Dispute Settlement in Outer Space: an odyssey in the making

I. Outer space and dispute settlement: a glimpse of the last five decades.

Space: the last frontier. Since the launch of the first artificial satellite Sputnik 1, which started the “Space Age” back in 1957, Humanity has been actively present in outer space. At that time, space activities were conducted by a handful of countries, and in practice only by the former USSR and the US, the two belligerent superpowers of the Cold War era. The first discussions on space activities within the United Nations (UN) showed the international community’s main concern to anticipate and therefore prevent a scenario of militarization of outer space, as well as to promote exploration and use of outer space for peaceful purposes only: this is the origin of Space Law. As early as 1961, the UN General Assembly adopted the Resolution 1721 (XVI), 20 December 1961, laying down the first core legal principles applicable to outer space. Such principles were then crystallized in 1967 with the approval and entry into force of the “Outer Space Treaty” (OST), which was followed by four other treaties, among them the 1972 “Liability Convention” (LIAB).

As these treaties were drafted at a time when only a few States possessed space industry and capability, one can understand why the OST established a State liability regime, i.e., in addition to their own activities, States are also responsible and liable for their private entities. The LIAB would further develop the provisions laid down in the OST, defining damage from a collision perspective, whether it is a bodily damage (loss of life and injury) or a material damage. In addition, the LIAB adopted the “Launching State” criterion, the basis of its dual system of liability: (i) objective/absolute liability, for damages caused by space objects on the surface of the Earth or to aircraft in flight; and (ii) subjective/fault liability, i.e., damages being caused elsewhere than on the surface of the Earth to a space object of one launching State or to persons or property on board such a space object by a space object of another launching State. To this end, LIAB holds States liable for damage caused by their space objects and comprises a dispute resolution procedure consisting of diplomatic negotiations followed by the establishment of a Claims Commission. However, this mechanism is only available to States and not to private parties – or rather, any private entity would need to resort to its respective State, which will then diplomatically approach the other State(s) in question, and the latter may not even have anything to do directly with the dispute, in case it concerns another private entity registered in that country – and the award given by the Claims Commission is of a merely recommendatory nature, unless States involved agree otherwise. The LIAB was invoked only one time: in 1978, the Soviet satellite “Cosmos 954” crashed on Canadian territory, and Canada issued a claim against the USSR, but the dispute was eventually resolved through diplomatic channels, with the specific amount paid to Canada being unknown to this day.

Even though the LIAB still remains very relevant today, its legal framework presents many difficulties and has very limited practical use for commercial space entities. In fact, given the accelerated increase of private actors in space, the UN recommends and encourages States to develop their own national space laws, outlining, e.g., the scope of application of activities to be addressed, conditions for authorization and licensing or insurance requirements. Besides, considering the world and present-day challenges, it is not the appropriate legal instrument to address and settle other types of disputes, such as investor-state disputes or any others regarding complex, multi-party, international contracts. 

II. Outer space in the 21st century: many actors, activities, and disputes. A role for arbitration?

Over the course of the last three decades, space has evolved from a status of a vast majority of state-owned space objects and activities to a much broader presence of non-state actors, notably, private commercial space entities, developing a wide range of space applications (e.g., telecommunications, satellite navigation, etc.), thus entering the space industry, in contrast with a previous (almost) exclusive public environment – representing the so-called “New Space”. But along with new actors and opportunities, new obstacles also arise, including legal ones. As outer space is open to more and more private entities, the number of space objects also increases, thus, the congestion of Earth’s orbits (specially, the lower earth orbit) adds substantial risks to space operations which are exposed to a greater danger for collisions, one of the reasons for the growing need for space traffic management tools. Moreover, such growth of space activities has led to an increasing amount of space debris that will most likely cause more accidents. In this context, as space gets more “crowded”, the risk of damages to space objects consequently increases, including those of non-governmental actors.

It goes without saying that if the number of actors in space is gradually rising, it will soon result in more disputes. But disputes are not only those based on collisions, as they may encompass any contractual disputes that may arise, e.g., satellite-related disputes; disputes regarding any components of the space industry, from manufacturing, to launching, and operating; seizure of assets related to space-related contracts; disputes relating to the launch of space objects into space orbits; as well as disputes in regulatory, insurance or even intellectual property rights domains. Consequently, space disputes are (and will be) numerous, diverse, and complex, which may include States, private actors, or both. In the latter cases, international space law does not have a specific dispute resolution mechanism available for private parties.

As highlighted, although such private entities can indeed request the State to trigger the application of the LIAB, the Convention operates via diplomatic channels that certainly presents an uncertain outcome based on a burdensome procedure that is ultimately non-binding and unsuitable for many disputes. This being said, non-state actors lack legal resources provided to States by international law, and domestic litigation addressing cross-border space disputes is also likely to be insufficient in many levels because obstacles such as lengthy decisions on the  jurisdiction of national courts or the applicable law, loss of confidentiality, uncertainty about the recognition and enforcement of judgments in other jurisdictions, as well as possible scenarios on sovereignty immunity if the claim is filled against a State. As many legal scholars point out, space, space activities, and the diversity of space actors mean that space law should not rely solely on a unique dispute resolution mechanism, instead, it should be open to a diversity of legal instruments to address cross-border and highly complex disputes.

In this context, in recent years we have witnessed the emergence of alternative dispute resolution (ADR) in space, with a clear preference for arbitration: in 2011, the Permanent Court of Arbitration adopted its “Permanent Court of Arbitration Optional Rules for Arbitration of Disputes Relating to Outer Space Activities,”; last year, Dubai has established its own specialized “Space Court.” On a broader international scale, it appears as though the role of arbitration for space disputes is not an “alternative” but is by far the default option for resolving disputes. This is not surprising considering that international contracts usually have an arbitration clause, and arbitration truly is the most popular solution chosen by the parties in light of the technical complexity associated with space issues. For example, it is well-known that the European Space Agency has been preferring arbitration in its model contracts for some time. Arbitration is anchored on several principles, including, e.g., that of consent of the parties and the principle of autonomy.

If parties do consent and submit their dispute to arbitration – without prejudice of space accidents between parties not bound by any contractual relationship, and thus lacking an opportunity to agree to submit a possible dispute to arbitration – parties may appoint their respective arbitrators, surely to be chosen based on their expertise and know-how required to handle space matters and understand the characteristics of a specific case. Besides, flexibility and suitability are features in arbitration proceedings, both international and domestic, that escape from the rigidity of the so called “one-size-fits-all” of national courts, and which renders them inappropriate to resolve outer space disputes.

On a final note, it is also known the possibility of investor-state dispute settlement regarding space activities, whose bilateral and multilateral investment treaties around the world contain arbitration clauses that could allow, as the case may be, a private entity (investor) to choose the applicable rules, for example, ICSID Arbitration Rules or the ICC Rules of Arbitration – this is a very interesting but complex topic, worthy of considerations in a future article.

III. Outlooks

The current international framework addressing dispute settlement in outer space, foreseen both the LIAB and the OST, although of greater importance, does not provide favourable mechanisms to facilitate outer space disputes to private entities, particularly because space technologies, applications and activities have grown at a much faster pace than the legal system drafted back in the 1960s and 1970s. ADR proceedings, notably arbitration, both international and domestic, are useful and capable of resolving disputes on a wide variety of space-related issues, and may indeed help space stakeholders, public and private, to overcome legal pitfalls.

Victoria Associates has a unique track record in all sorts of international proceedings with a keen interest and focus on international arbitration, including international commercial and investment disputes, but also advising and representing clients in ADR proceedings in domestic arbitration and litigation before national courts in jurisdictions where we are qualified.

Above all, Victoria Associates’ members understand their clients’ business and motivation, helping them “reaching for the stars”.

João Nuno Frazão

Victoria Associates

joao@victoria.associates

Portuguese International Arbitration – Chapter of the International Comparative Legal Guides

A practical cross-border insight into international arbitration work.

Victoria Associates’ members Duarte Henriques, João Frazão and Teresa Roldão (trainee), in collaboration with International Comparative Legal Guides (iclg.com), have written the International Arbitration Portuguese Guide*.

This Guide provides an overview of the most important aspects of the Portuguese International Arbitration legal framework and practice related to arbitration.

The Guide provides answers to questions such as:

  • What has been the approach of the national courts to the enforcement of arbitration agreements?
  • Are there any subject matters that may not be referred to arbitration under the governing law of your jurisdiction? What is the general approach used in determining whether or not a dispute is “arbitrable”?
  • Are there any limits to the parties’ autonomy to select arbitrators?

Read the full Guide HERE and contact us if you have any question (info@victoria.associates)


About Victoria Associates

Victoria Associates is international and knows no borders. 

We are qualified to practice in France, Arizona, California, D.C., Massachusetts, New York, England & Wales, Portugal,  Spain, Greece, Frankfurt, Brazil and Venezuela.  

We work in English, Greek,  French, German, Spanish and Portuguese.

We advise and represent our clients in international commercial arbitration, investment arbitration and sports arbitration. Our team has vast experience in representing clients in arbitral proceedings under the rules of the main international arbitration institutions, including the Court of Arbitration for Sport – CAS, the International Chamber of Commerce – ICC, the International Centre for Settlement of Investment Disputes – ICSID, the London Court of International Arbitration – LCIA, the American Arbitration Association (AAA) and its international arm (ICDR), as well as in “ad hoc” arbitrations under the UNCITRAL Arbitration Rules. While Victoria Associates covers disputes in a wide range of business and commercial areas, our team has strong expertise in disputes related to Banking & Finance Law, Oil & Gas, Insurance & Reinsurance, Shipping, Energy, Public International Law and Human Rights, Construction, Engineering & Real Estate, Distribution, Business & Commercial Law, Intellectual Property and Internet Gaming, Mergers & Acquisitions and International Frauds and tracing assets.


* First published in the ICLG – International Arbitration –

https://iclg.com/practice-areas/international-arbitration-laws-and-regulations/portugal

Katie Hyman & João Nuno Frazão Join Victoria Associates

It is our pleasure to announce the Victoria Associates’ new members. Katie Hyman, based in Washington DC, and João Nuno Frazão, based in Lisbon joined Victoria Associates as of September 2020.

Katie Hyman is dual-qualified as an English solicitor and New York attorney and is admitted as a special legal consultant in the District of Columbia. She is widely experienced in international dispute resolution, including multijurisdictional, offshore and investor-state matters.

Katie represents a variety of clients, including in the energy and telecoms industries, in high-value, complex international commercial arbitration proceedings under the major arbitral rules all over the world, as well as in investor-state arbitrations. She is a Fellow of the Chartered Institute of Arbitrators, and accepts arbitrator appointments in addition to her practice as counsel.

With this addition, Victoria Associates has now offices in Washington D.C.

João Nuno Frazão is a lawyer qualified in Portugal, admitted to the Portuguese Bar Assocation in 2016. João is a PhD candidate at Nova School of Law, with research focused on Space Law, International Law and European Law.

Kyriaki Noussia and Ted Folkman Join Victoria Associates

Victoria Associates welcome new members Kyriaki Noussia and Ted Folkman.

With the addition of Kyriaki and Ted (alongside Miguel Salas’ joining in April), Victoria Associates has now three new “ports” for our international practice (Athens, Boston and Seville).

Kyriaki, Ted and Miguel will contribute immensely to growing Victoria Associates’ wealth of knowledge and expertise in their respective areas. Further, Victoria Associates is also increasing the number of areas of the law where we can deliver services, such as oil and gas, shipping and insurance.

Kyriaki Noussia

Kyriaki Noussia

Dr. Kyriaki Noussia is a Greek Lawyer, an Arbitrator and an Academic (Senior Lecturer in Law (Law School, University of Exeter, UK). She is a admitted to the Athens Bar (Greece) and licensed to appear in front of the Greek Supreme Court (Areos Pagos) and the Greek Conseil d’ Etat (Supreme Administrative Court). She has extensive experience in dispute resolution and arbitration and has regularly advised and acted on matters in various areas of law, most notably insurance, reinsurance, shipping, energy, environmental, construction and investment law. Later acquired expertise includes the area of Law and Technology, such as issues relating to robotics and the law, the ethics of AI and the law, the regulation of Artificial Intelligence (AI) and its application in various industries and sectors as well as cybersecurity issues.  

Theodore J. Folkman

Ted Folkman

Theodore J. Folkman, a Boston lawyer, has twenty years of experience in civil and commercial litigation and arbitration and serves as a commercial arbitrator. He is widely regarded for his expertise in private international law and international judicial assistance.

Ted is experienced in complex civil and commercial litigation and arbitration, with a special emphasis in cross-border disputes, US judicial assistance in aid of proceedings abroad, and foreign sovereign immunity.

Victoria Associates Welcomes Miguel Salas and Sevilla !

Victoria’s reaching the starting point!

We are thrilled to share our latest news with you!

Victoria Associates has reached the starting point and is adding an office where it all has begun. Indeed, the expedition of Ferdinand Magellan truly begun in Sevilla, then the capital city of Castilla (Spain). Victoria was the only ship to return safely to its departure harbour, some three years later.

Now, Victoria Associates is proud to announce that it has an office in Seville, in one of its premium locations and just across the “Catedral de Sevilla” and the “Archivo General de Indias“.(1)

Through the incorporation of its new member, Miguel Salas, founder partner of Salas y Donaire, Victoria Associates is expanding its reach and is now able to provide any kind of services related to international disputes in Spain.

Miguel Salas is a seasoned lawyer, with 25+ years of experience, dealing in a number of areas of law, particularly litigation and arbitration.

With this addition, Victoria Associates not only boosts its reach but also and more importantly is welcoming a lawyer truly embedded in its spirit and values. It will surely be a tremendous and rewarding experience!

Bienvenido Miguel, bienvenida Sevilla,

¡ OLÉ !


(1) The General Archive of the Indies in Seville was founded in 1785 by King Carlos III, with the aim of centralising in a single place the documentation relating to the administration of the Spanish overseas territories that had been dispersed in various archives.

The archive conserves some 43,000 files, with some 80 million pages and 8,000 maps and drawings that come mainly from the entities responsible for the administration of the overseas territories. It was declared a World Heritage Site by UNESCO in 1987, along with the Cathedral and the Real Alcázar.

Why Arbitrate in Portugal? Reason 5 – Modern Country, Modern Facilities

Portugal & International Arbitration

Recently modernized infrastructures and facilities

Portugal is a developed country with many modern infrastructures and facilities. In recent times, Portugal has been considered a spearhead in terms of new technologies and IT solutions. This is especially relevant in terms of the fact that many of these new technologies have also been applied to the Portuguese judicial system.

Since the late 90’s, Portugal initiated a program to renovate and modernize its infrastructures, including court premises. The judicial system is supported by a modern IT infrastructure that allows almost every lawsuit to be managed online by court judges, court clerks and counsel. Almost every court judge will allow the taking of witness depositions via video-conferencing, including by Skype as well as other applications.

Portugal currently contains modern arbitration centres and state-of-the-art facilities to manage arbitrations and hold hearings. An example of those facilities may be found in the website of the Arbitration Centre of the Portuguese Chamber of Commerce and Industry (CAC) HERE.

Procedures before state courts are almost entirely managed through web-based platforms, the most important and notable of which is referred to as “Citius”, which was introduced by the Portuguese ministry of justice. Thanks to this web-based platform, paperless dockets have been a reality in Portugal for many years now. There are many other advantages of this platform including allowing for the submittal of court documents and decisions, as well as the consultation of proceedings by judges, lawyers and court clerks. Other advantages of this platform included notifications being provided online, as well as the logistical coordination of the proceedings themselves.

Arbitration has been benefiting from this new landscape, for example, if one party intends to begin arbitration and needs an interim measure; all that must be done is to file a request via the “Citius” web-based platform. The request will then arrive at the judge’s desk the following day. This online system works for every arbitration related matter that needs to be dealt with by state courts, with the exception of the Supreme Court of Justice.

What makes Portugal’s adaptation of modernized facilities and the usage of new technology in the judicial system is that not only has this greatly streamlined and facilitated the international arbitration dispute resolution process, but also that Portugal’s path to modernization, in comparison to other countries, has been less fraught with setbacks during this process.


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If you would like more information or have any questions regarding international arbitration in Portugal, please send us an email to info@victoria.associates and we will be in touch as soon as is possible.

Why Arbitrate in Portugal? Reason 4 – A Safe and Friendly Place

Portugal & International Arbitration

A safe, stable and reliable jurisdiction

Portugal, with its stable economic, political and legal systems has been growing increasing popular in the realm of being considered as an advantageous destination not only for tourism but also for the resolution of international arbitration disputes. Alongside this, Portugal is considered to be one of the safest countries in the world with a ranking as among the top 5 safest countries in the world, according to World Atlas.

With the recent destabilization in many European countries in regards to political, economic and even in terms of elevated terror threats, Portugal has remained among the very few which has remained stable in all these regards over the past years.

With the looming uncertainty of Brexit in the UK and the fact that the fate legal and political systems has been up in the air until the decision has been completely resolved, has deterred many from selecting the UK as a stable jurisdiction.

The rise of the extreme right in several other European countries has also served to destabilize not only their respective economies but has also brought uncertainty to the fate of their political and legal systems.

The rise of terrorism in Europe over the past few years in many countries has also served to dissuade many in seeking out these countries. There have been several significant terrorist attacks, and in some countries more than one attack, over the past decade alone in France, Germany, Norway, Ukraine, and the UK. Portugal’s terrorist threat index rate is the lowest within the EU, due to political, but also geographic reasons as it only borders Spain, with the other border being the Atlantic Ocean.

These considerations all factor into the selection of a safe and stable jurisdiction for the resolution of international arbitration disputes. Those who select Portugal as a jurisdiction have the peace of mind that at any given moment the political and legal systems won’t simply drastically change, thusly potentially negatively affecting the outcome of a successful resolution.

If you need more information, send us an email info@victoria.associates

Why Arbitrate in Portugal? Reason 3 – Legal Background

The Portuguese Legal Background & International Arbitration

Enduring legal ties between Lusophone Countries

The fact that the Portuguese Civil Code and Code of Civil Procedure are still in force in the Lusophone countries of Angola, Mozambique, Cape Verde, São Tomé Principe, and Guinea Bissau gives Portugal yet another advantage in terms of selecting a jurisdiction for international arbitration. These countries very closely follow, to this day, the Portuguese Case Law, meaning that Portuguese law is still very much embedded and relevant within their respective legal systems. Although these Lusophone countries have their own distinct identities, these countries still continue to share a strong historical and legal background.

Over the past decades many of the Lusophone countries have had their economies and respective investment opportunities grow substantially. Angola is considered to be one of the world’s top diamond producers as well as having many other investment opportunities in the realm of agriculture, construction and transportation sectors. Mozambique is another example with recently discovered natural gas reserves which has boosted, and is projected to continue to boost, its economy substantially. Macau is home to one of the largest gaming industries in the world, with total yearly revenue of about 28.9 billion US dollars. Among the aforementioned countries, Portugal itself is also quickly recovering from a financial crisis, and has been currently housing many technologically oriented startups due to currently having the lowest operational costs in Western Europe.

Due to the enduring legal ties and the rich economic and investment climate currently present within the Lusophone countries, Portugal poses as a strong platform for the resolution of international disputes. The fact that the legal ties still exist have shown to be a factor when deciding on the execution of bilateral agreements and in legal agreements between Lusophone countries and Portugal. Having a common language also eliminates the need for procedural translations and also ensures the trust amongst parties and arbitrators in dispute resolution.

Aside from this, and as mentioned in previous posts, Portugal is a member of the most important international arbitration conventions including the New York Convention of 1958.

The Commercial Arbitration Centre of the Portuguese Chamber of Commerce and Industry (CCIP), which was established in 1987, and has immense experience in the arbitrations of domestic and especially cross-border disputes involving Portuguese speaking countries.

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If you would like more information or have any questions regarding international arbitration in Portugal, please fill out the form below and we will be in touch as soon as is possible.

Why Arbitrate in Portugal? Reason 2 – Language

Language & International Arbitration

Portugal – a country with communication skills

The Language background

Language barriers are one of the most prominent cultural concerns when dealing with business matters in a foreign country, and this makes sense because a seemingly innocuous mishap in wording can lead to a failed business deal. This is even more relevant in the legal world, especially in regards to international arbitration where high stakes are involved.The language used in arbitration can have either a positive or negative impact on party equality since language plays a fundamental role not only during the written pleadings, but also and more importantly during the oral phases of the proceedings. Unfortunately, this is often overlooked and it is not uncommon that advocates and arbitrators find themselves at pains in understanding and showing command of the language used in the arbitration; thusly, this is a matter which should be carefully considered.Portugal has many attributes when it comes to the Portuguese language itself. Over 250 million people speak the Portuguese language throughout the world and it is currently considered to be the 6th most widely spoken language. Portugal also shares a great amount of cultural, economic and legal backgrounds which serve as a common tie between many other countries. Due to this, a large amount of commercial transactions worldwide deal with Portuguese speaking countries.Recently, Portugal has seen a substantial growth in terms of investment and capital flows, due to larger countries, such as Brazil and Angola viewing Portugal as a safe harbor for their investments.

Language to use in arbitration

Portuguese is of course the best language to use in arbitration involving parties from Portuguese speaking countries. But what happens when one of the parties (or both) do not speak Portuguese (but nevertheless consider the option to arbitrate in Portugal)?One may well say that Portugal is one of the countries within the EU well-known for its population having a good understanding and command of English. This is due to many reasons, but mostly due to the high importance that learning English is placed on the educational system as well as the fact that movies are subtitled, rather than dubbed as in many other Western European countries.As many Portuguese citizens are highly adept in their usage of English as a second language, with much of the population speaking relatively comprehensively, this means that when it comes to selecting a jurisdiction as well as the language of arbitration, there shouldn’t be any difficulties in regards to dealing with not just the legal system but also with locals, as well as in making other logistical arrangements.In other words, arbitrations in Portugal can interchangeably use Portuguese and English as working language.

Lisbon as an alternative to London after Brexit

Further, with the looming uncertainty of the end-result of Brexit, this has made the United Kingdom very unstable on many levels. With many legal aspects still to be ironed out in these proceedings, it might not be in the best interest to select the UK as a jurisdiction for international arbitration.It is important to highlight the importance of language when selecting a language for international arbitration. Portugal has many qualities which showcase it as an advantageous choice, with language being high on the list.

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If you would like more information or have any questions regarding international arbitration in Portugal, please send us an email to info@victoria.associates and we will be in touch as soon as is possible.

Duarte Henriques Appointed as VIAC’s International Advisory Board Member

Duarte G Henriques – Member of the International Advisory Board of the Vienna International Arbitral Centre

Duarte G Henriques, Victoria Associates’ founding member, has been appointed as member of the International Advisory Board of the Vienna International Arbitral Centre. The term will run from 2020 to 2022.

Check the composition of the International Advisory Board HERE !

Get in touch with us if you want to learn more about Victoria Associates – info@victoria.associates