Arbitration Rules for Outer Space

The Permanent Court of Arbitration (“PCA”), an intergovernmental body based in The Hague and established by treaty over a century ago to provide international dispute resolution services, has recently issued the first set of rules specifically designed to govern arbitrations relating to outer space activities. The PCA Optional Rules for Arbitration of Disputes Relating to Outer Space Activities (the “Optional Space Rules”), formally adopted on December 6, 2011, took three years and over a dozen leading experts in air and space law to develop. The Space Rules are based on the standard UNCITRAL Arbitration Rules, but contain modifications to meet the particular needs of disputes arising out of outer space activities.

Just as parties are free to agree to resolve their dispute by arbitration rather than litigation, parties may also select by agreement the arbitral forum and the particular set of rules that will govern their arbitration. The PCA’s Optional Space Rules offer several features that may be useful for parties seeking to resolve a dispute involving outer space. For example, under the Space Rules, parties can select a one-, three-, or five-judge arbitration panel. To assist parties in selecting an arbitration panel, the PCA offers a list of specialized arbitrators with experience in space law. The Rules contain streamlined procedures for selecting the arbitrators and for resolving interim disputes during the course of arbitration in consideration of the urgent nature of many space-related disputes. One modification that will be particularly useful to parties in the space industry is the expanded confidentiality provisions of the Space Rules, which offer greater protection of trade secrets, intellectual property, and other confidential business information. The Space Rules also contain special procedures for obtaining expert testimony (at the initiative of the parties or the arbitrators), including the establishment of a list of specialized space-related technical and scientific experts. Finally, for parties wishing to use the Space Rules, the PCA has published a model arbitration clause for inclusion in contracts.

The PCA’s adoption of specialized rules for arbitrations relating to outer space activities is the latest sign of the exponential increase in private space exploration activity. No doubt, the Space Rules will be helpful for resolving disputes within the $250 billion global space industry. No set of arbitration rules is a one-size-fits-all solution, however, and the PCA’s Space Rules may not provide the best set of arbitration rules, or the best forum, for resolving every dispute. As always, selection of an arbitration forum and rules should only be done after careful consideration and with the advice of knowledgeable legal counsel.


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