The European Union ("EU") has identified the space industry as a key strategic sector, projecting its total value to reach USD 1.8 trillion by 2035.1 The proposed EU Space Act (the "Act") seeks to establish a unified EU-wide legal framework for this rapidly expanding sector, including harmonised standards for safety, resilience, and environmental sustainability. This initiative is central to the EU's broader objective of boosting the competitiveness and strategic autonomy of its space sector. However, the Act's extraterritorial scope and regulatory features may pose cross-jurisdictional compliance challenges for space operators, and create friction with other space-faring nations, notably the United States.
Background
On 25 June 2025, the European Commission published its proposal for the EU Space Act.2 First announced in 2023, the proposed Act would be the EU's first regulation to govern the space sector in a comprehensive manner. The Act is part of the EU's broader strategy to achieve greater independence in strategic domains, including space. As such, it aims to foster the growth of the EU space sector and reduce its reliance on third-country entities by replacing divergent national rules with harmonised EU-wide standards, centralised governance, and level the playing field with non-EU space service providers.
The proposal has been accompanied by increased public spending on space. For example, in November 2025, the European Space Agency, whose members comprise most of the EU Member States, plus Norway, Switzerland, and the United Kingdom, obtained its largest ever budget commitments totaling approximately EUR 22.3 billion (a 31% increase),3 and, in December 2025, the European Commission allocated EUR 50 million to a space project under the European Defence Fund's EUR 1 billion work programme for 2026. For 2026-2027, at least 10% of the European Defence Fund's budget is earmarked for space projects.4
At the same time, the market for space assets and services is transforming rapidly. Recent developments include the announcement by three major European aerospace and defence companies of the planned creation of a European space champion.5 Governments and consumers are relying more and more on commercial space service providers, where US industry has taken the lead. The United States' critical response to the Act indicates that the market and regulatory framework for space activities is becoming an increasingly contested environment.6 Accordingly, businesses and governmental agencies active in space – whether based inside or outside the EU – should assess the Act's impact on their operations.
Scope of the Act
The Act would apply whenever space-based services or data are provided within the EU, irrespective of the provider's location or whether the provider is a private or public entity. Four categories of space service providers ("SSPs") are covered:
- Space operators (entities operating spacecraft, launches and launch sites, or providing in-space services);
- Primary providers of space-based data (e.g. initial processors of observation data);
- International organisations; and
- Collision avoidance service providers.
Certain activities would be exempt from the Act's scope, notably those related to space assets used exclusively for defence or national security. Dual-use objects also would be excluded when under military control. A lighter regulatory regime would apply to small- and medium-sized enterprises.
Authorisation requirement
Under the proposed Act, space services within the EU may not be provided without authorisation. To obtain authorisation, SSPs would need to demonstrate compliance with the Act's core technical rules. The Act would harmonise the authorisation regime for space activities, yet the granting authority would differ for EU and third-country SSPs:
- EU SSPs and their subsidiaries: Authorisations would be granted by the competent authority of the EU Member State where the SSP is established or operates. For assets owned by the EU (e.g. Copernicus), the European Commission would be the granting authority.
- Third-country SSPs: The European Commission would be the granting authority. Third-country governmental bodies seeking to provide space services within the EU would be subject to additional security vetting, in which the EU Agency for the Space Programme ("EUSPA") would participate.
The Commission may issue equivalence decisions for third countries with comparable rules. SSPs from such countries would be authorised to provide space services in the EU subject to the conditions set forth in the equivalence decision and ongoing supervision by their national regulatory authorities.
In exceptional circumstances, such as where no EU substitute is available, the EU Member States may request that the Commission issue a derogation allowing third-country SSPs, which do not meet the Act's core technical rules, to provide space services within the EU.
Authorised SSPs would be registered in a Union Register of Space Objects managed by the EUSPA. Proof of registration and compliance would be certified by an e-certificate, which will be a mandatory part of contracts for the provision of space services or space-based data in the EU.
Technical rules
The proposed Act sets forth three core sets of technical rules addressing safety, resilience, and environmental sustainability. These are detailed in the Act's annexes and subject to future elaboration in delegated acts to be issued by the European Commission.
Safety
The Act would establish minimum safety standards for launchers and spacecraft. These include rules for selecting orbits, tracking space objects, mitigating the risks of collision and space debris, disposing of satellites at the end of their life, and sharing satellite position data. Additional rules and reporting obligations would apply to satellite constellations.
Resilience and cybersecurity
The Act's rules would seek to ensure the resilience of space activities in the areas of cybersecurity and risk management by creating minimum standards for encryption, incident detection, and supply chains (among other things), complementing the existing EU cybersecurity and resilience legislation.7 The rules would require SSPs to assess and manage cybersecurity risks and to conduct risk assessments throughout the life cycle of a space mission.
Environmental sustainability
Under the Act, SSPs would need to calculate the environmental footprint of their space activities, obtain a certification of the calculation by a technical body, and submit the certified calculation with their application for the space services authorisation. The Act would also create a common database for environmental footprint data.
Governance
Responsibilities for the administration and enforcement of the Act would be divided among the EU Member States, the EUSPA, and the European Commission.
- The EU Member States' national competent authorities would authorise and supervise EU SSPs and have investigative and corrective powers, from conducting on-site inspections and searches to imposing fines. The national competent authorities would also be tasked with supervising Qualified Technical Bodies designated by the EU Member States to support the administration of the Act's technical rules.
- The EUSPA would supervise operators of EU-owned assets and third-country SSPs, and assess their compliance with the Act's technical rules. The EUSPA's decisions would be taken by a Compliance Board composed of representatives of the EU Member States and the European Commission. The Compliance Board's decisions would be subject to appeal before a Board of Appeals. The EUSPA also would manage the Union Register of Space Objects.
- The European Commission would authorise third-country SSPs and operators of EU-owned assets based on technical assessments provided by the EUSPA, and have investigative and corrective powers with respect to such SSPs, including conducting on-site inspections within and outside of the EU territory and imposing fines of up to 2% of the annual global turnover.
Interaction with non-EU space regulatory regimes and policies
The Act's broad reach and extraterritorial scope may conflict with the space regulatory regimes and policies of non-EU countries. The United States, for example, has criticised the Act for imposing "unacceptable regulatory burdens on US providers of space services to European customers", and indicated that it considers that the Act introduces non-tariff barriers in areas such as "space weather, remote sensing, space exploration, spaceflight safety, space debris mitigation and remediation, communications, as well as cooperation with the European Space Agency", contrary to the United States-EU trade framework agreement agreed on 21 August 2025.8
These developments underscore that space operators, including those based outside of the EU but whose services have an EU connection, might be subject to conflicting space regulations, and policies and should carefully assess the Act's implications, including with respect to other, non-EU regulatory regimes within which they operate.
Key considerations
- The Act would establish a new field of EU space regulation from 2030, requiring SSPs and suppliers to prepare for compliance well in advance, or risk exclusion from the EU space market. Given its broad scope, any SSP – whether based inside or outside the EU – whose activities are connected in some way to the EU market would likely be subject to the Act's registration, authorisation, and compliance requirements.
- The Act's potential conflicts with non-EU regulatory regimes mean that SSPs must consider cross-jurisdictional compliance.
- Third-country SSPs that do not already hold an EU Member State authorisation would need to obtain an authorisation from the European Commission, and designate a legal representative located within the EU.
- Third countries seeking to maintain or secure access for their industries to the EU space market may want to seek alignment with the Act's requirements with a view towards obtaining an equivalence decision from the European Commission.
Timing
Before it can be adopted and entered into force, the Act is subject to the ordinary legislative procedure, requiring approval by both the European Parliament and the Council.
In December 2025, the Danish Presidency of the Council issued a compromise text reflecting the state of negotiations among EU Member States in late 2025.9 This text does not revise the European Commission's legislative proposal, and negotiations among EU Member States, are still ongoing within the Council's Working Party on Space. On 9 December 2025, the EU Member States' Ministers held a debate on the proposal during the Competitiveness Council, broadly endorsing its objectives while calling for greater clarification and simplification.10
On the European Parliament's side, the file was referred to the Committee on Industry, Research and Energy (ITRE) as the committee responsible, while the Committee on Internal Market and Consumer Protection (IMCO) and the Committee on the Environment, Public Health and Food Safety (ENVI) were designated to provide opinions. The final committee report has not yet been adopted, and the Plenary of the European Parliament has not established its first-reading position.11
The legislative process may result in significant changes to the Act. Its adoption is not expected to occur before late 2028. If adopted, the Act would apply from 1 January 2030, with a two-year transitional period for certain elements.
Kate Malone (Legal Trainee, Brussels) and Thales Lemos (Legal Trainee, Brussels) contributed to the development of this publication.
1 The Future of European Competitiveness: Report by Mario Draghi, In-Depth Analysis and Recommendations (Part B), pp. 172-173, available here.
2 European Commission, Proposal for a Regulation of the European Parliament and of the Council on the Safety, Resilience, and Sustainability of Space Activities in the Union, 25 June 2025, available here. Annexes are available here. An updated draft of the Act of 5 December 2025 is available here.
3 European Space Agency press release No. 79-2025, available here.
4 European Defence Fund Work Programme 2026, available here.
5 Airbus, Leonardo and Thales Sign Memorandum of Understanding to Create a Leading European Player in Space, 23 October 2025, available here ("[T]his new company will pool, build and develop a comprehensive portfolio of complementary technologies and end-to-end solutions, from space infrastructure to services (excluding space launchers). It will accelerate innovation in this strategic market, in order to create a unified, integrated and resilient European space player, with the critical mass to compete globally and grow on the export markets.").
6 Comments of the United States of America on the Proposed EU Space Act, 20 November 2025, available here.
7 The Act's cybersecurity risk management measures extend beyond those set forth for essential or important entities in Directive 2022/2555 (NIS-2 Directive). For SSPs falling within the scope of Directive 2022/2557 (Critical Entities Resilience Directive), the Act's resilience rules would apply in addition to the Directive.
8 Comments of the United States of America on the Proposed EU Space Act, available here.
9 Council of the European Union, Presidency compromise text, 5 December 2025, available here.
10 Council of the European Union, Competitiveness Council (Research and space), 9 December 2025, available here.
11 European Parliament Legislative Observatory, Procedure file on the proposed regulation on safety, resilience and sustainability of space activities in the Union, available here.
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