The Space Industry Act 2018 (the 2018 Act) was introduced to enable spaceflight activities from the United Kingdom, such as operating a satellite in orbit and enabling launch to orbit from spaceports in the United Kingdom, for the first time. Such activities require a licence.
	International law, particularly UN space treaties, places obligations and responsibilities upon states for activities in outer space. In particular, UN space treaties make provision for the liability of states for damage or injury caused by their space activities. To mitigate against potential claims on the UK Government, section 36 of the 2018 Act requires the holder of a spaceflight operator licence to indemnify the Government and a number of named public bodies. However, this is subject to any limit on the amount of the operator’s liability specified in the licence except in prescribed circumstances such as where the operator is liable in respect of gross negligence or wilful misconduct. Currently section 12(2) of the 2018 Act provides that an operator licence "may" specify a limit on the amount of a licensee’s liability to indemnify under section 36.
	Through responses to a  consultation on spaceflight liability, insurance and charging consultation on spaceflight liability, insurance and charging 1 , the Government is aware that holding unlimited liabilities could be a barrier to conducting spaceflight activities from the United Kingdom. Other launching nations limit liabilities or provide a state guarantee for spaceflight activities conducted from their territory.
	Current Government policy is that all spaceflight licences will include limits on the amount of an operator’s liability to indemnify under section 36 of the 2018 Act and the amount of insurance they are required to hold, so that no operator will face unlimited liability. This Act provides industry with legal certainty that the amount of an operator’s liability will be capped, by making it mandatory to cap the amount of liability to indemnify under section 36.
Policy background