Recent Brazilian initiatives to address legal gaps and barriers that negatively impact the development of the national space industry

When trying to construct a national space industry, developing nations are often hindered by limited financial resources and a lack of technical expertise. This situation is compounded by legal gaps and barriers that prevent governments from properly addressing these challenges, and also create uncertainty for private investors. The example of Brazil is particularly illustrative: although the country has set out a clearly defined national space policy (National Policy for the Development of Space Activities (PNAE) 2012-2021), it is burdened with legal and managerial obstacles that prevent the policy from achieving its aims. These obstacles include the lack of a general national space law combined with the existence of a fragmented regulatory regime and a complex tax system that especially encumbers the private sector. Additionally, the Brazilian Space Agency (AEB) lacks the necessary financing and autonomy required to function in its role as coordinator of the National System for the Development of Space Activities (SINDAE), which itself is badly fragmented. In order to address these issues, there should be efforts to improve domestic cooperation amongst government agencies as well as the private sector by focusing on common national goals. In this regard, the National Council for the High Studies and Technological Evaluation of the Brazilian House of Representatives examined some alternatives that the national government could adopt to foster the development of space activities. The Council suggested that the implementation of a PNAE should be pursued further, and proposed the passage of a bill, currently under review in the Senate, to provide tax incentives, including tax cuts, in order to stimulate the importation of goods to be used by the space industry. Such a law would act similarly to the Provisional Decree n.544/11, passed in 2012, which revised national security policies in order to rescind some taxes as well as simplify the importation of goods used by the defense space industry. Since many space technologies are dual-use, such a law could positively affect the private sector as well. Another approach is to view Brazilian space activities as a combined priority for both civil and military programs, including reforming existing legal and regulatory regimes in order to create a more effective structure for development of space activities in order to avoid both fragmentation and duplication of objectives amongst various government agencies. This paper aims to analyze these recent initiatives, and to assess their impact on the Brazilian space industry. This includes an examination of the legal gaps in the Brazilian space sector which could be addressed by the enactment of the general law for space activities which, in turn, would simplify the existing system by improving financial and managerial functions of the Brazilian Space Agency; and the removal of unnecessary legal barriers that impede the operation of the domestic space industry. The authors hope that their analysis could assist other developing nations that presently facing similar challenges.