AIA Praises Extension of Commercial Launch Indemnification Law

XCOR's Lynx suborbital vehicle
XCOR's Lynx suborbital vehicle


Congress has taken a major step for the U.S. commercial space launch industry by extending government indemnification of launches for another three years.

“Elimination of government indemnification would have driven launch business overseas,” said AIA President and CEO Marion C. Blakey. “In 2008 only six of the 28 worldwide commercial launches were conducted by U.S. companies, and America can’t afford to lose more of that business.”

The indemnification regime, set to expire on December 31, helps protect U.S. commercial launch services providers against catastrophic third-party liability claims resulting from FAA-licensed launch activities. Payment of claims is not automatic and no funds are committed to this regime.  Congressional approval is required for any payment.

“As space launch capabilities have been developed by other nations our share of commercial launches has decreased significantly, Blakey said. “Further loss of our commercial launch share could impact civil and national security payloads because the same U.S. companies also launch under government contracts.”

While today’s passage marks a very important step, AIA looks forward to working with Congress to make the indemnification regime permanent.  Since launch manifests can extend out for several years, the regime maintains continuity in the business environment and strengthens U.S. international competitiveness.

“The indemnification regime provides a level playing field in a very competitive global space launch market, since every other space faring nation provides some form of government indemnification to commercial launchers,” said Blakey.

[Editor’s Note: The bill has been signed into law by President Barack Obama.]