Regulations are in the crosshairs. But which ones?

Early in President Donald Trump’s first term, he turned to an executive order to accelerate deregulation. For each new mandate enacted, he called for the repeal of two regulations.This year, he pushed further. On Jan. 31, Trump released an executive order calling for 10 regulations to be eliminated for each new one issued.Now, domestic and international space companies are watching carefully as the second Trump administration takes aim at federal regulations to determine what it could mean for how they operate and, ultimately, their bottom line.“Space and satellite companies are obviously very highly regulated entities,” said Drew Svor, space and telecommunications partner at the international law firm Sheppard Mullin. “There’s a lot of enthusiasm to see what that can bring, be it changes to the contracting process or cutting red tape for satellite and space operators.”While the details are unclear, industry executives generally anticipate reductions in environmental, antitrust and occupational safety regulations.“There will be regulatory reform both in the traditional space areas, but also financial and investment regulations that will impact the space business,” said Kevin O’Connell, the former Office of Space Commerce director who leads the consulting firm Space Economy Rising.Observers also expect the Trump administration to streamline acquisition policy.“To the extent upcoming acquisition policy changes bring clarification and efficiencies, they could be good for the space industry,” said Janna Lewis, the senior vice president of policy and general counsel of Astroscale US, the on-orbit servicing company. “As always, we would like to see a thoughtful balance in drafting and implementation, including appropriate allocation of resources and personnel.”But what’s next for export control regulations and the climate for foreign investment are more difficult to predict.“Donald Trump is the purest disruptor most any of us have ever encountered,” said Paul Stimers, who leads the space policy practice at law firm Holland & Knight. “The idea that we can predict the areas he will disrupt, the ways he will disrupt those areas, or the timing of those disruptions is folly.”As a result, Stimers advises clients to focus on resilience.“Build relationships with your friends in Congress, make new friends in Congress and develop your messaging capabilities,” Stimers said. “The people that are best able to both take advantage of positive disruption and weather negative disruption from their perspective are those who have created those capabilities for themselves.”Foreign investmentIndustry executives are also closely tracking regulations to foreign investment in the United States’ space sector.“We have this interesting tension right now where you have the second Trump administration putting it out there that ‘America’s open for investment. We want foreign capital,’” Svor said. “Something that somewhat balances that out is a recognition that the global dynamics are changing quite rapidly and there is the need to move forward a bit cautiously to make sure that your commercial relationships or deals or mergers and acquisitions transactions don’t get ensnared in political or regulatory risk that you might not have seen coming.”Since taking office Jan. 20, the Trump administration has announced “America First” policies designed to stop the country from being “taken advantage of by foreign nations or by rogue actors who undermine our sovereignty or security,” according to a Feb. 12 White House foreign relations fact sheet.During the first Trump administration, passage of the Foreign Investment Risk Review Modernization Act expanded the role of the Committee on Foreign Investment in the United States (CFIUS), an interagency panel led by the Treasury Secretary that examines the potential national-security implications of investments.Project 2025, the Heritage Foundation’s conservative policy blueprint, recommended the Defense Department co-chair CFIUS alongside the Treasury Secretary. The Trump administration has not endorsed Project 2025 overall, but some of the recent administration policies and executive orders mirror its proposals.“Making DOD an official CFIUS co-chair along with Treasury will establish a balanced committee process by elevating national security interests to an equal stature,” according to the 900-page Heritage Foundation document. Project 2025 also calls for CFIUS to publish information on penalties for CFIUS violations to “reduce the discretion of the committee to waive penalties or impose mere ‘wrist slap’ costs on violators of the law.”Hard questionsExecutives leading European and Asian space industry startups say they remain committed to expanding their presence in the United States, noting the U.S. government is the world’s largest customer for space products and services.“To build your reputation and work closely with the customer, you have to be there,” said the CEO of a European satellite component supplier who asked not to be identified.“That’s true in many of the European countries too. If you want to be in the U.K. market or France or Germany, you have to work there.”Still, this time of changing policies and regulations can be tricky to navigate, especially for companies with foreign ownership that have undergone extensive regulatory reviews to obtain security clearances.“Compliance is always top of mind for me,” Lewis said. “When we see [policy] shifts, my approach has to be, ‘I’m going to do whatever I need to do to ensure compliance, however uncertain the policy landscape might seem.’ That takes time and energy.”Even companies without strong international ties are struggling to keep up with federal personnel, budget and regulatory changes.“Investors are asking founders hard questions and there simply aren’t many answers at all, much less good answers,” said a former government executive who advises space startups. “I advise them to slow their burn rate, be conservative and stay as close to their customers as possible.”Export licensesSome of the difficult questions executives face focus on export controls. Rules published in October by the Biden administration’s Commerce Department to ease export of space- technologies to U.S. allies are on hold, pending review by Trump administration officials.“With any change in administration, you’re going to have a change in scope, especially with a change in party,” said Dak Hardwick, the vice president of international affairs at the Aerospace Industries Association. “We’ve not seen any indication that they’re going to either go forward with what was proposed or take away what was proposed. Everything is on hold as they get the new people in.”The export rules are among the regulations paused to give the new administration time to review “questions of fact, law, and policy,” according to a presidential memorandum issued Jan. 20.“If the administration wants to go even further than the regulations published in October to reduce the regulatory burden, I think the industry would welcome that,” Hardwick said.In general, industry executives expect the new administration to facilitate exports, noting the National Space Policy published in 2020 during Trump’s first term said it was the policy of the U.S. to “encourage the export of space- items when doing so would not threaten the national interest.”“We’ll see space as more of a trade issue in this administration because it will help countries offset any trade imbalances that we have,” O’Connell said.Surviving disruptionSpace industry executives and companies have varying views on regulatory changes, export controls and proposed tariffs in large part because they mean something different to each one.“Different companies will have different risk exposure,” said S. Sita Sonty, partner and managing director for aerospace, defense and aviation at consulting firm Alix Partners. “If their supply chain has either more resilience or greater risk, that’s going to determine that company’s respective position about tariffs or foreign investment from a particular country.”And companies have a role to play in policy discussions.“We have to be diligent in watching and, where appropriate, engaging in the shaping of upcoming policies and regulations for the space industry,” Lewis said. “We all have a voice right now and we have to look for opportunities to advocate for the policies that drive a robust space sector.”This article first appeared in the March 2025 issue of SpaceNews Magazine.