Picture yourself launching a venture aimed at mining minerals from asteroids. The early days are challenging. Returns are uncertain, and even if profits emerge, they likely won’t appear for five years—perhaps a full decade. Securing backing is slow because several similar ventures collapsed and the investment horizon is too long for many financiers. Yet you endure, and you manage to win over a handful of investors.
You recruit astronomers to pinpoint asteroids rich in metals, such as platinum. Unmanned probes are dispatched to multiple near‑Earth objects to gather samples. The initial finds prove mediocre in value. The costs prove steeper than the potential rewards.
Then there is a breakthrough: you identify a viable target and manage to bring platinum‑group metals back to Earth. Soon afterward, a coalition of nations sues you. They are all parties to the so‑called Moon Agreement of 1979, formally titled the “Agreement Governing the Activities of States in the Moon and other Celestial Bodies,” which took effect in 1984. The treaty covers not only the Moon but all celestial bodies, including asteroids.
Several of these states are now demanding a hefty slice of your profits for individuals who have never participated in asteroid mining—many of whom cannot even define what an asteroid is, and certainly not how to launch a rocket. They invoke Article IV, Paragraph 1, and Article XI, Paragraphs 1 and 3, of the Moon Agreement, which declare: “The exploration and use of the Moon shall be the province of all mankind and shall be carried out for the benefit and in the interest of all countries, irrespective of their degree of economic and scientific development. Due regard shall be paid to the interests of present and future generations as well as to the need to promote higher standards of living and conditions of economic and social progress and development in accordance with the Charter of the United Nations.” So much for Article IV.
Article XI states: “The Moon and its natural resources are the common heritage of mankind. Neither the surface nor the subsurface of the Moon, nor any part thereof or natural resources in place, shall become property of any State, international intergovernmental or non-governmental organization, national organization or non-governmental entity or of any natural person.”
The Moon Agreement, signed by 22 countries and ratified by 18, was designed to function in a manner similar to seabed law, and a delegate from Sri Lanka encapsulated the idea in plain language: “If you touch the nodules [the seabed’s valuable mineral deposits], you touch my property. If you take them away, you take away my property.”
The plaintiffs now press for their “rightful share” of your profits, arguing that the platinum belongs not to you, but to humanity as a whole—and especially to developing nations, many of which are not yet involved in space exploration. If they prevail, you and any other company would be unable to attract investors again. Asteroid mining would be rendered untenable from the outset.
Mars Without Property Rights
To be sure, investors can be reassured that a lawsuit anchored to a treaty signed by a relatively small group of countries is unlikely to succeed. But consider a second thought experiment:
It is 2075. The first Martian settlements are thriving, housing several thousand people alongside a multitude of robotic workers. The settlers are constructing underground homes, dome habitats, a hospital, and other essential facilities. Yet a fundamental issue remains: unlike Earth, Mars lacks private property rights. Attempts to establish private ownership and even a digital land registry have repeatedly been halted by legal scholars. This time the obstacle is not the 1984 Moon Agreement but the 1967 Outer Space Treaty (OST), whose Article II proclaims: “Outer space, including the Moon and other celestial bodies is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means.”
Moreover, Article I asserts that the exploration and use of outer space “shall be carried out for the benefit and in the interest of all countries, irrespective of their degree of economic or scientific development, and shall be the province of all mankind.”
In this case, the argument about Moon Agreement having limited signatories cannot be used, since 117 countries are parties to the Outer Space Treaty—and another 22 have signed it.
The claimants maintain that Article II forbids not only national appropriation of celestial bodies but also any form of private ownership. They further contend that Article I should be read to require an equitable distribution of profits from extraterrestrial resources, a view that has at times surfaced in real‑world debates.
For the sake of argument, suppose their interpretation holds. If there are no property rights—nations cannot own land (though they might lease it), and private enterprises cannot either, since any form of appropriation by states or private individuals would be prohibited—could such a society even exist, let alone prosper economically? Naturally not.
Most prosperous nations recognize private land ownership. Where it is absent, many permit long‑term usage rights granted by the state for 50–99 years—often transferrable, as in Vietnam and China or Singapore for 99 years. North Korea is the only country that does not allow even that. Mars‑based property ownership under such a regime would resemble North Korea—an economy marked by scarcity and periodic famine. Could a Martian settlement flourish if its economic model mirrored North Korea’s?
The Legal Debate Over Private Ownership in Space
The central issue in deciding whether private property rights apply hinges on Article II of the OST. Legal scholars diverge on how to interpret it. The core dispute concerns whether the “prohibition of appropriation” binds only the states explicitly named in the treaty or also private individuals and corporations not referenced in Article II.
In Outer Space: Problems of Law and Policy, Glenn H. Reynolds and Robert P. Merges argue that: “Being prevented from claiming sovereignty and exclusive property rights located in the space environment for themselves, it will be argued that States are also prohibited from granting quasi-sovereign and exclusive property rights over such areas and resources to those natural and juridical persons which are subject to national jurisdiction and which are created through international agreements.”
Those who contend that private appropriation is off‑limits also claim that private ownership would infringe upon the freedoms of access, exploration, and use guaranteed to all states by Article I. If private property rights existed, space law expert Marcus Schladebach contends, it would impinge upon the freedoms afforded to all states and jeopardize outer space’s status as a “global commons” beyond territorial sovereignty. If national appropriation is barred, Schladebach maintains, private appropriation should be barred all the more.
By contrast, other jurists argue the opposite: sovereignty ends where outer space begins, which means national appropriation of the Moon, other planets, and asteroids is prohibited, but private ownership of celestial bodies could be permissible. This interpretation relies on the legal maxim expressio unius est exclusio alterius: the explicit mention of one element of a class signals that others in the same class are not covered by the same provision. If a rule or treaty names certain items, it is reasonable to conclude that others of the same class remain unrestricted by that rule.
Other scholars argue that while private individuals or companies might not be forbidden from claiming property, it would be unlawful for a country to recognize such a claim publicly. They elaborate: “‘To recognize’ means to ‘acknowledge the existence, validity, or legality of’ or ‘accept, acquiesce to, or decide not to contest.’ In contrast, ‘to confer’ means to ‘grant (a title, degree, benefit, or right).'”
They continue: “If a nation asserts the right to confer, grant, or vest title to lunar land, it could be running afoul of the ban on national appropriation. But if a settlement arises and the settlers claim private ownership around their area, and multiple Earth nations acknowledge that claim, it is not reasonable to claim that all those nations are attempting to appropriate the land and thus violating the Outer Space Treaty.”
Still others reason from various provisions of the OST that hold states liable if a privately launched rocket crashes in another country. Moreover, they argue, states are obligated to authorize and supervise the activities of private companies operating within their borders. From this, they conclude that, even in the absence of explicit language, the OST bars private appropriation.
Wasser and Jobes properly object: “But the treaty clearly does not contain any language explicitly saying that states may not authorize their citizens to do anything that they themselves cannot do, contrary to what some authors appear to assume. The treaty does not say that what is prohibited to states is therefore prohibited to private entities, nor that what is prohibited to the regulator is therefore always prohibited to the regulated. A baseball coach gives ‘authorization and continuing supervision’ to his players. Does the fact that the coach is not allowed to run onto the field to catch a fly ball mean the players he supervises cannot either?”
The wording of Article I of the Outer Space Treaty describes outer space as “the province of all mankind” and asserts that celestial bodies should be “free for exploration and use by all States without discrimination of any kind on basis of equality” and “there shall be free access to all areas of celestial bodies.” Critics claim this casts space as a public good owned by all and owned by nobody at once.
One point remains relatively uncontested: the OST contains ambiguities, notably about private property and private enterprises. These ambiguities trace back to the priorities of the United States and the Soviet Union when the OST was drafted. Their main aim was to prevent an arms race in space and the deployment of weapons of mass destruction there. The idea of private space companies—and business models enabling private asteroid mining—was a distant prospect in 1967. Consequently, private ownership was a secondary concern for both nations. The Soviet side would have preferred a ban on private companies in space during treaty negotiations, a proposal the United States rejected. So the language was kept deliberately vague, omitting contentious issues, which is why the interpretation remains challenging today.
How Nations Are Writing Their Own Rules
Over the years, several countries have sought to clarify the matters that remained murky. For instance, unlike Article II of the Outer Space Treaty, Article XI, paragraph 3 of the Moon Agreement explicitly prohibits private ownership in outer space.
The Moon Agreement—by not only banning private property but, in some readings, advocating for an egalitarian distribution of profits from private ventures—embodies a redistributive ethos. “At its heart,” observes space analyst Rand Simberg, “the Moon Treaty was redistributionist in nature, taking from those who were willing to take risk and invest capital in developing new resources and giving to those who did not.”
Most nations declined to sign the Moon Agreement, though for varied reasons. This raises a question that is rarely asked: if the Moon Agreement simply clarified and implemented the Outer Space Treaty as intended, why did 121 of the 139 states party to the OST refuse to sign on? The question is often overlooked.
What should be done when a treaty invites a plurality of interpretations? One path could be to renegotiate. In 1999, Ezra Reinstein argued that an amendment to the OST was needed to clarify and expand property rights in space. He insisted that it should be explicit that the phrase “for the benefit… of all countries” is a moral exhortation, not a loophole enabling the United Nations to dispossess a private party of their site. The call for clarification through amendment underscores the enduring vagueness and legal uncertainty embedded in the OST.
Yet another route has gained traction in recent years. The United States has pursued a different approach: when treaties exhibit divergent interpretations across nations, it increasingly falls to national legislators to interpret them. This trend gained momentum with the Commercial Space Launch Competitiveness Act, championed by Sen. Ted Cruz and then‑Sen. Marco Rubio and enacted in 2015. It granted U.S. citizens and firms the right “to possess, own, transport, use, and sell [any] asteroid resource or space resource obtained in accordance with applicable law, including the international obligations of the United States.”
In April 2020, President Donald Trump advanced the policy further by signing an “Executive Order on Encouraging International Support for the Recovery and Use of Space Resources,” explicitly rejecting the notion of space as a “global commons.” The Moon Agreement, which the U.S. had not signed, was explicitly dismissed.
That order was soon followed by NASA’s Artemis Accords, officially titled “Principles for Cooperation in the Civil Exploration and Use of the Moon, Mars, Comets and Asteroids for Peaceful Purposes.” A central element is the notion of “safety zones”— geographically defined regions around a station or activity on the Moon or another body. These zones are not meant to undermine territorial rights but to facilitate peaceful use and prevent near‑by conflicts. Section 10 of the Accords states: “The Signatories affirm that the extraction of space resources does not inherently constitute national appropriation under Article II of the Outer Space Treaty, and that contracts and other legal instruments relating to space resources should be consistent with that Treaty.”
Initially signed by eight countries—the United States, Australia, Canada, Italy, Japan, Luxembourg, the United Arab Emirates, and the United Kingdom—the list of signatories has since grown to 67. Russia and China have rejected the accords and criticized how they interpret the Outer Space Treaty, with China fearing U.S. attempts to claim sovereignty over lunar resources through the Artemis framework.
Even so, the Artemis language—suggesting that space mining does not inherently breach Article II—continues to inject ambiguity. Space law scholars Michael Byers and Aaron Boley note in their book Who Owns Outer Space?: “Is Space mining sometimes ‘national appropriation’ and sometimes not? Was Space mining originally not ‘national appropriation,’ but capable of becoming understood as ‘national appropriation’ as understandings and interests change? Can a term such as ‘national appropriation,’ which has no ‘ordinary meaning’ because it is not used outside the Outer Space Treaty, ‘inherently’ mean anything?”
Designing a Space Economy That Actually Works
What should be the aim? Without clearly defined private property rights, Mars colonization and the economic exploitation of asteroids and the Moon would be hampered. Who should claim land on Mars or the Moon first? Figures such as Dennis Hope have traded in lunar plots, offering claims without a robust legal basis. Space law scholar Virgiliu Pop has written Unreal Estate: The Men Who Sold the Moon, arguing that from the 1890s to today many individuals have proclaimed ownership of the Moon or other celestial bodies—and found buyers. He emphasizes that ownership cannot be acquired through mere claims lacking physical possession; “A mere claim is not tantamount with ownership… a claim does not equal ownership.”
Yet the allure of owning space real estate remains strong enough to sustain interest. Reports claim millions have bought from Hope, offering hope that real estate on the Moon or Mars could attract buyers when such plots become available, albeit at steep prices.
So, who ought to hold property rights in space? My stance is that those with the means to reach, develop, and utilize the land should be first in line. If SpaceX succeeds in landing on Mars and begins creating enduring settlements, initial land ownership should gravitate to SpaceX for a practicable parcel—perhaps roughly the size of Singapore. Mars’s surface covers vast areas, so SpaceX would control only a tiny fraction initially, enough to support multiple outposts without shutting others out.
SpaceX might finance its voyage and buildout by listing Martian land as a real estate investment trust (REIT). Market forces would determine valuation, and most investors would seek appreciation rather than residence. To encourage settlement and development, colonists could receive preferential stock grants as a “golden hello” after arriving on Mars and remaining for five years.
If Chinese travelers arrive first and stake a claim, those plots would likely remain under state ownership, with the expectation that long‑term hereditary rights—perhaps spanning 50–70 years—be offered as a customary practice in China. Yet care would be required: if a nation achieves dominance on Mars and proclaims the entire planet as its territory, this would contradict Article II of the OST. Article XVI indicates that the treaty can be terminated with one year’s notice, raising questions about possible confrontations or sanctions from the United States. In such a scenario, negotiating a new space treaty before a winner is declared would be prudent. Competition for premium Martian real estate—near water sources or accessible lava tubes—could mirror the Moon and likely unfold in similar fashion. The same logic could apply to the Moon.
Regarding asteroids, at least for smaller bodies, ownership could be allocated to those capable of mining and extracting resources such as water and platinum. The most plausible approach might be to list the entire asteroid as a REIT on a stock exchange, funding mining efforts and enabling dividends to shareholders as resources are harvested. Even before any profits materialize, such a market could emerge, enabling trading activity and investment.
All of this remains a thought experiment, but it signals the direction future arrangements might take. Whether these ideas are realistic or whether alternative models will prevail remains unknown today.
Why the Case for Space Socialism Doesn’t Work
One truth is undeniable: without clear legal certainty for investors, funding will stay scarce. Returning to the starting question: who would invest in asteroid mining if profits were promised to others who did not risk capital but merely sought to profit as free riders?
In their book A City on Mars, best‑selling authors Kelly and Zach Weinersmith cite the Moon Agreement as a model, describing it as creating a solar system that resembles a form of res communis—meaning “common heritage of mankind”—a commons owned collectively by humanity. If the Moon were under a CHM framework and you needed Moon water, you would have to compensate all of humanity somehow.”
They imagine a sprawling international planning authority to oversee how proceeds are distributed: “An international regime to oversee exploitation…a big entity established by states that were parties to the Moon Agreement looking over things, and in particular making sure developing nations got a fair cut.” This body would regulate where ventures could set up shop and how local resources could be used. It would not be agile; it would be slow, bureaucratic, and perhaps dull. There would be no space for private companies, no mechanism for market‑driven pricing, and no room for entrepreneurial ingenuity. In short, it would be space socialism, a plan destined to fail from the start.
On Earth, capitalism has proven successful, though in recent decades some socialist arrangements without private property persisted, albeit at the cost of widespread poverty, authoritarian governance, and famine. In the harsh environments of space, where the hurdles are far greater and living conditions far tougher, socialism would be ill‑fitted from the outset.
The central question—whether private property rights on celestial bodies can ever become a reality and whether Martian communities will favor capitalism or socialism—parallels the broader question of whether true colonization is even feasible. Even if Martian settlers initially faced prohibitions on property ownership and on market‑based systems, practical necessity would drive them toward private property. They would not operate in a vacuum of legal norms for long. And Earth’s governments would face a choice: confront the settlers with war or impose sanctions?
This article is adapted from New Space Capitalism: The Entrepreneurial Path to the Stars by permission of Skyhorse.
