The crazy history of the space OTRAG company and space law aspects

For this new space law article, let us have a look at the space OTRAG company and space law aspects. “Faster, better, cheaper!” This is the slogan since Herman Oberth declared in his book A Rocket into Planetary Space: under certain economic conditions, the construction of such machines (rockets) may even become profitable. Such conditions might arise within a few decades (1923). Some forty years later, space was given a legal framework at the instigation of the United Nations, which then came to regulate its exploitation and use.

In the first half of the 20th Century, Germany had a head start in the space race, in particular with the creation of the V2 missile, which required the main devices used by modern launchers for its operation. At the end of the Second World War, notably because of disarmament combined with the arms ban imposed on Germany by the Allies, German projects were abandoned. A few years later, at the height of the Cold War, it was the Russians and Americans who took over in this unbridled race against time. The two great world powers also worked to recover German rocket knowledge by hiring hundreds of German engineers to work on their projects alongside the famous Wernher von Braun.

It is in the context of The Cold War, punctuated by an inter-state “race for space conquest” that the O.T.R.A.G. company was born in Stuttgart (i.e. Orbital Transport und Raketen-Aktiengesellschaft).The gist of the project planned by its founder, Lutz Kayser, an emeritus German engineer, was to compete with the large public aerospace companies by creating the first private company to build modular space launchers, according to principles that are unusual in space: systematically adopting the most rustic and cheapest solution.

This huge project financed by more than six hundred European investors, including by the German Federal Republic, from the get-go, was born in 1975. It should be recalled that a few decades later, the willingness to explore space at highly reduced costs was taken over by the pharaonic SpaceX project designed by the ambitious Elon Musk.

Concerning the OTRAG project and after several months of negotiations, mostly in Africa, a contract was finally drafted and signed on March 26, 1976, with Zaïre, to establish a launch center in northern Shaba, a Zambia bordering region. “Negotiations lasted fifteen to twenty minutes”, recalls Frederic Weymar, the businessman who put the German company in touch with the Zairean authorities. More than thirty-eight square miles of land in Africa were dedicated to the project (i.e. one tenth of the entire Zairean territory and more than twice the size of Switzerland), the launch site being located on a high plateau overlooking the Lubua River, a tributary of the Congo, at an altitude of one and a half kilometer.

This contract took the shape of an international commitment, mainly meaning that it couldn’t benefit from the binding traction of a ratified treaty. It does, however, provide a framework for cooperation relations between Zaire and the OTRAG. On one hand, the OTRAG agreed to ensure Zaïre’s development (but also agreed to pay an annual rent for the right to occupy the land), and on the other hand, Zaïre agreed to leave a field of operations, as wide as possible, available for the launching of OTRAG rockets.

Originally, the contract was concluded for a period of twenty years – although we shall see that the project was put on hold much earlier – and as such, compensation clauses in the event of termination by either party had been inserted. If OTRAG happened to be at the origin of the cancellation of the contract, it would’ve had the obligation to return the territory in its original state. However, if the cancellation came from the Zaire side, such cancellation would entail compensation based on the value of the installations set up by OTRAG (under the supervision of experts appointed by mutual agreement between the two parties).

Even if the international dimension is not eye catching or noticeable at first glance, the 1967 Space Treaty – to which Zaire is one of the signatory states – strongly influenced the law of the parties. Indeed, as a reminder, when a treaty is signed by a State, it acquires a greater scope than its national law.

Firstly, Article VI of this Treaty provides that the activities of non-governmental entities in space must be subject to authorization and continuous monitoring by the State concerned. It is therefore understood here that Zaire had at the time of signing the contract implicitly – or not – accepted this monitoring responsibility.

Moreover, the 1967 Treaty requires a principle of peaceful use of the territory. This principle is to be found in Article I §2 of the said contract, but it was extended by the parties because it provides that “the right of enjoyment includes the right to enjoy the territory (…) for the purpose of sending spacecraft into space for peaceful uses (…) and of all measures which, in the opinion of the OTRAG, are directly, indirectly or otherwise related thereto”. However, even though the contract provides a legal framework for the exercise of rights over the territory by OTRAG, a certain limit was imposed on the German company in the sense that its activities were not allowed to jeopardize the country’s security. Such limitation enabled Zaire to retain a firm grasp on its sovereignty over its territory and thus to break slightly from the 1967 Treaty of which it is only a signatory.

Regarding the law applicable to the contract, we mentioned the fact that it wasn’t really an international treaty. It’s reasonable to assume that is more of an economic development agreement. In fact, the aim sought by director Mobutu – apart from the notoriety that the project offered him – was to develop the Zairian infrastructures thanks to the varied activities of the German company.

Diving deeper in the legal field, if a clause happened to refer to the Zairean national law, as mentioned earlier, such a link did not prevent any kind of interference by an international jurisdiction. Indeed, beyond the influence of the Space Treaty on the contract, the activities carried out by OTRAG were linked to outer space and therefore had effects on third countries.

Thus, in his Note sur le contrat du 20 octobre 1978 entre le Zaire et l’OTRAG, Gundolf FAHL (a jurist) referred to the example of OTRAG placing a satellite in orbit over a third State. Indeed, this situation could affect Zaire’s relations with this third State, even in compliance with the principle of the peaceful use of space. Therefore would engage Zaire’s responsibility even though it is an OTRAG satellite.

As a result, the main element that jumps out would be that trying to decipher the law applicable to the contract at first sight was a far cry due to the complexity of the whole scheme, complexity reinforced by the various clauses inserted in the contract (exemption clauses, waiver clauses, etc.) and the various international players involved including third States that could be affected by OTRAG’s activities.

In this manner, after promising, in exchange of all the rights he gained thanks to the contract that both parties agreed to, telecommunications satellites (including “surveillance”) to the Zairian leader, the engineer expatriated his team to the heights of a plateau in the middle of the Savannah.

In Olivier Schehm’s documentary Fly Rocket Fly, we can see young engineers in shorts building huts with green roofs, hunting gazelle by helicopter or sharing local cannabis with tame monkeys. It is in this atmosphere of lightness and rusticity (the first rocket launch tower will be built in wood) that Lutz Kayser’s ambitions – necessarily limited by the shoestring budget he had – were starting to reach new heights.

As an example, the original investment of 400 million Deutsche Mark – devoted to the development of the program until 1981 – represented, at the time, only half of the costs devoted to the financing of the Ariane launcher produced by the ESA (European Space Agency). The low cost dimension of the project translated itself in the intrinsic manufacturing characteristics of the modules.

Consequently, as opposed to multi-stage rockets, an OTRAG rocket was a coaxial assembly of modules, each of which were composed of a tank and an engine, the assembly being six and a half meters long and thirty centimeters in diameter. The basic module of the OTRAG used to be ten meters high and eighty cm in diameter, and had a thrust of three tons. In addition to various elements borrowed from current industrial production, fuel oil and nitric acid were used as fuel (this mixture costed only one twentieth of the price of fuel used by traditional rockets).

In spite of these particular characteristics the first rocket was successfully launched on May 17, 1977, reaching an altitude of twenty kilometers. This noticeable victory, for what was at the time one of the youngest space program who ever lived, especially in the geopolitical context of the era, attracted the attention of several major foreign countries, in particular massive entities like the United States of America, the U.S.S.R. and France.

However, as early as 1978, during a debate in the French Senate, a considerable number of elements were uncovered suggesting that Germany was supposedly, inconspicuously, taking advantage of OTRAG’s expansion to manufacture satellite launchers for military uses (this subterfuge allowing Germany to circumvent the Allies’ decision, at the end of the Second World War, to demilitarize the German state and in an extension forbidding any activity related to the manufacturing of weapons).

In the archives of the Official Gazette of the French Republic, a question asked by Mr. Pierre Bernard-Reymond, Secretary of State to the Minister of Foreign Affairs, to Senator Boucheny can be found in this regard: “I have drawn your attention to information which states that a company called O. T. R. A. G. is allowing the Federal Republic of Germany to transgress Allied decisions prohibiting that country from manufacturing satellite launchers for military use”. In addition, the family relationship between Lutz Kayser and the managing director of Dornier, Germany’s leading arms company, was pointed out.

This theory would thus explain the curiosity of the geographical choice of the space program, Lutz Kayser being able to carry out his project, out of sight, in the Zairean mountains. Frank Wukasch, an engineer friend and associate of Lutz Kayser’s, explained in retrospect with lucidity that “If the choice of Zaire was a logical one, diplomatically, it was going to be catastrophic”.

This contract between the state of Zaïre and the OTRAG was signed about ten years after the entry into force of the Outer Space Treaty (1967), which was written and negotiated between the parties to avoid arsenalisation and appropriation of space. It is in the context of the Cold war and of the race to the Moon that space law has emerged on the international scene. While it is noteworthy that this law is still a vague law that deserves to be strengthened, some fundamental principles governed space law at the time when OTRAG concluded the contract with Zaïre. One may cite the main ones to explain the legal context in which the contract was concluded and to point out whether this contract complied with international space law.

Article 1 of the 1967 Outer Space Treaty provides the freedom of appropriation and use of space for all states in the interest of all countries. Another fundamental principle is enshrined in the international treaty: the principle of non-appropriation of space (Article 2). It means that the outer space, including the moon and other celestial bodies shall not be appropriated by any states. No state may assert its sovereignty or occupy outer space. These general rules are accompanied by other principles that should be raised within the framework of this article. Article 6 of the above-mentioned Treaty reads as follows: “State parties to the treaty should bear international responsibility for national activities in outer space, including the Moon and other celestial bodies, whether such activities are carried on by governmental agencies or non-governmental entities”. This implies that private entities should require authorizations and permanent supervision from the State party to the Treaty. Finally, this Treaty limits above all the use of the Moon and any other celestial body for non-warlike purposes.

These examples highlight the real willingness of the international community to regulate space law in the face of the acceleration of scientific research and experimentation in this field. However, these norms remain particularly general and Zaïre had not ratified the said Treaty, even though Zaïre implicitly committed itself to respecting the provisions of the Treaty, It must be recalled that, in international law, a treaty is legally binding as soon as the state has ratified the Treaty. Under this condition, the Treaty will have to be applied in the national law of the State Party.

One may therefore question the legality of such a project, set up in a country that is not subject to the provisions of the Treaty governing space activities. If it belongs to OTRAG to enjoy the territory on which the activities will be carried out, in accordance with the provisions of the Space Treaty, it seems nonetheless surprising, that a company may legally carry out activities in a State that has not committed itself to respecting the legal framework of these activities.

When reading Article 7 of the Outer Space Treaty, it is clearly stated that any State Party whose territory or facilities are used to launch an object is internationally liable for damage caused by the said object or its constituent parts, on Earth, in the atmosphere or in outer space. Thus, it would seem that Zaïre, the only signatory to the Treaty, could host such a project without ever being held responsible in the event of accidents.

As it has just been underlined, the optimism (or bullishness) surrounding the whole operation quickly faded away to leave room to a constellation of questions. Among them, the question of liability started to raise many eyebrows. To theorize it, or have a shot at it at least, authors tried bringing together two notions, almost at the opposite end of the spectrum, to unfold what needed to be unfolded.

As it has just been underlined, the optimism (or bullishness) surrounding the whole operation quickly faded away to leave room to a constellation of questions. Among them, the question of liability started to raise many eyebrows. To theorize it, or have a shot at it at least, authors tried bringing together two notions, almost at the opposite end of the spectrum, to unfold what needed to be unfolded.

In his book, Mr. Armel Kerrest, Professor emeritus of Public Law at the University of Western Brittany and President of the Association for the Development of Space Law in France, in his book named “Attachment to States of private activities in space. Reflection in the light of the law of the sea” asserted the idea that the notion of “launching State” currently constitutes a kind of “lock” which makes it possible to ensure a responsibility and thus a control of material activities in space.

This notion of “launching State”, in the present case, can be compared to the activities carried out by OTRAG, mainly in Zaire, which have raised the question, at least in the legal community, of the risk of occurrence of “flags of convenience” in space matters.

In maritime law, a flag of convenience is defined by the International Transport Federation as a vessel “for which the real ownership and control is in a country other than that of the flag under which it is registered” and this with the aim of generally escaping the regulations and taxation of the country of origin.

The theory transposed to the particular case of OTRAG’s activities would suggest that the relationship, enforced by the contract, between the very low quality of the consideration due by the OTRAG company in Zaire, characterized solely by the dispatch of an experimental surveillance satellite in the name of the host country, and the almost complete freedom that the company could enjoy in exchange, subject only to taking out insurance, would bring this situation even closer to a potential translation in space law of the notion of “flag of convenience”.

The comparison made to a notion related to maritime law would in fact be part of a more general reflection based on the potential affirmation, full and complete, of the status of “launching State” as a source of security, opposed to the link based on registration. Consequently, the States whose financial responsibility could be sought would be identifiable on the basis of purely factual criteria, notably that of territory, and would therefore not be able to invoke the existence of a distended link between the company operating the launches and the territory at the origin of these launches in order to request a potential irresponsibility.

However, the perpetuation of the status of “launching State” as a solution to the consequences of the multiplication of projects trying to replicate what OTRAG did and, more generally, the question of the use of the law, strictly speaking, as a palliative to the potential failures linked to this type of operations, also knows its detractors.

The latter thus highlight the fact that the issue is in fact a prerogative of international relations, the question being articulated, for the States hosting these operations, around the need to maintain some kind of credibility by reinforcing the norms of control of these operations, in an international context tending towards generalized transparency and potentially disastrous economic consequences in the event of failures.

Whether the answer is legal or other, the accelerated democratization of these operations in the years to come, in a context of exponential growth in the conquest of space, risks complicating the problem. Consequently amplifying the need for a clear and determined response on the subject. The reign of taking a rain check on this issue is closer to the finish line than ever.

Caught between the fires of Moscow and Washington, Lutz Kayser’s project, wearing the burden of the political instability in Zaire – the battle of Kolwezi led by soldiers of the (FNLC), from Angola and supported by Cuba and even East Germany will take place only a few kilometers from the OTRAG base. Some sources will claim that the capture of Kolwezi was only an intermediate objective, the main one being the capture of the OTRAG base – will end in disaster.

Despite a second launch synonymous with a second success – on 20 May 1978 a rocket reached an altitude of 30 km – the project will not survive the third launch. On 5 June 1978, a rocket launched from the Zairean base of OTRAG finally crashed, before the stunned eyes of Mobutu, who had come to attend the event in person, accompanied by his general staff, which had become a Soviet-style ceremony. The OTRAG project becoming a thorn in the side of the African head of state – put under pressure by Leonid Brezhnev, his neighbors and the costs involved – will thus be nipped in the bud. The contract will be broken in 1979, just over 4 years after its signature. Following the Zairean failure, the project found a home in Libya, 600 km from Tripoli, before settling in Sweden in Tir Kiruna. Each time, international pressure will push the leaders of OTRAG to leave the countries in question and abandon their plans for space conquest. The company eventually ceased its activities completely and disappeared in 1987.

For his part, Lutz Kayser, forced to retire from the company’s management in 1981, chose to draw a definitive line under his dreams of space and even refused in 2015 a request from Saudi Arabia to build a launch site in the middle of the desert.

Shortly before his death – and many years too late – he declared himself a recluse on an island in the Pacific, as if not to be confronted with his failure: “What is ambivalent about rockets is that they can be used for civilian as well as military purposes”.

Lucid.

This article was written by Cloé DANIEL, Mikhael TORRES, Yannis KHENNANE, Léa DETURCHE, M’hamed BENNOUNA and Jean-Pierre MENDY (Paris-Saclay).