ZAFAR & ASSOCIATES - LLP | Satellite Launch Contracts - Pakistan

Satellite launch contracts, service beginning with commercial handling of space, the contractual aspects relating to the construction, launching or even the exploration of a space object take on their full significance.

More commonly, aspects of private law become predominant, even if they are, of course, part of a framework of public, national and international law, stemming from national space programme, local legislation, community instrumentalities and international treaties.

Space contracts are not entirely novel contracts but they borrow pre-existing shapes and molds. However, contractual practice is innovating in order to respond to new feeds generated by innovative techniques whereby innovation is reflected here in the very fine adaptation to the subject of the contract. Let’s take a look at the general understanding about satellite launch contracts.

---

ZA-LLP is capable to draft an agreement between the country intending to launch a Satellite and the Company or Country which is capable to render the services for launching the same for the particular country. The primary objective of space program is for:

• The promotion of peaceful uses and application of space for socio-economic development and national security;

• Non-Militarization and weaponization of space;

• Fulfillment of international legal obligations; and

• International Cooperation.

In 1966, the structure of SUPARCO was taken over by the Federal Government which established it as a separate organization under the administrative control of Scientific and Technological Research Division. After the promulgation of SUPARCO Ordinance 1981, ratified by the National Assembly in 1987, the organization was given an autonomous status and three distinct wings were created thereby including; Space Technology Wing, Space Research Wing and Space Electronics.

Governing Laws for Launching Satellites

The task of launching a satellite and other space objects is governed by both state-ratified international treaties and national laws. International law of space governs state responsibility for their activities in space, registration of space objects, liability of states in case of damage caused and to ensure that each state conducts its national space activities in accordance to international law standards. Whereas national laws may vary from state to state, and are meant to supplement international laws and also regulates the authorizations and licensing frameworks of satellites.

The following United Nations International space treaties have been ratified by many countries:

• Outer Space Treaty 1967

• Rescue Agreement 1968

• Liability Convention 1972

• Registration Convention 1976

• Moon Agreement 1984

Other Space Agreements, to which most countries have ratified to, include:

• Treaty Banning Nuclear Weapons Test in the Atmosphere, in Outer Space and under Water (1963)

• Agreement Relating to the International Telecommunications Satellite Organization (1973)

• Convention on the International Mobile Satellite Organization (1979)

• International Telecommunication Constitution and Convention (1994)

As far as national laws on regulating space objects are concerned, some countries do not have any regulatory framework or legislations enacted.

Satellite Launching Agreements / Contracts

Before discussing the various clauses that are included within a Satellite Launch Agreement there are certain important determinations which need to be made when starting a project. These include:

• Determining the Launching State

• Registration of the Satellite

• National Supervision and Control

Launching State

In cases where more than one country is associated with the launching of a satellite, it becomes important to determine which state is internationally responsible for the launch, as the international rights and obligations of each state may vary. This is evident from Article VII of the Outer Space Treaty which requires that “Each State Party that launches or procures the launching of an object int outer space, including the Moon and other celestial bodies, and each State Party from whose territory or facility an object is launched, is internationally liable for damage.” Such is also important to achieve compliance with the international space laws. In Pakistan’s instance, which lacks its own satellite launching station, all satellites have been launched from either China or Russia and therefore such determination becomes pertinent.

Evidently, there are four categories of launching states:

• i) The state that launches

• ii) The state that procures the launch

• iii) The state from whose territory an object is launched

• iv) The state from whose facility an object is launched

The first category applies to national space activities by national government and space agencies while the subsequent categories concern state involvement in launching.

After answering the question of launching states, it is then advised to see which international space treaties these states are party to, which would determine the international responsibilities applicable, where the primary one amongst these is international registration.

International Registration

As per international law, states are required to register their space objects on international registries as a way of notifying the global community of their space activities and to track as to which space object belongs to whom. These registries are maintained by the United Nations Office for Outer Space Affairs (OOSA). International registration is made mandatory under the 1975 Registration Convention, whereas the 1967 Outer Space Treaty only speaks of national registries. The OOSA maintains two registries, one for voluntary compliance in line with the UNGA Resolution 1721 B of 1961 and under the Registration Convention. A state that is party to the United Nations is encouraged to register their space objects with the 1961 Resolution, while state parties to the Registration Convention are mandated to register with OOSA.

For example, Pakistan being a state party to the Registration Convention is mandated to register all its satellites with OOSA and currently has 6 satellites registered including PRSS 1, PAKTES 1A, ICUBE 1, PAKSAT 1R, BADR B and BADR 1.

Although registration with the UN is done after the launch of the satellite, it is still important to expressly state the same within the launching agreement for compliance.

National Supervision and Registration

When a launching a satellite from a country with national space legislation, or using a state’s territories/facilities abroad, it is important to examine that state’s space legislation. The same also applies where the launch is part of a launch procured by such a country, but is launching elsewhere. Since Pakistan lacks its own launching port/station and procures facilities abroad, these investigations are especially important.

As state become responsible for space objects launched, they are motivated to oversee launching, and only license and authorize launches that they consider appropriate, which conforms to their interests, and that meet their requirements. Often states may refuse to regulate or authorize a launch due to technicalities found or a state may refuse it on the basis of not qualifying as a launching state. It is necessary to make these determinations while finalizing a launching agreement.

Furthermore, the 1967 Outer Space Treaty confers to a state the powers of jurisdiction and control over space objects that appear on their national registry of space objects. Pakistan established its national registry on 14th November 2008, which is maintained by SUPARCO at its headquarters in Karachi.

Necessary Clauses for a Satellite Launching Agreement / Contract

The success of all space activities depends upon the launching of space objects, which can involve multiple, private and public, parties. The legal issues and concerns between the launcher entities and the customers is addressed by the Launch Services Agreement. These launch agreements can be regarded as an understanding between the carriers and the user where the carrier renders several services for a price and to place the user’s payload in outer space. A launch agreement mainly constitutes of three parts, where the first part relates to the launch itself. The second part relates to the rights and obligations of parties, which varies in every agreement. Lastly, the third part of the agreement relates to the general rules applicable to launches. Furthermore, agreements not only include the launch itself, but also include the pre-launch setup, preparation/manufacturing phases and the in-orbit life arrangement of the satellite.

The following clauses are deemed as necessary to be included with a launching agreement:

Services to be rendered

In these clauses, the parties set the type and number of launches and the characteristics of the agreed services. The carrier or launch services providers promises to use its best efforts:

• To provide for the compatibility of the payload with the space vehicle

• To complete the preparation and check out the vehicle/payload interfaces

• To regulate the user’s operation and handling of the payload in such point of delivery

• To appoint a mission coordinator responsible for the coordination of all financial matters and the launch schedule

• To manage and conduct the payload launching, using its best efforts to accomplish all the provisions set forth in the launch agreement

• To place a spacecraft in the agreed orbit in Outer Space.

In return, the user party to a launch services agreement commits to the following duties and responsibilities. Here the user may be any governmental or non-governmental entity or individual who has arranged for or otherwise provided payloads, space services or persons to be flown on the vehicle:

• To provide for the manufacture of the payload so as to permit launching in the hired space vehicle;

• To deliver the payload to the launch site;

• To offer the carrier’s technical manager all mission requirements to that the latter can prepare the launch vehicle. Such requirements may be specified in the annexures;

• To assure compatibility of the payload with the launch vehicle;

• To provide the carrier with the design and data of the payload for its review;

• To offer assistance for the integration of the payload and the ground equipment so that the carrier can examine and confirm the compliance with the vehicle and other contract requirements;

• To provide information about the payload and the vehicle;

• To provide a control center for the payload performance;

• To control the payload after deployment;

• To provide training for the handling of the payload during the flight;

• To appoint a user mission coordinator responsible for coordinating with the carrier’s representative all the financial matters and the launch schedule, among other issues; and

• To appoint a technical manager to coordinate all the technical activities with the carrier’s technical manager.

In addition to these, the parties may agree to additional services which sometimes may be shared by both parties.

Programme of Launches

Setting a launching date is crucial to the launching agreement, where such date is mutually agreed upon through mutual consent, but in case of dispute, the carrier fixes it unilaterally. This marks the beginning of the launch period, which generally consists of ninety days. In any case, the launch service provider reserves the right to change the launch date and set a new one.

Risk Allocation

For the purpose of simplifying the allocation of risks, a no-fault, no-subrogation waiver of liability under which each party agrees to be responsible for any damage which it sustains to its own property and employees involved in the operations, is included within the contract. This is applicable where the damage is caused by the carrier, the user or other users involved in the operations and whether such damages arise through negligence or otherwise. Similar waivers of liability are also executed where contractors or subcontractors are involved. Such waivers of liabilities must be interpreted to the broadest extent to achieve the intended objectives.

Consideration

A consideration clause may be included. Where private entities are deployed for launching services, the user shall pay to the carrier Fixed Prices for Standard Shuttle Services, Fixed rates for certain Optional Shuttle Services, Short-Term call-up charges and other Governmental Costs incurred in providing special services or charges.

Termination

These agreements may generally be terminated by any party in case certain events take place, such as lack of payment of user, or inability of the carriers to provide the launch services. Both may also terminate the agreement subject to penalties.

Dispute Resolution

A dispute resolution clause may also be included within these launch agreements. Generally, disputes are reviewed administratively by the administrators and directors of both carrier and the customer, who will jointly arrive at a final and conclusive solution.

---

Our Core Competencies

---