Headline Feb 11, 2015/ ''' SPACE TECHNOLOGY - IN NAKED RED TAPE '''



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IN THE RECENT years, commercial space startups have proposed everything from asteroid mining and lunar space-elevators to home made satellites and private moonshots.

Gravity, however, is not the only force preventing them from achieving  Lift-off.

Although the cost of developing new space vehicles, products and services is high, just as much of a burden can be imposed by such intangible expenses as regulatory compliance, legal fees and insurance premiums.

Art Dula, boss of  Excalibur Almaz, a British firm touting trips to the moon aboard second-hand Russian spacecraft, says that so far- 

His company has spent as much on navigating the legal and regulatory paperwork as it has on buying and refitting its Soviet-era space capsules for lunar orbit.  

The first obstacles facing any  astropreneur, in the West at least, are America's International Traffic in Arms Regulations, known as ITAR. 

Like guns and tanks, almost all rocket systems and space components require a license for export. This includes shipping them abroad, but a license is also needed if components are worked on, or merely shown to, a non-American.

Tight  ITAR  controls on commercial satellite technology are reckoned to have almost halved American satellite manufacturers global market share since 1999.

Space-tourism firms may even need export licenses to carry foreign passengers on sub-orbital spaceplanes.

Virgin Galactic, one such firm which went on  to start operations in Mexico, received an exemption from  ITAR  by designing its procedures so that passengers do not see what happens behind scenes.

But ITAR seems likely to complicate the company's long-term plan to launch from a spaceport in Abu Dhabi.

Insurance is another consideration, Launching a rocket remains a risky business and insurers typically charge around  10%  of the replacement value for payloads headed to orbit, a cost that can top $50 million for sophisticated satellites.

There is also the risk of going awry and damaging bystanders and property. Only twice have significant third-party  claims been made:

Around $1.2 million by damage caused by the break-up of Columbia space shuttle on re-entry in 2003, and $30 million after the explosion of a rocket carrying a satellite that devastated an American car park in 1997, luckily with no injuries.

Governments require private launches to carry substantial liability cover. Although premiums are relatively low, starting at around $275,000 for $100 million of cover, this has been enough to discourage some start-ups and academic researchers.

Space-tourism ventures note that their vehicles are lighter and smaller and will fly in less populated areas than commercial jets, which typically incur insurance costs of just a few thousand dollars per trip.

Larger rockets launched in the United States benefit from federal indemnification that limits their exposure in the event of a truly catastrophic accident. The Federal Aviation Administration (FAA)  demands insurance:

Sufficient to cover its calculations of a maximum probable loss, averaging around $100 million per launch. Any losses beyond that , up to around $ 2.7 billion, would be footed by the American taxpayer.

This indemnification is subject to regular renewal, however, and is due to expire at the end of the year.

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