E-Space's Rwandan Roots Seen Evading Regulation
Low earth orbit satellite startup E-Space's plan to launch as many as 100,000 satellites (see 2202080004) licensed by Rwanda is seen by critics as an effort to skirt the heavier regulatory or spectrum burdens of more-traditional space regulatory regimes. Some see such moves potentially leading to bigger orbital debris problems.
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Rwanda and some other African nations "have become forward leaning on embracing space and environmental issues" and "it was natural to work with and from a country" that will benefit from the services being developed, said E-Space founder Greg Wyler in a statement.
Operating under a Rwandan flag is not about avoiding regulatory restrictions but about seeking easy spectrum access, said Ian Christensen, Secure World Foundation (SWF) private sector programs director. He said a variety of satcom companies have filed for spectrum access in nontraditional venues, citing AST having its non-geostationary constellation licensed in Papua New Guinea (see 2004140001). AST didn't comment Tuesday. Registering constellations in more nontraditional nations gets access to that country's spectrum allocations without necessarily having to compete or going through sharing and coordination, Christensen said.
Operators often register with particular nations like Luxembourg for tax reasons, but Rwanda in this case might have been chosen for its light regulatory touch, said Chris Kunstadter, AXA XL global space head, at an American Bar Association air and space law forum last week (see 2202250029).
"If you are looking for an underregulated place, Rwanda is a good choice," said Melissa Rusk, director of the University of Georgia's Rusk International Law Center. Rwanda started its national space program in the past year as it tries to position itself as the hub of African space activity, she said. It signed, but isn't a party to, both the Outer Space Treaty (OST) and the Convention on International Liability for Damage Caused by Space Objects, she said. Rwanda hasn't signed or ratified the Convention on Registration of Objects Launched into Outer Space, Rusk said.
Not everyone sees spectrum advantages from registering in nontraditional states. Those filings still need to get through the ITU, and countries with less-experienced regulators are likely less familiar with ITU processes, which could mean errors and delays, emailed Summit Ridge Group President Armand Musey. "E-Space was likely promised something as an inducement to file in Rwanda or believes filing in Rwanda positions it better for something," he said. "Perhaps a government contract?" Musey said some companies seeking efficiencies file in the Isle of Man, "where they have essentially outsourced satellite filing to a private company," ManSat. As a result, the Isle of Man is one of the largest generators of satellite filings with the ITU, he said.
Asked about regulatory arbitrage, Wyler said E-Space "is building full systems with global reach [and] the team has a substantial track record of building real systems and time will soon demonstrate that."
"E-Space will be the most sustainable satellite system in history" and drive new levels of environmental requirements "to be a net positive for space," Wyler said. He said its satellites will have a small cross-section, lowering the likelihood of collision, and fail-safe into a fast deorbit if they fail, and thus not create orbital debris. He said E-Space is "reducing the cost of constellations by 10x," opening up new markets. He said there's a particular focus on governments and large corporations with a need to run secure applications.
Registering with Rwanda means "a regulatory race to the bottom" by seeking a less-onerous regulatory regime, said Michael Runnels, business law assistant professor at California State University-Los Angeles. He said a more narrowly tailored OST with orbital debris mitigation requirements is needed.
Spectrum access might be the motivator, but registering in nontraditional nations raises questions about whether those locations have adequate regulatory regimes to look at orbital debris and congestion, said SWF's Christensen. Nations like the U.S. still have a regulatory hook when those foreign-flagged operators seek U.S. market access, he said. E-Space hasn't made any applications with the FCC's International Bureau. Any space-faring nation or country interested in becoming one should ratify the OST, and the U.S. and other signatories should promote that, he said. But the U.S. as a leading regulatory jurisdiction and market needs to look at promoting dialogue among nations and their regulators, building a common understanding and relationships, he said.