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Space Law and Policy
Series Editor: Maria A. Pozza

Maria A. Pozza
Joel A. Dennerley Editors

Risk Management
in Outer Space
Activities
An Australian and New Zealand Perspective
Space Law and Policy

Series Editor
Maria A. Pozza, Gravity Lawyers, Christchurch, New Zealand
​ pace activities across the Asia-Pacific, specifically in Australia and New Zealand,
S
are increasing and diversifying. Over the last decade, countries in this region have
seen significant growth within their national space industries and economies which
in turn benefit their wider societies due to the downstream application and use of,
space-related technologies, products, and services. This phenomena presents not
only a great opportunity for these countries, but also represents a situation
necessitating considered and fit-for-purpose space law and policy. Robust yet
flexible regulatory regimes are needed if countries in the Asia-Pacific, such as
Australia and New Zealand, are to benefit from the strategic and commercial
advantages associated with a presence in outer space and functioning domestic
space sector. These regulatory regimes must respond to, and address, numerous
challenges ranging from adherence to international legal obligations to issues of
geo-political space security and military concerns through to questions about how
best to regulate and support commercial space endeavours. These myriad factors
will have an impact upon how countries develop, implement, and refine their space
laws and policies. This series offers a unique perspective from this region and
intends to act as a source of knowledge and guidance for space actors across
government, the private sector and academia in the pursuit and furtherance of their
respective space activities and operations. The contributors to this series are all
experts in their field who share a common interest in strengthening space governance
via the promotion and development of space law and policy.

More information about this series at https://link.springer.com/bookseries/16522


Maria A. Pozza • Joel A. Dennerley
Editors

Risk Management in Outer


Space Activities
An Australian and New Zealand Perspective
Editors
Maria A. Pozza Joel A. Dennerley
Gravity Lawyers Management Consultant
Christchurch, New Zealand Canberra, Australia

ISSN 2662-9054     ISSN 2662-9062 (electronic)


Space Law and Policy
ISBN 978-981-16-4755-0    ISBN 978-981-16-4756-7 (eBook)
https://doi.org/10.1007/978-981-16-4756-7

© The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Singapore
Pte Ltd. 2022
This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether
the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of
illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and
transmission or information storage and retrieval, electronic adaptation, computer software, or by similar
or dissimilar methodology now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication
does not imply, even in the absence of a specific statement, that such names are exempt from the relevant
protective laws and regulations and therefore free for general use.
The publisher, the authors and the editors are safe to assume that the advice and information in this book
are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the
editors give a warranty, expressed or implied, with respect to the material contained herein or for any
errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional
claims in published maps and institutional affiliations.

This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd.
The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721,
Singapore
During June 2020, our co-author Professor
Hearnshaw lost his son Dr Edward
Hearnshaw during a fatal tramping accident
crossing the Hawke’s Bay’s Makaroo River.
Edward, who was my good friend and
someone who I fondly referred to as to
“Teddy”, left this life far too early. It is with
great privilege, and on behalf of the editing
team and authors of this book, that I would
like to dedicate this work to the memory of
Dr Edward Hearnshaw.
Foreword

 isk Management in Outer Space Activities: An Australian


R
and New Zealand Perspective

When asked to prepare this foreword, I gladly accepted this challenging task due to
the relevance and innovative character of the topic under consideration, namely risk
management in space activities.
While often unaddressed in legal literature, risk management represents a key
element in the study, preparation, and implementation of any space project, not only
from a theoretical/academic perspective but, most importantly, from the point of
view of actors and investors. Indeed, when one takes a moment to consider space
activities, it is rather intuitive to realize the variety of risks associated with them and
the danger that these risks pose to the successful completion of space-related
endeavors. First and foremost, space activities are inherently dangerous due to the
technological challenges that they face and the hazardous nature of the materials
used; in fact, despite the great progress made in the past decades, space launches are
far from being “routine,” and technical failures occur often. Human factors can also
lead to accidents and therefore can compromise the safe realization of a space proj-
ect. Secondly, due to the increased number of space actors and the growing level of
pollution in Earth orbits, the likelihood of un-intentional collisions among space
objects (active and non-active) increases on a yearly basis. Finally, due to their stra-
tegic relevance, satellites might become objects of attack (either by means of tradi-
tional or non-traditional/cyber means) in the context of military confrontation.
Taking the above elements into account, one should easily understand not only
the importance of assessing risk in the context of a space project but also the need
to bring these risks within acceptable levels or thresholds. From this point of view,
the present book represents a useful, and rather unique, “tool” to perform this task.
What makes the book unique is the approach that it endorses, one that focuses on
practical considerations rather than theoretical ones. In particular, the book empha-
sizes the importance of determining “context” when assessing risk; in this respect,
the authors suggest recourse to the Layers of Control Framework, a structure that

vii
viii Foreword

enables a better understanding of the types of risk controls that a risk manager is
likely to implement based on their situation. An additional value that this book pro-
vides are the varied case studies that it presents, each examining risk and risk man-
agement in relation to different space-related contexts; indeed, each chapter focuses
on one specific issue, such as insurance, space debris mitigation, and cyberattacks,
and analyzes how risk is managed therein. Such a choice enables the book to tackle
some of the most pressing issues in the space domain and to bring a “fresh” approach
to them.
Overall, I am extremely confident that the book will represent an important con-
tribution to the space law literature and, most importantly, will become an essential
reading for those with an interest in the subjects of both risk management and space
activities. The experience and the level of the authors provide a further guarantee of
the quality of the manuscript.

Institute of Space Law and Strategy Fabio Tronchetti


Beihang University, Beijing, China
Editor’s Acknowledgements

Writing and editing a book of this nature during a first-of-a-kind global pandemic
was certainly not an easy task and presented us with unique challenges. However,
the challenges that COVID-19 presented did not phase the authors or editing team
working on this book. Both the authors and the editing team demonstrated an incred-
ible work-ethos which was built on a foundation of support for one another, good
humour, and positive encouragement. To the authors of this book, I want to express
my heartfelt thanks for your incredible contributions to this work, especially during
a very challenging time.
I have been privileged to work alongside an incredible editing team that banded
together despite the global challenges that COVID-19 presented. The effort, dedica-
tion, and time given to the reviewing process, even before going out to external
reviewers, was truly extraordinary. It is impossible to find the appropriate words of
gratitude that one might extend to a group of individuals that, without any hesita-
tion, willingly gave up their time and energy because they believed in the impor-
tance of this book. My thanks to Tyson, Joel, Andreas, and Sarah, for being truly
wonderful to work with.
I would also like to thank my authors and editorial teams’ families (as well as my
own family) for allowing their loved ones to dedicate so much of their time and
energy away from them to the culmination of the work produced in this book.
A book of this nature required many of us to consult with industry professionals
in order to gage our respective theories and test analysis. The advice, time, and
willingness given to us by individuals who are highly admired in their respective
fields was truly phenomenal. In this regard we, would like to thank Dr Fabio
Tronchetti both for the book’s foreword and his ongoing support during the writing
process. We would like to thank Dr Brett Biddington AM, Dr Malcolm Davis,
Morten Pahle, and Professor William B. Boothby for providing their guidance,
expertise, and wisdom in the creation of this book. A special thanks is extended to
Brad Robb, MD of ALARP Solutions (a boutique management consultancy, spe-
cialising in governance, risk, assurance, and system safety solutions), for giving us
permission to use the Layers of Control Framework as a contextual aid for this book.

ix
x Editor’s Acknowledgements

Encouragement, support, and wisdom are fundamental key elements that every
editor requires when producing a work of this nature. I owe a great deal of thanks to
Lucie Bartonek, the Springer Commissioning Editor of Business, Economics, Law,
and Space Studies, for her ongoing support of us in producing this work.
Finally, I owe a debt of gratitude to my assistant editor Joel A. Dennerley. Joel is
not only a rising star in the field of space law and policy, he is truly a gifted intellect
in the complex and evolving field of space studies. As a collaborative work col-
league, good friend, and fellow space professional, not only do I have the utmost
admiration for Joel, I hold him in the highest esteem. To Joel I owe the greatest
thanks of all.

Maria
Gravity Lawyers, Christchurch, New Zealand A. Pozza
Contents

1 An Introduction to Risk Management


in Outer Space Activities ������������������������������������������������������������������������    1
Joel A. Dennerley, Aaron Young, and Maria A. Pozza
2 The Commercialisation of Space: An Overview
of Legal Risks and Considerations ��������������������������������������������������������   19
Andreas K. E. Sherborne
3 Risk Management Through New Zealand’s
and Australia’s Space Legislative Frameworks������������������������������������   47
Maria A. Pozza, Tyson Lange, Joel A. Dennerley,
and Heloise Vertadier
4 Transferring Risk Through Insurance Law:
Insuring Space Activities in Australia and New Zealand ��������������������   85
Blair McNamara
5 Managing the Risks Associated with Space Debris������������������������������ 107
Joel A. Dennerley
6 Managing the Cyber-Related Risks to Space Activities����������������������� 151
Sarah E. O’Connor
7 Light Pollution as a Risk for Astronomical Research
and How to Manage It ���������������������������������������������������������������������������� 177
John Hearnshaw
8 New Risks of Future Lunar Landings���������������������������������������������������� 221
Eric Dahlstrom and Maria A. Pozza

xi
About the Contributors

Eric L. Dahlstrom, BA, MS. Mr. Eric Dahlstrom is co-founder of SpaceBase


Limited, New Zealand, and co-founder of International Space Consultants.

Joel A. Dennerley, BA, LLB (Hons). Joel is a management consultant and is cur-
rently undertaking a Master of Applied Data Analytics.

John Hearnshaw, MA, PhD, DSc, FRSNZ, FRASNZ, MNZM, NZOM. Dr


Hearnshaw is Emeritus Professor of Astronomy at the University of Canterbury,
New Zealand.

Tyson Lange, BA, JD (Hons), GDLP. Tyson Lange is a lawyer based in Canberra,
Australia, specialising in the Australian regulation of outer space activities.

Blair McNamara, LLB (Hons), BBus, Dip Fin Ser. Blair is the principal lawyer at
Brockhill and Usherwood Lawyers, Melbourne, Australia.

Sarah O’Connor, B Int R (Hons), LLM. Sarah is a former researcher with the
Australian Strategic Policy Institute’s International Cyber Policy Centre. Sarah is
currently undertaking the Master of Applied Cybernetics course.

Maria A. Pozza, LLB (Hons), BVC (ICSL), PG Dip Legal Research & Skills, M
Inst, PhD. Dr Pozza is the director and principal lawyer of Gravity Lawyers, New
Zealand, which specialises in the international regulation, and New Zealand regula-
tion, of space activities.

Andreas K. E. Sherborne, BA, LLB (Hons). Andreas is a practising lawyer in


Canberra, Australia, and has experience advising on commercial and contract law,
international law, and space law.

xiii
xiv About the Contributors

Heloise Vertadier, LLM, MSc. Heloise is currently undertaking a PhD (supervised


by Dr Pozza) at the University of Otago, New Zealand, and works as a project coor-
dinator with Breaking Ground Trust.

Aaron Young, MSc Oceanography, BSc Physics, Grad Dip Meteorology. Aaron is
the director of operations and the governance risk and assurance discipline lead at
ALARP Solutions.
Chapter 1
An Introduction to Risk Management
in Outer Space Activities

Joel A. Dennerley, Aaron Young, and Maria A. Pozza

1.1 Introduction

Outer space has a special connection to humankind. For millennia, the night sky has
instilled in us a sense of awe and curiosity. In the twenty-first century, it is now a
domain which we explore and conduct activities within. Nevertheless, however
human activities are conducted in outer space, there will always be a series of asso-
ciated risks. Having evolved in a terrestrial Earth-bound setting, the foreign envi-
ronment of outer space exposes humans to a set of hazards primarily associated with
survivability and wellbeing. Therefore, when conducting space activities, we must
constantly and consistently strive to improve the safety, certainty and security of all
our space endeavours. This requires space actors to consider, understand and man-
age the risks that are inherit to their space activities. The purpose of this book is to
serve as a step toward this objective.
The breadth of human activities conducted in, having an effect in, or intended to
have an effect in outer space, ranges from the manufacturing of satellite compo-
nents, to the launching of space objects, through to the operation of ground stations
that receive data transmissions from spacecraft. All these endeavours represent
vastly different contexts in which risks can and do occur, and as such they must be
managed accordingly. There is no universal panacea that will manage, treat or solve

The views of the authors are the authors’ alone and are intended to provide commentary and gen-
eral information, and do not represent the views of any organisation. This chapter should not be
relied upon as a substitute for professional legal advice or for any other purpose.

J. A. Dennerley · A. Young (*)


Canberra, Australia
e-mail: info@gravitylawyers.co.nz
M. A. Pozza
Gravity Lawyers, Christchurch, New Zealand

© The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2022 1
M. A. Pozza, J. A. Dennerley (eds.), Risk Management in Outer Space Activities,
Space Law and Policy, https://doi.org/10.1007/978-981-16-4756-7_1
2 J. A. Dennerley et al.

all risks associated with every space activity. Drafting a work that either compre-
hensively examines every risk related to outer space activities, or which proposes a
universal approach to the management of all risks would be nearly impossible to do.
Such a tome would likely be out of date from the day it is published due to the
dynamic and constantly changing nature of space activities. Instead, this book sets
out to examine a variety of space related risks as well as risk management concepts
and practices that may be more broadly understood and applied. The mix of topics
found within this work has been selected to highlight some important factors associ-
ated with risk management in respect of outer space activities. It does so from an
Australian and New Zealand perspective. This points to the fact that risk manage-
ment as a concept and practice will be understood and applied differently by differ-
ent countries, corporations and individuals. Despite these differences, a commonality
to successful risk management is the ability to situate risk within its unique context.
Context in this sense is the different circumstance(s) that cohere to form the place(s),
setting(s) or surrounding(s) in which an event(s) will occur or unfold. Identifying
and understanding the specific context in which risks manifest, and to which risk
management will apply (for instance in outer space), is critical to the success of risk
management.
This introductory chapter, therefore, establishes a framework for the remainder
of the book by providing a structure to establish the risk context and situate risk
management considerations in outer space and its associated activities. To do this,
this chapter will explore what risk is, what risk management is, what constitutes
space activities and what defines the outer space context. The chapter will finish by
describing a conceptual framework designed to help situate the various risk contexts
in relation to the space domain. This will assist the reader locate those chapters that
are of special interest to them.
Each subsequent chapter in this book then examines, from an Australian and
New Zealand perspective, certain risks associated with selected space activities and
operations, and discusses how these risks have, or might be, appropriately managed.
As a whole, this book is not intended to provide a detailed guide to risk assessment
techniques. Rather it provides an overview through the use of specific case studies,
which examine the potential risks and how Australia and New Zealand manage
those risks.
With the above in mind, the intended readers of this work is potentially quite
broad. There may be many readers with an interest in risk management and space
activities. These may include members of international organisations, national and
state governments, employees of companies involved in space operations, to aca-
demics in disciplines such as astronomy, engineering, law and finance. This book
can be read cover to cover as a high-level overview of certain risks associated with
selected space activities. Alternatively, a reader may choose to read a specific chap-
ter that is of particular interest to them. To assist readers do this, a table is included
in Sect. 1.7 of this chapter.
1 An Introduction to Risk Management in Outer Space Activities 3

1.2 What Is Risk and What Is Risk Management?

Douglas Hubbard highlight’s in his book, ‘The Failure of Risk Management’, the
controversy surrounding the word ‘risk’ and how it is interpreted (Hubbard, 2020,
p. 9). In short, the term ‘risk’ is not universally accepted by all to mean the same
thing. Rather than addressing the various controversies surrounding the term, this
book will start with Hubbard’s definitions of risk and risk management as a good
basis for discussing risk considerations in the context of outer space activities.
These definitions are as follows:
DEFINITION OF RISK
Long definition: ‘A potential loss, disaster, or other undesirable event mea-
sured with probabilities assigned to losses of various magnitudes’ (Hubbard,
2020, p. 9).
Shorter (equivalent) definition: ‘The possibility that something bad could
happen’ (Hubbard, 2020, p. 9).
DEFINITION OF RISK MANAGEMENT
Long definition: ‘The identification, analysis, and prioritization of risks fol-
lowed by coordinated and economical application of resources to reduce,
monitor, and control the probability and / or impact of unfortunate events’
(Hubbard, 2020, p. 11).
Shorter definition: ‘Being smart about taking chances’ (Hubbard, 2020, p. 11).
The practical application of risk management is easier to discuss if risk itself is
broken into its component parts. That is, the first component is the potential loss,
disaster or other undesirable event. This could also be called a hazard or a potential
source of harm. The second component constitutes those threats leading to, or
causes of, the undesirable event, and the third component consists of the conse-
quences resulting from the undesirable event occurring. The relationship between a
cause and an undesirable event is typically represented as a discrete probability, or
likelihood over a given time period (e.g., days, weeks, years etc) or over a given
number of occurrences (e.g., number of launches). A risk statement typically
expresses each of these components; for example, there is a chance that poor
weather (cause) could result in a launch delay (undesirable event), resulting in a loss
of forecast revenue (consequence).
The likelihood is a discrete probability because the cause either results in the
undesirable event occurring over the specified time period (or number of occur-
rences) or it does not. It is common practice to define the likelihood of a given
undesirable event occurring through qualitative descriptors such as very unlikely,
unlikely, probable, almost certain etc. As noted by Hubbard, use of qualitative
descriptors can lead to ambiguity and misrepresentation of information intended to
support decision making. With respect to likelihood for example, consider an event
that has historically occurred once a century. What is the likelihood of the event
occurring? If you are interested in the likelihood of the event occurring on a given
4 J. A. Dennerley et al.

day, then you might say that it has a low chance of occurring. If you are interested
in how likely the event is to occur over a 100-year period, then you might say that
the event has a high or very high chance of occurring. Similarly, you may be inter-
ested in the likelihood of an event occurring over a given number of launches as
opposed to a time period. Either way, it is clear that a statement that the event has
1% probability of occurring in a given year, is more meaningful than a statement
that the likelihood is low.
The relationship between the undesirable event and the consequence is typically
represented as a continuous probability, that is, if the launch is delayed, loss of rev-
enue could range from $10,000 to $10,000,000. The combination of the likelihood
of an event occurring, and the associated range of possible consequences is often
assessed using simulations (such as Monte Carlos) and probability distributions. As
noted in Hubbard’s definition, risk management is the act of identifying, assessing
and controlling the risks. So, the management of risk generally results in the appli-
cation of one or more controls that either reduce the likelihood of the risk occurring
or reduce the impact (consequences) if the risk does occur. For example, applying a
control that reduces the likelihood of an undesirable event occurring from .01 (or
1%) per year to .001 or (0.1%) per year, can be meaningfully represented as reduc-
ing the likelihood of an event occurring from once every 100 years to once every
1000 years. Similarly, reducing the likelihood of an event occurring from 1% per
launch to 0.1% per launch means that you would expect to see the event happen
once every 1000 launches instead of once every 100 launches.
More often than not, a control that reduces the likelihood of the undesirable event
occurring does not reduce the consequence and vice versa. Consider, for example,
insurance. The act of taking out insurance in no way reduces the chance of launch
failure, but it may reduce the financial impact resulting from dealing with other
consequences (loss of life, environmental damage, fines from legal non-compliance
etc). Similarly, multiple redundant systems may reduce the likelihood of launch
failure in the first instance, however if the launch does subsequently fail, the conse-
quences may still be the same. So, risk management aims to first understand the
risk, second, to eliminate a given risk where possible, third to reduce the likelihood
of a risk occurring to a level deemed acceptable and fourth, to reduce the impact of
the risk, should it occur, to a level deemed acceptable. What is deemed as acceptable
depends on numerous factors, including legal requirements and standards, the appe-
tite for risk of the organisation’s leaders and so on.
Actual tools and techniques used to assess risk depend greatly on the context of
risk and will not be covered in this book. Typical pitfalls in risk1 management are
also suitably covered elsewhere (Hubbard, 2020; Cox, 2008; Kaplan & Mikes,
2012); and will not be addressed in this book, with one notable exception. An under-
standing of context is fundamental to all risk management and consequently, issues
of context will be addressed.

1
Issues include the use of inappropriate or ineffective techniques as well as not addressing cogni-
tive biases etc.
1 An Introduction to Risk Management in Outer Space Activities 5

A failure to establish the context for risk can lead to issues highlighted by Kaplan
and Mikes (2012), where organisations have a tendency to manage risks in function-
ally independent silos (the function trap of risk management). For example, a com-
pany involved in the placement of satellites into outer space requires fit-for-purpose
launch vehicles operated by competent people. This type of enterprise is exposed to
many types of risks. Using the operation of a launch vehicle as an example, risk can
be considered through multiple lenses. There are technical risks associated with
poor rocket design, safety risk with crew members operating and maintaining the
vehicle, environmental and reputational risk through potential fuel spill from faulty
components, operational risk associated with delays to the launch schedule if the
vehicle was unserviceable, and as the launch vehicle generates the company’s rev-
enue, there could be financial risk stemming from inability of the launch due to
inoperable subsystems or through compensation pay-outs and fines due to legal
non-compliance. In this scenario, the term risk is used in multiple contexts which
represent “functional” lenses. However, although these “functional” views of risk
can give an understanding of the areas of expertise required to manage risk, these
areas should not be seen as independent from each other. Rather than developing
independent technical, safety, environmental, reputational, operational and financial
risk management systems; organisations would benefit from an overarching risk
management system that understands where and when these functional consider-
ations must be applied. In addition, the types of controls put in place to manage the
risk will be dependent on context. To assess the various risk management contexts
associated with space activities, we need to first define what we mean by space
activities and subsequently, what we mean by outer space.

1.3 What Are Space Activities?

Space activities are any human activities conducted in, having an effect in, or
intended to have an effect in the outer space domain. They typically encompass a
range of governmental and non-governmental organisations, activities and pro-
cesses that produce objects intended to go into an orbit around the Earth and which
provide services that are accessed and consumed by end-users on Earth. Space
organisations, activities, processes and objects are broadly categorized as either
civilian or military in nature. In reality, however, the distinction between the two can
sometimes become blurred. This is because the products and services derived from
space industry technologies typically have use and application in both a civilian and
military setting (European Commission [EC], 2018). This is known as dual-use, and
a large majority of space technology could be characterised as being dual-use
(Johnson-Freese, 2018, p. 435). Nevertheless, space objects will typically perform
a function whilst in outer space, which will have an effect either in that domain, in
the Earth’s atmosphere or on and around the Earth’s surface. Indeed, much of what
occurs in outer space has direct relevance and significance in a terrestrial setting.
This point is perhaps best demonstrated by the role played by satellites. A satellite
6 J. A. Dennerley et al.

is a human-made object placed in an orbit around the Earth which can serve a vari-
ety of different purposes. A satellite’s purpose will usually be the provision of a
specific service, application or capability. These include the facilitation of satellite
internet, communications and telephony services, GPS navigation and tracking, sat-
ellite television and radio, weather forecasting services, information related to the
management of natural disasters, insights relevant to minerals exploration, urban
and land development services as well as astronomical observations and measure-
ments. In addition, satellites capture and transmit a variety of data sets and data
types related to Earth observation and remote sensing imagery, meteorology, epide-
miology, hydrology, climate and environmental sciences as well as conducting veg-
etation and forestry assessments (National Aeronautics and Space Administration
[NASA], 2017; Union of Concerned Scientists, 2015; Dennerley, 2018, p. 283).
Taking a step back, space activities in the space industry have traditionally been
divided into three main segments. These are:
(i) spacecraft, satellite and payload manufacturing, including associated equip-
ment manufacturing, known as the space segment;
(ii) the launch of the aforesaid space segment’s objects into orbits around the
Earth, including all associated launching activities, known as the launch seg-
ment; and
(iii) the operation and support of the aforesaid space segment’s objects via ground-­
based systems, known as the ground segment.
These three segments have historically comprised much of what would encom-
pass space activities, and traditionally would only have been undertaken by a small
group of space-faring States or corporations that had the scientific capability, politi-
cal will and dedicated budgets and resources to undertake such activities. Today,
however, new space actors, different types of space activities or new ways of con-
ducting the traditional space industry segments have emerged and are now becom-
ing the norm. This is largely driven by the increasing commercialisation, privatisation
and governmental outsourcing of certain space activities. As of 2018, the global
space industry was estimated to be worth approximately USD $360 billion (Bryce
Space and Technology, 2018). Of this number, one quarter is attributable to govern-
mental spending2 and three quarters is attributable to the private sector commercial
revenues that flow from satellites and their related products and services (Bryce
Space and Technology, 2018). Indeed, the civilian or commercial space industry
landscape largely comprises the products, services, applications and capabilities
derived from satellites (Bryce Space and Technology, 2017, p. 5). Recently how-
ever, the civilian space industry landscape has become a more diverse arena com-
prising new and emerging space activities that don’t neatly fall into one of the
traditional space, launch or ground segments. Some of these new and emerging
space industry activities include:

2
As of 2017, approximately 50 States have resources and budgets dedicated to space activities
(Bryce Space and Technology, 2017, p. 1).
1 An Introduction to Risk Management in Outer Space Activities 7

(i) space support services, which comprise those services that support other
space activities via the provision of professional and advisory services rele-
vant to a particular discipline or field (for instance financial, legal, consul-
tancy services);
(ii) space and satellite insurance, which comprise the provision of insurance
products to space actors to protect them, and other parties, by way of certain
guarantees and the accessing of compensation in the event of damage, harm
or loss that arises in the course of conducting space activities;
(iii) space and satellite data, which comprise the acquisition, transfer, storage,
processing, analysis, archiving, visualisation and consumption of data derived
from instrumentation and equipment onboard spacecraft, satellites or pay-
loads that are conducting on orbit operations;
(iv) space industry groups, which comprises those associations, consortiums or
organisations that connect space actors and promote the development and
growth of the global or a specific State’s domestic space industry, or a subset
of the industry;
(v) academic research and development, which comprise those companies or
organisations (for instance universities) undertaking activities that seek to
innovate and improve existing space activities or technologies, or introduce
new scientific or commercial space-related products, services, applications
and capabilities;
(vi) space cyber security, which comprise those activities designed to engineer
and harden the electronic, network and computational elements of space sys-
tems (for instance spacecraft, satellites, payloads, ground stations and tele-
communications links) and protect them from malicious attacks that seek to
disable the space system and / or access its data;
(vii) space resource exploitation and space mining, which comprise those activi-
ties that seek to extract valuable minerals or materials from objects in the
outer space domain (for instance from asteroids or the Moon);
(viii) space manufacturing, which comprises the manufacturing of goods in the
outer space domain, which are undertaken there because of the unique physi-
cal and environmental conditions associated with outer space and celestial
bodies; and
(ix) space tourism, which comprises those human spaceflight activities done for
recreational or entertainment purposes.
It is important to remember that there is not always a strict separation between
the aforesaid traditional, new and emerging space industry activities because in cer-
tain circumstances they may be undertaken in conjunction or may overlap. What is
interesting about this collective grouping of space activities is that at present, many
of these activities are conducted by, or involve, companies, universities, industry
groups and even individuals (European Space Agency [ESA], 2016). These new and
emerging space industry activities and trends fit into a phenomenon known as Space
4.0 (ESA, 2016). Space 4.0 is a term used to describe the current space epoch. It is
characterised by the aforesaid new and emerging space industry activities, and also
8 J. A. Dennerley et al.

features increasing interaction between governmental and non-governmental space


actors (ESA, 2016), as well as increased international and multi-disciplinary coop-
eration. The new and emerging space activities of Space 4.0 present us with novel
contexts in which risks can and will arise. Therefore, understanding the concept of,
and undertaking the practice of, risk management in these novel contexts is more
important than ever.

1.4 What and Where Is Outer Space?

As mentioned above, risk management as a concept and practice will apply differ-
ently in different contexts. Context in this sense includes the specific circumstances
that cohere to form the places, settings or surroundings in which an event will occur
or unfold. Identifying and understanding the specific contexts to which risk man-
agement will apply is critical to its overall success. Therefore, the concept of risk
management and space activities will logically include reference to the outer space
domain as a context in which risk management can apply. Yet pinpointing what, and
where, the outer space context is has proved to be a difficult and contentious issue.
The core of the issue relates to both the definition of outer space, and its demarca-
tion from airspace. Both issues are linked, but we will first turn to the latter.
The Earth is surrounded by a blanket of gasses called the atmosphere. The atmo-
sphere is generally thickest at the Earth’s surface and becomes thinner the farther
one moves away from the planet’s surface. Due to the fact that the Earth’s atmo-
sphere is adjacent to the planet’s surface, it has been broadly assumed historically
that this region fell within the control of those who inhabited the subjacent surface.
Indeed, this belief has found its way into international law where a State’s territory
and the airspace above it, both fall within the power or authority of that sovereign
State (Cheng, 1983, p. 91). This point is articulated by Article 1 of the Chicago
Convention on International Civil Aviation3 which details that those States party to
the Convention recognise that other States have ‘complete and exclusive sover-
eignty over the airspace above [their] territory’ (International Civil Aviation
Organization, 2006).4 A logical question follows; to where, or how far, does this
sovereignty extend?
One line of reasoning purports that, in-line with the legal status that airspace
holds under international law, a State’s sovereignty extends to the point or boundary
at which airspace is no more. This would presumably be a location at which the
Earth’s atmosphere is no longer present or detectable. From this, we glimpse the

3
This point of law was first articulated by Article 1 of the 1919 Paris Convention on the International
Regulation of Aerial Navigation, which was later superseded by the Chicago Convention on
International Civil Aviation (Cheng, 1983, p. 91).
4
The Chicago Convention on International Civil Aviation came into force on 4 April 1947, and at
the time of writing this chapter it has 193 parties that have either ratified it, or who have agreed to
adhere to it.
1 An Introduction to Risk Management in Outer Space Activities 9

possibility of identifying, at least from a legal perspective, where airspace might


end. However, locating where airspace ends has proved difficult to ascertain.
Scientific estimates suggest that the outermost layer of the Earth’s atmosphere is
approximately 965 km away from the planet’s surface (National Oceanic and
Atmosphere Administration [NOAA], 2016). For several important reasons, con-
cluding that this distance includes within it a State’s airspace raises various objec-
tions. These include that States may not agree upon an upper limit to their sovereign
airspace, the lowest record perigee of an orbiting satellite is approximately 160 km
(Diederiks-Verschoor & Kopal, 2008, p. 17) meaning that certain objects orbiting at
altitudes lower than 965 km may violate or infringe upon a States’ airspace, and
finally that fixing a boundary line as high as this might constrain spatial activities,
such as commercial spaceflight (McDowell, 2018, p. 668).
Turning elsewhere, another candidate distance that has been suggested as a pos-
sible boundary line between the Earth’s atmosphere and outer space is the Kármán
Line.5 The Kármán Line is situated 100 km above the Earth’s mean sea level. At this
height, the atmospheric gasses surrounding the Earth become too thin to support
aerodynamical lift in most aircraft (NOAA, 2016). It has been noted that current,
and likely future, civil aircraft will not be able to operate at altitudes higher than
approximately 100 km (United Nations Committee on the Peaceful Uses of Outer
Space [UNCOPUOS], 2020, p. 4). This means that from an engineering point of
view, most aviation activities will occur in the region below 100 km in altitude.
There is a lack of international agreement, however, as to whether this region cor-
relates to the airspace above a State’s territory, so as to place an upper limit or cap
on a State’s sovereignty. What the term airspace refers to, and what lies within its
extension, are critical questions that air law has not defined or settled upon
(Diederiks-Verschoor & Kopal, 2008, p. 15). It is reasonable to assume that airspace
has some sort of connection to outer space, but the quest to discover how outer
space should be defined and demarcated by way of a reference to airspace has thus
far not proved to be effective.
At this point it is important to reaffirm that there is no international agreement as
to the demarcation of airspace from outer space, nor is there a definition of outer
space under general international law or space law, as a specialised regime of inter-
national law (United Nations Committee on the Peaceful Uses of Outer Space
[UNCOPUOS], 2012, p. 2). In all five United Nations (UN) multilateral space trea-
ties (UN space treaties),6 which are the primary sources of international space law,

5
The Kármán Line derives its name from the Hungarian-American aerospace engineer Theodore
von Kármán.
6
The UN space treaties include: Treaty on Principles Governing the Activities of States in the
Exploration and Use of Outer Space, Including the Moon and Other Celestial Bodies (Outer Space
Treaty) 1967, 610 UNTS 205; Agreement on the Rescue of Astronauts, the Return of Astronauts
and the Return of Objects Launched into Outer Space (Rescue Agreement) 1968, 672 UNTS 119;
Convention on International Liability for Damage Caused by Space Objects (Liability Convention)
1972, 961 UNTS 187; Convention on Registration of Objects Launched into Outer Space
(Registration Convention) 1975, 1023 UNTS 15; Agreement Governing the Activities of States on
the Moon and Other Celestial Bodies (Moon Agreement) 1979, 1363 UNTS 3.
10 J. A. Dennerley et al.

the term ‘outer space’ is not defined, nor is outer space differentiated from airspace.7
Nevertheless, a State’s sovereignty, whilst present in the airspace above its territory,
does not extend into outer space because outer space constitutes a different legal
regime (Diederiks-Verschoor & Kopal, 2008, p. 16). This definitional lacuna has not
prevented States, and more recently corporations, from conducting activities, like
operating satellites, in a region broadly considered to be outer space. The character-
istics of this domain such as its boundaries, extent and content, from a scientific and
legal perspective, are less than certain. Nevertheless, by identifying the various
characteristics of airspace and outer space, specifically their boundaries or edges, it
has been hoped that a definition of these domains might emerge. It could be argued
that by identifying the boundary separating airspace from outer space, via scientific
or legal consensus, a definition of outer space could be crafted. Outer space in this
sense would be the antithetical to airspace. Both are mutually incompatible and the
definition of one, necessarily excludes the other. However, perhaps identifying the
demarcation of airspace from outer space is not the most effective way to determine
what and where outer space is. Rather, a possible solution might just focus on those
activities considered to be in outer space. International air and space law expert
Professor Bin Cheng highlights that by conducting spatial activities such as the
operation of satellites at certain perigee altitudes, space-faring States have willed
that certain activities do indeed take place in outer space, despite lacking a precise
definition of this location (Cheng, 1983, p. 95). Explained another way, the place
where certain objects reside, such as human-made satellites in orbit around the
Earth, are considered as occurring in outer space. This entails the notion that where
these sorts of spatial activities take place, airspace, and therefore air law, will not
enter into, interfere with, or exceed in height (Cheng, 1983, p. 95). This conclusion,
that by their very nature, certain activities take place in outer space, has seemed
acceptable to most States (UNCOPUOS, 2020, p. 4).
Regardless of whether one attempts to define and delimit airspace from outer
space based on some boundary distance line or derived from the location of objects
or activities that are considered to take place in outer space, both of these lines of
reasoning are imperfect. Contrasted to this, another possible way forward is to ask
what the function and purpose of the object or activity is. From a legal point of view
this seems to make sense, considering that space law, either international or domes-
tic, serves to create a legal regime that regulates objects and activities that do, or that
are intended to have, an effect in outer space, or which relate to this domain. This
approach, termed the functional approach, redraws the ‘boundary line’ of outer
space, so as to include the ‘circumstances [that surround …] activities in outer
space’ (Diederiks-Verschoor & Kopal, 2008, p. 18). Like all approaches that attempt
to tackle these issues, the functional approach is not without criticism (see,
McDowell, 2018, p. 668). Unlike the boundary distance line approach, which if
definitively identified and agreed upon would enable the clear and unambiguous

7
The UN space treaties do not derogate from the primary rule of international law that State’s
maintain sovereignty over the airspace above their territory, per Article 1 of the Chicago Convention
on International Civil Aviation (Cheng, 1983, p. 92).
1 An Introduction to Risk Management in Outer Space Activities 11

determination of when an object or activity was in outer space, the functional


approach suffers by inarticulately scoping what is meant by the function, purpose or
circumstances associated with space objects and activities. For example, an essen-
tial component of a spacecraft or satellite system is the ground segment. The ele-
ments of a ground segment are built, operated and managed on the Earth’s surface,
despite it having certain effects on objects in outer space. Under the functional
approach, it could be argued that ground segments fall within the ‘circumstances’
that surround, support and enable space-based objects to function and space activi-
ties to occur. However, it is difficult to know whether all the elements of a ground
segment, such as terrestrial telecommunications networks present at the ground seg-
ment, fall entirely within the relevant ‘circumstances’, and whether an element can
have multiple different functions or purposes, or whether the nature of the object or
activity must solely relate to outer space.
After assessing the divergent viewpoints that relate to the definition and demar-
cation of airspace from outer space, a reasonable conclusion might be that obtaining
a single agreed upon definition of what and where outer space is will not be achiev-
able. Indeed, different professions and disciplines, such as aerospace engineers or
international lawyers may simply need to define and delimit these two domains
based upon their own specific set of circumstances and needs (McDowell, 2018,
p. 669). For the purposes of this book, the definition and demarcation of air space
from outer space can be looser and more inclusive than the aforesaid approaches
might seek to mandate. This is because the focus of this book is risk management
and space activities. From this book’s point of view, outer space is a broad context
to which the concept and practice of risk management can apply. As explained
above (Sect. 1.3), space activities include any human activities conducted in, having
an effect in, or intended to have an effect in the outer space domain. This includes
activities like the design, manufacture, launch, operation and retirement of an object
like a satellite. In essence, the entire space project or mission lifecycle, from the
terrestrial activities to the spatial, creates and contains places, settings or surround-
ings in which risks can and do occur or unfold, therefore necessitating the need for
risk management. This book will not attempt to define outer space, but instead focus
on explaining how risk management relates to specific space activities and more
broadly to outer space.

1.5  ow Does Risk Management Relate to Space Activities


H
and Outer Space?

Clearly there are numerous activities relating to outer space in which risks can man-
ifest. The remaining chapters of this book will provide a more detailed overview of
risk considerations from some of these activities. Let us start by looking at six broad
categories consistent with space activities: getting into outer space, being in outer
12 J. A. Dennerley et al.

space, removing objects from outer space, use of spaceborne capabilities, losing the
spaceborne capability, and the study of outer space.
Risks considerations associated with getting into space could include anything
from poor design of launch vehicles, through to the build, launch and placement of
payloads into orbit, such as weather satellites. Both the Challenger Space Shuttle
disaster in 1986 and the Columbia disaster in 2003, provide sobering reminders of
the types of consequences of getting risk management wrong in the design, build,
test and launch of space vehicles.
Risk considerations associated with being in outer space, could include the man-
agement of possible collisions between two or more objects (particularly relevant
when considering space debris), or even the loss of useable space itself as certain
areas of the outer space domain are becoming congested and contested. The latter
point may seem counter intuitive given the size of outer space, however, like most
natural and freely available resources, long-term pressures and over utilisation can
cause scarcity which can lead to conflict. Whilst the space around the Earth is a vast
region, certain areas are more valuable than others. Geostationary Orbit (GEO) has
the most desirable orbital characteristics for the placement and operation of certain
types of satellite, for instance communications and weather satellites (Howell,
2015). GEO is a prime example of over utilisation and the potential overcrowding
of regions in outer space as it already contains a large number of satellites which
inhabit and use a finite number of orbital slots. Orbital slots are regions in GEO
allotted for satellites. Currently, there are 560 satellites in GEO (Union of Concerned
Scientists, 2019). GEO as an orbital location, however, can sustain roughly 1800
satellites which must remain within their assigned orbital slot (Howell, 2015).
Whilst this upper limit may seem large, it is not infinite. As a result of the rising
levels of risk associated with overcrowding, positioning and potential collisions that
may lead to loss of service and revenue, Low Earth Orbit (LEO) has become more
attractive as an alternative to GEO in certain circumstances.
Removal of objects from space could occur through, for example, the orbital
decay of a satellite (for instance when the space station Skylab returned to the Earth
in 1973), or the intentional removal of space debris in an attempt to remediate the
space environment. Either way, there are potential consequences associated with
objects falling back to Earth or with attempting to remove objects such as space
debris from an increasingly overcrowded domain. Conversely, not removing objects
like space debris could itself present risk to future space operations. This under-
scores the fact that risk management is essentially about trade-offs, and that there is
often not a straightforward answer about what should be done to manage risk.
The way in which spaceborne capability is used reveals a vast array of possible
risks dependent on one’s context. For example, a spy satellite provides advantages
to the country launching and operating it but may not be seen in a favourable light
by other nations. Privacy could be put at risk intentionally or even unintentionally
through the use satellite imagery, which is ever increasing in resolution (consider
what you can see in your neighbour’s backyard on Google Maps). Even more con-
cerning is the potential for cyber attack on communications satellites, which carries
the potential of far reaching consequences for individuals, organisations and nations
1 An Introduction to Risk Management in Outer Space Activities 13

alike (see Chap. 6). Consider also a scenario in which a nation weaponised space-
borne capability with the ability to disrupt space activities being conducted by other
countries, or even to conduct a direct strike against the Earth’s surface.
This last example demonstrates that we can imagine some catastrophic scenarios
where spaceborne capability is misused, but what about scenarios where we lose
capabilities that we have become reliant on? Consider how many systems on Earth
rely on GPS for example, or how many industries rely on satellite communications.
Other spaceborne sensors that measure variables such as sea surface temperature
and sea surface altimetry have been key drivers in the increasing accuracy of weather
forecasting services, including tropical cyclone prediction, and provide fundamen-
tal inputs into climate research. The losses of the Glory Satellite in 2011 and the
Orbiting Carbon Observatory in 2009, both due to failures of the launch vehicle,
were major setbacks to atmospheric observation and research. The loss of space-
borne capabilities that we have come to rely on could be devastating to our current
way of life.
Risks are even evident in space related activities conducted from the ground.
Astronomy, for example, is the science of observing outer space. From Galileo to
Kepler to Newton to Hubble, the contribution that astronomy has made to our
understanding of the nature of reality and the physical universe cannot be under-
stated; yet the significant increase in light pollution over the last century is making
observation from ground-based locations more and more difficult.
The broad categories above give a sense of the breadth of interest in the manage-
ment of risk with respect to space-based activities and, as noted earlier, interest
could come from members of international organisations, national and state govern-
ments, executives in corporations which build launch vehicles, to professionals in
disciplines like astronomy, engineering, law and so on. How do each of these inter-
ested parties begin in the journey of risk management? The answer is by first estab-
lishing their context. To provide an approach to help in this endeavour, and to
provide a convenient way to situate the remaining chapters of this book, we will
describe a framework that acts as a starting point to establishing one’s risk context.
This framework is referred to as the Layers of Control.

1.6 The Layers of Control

Establishing context is the first and arguably most important aspect of risk manage-
ment. Although multiple factors contribute to context, the Layers of Control
Framework,8 represented in the figure below, provides a useful starting point to situ-
ate accountabilities of risk managers, which in turn gives an understanding of the
types of risk controls that a risk manager is likely to implement based on their

8
Developed by the Australian company ALARP Solutions Pty Ltd. The Layers of Control
Framework has been published with permission by ALARP Solutions Pty Ltd.
14 J. A. Dennerley et al.

c­ontext. The framework was originally developed to help the Australian


Government’s Department of Defence and other government organisations estab-
lish appropriate accountabilities for governance, risk and assurance activities, by
asking a series of questions:
–– Fifth (5th) Layer of Control. Do I specify international requirements through a
recognised international body?
–– Fourth (4th) Layer of Control. Do I specify legal requirements on behalf of the
nation or State?
–– Third (3rd) Layer of Control. Do I specify Enterprise wide requirements, and / or
determine and interpret applicable legal requirements, on behalf of the Enterprise?
–– Second (2nd) Layer of Control. Do I develop policies or systems of control, or
prescribe standards to meet the Enterprise and / or legal requirements?
–– First (1st) Layer of Control. Do I follow policies, utilise systems of control or
implement standards as directed?
As represented in Fig. 1.1 below, the types of controls a risk manager is likely
to implement are based on which Layer of Control they are operating in. For
example, those working at the Fifth Layer of Control are likely to be looking for
international agreements, conventions and treaties; whereas a launch vehicle
designer at the First Layer of Control would be applying the appropriate stan-
dards to ensure the structural integrity of the vehicle is maintained across all
aspects of its operating profile. Understanding where one sits within the Layers

Layers of Control Framework


4th Layer of Control
Context: National & State-
Based Settings.
Types of Controls:
Legislation, Regulations,
Policies, Industry
5th Layer of Control Standards, Codes of
Context: International & 5th Practice, Ordinances etc.
Global Settings.
Types of Controls: Treaties,
3rd Layer of Control
Customs, Conventions,
Resolutions, Codes of Context: Enterprise Wide
Conduct, International 4th Direction & Control.
Standards etc. Types of Controls: Internal
Regulations, Directives,
Instructions, Internal
Policies etc.
1st Layer of Control 3rd
Context: Organisational
Management of Assets
and Services. 2nd Layer of Control
Types of Controls: Physical
Controls, Admin Controls,
2nd Context: Organisational
PPE, Order Instructions & Direction & Control with
Procedures (OIP) etc. Respect to Assets and
Services.
1st Types of Controls: Policies,
Frameworks, Standards,
Systems, Models etc.

Fig. 1.1 The Layers of Control Framework


1 An Introduction to Risk Management in Outer Space Activities 15

of Control typically provides clarity with respect to one’s role in managing risk.
Using a simple analogy, checking the tyre pressure on a forklift may be an
appropriate control for a forklift driver, but is probably inappropriate for the
CEO of a transport company, who is more focused on understanding if appropri-
ate systems of control are in place to safely deliver goods in a way that maxi-
mises profit.
The Layers of Control framework is applied in this book to support two objec-
tives. Firstly, it helps provide the authors a basis upon which to specify a target
reader. A discussion on risk relating to, for example, space debris, could cover a
spectrum of considerations from international conventions through to specific tech-
niques and systems to be used in the debris removal process. By specifying that a
chapter in this book is focused on the Fourth and Fifth Layers of Control, it high-
lights that the chapter is primarily speaking to international and national (govern-
ment) policy makers. Secondly, it provides the reader a basis to situate themselves
with respect to the discussion in each chapter. In the example above, there may be
interest in particular readers who design and operate systems to remove space
debris. By situating themselves in the First and Second Layers of Control, they can
get benefit from an understanding of international or national considerations that
may ultimately result in requirements they must comply with, but also understand
that the particular content is not directed to their risk management context. The
Layers of Control Framework is used below as the starting point to give context to
both the chapter author and the reader.

1.7 Different Risk Contexts

As explained above, the scope of intended readers for this book is broad, and it is
generally intended for those with an interest in the subjects of both risk manage-
ment and space activities. However, each chapter addresses particular areas of risk
consideration which have a more specific readers in mind. The Layers of Control
framework is intended to prompt the reader into asking the question; what is the
context in which I am operating, and therefore what are my controls for risk man-
agement? Controls will differ depending on one’s context. Each of the book’s
chapter relates to different risk contexts and therefore has relevance to different
layers in the Layers of Control framework. Table 1.1 below is intended to guide
the reader by explaining what Layer(s) of the Layers of Control framework are
addressed in the following chapters, and who the intended reader for each
chapter is.
16 J. A. Dennerley et al.

Table 1.1 Layers of Control relevant to each chapter


Layer(s) of
Chapter control addressed
number Chapter name in chapter Intended reader for chapter
2 The Commercialisation of The main focus is Companies undertaking space
Space: An Overview of Legal Layer 4, with a activities in Australia and New
Risks and Considerations. lesser focus on Zealand, space law practitioners.
Layer 3.
3 Risk Management Through The main focus is Space law practitioners, legal
New Zealand’s and on Layer 4, with researchers, space policy drafters
Australia’s Space Legislative a lesser focus on and advisors, companies
Frameworks. Layers 5 and 3. undertaking space activities in
Australia and New Zealand.
4 Transferring Risk Through The main focus is Companies undertaking space
Insurance Law: Insuring Layers 4 and 3. activities in Australia and New
Space Activities in Australia Zealand including launch
and New Zealand. activities, insurers and insurance
underwriters, space law
practitioners.
5 Managing the Risks The main focus is Space policy drafters and
Associated with Space Layers 5 and 4, advisors, space law practitioners,
Debris. with a lesser companies undertaking space
focus on Layer 3. activities in Australia and New
Zealand.
6 Managing the Cyber-Related The main focus is Space policy drafters and
Risks to Space Activities. Layer 4, with a advisors, organisations involved in
lesser focus on space activities from a cyber
all other Layers. security perspective.
7 Light Pollution as a Risk for The main focus is Lighting engineers, local
Astronomical Research and Layers 5, 4 and government officials who control
How to Manage it. 3. street lighting, astronomers
(professional and amateurs),
tourism operators who are
interested in astrotourism.
8 New Risks of Future Lunar The main focus is Technical organisations sending
Landings. Layers 3, 2 and landers to the Moon, space policy
1. drafters and advisors.

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International Civil Aviation Organization. (2006). Convention on International Civil Aviation (9th
ed.). Doc 7300/9. https://www.icao.int/publications/Documents/7300_9ed.pdf
Johnson-Freese, J. (2018). Space and national security. In D. S. Reveron, N. K. Gvosdev, &
J. A. Cloud (Eds.), The Oxford handbook of U.S. national security. Oxford University Press.
https://doi.org/10.1093/oxfordhb/9780190680015.013.36
Kaplan, R. S., & Mikes, A. (2012, June). Managing risks: A new framework. Harvard Business
Review. https://hbr.org/2012/06/managing-­risks-­a-­new-­framework
McDowell, J. C. (2018). The edge of space: Revisiting the Karman line. Acta Astronautica, 151,
668–677. https://doi.org/10.1016/j.actaastro.2018.07.003
National Aeronautics and Space Administration. (2017, February 9). What is a satellite? https://
www.nasa.gov/audience/forstudents/k-­4/stories/nasa-­knows/what-­is-­a-­satellite-­k4.html
National Oceanic and Atmospheric Administration. (2016, February 22). Where is space? https://
www.nesdis.noaa.gov/content/where-­space
Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space,
Including the Moon and Other Celestial Bodies (Outer Space Treaty) 1967, 610 UNTS 205.
Union of Concerned Scientists. (2015, January 15). What are satellites used for? https://www.
ucsusa.org/resources/what-­are-­satellites-­used#.WneqtJP1X-­Y%EF%BB%BF
Union of Concerned Scientists. (2019, March 31). UCS satellite database. https://www.ucsusa.
org/resources/satellite-­database
United Nations Committee on the Peaceful Uses of Outer Space. (2012, February 21). National
legislation and practice relating to the definition and delimitation of outer space. UN Doc. A/
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summary on the consideration of the question on the definition and delimitation of outer space.
UN Doc. A/AC.105/769/Add.1.
Chapter 2
The Commercialisation of Space:
An Overview of Legal Risks
and Considerations

Andreas K. E. Sherborne

2.1 Introduction

Since the early years of space exploration and development, space has primarily
been the domain of sovereign state actors. Governments have funded and facilitated
space activities for specific state purposes, including telecommunications, research
and development, and defence. Concurrently, a network of international space law
treaties and principles was created to regulate the activities of sovereign state actors
in space. However, in recent years, there has been an increase in the number of pri-
vate commercial entities undertaking space activities. A viable and competitive
space economy has emerged, much in part to rapid technological advancements and
the reduction of financial barriers to entry. As these commercial entities navigate a
new domain, they will face new complex risks – both technical and legal. This chap-
ter specifically identifies those legal risks relevant to commercial ventures into
space, including regulatory risk and contractual risk with a focus on the laws appli-
cable in Australia and New Zealand.

The views of the authors are the authors’ alone and are intended to provide commentary and gen-
eral information, and do not represent the views of any organisation. This chapter should not be
relied upon as a substitute for professional legal advice or for any other purpose.

A. K. E. Sherborne (*)
Canberra, Australia
e-mail: info@gravitylawyers.co.nz

© The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2022 19
M. A. Pozza, J. A. Dennerley (eds.), Risk Management in Outer Space Activities,
Space Law and Policy, https://doi.org/10.1007/978-981-16-4756-7_2
20 A. K. E. Sherborne

2.2 The Modern Space Economy

On 30 May 2020, the Falcon 9 rocket launched from the Kennedy Space Centre in
Florida carrying a spacecraft with two astronauts into orbit (Wtize, 2020). The
rocket docked with the International Space Station, depositing the two astronauts,
and then returned to Earth, landing on a ship to be re-used for future spaceflight.
This launch not only represented a revival of American human spaceflight (the pre-
vious launch from the United States to the International Space Station occurred in
2011,1 and subsequent American space projects had been conducted by use of
Russian infrastructure),2 but the first launch undertaken as a collaboration between
a government agency and a private company.
In this emerging paradigm, space exploration is no longer the prerogative of
government actors. Rather, private industry streamlines commercial access to space
which is in turn leveraged by government agencies pursuing new space programs
and by the market providing space technologies and space derived goods and ser-
vices to consumers (Solomon, 2008). Indeed, space activities are expanding glob-
ally, with a record number of governments and commercial entities making
significant investments in space enterprises (OECD, 2019). Commercial on-earth
activities (‘downstream activities’) are increasingly derived from, and reliant upon,
satellite data which in turn contributes to the development of new markets in which
novel goods and services are supplied to increasing numbers of consumers (OECD,
2019). There is also increased competition and innovation in the space economy,
with newcomers to all segments of the space sector and technological advancements
disrupting incumbent providers (OECD, 2019). This record level of investment and
commercial activity has had a marked effect on the growth of the space economy,
which in 2019 was valued at USD366 billion (Satellite Industry Association [SIA],
2020). However, to understand the magnitude and nature of this paradigm shift, an
understanding of the historical context is required. This part now turns to examine
the emergence of a global space economy, primarily from the perspective of the
United States given its lead role in the development of a modern space economy.

1
STS-135 (ISS assembly flight ULF7) was the 135th and final mission of the American Space
Shuttle program.
2
Since the final Space Shuttle flight in 2011, NASA has purchased access to the Russian Soyuz
spacecraft for American crew transportation. In May 2020, NASA announced that negotiations had
been finalised with the Russian state space corporation Roscosmos for one seat on a Soyuz mission
scheduled for launch in late 2020 at a cost of USD90.25 million. It is expected that this will be the
last time NASA purchases access to space as commercial crew launches enter into regular service.
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 21

2.2.1  rom Public to Private: The Development


F
of the Space Economy

The twentieth century space race began in the context of the Cold War, with govern-
ment programs driven by intense technological and ideological competition between
the United States and the Soviet Union (Koman, 1994: Gabrynowicz, 2004; Brown,
2011). In October 1957, the Soviet Union successfully launched a small satellite,
Sputnik 1, into orbit. Only a few years later, in April 1961, Soviet cosmonaut Yuri
Gagarin became the first human in space, flying Vostok 1 on a one-orbit mission
around the earth. In reaction to these historic events, and the recognition that United
States space capability lagged behind that of the Soviet Union, the Kennedy admin-
istration made an ambitious commitment in 1961 to land an American on the moon
by the end of the decade (Koman, 1994, p. 43). To fulfil this commitment, the
National Aeronautics and Space Administration (NASA) began the implementation
of a national space program through government-owned and government-operated
space missions. Project Gemini, which cost in excess of USD5 billion, first drove
the major expansion of NASA’s operations, with the agency becoming a large, well-­
funded federal organisation,3 and ultimately acquiring a monopoly on all United
States space activities, with the exception of ballistic missiles and reconnaissance
satellites which remained within the remit of the United States Department of
Defense (Solomon, 2008). Project Gemini also achieved a number of successful
space flights, establishing the United States as the lead in the competition with the
Soviet Union for ‘space firsts’, and acting as a “technological bridge” (Solomon,
2008, p. 17) to NASA’s subsequent space program, Project Apollo. Following a
number of Apollo missions, both successful and unsuccessful, the United States
cemented its spacefaring dominance with the Apollo 11 rocket making a manned
lunar landing in July 1969, fulfilling President Kennedy’s mandate (Piantadosi, 2013).
A period of stagnation proceeded Project Apollo, which was terminated in 1972
after USD23.5 billion spent, launching 17 missions, and putting 12 astronauts on
the moon (Bilstein, 1989). The socio-political context had shifted in America. The
Vietnam War limited the capacity of the United States to commit the substantial
resources required to pursue new frontiers in space, while the civil rights movement
focused public attention on domestic issues rather than towards the United States
space program (Bilstein, 1989; Koman, 1994; Launius, 1994). In March 1970,
United States President Nixon announced that space exploration was no longer a
national priority, declaring that the federal government must “recognise that many
critical problems here on this planet make high priority demands on our attention

3
As Project Gemini progressed, the NASA budget grew rapidly. NASA’s budget was $966.7 mil-
lion in 1961, $1.825 billion in 1962, $3.674 billion in 1963, $5.1 billion in 1964, and $5.25 billion
in 1965, representing some 5% of the federal budget. NASA’s full-time employees increased from
10,000 in 1960 to more than 34,000 in 1965. Similarly, the number of employees working for
NASA contractors increased from 36,500 in 1960 to more than 370,000 in 1965 (Solomon,
2008, p. 17).
22 A. K. E. Sherborne

and our resources” (Nixon, 1970, p. 250). Despite waning political interest and
reductions in its budget, NASA continued on with a number of space programs,
including Skylab, Viking 1, Project Voyager, and Landsat (Launius, 1994,
pp. 98–100). Alongside these programs, NASA pursued a new ambitious objective
to secure routine access to space at a relatively economical cost. This objective took
the form of the Space Shuttle, which ultimately became the central component of
the United States space program in the 1980s, 1990s, and the first decade of the
twenty-first century (Solomon, 2008, p. 20).
Although much of the history of human space exploration is focused on the
space programs developed in the United States, other nation states have also pur-
sued their own domestic agendas, albeit to a lesser degree. The governments of the
United Kingdom, France, Canada and China all developed national space programs
in the 1950s (Wheeler, 2019; Rodriguez, 2015; Carminati, 2014; Evans, 2004;
Millard, 2005), with the governments of Japan and India following in the years
shortly after (Goswami, 2020; Yotsumoto & Ishikawa, 2019; Pant & Gopalaswamy,
2008). To varying degrees, these national space programs centred on the develop-
ment of satellites, rockets and spacecraft for purposes including research and devel-
opment, telecommunications, and military and intelligence applications. Nation
states also began to recognise the economic value in fostering the development of a
commercial space industry. In 1984, the United States Congress enacted the
Commercial Space Launch Act (CSLA), with United States President Reagan
remarking “one of the important objectives of my administration has been, and will
continue to be, the encouragement of the private sector in commercial space endeav-
ours” (Regan, 1984, p. 1). The CSLA made the United States Department of
Transportation (acting through the Office of Commercial Space Transportation) the
agency responsible for regulating commercial launches and facilitating the growth
of the commercial space industry. Other nation states also took steps to foster pri-
vate sector involvement in government-run space programs. For example, in 1974
the Canadian Government Ministry of State for Science and Technology issued its
‘Canadian Policy for Space’ which, amongst other things, “specifically identified
the need to support the development of the Canadian space industry by moving
government space research and development out into industry” (Evans, 2004, p. 31).
Although these measures recognised the importance of private sector involve-
ment in space activities, a number of mergers and acquisitions of aerospace compa-
nies during the 1980s and 1990s created a space sector dominated by a handful of
large multinational giants (Gomes et al., 2013). These aerospace companies solidi-
fied their position in the market by securing valuable government contracts for the
provision of space related products and services. In this environment there was little
room for smaller aerospace firms to gain market share, for commercial competition,
or for innovation (Solomon, 2008, p. 27). The dominance of these larger aerospace
firms also meant the United States government had little capacity to renegotiate
terms, to seek cost reductions to expensive contracts, or to switch to alternative
aerospace providers (Solomon, 2008).
This model of limited and rigid private sector involvement began to shift when,
in January 2004, United States President Bush delivered a speech outlining a
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 23

reimagined space exploration plan for the United States in which humans would
return to the moon, and in the future, continue to Mars. At the same time, a
Presidential Commission was established “to obtain recommendations concerning
implementation of the new vision for space exploration activities of the United
States…” (the Aldridge Commission) (Bush, 2004, p. 175). The Aldridge
Commission was given a broad mandate to advise the United States Government on
its new national space exploration policy and to recommend, amongst other things,
how the United States Government could use private sector and international par-
ticipants in its implementation (Bush, 2004). In June 2004, the Aldridge Commission
published its report and gave two key recommendations: first, the need to restruc-
ture and transform NASA; and second, the need to promote new models of private
sector involvement (President’s Commission on Implementation of United States
Space Exploration Policy, 2004). The Aldridge Commission criticised NASA’s tra-
ditional approach to private industry where contracts prone to cost overruns and
delays were solely awarded to large aerospace companies. Recommendation 3-1 of
the Aldridge Commission envisaged a new model of private sector involvement
characterised by diverse and competing commercial interests:
[the] Commission recommends NASA recognize and implement a far larger presence of
private industry in space operations with the specific goal of allowing private industry to
assume the primary role of providing services to NASA, and most immediately in accessing
low-Earth orbit. In NASA decisions, the preferred choice for operational activities must be
competitively awarded contracts with private and non-profit organizations and NASA’s role
must be limited to only those areas where there is irrefutable demonstration that only gov-
ernment can perform the proposed activity (President’s Commission on Implementation of
United States Space Exploration Policy, 2004, p. 19).

The Aldridge Commission summised that increasing private sector involvement


would not only create employment opportunities, but also reduce production costs
and accelerate technological developments. A robust private sector would in turn
assist the United States in implementing its own ambitious space programs and poli-
cies. Reflecting this basis, the 2005 enactment of the NASA Authorization Act
directed NASA to “develop a commercialization plan to support the human mis-
sions to the Moon and Mars, to support low-Earth orbit activities” (NASA
Authorization Act of 2005, s 108).
In November 2005, NASA began to implement the recommendations of the
Aldridge Commission through the creation of the Commercial Crew and Cargo
Project Office (C3PO). C3PO was tasked with “stimulating commercial enterprise
in space by asking American entrepreneurs to provide innovative, cost-effective
commercial cargo and crew transportation services to the [International] Space
Station” (Griffin, 2005, p. 179). To achieve this, C3PO established the Commercial
Orbital Transportation Services (COTS) Program under which it awarded contracts
known as ‘Space Act Agreements’ to spaceflight transportation companies to
develop vehicles, systems and operations of reliable, low-cost access to a low-Earth
orbit via spacecraft. Space Exploration Technologies Corp (SpaceX) was awarded a
Space Act Agreement to first demonstrate the safe disposal or return of spacecraft
24 A. K. E. Sherborne

that docked at the International Space Station to deliver cargo, and to later demon-
strate the same capability for manned spaceflights.4
The C3PO COTS program, as well as the later Commercial Crew Program
(CCP), have been regarded as successfully bringing new entrants into the market
and reducing the costs associated with space exploration (Zapata, 2017). This was
achieved in part by adopting new models of public-private contracting, whereby
contracting terms were outcome based rather than process based. Previously, NASA
devised requirements for crew transportation systems that carried astronauts into
orbit, with NASA supervising every aspect of its design and development. NASA
would enter into contractual arrangements with an aerospace company to build the
crew transportation system to the particular design criteria and standards required
by NASA. NASA would also be heavily involved in processing, testing, launching
and operating the final system. Under the COTS and CCP models, aerospace com-
panies are encouraged to use their own development and production techniques to
design and deliver the transportation system in the best way they see fit, so long as
the final system is fit for purpose. For example, in SpaceX contracts “SpaceX
designs, manufactures, and operates the crew system to meet a fixed set of high-­
level NASA requirements” which encourages SpaceX to “execute against them with
creative, innovative, and cost-effective solutions” and results in “notable safety
improvements, significant taxpayer savings, and more rapid development time-
frames as compared to traditional cost-plus contracts” (Koenigsmann, 2018,
pp. 1–2 and 4).
This has facilitated an environment in which SpaceX may design and develop the
Falcon 9 rocket via its own procedures and at substantially lower cost. NASA esti-
mated that Falcon 9 v1.0 development costs were approximately USD390 million
(Zapata, 2017) whereas NASA evaluated that such costs would have been USD3.977
billion if a traditional cost-plus contract approach had been used (Zapata, 2017;
NASA, 2011; SpaceX, 2011). Estimates have placed the entirety of the SpaceX
Dragon program cost to NASA at USD1.7 billion, with NASA investing a total of
USD6.2 billion in the CCP since its inception, making it the lowest-cost human
spaceflight development effort in close to 60 years (Dreier, 2020). Although the
United States has led the development of a commercial space economy, fostering
private sector involvement and investment at the domestic level has also been a
priority for a number of other governments in recent years, including Australia,
Canada, China, France, Germany, Italy, Mexico, the Netherlands, New Zealand,
Norway, South Korea, Switzerland, the United Kingdom and the US (OECD, 2019).

4
SpaceX successfully completed the first demonstration in 2012, and the second demonstration in
2020. SpaceX has also provided critical resupply services under a separate ‘Commercial Resupply
Services’ contract with NASA.
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 25

2.2.2  he Space Economy and Space Sub-sectors: The Trend


T
Towards Increased Commercialisation

Historically, space has been dominated by government activity in a small number


of space-faring nations. But today, the global space economy is increasingly becom-
ing a dynamic ecosystem of public and private organisations and investors and com-
prising a number of specific space sub-sectors (OECD, 2012, 2019). It is broad in
scope, encompassing not only the traditional activities of the space industry, such as
launches and the production of specialised spacecraft, but also the diverse uses of
technologies and applications derived from space. Recognising the breadth of the
modern space sector, the Organisation of Economic Cooperation and Development
(OECD) developed a far-reaching definition of the space economy, defining it as:
[the] full range of activities and the use of resources that create and provide value and ben-
efits to human beings in the course of exploring, understanding, managing and utilising
space. Hence, it includes all public and private actors involved in developing, providing and
using space-related products and services, ranging from research and development, the
manufacture and use of space infrastructure (ground stations, launch vehicles and satellites)
to space-enabled applications (navigation equipment, satellite phones, meteorological ser-
vices, etc.) and the scientific knowledge generated by such activities. It follows that the
space economy goes well beyond the space sector itself, since it also comprises the increas-
ingly pervasive and continually changing impacts (both quantitative and qualitative) of
space-derived products, services and knowledge on economy and society (OECD,
2012, p. 20).

The OECD definition recognises the breadth of space technologies and their
functions, noting that space derived products may be delivered and consumed as
both goods and services, and which are becoming increasingly essential to modern
consumers (OECD, 2012). As such, the opportunities and benefits derived by users
of space technologies can no longer be said to be exclusive to traditional space par-
ticipants. A notable example is the range of activities involved with sending satel-
lites into low-Earth orbit (LEO) which nowadays may generate considerable
financial returns, as individuals, SMEs and large organisations use satellite derived
data for business purposes (Mitchell, 2018; Valnia et al., 2019).
The privatisation of space, and the displacement of incumbent space users, has
seen the space sector grow rapidly over the past decade (von der Dunk, 2018). In
2019, the value of space related goods and services was valued at USD366 billion
(SIA, 2020) with economic models forecasting continued growth to above USD1
trillion by 2040 (Morgan Stanley Research, 2020). A number of factors have con-
tributed to this growth. Firstly, commercial competition has been facilitated by
increased government and private sector investment and encouraged by new and
shifting market structures. In particular, the diversification of commercial uses and
applications of space and space derived data has increased the size of the space
economy by expanding various sub-sectors of the space sector. This has allowed
more market participants to be involved in the space economy. As a consequence of
this increased competition between private companies, firms have had to be innova-
tive in order to find cost and production efficiencies to remain competitive (Solomon,
26 A. K. E. Sherborne

2008). For example, commercial launches have reduced the cost of LEO by a factor
of 20 in the last decade (Deloitte Access Economics, 2019). Secondly, technological
advances, reduced costs, and increases in profitability have made investments in
space organisations more attractive and commercially viable. These changes have in
turn driven record private investment in space organisations and activities interna-
tionally, which has only spurred on further growth across all sub-sectors in the space
economy (Deloitte Access Economics, 2019). As private actors play a growing role
in the financing of the space economy, there has been a reduction in the relative
importance of government activity and spending (although there remains significant
investment by governments looking to foster their domestic space economies)
(Australian Government Department of Industry, Science, Energy and Resources,
2019). Thirdly, modern consumers have created a demand for data which is being
met by a rapidly increasing number of commercial space organisations manufactur-
ing more affordable satellites and creating new space-derived applications.

2.2.3 Space Sub-sectors

As space becomes increasingly commercialised, a number of sub-sectors within the


broader space economy have emerged. Four key sub-sectors now play an important
role in the continued process of commercialisation of space.

2.2.3.1 Space Manufacturing

The space manufacturing sub-sector includes the design and manufacture of space
infrastructure and equipment such as spacecraft, satellites and payloads (space seg-
ment manufacturing), as well as the subsystems that are required for the primary
functions of the space sector such as satellite control facilities (ground segment
manufacturing). Key elements of the space manufacturing sub-sector include:
• launch vehicles and relevant subsystems;
• satellites, spacecraft payloads and relevant subsystems;
• ground segment systems and equipment;
• suppliers of key materials, hardware and base components;
• technical scientific and engineering support; and
• fundamental and applied research to design and manufacture.
Space manufacturing companies are typically large multinationals with the capa-
bility to produce complete aircraft and rocketry systems, as well as the required
integration systems for space and ground infrastructure. The market players in this
sub-sector tend to have long-standing experience in the aerospace and defence sec-
tors and include companies such as Boeing, Airbus, Lockheed Martin and Northrup
Grumman. However, as described above, the nature of the space industry and
broader space economy has shifted over time with new players emerging. Newer
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 27

participants in the space manufacturing sub-sector include Rocket Lab, Blue Origin,
SpaceX and Virgin Galactic. Further growth of this sub-sector is anticipated, given
projections of demand coming from commercial sources as well as traditional insti-
tutional consumers.

2.2.3.2 Space Operations

The space operations sub-sector includes the administration, management and


logistical arrangements involved in using space infrastructure. Space operations is
considered the facilitative component of the space supply chain as space operations
companies manage the operational and logistical requirements of space systems.
These space systems typically consist of one or more ground stations and a space
station, which transmit and receive data and information to and from ground sta-
tions and space stations using radio communications. Key elements of the space
operations sub-sector include:
• launch services (including launch brokerage and facilitation services);
• satellite operation (including the sale or lease of satellite capacity);
• third-party ground segment operation;
• developing and operating ground station networks;
• remote operation of space activities; and
• monitoring space debris.
Companies participating in the space operations sub-sector have typically held
significant space assets (generally satellites and related technology) and work with
both commercial and government users. Companies in this space sub-sector include
Lockheed Martin, Boeing, Bigelow Space Operations, KBR, and Atlas Space
Operations.

2.2.3.3 Space Applications

The space applications sub-sector involves the use of space-derived data, informa-
tion and other resources to create new products and services. Demand for space-­
enabled services and space-derived applications is driven by industries across the
economy, as organisations become increasingly supported by satellite services. Key
elements of the space applications sub-sector include:
• direct-to-home (DTH) broadcasting;
• fixed and mobile satellite communications services;
• managed network services;
• location-based signal and connectivity service providers;
• supply of user devices and equipment;
• Earth observation services applications;
28 A. K. E. Sherborne

• satellite communications services, navigation and mapping services, and pro-


cessing of satellite data services; and
• use of applications relying on embedded satellite signals (including GPS devices
and location-based services) and data (e.g. meteorology, commercial GIS soft-
ware and geospatial products)

2.2.3.4 Secondary Space Services

Secondary space services involve the provision of specialised professional services


to support space activities undertaken across primary space sub-sectors. Key ele-
ments of the secondary space services sub-sector include:
• launch and satellite insurance services;
• financial services;
• legal services;
• ICT services;
• market research and consultancy services;
• business development;
• construction; and
• research and development.
The secondary space services sub-sector is still in its early growth phase, given
demand for such services is dependent on demand from primary sub-sectors.
However, given the growth of these primary sub-sectors, secondary actors (such as
banks, insurance agencies and law firms) are increasingly broadening the scope of
their services to accommodate business needs within the primary sub-sectors.

2.3 The Space Economy in Australia

Although Australia has a relatively long history of participation in global space


activities, the commercialisation of space and the development of a distinctly
Australian space economy is a more recent development (Lisk & de Zwart, 2019).
However, recent growth has been substantial, with increases to the space economy
outperforming the pace of growth in the broader domestic economy (KPMG, 2020).
The value of the Australian space economy was estimated at AUD3–4 billion in
2016 (ACIL Allen Consulting, 2017, p. i), and more recently at AUD5 billion in
2020 (KPMG, 2020).
There is also significant potential within the Australian space economy for fur-
ther economic growth. Factors such as Australia’s advanced research capability,
technical expertise, unique and strategic geographic location and long-standing
cooperative partnerships with other space-faring nations (notably the United States
and the United Kingdom) are capable of being leveraged by the Australian space
economy to commercialise space activities (ACIL Allen Consulting, 2017, p. ii;
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 29

OECD, 2019). This process is underway, with a number of new players having
entered the Australian space economy including Gilmour Space Technology, Saber
Astronautics, Neumann Space, Fleet Space and Myriota. More firms are projected
to enter the market and the Australian space sector is expected to grow at an annu-
alised 7.1% through to 2023–24 (IBIS World, 2018, p. 7). The Australian Government
has indicated it intends to continue to encourage private actors undertaking com-
mercial space activities in Australia and has projected the space economy will be
valued at AUD12 billion by 2030 (Australian Government Department of Industry,
Science, Energy and Resources, 2019).
From a regulatory perspective, the Australian government has understood for
some time the need to have strong legislative frameworks to govern and foster a
domestic space industry. In 1998, the Australian Government passed the Space
Activities Act 1998 to regulate what was considered at the time to be a major oppor-
tunity for the development of a domestic launch services industry (Jones & Macken,
2019). From this date, Australian entities and the Australian Government continued
to be active in a number of space-related activities which has seen a gradual yet
substantive increase in the market size of various Australian space sub-sectors. On
13 July 2017, the Australian government announced a review of Australia’s space
industry capability to establish and ensure a “strategic framework is in place to sup-
port the growth of Australian’s space” (Australian Government Department of
Industry, Science, Energy and Resources, 2017). Following the review, the
Australian Government’s 2018–19 federal budget formally announced the estab-
lishment of the Australian Space Agency, with initial funding starting at $26 million
over 4 years and with an additional $15 million from 2019–20 to invest in specific
international space projects considered beneficial to Australia (de Zwart, 2019;
Australian Government Department of Industry, Science, Energy and
Resources, 2018).

2.4 The Space Economy in New Zealand

New Zealand is a “new and dynamic actor in the space sector with a focus on ‘new
space’” (OECD, 2019) and provides an illustrative example of the space industry
being driven primarily by commercial activity rather than large-scale government
activity as is the case in traditional space economies. A 2019 report from Deloitte
Access Economics commissioned by the New Zealand Ministry of Business
Innovation and Employment (MIBE) characterised the domestic space sector as one
involving a “mix of start-up and well established, small and large, entrepreneur-­
driven and privately-funded space companies which service both government and
non-government customers” (Deloitte Access Economics, 2019, p. 5) valued at
NZD1.69 billion in 2018–19 and supporting 12,000 jobs. Global trends have also
influenced the development of New Zealand’s space sector, with increased competi-
tion between private companies creating cost efficiencies and innovation, increased
private investment funding technological advancements and novel business models,
30 A. K. E. Sherborne

and increased consumer demand for data and space-derived applications facilitating
the shift towards the commercialisation of space activities.
The space industry in New Zealand is notable in particular for its strong, market-­
driven space operations sector that has emerged in recent years. Rocket Lab, a US
company with a New Zealand subsidiary, established the world’s first private orbital
launch range located on the Mahia Peninsula on the east coast of New Zealand’s
North Island.5 Within the global space context, Rocket Lab accounts for NZD454
million in private investments for the space economy (Deloitte Access Economics,
2019). New Zealand also has a number of established and new commercial space
actors operating within the space applications sub-sector and has substantial spe-
cialist research and development capability which provides a foundation for further
space sector development (OECD, 2019).
The New Zealand government has also taken steps to facilitate the development
of the domestic space economy. The New Zealand Space Agency was established in
2016 and creates and oversees space policy and supports space sector development.
New Zealand’s space budget for 2018–19 was NZD $3.8 million and the MBIE
spent a further $6.02 million in 2018–19 to fund research into space science and
technology (OECD, 2019).

2.5  ommercial Space Activities and the Legal


C
Risk Environment

Whether for an established company or a start-up, identifying and managing risk is


a major part of any business enterprise. This holds true in the context of the space
industry where both new and incumbent commercial space actors will invariably
face a variety of technical, regulatory, legal, operational and financial obstacles
before they can successfully carry out space activities as part of their business enter-
prise. In this context there is the added complexity of an international legal regime
applied at the nation state level, as well as the inherently high-risk nature of space
activities (Cheng, 1997; Diederiks-Verschoor & Kopal, 2008; See, 2017). In this
respect, analogies can be drawn between outer space with other domains, such as
the high seas and Antarctica, where a combination of international treaties, national
laws governing certain objects and activities of citizens and private contractual
frameworks create unique legal environments (Nicholson, 2002).
This part in particular focuses on the regulatory and legal considerations both
established players and new entrants to the space economy ought to be cognisant of
and take into account before commercialising space activities. Importantly, the
nature and magnitude of these risks will differ depending on the type of space activ-
ities being undertaken. For example, the risks involved in the operation and launch
of a spacecraft from Australia will involve different regulatory and legal risks as

5
As of December 2020, Rocket Labs had launched 55 satellites into low Earth orbit.
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 31

compared to an agri-tech company using satellite-derived data to provide advisory


services to farmers. This part provides a general and holistic overview of the legal
and regulatory obstacles for participants primarily involved in the primary space
sub-sectors.

2.5.1 Regulatory Risk

All corporate entities carrying out business need to be aware of the regulatory
regime in which they operate. This is especially true for commercial space actors
where a regulatory framework for space activities can be found both at the interna-
tional law level through a number of international treaties, bilateral arrangements,
and customary law, as well as at the national level where respective governments
have introduced legislative frameworks to regulate domestic space activities
(Diederiks-Verschoor & Kopal, 2008; Von der Dunk & Tronchetti, 2015). As such,
it is crucial that both new and existing players in the space economy have a robust
understanding of what regulatory risks they are likely to face when carrying out
commercialised space activities so as to mitigate those regulatory risks.
Five major international treaties have established the basic principles of interna-
tional law as it relates to the exploration and use of space by nation states.6
Collectively, and in particular the Treaty on Principles Governing the Activities of
States in the Exploration and Use of Outer Space, including the Moon and Other
Celestial Bodies (the Outer Space Treaty) as supplemented by the Convention on
International Liability for Damage Caused by Space Objects (the Liability
Convention), these multilateral conventions require States to comply with principles
of international law, to assume responsibility and liability for its national activities
undertaken in space, to authorise and supervise the activities of the state’s citizens
in space, and to notify the United Nations, the public, and the scientific community
of their activities in space (Outer Space Treaty, Art III, VI, VIII, XI; Liability
Convention, Art I, II). Importantly, the responsibility for space activities is not lim-
ited to those activities carried out, overseen, or supported by the government itself,
but extends to those space activities of independent private actors operating within
the sovereign state’s jurisdiction. This includes both natural persons and corporate
entities. As states are accountable for any breaches of international law and are lia-
ble for national space activities, states may be obliged to pay compensation for any

6
The Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer
Space, including the Moon and Other Celestial Bodies, opened for signature Jan. 27, 1967; The
Agreement on the Rescue of Astronauts, the Return of Astronauts and the Return of Objects
Launched into Outer Space, opened for signature Apr. 22, 1968; The Convention on International
Liability for Damage Caused by Space Objects, opened for signature Mar. 29, 1972; The
Convention on Registration of Objects Launched into Outer Space, opened for signature Jan. 14,
1975; and The Agreement Governing the Activities of States on the Moon and Other Celestial
Bodies, opened for signature Dec. 18, 1979.
32 A. K. E. Sherborne

compensable damage for which they are liable. This includes where such damage
was incurred in connection with the activities of a non-government space actor.
For this reason, the United Nations General Assembly (UNGA) has encouraged
States to “consider enacting and implementing national laws authorizing and pro-
viding for continuing supervision of the activities in outer space of non-­governmental
entities under their jurisdiction” (UNGA, 2004, p. 2). Similarly, the United Nations
Committee on the Peaceful Use of Outer Space (UNCOPUOS) has provided that:
“[space] activities should require authorization by a competent national authority; the
authorities and procedures, as well as the conditions for granting, modifying, suspending
and revoking the authorization should be set out clearly to establish a predictable and reli-
able regulatory framework… The conditions for authorization should be consistent with the
international obligations and commitments of States, in particular under the United Nations
treaties on outer space…” (UNCOPUOS, 2012, p. 40).

In any case, given the ultimate responsibility and liability of the state in interna-
tional law, national governments are incentivised to regulate the domestic space
activities to mitigate the risks involved in non-compliance with international law,
and to protect the welfare of citizens, property, and environment. Furthermore, as an
increase in private space activities increases the international liability risk for the
nation state, states are further incentivised where commercial space actors are grow-
ing in number and becoming increasingly involved in space activities (Dempsey,
2016). However, nation states are also generally reluctant to create barriers to entry
and stifle innovation and industry within their domestic space economies, given the
economic benefits of an active commercial space sector and the importance of
encouraging economic activity in domestic space related enterprises (Dempsey,
2016). Consequently, in developing legislative regimes for space activities, nation
states have generally had to find a balance between minimising their legal exposure
at the international level and commitment to ensuring the welfare of its citizens with
the economic opportunities involved in promoting and facilitating domestic space
activities.
As at the time of publication, the United Nations Office for Outer Space Affairs
(UNOOSA), which collates the laws and regulations of nation states that relate to
the exploration and use of outer space, reported that 25 countries had enacted
national space legislation.7 These domestic legal regimes and associated regulations
which deal with the rights and responsibilities of commercial space actors supple-
ment the international legal framework, and as such, must be carefully considered
by commercial space actors to ensure their initial and ongoing compliance. This is
crucial, given that a failure to meet legislative and regulatory requirements may
render a commercial space actor liable for significant financial penalties.
The particular requirements of the domestic space legislation and regulation vary
across jurisdictions, but generally involves establishing parameters around how

7
These nation states are: Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, China,
Denmark, Finland, France, Germany, Japan, Kazakhstan, the Netherlands, Norway, Philippines,
Republic of Korea, the Russian Federation, South Africa, Spain, Sweden, Ukraine, the United
Kingdom, and the United States of America.
2 The Commercialisation of Space: An Overview of Legal Risks and Considerations 33

space activities are undertaken with a two-fold objective of minimising the risks
inherent in such activities so as to mitigate liability at the international level while
also avoiding stifling innovation and industry in the domestic space economy.
Common features of domestic space legislative regimes which aim to achieve this
objective include the establishment of a licensing and approvals framework, the
requirement for insurance to offset potential losses, the inclusion of space debris
mitigation measures (or related environmental protections), and supervisory mea-
sures to ensure appropriate oversight of domestic space activities. These are consid-
ered generally in turn, with a focus on the particular regulatory requirements in
Australia and New Zealand.

2.5.1.1  pprovals, Authorisations, Permits and Licences


A
for Space Activities

Depending on the jurisdiction, the legislative regime may include imposing require-
ments on non-government space actors to obtain the necessary government approval
before carrying out space activities.8 For example, in Australia the following space
activities require approvals under the Space (Launches and Returns) Act 2018
(SLR Act):
• establishing and operating a launch facility in Australia;
• launching a space object from a launch facility in Australia, an Australian air-
craft, or an overseas aircraft in Australian airspace;
• launching a high-powered rocket in Australia;
• returning a space object to Australia;
• launching a space object overseas (for Australian nationals with an ownership
interest); and
• returning a space object overseas (for Australian nationals with an ownership
interest); (SLR Act, Part 3, Divisions 2-6A).
In New Zealand, the following space activities require approvals under the Outer
Space and High-altitude Activities Act 2017 (OSHA Act):
• launching a launch vehicle from New Zealand;
• launching payloads from New Zealand;
• launching a launch vehicle from overseas;
• launching payloads from overseas;
• operating a launch facility in New Zealand; and
• launching a vehicle that does not reach outer space but is considered a high-­
altitude vehicle (OSHA Act, Part 2, Sub-parts 1–6).

8
The terminology for such approvals varies across jurisdictions, but are generally referred to as
“approvals”, “licences”, “permits” or “authorisations”.
Another random document with
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lunch? Another tenpenneth of tea and the biscuits I carry will do for my
breakfast. So only dinner need count. Really the cost of going all that
distance is absurdly small when one thinks of it. And then the saving of
night travel, besides the comfort of having a proper bed without the trouble
of going to it."

"Still, you pay pretty high for the comfort."

"Only the usual first-class fare. There it is, written down plainly; just
read the advertisement, Herbert: 'Monte Carlo and Sunshine—as easy as
going to Brighton. The train, with special new bogie corridor carriages'—I
shan't like the bogie part, though—'leaves Victoria at 11 a.m.' H'm, h'm
—'you land at Calais in less than an hour'—just fancy!—h'm—'no
scrambling for meals or seats, your places have been reserved, and you
walk in as you would to your stall at a theatre.'"

"Matinée Hats and all?" interjected Arthur with brutal levity, haughtily
ignored but not unnoted.

"'Separate staterooms'—now I shall know what a stateroom is like


—'artistically furnished and decorated, warmed, lighted by electricity, and
each provided with a dressing-room with hot and cold water.' Now, Herbert,
isn't it wonderful? And besides all that, just listen: 'Perfect meals are served,
and the sleeping accommodation is magnificent.' Now, I should be quite
content with the artistic stateroom and the separate dressing-room, shouldn't
you? H'm—h'm—h'm. 'And you arrive, not fatigued, but refreshed, at Nice
at 10.32 a.m., so that'—h'm—h'm—h'm—'you may be taking your
déjeuner'—h'm—h'm—'bathed in sunlight,' etc., 'in about twenty-four hours
after leaving the fogs of London.' Bathed in sunlight," she sighed with
luxurious rapture.

"Why have we never done this thing before?" asked Herbert. "Far from
being expensive, the journey appears positively to enrich you. Still, I advise
you to take some soap and a towel, and a few odd louis and a handful of
francs. But, my poor child, observe this little item, 'Supplemental charges'
for the sleeping-cars."
"What? Five pounds practically! Then I'll just not have a sleeping-car at
all, but tuck myself up in the artistically furnished, warmed, and lighted
stateroom for the night."

"Alas! I regret to say that the staterooms and sleeping-rooms are one
and indivisible."

"Then," said Ermengarde, with deep and indignant conviction, "it's a


shame and a swindle. And I'll go by a Rapide, and make myself up in a
corner with cushions. Providing I face the engine and have a corner seat, I
can always sleep in a train."

A cumulative family veto promptly negatived this mad resolve, and


Ermengarde's sum total for the single journey leapt up accordingly, till,
what with booking fees, registrations, insurances, tips, and those
supplemental charges that bristle all over Continental time-tables, it doubled
her original estimate, and she began to think that, if hotel expenses bounded
up in the same proportion, it might be the more prudent course to stay at
home.

But the very word home came with a shock that showed the
impossibility of that course. She must forget certain things, and grow
accustomed to certain daily deepening pangs, and steep her thoughts in
other atmospheres, and so take breath and strength for the newer, darker
aspects of life confronting her. Especially she must forget the experience of
a certain dark and dreadful night. On that occasion she had dined at her
father's house, and growing weary of the musical evening that followed, and
eschewing the delights of bridge in a dim and distant room clandestinely
devoted to that pastime, had cabbed quietly home at eleven and let herself
in with a latchkey.

The house was silent; the servants evidently had gone to bed; a candle
and matches under a still burning gas-bracket awaited her; but the light
under the study door showed that the master of the house had come home,
presumably to the heavy evening's work that had been his excuse for not
dining at Onslow Gardens. Thinking to just let him know she was in,
without interrupting his work, she stepped softly to the study, and as softly
opened the door and looked in.
The room was partly in shadow, lighted by fire-gleams. Over the
writing-table was a shaded lamp, in the interrupted light of which she saw
the slender, bowed figure of a woman sitting, with her face hidden by her
hands. Beside her, and bending slightly over her, stood Arthur, his face in
shadow, his hand on her shoulder, which quivered with restrained sobs; he
was speaking in a low, earnest voice words inaudible at the door at the other
end of the room.

For a moment Ermengarde stood at gaze, transfixed, a curious


strangling sensation in her throat, and a feeling like hot wires burning her
eyes. Then, very softly, almost unconsciously, she closed the door, and,
after a moment's pause, turned, carefully gathering up her skirts from their
silken rustle on the floor, and went to the table, whence she took the
unlighted candle, and walked upstairs with a slow, tired step and a strange
proud quiver of lips.

Presently she heard the street door opened, the shrilling of a cab-whistle
and answering trot of a horse, some murmured voices, followed by hoof-
beats dying away, and the sound of shutting the door, bolts driven, and
chain put up. Half an hour later the study door, opening, let out the scent of
a cigar, and Arthur came up.

"You came home early?" he asked indifferently, and she said "Yes,"
trying to force herself to make some matter-of-fact allusion to the friend in
the study, but not succeeding till next day, when her easy observation,
"Were you alone when I came in last night?" produced the unembarrassed
reply, "No; a secretary was with me. I had rather a heavy night."

"So had I," she thought with growing bitterness.

But afterwards she stooped to a thing that lowered her in her own sight,
while something stronger than herself drove her to do it.

"By the way, I thought I heard voices in the study when I came home
last night," she said carelessly to the parlourmaid. "Did anyone call while I
was out?"
"No, ma'am," with some hesitation. "At least—only the—the young
lady."

"The young lady, Rushton? What young lady?" sharply.

"Please, m'm, the young lady that comes for master. I never can
remember her name. She came last time you went to Onslow Gardens, and
when you were ill—and——"

"Of course, Rushton, of course—" she interrupted, the blood throbbing


in her temples and a mist coming before her eyes. "How stupid I am! I had
quite forgotten. Yes—yes. Be sure you remember about the table-centre to-
night. And sweet geranium leaves in the finger-bowls. Yes—yes."

That was the tragic note jarring all the music of life; it was that she
wished to forget. There was no doubt of the meaning of that scene; it could
be nothing else, and whatever its meaning might have been, she could not
stoop to ask any solution. And being what she thought, there was no appeal,
no help; nothing for it but stoic endurance and averted eyes. Often she had
listened to the bitter, godless creed that no man is without reproach, none
proof against one form of temptation; that women can only wait and look
away till that trouble is over-past; and insensibly the dogma had sunk into
her mind, neither welcomed nor repelled, only put out of sight in the
brightness and gaiety of a safe and sunny life.

But would she so readily have grasped the situation except for those
hats? and would he have sneered at those unlucky pieces of costume had his
heart been where it should be?

Not that Ermengarde admitted this to herself. "O for the wings of a
dove!" she cried in her heart, and explained to herself that the Influenza
demon had weakened and depressed her, that the beginning of Charlie's first
term at school had made the house a desert solitude, and that she had come
to realize the melancholy fact that her married life had reached the
inevitable stage of monotonous indifference and mutual irritation, of which
no poet sings, but ordinary mortals discourse in very plain, unvarnished
prose. Once she had accustomed herself to it, no doubt she would be able to
put up with it, as other women did. So far had she travelled from the
petulant security of the days before the arraignment of the five rejected hats.

It must have been Herbert who made the unlucky suggestion that the
train-booking should be done through Cook, and the services of his
interpreters secured. To this Ermengarde readily agreed, though her French
was above the British average. "I'll write to-night," she said.

Then it was that Arthur observed that it might be well before buying
tickets to decide where she was going. That horrid sarcastic style of his was
so immeasurably irritating.

"Since you wish to know," she replied haughtily, "my destination is


Nice."

And when asked why, unready with an answer, having settled on the
spur of the moment upon the first name that came up, she said lamely, "It's
—it's the centre of everything."

"But why choose the coldest and dustiest place on the Riviera?" her
mother asked over the afternoon teacups.

"And the resort of the rowdiest lot of visitors and haunt of native and
foreign sharpers," added a woman, who had just appeared, full of the
grievance of being packed and ready and at the last moment denied a ticket
till after the next ten days, every place till then being booked ahead.
"Besides, if you want quiet and scenery, you hardly go to a big town."

Somebody else suggested that what had been good enough for Queen
Victoria was good enough for her, and painted the beauties of Cimiez in
glowing colours. "And think of the Opera and the Theatre at Nice. And the
Battle of Flowers and the Carnival. To see those properly you must go to
Nice."

Then Ermengarde decided on Hyères, for scenery, good air, and


romantic associations; and, having penned her letter to Cook, heard from
one whose pilgrimage had been to that shrine, that there was absolutely
nothing to do at Hyères and no society whatever, and that the climate and
also that of Costebelle was positively murderous. Why not try San Remo or
Alassio? or Pegli, with the advantage of being practically at Genoa? Each of
these being in turn decided on, some dreadful defect in each was in turn
discovered. Everybody Ermengarde knew had been everywhere and knew
everything about it, and as each had entirely different views of every place,
it was a little bewildering to an unbiased mind.

Bordighera was at last chosen, as being a place of palms, and associated


with Ruffini's charming story, Dr. Antonio. Then it turned out that
Bordighera was the windiest spot in Europe, and absolutely without shelter,
and that the palms, being tied up like lettuces for the market, were an
abomination of desolation; besides, crossing the frontier involved another
custom-house worry, and the loss of an hour at Ventimiglia.

So at last Mentone, chosen more than once from rapturous reports of


friends and the charm of Bennett's description in his Mediterranean book,
and more than once abandoned on account of dismal tales of bad sanitation,
heat, damp, and relaxing air, was finally decided upon—a stern and
unanimous family veto having been pronounced against both Monte Carlo
and Monaco—and a seat booked ten days in advance.

"A seat," Ermengarde observed with a deep sigh of content; "rather an


exquisite boudoir"—"'Artistically furnished and decorated,'" her husband
muttered—"with a most luxurious sofa, little tables, and every comfort, and
'through the window a moving panorama of lovely, sunlit scenery.' How
restful! With books, papers, letters to write, when the outlook palls. All the
comfort of a private room in a first-class hotel, with no stairs and constant
change of scene. I could travel for weeks in such circumstances. The only
trouble is the fellow-traveller. How nice it would be to be able to take two
places!"

Female friends urged the necessity of summer frocks and shady hats;
Arthur was strong upon furs and wraps. Monte Carlo would involve great
splendour of evening toilette, and summer hues and textures by day. Tailor-
mades by artists of renown would be chic, but only of superfine faced-cloth,
so Herbert said, quoting with the pride of recent knowledge from the
Queen, while as to hats—
"Don't speak of them. My wife is like Mr. Toots, who, you remember,
was fond of waistcoats," interposed Arthur; "she has a weakness for hats."

"Out of compassion to you, to give you something to sneer at," she


flashed out, bit her lips, and turned the subject, while Arthur, dumbfounded,
and cudgelling his brains to discover the rock of his offence, remembered
the five discarded hats, and fumed with annoyance.

Victoria at eleven in the morning, when some ruddy gold sunbeams


were struggling through clinging folds of mist, presented a lively spectacle,
something between an Ascot day and a cheap excursion. Shepherded by
men in and out of livery and lady's-maids engaging in fierce combat with
porters and guards, fur-clad dames of high and low degree, decked with
flowers, and with fur-coated squires to match them, sailed majestically in
the path of advancing towers of luggage, and impeded progress in every
direction by standing in picturesque groups at the doors of carriages, or
exactly in front of moving crowds, to exchange inane smiles, minute bows
and meaningless small talk, impervious to the hoarse shouts of hot and
panting porters, stonily unconscious of civil requests from fellow-travellers
looking for hat-boxes, friends, trunks, mistresses, hand-baggage, servants,
and such oddments, in the hurrying melée among toppling towers of trunks.

"Half London and the whole of the suburbs seem to be going by the
twelve-fifty boat," Ermengarde said, unmoved by all this hurry and
confusion in the happy security of a corner seat facing the engine, and
booked by Cook. She was glad that Arthur was unable to see her off, he
having had an unexpected business call to one of the South Coast summer
resorts, she had forgotten which, the day before, so that only Herbert, her
mother, and some half-dozen intimate friends, were saying good-bye and
preventing her from looking after her luggage.

"Look here, there's some mistake about this ticket," cried Herbert
presently, emerging from an arduous and prolonged struggle all down the
long train and back again. "No seat is booked for you in this train, but at last
I've found an empty corner, if you come quick before it's snapped up."

Ermengarde, speechless with amazement and indignation, and clinging


to Herbert's hand, somehow threaded the mazes of the crowd that surged
among laden trunks, staggering porters, hurrying servants with hand-
baggage, imperious conductors and omnipotent guards, all talking and
giving orders at once, while bells rang and whistles shrilled. She observed,
as she struggled through in her brother-in-law's wake, that every seat was
ticketed, and by this time most were occupied, if not by travellers, by their
hand-baggage, and at last found herself in a corner facing the engine, but
without any hand-baggage, hers having been variously confided piece-meal
to porters and friends.

She began to picture the possibilities of twenty-four hours of empty-


handed travel with some sinking of heart, while Herbert bestowed silver
and injunctions for her comfort on the conductor, and five heavy trucks
bearing trunks like Noah's Arks, each inscribed in large letters "The Lady
Emily Appleton," and accompanied by cockaded men, wedged their way
past her door, and were followed at uncertain intervals by her mother,
panting and anxious, with a lunch package, and her half-dozen friends, each
with the same number of papers, periodicals, baskets of fruit and bouquets,
and, finally, after prolonged skirmishing, a porter with a hold-all and a
dressing-bag. Herbert had vanished to get a ticket for himself and
accompany her to Dover, much moved by the forlorn and bewildered
expression on poor untravelled Ermengarde's face, when she looked from
her window (the door being hopelessly blocked by fellow-travellers and
their followings of friends); and occasionally darted forward to catch a
paper or a flower from a friend's hand outstretched over the heads of the
crowd blocking the door; or tried to hear some shouted assurance that her
ticket was at least all right for the Calais train, that the sea was like glass,
and the sun coming out. Her seat not being reserved, she dared not leave it
to say the innumerable last words that rise to the lips of lady householders
at such moments, and could only make signs to an anxious and much
hustled mother in the far distance, who responded without in the least
knowing what it was all about.

The tumult was subsiding, travellers were being respectfully but firmly
recommended to take places, and Ermengarde was about to make one last
wild effort to say good-bye to her mother, when a distracted female wedged
herself up to the carriage, gold-handled eyeglass in hand, and anxiously
sought for her name and number, which the conductor found for her above
the seat in the corner opposite Ermengarde's, to the lady's great indignation
and despair. She had expressly written "to face the engine," she cried. But
this was abominable; she could not possibly travel backwards; she must
have a forward corner; the man might look at the ticket, and so forth and so
forth, with a much-burdened maid and a porter waiting behind her. The
conductor was sorry, he told Ermengarde, but there had been some mistake,
the other lady was unfortunately entitled to the corner, whence Ermengarde
was obliged to move, finding, luckily for her, a middle seat, but losing all
possibility of any but signalled farewells, and seeing Herbert no more at all.

The sunlight broadened, the fog thinned, as the long train left dear, dirty,
smoky London behind, and the squalor of endless suburb diminished, and
the smell of country air came through a chink of opened window. But
Ermengarde's heart sank, and she felt herself a lone, lorn female, utterly
incapable of confronting the unknown perils and discomforts of travel after
this bad beginning. She was pulling herself together with delicious dreams
of the artistic Train de Luxe, when the lady who had ejected her from her
corner, and who evidently regarded her with wrath and indignation as an
interloper and semi-swindler, suddenly shivered and commanded her maid,
sitting opposite, to shut the little saving chink in the window.

Ermengarde's doom was now sealed; she would be train-sick.

She counted the minutes to be gasped through till Dover, and nerved
herself to ask the least forbidding of the two laced and furred dames
dragoning the windows for a little air before things reached a fatal crisis.
But even at that dread moment the fascinating vision of the Train de Luxe,
with its sofa, and wide window at command, its flying landscape, little
tables, artistic furniture and decorations, warmth and electric lights, came
like balm to her troubled breast.

Chapter III
The Train de Luxe

The fear of train-sickness happily ended, Dover castle was seen


climbing and cresting its bold headland, with the Roman church and Pharos
traced against a pale blue sky in the tender wintry sunshine. Arthur had
taken her there from Folkestone one sunny autumn day soon after their
marriage; they had cycled over the downs, been bumped and rattled up the
Castle steeps and across drawbridges, in a rickety pony carriage
commanded by a very small and reckless boy, holding on at imminent risk
of their lives all the way there and back. She remembered the scent of the
thyme, the interest of the place, the pleasure of the day, and wanted to cry,
she had no notion what for. But life cannot be all honeymoon; remembering
happier things sometimes affects the eyes like that, and the Dover trip had
really been a success in its way. Coming back, they had bought prawns, and
prawns make a good hors d'œuvre after open-air exercise. That the
remembrance of prawns, even in sight and scent of the sea, and near the
hour of lunch, should blur the sight was, of course, absurd; but then they
had been such glorious prawns, so large, so fresh, so vividly scarlet. One of
them had fallen out of the paper bag into Arthur's pocket, leaving an occult
and pleasant suggestion of ancient fish there for days before its discovery.

It must have been this defect of vision that made Ermengarde miss
Herbert, who, she supposed, must surely have found a place at Victoria, if
only in the guard's van or the luggage van in the rear. For, strain her sight as
she would, when the endless moving line of blue-jerseyed sea-porters
passing the train had at last been brought to a stand-still, no vestige of her
brother-in-law was to be found on the platform, and, during the precious
moments wasted in vain search, every one of these amphibious porters
seemed to have been snapped up and laden with those enormous bags,
boxes, and rolls of rugs, that Continental travellers playfully call hand-
baggage.

It had become a question whether Ermengarde or her hand-baggage,


which she was quite incapable of shouldering personally, or both, should be
left behind, when, after wild appeals to various haughty and inaccessible
officials, an aged and morose blue jersey was at last raked out of some
recess, and with difficulty prevailed upon to hang himself with her various
properties. Then, surlily commanding her to follow him along a quarter of a
mile or so of sloppy, narrow planking, crowded with people hurrying in
every direction, to an invisible and improbable boat, he started off at
express speed, easily making a path for himself through the press by the
simple process of wedging his burdens into the softest parts of people's ribs
and shoulders.

Ermengarde, having no such weapons of offence and defence, not only


failed to make any such path for herself, but suffered sadly from the assaults
of other armed amphibious monsters; and when, after a long and severe
struggle, she arrived, bruised, panting and dishevelled, at a huge vessel that
she hoped was the right one, she found her own surly amphibian goaded to
savagery by waiting to such an extent that he was only with great difficulty
induced to carry his burdens to the upper deck, where a cloudless sky and a
windless sea promised a calm and exhilarating passage. But there the blue
jersey's remnant of humanity came to an end. Find her a seat or a deck-chair
he would not, for love or money or persuasion; but, hurling his burdens to
the floor, he demanded double the silver she placed in his hand, received it,
and bolted.

Serried phalanxes of deck-chairs already crowded the deck and filled


every desirable position; but all were either occupied by happy voyagers,
comfortably tucked up in rugs and motor veils and caps, or by wraps and
luggage, chiefly masculine. Vainly did the hapless Ermengarde implore the
boys and men constantly emerging from the bowels of the vessel, laden
with chairs and stools, to fetch one for her. Stony silence, or at best a
negative headshake, was all this lone, lorn female could extract from these
iron-hearted creatures. She was still very weak; she was also famished; her
little strength was exhausted by the preliminary journey; in dread of sea-
sickness, she dared not turn her back to the vessel's direction, knowing she
could neither walk up and down nor stand, as others did. She dared not
descend the companion-ladder after the motion once began, and had she
done so, knew herself to be incapable of carrying her rugs and small
necessities. Shivering and faint, she was about to subside ignominiously on
the planks, when she caught sight of a chair-carrier returning empty-handed
to the companion, and once more entreated a chair of him.
"Sorry, madam, nothing but camp-stools left," he said, and was
despairingly told to bring anything that could be sat upon, which he quickly
did—for a stipulated price. All this time an empty deck-chair had been on
one side of her, and another, occupied by an exceedingly well-tucked-up,
fur-collared and fur-rugged youth of athletic build, on the other. An elderly
man, standing talking to a grey-haired woman who lounged in another
deck-chair, was the lawful tenant of the empty chair; and when the boy at
last appeared with a rickety camp-stool, on to which Ermengarde was about
to sink from exhaustion in the standing-place she had with difficulty kept all
this time between the two men's chairs, the elderly man suddenly appeared
to become aware of her difficulties, and turned to her with a gruff, "Better
change your stool for my chair—don't suppose I shall want it—rather walk
up and down," and turned sullenly away.

Sinking gratefully upon the long chair, so restful in spite of its wooden
hardness, with the sun shining and the sea sparkling to the even movement
of the great turbine vessel as they caught the faint breeze of their motion,
Ermengarde would now have been happy, but for the fear of that dread
penalty the sea exacts from sensitive voyagers, and the impossibility in her
giddiness and weakness of opening the straps that held her rugs and shawls.
How exasperatingly, aggressively, comfortable people looked, chatting and
laughing in their cosy furs; some even shielded themselves from the mild
warmth of the wintry sun with parasols, though Ermengarde would have
welcomed the glare of a furnace, as she shivered in the sharp sea air.

But others were worse off than she. So much so that she was even
moved to offer her own hard-won chair to a pretty, slender French girl, pale
and tired-looking, who kept leaning against anything that came in her way
till she seemed to become chilled to the bone, when she would move a little
and come back to the best place she could find. Presently she leant against
an iron balk close to an inviting deck-lounge, which was occupied the
whole way across by a hard round hat, a man's fur coat, and some walking-
sticks and umbrellas. Ermengarde longed to send these properties flying—
especially the hat, which inspired her with peculiarly acute hatred—and lay
the pretty, tired French girl upon the comfortable lounge, if only till the
owner of the hard hat came to claim it, which he never did, till they went
ashore. Had she been certain of her ability to keep her feet, Ermengarde
would certainly have yielded her own chair to the girl, and annexed to her
own use that sequestrated by the owner of the detestable hat; it would have
been such a pleasure to kick and stamp on that hat and hear it boom like a
drum, and pop like a burst motor-tyre. But she was by no means certain of
her ability to do anything but shiver.

An eternity of shivers and qualms seemed to pass before the spires of


Calais appeared between gaps made in groups pacing the deck, an eternity
mitigated by the thought that every shiver brought one nearer to the
artistically decorated, electric warmed and lighted, flying boudoir, with its
voluptuous sofa, etc., in the rightly named Train de Luxe—the very sound
of which diffused an atmosphere of comfort and peace.

And now at last all fear of the dread penalty of the inexorable sea was at
an end, and Ermengarde rose to her feet in the proud consciousness of being
able to stand, and even walk, without sudden subsidences to the deck or into
the unwilling embraces of indignant fellow-voyagers. Helped by a sailor,
who unexpectedly appeared at her side as if from the clouds, and was easily
persuaded to carry her things, she got down to the level of the landing-
place, and enjoyed the first thrill of foreign parts at the sight of blue-
cloaked men in uniform, short and solid, with bristling moustache and
complacent strut. How good it is, the first sight of these dear, delightful
creatures, who never seem to have anything to do but enjoy dignified and
ornamental leisure for the benefit of admiring mankind! And how good,
Ermengarde thought, to see a gangway shot into a crowd of laughing,
gesticulating, blue-bloused porters—to see them hurl themselves upon the
gangway tumultuously, one over the other, in a solid mass, with shouts,
songs, and exclamations, and so board the vessel, leaping and laughing,
and, falling upon passenger after passenger, tear their precious misnamed
hand-baggage from them, strap it across their own shoulders, and, deaf to
all entreaties, fight their way back to the gangway, leap ashore, and fly from
sight.

She would have followed her own especial robber, but that he forbade
her with gay volubility, and bid her accompany the rest of the robbed and
find him again at the Custom-house.
"Numéro Quatre," he cried, tapping the brass plate on his cap, and
dancing off with the grin and gesture of a good-natured gnome.

Observing that all but a few sturdy and muscular men submitted to this
spoliation, and unhesitatingly obeyed the commands of the gnomes,
Ermengarde, feeling very lone and lorn, and suddenly forgetting for sheer
weariness the whole of the French language in a lump, gave herself up for
lost, and was borne passively in the tide of fellow-sufferers, who formed a
soft but shifting support, to the gangway, where the pleasing spectacle of a
nervous man dropping an open purse of gold into the sea just in front of her
in attempting to produce a ticket, showed that every depth has a lower deep,
and consoled her with the reflection that her own spare pence were safely
bestowed in various inaccessible portions of her attire.

But here she was at last, in the beau pays de France, within measurable
distance of the much-desired and artistically decorated sofa, etc., if stiff and
trembling limbs would but support her through the tourist's purgatory, the
Douane. Never again would she dread solitary travel; the sea trip in
retrospect grew to be absolutely delicious—if she had only known it at the
time—in the exaltation of having survived the awful ordeal of passing
through the chops of the Channel—not that she had noticed any chops—she
felt capable of penetrating to Central Africa. Actually penetrating only to
the centre of the Douane, which at first sight she supposed to be a large
stable or coach-house, our poor untravelled traveller sought the friendly
face of Numéro Quatre among the long lines of brass-plated gnomes, only
to find it, with its elfish grin and the whole of her travelling necessaries,
conspicuous by its absence.

It was then, after long and vain search and countless wild and polyglot
inquiries of unsympathizing foreigners, and endless courses up and down
and round the crowded, many-voiced Douane, that the hapless Ermengarde
began to ask herself why she had left the safe and comfortable precincts of
her native land, and braved cold and famine and the terrors of the deep,
only to become the prey of grinning brigands upon savage and inhospitable
shores. Poor little Charlie, unwilling victim of enforced football, but at least
happy in ignorance of his mother's fate! London was undoubtedly foggy;
but property there was comparatively safe. People there were at least not
compelled to part with the whole of their possessions at the bidding of
strange monsters. Nor were they obliged there to lose expensive Train de
Luxe by waiting for hours in places with nothing to sit upon for people who
never came.

Crowds of smiling gnomes, cheerfully hung with other people's


property, stood in rank, gaily responding to the cries of rapture with which
their respective victims singled them out; there were dramatic meetings
between robbers and robbed, joyous recognition of property and gnome,
ecstatic greetings on the part of despoiled tourists of Numéro Cinq, Numéro
Cent, Numéro everything but Quatre.

Agonized inquiries for Numéro Quatre of other brass-plated caps


elicited cheerful replies that he would be here soon; but he was small and
Ermengarde was not over tall; and as gnome after gnome was recaptured by
long-lost owners, and compelled to unload his spoil upon the long counter,
to be marked with mystic runes to a briefly muttered shibboleth in polyglot
accents, and the congested crowd thinned and melted, and time and strength
and the last remnants of hope in Ermengarde's breast with it, she felt herself
on the point of tears, and was just beginning to drag herself empty-handed
to the long-desired repose of that artistically decorated stateroom, when, at
the far end of the hall, the square and cheerful countenance of the missing
Numéro Quatre was at last discerned, and the whole of his sins and her
sufferings forgotten in an eye-blink.

As for the gnome, he unblushingly commanded his victim to quicken


her trembling steps on pain of losing the train, went through a quick
pantomime at the counter, and dashed off with his spoil at express speed,
followed at a respectful distance by his exhausted prey, whose fainting
spirits rose when at last she saw the long-hoped-for train, with its vases of
mimosa, rose, and sweet double stock in the restaurant car windows. Very
haughtily she handed her ticket to a magnificently gold-braided person at
his demand, expecting to be respectfully conducted to her place "as to a
theatre stall"; and sighed with deep content, feeling that the great all-
compensating moment of the journey had at last arrived.

But the great gold-braided one, muttering a number to the long-lost


Quatre, merely waved a hand towards a sort of steep companion-ladder, and
turned to resume a broken chat with a friend. The ladder surmounted, and
the gnome having plumped the baggage, sadly reduced in quantity and
possibly in quality, into the first compartment he came to and vanished with
silver in hand, Ermengarde found herself in a narrow slip of a compartment
with a wide and springy seat, a tiny, hinged slab under the outside window
and just room and no more for the disposal of moderate-sized female limbs
without positive discomfort or involuntary kicks against an oblique wooden
partition, narrowing to the doorway, varnished, and featureless, a large
spittoon filled with water, a fellow traveller with mountains of hand-
baggage, and nothing more. The private dressing-room, the airy space, the
little hinged seats, "should the passenger wish to change position," etc.,
where were these?

Our pilgrimage through this vale of tears is mile-stoned by lost


illusions, Ermengarde reflected, subsiding with a deep sigh in the best
corner of the seat, which her fellow pilgrim had considerately left for her,
and feeling too glad to sit upon anything after the long skirmish through the
Douane to be over-critical, when suddenly a frightful thought struck her.

"Surely this carriage faces the sea?" she cried in tones of horror.

"Certainly," the other lady returned sweetly.

"And we go backwards? And I can't," she gasped.

Then followed a deadly battle with the conductor, compared with which
the skirmish in the Douane ranked as a polite difference of opinion.
Gallantly facing this awful gold-braided personage, who at first was to busy
to be spoken to, and, on the advice of her fellow victim, bombarding him
with reproaches in such scattered remnants of French as an extreme effort
of will could summon from the recesses of an exhausted brain, and vainly
looking meanwhile in every direction for the civil and paternal Cooks'
Interpreter of advertisements and letters, Ermengarde told how she had
booked through the perfidious Cook a seat facing the engine, and could not
by any means travel in any other way and must have another carriage. A
civil flow of idiomatic provincial French, upon which the words Marseilles
and Paris floated at intervals, in reply, conveyed nothing but distraction to
her mind. Finally she demanded an exchange of seats with some traveller
who liked going backwards, in three separate languages, and heard in two
that madame had better monter vite, as the train was off.

During this engagement she was much annoyed by the efforts of a man
in a furred coat, of whose observation she had been indignantly conscious
before, to divert the official's attention to himself, in which he at last
succeeded by some mystic sign (probably Masonic) conveyed by a touch of
the hand in which something glittered in the sunshine. At this juncture the
other lady appeared on the car steps, and drawing her inside, explained that
it would be all right if she would only wait till the people were settled in the
now moving train, and found her a slip seat in the corridor, with which the
hapless Ermengarde was obliged to content herself, facing forward, and
cherishing deep resentment against the man in the fur collar, whose
mysterious and insistent gaze from behind coloured spectacles had
continually followed her since her arrival at the train. She felt that in some
vague way her misfortunes were owing to this creature's malevolence.

"He looks like an Anarchist or a Nihilist," she confided to the lady.


"He's a Russian; these great hairy men always are—unless they are Jews or
both."

"Are all Russians Nihilists and Anarchists?" the lady asked.

"Always, when they get out of Russia, unless they are diplomatists. He
was hiding a box under his coat. Filled with dynamite, no doubt."

"To blow us all up? Oh! I don't think we are worth that. No celebrities
on board to-day. Are you going all the way to the Riviera? You look so
tired. Recovering from influenza? So tedious. Pray let me help you all I
can."

In spite of her civility there was something repellant to Ermengarde in


this young woman, a preoccupation, a reticence, that she mistrusted. Surely
that voice was familiar, and the face too; she must have met her, though
quite at a loss to say where or when. But at her question on this point there
was a brief negative and a sudden retreat from the first cold, calculated
approach to friendliness. The face became an utter blank, and vanished
behind a periodical.
The train flew; the hairy-faced Nihilist had ended his discussion with
the conductor, and was standing in the corridor by a window, surveying the
flying landscape and plunged in meditations, dark and evil, no doubt, and
probably hatching villainous schemes for the destruction of society. People
went up and down the corridor, brushing and stumbling over her skirts,
mistaking their compartments, and alternately losing and finding, after
much tumult, friends, bags, caps, smoking and restaurant cars. And this was
to last all the way to Paris.

The man of mystery might as well let off his infernal machine at once,
and have done with it; the slip-seat was narrow, the train rocked as it flew,
and Ermengarde, aching wherever it is possible for humanity to ache, felt as
if she was breaking in halves at the waist. But what was her surprise and
pleasure in the misery of this dark moment to hear a respectful voice at her
ear requesting madame to be kind enough to take possession of a forward
compartment to Paris in the next carriage, and to find herself at last, as if by
enchantment, in the identical state-room of her dreams and the International
Sleeping Car Company's pictured advertisement, with its private dressing-
room, its airy space, its slip-seat under the window—"should the passenger
desire to change position"—and, better still, the whole compartment to
herself, but jusqu' à Paris only. What bliss to sink upon the deep, springy
seat, to cast aside heavy coat, furs, and hat; and close tired eyes for a
moment, and then open them and see the flying foreign landscape, chill,
bleak, powdered with snow, and bounded by sea, as they drew near
Boulogne!

But what gave the country that unlikeness to English chalk and heath-
lands, that charming unlikeness, so dear to new travellers, that gives the
feeling of being somewhere else, the true foreign touch? To this pleasure
she surrendered herself with drowsy content, forgetful of recent sufferings,
forgetful of the superb ragout peculiar to Calais somebody had solemnly
charged her to take at lunch in the long wait between train and boat,
forgetful of lunch to be had on the car, till the spectacle of a waiter carrying
tea past the door reminded her that "perfect meals are served," and that none
approaching that description had fallen to her lot since that far-off
yesterday, when the luxuries of travel had still been a dream. After many
and vain requests to the "civil attendants" to bring tea, she staggered to the
dining-car, wondering why the waiters all looked so absurdly drunk, and the
tables behaved as if they were at spirit-rapping séances, and wondering still
more when the modest cup of tea "for about tenpence" took a couple of
francs to pacify the staggering, taciturn waiter's demand. It was evident that
foreigners, civil and talkative when sober, are surly and taciturn when
drunk, just as Britons, surly and taciturn by nature, become over-civil and
garrulous in liquor.

Snow lay here and there on the bleak levels flying past the windows.
How small the cottages were! Cottages? No—huts—cottage was too cosy a
word for these poor cabins. What a poverty-stricken country; the very trees
lopped and starved of branch, starved houses, starved peasants ploughing
with horse-ploughs, no comfort, no prosperity anywhere; all like a pinched,
starved England, till after Boulogne, where sand blowing about from the
great dunes was a distinct foreign note. What if the train was over-hot?
Cold, cold it was outside, and, if the windows were opened, the wind cut in
like a sword. A city of a splendid tower lay in the cold light after a pale
pink sunset; the rushing, rocking train came to a stop by a dusky, empty
platform, where a solitary, starved-looking boy stood motionless, cold in the
cold twilight, his arms rolled in his apron, listless, benumbed. This must be
Amiens, or else some dim city of twilit dreamland; mortal railway station it
could hardly be, so dim, so chill, so empty, so silent, with no passengers, no
officials, only that one ghostly train, whence none descended and whither
none climbed, hissing furtively in the greyness, while vague figures in
blouses passed silently by, tapping thoughtfully at the wheels now and then,
and the thin, hunger-pinched boy looked listlessly about him, his bare arms
rolled in his apron. Evidently nobody ever goes to French cathedral cities
except to stay there; perhaps even the boy was only a statue, the latest
triumph of realistic art.

This grey, starved country, so different from rich, cosy England, would
have been depressing but for the swift rush of the rocking train, the warm,
downy comfort of the carriage, and the fairy-like strangeness that gave
everything an air of unreality. If only Charlie were there, his clear eyes wide
with pleasure, sharing the fascination, enjoying the motion, asking
impossible questions, and making bewildering comments! Monstrous to
send such a baby to a school of rough boys. She was not spoiling him, as
his father declared; he was not getting womanish ways; children need
tenderness, and a boy may have charming manners and be a delightful
companion without being unmanly. At Easter he would come home, steeped
in savagery, inarticulate and slangy, full of the surly self-consciousness that
dreads to be thought anything but brutal, or to vary by a pin's head from
"other fellows." Arthur would be delighted, and say he liked boys to be
boys. Arthur, whose one aim in life appeared to be to avoid showing the
least sign of emotion or humanity, or anything comforting and pleasant.
When it came to saying good-bye, at his sudden departure on the eve of
hers, she had choked miserably and said nothing, her eyes brimming over;
but he—

"Well, good-bye, dear," she seemed still to hear in a cheerful,


indifferent, staccato voice, with a cold, light kiss on the face she lifted,
trembling and speechless. "Hope you'll enjoy it. Plenty of hats in Paris."

He was off before the last word, and had banged the door, and sprung
into his cab by the time her choke was overcome. If only he had not said
"dear," that commonplace symbol of conjugal indifference; "Ermengarde,"
with the faintest inflection of tenderness, would have made all the
difference—she could even have borne the reference to hats had he said
something nicer than "dear."

The twilight deepened, and the train became a flying meteor of linked
lights; she grew more and more inclined to accept the rift in the lute and
make the best of it. Her man had his good points, and all men seemed to be
made of hard, unloving stuff; why seek sympathy in the impossible region
of rocky male hearts? As for the scene in the study, she may have put a
wrong interpretation upon it; she would not admit that she had ever given it
the worst; it might mean some passing infatuation, resisted, perhaps
overcome, at the utmost—or some harmless mystery, that five words would
have made clear. Of course, men should not have secrets from their wives;
but equally of course, men did. It was well to be away for a time; new
experiences would put all this trouble in the background and show it in true
perspective; she would wipe it clean off her memory and begin again,
harden her heart, take all cheerfully, without show of feeling, answering
chaff with chaff; weakness had made her over-sensitive, returning health

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