How might the EU Space Act affect businesses?

The EU Space Act is a newly proposed initiative by the European Commission aimed at enhancing the competitiveness of the EU space industry, while safeguarding existing EU objectives such as sustainability, resilience, and safety. These three principles—sustainability, resilience, and safety—form the core pillars of the EU Space Act.

Although the legislation is still in its early stages, global interest in space exploration has surged once again. Countries including China, Russia, and the United States have announced intentions to build nuclear reactors on the Moon by the 2030s. The deployment of satellites and devices containing nuclear components raises serious concerns about space debris, particularly in cases of equipment failure where debris cannot be effectively managed.

The EU remains committed to its European Green Deal and broader sustainability goals, and aims to ensure that EU-based businesses operating in the space sector align with these priorities. However, similar to other regulations such as the General Data Protection Regulation (GDPR) and the EU Artificial Intelligence Act (EU AI Act), the EU Space Act includes an exemption for defence and military activities. According to the draft proposal, the Act “should not apply to space objects that are exclusively used to enable defence or national security objectives, irrespective of the entity carrying out such space activities.” (See: Draft Proposal, page 19).

As the EU Space Act continues to be debated, certain provisions in the draft may be subject to revision. Nevertheless, businesses involved in the aerospace industry should closely monitor the legislative timeline and prepare for potential regulatory impacts.