The space industry—whose numbers are already substantial— has undeniable potential for further growth. However, because it no longer consists of only multibillion-dollar companies, the industry needs access to traditional financing. Venture capital alone is insufficient. This Article discusses some difficulties for the space industry’s access to traditional—and especially asset-based—financing. Some are common to all space activities, while some exist only for novel space activities. These difficulties cover a broad range of legal, regulatory, and factual issues (including insurance). While the problems are difficult, ideas to solve them are plentiful, a number of which the paper discusses. The paper also presents ways in which the industry can do much to advance its own interests. In addition, actions by governments, both at the domestic and the international level, are recommended.

More here: Francesca Giannoni-Crystal, Asset-Based Financing For Space Activities, 89 J. Air L. & Com. 33 (2024), available at https://scholar.smu.edu/jalc/vol89/iss1/3/

TABLE OF CONTENTS

I.  INTROduCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . 

II. SPACE COMPANY FINANCING: THE WAYS SPACE COMPANIES ARE CURRENTLY FINANCED AND LIMITATIONS . . . . . . . . . . . . . . . 

III.THE HURDLES FOR SPACE COMPANIES TO OBTAIN ASSET-BASED FINANCING . . . . . . . .

A. common Hurdles to Financing of space Companies . . . . . . . . . . . . . . . . . . . . . . . . . . 

1. Intellectual Property Issues . . . . . . . . . . . . . . . . 

2. The Problem of Perfecting Security Interests . . . .

i. uniform Commercial Code Article 9 . . 

ii. The Problem of the Location of the Debtor . . . . . . . . . .

iii. The Problem of the Location of the Collateral . . . . . . . .

iv. Solutions . . . . . . . . . . . . . . . . . . . . . . 

3. The Importance of Insurance in Financing . . . . 

B. some Additional Problems for new Space Activities . . . . . . . . . . . . . . . . . . . . . . .

1. Legal Uncertainty Surrounding Some Space Activities. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 

2. The Problem of Frequencies for New Space Activities. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 

3. Lack of a Clear Licensing Framework at the Domestic Level. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 

IV. ACTIONS BY THE SPACE INduSTRY . . . . . . . . . . . 

A. industry Practice to Shape the Law . . . . . . . . . . 

B. use of Technology: Blockchain . . . . . . . . . . . . . 

V. CONCLUSION . . . . . . .