Publication and Path Forward

The EU Space Act is a “proposal for regulation” put
forward by the European Commission. The Commission is the EU body
that holds legislative initiative, or the power to make proposals
for legislation.¹

The Commission presented the draft Act to the European
Parliament and the Council of the European Union, the two
co-legislative bodies of the EU. The presentation, and potential
subsequent action of the Council and Parliament, is pursuant to
Article 294 of the Treaty on the Functioning of the European Union
(TFEU), which sets out the ordinary legislative procedure of the
EU.²

Under Article 294 TFEU, the Parliament and Council may debate,
revise, and adopt the Act. The European Parliament performs the
first review of the Commission’s proposal and adopts a
position, with no set deadline. The Parliament then sends its
position to the Council.

Should the Council endorse the Parliament’s position, the
Act becomes law as written. Conversely, if the Council does not
approve the Parliament’s position, it may adopt its own
position, stating the reasons therefor, and return this to the
Parliament.

Upon receiving the Council’s position, the Parliament has
three months to determine its course of action. It may (i) approve
the Council’s position or refrain from acting, in which case
the Act becomes law; (ii) reject the Council’s position by a
majority vote, in which case the Act shall be considered not
adopted; or (iii) propose amendments, initiating the second
“reading,” or round of review.

Authority to Promulgate the Act

The draft Act cites Article 114 TFEU as the legal authority for
the EU to adopt a supranational space regulation.

Article 114 empowers the EU Parliament and Council to adopt
measures to ensure the establishment and functioning of the
“internal market.”⁵ Precedent indicates
Article 114 may only serve as a basis for supranational legislation
when: (1) there is a finding of disparities between national rules,
and (2) the differences are such as to obstruct, or be likely to
obstruct, the fundamental freedoms and thereby have a direct effect
on the establishment and functioning of the internal market.

The draft Act claims these two factors – disparities
between national rules, and a likelihood for these disparities to
affect the internal market – are present and justify
invocation of Article 114 TFEU to adopt a supranational space
regulation. Specifically, 13 of the 27⁶ EU member states
currently have national space laws,⁷ and another five
are planning to develop a national space law.[8] The Act claims
this variation sets up a market disparity that may disrupt the
internal market and which Article 114 is intended to address.

Notably, the Act presumes that authority per the TFEU under
Article 114 is sufficient to overcome the exclusion in Article 189.
Article 189 grants member states exclusive competence in laws and
regulations related to outer space, and explicitly excludes Union
authority for “any harmonization of the laws and regulations
of the Member States.”⁹ However, as the Act notes,
“in accordance with established case-law,” Article 114
may be used as a legal basis for “establishment and
functioning of the internal market” in space services.[10]

Compliance with the Principle of Proportionality

Review of the draft Act indicates the proposed scope may be open
to challenge insofar as it violates the principle of
proportionality.

The principle of proportionality is one of the foundational
principles of EU law, enshrined in Article 5(4) of the Treaty on
European Union (TEU).¹¹ Proportionality requires that
any measure the EU adopts must be suitable to achieve the intended
objective (suitability), must not go beyond what is necessary to
attain that objective (necessity), and must strike a fair balance
between the means employed and the aim sought (proportionality
stricto sensu or proportionality in the narrow sense).

Proportionality, together with subsidiarity, acts as a
constitutional check on the exercise of the Union’s
competences. It applies to all actions EU institutions undertake,
in particular in the context of legislative and regulatory
measures. It is both a standard of institutional restraint and as a
key criterion for the judicial review of EU acts, and operates as a
safeguard to ensure that EU intervention remains within appropriate
bounds relative to the pursued policy objectives. According to this
provision, the content and form of Union action shall not exceed
what is necessary to achieve Treaties’ objectives.

Necessity

It is arguable that certain provisions of the draft Act may
violate the principle of proportionality because they exceed what
is “necessary” to harmonize the safety, resilience, and
environmental sustainability of space services. For example, the
Act states the Commission “shall” develop a Union Space
Label Framework “to promote enhanced voluntary adherence to
high standards of protection of space
activities.”¹² But no member states currently
require such labels, so there is no disparity in national rules.
Moreover, the draft Act recognizes methods for evaluating the
environmental impacts of space activities “are clearly
underdeveloped today,”¹³ so it’s unclear what
evidence – other than conjecture – may be offered to
assert environmental labeling regimes are “necessary” for
environmental sustainability.

Narrow Proportionality

The draft Act may violate proportionality in the narrow sense
because there may not be a fair balance between the means, or
requirements and costs, and the benefits, or aim sought.

The draft Act’s impact assessment concludes the regulations
strike a fair balance because the higher costs driven by
requirements of the Act would be “completely” offset by
the annual benefits.¹⁴ However, this tradeoff (costs
offset by benefits) relies on the following: “The main
assumption taken to carry the cost-benefit analysis was that the
legislative act would reduce the amount of debris by 50% by 2034
due to increased sustainability of space
activities.”¹⁵

This assumption is significant. It is not that the Act would
slow the rate of growth of debris populations; it is that the Act
would facilitate elimination of half the current debris catalogue
(i.e., amount of debris) in 10 years.¹⁶

If the main assumption underlying the Act’s cost-benefit
analysis is unrealistic, then the cost-benefit analysis is flawed.
More specifically, if the Act cannot prompt a 50% reduction in the
total orbital debris population in 10 years,¹⁷ then the
annual benefits would be less than claimed and may no longer
“completely” offset the Act’s costs.

Conclusion

The release of the draft Act is the first step in what may be a
long process of debate and reconciliation towards potential
adoption. The Parliament and Council’s discussion and
reconciliation of the draft Act may reduce the Act’s
scope.¹⁸ Nonetheless, operators – Union-based and
international alike – should follow the Act’s evolution
to remain aware of potential new laws that would impact operations
globally.

Footnotes

1 The European Commission is made up of 27 commissioners,
including the president, with one commissioner from each EU member
state.

2] Consolidated Version of the Treaty on the Functioning
of the European Union art. 294, Oct. 16, 2012, 2012 O.J. (C 326) 47
[hereinafter TFEU].

3 Commission Proposal for a Regulation of the
European Parliament and of the Council Establishing the Space
Programme of the Union and the European Union Agency for the Space
Programme […], COM (2018) 447 final (June 6,
2018).

4 Regulation 2021/696, of the European Parliament and of
the Council of 28 April 2021 establishing the Union Space Programme
and the European Union Agency for the Space Programme […], 2021
O.J. (L 170) 69.

5 TFEU art. 114(1).

6 The EU member states are: Austria, Belgium, Bulgaria,
Croatia, Cyprus, Czechia, Denmark, Estonia, Finland, France,
Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania,
Luxembourg, Malta, Netherlands, Poland, Portugal, Romania,
Slovakia, Slovenia, Spain, and Sweden.

7 These 13 member states are: Austria, Belgium, Denmark,
Finland, France, Greece, Italy, Luxembourg, Netherlands, Portugal,
Slovakia, Slovenia, and Sweden.

8 Estonia, Germany, Poland, Romania, and
Spain.

9 TFEU art. 189(2).

10 EU Space Act, supra, at Explanatory
Memorandum.

11 Consolidated versions of the Treaty on European Union
art. 5(4), Oct. 26, 2012 O.J. (C 326) [hereinafter
TEU].

12 EU Space Act, art. 111(1).

13 EU Space Act, Explanatory Memorandum.

14 Commission Staff Working Document Impact
Assessment Report Accompanying the document Proposal for a
Regulation of the European Parliament and of the Council on the
Safety, Resilience and Sustainability of Space Activities in the
Union, at 50, SWD (2025) 355 final (“Assuming that a
legislative act for safe, resilient and environmentally sustainable
space activities would allow for a 50% reduction of space debris
over the next 10 years, the initiative would benefit satellite
operators, enabling an annual benefit of EUR 677.5 million,
completely offsetting the costs driven by the higher requirements
stemming from the law.”) [hereinafter Impact
Assessment].

15 Id. at 49.

16 At current levels, a 50% reduction in space debris by
2034 would require the removal of roughly 21,000 trackable debris
objects. It would also include a 50% reduction in
non-trackable space objects, and the introduction of no
new debris.

17 While not explicit, the impact assessment must
evaluate a reduction in the total amount of existing debris in
orbit, not merely a decrease in the rate at which new debris is
generated. This is evidenced by the discussion of costs associated
with collision avoidance. Currently, European operators in
low-Earth orbit carry out approximately 1,000 collision avoidance
maneuvers each year for all operational satellites (with 779
maneuvers reported in 2023). Id. at 55. The impact
assessment goes on to assume that a significant reduction in space
debris would correspondingly result in a 50% reduction in the
number of required collision avoidance maneuvers per year.
Id. at 56 (Table 19, showing projected annual maneuvers
reduced to 516 for active LEO European satellites). However, this
projected benefit—a reduction in collision avoidance
maneuvers to half their current level— could only be
achieved if the total amount of debris currently catalogued is
drastically reduced. It is not sufficient to simply slow the
creation of new debris; the justification for the Act presumes
there must be an actual reduction in the present population of
debris objects already tracked in orbit.

18 See, e.g., Directorate-General for Comm., Simplification Measures to Save EU Businesses
€ 400 Million Annually, European Comm., May 21, 2025,
(noting a Commission initiative to reduce “unnecessary
bureaucracy and create a regulatory environment that drives”
innovation and growth, and which includes proposed simplification
of provisions of the General Data Protection Regulation
(GDPR)).

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