and others (e.g., aggregators); and (b) the “clean-up” issues should be pursued.
Commercial vs commercial
Intersection of law, politics and enlightened self-interest
Priority is for interested parties to co-operate
Recommendation: COMSTAC recommends that FAAAST support efforts in Congress and through the Department of State to confirm the right of private sector companies to enjoy the benefits of resources extracted from the surface or subsurface of the Moon and other celestial bodies, subject to appropriate regulationsupervision by a relevant U.S. government entity such as FAAAST.
Finding: COMSTAC finds that, under the current U.S. launch indemnification regime, licensees are required to protect the U.S. government from legal liability up to the maximum probable loss (MPL), at no direct cost to the government, with the expectation that the government will continue to be authorized to seek an appropriation to pay certain excess claims above the MPL, on behalf of all launch participants.
Recommendation: COMSTAC recommends that FAA AST urge Congress to permanently extend the current U.S. launch indemnification regime because it protects the U.S. government from substantial third-party liability claims up to the MPL, at no direct cost to taxpayers.
Observation: COMSTAC observes that, while the Commercial Space Launch Act requires that licensees obtain informed consent from their spaceflight participant customers, it is silent on the issue of does not preclude potential claims from participants and their heirs and estatesin the event of a flight incident or accident.
Finding: COMSTAC finds that, to encourage the successful growth of the commercial space flight industry, operators, manufacturers, suppliers, and other contractors, should enjoy a predictable and consistent legal environment where they can be held accountable for deliberate malfeasance or gross negligence, but not for the inherent risks associated with human spaceflight.
Observation: COMSTAC observes that commercial spaceflight activities legally implicate the federal government because the U.S. is a signatory to international treaties making nation-states liable for certain losses arising from space activities of non-governmental entities.
Finding: COMSTAC finds that cross-waivers of liability among all parties on the licensee side of the launch activity should be required, and Federal courts should decide legal cases regarding any element of the federal license, including the legal validity of anywaiversof claims signed by spaceflight participants, after being fully informed as to the risks of the spaceflight.
Recommendation: COMSTAC recommends that FAA AST work towards modifying CSLA language to specifically include spaceflight participants in third-party indemnification. Spaceflight participants are explicitly excluded from Federal indemnification, and not listed in law as a party to be protected by the licensee’s insurance.
Recommendation: COMSTAC recommends that FAA AST support termination liability reform at NASA in order to protect commercial and NASA programs from being exposed to overly burdensome termination liability costs. Specifically, a reasonable ceiling should be set on termination liability assessments that reflects historic programmatic cancellation rates at NASA.[WITHDRAWN]
Christopher T.W. Kunstadter
Senior Vice President