International Institute of Space Law

Article

The Proposed Public Procurement for Projects to Enhance Industrial Capabilities through Japanese Lessons Learned

Keywords H-IIA, H3, Ariane 6, COTS, public private partnership, procurement
Authors Mizuki Tani-Hatakenaka
Author's information

358087 Mizuki Tani-Hatakenaka
Adv. LL.M Student of Air and Space Law, Law School, Leiden University, Steenschuur 25, Leiden, 2311 ES, the Netherlands, tani.mizuki@jaxa.jp.
  • Abstract

      This paper discusses a framework for governmental projects to enhance industrial capabilities through the lessons learned from the Japanese contractual practice of H3 launch vehicle, comparing with the NASA’s Commercial Orbit Transportation Service (COTS). In 1995, the research and development (R&D) of the H-IIA was started by a former body of JAXA, and each manufacturer was responsible for delivery as required. After twelve-times launches, the operation was privatized to Mitsubishi Heavy Industry, Ltd. (MHI). Concerning H3, MHI was selected as a R&D contractor and a launch provider. MHI established the H3 rocket system specification and responsible for delivering the first vehicle to JAXA in 2020, and JAXA is responsible for the total system including its launch base and the H3 flight demonstration. Such a framework gives MHI more creative freedom, but there can be a room for further clarification of the responsibilities. Coincidentally, such a framework between public and private entities is similar to that of the European new flagship launch vehicle, Ariane 6.
      Meanwhile in NASA’s COTS, partners are responsible for all of the development and operation but they are not required to deliver their vehicles to NASA, contrary to H3. It allows clear role allocation and companies’ maximum creativity. A series of contracts of the Commercial Resupply Services (CRS) after COTS is also remarkable to promote private investment, for example, around half of the total R&D cost is borne by private sectors. Also, cost accounting method does not seem to be applied for the price setting.
      The framework like H-2A is still necessary for high-risk R&D conducted by governmental agencies. It will be, however, necessary for projects, which aims at enhancing industrial capabilities through transferring the operations to the private sectors and encouraging innovation, to be taken different measures in relation to selection of prime contractor, delivery and payment in the development phase and to procurement of launch services in the operating phase.

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