Commercial exploitation of lunar resources by private entities may commence as early as April 2023, and Japan is most likely to take the pioneer’s crown. A Japanese company named ispace has designed, built, and launched a robotic spacecraft named HAKUTO-R, which is already orbiting the moon (as of March 21, 2023). A successful lunar landing and regolith collection by a private company will be a major milestone in the new space race between the U.S. and their Artemis Accords allies on one side, and China and Russia on the other. The event may also alter the development of international space law. The business plan of ispace has been licensed by the Japanese government under its national space law, a practice considered dubious by some space lawyers. At this moment, there is no universally recognized legal regime for space resources exploitation, the current body of international space law is scant and thus subject to conflicting interpretations.
Mining the Final Frontier
The rapid development of technology in the 20th century made it possible to extract minerals from the areas that were previously inaccessible to humanity. First, the continental shelf, then the deep seabed (the oceanic floor) and finally – the celestial bodies in outer space, such as planets, moons, asteroids, and comets. American manned missions to the moon (Apollo), as well as unmanned lunar missions by the Soviet Union (Luna) and China (Chang’e) returned a certain amount of lunar regolith to Earth. Japanese spacecrafts Hayabusa and Hayabusa-2 managed to extract samples from asteroids Itokawa and Ryugu, respectively. NASA OSIRIS-REx spacecraft is also on its way back to Earth carrying samples from asteroid Bennu. Nevertheless, all the abovementioned missions were scientific and exploratory activities by government space agencies without any commercial purpose. Thus, the extraction of real profits from the moon and asteroids is yet to come.
Geological research shows that the moon contains many valuable elements, including uranium, thorium and titanium,[1] as well as platinum-group metals – platinum, palladium, osmium, and iridium, which are highly valuable in medical and power technologies.[2] However, the most precious resource of the moon may be Helium-3. 370 metric tons of this isotope may be enough to supply humankind with energy for an entire year.[3] Venture entrepreneurs have been trying to launch startups specializing in space mining as early as 2009, but none of them managed to create a profitable business model yet. Despite the bankruptcy and failures of the first generation of “space miners,” a new generation of startups has emerged. Currently, Japan’s ispace may be the closest candidate to proceed to the implementation stage.
HAKUTO-R robotic spacecraft was launched from Cape Canaveral on SpaceX Falcon 9 rocket in December 2022. It has already accomplished 7 out of 10 milestones of its mission. If everything goes as planned, the lunar landing will be complete in late April 2023.
From the point of international space law, the most important part of ispace Mission 1 will be the collection of lunar regolith. The company’s engineers expect the regolith to be deposited on the lander’s footpads. After that, ispace will transfer the ownership rights over this material to an unspecified client or clients. This is how ispace business activities plan describes the procedure:
The regolith deposited on the footpad is photographed by the camera mounted on the spacecraft. ispace confirms the existence of deposited regolith by photographed images, and conducts a commercial transaction to transfer the ownership of the regolith from ispace to the customer before implementing the operation termination measure. It does not involve physical delivery during operation.
The question that puzzles space lawyers – is such a transaction permissible under the current body of international law? Can a private company take a portion of minerals from a celestial body and then sell it for profits? The current body of space law does not give a comprehensive answer.
Space Mining and International Law
Just like the outer space, deep seabed (legally called “the Area”) is an area beyond national jurisdiction. The exploitation of the Area’s mineral resources is regulated by the 1982 United Nations Convention on the Law of the Sea and the 1994 Implementation Agreement. Therefore, there is a legal regime and an international body – the International Seabed Authority – that every state or company must obey if they wish to mine the Area. At the same time, there is no such regime and no such body to govern space mining.
The main source of international law in regard to space activities is the 1967 Outer Space Treaty. Articles I and II of the Treaty declare outer space “province of all mankind” and prohibit national appropriation of the moon and other celestial bodies. Article I paragraph 2 also allows free exploration and use of outer space by all States and grants them access to all areas of celestial bodies. In sum, the Treaty designates outer space as a res communis (global commons)area beyond national jurisdiction, but does not place any concrete limitations on states’ activities in regard to the exploration and exploitation of space resources.
The Outer Space Treaty was drafted at the dawn of the space era, so it only needed to establish general principles of international space law. The subsequent space treaties were expected to provide more detailed regulations, including those of space mining. This was attempted by the 1979 Moon Agreement. Article 11(1) of the Agreement designates the moon and its resources as the “common heritage of mankind,” while paragraph 3 of the same article states that “neither the surface nor the subsurface of the moon, nor any part thereof or natural resources in place, shall become property of any State, international intergovernmental or non-governmental organization, national organization or non-governmental entity or of any natural person.” Article 11 allows free exploration and use of the moon, but it is not clear whether the term “use” includes exploitation of the moon’s natural resources, especially for commercial purposes. Paragraph 5 of Article 11 attempts to introduce more clarity: “States Parties to this Agreement hereby undertake to establish an international regime, including appropriate procedures, to govern the exploitation of the natural resources of the moon as such exploitation is about to become feasible.”
Japan’s ispace is trying to prove the exploitation is already feasible, but no international regime has been concluded yet. Moreover, only 18 states have ratified the Moon Agreement, and the U.S., China, Russia, or Japan are not among them. Even though the Moon Agreement officially entered into force in 1984, its provisions cannot be considered part of customary international law due to its lack of recognition, and there is hardly any state or scholar arguing the opposite.[4] Therefore, when it comes to space mining, the 1967 Outer Space Treaty remains the only source of international law.
There is no doubt that small portions of space resources can be recovered for scientific purposes, but does the Outer Space Treaty permit commercial exploitation of the moon and asteroids? International lawyers have two views. First, even though a limited use for scientific purposes is allowed, a large scale utilization for commercial purposes is inconsistent with the Outer Space Treaty.[5] Second, non-appropriation regime applies only to in situ resources, i.e. resource in place, not yet extracted. Once removed from their original location, they can be appropriated.[6] Fabio Tronchetti and Hao Liu argue that since the Treaty does not expressly prohibit the commercial use of resources, such an activity should in principle be permissible. However, they also suggest that the “global commons” area should rather be jointly managed by all states and not only those states that have technical capabilities.[7] In the absence of such joint management, certain developed states decided to take unilateral actions to regulate the exploitation of space resources through their national legislation. One of these states is Japan.
National Licensing of Space Mining
The practice of licensing space mining has been pioneered by the United States and later three of its partners within the Artemis Accords framework. The United States enacted its Commercial Space Launch Competitiveness Act (CSLCA) in 2015, and then elaborated its position in the 2020 Executive Order by President Trump. CSLCA provides that
A United States citizen engaged in commercial recovery of an asteroid resource or a space resource under this chapter shall be entitled to any asteroid resource or space resource obtained, including to possess, own, transport, use, and sell the asteroid resource or space resource obtained in accordance with applicable law, including the international obligations of the United States.
Trump’s Executive Order goes further stating that
Americans should have the right to engage in commercial exploration, recovery, and use of resources in outer space, consistent with applicable law. Outer space is a legally and physically unique domain of human activity, and the United States does not view it as a global commons. Accordingly, it shall be the policy of the United States to encourage international support for the public and private recovery and use of resources in outer space, consistent with applicable law.
The 2015 CSLCA was followed by the adoption of similar laws in Luxemburg (2017), the United Arab Emirates (2020), and Japan (2021). All of these laws establish licensing mechanisms to permit their citizens and companies to extract space resources. None of these states sees their legislative activity as contradicting international law, but there other major powers who do. In 2018, Russia accused the U.S. and Luxembourg of “presenting a de facto new reading of the fundamental norm prohibiting national appropriation of outer space, including the celestial bodies.”[8] Certain scholars of international law also believe that the new licensing mechanism violates the non-appropriation principle of the Outer Space Treaty.[9] If a state endorses the rights of its nationals to own the resources extracted from space, it must own these resources in the first place. In other words, property rights can only be granted by a sovereign. However, that is legally impossible, since outer space and celestial bodies belong to the entire humanity, and no state can claim sovereignty over any part of them.
It is unlikely that the U.S. and their allies will back down and admit their new legislation was a mistake. Nor would they withdraw from the Outer Space Treaty – they still insist that they follow its provisions in good faith. Instead, they may try to shape the development of international space law in their own favor. This will be done through both interpretation and state practice.
A New Era of Space Law?
The first commercial transaction of mineral resources extracted from a celestial body will change the history of international space law into “before” and “after.” First, it will be an important precedent to reinforce the vision propagated by the United States and their allies. According to Article 31 of the 1969 Vienna Convention on Law of the Treaties, interpretation of a treaty depends on the subsequent agreements between the parties “regarding the interpretation of the treaty or the application of its provisions,” or the parties’ “subsequent practice in the application of the treaty.”[10] First, the Artemis Accords establish a “mini legal regime within the broader legal framework of the Outer Space Treaty”[11] and promote such an interpretation of the Treaty that permits commercial exploitation of space resources. Second, the actual recovery of space resources by private entities, such as ispace, contributes to the formation of a new legal custom. Actions of these private entities are legally endorsed by their governments, and states also bear international responsibility for the actions of their nationals in space according to Article VI of the Outer Space Treaty. Therefore, space mining by private entities can be regarded as a state practice. In turn, a repeated and generally unified state practice is the first step towards the formation of customary international law.
The members of the United Nations Committee on Peaceful Uses of Outer Space (COPUOS) fully understand the challenge posed by a rapidly evolving space economy. Thus, they have created a Working Group on the Legal Aspects of Space Resource Activity and gave it a five-year mandate to assess the situation and possibly develop additional international governance instruments. It is not certain whether COPUOS will draft any new treaty (or at least a set of guidelines) for space mining regulation by 2027. Even if such a result will be produced, there will be at least two obstacles in its way. First, major spacefaring nations may refuse to sign and ratify a new binding international treaty, just like they ditched the 1979 Mood Agreement. Second, if it is a soft law instrument (e.g. code of conduct, guidelines, principles, UN General Assembly resolution), its provisions will not be binding, so the states will be able to ignore them if they wish. At the same time, the moon (and other deep space areas) may start getting congested, contested, and competitive just like the Earth’s orbit, while private entities will have to operate in a state of legal uncertainty.
[1] E. Robens et al., “Investigation of Surface Properties of Lunar Regolith Part II,” Journal of Thermal Analysis and Calorimetry 94, no. 3 (2008): 627.
[2] Fabio Tronchetti, “Legal Aspects of Space Resource Utilization,” in Research Handbook in Space Law, ed. Frans von der Dunk and Fabio Tronchetti (Cheltenham: Edward Elgar Publishing, 2015), 771.
[3] Tronchetti, “Legal Aspects of Space Resource Utilization,” 771.
[4] Fabio Tronchetti and Hao Liu, “The White House Executive Order on the Recovery and Use of Space Resources: Pushing the Boundaries of International Space Law?” Space Policy 57 (2021): 5.
[5] Hao Liu and Fabio Tronchetti, “Should the Red Dragon Arise? Assessing China’s Options vis-a-vis the Enactment of a Domestic Space Resources Utilization Law,” Space Policy XXX (2017): 2.
[6] Liu and Tronchetti, “Should the Red Dragon Arise?” 2.
[7] Tronchetti and Liu, “The White House Executive Order,” 2.
[9] Harris A. Durrani, “Interpreting “Space Resources Obtained”: Historical and Postcolonial Interventions in the Law of Commercial Space Mining,” Columbia Journal of Transnational Law 57 (2019): 439.
[10] Vienna Convention on Law of the Treaties, 23 May 1969, art. 31(3).
[11] Tronchetti and Liu, “The White House Executive Order,” 5.
