The draft European Union (EU) Space Act has already generated significant debate. First proposed by the European Commission in June 2025 and now moving through negotiation, including a compromise text circulated at the end of March, the measure is a landmark regional effort to bring greater coherence to a fragmented set of national rules governing space activities across the EU. Broadly aiming to help improve the competitiveness of European space providers, it seeks to create a more predictable single, regional market for space activities.

But the EU process is only part of the story. As the European framework evolves, Member States are also developing or updating national frameworks of their own. This creates a delicate balancing act now playing out in one of the most dynamic space markets in Europe: Spain.

Spain's space sector has recently been in the headlines. Increasing its average annual contribution to the European Space Agency (ESA) from €300 million to €455 million, Spain is now, for the first time, the agency's fourth-largest contributor. Spain's private space sector is also gaining prominence in European and international space discussions, thanks to both longstanding multinational players, such as Hispasat, as well as high-achieving NewSpace companies like PLD Space. Even NASA's latest exploration announcement has a Spanish connection: Málaga-born Carlos García-Galán was recently named the Program Executive for NASA's new Moon Base initiative.

Yet Spain bears watching just as much on the regulatory front. Spain has been working on a legal framework for space activities that addresses many of the same issues now being debated at the EU level, but in a way that seeks to cater to its growing national space sector.

According to Ana Marín, Head of Cabinet to the Director of the Spanish Space Agency (AEE), Spain's goal is to help the national space sector flourish while positioning itself as a reliable international partner. But there is a gap in the national normative framework. As she put it during remarks at the NewSpace & Solutions Conference in Seville last month, "it is very risky not to have that legal certainty." A 2023 royal decree directed the newly established space agency to propose a comprehensive national space law to bolster Spain's space governance.

According to Marín, the Spanish initiative has five related objectives:

• Provide legal certainty to domestic operators;
• Foster the Spanish space industry, with special attention to NewSpace actors while strengthening traditional industry players;
• Attract investment and talent;
• Protect national security and advance collective security; and
• Guarantee space sustainability.

Marín described progress on several implementation aspects, including an authorization regime for all space activities under Spain's jurisdiction. Of note, the initiative also proposes a dual-registration concept: one registry for space objects, consistent with the Registration Convention, and another for space activities, meant to better support oversight and transparency. She also discussed the future law's treatment of risk and financial exposure, including insurance and financial guarantees, as Spain seeks to balance its obligations under the Liability Convention with the need not to place undue burdens on companies.

There are still some open questions. These include what Marín described as "dual sustainability," that is, sustainability in space, through measures to protect the space environment, and sustainability on Earth, through attention to the terrestrial environmental effects of space activities. Concretely, this includes debris mitigation and disposal, but also adjacent concerns such as dark and quiet skies, which seeks to limit light pollution to protect ground-based astronomy.

These domestic priorities mirror some of the core issues being debated at the regional level. The EU Space Act's three pillars — safety, resilience, and sustainability — cover many of the same issues, at a broader level, increasing the risk that Spain gets too far ahead in areas that are likely to overlap, with real consequences. Because the EU Space Act is intended as a regulation, it would be directly applicable to Spanish operators once adopted. Spain's national law will therefore strive to avoid contradiction or unnecessary duplication even as it defines the authorization, supervision, registration, and institutional mechanisms through which both regional and national obligations are implemented. AEE's drafters are thus working to design a national framework that is compatible with the EU system while addressing Spanish priorities.

Further complicating matters, however, is timing.

Spanish officials have already had to adjust their process to align with the EU Space Act. Yet the EU text is not finished. The Commission's 2025 proposal has now been followed by a March 2026 Council compromise text under the Cypriot Presidency, and further institutional negotiation is expected before final adoption, likely no earlier than late 2028. This adds at least a year of potentially major shifts to Spain's timeline, which earlier pointed to a 2026–2027 enactment window.

This puts AEE in a critical position. On one hand, the additional time allows them to engage diverse stakeholders and refine its approach, increasing the likelihood that it gets the draft framework right. On the other, it prolongs the very uncertainty that the initiative seeks to address. Spain therefore should consider how to make enough progress to provide confidence to industry while maintaining flexibility to adapt to the EU process. That may involve a combination of technical legal precision, and a strategy that leverages more flexible governance tools in tandem, as well as sustained regional engagement and a clear understanding of where Spanish priorities should shape the European debate.

For Spanish companies, there is ongoing uncertainty in advance of two coming regulatory waves as both measures eventually take effect. Even if they are very well aligned, there is likely to be an adjustment period and resource investment to align internal processes to both sets of requirements. While the rules are being set, however, companies have the opportunity to leverage the opportunity to engage and deliver a consistent message to both governments in Spain and Europe about their concerns.

Finally, the implications of Spain's balancing act go beyond the continent. For Latin American space actors, this dynamic is a useful reminder that regional coordination does not eliminate the importance of national governance. Latin American governments and analysts have often looked to Europe as a model for regional space cooperation, including by comparing the recently established but struggling Latin American and Caribbean Space Agency (ALCE) to ESA. But Europe's current regulatory debate shows that even in a highly institutionalized regional environment, national legal frameworks remain essential.

Spain may offer a useful model: a country trying to move quickly enough to provide legal certainty, but carefully enough to remain aligned with a larger regional framework that is still evolving. This will continue to be a story worth watching from both a governance and business perspective — in Europe and beyond.