EU Space Law Reform: What the New Framework Means for Industry

A Landmark Regulatory Moment

On 28 March 2026, the European Commission published its long-awaited proposal for a Regulation on Space Activities in the European Union. This is the first attempt to create a unified legal framework for space operations across all 27 member states — replacing the current patchwork of national laws that has created compliance headaches for operators working across borders.

The proposal has been years in the making. It draws on extensive consultations with industry, national space agencies and international partners, and represents a fundamental shift in how Europe governs commercial space activities.

Key Provisions

Unified Licensing Framework

The centrepiece of the proposal is a single EU licence for space operations, replacing the current system where operators must obtain separate authorisations in each member state where they have activities.

Key features of the unified licence:

• Single application point through the operator's "home" member state
• Mutual recognition of the licence across all EU member states
• Standardised safety and liability requirements regardless of where the operation is conducted
• Maximum processing time of 90 days from complete application to decision

Orbital Debris Requirements

The proposal introduces mandatory debris mitigation requirements for all EU-licensed operators:

• 25-year deorbit rule for LEO operations (aligned with current international guidelines, but now legally binding)
• Casualty risk threshold of 1 in 10,000 for uncontrolled re-entries
• End-of-life disposal plan required at licensing stage
• Financial guarantee for debris removal in case of operator failure

For the first time, debris mitigation moves from voluntary guidelines to enforceable law in Europe. This is a significant step, and one that European operators have broadly welcomed — provided the requirements are applied equally to non-EU operators serving the EU market.

Third-Party Liability

The liability framework has been one of the most debated aspects of the proposal. The final text includes:

• Mandatory insurance with minimum coverage of €100M for LEO operations and €200M for GEO operations
• Strict liability for damage caused on the ground or to aircraft in flight
• Fault-based liability for damage caused in outer space
• Government backstop for claims exceeding insurance coverage, funded by a small levy on licensed operators

Data and Transparency

The proposal includes provisions on space situational awareness data sharing:

• Operators must share tracking data with the EU Space Surveillance and Tracking (SST) partnership
• Standardised data formats for conjunction assessments
• Mandatory notification of planned manoeuvres to the EU SST operations centres

What This Means for Operators

For Large Operators

Major European satellite operators and launch service providers will benefit from regulatory simplification. The single licence replaces what has been, in some cases, a six-country compliance exercise for pan-European operations.

For Startups and SMEs

The standardised framework removes a significant barrier to market entry. Under the current system, a startup launching from one member state with ground stations in three others needed to navigate four different regulatory regimes. The new framework reduces this to a single process.

For Non-EU Operators

Any operator providing services within the EU market will need to meet equivalent safety and debris mitigation standards. This "market access" provision is controversial but reflects the Commission's determination to create a level playing field.

Timeline

The legislative process is expected to follow this timeline:

• May–September 2026: European Parliament first reading and committee review
• Q4 2026: Council of the EU working group discussions
• Q1–Q2 2027: Trilogue negotiations
• Q3 2027: Expected adoption
• 2029: Entry into force (with 18-month transition period)

Industry Reaction

Initial industry reaction has been cautiously positive. The European Space Industry Association (Eurospace) welcomed the harmonisation objective while flagging concerns about the liability provisions and the timeline for implementation.

The coming months of parliamentary and council review will determine whether the final text maintains the balance between regulatory clarity and operational flexibility that industry needs.