EU competitiveness ministers on 29 May 2026 debated the proposed EU Space Act, with the Cypriot presidency presenting a progress report that exposed persistent divisions on governance, the scope of dual-use activities, and the regulatory burden on small and medium-sized enterprises (SMEs). The Act aims to harmonise rules for space activities, enhance safety and sustainability, and boost competitiveness, but member states pulled in different directions on key design choices.
Commissioner Andrius Kubilius stressed the need for minimum harmonisation of governance to enable mutual recognition and equal technical requirements for dual-use satellites. Germany called for a proportionate, risk-based framework that respects existing national standards. Poland emphasised support for SMEs and security safeguards. France insisted on respecting member states' national security prerogatives and a level playing field with third-country operators. Denmark advocated broad application of requirements with exemptions only for clear defence use, and flexible governance with member states in the lead. Italy warned against centralisation, excessive burden on SMEs, and called for international standards and a clear equivalence regime for third countries.
The debate revealed a cleavage between member states favouring strong EU-level harmonisation (Denmark, supported by the Commission) and those prioritising national security discretion and lighter-touch rules (France, Italy, Germany). A second cleavage pitted larger spacefaring nations against those concerned about SME competitiveness: Italy and Poland warned that overly prescriptive rules could stifle smaller operators, while Denmark argued for broad application with narrow defence exemptions.
The Act's final shape will directly affect EU space operators (large and small), national space agencies, third-country operators seeking access to the EU market, and EU institutions responsible for oversight. A centralised governance model could reduce administrative duplication for operators active in multiple member states but may increase compliance costs for SMEs. A more flexible, national-led approach would preserve member state sovereignty and reduce SME burden but could fragment the single market for space services. The Council took note of the progress report; technical work will continue under the Irish presidency, with a view to reaching political agreement in 2027.