§ 70112. — Liability insurance and financial responsibility requirements.
[Laws in effect as of January 7, 2003]
[Document not affected by Public Laws enacted between
January 7, 2003 and December 19, 2003]
[CITE: 49USC70112]
TITLE 49--TRANSPORTATION
SUBTITLE IX--COMMERCIAL SPACE TRANSPORTATION
CHAPTER 701--COMMERCIAL SPACE LAUNCH ACTIVITIES
Sec. 70112. Liability insurance and financial responsibility
requirements
(a) General Requirements.--(1) When a launch or reentry license is
issued or transferred under this chapter, the licensee or transferee
shall obtain liability insurance or demonstrate financial responsibility
in amounts to compensate for the maximum probable loss from claims by--
(A) a third party for death, bodily injury, or property damage
or loss resulting from an activity carried out under the license;
and
(B) the United States Government against a person for damage or
loss to Government property resulting from an activity carried out
under the license.
(2) The Secretary of Transportation shall determine the amounts
required under paragraph (1)(A) and (B) of this subsection, after
consulting with the Administrator of the National Aeronautics and Space
Administration, the Secretary of the Air Force, and the heads of other
appropriate executive agencies.
(3) For the total claims related to one launch or reentry, a
licensee or transferee is not required to obtain insurance or
demonstrate financial responsibility of more than--
(A)(i) $500,000,000 under paragraph (1)(A) of this subsection;
or
(ii) $100,000,000 under paragraph (1)(B) of this subsection; or
(B) the maximum liability insurance available on the world
market at reasonable cost if the amount is less than the applicable
amount in clause (A)(i) or (ii) of this paragraph.
(4) An insurance policy or demonstration of financial responsibility
under this subsection shall protect the following, to the extent of
their potential liability for involvement in launch services or reentry
services, at no cost to the Government:
(A) the Government.
(B) executive agencies and personnel, contractors, and
subcontractors of the Government.
(C) contractors, subcontractors, and customers of the licensee
or transferee.
(D) contractors and subcontractors of the customer.
(b) Reciprocal Waiver of Claims.--(1) A launch or reentry license
issued or transferred under this chapter shall contain a provision
requiring the licensee or transferee to make a reciprocal waiver of
claims with its contractors, subcontractors, and customers, and
contractors and subcontractors of the customers, involved in launch
services or reentry services under which each party to the waiver agrees
to be responsible for property damage or loss it sustains, or for
personal injury to, death of, or property damage or loss sustained by
its own employees resulting from an activity carried out under the
applicable license.
(2) The Secretary of Transportation shall make, for the Government,
executive agencies of the Government involved in launch services or
reentry services, and contractors and subcontractors involved in launch
services or reentry services, a reciprocal waiver of claims with the
licensee or transferee, contractors, subcontractors, and customers of
the licensee or transferee, and contractors and subcontractors of the
customers, involved in launch services or reentry services under which
each party to the waiver agrees to be responsible for property damage or
loss it sustains, or for personal injury to, death of, or property
damage or loss sustained by its own employees resulting from an activity
carried out under the applicable license. The waiver applies only to the
extent that claims are more than the amount of insurance or
demonstration of financial responsibility required under subsection
(a)(1)(B) of this section. After consulting with the Administrator and
the Secretary of the Air Force, the Secretary of Transportation may
waive, for the Government and a department, agency, and instrumentality
of the Government, the right to recover damages for damage or loss to
Government property to the extent insurance is not available because of
a policy exclusion the Secretary of Transportation decides is usual for
the type of insurance involved.
(c) Determination of Maximum Probable Losses.--The Secretary of
Transportation shall determine the maximum probable losses under
subsection (a)(1)(A) and (B) of this section associated with an activity
under a license not later than 90 days after a licensee or transferee
requires a determination and submits all information the Secretary
requires. The Secretary shall amend the determination as warranted by
new information.
(d) Annual Report.--(1) Not later than November 15 of each year, the
Secretary of Transportation shall submit to the Committee on Commerce,
Science, and Transportation of the Senate and the Committee on Science
of the House of Representatives a report on current determinations made
under subsection (c) of this section related to all issued licenses and
the reasons for the determinations.
(2) Not later than May 15 of each year, the Secretary of
Transportation shall review the amounts specified in subsection
(a)(3)(A) of this section and submit a report to Congress that contains
proposed adjustments in the amounts to conform with changed liability
expectations and availability of insurance on the world market. The
proposed adjustment takes effect 30 days after a report is submitted.
(e) Launches or Reentries Involving Government Facilities and
Personnel.--The Secretary of Transportation shall establish requirements
consistent with this chapter for proof of financial responsibility and
other assurances necessary to protect the Government and its executive
agencies and personnel from liability, death, bodily injury, or property
damage or loss as a result of a launch or operation of a launch site or
reentry site or a reentry involving a facility or personnel of the
Government. The Secretary may not relieve the Government of liability
under this subsection for death, bodily injury, or property damage or
loss resulting from the willful misconduct of the Government or its
agents.
(f) Collection and Crediting Payments.--The head of a department,
agency, or instrumentality of the Government shall collect a payment
owed for damage or loss to Government property under its jurisdiction or
control resulting from an activity carried out under a launch or reentry
license issued or transferred under this chapter. The payment shall be
credited to the current applicable appropriation, fund, or account of
the department, agency, or instrumentality.
(Pub. L. 103-272, Sec. 1(e), July 5, 1994, 108 Stat. 1336; Pub. L. 104-
287, Sec. 5(74), (93), Oct. 11, 1996, 110 Stat. 3396, 3398; Pub. L. 105-
303, title I, Sec. 102(a)(12), Oct. 28, 1998, 112 Stat. 2850.)
Historical and Revision Notes
Pub. L. 103-272
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Revised Section Source (U.S. Code) Source (Statutes at Large)
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70112(a)(1), (2)...................... 49 App.:2615(a)(1)(A) (1st Oct. 30, 1984, Pub. L. 98-575, Sec.
sentence), (B) (1st sentence). 16(a), (c), 98 Stat. 3061; restated
Nov. 15, 1988, Pub. L. 100-657, Sec.
5(a), 102 Stat. 3901, 3905.
70112(a)(3)........................... 49 App.:2615(a)(1)(A) (last
sentence), (B) (last
sentence).
70112(a)(4)........................... 49 App.:2615(a)(2).
70112(b)(1)........................... 49 App.:2615(a)(1)(C).
70112(b)(2)........................... 49 App.:2615(a)(1)(D).
70112(c).............................. 49 App.:2615(a)(3) (1st, 2d
sentences).
70112(d)(1)........................... 49 App.:2615(a)(3) (last
sentence).
70112(d)(2)........................... 49 App.:2615(a)(4).
70112(e).............................. 49 App.:2614(c). Oct. 30, 1984, Pub. L. 98-575, Sec.
15(c), 98 Stat. 3061; restated Nov.
15, 1988, Pub. L. 100-657, Sec. 5(b),
102 Stat. 3905.
70112(f).............................. 49 App.:2615(c).
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In subsection (a), the word ``particular'' is omitted as surplus.
In subsection (a)(1), before clause (A), the word ``sufficient'' is
omitted as surplus. In clauses (A) and (B), the words ``in connection
with any particular launch'' are omitted as surplus.
In subsection (a)(4), before clause (A), the words ``made . . . a
requirement described in'' are omitted as surplus.
In subsection (b)(2), the words ``department, agency, and
instrumentality of the Government'' are substituted for ``Federal
agency'' for consistency in the revised title and with other titles of
the United States Code.
In subsection (d)(2), the words ``if appropriate'' are omitted as
surplus.
In subsection (f), the words ``department, agency, or
instrumentality of the Government'' are substituted for ``Federal agency
or department'' for consistency in the revised title and with other
titles of the Code. The words ``insurance proceeds or . . . other'' and
``proceeds or other'' are omitted as surplus.
Pub. L. 104-287, Sec. 5(93)
This amends 49:70112(a)(3)(B) to clarify a cross-reference in the
codification enacted by section 1 of the Act of July 5, 1994 (Public Law
103-272, 108 Stat. 1337).
Amendments
1998--Subsec. (a)(1). Pub. L. 105-303, Sec. 102(a)(12)(A), inserted
``launch or reentry'' before ``license is issued''.
Subsec. (a)(3). Pub. L. 105-303, Sec. 102(a)(12)(B), inserted ``or
reentry'' after ``one launch'' in introductory provisions.
Subsec. (a)(4). Pub. L. 105-303, Sec. 102(a)(12)(C), inserted ``or
reentry services'' after ``launch services'' in introductory provisions.
Subsec. (b)(1). Pub. L. 105-303, Sec. 102(a)(12)(D)-(F), inserted
``launch or reentry'' before ``license issued or transferred'', ``or
reentry services'' after ``launch services'', and ``applicable'' after
``carried out under the''.
Subsec. (b)(2). Pub. L. 105-303, Sec. 102(a)(12)(E), (F), inserted
``or reentry services'' after ``launch services'' wherever appearing and
``applicable'' after ``carried out under the''.
Subsec. (e). Pub. L. 105-303, Sec. 102(a)(12)(G), (H), inserted ``or
Reentries'' after ``Launches'' in heading and ``or reentry site or a
reentry'' after ``launch site'' in text.
Subsec. (f). Pub. L. 105-303, Sec. 102(a)(12)(I), inserted ``launch
or reentry'' before ``license issued or transferred''.
1996--Subsec. (a)(3)(B). Pub. L. 104-287, Sec. 5(93), substituted
``clause (A)(i) or (ii)'' for ``clause (A)''.
Subsec. (d)(1). Pub. L. 104-287, Sec. 5(74), substituted ``Committee
on Science'' for ``Committee on Science, Space, and Technology''.
Effective Date of 1996 Amendment
Amendment by section 5(93) of Pub. L. 104-287 effective July 5,
1994, see section 8(1) of Pub. L. 104-287, set out as a note under
section 5303 of this title.
Termination of Reporting Requirements
For termination, effective May 15, 2000, of provisions of law
requiring submittal to Congress of any annual, semiannual, or other
regular periodic report listed in House Document No. 103-7 (in which the
2nd item on page 133 identifies a reporting provision which, as
subsequently amended, is contained in subsec. (d)(1) of this section),
see section 3003 of Pub. L. 104-66, as amended, set out as a note under
section 1113 of Title 31, Money and Finance.
Liability Regime for Commercial Space Transportation
Pub. L. 106-405, Sec. 7, Nov. 1, 2000, 114 Stat. 1752, provided
that:
``(a) Report Requirement.--Not later than 18 months after the date
of the enactment of this Act [Nov. 1, 2000], the Secretary of
Transportation shall transmit to the Congress a report on the liability
risk-sharing regime in the United States for commercial space
transportation.
``(b) Contents.--The report required by this section shall--
``(1) analyze the adequacy, propriety, and effectiveness of, and
the need for, the current liability risk-sharing regime in the
United States for commercial space transportation;
``(2) examine the current liability and liability risk-sharing
regimes in other countries with space transportation capabilities;
``(3) examine the appropriateness of deeming all space
transportation activities to be `ultrahazardous activities' for
which a strict liability standard may be applied and which liability
regime should attach to space transportation activities, whether
ultrahazardous activities or not;
``(4) examine the effect of relevant international treaties on
the Federal Government's liability for commercial space launches and
how the current domestic liability risk-sharing regime meets or
exceeds the requirements of those treaties;
``(5) examine the appropriateness, as commercial reusable launch
vehicles enter service and demonstrate improved safety and
reliability, of evolving the commercial space transportation
liability regime towards the approach of the airline liability
regime;
``(6) examine the need for changes to the Federal Government's
indemnification policy to accommodate the risks associated with
commercial spaceport operations; and
``(7) recommend appropriate modifications to the commercial
space transportation liability regime and the actions required to
accomplish those modifications.
``(c) Sections.--The report required by this section shall contain
sections expressing the views and recommendations of--
``(1) interested Federal agencies, including--
``(A) the Office of the Associate Administrator for
Commercial Space Transportation;
``(B) the National Aeronautics and Space Administration;
``(C) the Department of Defense; and
``(D) the Office of Space Commercialization; and
``(2) the public, received as a result of notice in Commerce
Business Daily, the Federal Register, and appropriate Federal agency
Internet websites.''
Section Referred to in Other Sections
This section is referred to in section 70113 of this title; title 42
section 2458c.
