By Simeng Wang[1]
Introduction
On 29 March 2026, SpaceX lost contact with Starlink-34343 after what the company described only as an ‘anomaly’. Space-tracking firm LeoLabs detected tens of debris fragments in the satellite’s vicinity. SpaceX did not disclose the cause and launched a further 29 Starlink satellites approximately six hours later. A near-identical event had just occurred three months earlier. With over 10,000 Starlink satellites in orbit, even a modest per-satellite failure rate translates into a growing debris contribution. At sufficient density, debris collisions generate further debris in a self-sustaining cascade known as the Kessler Syndrome, rendering entire orbital shells permanently unusable. However, SpaceX in fact faces no direct enforceable obligation under international law to prevent, explain, or be held accountable for this kind of accident.
This governance gap is the subject of the present post. In 2025, global investment in space companies reached $55.3 billion, a 113% increase in a single year, and there are now over 27,000 tracked debris objects in orbit. The Secure World Foundation’s February 2026 report notes that over half of 2024’s space investors were first-time entrants, operating in a domain where no bilateral investment treaty (BIT) imposes an environmental obligation for investors. International space law, which is based on the 1967 Outer Space Treaty (OST) and the 1972 Liability Convention, was designed for a State-centric world and does not directly apply to private actors. This post argues that international investment law, a regime increasingly attentive to investor obligations as well as investor rights, can also extend that evolution to the space sector by imposing enforceable environmental obligations on private space investors. Section II clearly identifies the structural ‘dual accountability gap’ in both legal regimes for international investment law and space law. Section III addresses the jurisdiction gateway for whether BITs can apply to space activities at all. Section IV introduces the proposed Debris Article for next-generation BITs, exploring how industry-recognised soft-law instruments such as the Space Sustainability Rating could serve as enforceable due diligence standards.
A Dual Accountability Gap
The reason private space investors face no meaningful environmental accountability under international law is structural: both space law and investment law contain blind spots that together create a dual gap.
International space law, as currently structured, is not designed to directly regulate private investors at the international level. The 1972 Liability Convention assigns absolute liability for damage to States, not private companies. Although Article VI of the Outer Space Treaty (OST) requires States to provide ‘authorisation and continuing supervision’ for their nationals, it stops short of imposing direct international obligations or enforcement mechanisms on the private entities themselves. Consequently, a company that negligently creates debris remains largely shielded from direct accountability under the existing international treaty framework.
On the investment law side, traditional BITs were designed to protect investors from States, rather than to regulate investors’ conduct for environmental protection. Under the Investor-State Dispute Settlement (ISDS) system, investors can bypass domestic courts and bring claims directly to international arbitral tribunals. Where jurisdiction exists under an applicable investment treaty, a State that enacts new debris regulations may face a treaty claim alleging that the measure deprives investors of legitimate profit expectations. The time and financial costs associated with arbitration proceedings gives States reason to hesitate before imposing new environmental requirements on space investors. That is known as the regulatory chill problem, whereby the legal safeguards meant to protect investors often prevent States from passing urgent sustainability laws. Although modern BITs in the energy and mining sectors have begun to include environmental and ESG clauses, such as the Morocco–Nigeria BIT of 2016 and the Netherlands Model BIT of 2019, the space sector remains absent from this trend.
The result is that private investors operating in one of the most commercially dynamic and environmentally consequential domains of the twenty-first century face essentially no environmental accountability under international law.
Can BITs Even Apply to Space?
Before investment treaties can be redesigned to hold space investors accountable, a threshold question must be answered: do BITs apply to space activities at all? Most treaties define protected investments by reference to the territory of a host State. But under Article II of the OST, outer space is non-appropriable, and no State may claim sovereignty over it. Two solutions resolve this jurisdictional puzzle.
The first is an asset-based definition. Modern BITs define ‘investment’ broadly, protecting not only physical assets but also shares, licences, and intellectual property rights. Satellites are tangible assets with significant economic value. Orbital slots and spectrum rights are licensed, tradeable, and commercially critical. If the focus falls on the asset rather than on a fixed physical location, space investments readily qualify as BIT-protected investments. They also satisfy the classic Salini test, covering capital contribution, duration, and risk. Even regarding the more contested criterion of ‘contribution to development,’ satellite operations align strongly with host State interests as they provide critical infrastructure for modern telecommunications and scientific progress.
The second is what this article terms functional territoriality. Article VIII of the OST grants the State of registration ‘jurisdiction and control’ over a space object. This registration-based jurisdiction can function as a legal substitute for the ‘territory’ requirement in BITs, such that the State of registry becomes the functional host State. This approach is consistent with established arbitral practice. In Abaclat v. Argentina (para. 374), the tribunal confirmed that an investment’s location is determined by where its economic impact is felt rather than where physical performance occurs. Because a satellite’s legal and economic life is closely tied to its State of registry, that State becomes the functional host for the purpose of treaty protection. With jurisdiction established, the path to reform is open.
The Debris Article: A Practical Reform Proposal
The central proposal of this article is to include a dedicated ‘Debris Article’ in next-generation BITs. This represents a strategic extension of existing investment law mechanisms to a nascent and commercially dynamic domain. While the procedural mechanics—such as specific monitoring standards and evidentiary thresholds for negligence—would require further granular definition during the treaty-drafting process, the present aim is to establish a foundational legal architecture through four operational components. The Debris Article would have four operational components.
First, mandatory investor due diligence. Investors would be required to develop and implement a debris mitigation plan covering the full mission lifecycle, from design and launch through to decommissioning and disposal. Unlike existing space law obligations that only apply to States, this obligation would attach directly to the investor as a condition of treaty protection. That shift in the locus of responsibility is the Debris Article’s most fundamental contribution.
Second, the Debris Article should empower host States to bring counterclaims against investors whose negligence contributes to orbital debris. The legal foundation for this lies in Urbaser v. Argentina (paras. 1153-1155), where the tribunal accepted jurisdiction over a host State counterclaim premised on an investor’s alleged breach of international human rights obligations. Although the counterclaim failed on the merits because the tribunal distinguished between a State’s ‘obligation to perform’ and an investor’s ‘obligation to abstain,’ the jurisdictional reasoning remains significant. It established that investors may indeed be subject to international obligations, providing a crucial precedent for holding space investors accountable for negative environmental impacts such as debris generation.
Third, the Debris Article should designate compliance with a recognised industry standard as prima facie evidence of investor due diligence. The Space Sustainability Rating, which scores satellite missions on debris generation, collision probability, and end-of-life disposal planning, is a strong candidate for this role. It is currently voluntary and non-binding, but designating such a standard as a legal benchmark would harden it into a legally operative one. This approach finds support in Urbaser v. Argentina (para. 1195), where the tribunal drew extensively on soft-law instruments, including the UN Guiding Principles on Business and Human Rights, to examine whether international law obligations applied directly to the investor. It established that soft-law instruments are a legitimate basis for identifying the scope of investor obligations under international law. The Debris Article would apply the same reasoning to the space sector, using recognised industry standards such as the SSR as the benchmark for defining what due diligence requires of a space investor. Similarly, Article 31(3)(c) of the Vienna Convention on the Law of Treaties (VCLT) provides the essential interpretive gateway for tribunals to incorporate technically grounded soft-law instruments into their reasoning.
Fourth, the Debris Article should incorporate relevant global operational guidelines as binding interpretive references, rather than leaving tribunals to develop standards de novo. Instruments such as the UN Long-Term Sustainability Guidelines and the Cologne Manual on Space Traffic Management illustrate the kind of operational specificity that treaty drafters could draw upon. The proposed Debris Article should establish a principled framework for tribunals to identify and apply relevant guidelines, allowing the legal process to adapt alongside evolving technical standards.
Conclusion
The orbital environment is a commons. It cannot be owned, but it can be degraded, and the current international space and investment law frameworks are structurally ill-suited to prevent such degradation. The result is a dual accountability gap that the commercialisation of space is rapidly making untenable. This post has argued that the tools to close that gap already exist within the investment law framework, addressing jurisdictional barriers from the perspective of asset-based definitions and functional territoriality, using host State counterclaims precedent and the logic of hardening soft-law instruments in space industry to define the scope of investor obligations, which has been recognised by tribunals and is increasingly reflected in treaty practice. What remains is to assemble these elements into a coherent instrument for the space sector.
It must be acknowledged that this is a forward-looking proposal. Its success relies not only on the continued evolution of international jurisprudence regarding investor obligations, but also on the deliberate political commitment of major space-faring States. To move from theory to practice, a collective recalibration is needed to ensure that investment protection does not come at the cost of orbital sustainability. The Starlink fragmentation events of late 2025 and early 2026 are a reminder that the gap between commercial reality and legal accountability is not narrowing on its own. Each anomaly that goes unexplained, and each launch that follows hours later, makes the case for reform more pressing.
[1] Simeng Wang is a PhD candidate at Durham University researching the intersection of international investment law and sustainable development. This blog post is based on her presentation at the 2nd Conference on Earth–Space Sustainability, Leiden, 19 March 2026. She can be contacted at simeng.wang@durham.ac.uk.