Implementing effective regulation is an important enabler for managing many of the risks in the space industry. However, as seen with other sectors that are reliant on new or rapidly evolving technology, the pace of technological development in the industry is likely to outstrip the speed at which effective regulation can be introduced.

In the case of space tourism, which is an emerging market, nations are taking different approaches to regulation, with their approach often being driven by domestic drivers and policy. As nations develop their own regulatory regimes, they will seek to balance competing outcomes, including support for innovation, safety, global competitiveness, and sustainability. The traditional industry view is often that tighter regulation can be used to improve safety, but it also has the potential to increase red tape and costs, which can impact commercial competitiveness.

In the US, the ‘informed consent’ regime has come under criticism for failing to ensure that space flight participants (including space tourists) really understand the risks they face, and policy decisions (such as the extension of the legislative moratorium preventing FAA regulation of the design or operation of launch vehicles to protect the health and safety of crews and space flights participants) can intentionally hinder regulatory advances.

In the UK, the Space Industry Regulations intentionally limit the licensing of UK commercial human spaceflight to brief sub-orbital flights (such as Blue Origin and Virgin Galactic's current flight operations). This approach in the UK is understandable given the extent and current nature of the space tourism industry in the UK; however, as the space tourism industry develops and new industries and services grow (such as hypersonic or other point to point transport), there will be a greater number of space flight participants spending more time in space and we would expect the regulations to be developed to promote the safety of space tourists.

Inconsistent international regulatory regimes may well result in ‘jurisdiction shopping’ for operators, as operators review the benefits of relocating/registering their space activities to a nation with more favourable legislation.

It is easy (especially for lawyers) to focus on regulation, but it is crucial to appreciate that regulation is just one of a number of means of achieving desirable outcomes (such as good levels of safety, sustainability) and regulation should work alongside and complement other drivers, such as industry best practice and standards, international co-operation, the investment market and, of course, the insurance market.