U.S. Launch Liability Shield Renewed for Three Years

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The U.S. government will continue to shield commercial space launch providers from liability for catastrophic events during the next three years under a bill U.S. President Barack Obama signed into law Dec. 28, 2009. The measure requires the federal government to indemnify commercial launch operators against third-party claims for launch-related damages that exceed $500 million, up to a total of $1.5 billion. After the $1.5 billion threshold is reached, the liability reverts to the commercial launch operator.

First established by Congress as part of the Commercial Space Launch Act Amendments of 1988, the commercial space transportation risk-sharing liability and insurance regime has been extended four times. With the previous extension expiring Dec. 31, 2009, the U.S. House of Representatives in October approved a new three-year extension of the liability protections.

During a mid-December executive session of the Senate Commerce Committee, Sen. John “Jay” Rockefeller (D-W.Va.), the panel’s chairman, said the legislation would help U.S. commercial space firms compete globally.

“Normally I’m not one who supports indemnifying the private sector for liability, but I recognize that our commercial space industry needs this federal protection in order to compete with others around the globe,” said Rockefeller, whose committee approved the legislation Dec. 17. “Today’s legislation extends that liability for another three years, that is until December 2012, and I expect we will reassess the market before that time to see if the commercial space industry is ready to assume full risk and responsibility.”