From Situational Awareness to Systemic Stability: A Phased Institutional Pathway for Space Traffic Management

Rapid growth in satellite deployments has transformed Earth orbit from a sparse operational environment into a continuously negotiated shared domain. Modern tracking networks increasingly detect conjunction risks, yet collision avoidance remains dependent on bilateral coordination between operators rather than predictable procedural rules. Space situational awareness (SSA) is therefore indispensable but incomplete: it provides probabilistic knowledge of orbital conditions but does not yet constitute a traffic management regime capable of ensuring consistent, system-level predictability. This paper examines how space traffic management (STM) can be developed by converting awareness into structured coordination through phased institutional design rather than immediate supranational authority. It distinguishes SSA from STM and identifies short-term improvements that establish interpretive interoperability without redistributing authority. To address scaling constraints, the paper introduces a cooperative Orbital Stability Assessment (OSA) producing a periodic Orbital Stability Index (OSI). As a pre-institutional diagnostic pilot involving civil safety service providers, commercial SSA analytics providers, and spacecraft operators, OSA would evaluate system-level coordination conditions by measuring coordination burden rather than incident occurrence, while OSI would synthesize those observations into a periodic assessment of whether coordination remains predictable and scalable as operational demands increase. The framework is diagnostic rather than regulatory and is intended to provide a shared empirical basis for subsequent governance and institutional decision-making. Building on the recommendations of the International Institute of Space Law (IISL) Working Group on the Legal Aspects of Artificial Intelligence in Space, the paper evaluates governance architectures and proposes a phased pathway toward a Space Traffic Management Authority (STMA). STMA is conceived as a centralized standard-setting institution without real-time operational control, supported by distributed implementation, market-based compliance incentives, and interoperability mechanisms. Drawing on the procedural model of the International Civil Aviation Organization (ICAO), it would define global operational expectations while implementation remains national and does not require immediate treaty formation. The governance pathway is explicitly phased: interoperability through Global Navigation Satellite Systems (GNSS)-type reference layers; convergence through processes analogous to the Joint Authorities for Rulemaking on Unmanned Systems (JARUS) and standards bodies such as the International Organization for Standardization (ISO); followed by the formation of STMA as a centralized institutional standard-setting body; then hybrid compliance reinforced through distributed regulatory and market mechanisms; and, once operational practices stabilize and verification mechanisms mature, selective consolidation analogous to the International Maritime Organization (IMO). The paper further examines implementation challenges associated with participation incentives, insurance-based compliance mechanisms, free-rider behavior, and geopolitical fragmentation, arguing that institutional success should be evaluated not solely by universal participation, but by the ability to facilitate predictable coordination across diverse governance architectures.