A new paradigm for arbitrating disputes in outer spaceby Michael Listner
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| Outside of dispute resolution mechanisms incorporated into contracts and diplomatic overtures made on their behalf, non-governmental entities involved in outer space activities have few choices in alternative forums to resolve their disputes. |
The governmental nature of space law and outer space activities in general has created a paradigm where disputes that arise out of space activities are strictly the province of government agencies and diplomats. Disputes that arise in this arena are often dealt with through diplomatic channels and seldom use legal dispute resolution mechanisms to achieve a solution. However, as private commercial interests become more prevalent in outer space activities, space law, both domestic and international, has begun to merge with areas of traditional law including property, contract, and intellectual property.1
As that merger continues, international disputes between governmental entities and non-governmental commercial entities will likely grow as well. The downfall is that outside of dispute resolution mechanisms incorporated into contracts and diplomatic overtures made on their behalf, non-governmental entities involved in outer space activities have few choices in alternative forums to resolve their disputes. However, the legal community has taken notice of this deficiency and addressed it with the adoption of new rules for arbitration keyed specifically for issues arising from outer space activities, both in the context of resolving disputes pertaining to treaties in the diplomatic world and contracts in the private sector.
Dispute resolution past and present
Dispute resolution pertaining to incidents arising out of outer space activities is not a new idea. The Liability Convention of 1972 has built within its precepts an alternative dispute resolution mechanism designed specifically to deal with disputes that arise within its context and cannot be resolved diplomatically.2 In the event that two or more parties involved in a claim for compensation cannot reach agreement as to compensation, Article XIV of the Liability Convention offers an alternative dispute mechanism in the form of the Claims Commission (the Commission).
Article XV through XX of the Liability Convention stipulates the rules and structure of the Commission. These provisions require among other things the following:
- That the Commission be composed of three members with one appointed by the claimant state, one appointed by the launching state and the Claims Commission’s chairman, who is chosen jointly by both the claimant state and the launching state;
- If no agreement is reached between the claimant state and the launching state on the choice of the Chairman within four months of the request for the establishment of the Commission, either party may request the Secretary-General of the United Nations to appoint the Chairman within a further period of two months;
- That the Commission determines the procedure to be used, and the place or places where the proceedings will take place as well as all other administrative matters relating to the resolution of the dispute;
- That all decisions and awards made by the Commission are by majority vote, unless the form of the Commission is such that it has a single member;
- That the Commission will decide the merits of the claim for compensation, and if any compensation is due, the Commission will determine the amount of compensation payable;
- That all decisions of the Commission are final and binding upon the claimant state and the launching state; and
- That the expenses incurred during the course of the arbitration by Commission are to be divided equally between the claimant state and the launching state.
The Commission is intended to fall under the jurisdiction of the United Nations, and it is notable, but not surprising, that the Commission has yet to be called upon to resolve a dispute. The Commission is designed to specifically address situations that arise under one international convention of outer space law, which has been invoked only once, when Cosmos 954 crashed within the territory of Canada. The resulting claim from that incident was resolved diplomatically, and neither party saw fit to request that the Commission be used to resolve the dispute. Although the Commission is limited in its scope, it would likely serve the specific purpose it was intended for if it was ever called upon.
A new paradigm for the present and future
Outside of the dispute resolution mechanism tailored specifically for matters arising under the Liability Convention, there is no other outer-space specific means of alternative dispute resolution for states to turn to. Furthermore, the means for alternative dispute resolution outlined in the Liability Convention is intended for state bodies only and excludes the participation of non-governmental entities.
| The provision of a medium to resolve contract and treaty disputes may have the side benefit of creating an environment conducive for the negotiation and creation of international treaties relating to outer space. |
The Permanent Court of Arbitration (PCA)3 recognized a perceived need for specialized rules of arbitration for matters relating to the rapidly developing area of outer space activities. This led the PCA to initiate a project in 2009 to create a set of rules of arbitration that would meet the specific needs of disputes arising from outer space activities. This project led to the Optional Rules for Arbitration of Disputes Relating to Outer Space Activities (the Rules), which were adopted by the PCA on December 6, 2011. The Rules adopted by the PCA recognize that the scope of outer space activities involve not only the potential for dispute among nations in outer space activities, but disputes among private parties whose activities involve a component of or otherwise involve outer space activities. An exhaustive analysis of the Rules is beyond the scope of this essay, but some of the high points follow.
The Rules are based on the 2010 UNCITRAL Arbitration Rules4 and have been modified to address the particular needs of disputes involving the use of outer space by nations, international organizations and private entities. The Rules accomplish this by:
- Considering the particular nature of disputes that involve the use of outer space by states, international organizations, and private entities, or otherwise having an outer space component;
- Considering the public international law elements that pertains to disputes that may involve states and the use of outer space, and the international practice appropriate to such disputes;
- Establishing the jurisdiction of the PCA to arbitrate a dispute and specifying the authority of Secretary-General of the PCA at The Hague;
- Providing the parties the freedom to choose an arbitral tribunal composed of one, three, or five persons;
- Establishing a specialized list of arbitrators versed in the subject matter of the dispute and a list of scientific and technical experts to address technical issues that may be pertinent to a dispute; and
- Allowing the parties to request that information presented as part of the arbitration, including expert testimony, remain confidential in order to protect propriety information, trade secrets, etc.
Additionally, the Rules also contain language for model contractual language that legal practioners or diplomatic negotiators can modify and insert into contracts or treaties as the case may be. The purpose of this clause is to memorialize in the instrument the intent of the parties to address a dispute or controversy arising from the contract or treaty to be settled by arbitration in accordance with the Rules.
| The current body of international space law is plagued by ambiguity and is essentially unenforceable and virtually the only means of dispute resolution lies in diplomatic maneuvering. |
The significance of the PCA’s adoption of the Rules goes beyond providing a viable forum for alternative dispute resolution for disputes arising from outer space activities. The provision of a medium to resolve contract and treaty disputes may have the side benefit of creating an environment conducive for the negotiation and creation of international treaties relating to outer space.
The current body of international space law is plagued by ambiguity and is essentially unenforceable and, with the possible exception of the Claims Commission provided for in the Liability Convention, the only means of dispute resolution lies in diplomatic maneuvering. In a diplomatic environment skewed by soft power, the likelihood is slim of resolving a dispute equitably. If the Rules prove be effective, they could provide an apolitical forum for states to effectively resolve disputes relating to outer space. Including the stipulation in a treaty that the Rules be used to resolve disputes could provide states with the confidence to negotiate legally binding treaties relating to outer space activities, knowing that in the event of a dispute their grievances would be addressed impartially.
Likewise, non-governmental, private entities could find equal confidence in negotiating international contracts by relying on the Rules for dispute resolution. Private international agreements relating to outer space activities, such as the launch and operation of a satellite, could be negotiated in confidence that should a dispute arise that grievance would find a competent, impartial solution.
Conclusion
The realm of outer space activities has grown significantly since the beginning of the space age. As technology makes outer space more accessible, the legal regime surrounding it will grow as well. Disputes are part of that growth and the Rules are a step forward in the present to address future growth. Whether they will be able to accommodate that growth and prove to effective will be known only once the governmental and non-governmental parties that they are intended for begin to utilize them.
Endnotes
1 For example, Congress passed 35 U.S.C. § 105: Inventions in Outer Space, which extends the definition of “patent infringement” to extend to acts in outer space on “space objects” or “components thereof” under the jurisdiction of the United States. See Theodore U. Ro, Matthew Kleiman and Kurt Hammerle, “Patent Infringement in Outer Space in Light of 35 U.S.C. § 105: Following the White Rabbit Down the Rabbit Loophole”.
2 Article IX of the Liability Convention requires that “[a] claim for compensation for damage shall be presented to a launching State through diplomatic channels. If a State does not maintain diplomatic relations with the launching State concerned, it may request another State to present its claim to that launching State or otherwise represent its interests under this Convention. It may also present its claim through the Secretary-General of the United Nations, provided the claimant State and the launching State are both Members of the United Nations.”
3 The Permanent Court of Arbitration (PCA) is an intergovernmental organization with one hundred and thirteen member states who have acceded to its founding conventions. The PCA was established through the 1899 Convention for the Pacific Settlement of International Disputes and the 1907 Convention for the Pacific Settlement of International Disputes. The PCA’s purpose is to facilitate arbitration and other forms of dispute resolution between states. It has developed into a modern, multi-faceted arbitral institution that is positioned at the intersection between public and private international law to meet the developing dispute resolution needs of the international community. The PCA offers a forum for the resolution of disputes involving various combinations of states, state entities, intergovernmental organizations, and private parties.
4 The United Nations Commission on International Trade Law (UNICITRAL) is the core legal body of the United Nations dealing with rules of commercial international law. The UNCITRAL Arbitration Rules were adopted in 1976 with subsequent revisions. The 2010 Arbitration Rules reflect the latest revision.