As long as the satellite is behaving itself, it can fly over any country and will not be subject to any laws from that country. The Outer Space Treaty was set up in part to clarify issues like this (also to keep nukes out of space). The US has no authority to restrict operations of an overhead satellite- which is good, because then they could prevent satellites orbiting in some of the most valuable inclinations. The only instances that I know of where a country did anything about an overhead satellite was China, when they blinded a satellite with a laser from the ground and when they tested an anti-satellite missile on one of their own satellites.
It's still a categorical "not" as far as international law goes. There are no competing treaties that other countries have signed with different interpretations of the fair use of space. Just because China (and the US, as other replies have pointed out) has broken the rules doesn't change the fact that they are still the rules. A satellite that is behaving itself is one that isn't violating the OST- generally that means not interfering with other satellites and their missions and not carrying nuclear weapons.
62 miles (100 km) altitude is where the border lies.
This is not a gray area at all and there is no money to be made by violating the OST. If you start a company in a country that has signed the OST you will be held to the rules. Any country that isn't a signatory to the OST doesn't have a robust space program and will likely still require you to follow the OST because there will be strong international pressure on them. Even if a country did allow you to violate the OST you wouldn't have a viable business because all the economically developed countries of the world have signed the OST and won't do business with someone that is interfering with their access to space.
Laws and treaties aren't magic. Countries break them all the time and often get away with it.
China wasn't really punished when it blew up a satellite, and I doubt that was allowed by the treaty.
The better question, though, is are there any MOTIVATION to break the treaty?
Well there certainly already was motivation for china, I there is certainly motivation for other countries to engage in weapons testing. Especially if they could do their weaponization without being noticed. I doubt that every rocket in the world is checked, top to bottom for weapons.
> 62 miles (100 km) altitude is where the border lies.
This is incorrect on several levels (which, of course, did not prevent you from downvoting my post):
* The Outer Space Treaty does not have a definition of the boundary. Here it is, go ahead, look it up: http://www.unoosa.org/oosa/en/ourwork/spacelaw/treaties/oute.... It's hardly a "law" (technically, a treaty is not a law either), more of a set of guidelines and some more concrete restrictions to solve some Cold War issues.
* You are referring to the Kármán line (https://en.wikipedia.org/wiki/Kármán_line) which is commonly referred to as a boundary between the atmosphere and the outer space.
* On the other hand, the United States considers an "astronaut" anyone who has flown over 50 miles (80 km) above the surface.
You already see the discrepancy, don't you?
Most importantly though, both "boundaries" are merely working benchmarks, without any legal authority.
The actual boundaries are determined by national laws. I have no doubt that many, if not most national laws have no such boundaries defined at all. (Heck, if the US doesn't have a solid definition, then who does?)
Finally:
> It's still a categorical "not" as far as international law goes
What is that "international law"? Not the Outer Space Treaty, I presume? If you seriously believe that China openly violated a specific law, I'd be curious to know what law it was.
Generally speaking, "law" is an enforceable set of rules. The "international law" is, sans special cases like war crimes, a misnomer.
Even if we look at something more mundane and reachable like maritime borders, which are more or less firmly defined, they've been disputed a bajillion times (for example, Spratly Islands) or simply ignored or "freely interpreted" (Russia's Arctic exploration).
The context is about the vertical extent of the national borders, not the edge of space.
Who says the vertical border ends with the edge of space? Once again, the vertical extent is not defined. Say, tomorrow they come up with a Skylon-like contraption that will be used in civil aviation. That would give a reason to the national governments to redefine the notion of "airspace".
> Anything orbiting multiple times is in space, and nobody will argue.
And how do you know that? Once again, with the example of China, nobody could come up with counterarguments precisely because it's undefined.
