Italy's New Space Economy Law
Italy pushes to establish its own framework but leaves crucial details for Brussels to decide
Italy's parliament approved a new Space legislation in June 2025, just weeks before the European Commission announced plans for a unified European Space Act. The timing reflects a delicate balancing act: establishing national authority over space activities while leaving room for the broader regulatory framework that Europe desperately needs.
The Italian law, formally titled "Disposizioni in materia di Economia dello Spazio" (Provisions on Space Economy), was first proposed in September 2024. Its approval comes as Europe grapples with the challenge of harmonizing space regulations across 27 member states, 12 of which have already established their own frameworks.
Europe's Regulatory Patchwork
The European Space Act aims to create unified "rules of the road" for space actors operating within or launching from EU territory. The legislation would address critical gaps in safety, cybersecurity, environmental sustainability, and traffic management, all areas where fragmented national approaches have created regulatory confusion.
The challenge lies in harmonizing existing national frameworks without overriding member state sovereignty. A March 2025 briefing from the European Parliamentary Research Service highlighted skepticism from several member states about ceding authority to Brussels.
The law's most significant feature may be what it doesn't include.
Finland and Sweden expressed concerns in March 2025 about the legal basis for EU intervention, arguing that the dual-use nature of most space technologies should prevent the EU from intervening in such a way as to create any impediment to national competence. Conversely, France has consistently supported EU-level legislation, while Germany, Slovakia, and Italy backed the initiative in December 2024, but with the caveat that it should focus on commercial activities and exclude sovereign space applications.
Italy's Approach
Italy's new space law appears designed to thread this needle. The 18-page statute, divided into five sections (titoli) and 31 articles, establishes a framework for the Italian Space Agency (ASI) to manage commercial space activities while avoiding detailed operational guidelines. The first four sections create a working framework for operational needs—registering space objects in an online registry, procedures for launch authorization, and liability frameworks—while the final section focuses on support and funding for the emerging space economy market.
The 2025 law builds on Italy's previous space legislation from 2018, which established the Interministerial Committee for Space and Aerospace Research Policies (COMINT, Comitato Interministeriale per le Politiche relative allo Spazio e alla Ricerca Aerospaziale) to coordinate national space strategy and oversee the Italian Space Agency. But that earlier framework predated the commercial space boom and left significant regulatory gaps. The 2018 law didn't address orbital debris, environmental sustainability, or radio spectrum management, issues the new legislation tackles head-on.
Will Italy's implementation decrees help or hinder its companies against European and international competitors?
The evolution reflects changing priorities: the 2018 framework focused on national coordination and long-term strategy, while the 2025 statute addresses the regulatory needs of an expanding commercial sector and growing international coordination requirements.
The new law covers authorization procedures for space activities, a registry for space objects, liability frameworks for damages, and incentives for the emerging commercial space sector. Notably, it includes provisions for a "riserva di capacità trasmissiva nazionale", a satellite-based emergency communication network that would be purchased exclusively from EU operators or Atlantic Alliance members, potentially opening the door to services from companies like Starlink during national emergencies.
However, the law's most significant feature may be what it doesn't include. Critical operational details will be deferred to future "decreti attuativi" (implementation decrees), leaving the current legislation as more of a declaration of intent than a practical guideline.
The Startup Dilemma
The 2025 Space Economy law targets the commercial sector, but its compliance requirements illustrate the cost concerns plaguing the industry.
"The mandatory third-party liability insurance coverage requires €100 million in coverage, with possible reductions to €50 or €20 million depending on company size," explains Matteo Cappella, Head of Regulatory Affairs at Leaf Space, an Italian ground segment provider. "These are among the highest requirements in the world. The costs could be substantial—not just financial, but also in human capital needed to negotiate such complex coverage.”
The insurance burden reflects broader industry concerns about regulatory overreach. In a 2023 position paper, ASD-Eurospace warned that excessive compliance costs could undermine European competitiveness rather than enhance it. The organization called for adequate transition periods and transparent stakeholder consultation processes.
Leaf Space echoes these concerns, advocating for "an adequate transition period so that satellite operators can adapt their planned or upcoming systems and the competent authority can, in collaboration with industry, develop the necessary processes and expertise." The company also emphasized the need for transparency and dialogue, noting that "the US system is incredibly complex and costly for operators, but it remains unmatched in terms of transparency and the ability to foster bilateral exchanges between operators and regulators."
Waiting for Brussels
Italy's cautious approach reflects the reality that the EU Space Act remains under negotiation. The European Commission expects Parliament and Council discussions to conclude by year-end under Denmark's rotating presidency, which runs from July through December 2025.
Italy's strategy appears calculated to avoid conflicts with the forthcoming EU legislation while ensuring the country has the basic legal infrastructure to participate in European space governance. The law mentions environmental sustainability, cybersecurity, and radio spectrum use but deliberately avoids taking the lead on operational guidelines.
The Path Forward
Implementation in Europe involves multiple stages of regulatory decrees, often extending across several years and legislative cycles. The success of Italy's approach will depend on how well it adapts to the final EU Space Act and whether the country's commercial space sector can compete effectively under the new regulatory framework.
Key questions remain: How will other European countries respond to the EU Space Act when finalized? How will the industry prepare for new regulations, and what support will Europe provide? Most critically, will Italy's implementation decrees help or hinder its companies against European and international competitors?
The answers will ultimately determine whether Italy's measured approach successfully balances national sovereignty with European integration in the rapidly evolving space economy.