There's been new legislation introduced in the House a couple days ago, that amends the Commercial Space Launch Act. It appears to supercede HR 3245, introduced last fall, which I analyzed at the time.

I haven't had the time to analyze it in detail, and I'd like to talk to some of the people involved in drafting it before I pontificate, but one major change seems to be a new way of allowing people to fly, by letting them get a permit for research and experimentation, without requiring a full launch license. I think that it's meant to be analogous to an experimental aircraft certificate, and it's probably to address Burt Rutan's chafing under the licensing regime.

I've long advocated something like this, and it will be interesting to see if it makes it through the legislative process unscathed (and if it gets vetted by Foggy Bottom, which may be concerned that the process isn't rigorous enough to keep us compliant with the Outer Space Treaty). There are other implications of this legislation as well, but further discussion will have to await my finding enough time to dig into it.

[Update on Saturday morning]

XCOR seems pleased with the legislation.

I've heard much of this fabled Outer Space Treaty. Can anyone recommend a good discussion of its conditions? I remember reading a blog argument that this treaty was a more significant obstacle than say making a profit by launching rockets. They seemed to be arguing that this treaty was protecting outer space from the rampaging corporations. I dutifully pointed out the obvious.

I think the OST will have to be toppled or severely amended before we get the space frontier we want. The US State Dept is already on record saying the treaty eliminates our right to make property claims out there.

The treaty is also the reason for existance for the AST which must pay attention to most everything you do up there. Is that any way to run a business? We don't tolerate that kind of regulatory oversight very often.

Scaled Composites isn't the only group down there at Mojave that needs that kind of permit. The Xcor folks want it too. I imagine they will have their press release out in a day or two, so keep your eyes peeled for it.

As to whether any new licensing regime will satisfy the Outer Space Treaty requirements; all the OST requires is "authorization" and "continuing supervision" by the appropriate state party. A permission slip saying "the US government authorizes this launch" from the FAA with annual photocopies sent to the company would satisfy the letter of the treaty (obviously an exaggeration, but you get the idea). The mass of paper required by the FAA currently is only needed to satisfy US legislation, it is by no means required to meet international obligations. The main reason for licensing at this point is to make the government feel more comfortable with the fact that it might have to pay a large amount of the damage in case of launch failure (the US gov is liable for all damage from US space objects under the OST). The focus on government liability might be a reason to alter the OST, but this would be just as easily solved by just enacting legislation requiring private launchers to indemnify the government for any damages it pays. The launch industry would have problems finding insurance to cover all potential damages from a launch, but they would face substantially less paperwork. The middle ground ( just easing the current licensing burden) is probably the best for all involved; that paperwork is annoying and costly, but it does allow the risk of launch failure to be spread among multiple parties.

I honestly have not seen a great discussion online of the Outer Space Treaty. Spacefuture.com has some articles (Rand's can be found among them) addressing the legal issues facing emerging space markets which discuss the Outer Space Treaty, but to get a full perspective on the issue you will have to check out the Colloquiums of the International Institute of Space Law or some of the books on the issue (I suggest looking to Bin Cheng, Carl Christol, or Steven Gorove for the most in depth discussion). When I get some extra time, I hope to get spacelaw.blogspot.com up and running, but no promises as of right now.

Actually, another consideration is (or should be) that there really are no OST implications (liability or otherwise) for suborbital flights that occur totally within the US (or any given country). I wonder if this was a factor in the discussion of the permit process?

I share your curiosity in re the actual reasons for the permitting policy (and the recent changes).

The official policy behind the permitting process according of the FAA is to "protect the health of the uninvolved public". I think that since licensing power has been with the FAA they have downplayed (again officially) the international reasons for licensing. They also reference the goal of reducing investor doubt by creating certainly as to the relevant legal regime, but the emphasis is on health both in the policy documents and in the actual data required to get a license (probabilities of failure, magnitude of potential damage, potentially affected area, environmental impact statements, etc.).

I'm personally encouraged with most recent move as it seems to recognize that they have been too focused on applying as rigorous a licensing process for spacecraft as for aircraft (when the risks involved with both are quite different), while not allowing spacecraft the benefits of streamlined expiramental licensing procedures that have been available for aircraft.