Not only would the proposal make it easier for companies to get this additional type of financing, but these loans would likely charge lower interest rates. Loans with lower rates give companies a better chance of succeeding in the expensive business of launching and operating satellites by lowering the total project cost.

The proposed agreement is a positive step for the space-transportation industry, said Michael Kelly, chairman and chief technical officer of Kelly Space & Technology, which is designing a reusable launch system.

"It opens to everyone [the type of financing that] someone like GE Capital already does and does so internationally," he said.

To be willing to make an asset-backed loan, lenders need to be able to seize the property in case of default on the loan. Because aerospace projects are often international, the laws of many countries can regulate their assets. This makes it difficult to seize hardware quickly so that the lender can liquidate the assets to get cash for a defaulted loan.

The agreement would take care of this impediment by setting international rules for seizure. These rules govern the seizure of hardware and associated rights such as access to the ground facilities and use of the licenses needed to operate it.

The Unidroit convention would also set up an international registry for space assets, possibly through the United Nations, according to Dara Panahy of the law firm of Milbank, Tweed, Hadley and McCloy. Milbank is spearheading the Space Working Group, an alliance of commercial space and financial companies providing feedback on the agreement. This registry would give lenders a place to check out a company’s assets, as well as other possible loans that may have rights to the same hardware in case of default.

Countries are still hashing out the final wording. One area of conflict involves whether the agreement should be limited to property in orbit or extended farther out to cover other regions of space, even out to the moon. Once the final wording is agreed upon, each participating country must ratify the document. Progress has been slow, however, and the financial community has not yet focused on the agreement, according to Peter Nesgos, a Milbank partner working in New York.

"I think anything that provides more information and more standardization of laws would be very helpful," said financial analyst Paul Nisbet of JSA Research in Newport, Rhode Island.