# EUR-Lex - 52013PC0040 - EN

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# 52013PC0040

**Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EU) No 912/2010 setting up the European GNSS Agency /* COM/2013/040 final - 2013/0022 (COD) */**

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EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

Security requirements play an essential role in the design,
implementation and operation of the infrastructures emerging from the Galileo
and EGNOS programmes, whose use could affect the security of the Union and its
Member States. Due to their strategic aspect, satellite navigation systems are
sensitive infrastructures that could be susceptible to malicious use. Given the
increasing usage of satellite navigation across a great number of fields of
activity, an interruption in the supply of services could lead to significant
harm to modern society.

Regulation (EC) No 683/2008 of the European Parliament and of the
Council of 9 July 2008 on the further implementation of the European satellite
navigation programmes (EGNOS and Galileo)[1]
provides that the Commission should manage all aspects relating to security of
the two systems established under the Galileo and EGNOS programmes. However,
the security of the systems is itself subject to accreditation which consists
of verifying the compliance of the systems with the specified security
requirements and ensuring compliance with the relevant security rules
applicable to the Council and the Commission. As is the case for all
accreditation activities, security accreditation of the two European satellite
navigation systems must be carried out independently, particularly with regard
to all parties involved in their design, construction and operation.

The European GNSS agency is responsible for this accreditation
activity pursuant to the combined provisions of Regulation (EC) No 683/2008 and
Regulation (EU) No 912/2010 of the European Parliament and of the Council
setting up the European GNSS Agency, repealing Council Regulation (EC) No
1321/2004 on the establishment of structures for the management of the European
satellite radio navigation programmes and amending Regulation (EC) No 683/2008
of the European Parliament and of the Council[2].
The latter lays down the terms for implementing the accreditation task
entrusted to the Agency and specifies that security accreditation decisions
must be taken independently with regard to the Commission and the bodies
responsible for implementing the programmes. The obligation of independence
must also apply to the other tasks assigned to the Agency.

In order to ensure that the security accreditation activities are
performed in an independent manner, including, to a large extent, with regard
to the other activities of the European GNSS Agency, Regulation (EU) No
912/2010 provides the Agency with an independent body, the Security
Accreditation Board, which constitutes one of the three separate roles of the
Agency along with the Executive Director and the Administrative Board. The
Security Accreditation Board has equivalent status to the Administrative Board
and is solely responsible for accreditation decisions. These decisions are
nevertheless made on behalf of the Agency, in the same way as the decisions of
the Administrative Board, since the Agency alone has legal personality.

The European GNSS Agency's internal structural organisation is
unusual in as much as it separates the activities associated with system
security accreditation from the other activities, namely, security centre
management, contribution to the preparation for commercialisation of the
systems and any activities that the Commission might entrust to the Agency via
delegations.

On 30 November 2011 the Commission adopted a proposal for a
Regulation of the European Parliament and of the Council on the implementation
and exploitation of European satellite navigation systems[3]. This future GNSS Regulation
will replace Regulation (EC) No 683/2008 as of 1 January 2012 and
determine the governance framework during the 2014-2020 period. In particular,
it stipulates that most of the tasks associated with the operation of both the
Galileo and EGNOS systems will be entrusted to the European GNSS Agency. The
commitment expressed by the Commission in its proposal to delegating these
tasks to the Agency is shared by the European Parliament and the Council,
following discussions of the draft since the start of 2012. On 7 June
2012, the Council adopted a partial general approach (document 11105/12 of 11
June 2012) confirming this.

The question of the future of accreditation activities within the
Agency will determine whether the European GNSS Agency will manage the
exploitation of the two systems after 2013. In fact, for reasons associated
with the potential for conflicts of interest and the fact that one cannot be
both judge and interested party, the need for independence in security
accreditation decisions, does not appear to be easily reconciled with the fact
that such decisions are made within a body that is also responsible for
exploitation, even though, as has been explained above, Regulation (EU) No
912/2010 lays down terms for a degree of independence for the Security
Accreditation Board. In its proposal on the future GNSS regulation, the
Commission, being aware of this difficulty, also stipulated that security
accreditation of the systems would be one of the Agency's tasks 'until 30 June
2016 at the latest', at which time the exploitation activities would be in full
flow. The question of the future of the accreditation activities following this
date was therefore left open, which is to be the subject of a subsequent
proposal.

The Commission's approach regarding the date of 30 June 2016 was
widely supported when the draft was discussed by the members of the various
parliamentary committees. Within the Council, the Member States emphasised the
need to carry out accreditation activities independently and wanted the issue
of the future of system security accreditation after 1 January 2014 to be
settled as quickly as possible. Furthermore, on 7 June 2012, the Council
adopted a declaration (document 11279/12 ADD 1) in which it deemed that
accreditation activities should be performed in a strictly independent manner
with regard to the other tasks entrusted to the European GNSS Agency, that a
structural and effective division should be made within the Agency between its
various activities by 1 January 2014 at the latest, and that the
Chairperson of the Security Accreditation Board should be the only person in
the Agency responsible for accreditation activities. Accordingly, the Council
asked the Commission to submit such a proposal to amend Regulation (EU) No
912/2010 in good time.

It is important to resolve the issue of the future of the security
accreditation of the European satellite navigation systems during the future
financial framework 2014-2020. This means that Regulation (EU) No 912/2010 must
be amended.

Amending Regulation (EU) No 912/2010 also presents an opportunity to
incorporate changes in the text to bring it into line with the principles
contained in the common approach of the European Parliament, Council and
Commission on the decentralised agencies, as approved by the Commission on 12
June 2012.

Finally, the proposal on the abovementioned future GNSS Regulation
adopted by the Commission on 30 November 2011, which provides for the possibility
of extending the tasks of the European GNSS Agency and assignment of
operational tasks, significantly affects its staff requirements and, hence, has
consequences for its future budget. It is therefore important to amend the
legislative financial statement associated with Regulation (EU) No 912/2010.

2.           RESULTS OF CONSULTATIONS WITH THE
INTERESTED PARTIES AND IMPACT ASSESSMENTS

The Commission's proposal was not subject to an impact assessment
nor did it follow formal consultation of the parties concerned.

With regard to the amendments designed to align Regulation (EU) No
912/2010 with the principles of the interinstitutional approach to the
decentralised agencies, an impact assessment and formal consultation of the
parties concerned was not required because this approach was itself the result
of consultation between the Commission, the Council and the European
Parliament.

With regard to the amendments concerning security accreditation of
the European satellite navigation systems, it is important to note that the
Member States, which are closely involved in all security-related matters, are
in this case, the main, or in fact only, parties concerned other than the
institutions of the Union and the European GNSS Agency. The Member States were
widely consulted on this point during discussions on the future GNSS Regulation
within the Council, which made its position known in the abovementioned
declaration of 7 June 2012. In addition, the arrangements finally adopted
were the focal point of extensive discussions with the European GNSS Agency.
The European Parliament has received the proposal for the future European GNSS
Regulation but has not yet issued a specific opinion on the matter.

In addition, the various solutions that could theoretically be
envisaged for system security accreditation after 2013 have been assessed.
There are six potential solutions.

1) Entrusting accreditation to the private sector:

Accreditation of European satellite navigation system security
directly affects the security of the Union and its Member States, which want to
be closely involved in the accreditation work and decisions. Consequently,
entrusting accreditation to the private sector is not a serious option.

2) Creating a new regulatory agency for accreditation:

Creating a regulatory agency for accreditation of the security of
the European GNSS systems might seem to be a good idea but clashes with the
Union institutions' shared commitment over the last few years not to create any
new regulatory agencies. In addition, this solution would have a significant
cost, disproportionate to actual requirements. In fact, the permanent staff
responsible for system security accreditation accounts for approximately ten
people.

3) Entrusting accreditation to another existing regulatory agency:

An alternative solution to creating a new agency would be to entrust
security accreditation to another existing regulatory agency. Among the various
agencies of the Union, only the European Aviation Safety Agency (EASA) and, to
a lesser extent, the European Defence Agency appear, in principle, capable of
providing security accreditation of complex systems such as Galileo and EGNOS.

It should, however, be noted that such an accreditation task does
not fall within the scope of the current tasks of these agencies. In addition,
with regard to the EASA which should eventually be responsible for EGNOS
certification, there is a serious risk of conflict of interests between this
future certification role and any potential security accreditation task. With
regard to the European Defence Agency which is principally concerned with the
promotion of cooperation between Member States in matters relating to arms and
the defence industries, entrusting it with the security accreditation of
Galileo and EGNOS might appear to contradict the assertion that both systems
are civil systems under civil control.

4) Entrusting
accreditation to the Commission:

In 2007, during the preparatory work for the drafting of Regulation
(EC) No 638/2008 reforming the governance of the programmes, it was planned to
entrust the security accreditation of the two European satellite navigation
systems to the Commission. This solution was abandoned at the time because it
appeared that it could not be reconciled with the obligation of independence,
with the Commission managing 'all questions relating to the security of the
systems' under the terms of that Regulation. The same difficulty continues to
apply today since the future GNSS Regulation which is intended to replace
Regulation (EC) No 638/2008 from 1 January 2014 also provides for the
Commission to ensure the security of the programmes, including system security.
Furthermore, the Member States are very attached to the structure of the
Accreditation Board as it currently exists within the European GNSS Agency and
it would be difficult, on an administrative level, to incorporate such a body
in the Commission departments.

5) Entrusting accreditation to the Council:

There are several advantages associated with entrusting the security
accreditation of European GNSS systems to the Council. First and foremost, the
Council is not involved in the management of the programmes and its
independence would not be called into question. It has a degree of expertise in
accreditation of complex systems since it has already approved around fifty
systems for its own needs. In addition, it is the body most able to assume
responsibility for the political consequences of accreditation-related
decisions, which could have significant repercussions on the progress of the
programmes in terms of costs and schedules. Finally, the Member States, which
want to be very closely associated with the accreditation process, are
naturally much better represented in the Council than in any other Union body.

The disadvantages involved in implementing this solution, however,
outweigh the advantages. In fact, the Council is not a managing authority and
although it effectively has experience in accrediting a number of systems, up
to now these have been Council internal systems only designed to ensure its
smooth running. Furthermore, transferring and incorporating the structure made
up of the Administrative Board and its subordinate components as they currently
stand with staff including permanent officials into the administration of the
General Secretariat of the Council would present the same administrative
difficulties as a transfer to the Commission.

6) Reinforcing
the separation of activities within the European GNSS Agency:

This involves modifying the internal organisation of the Agency so
that there can be no further doubt concerning the independence of the
accreditation activities vis-à-vis the other activities carried out by
the Agency.

This solution, which means further separating the activities of the
European GNSS Agency and reinforcing the independence of the two different
bodies under a single legal and institutional roof, can provide the right
degree of independence in the exercise of accreditation activities and is
ultimately the solution that is least onerous, simplest and easiest to implement.
Moreover, it was recommended by the Council in its declaration of 7 June
2012.

3.           LEGAL ELEMENTS OF THE PROPOSAL

With regard to the need to ensure that activities associated with
accreditation of the systems are carried out independently and hence to reinforce
the separation of these activities and the other activities of the European
GNSS Agency, the proposal provides mainly for an increase in the powers of the
Security Accreditation Board and those of the Chairperson of the Security
Accreditation Board, by partly aligning them with those of the Administrative
Board and the Executive Director respectively.

It is also provided that the Security Accreditation Board must
prepare and approve the part of the Agency work programmes describing the
operational activities associated with system security accreditation as well as
the part of the annual report concerning the activities and prospects of the
Agency concerning systems' security accreditation activities and forward them
in due course to the Administrative Board so that they can be incorporated in
the Agency's work programme and annual report. It must also exercise
disciplinary authority over its Chairperson.

The Chairperson of the Security Accreditation Board plays a role in
relation to security accreditation activities comparable to that of the
Executive Director in other Agency activities. In addition to representing the
Agency, a function which is already laid down in Regulation (EU) No 912/2010 in
its current version, he/she will henceforth manage the security accreditation
activities under the direction of the Security Accreditation Board and ensure
the implementation of the part of the Agency work programmes associated with
accreditation. At the invitation of the Parliament or the Council, he/she may
also submit a report on the performance of its tasks and make a statement
before these institutions.

As regards the implementation of the interinstitutional approach to
the decentralised agencies, the alignment with the principles set out in this
approach notably affects the rules for adopting decisions by the Administrative
Board, the mandate of the members of the Administrative Board and the Security
Accreditation Board as well as those of their Chairpersons, the existence of a
multiannual work programme, the powers of the Administrative Board concerning
staff management, evaluation and revision of the Regulation, prevention of
conflicts of interest and processing of non-classified sensitive information.

4.           BUDGETARY IMPLICATIONS

The legal elements of the proposal referred to in point 3 above do
not in themselves have any budgetary implications.

However, the legislative financial statement associated with
Regulation (EU) No 912/2010, which accompanies the proposal and incorporates
the new staff requirements of the Agency relating to the new tasks which may be
entrusted to it, such as the exploitation of the European GNSS systems,
translates these requirements in financial terms. In budgetary terms, the
amounts required are already included in the Commission's proposal for the next
financial framework 2014-2020. They will be financed by redeployment within the
budget headings of the GNSS programmes in the same way as the additional
requirements for 2013. It should be noted that the expenditure associated with
the new staff requirements of the Agency will be partially offset by a
reduction of 30 posts in the Commission's establishment plan during the same
period, i.e. from 2014 to 2020. The budget details are shown in the legislative
financial statement in Annex.

It should be noted in any event that the figures referred to in the
legislative financial statement are dependent on the adoption of the financial
framework 2014-2020 by the budgetary authority and the adoption of the future
GNSS Regulation.

2013/0022 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL

amending Regulation (EU) No 912/2010
setting up the European GNSS Agency

THE EUROPEAN PARLIAMENT AND THE
COUNCIL,

Having regard to the Treaty on the
functioning of the European Union and in particular, Article 172 thereof,

Having regard to the proposal from the
European Commission,

After forwarding of the draft legislative
act to the national Parliaments,

Having regard to the opinion of the
European Economic and Social Committee[4],

Having regard to the opinion of the
Committee of the Regions[5],

Acting in accordance with the ordinary
legislative procedure,

Whereas:

(1)       It follows from the
combined provisions of Article 16 of Regulation (EC) No 683/2008 of the
European Parliament and of the Council of 9 July 2008 on the further
implementation of the European satellite navigation programmes (EGNOS and
Galileo)[6]
and Article 2 of Regulation (EU) No 912/2010 of the European Parliament and of
the Council setting up the European GNSS Agency, repealing Council Regulation
(EC) No 1321/2004 on the establishment of structures for the management of the
European satellite radio navigation programmes and amending Regulation (EC) No
683/2008 of the European Parliament and of the Council[7] that the European GNSS Agency
(hereinafter the 'Agency') must ensure the security accreditation of the
European satellite navigation systems (the 'systems') and, to this end,
initiate and monitor the implementation of security procedures and perform
security audits.

(2)       The provisions of
Regulation (EU) no 912/2010, in particular those in Chapter III of the
Regulation, expressly lay down the terms under which the Agency must perform
its task concerning security accreditation of the systems. In particular, they
stipulate, in principle, that security accreditation decisions must be taken
independently of the Commission and the bodies responsible for implementing the
European satellite navigation programmes (hereinafter the 'programmes') and
that the systems' security accreditation authority shall be a independent body
within the Agency that makes decisions independently.

(3)       In accordance with this
principle, Regulation (EU) No 912/2010 establishes the Security Accreditation
Board for European GNSS systems (hereinafter the 'Security Accreditation
Board') which, alongside the Administrative Board and the Executive Director,
is one of the three bodies of the Agency. This body performs the tasks
entrusted to the Agency concerning security accreditation and is authorised to
make security accreditation decisions on behalf of the Agency. It must adopt
its rules of procedure and appoint its chairperson.

(4)       Regulation (EU) No
xxx/2013 of the European Parliament and of the Council on the implementation
and exploitation of European satellite navigation systems[8], replacing Regulation (EC) No
683/2008, which will enter into force on 1 January 2014, defines the public
governance arrangements for the programmes during 2014-2020. It extends the
tasks entrusted to the Agency and provides, in particular, for the Agency to
play a major role in the exploitation of the systems.

(5)       In this new context, it is
essential to ensure that the Security Accreditation Board is able to carry out
the task entrusted to it with complete independence, in particular vis-à-vis
the other bodies and activities of the Agency. It is therefore essential to
further separate, within the Agency itself, the activities associated with
accreditation from its other activities, such as management of the security
centre, contribution to the commercialisation of the systems and any activities
that the Commission might entrust to the Agency by way of delegation, in
particular those associated with exploitation of the systems. To this end, a
tangible and effective structural division should be set up within the Agency
between its various activities by 1 January 2014 at the latest.

(6)       In order to achieve this,
Regulation (EU) No 912/2010 must be amended in order to increase the
independence and powers of the Security Accreditation Board and its chairperson
and to align these largely with the Administrative Board and the Executive
Director of the Agency respectively, while providing for a cooperation
requirement between the various bodies of the Agency.

(7)       The Security Accreditation
Board and not the Administrative Board prepares and approves the part of the
Agency work programmes describing the operational activities associated with
security accreditation of the systems as well as the part of the annual report
concerning the activities and prospects of the Agency with regard to the
systems' security accreditation activities and submits them in good time to the
Administrative Board so that they can be incorporated in the Agency's work
programme and annual report. It must also exercise disciplinary authority over
its Chairperson.

(8)       It would be desirable to
assign a role in relation to security accreditation activities to the
Chairperson of the Security Accreditation Board comparable to that of the
Executive Director in other Agency activities. Therefore, in addition to the
function of representing the Agency, already provided for under Regulation (EU)
No 912/2010 in its draft of 22 September 2010, the Chairperson of the
Security Accreditation Board should manage the security accreditation
activities under the direction of the Security Accreditation Board and ensure
the implementation of the part of the Agency work programmes associated with
accreditation. At the request of the Parliament or the Council, it should also
submit a report on the performance of its tasks and make a declaration before
these institutions.

(9)       In addition, in the
interests of preserving the independence of the Security Accreditation Board
and avoiding any conflicts of interest, it would also be useful for the Security
Accreditation Board and the Agency staff under its control to carry out their
work in a location ensuring their autonomy and independence with regard to the
Agency's other activities, in particular vis-à-vis the operational
activities associated with the exploitation of the systems and for the Agency's
internal rules on staff to ensure the autonomy and independence of the staff
performing the security accreditation activities vis-à-vis staff
carrying out other Agency activities.

(10)     Furthermore, given the
involvement of a number of third countries in the European GNSS programmes,
including in security matters, express provision should be made for
representatives of third countries to be able to participate under conditions
to be specified in the work of the Security Accreditation Board.

(11)     Regulation (EU) No 912/2010
must be made consistent with the principles contained in the shared approach of
the Parliament, Council and Commission to the decentralised agencies, adopted
by the three institutions on 5 July, 26 June and 12 June 2012
respectively, particularly with regard to the rules for adopting decisions of
the Administrative Board, the terms of office of the members of the
Administrative Board and Security Accreditation Board and those of their chairpersons,
the existence of a multiannual work programme, the powers of the Administrative
Board concerning staff management, assessment and revision of the Regulation,
prevention of conflicts of interest and handling of non-classified sensitive
information.

(12)     The financial interests of
the Union must be protected using proportionate measures throughout the
expenditure cycle, in particular, by means of prevention and detection of
irregularities, carrying out surveys, recovering lost, unduly paid or poorly
administered funds and, if necessary, applying penalties.

(13)     Finally, given that Article
[8] of Regulation (EU) No xxx/2013 (future GNSS Regulation) allows the Member
States to contribute extra funds in order to finance certain programme
features, the Agency should be permitted to award joint contracts with the
Member States when appropriate for performance of its tasks.

(14)     Regulation (EU)
No 912/2010 should be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

Regulation (EU) No 912/2010 is amended
as follows:

(1)
Article 3 is replaced by the following:

'Article 3

Bodies

1.           The bodies of the Agency
shall be:

a)
the Administrative Board;

b)
the Executive Director;

c)
the Security Accreditation Board for European
GNSS systems.

2.           The bodies of the Agency shall
accomplish their tasks, as specified in Articles 6, 8 and 11 respectively, in
accordance with the guidelines issued by the Commission as set out in Article
16 of Regulation (EC) No 683/2008.

3.           The Administrative Board
and the Executive Director on one hand, and the European GNSS System Security
Accreditation Board and its Chairperson on the other hand, shall cooperate to
ensure the operation of the Agency in accordance with the procedures determined
by the Agency's internal rules, such as the rules of procedure of the
Administrative Board, the rules of procedure of the Security Accreditation
Board, the financial rules applicable to the Agency, the implementing rules for
the status of staff and the rules governing access to documents.'

(2)
Article 4 is replaced by the following:

'Article 4

Legal status, local offices

1.           The Agency is a body of
the Union. It has legal personality.

2.           In each Member State, the
Agency shall enjoy the most extensive legal capacity accorded to legal persons
under national law. In particular, it may acquire or dispose of real and
personal property and be a party to legal proceedings.

3.           The Agency may decide to
set up local offices in the Member States, subject to their agreement, or in
third countries participating in the work of the Agency, pursuant to Article
23.

The provisions relating to the installation and
operation of the Agency in the Member States and host third countries and those
relating to advantages accorded by the latter to the Executive Director,
members of the Administrative Board, Agency staff and members of their families
are subject to specific arrangements made by the Agency with those Member
States and countries. The specific arrangements shall be approved by the
Administrative Board.

Member States and host third countries shall
provide an optimal framework for the Agency's activities, in particular as
regards:

a)       accessibility of the premises,

b)       the existence of suitable educational
infrastructures for the children of members of staff and seconded national experts,

c)       access to the employment market,
social security system and healthcare for the families of members of staff and
seconded national experts.

4.           The Agency shall be
represented by its Executive Director, subject to the provisions of Article
11a(1)(d).

(3)
Article 5 is amended as follows:

a)
paragraph 2 is replaced by the following:

'2. The Administrative Board shall be composed
of:

a)          one representative appointed by
each Member State;

b)         five representatives appointed by
the Commission;

c)          one non-voting representative
appointed by the European Parliament.

The duration of the term of office of the
Administrative Board members shall be four years and shall be renewable.

A representative of the Security Accreditation
Board of the European GNSS systems, a representative of the High Representative
for Foreign Affairs and Security Policy (the 'HR') and a representative of the
European Space Agency (the 'ESA') shall be invited to attend the meetings of
the Administrative Board as observers.'

b)
paragraph 4 is replaced by the following:

'4. The Administrative Board shall elect a
Chairperson and a Deputy Chairperson from among its members. The Deputy
Chairperson shall automatically take the place of the Chairperson when the
Chairperson is prevented from attending to his duties. The term of office of
the Chairperson and of the Deputy Chairperson shall be two years, renewable
once, and shall expire when they cease to be members of the Administrative
Board.'

c)
paragraph 6 is replaced by the following:

'6. Unless otherwise provided in this
Regulation, the Administrative Board shall take its decisions by an absolute
majority of its voting members.

A majority of two thirds of all voting members
is required for election of the Chairperson of the Administrative Board and the
Deputy Chairperson, and adoption of the budget and work programmes.'

(4)
Article 6 is replaced by the following:

'Article 6

Tasks of the Administrative Board

1.           The Administrative Board
shall ensure that the Agency carries out the work entrusted to it, under the conditions
set out in this Regulation, and shall take any necessary decision to this end,
without prejudice to the competences entrusted to the Security Accreditation
Board for the activities under Chapter III.

2.           The Administrative Board
shall also:

a)
adopt, by 30 June of the first year of the
multiannual financial framework provided for under Article 312 of the Treaty on
the Functioning of the European Union, the multiannual work programme of the
Agency for the period covered by the multiannual financial framework after
incorporating the section drafted by the Security Accreditation Board in
accordance with Article 11(3)(b) and after having received the Commission's
opinion;

b)
adopt, by 15 November each year at the
latest, the Agency work programme for the following year having incorporated
the section drafted by the Security Accreditation Body, in accordance with
Article 11(3)(c) and after having received the Commission's opinion;

c)
perform the budgetary functions laid down in
Article 13(5), (6), (10) and (11) and Article 14(5);

d)
oversee the operation of the Galileo security
centre (hereinafter the ‘Galileo Security Monitoring Centre’ or the ‘GSMC’) as
referred to in Article 16(a)(ii) of Regulation (EC) No 683/2008;

e)
adopt arrangements to implement Regulation (EC) No
1049/2001 of the European Parliament and of the Council of 30 May 2001
regarding public access to European Parliament, Council and Commission
documents(*), in accordance with Article 21;

f)
adopt the annual report on the activities and
prospects of the Agency, having incorporated the section drafted by the
Security Accreditation Board in accordance with Article 11(3)d) and forward it,
by 1 July, to the European Parliament, the Council, the Commission and the
Court of Auditors;

g)
ensure adequate follow-up to the findings and
recommendations stemming from the evaluations referred to in Article 26, as
well as those arising from the investigations conducted by the European
Anti-Fraud Office (OLAF) and all internal or external audit reports, and
forward to the budgetary authority all information relevant to the outcome of
the evaluation procedures;

h)
be consulted by the Executive Director on the
delegation agreements made by the Commission and the Agency under Article
[15(1)(d)] of Regulation [future GNSS Regulation] before they are
signed;

i)
adopt its rules of procedure.

3.           With regard to the
Agency's staff, the Administrative Board shall exercise the powers conferred by
the Staff Regulations of Officials of the European Union on the appointing
authority and by the Conditions of Employment of other servants on the authority empowered to conclude employment
contracts  ('the appointing authority powers').

The Administrative Board shall adopt, in
accordance with the procedure provided for in Article 110 of the Staff Regulations,
a decision based on Article 2(1) of the Staff Regulations and on Article 6 of
the Conditions of Employment of other servants delegating the relevant
appointing authority powers to the Executive Director and defining the
conditions under which this delegation of powers can be suspended. The
Executive Director shall be authorised to sub-delegate these powers.

In application of the previous subparagraph, where
exceptional circumstances so require, the Administrative Board may, by way of a
decision, temporarily suspend the delegation of the appointing authority powers
to the Executive Director and those sub-delegated by the latter and exercise
them itself or delegate them to one of its members or to a staff member other
than the Executive Director.

However, by way of derogation from the second
paragraph, the Administrative Board shall be required to delegate to the
Chairperson of the Security Accreditation Board the powers referred to in the
first subparagraph with regard to recruitment, assessment and recategorising of
staff involved in the activities covered in Chapter III and the disciplinary
measures to be taken with regard to the abovementioned staff.

The Administrative Board shall adopt the
implementing measures of the Staff Regulations of Officials of the Union and
the Conditions of Employment of other servants in accordance with the procedure
laid down in Article 110 of the Staff Regulations. It shall first consult the Security
Accreditation Board and duly take into account its observations with regard to
recruitment, assessment, reclassification of the staff involved in the
activities under Chapter III and the relevant disciplinary measures to be taken.

It shall also adopt the measures concerning the
secondment of the seconded national experts referred to in Article 15c, after
consulting the Security Accreditation Board and duly taking into account its
observations.

4.           The Administrative Board
shall appoint the Executive Director and may extend or end his term of office
pursuant to Article 15c(4). It shall exercise disciplinary authority over
the Executive Director.

_________________

(*)     OJ L 145, 31.5.2001, p. 43. »

(5)
Article 7 is replaced by the following;

'Article 7

Executive
Director

The Agency shall be managed by its
Executive Director, who shall carry out his/her duties under the supervision of
the Administrative Board, without prejudice to the powers granted to the
Security Accreditation Board and the Chairperson of the Security Accreditation
Board in Article in Articles 11 and 11a respectively.'

(6)
Article 8 is amended as follows:

'Article 8

Tasks of the
Executive Director

The Executive Director shall carry out
the following tasks:

(1)
he/she shall be responsible for representing the
Agency, except in respect of activities and decisions undertaken in accordance
with Chapters II and III, and shall be in charge of its management; he/she
shall sign the delegation agreements made by the Commission and the Agency
under Article [15(1)(d)] of the Regulation [future GNSS Regulation];

(2)
he/she shall prepare the work of the
Administrative Board and participate, without having the right to vote, in the
work of the Administrative Board;

(3)
he/she shall be responsible for implementing the
annual work programmes of the Agency under the control of the Administrative
Board, with the exception of the part of the programmes covered in Chapter III;

(4)
he/she shall take all necessary measures,
including the adoption of internal administrative instructions and the
publication of notices, to ensure the functioning of the Agency in accordance
with this Regulation;

(5)
he/she shall draw up a draft statement of the
Agency’s estimated revenue and expenditure in accordance with Article 13, and
implement the budget in accordance with Article 14;

(6)
he/she shall prepare a draft general report each
year, duly taking into account the comments of the Chairperson of the Security
Accreditation Board concerning the activities covered in Chapter III, and
submit it to the Administrative Board;

(7)
he/she shall ensure that the Agency, as the
operator of the GSMC, is able to respond to instructions provided under Joint
Action 2004/552/CFSP;

(8)
he/she shall define the organisational structure
of the Agency and submit it for approval to the Administrative Board;

(9)
he/she shall exercise, with regard to the
Agency's staff, the powers referred to in the first subparagraph of Article
6(3), to the extent that these powers shall be delegated to him in accordance
with the second subparagraph of the same paragraph;

(10)
he/she shall adopt, after approval by the
Administrative Board, the necessary measures to establish local offices in
Member States in accordance with Article 4;

(11)
he/she shall ensure that the secretariat and all
the resources necessary for proper functioning are provided to the Security
Accreditation Board and to the bodies referred to in Article 11(11);

(12)
he/she shall prepare an action plan for
monitoring the findings and recommendations of the assessments made and submit
a twice-yearly progress report to the Commission;

(13)
he/she take the following measures to protect
the financial interests of the Union:

i) he/she shall take preventive measures
against fraud, corruption or any other illegal activity and shall make use of
effective supervisory measures;

ii) he /she shall recover sums unduly paid
where irregularities are detected and, where appropriate, apply effective,
proportionate and dissuasive administrative and financial penalties;

(14)
he/she shall draw up an anti-fraud strategy for
the Agency and submit it to the Administrative Board for approval.'

(7)
the following Article 8a is inserted:

'Article 8a

Work programmes
and annual report

1.           The multiannual programme
of the Agency, referred to in Article 6(2)(a) lays down the actions that the
Agency must perform during the period covered by the multiannual financial
framework provided for in Article 312 of the Treaty on the functioning of the
European Union, including actions associated with international relations and
the communication for which it is responsible. This programme shall determine
the human and financial resources assigned to each activity. It shall take into
account the assessments referred to in Article 26.

2.           Based on the multiannual
work programme, the annual work programme referred to in Article 6(2)(b) lays
down the actions that the Agency must perform during the coming year, including
actions associated with international relations and the communication for which
it is responsible. This programme shall determine the human and financial
resources assigned to each activity. For information purposes, it shall include
the tasks that the Commission has delegated, as required, to the Agency
pursuant to Article [15(1)(d)] of the Regulation (future GNSS Regulation).

3.           The annual general report
referred to in Article 8(f) shall record the implementation of the Agency work
programmes.'

(8)
Article 10(g) is replaced by the following:

'g) the European GNSS system security
accreditation authority shall be, within the Agency, an autonomous body that
takes its decisions in a strictly independent manner, including with regard to
the Commission and other bodies responsible for the implementation of the
programmes, as well as with regard to the Executive Director and the
Administrative Board of the Agency;'

(9)
Article 11 is amended as follows:

a)
paragraph 3 is replaced by the following:

'3. The Security Accreditation Board shall:

a)       perform security accreditation of the
systems consisting of verifying compliance of the systems with the security
requirements referred to in Article 13 of Regulation (EC) No 683/2008 and
compliance with the relevant security rules and regulations applicable to the
Council and the Commission.

b)      prepare and approve the part of the
multiannual work programme referred to in Article 8a(1) concerning the
operational activities covered in this chapter and the financial and human
resources needed to accomplish them, and submit it to the Administrative Board
in good time so that it can be incorporated in the abovementioned multiannual
work programme;

c)       prepare and approve the part of the
annual work programme referred to in Article 8a(2) concerning the operational
activities covered in this chapter and the financial and human resources needed
to accomplish them, and submit it to the Administrative Board in good time so
that it can be incorporated in the abovementioned annual work programme;

d)      prepare and approve the part of the
annual report referred to in Article 6(2)(f) concerning the Agency's
activities and prospects covered in this chapter and the financial and human
resources needed to accomplish them, and submit it to the Administrative Board
in good time so that it can be incorporated in the abovementioned report;

e)       exercise disciplinary authority over
its Chairperson.

f)       adopt its rules of procedure;'

b)
paragraphs 7 and 8 are replaced by the
following:

'7. The Security Accreditation Board shall be
composed of one representative per Member State, a Commission representative
and an HR representative. The term of office of the members of the Security
Accreditation Board shall be four years and shall be renewable. A representative
of ESA shall be invited to attend the meetings of the Security Accreditation
Board as an observer. Where appropriate, the participation of representatives
of third countries and the conditions thereof shall be established in the
arrangements referred to in Article 23.

8. The Security Accreditation Board shall elect
a Chairperson and Deputy Chairperson from among its members by a two-thirds
majority of all members with the right to vote. The Deputy Chairperson shall
automatically take the place of the Chairperson where the Chairperson is
prevented from attending to his duties.

The Security Accreditation Board shall have the
power to dismiss the Chairperson and the Deputy Chairperson. It shall adopt the
decision to dismiss by a two-thirds majority.

The term of office of the Chairperson and of
the Deputy Chairperson of the Security Accreditation Board shall be two years,
renewable once. The term shall end when the Chairperson or Deputy Chairperson
ceases to be a member of the Security Accreditation Board.'

c)
paragraph 9 is deleted;

d)
paragraph 10 is replaced by the following:

'10. The Security Accreditation Board shall
have access to all the human and material resources required to provide
appropriate administrative support functions and to enable it, together with
the bodies referred to in paragraph 11, to perform its tasks independently, in
particular when handling files, initiating and monitoring the implementation of
security procedures and performing system security audits, preparing decisions
and organising its meetings. It shall also have access to any information
needed for the performance of its tasks in the possession of the Agency,
without prejudice to the principles of autonomy and independence referred to in
Article 10(g).'

e)
the following paragraph 17 shall be added:

'17. The Security Accreditation Board and the
Agency staff under its supervision shall perform their work in a manner
ensuring autonomy and independence in relation to the other activities of the
Agency, particularly operational activities associated with the exploitation of
the systems.'

(10)
the following Article 11a is inserted after
Article 11:

'Article 11a

Tasks of the
Chairperson of the Security Accreditation Board

1.           The Chairperson of the
Security Accreditation Board shall perform the following tasks:

a)       manage security accreditation
activities under the supervision of the Security Accreditation Board;

b)      ensure the implementation of part of
the Agency's work programmes covered in this Chapter under the supervision of
the Security Accreditation Board;

c)       cooperate with the Executive Director
to help to draw up the draft establishment plan referred to in Article 13(3);

d)      represent the Agency for the
activities and decisions covered in this chapter;

e)       exercise, with regard to the Agency's
staff involved in the activities concerned by this chapter, the powers referred
to in Article 6(3), first subparagraph, delegated to it in accordance with the
fourth subparagraph of the abovementioned paragraph.

2.           The Chairperson of the
Security Accreditation Board may be called upon by the European Parliament or
the Council to submit a report on the performance of his tasks, and to make a
statement before those institutions.'

(11)
Article 13 is amended as follows:

a)
paragraph 3 is replaced by the following:

'3. The Executive Director shall, in close
collaboration with the Chairperson of the Security Accreditation Board for
activities covered in Chapter III, draw up a draft estimate of expenditure and
revenue of the Agency for the next financial year and forward it to the
Administrative Board and the Security Accreditation Board, accompanied by a
draft establishment plan.'

b)
paragraph 5 is replaced by the following:

'5. Each year, the Administrative Board, based
on the draft estimate of expenditure and revenue and in close cooperation with
the Security Accreditation Board for activities covered in Chapter III, shall
draw up the estimate of the Agency's revenue and expenditure for the next
financial year.'

(12)
in Article 14, paragraph 10 is replaced by the
following:

The European Parliament, on a recommendation
from the Council acting on a qualified majority, shall, before 30 April of the
year N + 2, grant discharge to the Executive Director in respect of the
implementation of the budget for year N, with the exception of the part of the
budget implementation covering tasks which are, where appropriate, entrusted to
the Agency under Article [15(1)(d)] of the Regulation [future GNSS
regulation] to which shall apply the procedure referred to in Articles 164
and 165 of Regulation (EU, Euratom) No 966/2012 of the European Parliament and
of the Council of 25 October 2012 on the financial rules applicable to the
general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002.

_________________

(*)     OJ L 298, 26.10.12, p.1.'

(13)
after Chapter IV, the following Chapter IVa is
inserted:

‘CHAPTER IVa

HUMAN RESOURCES

Article 15a

Staff

1.           The Staff Regulations of
Officials of the Union, the Conditions of Employment of other servants and the
rules adopted jointly by the institutions of the Union for the purposes of the
application of those Staff Regulations and conditions of employment shall apply
to the staff employed by the Agency.

2.           The Agency's internal
rules, such as the rules of procedure of the Administrative Board, the rules of
procedure of the Security Accreditation Board, the financial rules applicable
to the Agency, the rules for the application of the staff regulations and the
rules for access to documents, shall ensure the autonomy and independence of
staff performing the security accreditation activities vis-à-vis staff
performing the other activities of the Agency, pursuant to Article 10(g).

Article 15b

Appointment and
Term of Office of the Executive Director

1.           The Executive Director
shall be recruited as a temporary member of staff of the Agency in accordance
with Article 2(a) of the Conditions of Employment of other servants.

2.           The Executive Director
shall be appointed by the Administrative Board on the grounds of merit and
documented administrative and managerial skills, as well as relevant competence
and experience, from a list of candidates proposed by the Commission, after an
open and transparent competition, following publication a call for expressions
of interest in the Official Journal of the European Union and elsewhere.

The Chairperson of the Administrative Board
shall represent the Agency for the purpose of concluding the Executive
Director's contract.

The Administrative Board shall take its
decision to appoint the Executive Director by a two-thirds majority of its
members.

3.           The term of office of the
Executive Director shall be five years. At the end of this term of office, the
Commission shall carry out an assessment taking into account the Executive
Director's performance and the future tasks and challenges of the Agency.

Based on a Commission proposal taking into
account the assessment referred to in the first subparagraph, the
Administrative Board may extend the term of office of the Executive Director
once for a period of up to five years.

The decision to extend the term of office of
the Executive Director shall be adopted by a two-thirds majority of members of
the Administrative Board.

An Executive Director whose term of office has
been extended may not take part in a selection procedure for the same post
following the extension of the term of office.

4.           The Administrative Board
may dismiss the Executive Director, on the basis of a Commission proposal, by
means of a decision adopted by a two-thirds majority of its members.

5.           The European Parliament or
the Council may call upon the Executive Director to submit a report on the
performance of his tasks, and to make a statement before those institutions.

Articles 15c

Seconded national
experts

The Agency may also use national experts. .
These experts shall have appropriate security clearances.'

(14)
Article 16 is amended as follows:

'Article 16

Fraud
prevention

1.           In order to combat fraud,
corruption and other unlawful activities, the provisions of Regulation (EC) No
1073/1999 of the European Parliament and of the Council (*) shall apply without
restriction. To this end, the Agency shall accede to the Interinstitutional
Agreement of 25 May 1999 between the European Parliament, the Council and the
Commission of the European Communities concerning internal investigations by
the European Anti-Fraud Office (OLAF) (**) and shall issue the appropriate
provisions to the staff of the Agency and to seconded national experts using
the model decision in the Annex to the abovementioned Agreement.

2.           The Court of Auditors
shall have the authority to supervise beneficiaries of the Agency's funding as
well as contractors and sub-contractors who have received Union funds via the
Agency, on the basis of documents provided to it or on-the-spot checks.

3.           With regard to grants
financed or contracts awarded by the Agency, OLAF may carry out investigations,
including on-the-spot checks and inspections in accordance with Regulation (EC)
No 1073/1999 and Council Regulation (EURATOM, EC) No 2185/96 (***), in
order to combat fraud, corruption and any other illegal activity detrimental to
the Union's financial interests.

4.           Without prejudice to
paragraphs 1, 2 and 3 of this Article, the cooperation agreements concluded by
the Agency with non-member countries or international organisations, contracts
and grant agreements concluded by the Agency with third parties, and any
financing decision taken by the Agency shall provide expressly that the Court
of Auditors and OLAF may carry out checks and investigations in accordance with
their respective powers.

_________________

(*)     OJ L 136, 31.05.99, p. 1.

(**)   OJ L 136, 31.05.99, p. 15.

(***) OJ L 292, 15.11.96, p.2.'

(15)
Article 17 is replaced by the following:

'Article 17

Privileges and
immunities

The Protocol (No 7) on the Privileges
and Immunities of the European Union shall apply to the Agency and to its
staff.'

(16)
Article 18 is deleted;

(17)
Article 22 is replaced by the following:

'Article 22

Security rules
on the protection of classified or sensitive information

The Agency shall apply the Commission's
security rules regarding the protection of EU classified information, laid down
in the Annex to Commission Decision 2001/844/EC, ECSC, Euratom of 29 November
2001 amending its internal Rules of Procedure (*). It shall also apply them to non-classified
sensitive information. This shall cover, inter alia, provisions for the
exchange, handling and storage of this information.

_________________

(*)     OJ L317, 3.12.2001, p.1.

(18)
the following Article 22a is inserted after
Article 22:

'Article 22a

Conflict of
interest

1.           The Executive Director, as
well as officials seconded by Member States and the Commission on a temporary
basis shall make a declaration of commitments and a declaration of interests
indicating the absence of any direct or indirect interests, which might be
considered prejudicial to their independence. These declarations shall be made
in writing on their entry into service and shall be renewed in the event of a
change in their personal circumstances.

2.           Before any meeting which
they are to attend, external experts participating in ad hoc working groups
shall declare the absence of any interest which might place their independence
in question in view of the items on the agenda.

3.           The Administrative Board
and the Security Accreditation Board shall implement a policy to avoid
conflicts of interest.'

(19)
the following Article 23a is inserted after
Article 23:

'Article 23a

Joint
procurement with the Member States

For the
performance of its tasks, the Agency shall be authorised to award contracts jointly
with the Member States in accordance with Commission Delegated Regulation (EU)
No 1268/2012 of 29 October 2012 on the rules of application of Regulation
(EU, Euratom) No 966/2012 of the European Parliament and of the Council on the
financial rules applicable to the general budget of the Union(*).

_________________

(*)     OJ L 362, 31.12.2012, p. 1.'

(20)
Article 26 is replaced by the following:

'Article 26

Evaluation and
revision of this Regulation

1.           By 2016 at the latest, and
every five years thereafter, the Commission shall arrange an evaluation of the
Agency, concerning, in particular, its impact, effectiveness, smooth running,
working methods, requirements and use of the resources entrusted to it. This
evaluation shall include, in particular, an assessment of any change in the
Agency's tasks and the financial impact of such a change.

2.           The Commission shall
submit the evaluation report and its conclusions with regard to the content of
this report to the European Parliament, the Council, the Administrative Board
and the Security Accreditation Board of the Agency. The results of the
evaluation shall be made available to the public.

3.           One evaluation in two
shall include an inspection of the Agency's balance sheet in terms of its
objectives and tasks. If the Commission considers that the continuation of the
Agency is no longer justified with regard to the objectives and tasks assigned
to it, the Commission may propose that this Regulation be repealed.'

Article 2

This Regulation shall enter into force on
the [twentieth] day following its publication in the Official Journal of the
European Union.

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament                       For
the Council

The President                                                 The
President

LEGISLATIVE FINANCIAL STATEMENT

1.           FRAMEWORK OF THE PROPOSAL/INITIATIVE

1.1.    Title of the proposal/initiative

1.2.    Policy
area(s) concerned in the ABM/ABB structure

1.3.    Nature
of the proposal/initiative

1.4.    Objective(s)

1.5.    Grounds
for the proposal/initiative

1.6.    Duration
and financial impact

1.7.    Management
method(s) envisaged

2.           MANAGEMENT MEASURES

2.1.    Monitoring
and reporting rules

2.2.    Management
and control system

2.3.    Measures
to prevent fraud and irregularities

3.           ESTIMATED FINANCIAL IMPACT OF THE
PROPOSAL/INITIATIVE

3.1.    Heading(s)
of the multiannual financial framework and expenditure budget line(s) affected

3.2.    Estimated
impact on expenditure

3.2.1. Summary of
estimated impact on expenditure

3.2.2. Estimated impact
on [body] appropriations

3.2.3. Estimated impact
on [the body's] human resources

3.2.4. Compatibility
with the current multiannual financial framework

3.2.5. Third-party
participation in financing

3.3.    Estimated impact on revenue

3.4.    Estimated impact on the
Commission's human resources

LEGISLATIVE FINANCIAL
STATEMENT

1.           FRAMEWORK OF THE PROPOSAL/INITIATIVE

1.1.        Title of the
proposal/initiative

Regulation of the European Parliament and of the Council amending
Regulation (EU) No 912/2010 of 22 September 2010 setting up the
European GNSS Agency – amendment of the financial statement.

1.2.        Policy area(s) concerned
in the ABM/ABB structure[9]

Policy Area(s) concerned: Enterprise and Industry

Chapter 02.05: SATELLITE
NAVIGATION PROGRAMME – GALILEO AND EGNOS

1.3.        Nature of the
proposal/initiative

 ̈ The
proposal/initiative relates to a new action

 ̈ The
proposal/initiative relates to a new action following a pilot
project/preparatory action[10]

 ̈ The
proposal/initiative relates to the extension of an existing action

þ (The
proposal/initiative relates to an action redirected towards a new action

1.4.        Objective(s)

1.4.1.     The Commission's
multiannual strategic objective(s) targeted by the proposal/initiative

To support the European presence in space and the development of
services relating to satellites

The satellite navigation programmes (hereinafter 'the programmes')
are flagship projects of the Union. They aim to provide navigation services and
will foster considerable developments in numerous sectors of activity, drive
technological innovation and growth of competitiveness in the European economy
and provide a source of job creation, commercial revenue and socio-economic
benefits. As such, they form part of the Europe 2020 strategy and policies for
sustainable development.

More specifically, the Galileo programme aims to establish Europe's
global navigation satellite system (hereafter GNSS). It will lead to the
provision of positioning, timing and navigation services to users worldwide for
a wide range of applications, from transport, financial securities clearance,
electricity provision, weather forecasting, to road tolling.

EGNOS is a European system developed to improve the performance of
the American GPS over the European area. It makes existing satellite navigation
services suitable for safety-critical applications such as flying and landing
aircraft or navigating ships through narrow channels in air or maritime
transport.

Based on the governance structure proposed by the Commission in its
proposal for a regulation on the implementation and exploitation of the
European satellite navigation programmes[11]
governance structure supported by the Council in its partial general approach
agreed on 7 June 2012 and by the European Parliament, the European GNSS Agency
(hereafter the "Agency") will become a major stakeholder in the
exploitation phase of the programmes.

Nevertheless, considering that the Regulation on the implementation
and exploitation of the European satellite navigation systems (hereafter
"GNSS Regulation") has not been adopted yet – it is currently under
discussion at the level of the Budgetary Authority – and is subject to the
final decision on the content of the next multiannual financial framework, some
of the hypotheses used to prepare the present legislative financial statement
are not definitive.

1.4.2.     Specific objective(s) and
ABM/ABB activity(ies) concerned

Considering this more active role of the Agency in the exploitation
phase of the programmes, the present proposal aims to reinforce the independence
of the Security Accreditation Board (one of the three bodies of the Agency) and
to provide the appropriate financial and human ressources to perform the tasks
allocated to the Agency.

1. Security accreditation:

Due to their strategic importance, the European satellite navigation
systems are critical infrastructures. They could be misused, threatening the
security of the Union and of Member States. Moreover, any interruption of their
services could lead to significant losses for the European economy as more and
more economic sectors are dependent on satellite navigation.

To guarantee the security of the systems, an independent security
accreditation needs to be performed and is crucial for the systems. Such
accreditation ensures that the security measures are adequate to defend the
system against threats and vulnerabilities, that the system itself does not
meet any unacceptable risk during its lifecycle and that the system itself can
process, store or forward sensitive or classified information without
unacceptable risks, according to specific conditions.

As the Agency will be more involved in the implementation of the
programmes under the new governance structure, the separation between
activities relating to security accreditation and the other activities of the
Agency needs to be reinforced to avoid conflict of interest between these
activities and safeguard the independence of security accreditation.

2. Market development and applications development:

The agency should contribute to the commercialisation of Galileo and
EGNOS services to foster their uptake. As regards commercialisation of
services, the latter is very important to maximise the socio-economic benefits
expected from the systems.

3. Operation of the Galileo Security Monitoring Centres and PRS
applications development:

The Agency will be responsible for the operations of the GSMC
(Galileo Security Monitoring Centre).

The GSMC is considered to be the 'brains' of the Galileo system as
regards overall security. It is a critical operational centre for the system.
It will be able to analyse and respond to threats or attacks. It will therefore
have to be operational prior to the Galileo services being up and running and
needs to be operated 24 hours per day, seven days per week by qualified experts.
It is based at two geographical sites located in Saint Germain en Laye in
France and Swanwick in the United Kingdom.

4. Exploitation of the systems:

The objective of the exploitation of the systems is to provide high
quality services to satisfy users' needs and to take all measures for their
widest and fastest adoption. An appropriate setting-up of the exploitation is
critical to ensure the long term running of the systems and the maximisation of
socio-economic benefits.

The governance shall be tailored to the different programmes
(Galileo and EGNOS) as they are at different stages of development and to the
phases of the programmes to avoid disruption. While EGNOS is already
operational and in its exploitation phase, Galileo will soon start a crucial step
in its development with the provision of services which will mark the beginning
of its exploitation phase.

With respect to EGNOS,

- its exploitation phase started in October 2009;

- the management of EGNOS exploitation is currently under the
responsibility of the Commission. The latter will be transferred to the Agency
on 1 January 2014, with a gradual phasing-in envisaged as from 2012
onwards;

- in the new governance framework (from 2014 onwards), the Agency
will manage all EGNOS exploitation-related activities from 2014 and will
outsource specific operational tasks to other entities, in particular the EGNOS
operator.

With respect to Galileo,

- different phases of the programme will overlap in the coming
years;

- during the on-going deployment phase of the programme, the current
set-up will remain in place to ensure continuity and consistency; the
Commission will remain responsible for the completion of the Galileo's
infrastructure;

- during the exploitation phase, which should start in 2014 with the
provision of initial services, the Agency will progressively manage
exploitation-related activities under a delegation agreement with the
Commission. The Agency will ensure the coordination of all the tasks relating
to the exploitation of the system such as maintenance, operations, service
provision and the implementation of future generation of systems, as well as
supporting the definition of system requirements for future systems by
providing feedback on changing operational needs and users' requirements. This
exploitation phase of Galileo constitutes a new programme phase and is subject
to a delegation of programme management from the Commission to the Agency.

To perform tasks relating to the exploitation of the systems, the
Agency will need to be sufficiently staffed. To ensure service continuity and a
smooth start of the exploitation phase of Galileo in 2014, it is also crucial
that the appropriate transition period is implemented prior to 2014.

Specific objective

To develop and provide infrastructure and services based on
satellite radio-navigation (Galileo)

ABM/ABB activities concerned

02 05 SATELLITE NAVIGATION PROGRAMME – GALILEO AND EGNOS

1.4.3.     Expected result(s) and
impact

Specify the effects
which the proposal/initiative should have on the beneficiaries/groups targeted.

The European satellite radio navigation programmes commenced more
than 10 years ago on the basis of a political vision to develop and operate a
global system that would allow the European Union to reap the economic and
strategic benefits thereof and provide satellite navigation services optimised
for civil use.

Galileo and EGNOS will bring significant socio-economic benefits to
the European Union due to:

i) direct benefits resulting from the growth of the downstream
GNSS-based market (receivers and applications). For example, if more planes are
equipped with GNSS receivers, additional revenues will be generated by the
manufacturers of these receivers;

ii) indirect benefits, outcome of the emergence of new applications.
If flight duration is reduced thanks to better navigation, planes will pollute
less and passengers will save precious time. Moreover, safer transport modes
and more efficient emergency services will allow more lives to be saved;

iii) direct benefits resulting from the growth of the upstream
market and technological spillover to other sectors. Investment directly made
into the GNSS upstream segment will benefit the industry. However, other
sectors will also take advantage of new developments in the space sector. For example,
instruments developed to evaluate and monitor the structural health of
launchers or fuel tanks can be used in automotive, construction, energy and
utility companies.

Although the system resulting from the Galileo programme will be
self-contained, the performance of its services will be enhanced thanks to its
interoperability with other systems such as the US GPS or Russia's GLONASS.
Hence cooperation with other countries providing satellite navigation services
will help maximise benefits for users, the public or the economy as a whole.

Managing the exploitation of the systems, as well as security
accreditation, the Agency will be the cornerstone of service provision. It will
also be a major stakeholder to foster downstream market development. As such, the
Agency performance will have a direct impact on the socio-economic benefits
expected from the systems.

1.4.4.     Indicators of results and
impact

Specify the
indicators for monitoring implementation of the proposal/initiative.

Indicators for monitoring the performance of the Agency will be set
based on the type of activity as follows:

1. Security accreditation:

The Agency needs to ensure the successful completion of the security
accreditation activities on time for each milestone of the Galileo programme (e.g.
to allow each launch of satellites). Its implementation will be evaluated based
on its contribution to the successful deployment of the infrastructure and on
the number of audit/security checks performed every year.

These checks consist of detailed technical examination by or for the
appropriate authority, or its nominated competent representatives, of the
security aspects of the system, of a cryptographic or a computer security
product. The evaluation confirms the presence of required security functionality
and makes an assessment of the incorruptibility of such functionality. The
evaluation determines the extent to which the security requirements of a system
are satisfied and establishes the assurance level of the system.

The number of checks depends on the progress made and on the
deployment of ground stations.

It is estimated that around 10 checks will be performed yearly
between 2013 and 2015, and 5 between 2016 and 2020.

2. Market development and applications development:

Activities relating to the performance of the Agency with regard to
the commercialisation of the services will be evaluated based on the market
uptake of the services provided be EGNOS and Galileo with specific indicators
to be developed by services once they become operational such as the number of
airports with EGNOS-based approach procedures, the number of tractors equipped
with EGNOS receivers and the estimated total socio-economic benefits from the
systems.

So far 82 airports have developed EGNOS-based approach procedures.
The aim is for 50% of all the appropriate relevant airports to have developed
EGNOS-based approach procedures by 2020.

3. Operation of the Galileo security monitoring centres and PRS
applications development:

These operations can be measured with an indicator of the number of
operational processes put in place. The aim is for a figure of 500 to be
reached in 2016. As the centres are not operational yet, no processes are in
place today.

4. Exploitation of the systems:

According to the proposal for a regulation on the implementation and
exploitation of the European satellite navigation systems, activities relating
to the exploitation of the systems will be based on a delegation agreement
between the Commission and the Agency. This delegation agreement will detail
the operational indicators for monitoring the implementation of these
activities as it is currently the case for EGNOS.

1.5.        Grounds for the
proposal/initiative

1.5.1.     Requirement(s) to be met in
the short or long term

In light of current figures on the development of the Agency, it is
not possible to carry out the new tasks included in the proposal for a
regulation on the implementation and exploitation of the European satellite
navigation systems, in particular with regard to their exploitation. The financial
statement should therefore be revised to adapt to the reality of the agency's
staffing needs.

Moreover, it should be noted that the implementation of the proposed
governance model requires the Agency to have appropriate technical and
operational staff with high level expertise in a very specialised area. The
organisational set-up of the Agency should also build on the specificities of
the activities to be performed.

Although the Agency will not perform all the activities internally
and will outsource a large number of tasks relating to service provision and
the development of major modifications and new generations of systems, it needs
to be staffed with the appropriate technical experts to manage necessary
procurement, control outsourced activities and prepare high quality reporting
to the Commission. Considering the complexity of the programmes, it is also
important to avoid intellectual hazard. Intellectual hazard could prevent the
appropriate acquisition, communication, process and implementation of
information crucial to the success of the operations and therefore poses a threat to the smooth, orderly, and
efficient functioning of the programmes.

The extra staff will be funded by a redeployment within the budget
headings of the GNSS programmes.

1.5.2.     Added value of EU
involvement

The EU right to act is based on article 172 of the Treaty on the
functioning of the European Union and the GNSS Regulation.

The systems established under the European satellite navigation
programmes are infrastructures set up as trans-European networks of which the
usage extends well beyond the national boundaries of the Member States.
Furthermore, the services offered through these systems contribute, in
particular, to the development of trans-European networks in the areas of
transport, telecommunications and energy infrastructures.

Satellite navigation systems cannot be set up by any single Member
States as this would exceed its financial and technical capacities. Therefore,
it can be only achieved by action at EU level.

1.5.3.     Lessons learned from
similar experiences in the past

Not relevant.

1.5.4.     Coherence and possible
synergy with other relevant instruments

Synergies are possible with other existing or future space
programmes, e.g. for the expansion of user segments (applications for the
downstream market).

Synergies shall also be sought within the other directorates of the
European Commission as regards research and innovation. Applications and
technologies using satellite navigation systems can impact various sectors of
the economy and of society such as transport, energy, location based services,
banking, agriculture, etc. It is important to ensure that research and
innovation programmes are coordinated by the Commission to maximise the
socio-economic benefits expected from the programmes in those sectors of
activities.

Furthermore, cooperation with the Joint Research Centre should be
strengthened. The programmes could benefit from its scientific and technical
expertise, as well as its state-of-the-art testing and measurement facilities
for activities relating to the security of the GNSS systems and the development
of GNSS-based applications.

1.6.        Duration and financial
impact

 ̈ Proposal/initiative of limited
duration

–
 ̈  Proposal/initiative in effect from [DD/MM]YYYY to [DD/MM]YYYY

–
 ̈  Financial impact from YYYY to YYYY

þ Proposal/initiative of unlimited
duration

–
Implementation with a start-up period from 2014
to 2016,

–
followed by full-scale operation.

1.7.        Management mode(s)
envisaged[12]

þ Centralised indirect management with the delegation of implementation tasks to:

–
 ̈  executive agencies

–
þ  bodies set up by the European Union[13]

–
 ̈  national public-sector bodies/bodies with public-service mission

–
 ̈  persons entrusted with the implementation of specific actions
pursuant to Title V of the Treaty on European Union and identified in the
relevant basic act within the meaning of Article 49 of the Financial Regulation

 ̈ Joint management with international organisations (to be specified)

If more than one
management mode is indicated, please provide details in the 'Comments' section.

Comments

The current
governance framework was established for Galileo's development and deployment
phase as well as EGNOS initial exploitation i.e. for the period 2008-2013. This
framework needs to be revised taking into consideration the fact that the
Galileo deployment phase will extend beyond 2013 and that a new phase of the
programme will start in 2014 with the provision of initial services. EGNOS
governance should also be defined as the system has entered its operational
phase. The GNSS Regulation, currently under discussion by the Council and the
European Parliament, aims to define this governance framework.

As already
mentioned in the GNSS Regulation proposal, a stable, long-term and sustainable
governance framework needs to be defined. It shall optimise and rationalise the
use of existing structures and ensure a gradual transition between the
deployment phase and the exploitation phase safeguarding continuity of
services.

2.           MANAGEMENT MEASURES

2.1.        Monitoring and reporting
rules

Specify frequency
and conditions.

For its core activities, the Agency will apply monitoring and
reporting rules defined in the Common Approach on decentralised agencies agreed
between the Commission, the European Parliament and the Council. The Agency
will therefore propose:

- a strategic framework (multiannual work programme) including main
actions, estimated budget and time-table necessary to meet its objectives at
the latest by 30 June 2014;

- an annual work programme translating the strategic framework into
detailed measures and indicators to be proposed at the latest by
15 November of the preceding year;

- an annual report evaluating the completion of the annual work
programme;

In addition, every five years the Agency's performance will be
evaluated according to its objectives and mission. Its legitimacy will also be
re-evaluated every ten years.

Beyond these standard measures, for tasks delegated to it by the
Commission, the Agency should ensure that all contracts and agreements
concluded in the framework of the Galileo and EGNOS programmes will provide for
supervision and financial control. Particular focus in all monitoring and
evaluation mechanisms should be on containing programmes' cost while delivering
the services on schedule.

In addition, the Commission, in exercising its powers of political
supervision over the Galileo and EGNOS programmes, will strengthen the
monitoring and evaluation mechanisms by requesting detailed annual management
plans and implementation reports as well as organising regular programme
progress meetings and carrying out financial and technological audits.

Finally, in the day-to-day management, the Agency will implement a
risk management mechanism and appropriate management tools to contain programmes'
cost based on better cost estimation, taking stock of previous experience and
actual system implementation.

2.2.        Management and control
system

2.2.1.     Risk(s) identified

The Agency will be responsible for activities crucial for the
systems, their security and their market uptake.

If it cannot have the appropriate organisational set-up and staff to
perform these activities the overall programmes will be at risk.

The major risks identified are the following:

• Market risks: market adoption of the services offered by the
European satellite navigation systems depend on two major factors: the quality
of the services offered and the readiness of the market to take on the new
services offered. Technical performance inferior to that promised or service
disruption will have a negative effect among users worldwide, and the
infrastructure will not be used as a result. Therefore it is crucial that the
exploitation of the systems is efficient. In addition, the availability of
reliable receivers must be ensured for all services to be offered by Galileo,
especially the Public Regulated Service and users awareness about the services
provided by Galileo and EGNOS must be raised to maximise market adoption and
hence the socio-economic benefits expected from the systems.

• Technological risks: satellite navigation uses leading-edge
technology which has yet to be validated and the specifications of which are
constantly evolving. Effective processes have to be put in place to ensure that
systems evolution and new generations are based on users' latest needs and most
high-performance technologies. The Agency needs to have the appropriate
resources to put it place these processes and provide the necessary information
to the Commission in order to determine the priorities as regards mission
evolution.

• Industrial risks: establishing the infrastructure involves many
industrial players, in a number of countries, whose work has to be coordinated
effectively in order to arrive at systems which are reliable and fully
integrated, particularly with regard to security. Lack of resources within the
Agency could lead to delays and cost overruns, if the programmes cannot be
coordinated effectively.

• Security risks: the Agency must see to it that the security of the
systems is safeguarded effectively to guarantee the security of the Union and
Member States.

• Governance risk: governance of the programmes requires various
bodies to work together, and an appropriate degree of stability and
organisation has to be guaranteed. The Agency will have a major role in the
exploitation of the programmes and as such, it represents a major governance
risk if it cannot operate efficiently.

2.2.2.     Control method(s) envisaged

The Agency’s accounts will be submitted for the approval of the
Court of Auditors, and subject to the discharge procedure. The Commission’s
Internal Audit Service will be the Agency's internal auditor. In addition, the
Agency is working towards quality and security certification of its key
processes as from 2014.

2.3.        Measures to prevent fraud
and irregularities

Specify existing or
envisaged prevention and protection measures.

The Agency is subject to monitoring by the Anti-Fraud Office.

3.           ESTIMATED FINANCIAL IMPACT OF THE
PROPOSAL/INITIATIVE

3.1.        Heading(s) of the
multiannual financial framework and expenditure budget line(s) affected

· Existing expenditure budget lines

In order of
multiannual financial framework headings and budget lines.

Heading of multiannual financial framework || Budget line || Type of expenditure || Participation

Number [Description.......................................] || Diff./non-diff. ([14]) || from EFTA countries[15] || from candidate countries[16] || from third countries || within the meaning of Article 18(1)(aa) of the Financial Regulation

1 || 02.0502.01 European GNSS Agency (GSA) – Titles 1 and 2 02.0502.02 European GNSS Agency (GSA) – Title 3 || Diff. || YES || NO || NO || NO

· New budget lines requested

In order of multiannual financial framework
headings and budget lines.

Heading of multiannual financial framework || Budget line || Type of expenditure || Participation

Number [Description........................................] || Diff./non-diff. || from EFTA countries || from candidate countries || from third countries || within the meaning of Article 18(1)(aa) of the Financial Regulation

|| No new budget headings requested. || || || || ||

3.2.        Estimated impact on
expenditure

Before going into the details of the
estimated impact of the present proposal, it is important to highlight that
this estimated impact is provisional at this stage as it is subject to the
adoption of the new Multiannual Financial Framework 2014-2020[17] by the Budgetary Authority.

Furthermore, some of the hypotheses used to
prepare the present legislative financial statement are not definitive. The
governance structure of the programmes and the subsequent missions of the
Agency are not defined in the present legislative proposal but in the GNSS
Regulation, which is currently under discussion by the European Parliament and
the Council. The need for more personnel is related to the new tasks allocated
to the Agency in the GNSS Regulation.

Therefore, the Commission reserves its
right to amend the present proposal if major changes occur in the governance or
in the financing of the programmes. Hence, if the Budgetary Authority decides
to drastically cut the budget allocated to the programmes, the tasks and the staff
allocated to the Agency will have to be re-assessed. Similarly, if the
Budgetary Authority decides to assign additional tasks to the Agency, staff
allocation will also need to be re-evaluated. For example, the draft report of
the European Parliament on the proposal for a regulation on the implementation
and exploitation of the European satellite navigation systems[18] (rapporteur: Marian-Jean
Marinescu] provides for the Agency to be responsible for the management of
centres of excellence to promote the development and uptake of GNSS
applications, on top of the other tasks assigned to it in the Commission's
proposal.

3.2.1.     Summary of estimated impact
on expenditure

EUR million (to 3 decimal places)

Heading of multiannual financial framework: || Number || Heading 1 – Smart and Inclusive Growth

[Body]: <.......> || || || 2013[19][20] || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || TOTAL 2014-2020

Budget heading 02.050201 European GNSS Agency (GSA) – Titles 1 and 2 || Commitments || (1) || 11.087[21] || 18.632 || 21.495 || 22.710 || 22.272 || 24.623 || 24.497 || 25.239 || 159.468

Payments || (2) || 11.087 || 18.632 || 21.495 || 22.710 || 22.272 || 24.623 || 24.497 || 25.239 || 159.468

Budget heading 02.0502 European GNSS Agency (GSA) – Title 3 || Commitments || (1a) || 2.363 || 6.550 || 6.150 || 6.100 || 6.150 || 6.800 || 6.800 || 6.300 || 44.85

Payments || (2a) || 2.363 || 6.550 || 6.150 || 6.100 || 6.150 || 6.800 || 6.800 || 6.300 || 44.85

|| || || || || || || || || || ||

|| || || || || || || || || || ||

TOTAL appropriations for GSA || Commitments || =1+1a -3a || 13.450 || 25.182 || 27.645 || 28.810 || 28.422 || 31.423 || 31.297 || 31.539 || 204.318

Payments || =2+2a -3b || 13.450 || 25.182 || 27.645 || 28.810 || 28.422 || 31.423 || 31.297 || 31.539 || 204.318

The
Agency's budget for 2014-2020 has already been included in the Commission's
proposal for the new MFF 2014-2020. The new tasks and associated costs will be
financed through a redeployment of the GNSS programme as initially planned for
the years 2014-2020. The impact will be as follows and amounts to EUR 117.1 million.

Budget heading 02.0501 European satellite navigation programmes (EGNOS and Galileo) || Commitments || (3a) || -1.750 || -13.482 || -15.645 || -16.610 || -16.022 || -18.723 || -18.297 || -18.339 || -117.118

|| Payments || (3b) || -1.750 || -13.482 || -15.645 || -16.610 || -16.022 || -18.723 || -18.297 || -18.339 || -117.118

TOTAL appropriations for the GSA in the current MFF || Commitments || =1+1a +3a || || 11.700 || 12.000 || 12.200 || 12.400 || 12.700 || 13.000 || 13.200 || 87.200

Payments || =2+2a +3b || || 11.700 || 12.000 || 12.200 || 12.400 || 12.700 || 13.000 || 13.200 || 87.200

Heading of multiannual financial framework: || 5 || 'Administrative expenditure'

EUR million (to 3 decimal places)

|| || || Year N || Year N+1 || Year N+2 || Year N+3 || insert as many columns as necessary in order to reflect the duration of the impact (see point 1.6) || TOTAL

DG: <.......> ||

Ÿ Human resources || || || || || || || || 0

Ÿ Other administrative expenditure || || || || || || || || 0

TOTAL DG <.......> || Appropriations || || || || || || || || 0

TOTAL appropriations under HEADING 5 of the multiannual financial framework || (Total commitments = Total payments) || || || || || || || ||

EUR million (to 3 decimal places)

|| || || Year N[22] || Year N+1 || Year N+2 || Year N+3 || insert as many columns as necessary in order to reflect the duration of the impact (see point 1.6) || TOTAL

TOTAL appropriations under HEADINGS 1 to 5 of the multiannual financial framework || Commitments || || || || || || || || 0

Payments || || || || || || || || 0

3.2.2.     Estimated impact on
appropriations of the GSA Agency – breakdown by objective and by heading

Commitment appropriations in EUR million (to 3 decimal
places)

|| Indicate objectives and outputs ò || || || Year 2013 || Year 2014 || Year 2015 || Year 2016 || Year 2017 || Year 2018 || Year 2019 || || Year 2020

|| OUTPUTS Type of output

|| Type of output || Average cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost || Number of outputs || Total cost

|| Objective No 1 GNSS Security Accreditation || ||

Titles 1 and 2 || || || || 2.123 || || 2.749 || || 2.804 || || 2.762 || || 2.637 || || 2.878 || || 2.845 || || 2,912 ||

Title 3 || || || || 1.043 || || 1.400 || || 1.400 || || 1.400 || || 1.400 || || 1.400 || || 1.400 || || 1,400 ||

Sub-total for specific objective N°1 || || 3.166 || || 4.149 || || 4.204 || || 4.162 || || 4.037 || || 4.278 || || 4.245 || || 4.312 ||

Objective No 2 Market development and applications development, including quality certification and GNSS communication || ||

Titles 1 and 2 || || || || 1.415 || || 1.833 || || 1.869 || || 1.688 || || 1.612 || || 1.759 || || 1.739 || || 1,780 ||

Title 3 || || || || 664 || || 3.750 || || 3.250 || || 3.200 || || 3.250 || || 3.750 || || 3.750 || || 3.250 ||

Sub-total for specific objective N°2 || || 2.079 || || 5.583 || || 5.119 || || 4.888 || || 4.862 || || 5.509 || || 5.489 || || 5.030 ||

Objective No 3 Operation of the Galileo security monitoring centres and PRS applications development || ||

Titles 1 and 2 || || 3.303 || || 5.193 || || 5.763 || || 6.138 || || 5.861 || || 6.396 || || 6.322 || || 6.472 ||

Title 3 || || 656 || || 1.400 || || 1.500 || || 1.500 || || 1.500 || || 1.650 || || 1.650 || || 1.650 ||

Sub-total for specific objective N°3 || || 3.959 || || 6.593 || || 7.263 || || 7.638 || || 7.361 || || 8.046 || || 7.972 || || 8.122 ||

Objective No 4 Exploitation of the GNSS Systems || ||

Titles 1 and 2 || || 1.750 || || 6.567 || || 8.878 || || 9.974 || || 10.110 || || 11.352 || || 11.379 || || 11.811 ||

Support (Procurement, Finance, HR, Project and control management, Legal, Communication) || ||

Titles 1 and 2 || || 2.496 || || 2.291 || || 2.181 || || 2.148 || || 2.051 || || 2.238 || || 2.213 || || 2.265 ||

TOTAL COST GSA || || 13.450 || || 25.182 || || 27.645 || || 28.810 || || 28.422 || || 31.423 || || 31.297 || || 31.539 ||

The assumptions for which the Agency's
budget is calculated from 2013 to 2020 are the following:

–
The new GNSS Regulation, currently under final
discussion between the European Parliament and the Council, is to be adopted
according to the terms proposed by the Commission. If that is the case,
management of EGNOS exploitation should be transferred to the Agency and the
programme management of the exploitation phase of Galileo should be delegated
to the Agency from 01/01/2014. These major tasks require appropriate staffing
and budgetary resources for the Agency in order to achieve the different
programme milestones. The GNSS programme requirements and their development
ought to entail an expansion of the Agency, which should be particularly fast
until 2016 and gradual thereafter.

–
The set up of the Galileo Security Monitoring Centres
in France and the United Kingdom is currently under preparation. Full
deployment is expected to take place in 2013 and 2014 and operational
validation tests lasting 24 months are to begin at this time, which explains
the need for certain additional staff and one-off costs in 2014. The need for
this centre has been highlighted in particular during the detailed preparation
work for the services. This centre must be equipped with qualified operators
who will use the software and equipment with in-depth knowledge of the security
aspects of the system and who must be trained in the services' deployment and
progressive supply phase. In particular, they must also meet requirements in
terms of access to PRS (Public Regulated Service) for PRS users. They must also
draw up operational procedures and monitor and manage security incidents across
the whole system.

–
Rental costs for the Agency in Prague are free
of charge until June 2017. After that, the Agency will have to pay, 25% of the
commercial market value of the offices as rental costs to the Czech
Authorities. An estimation has been carried out based on real Prague prices.
Apart from headquarters, the Agency will have to cover other rental costs for
additional locations where the Agency will perform its tasks i.e., in France
(St. Germain en Laye, Toulouse), in the United Kingdom (Swanick) and in the
Netherlands (ESTEC Centre, European Space Agency).

–
Staff costs of the Agency are calculated based
on the Commission average costs. They include a relatively low turnover of
staff and an average entry into service for new recruits of April each year.
Cost of living coefficients are also taken into account (Prague is 15% below
Brussels coefficient, while France is 16% above Brussels coefficient).

–
Costs subject to an estimated 3% inflation
annual increase are salaries, rental costs, IT costs and services provided by
the Commission, postage and telecommunications. The other costs have not been
affected by inflation, which leads to a reduction in real costs for the Agency.

–
Current administrative costs have been
calculated based on real costs in 2011 and 2012, without increase due to
inflation.

–
In 2012 and 2013, the Agency IT networks and IT
equipments are being fully renovated due to the relocation of the Agency's
headquarters to Prague in September 2012. Based on depreciation and usability,
a renewal of such equipment is expected in 2018, both for headquarters and for
the Galileo Security Monitoring Centres.

–
During the period 2014-2020 some of the most
important communication activities will take place e.g., launch of Galileo
early services in 2014-2015, Galileo full operational capabilities in
2018-2019. These major events will also require more segment markets to be
included in the Agency's full campaigns, and a major revamp in existing
websites and communication tools (including real time content enhancement).

–
Costs are calculated on the assumption that the
reinforcement of security accreditation independence defined in the present
proposal vis-à-vis the Agency's other tasks will not lead to a duplication of
central administrative services.

The table here below illustrates the
detailed budget of GSA for the period 2013-2020.

3.2.3.     Estimated impact on the
Agency's human resources

3.2.3.1.  Summary

–
 ̈  The proposal/initiative does not require the use of appropriations
of an administrative nature.

–
þ  The proposal/initiative requires the use of appropriations of an
administrative nature, as explained below:

EUR million (to 3
decimal places)

|| 2013 || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || TOTAL

Officials (AD Grades) || || || || || || || || ||

Officials (AST grades) || || || || || || || || ||

Contractual agents || || 1.125 || 1.276 || 1.376 || 1.393 || 1.435 || 1.478 || 1.522 || 9.606

Temporary agents || || 9.768 || 11.081 || 13.071 || 12.960 || 13.550 || 14.061 || 14.599 || 89.090

Seconded National Experts || || || || || || || || ||

TOTAL || || 10.893 || 12.357 || 14.447 || 14.353 || 14.985 || 15.539 || 16.122 || 98.696

The main assumptions used to calculate
staff costs are the following:

- TAs rates = Commission average rate
(9 5000 EUR + inflation)

- CAs rate = = Commission average rate (mix
of FGIII and FGIV = 40 000 EUR + inflation)

- Inflation of 3% per year

- Existing costs of staff reduced by 3% due
to rotation

- New recruited staff cost reduced by 25% -
average entry into service 1 April

- Installation costs according to Staff
Regulations: Installation allowance, daily allowance (only three months),
removal costs, travelling costs.

The Agency's staff required 2013-2020 (in
number of FTEs)

|| 2013 || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020

Temporary agents || 77 || 97 || 109 || 117 || 121 || 123 || 124 || 125

SNEs / CAs || 17 || 25 || 29 || 31 || 31 || 31 || 31 || 31

TOTAL || 94 || 122 || 138 || 148 || 152 || 154 || 155 || 156

The Agency's staff by activity (in number
of FTEs)

|| 2013 || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020

Staff directly assigned to exploitation of GNSS systems || 20 || 43 || 57 || 65 || 69 || 71 || 72 || 73

Staff directly assigned to the GSMC || 28 || 34 || 37 || 40 || 40 || 40 || 40 || 40

Staff for core GSA tasks (existing tasks) || 46 || 45 || 44 || 43 || 43 || 43 || 43 || 43

TOTAL || 94 || 122 || 138 || 148 || 152 || 154 || 155 || 156

The Agency's staff by activity (as a % of
the total)

|| 2013 || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020

% of GSA staff assigned to exploitation || 21% || 35% || 41% || 44% || 45% || 46% || 46% || 47%

Percentage of GSA staff assigned to the GSMC || 30% || 29% || 27% || 26% || 26% || 26% || 26% || 26%

Percentage of GSA staff assigned to core GSA tasks (existing tasks) || 49% || 36% || 32% || 30% || 29% || 28% || 28% || 27%

TOTAL || 100% || 100% || 100% || 100% || 100% || 100% || 100% || 100%

As previously outlined, the Agency will be
responsible for a mix of tasks, some of which are new and some of which are a
continuation of its current activities. The reduction of 5% of the staff
allocated to current tasks of the Agency has been applied, leading to a
reduction of 3 FTEs for its current tasks. This is reflected in the decrease of
1 FTE in 2014, 2015 and 2016 respectively.

The Agency's staff requirements have been
assessed by the Commission after consultation with the Agency and on the basis
of a study detailing all the activities to be carried out for the exploitation
of the programmes[23].

Description of tasks to be carried out:

Officials and temporary agents || 1. Security Accreditation of the GNSS systems (Agency's core task) 2. Management of the Galileo Security Monitoring Centres (Agency's core task, which will be further increased mainly in 2014, following the initial posts in 2012 and 2013) 3. Market Development, GNSS applications development including PRS user technology development (Agency's core task with possible additional delegated tasks) 4. GNSS Communication (Agency's core task) 5. Exploitation of the GNSS systems (new delegated task – tasks relating to EGNOS exploitation constitute a transfer of responsibility from the Commission to the Agency while tasks relating to Galileo's exploitation phase constitute programme management tasks delegated to the Agency). The activities to be carried-out during the exploitation phase have been identified and structured into a Work Breakdown Structure (WBS). Responsibility for all exploitation activities will be delegated to the Agency, which must ensure their coordination but not necessarily their execution. It should be noted that the majority of these activities arise from the need to ensure the operations of service provision and that these activities are not currently addressed in the existing organisation of the programmes. Within the WBS, all activities relating to exploitation can be structured in the following five strands: -           execution management, mainly consisting in o          detailing the high-level objectives set by the Commission, the international or intergovernmental agreements and the system security requirements in the form of a technical Mission Requirement Document o          controlling programme planning, cost and risk, o          setting-up and following-up agreements and contracts required in programme exploitation; -           programme engineering, consisting of the design of future developments in line with the Mission Requirement Document , coordinating system standardisation processes, developing new infrastructure, qualifying the new infrastructure (including software release), performing mission engineering and assessing the performance of the system; -           infrastructure management, relating to the management of the infrastructure project, the performance of system engineering, building the space and ground infrastructures and deploying system updates; -           operations and services provision, consisting of managing the service provisions, operating the infrastructure and monitoring the performance of the operations; -           utilisation of the services through definition and maintenance of a market strategy, promotion of the use and adoption of the services and fostering of the definition and development of new applications.

External personnel || Mostly support/administrative tasks for operations. From 2015, the share of support staff amounts to 16% of all Agency's staff, which is in the lower band of all Agencies and below Union standard levels (this share is estimated at 25% for Union agencies at full cruising speed, and is even higher in the Commission).

The table here below illustrates detailed
staff numbers of the Agency for the period 2013-2020:

The additional staff required by the exploitation
of the systems is essentially composed of AD posts, with less than 10%
allocated to management tasks (AD10-12). The majority of the posts will be
recruited under an AD6-9 grade due to the difficulties involved in recruiting
experienced people with highly specialised technical skills.

3.2.3.2.  Estimated requirements of
human resources for the parent DG

–
þ  The proposal/initiative does not require the use of human
resources.

The proposal does not require the Commission to
make use of additional human resources. On the contrary, reductions are
planned, as also described in paragraph 3.4.

–
 ̈  The proposal/initiative requires the use of human resources, as
explained below:

3.2.4.     Compatibility with the
current multiannual financial framework

–
þ  The proposal/initiative is compatible with the current multiannual
financial framework for 2013 and – as regards future years – with the
Commission's proposal for the 2014-2020 financial framework.

–
 ̈  The proposal/initiative will entail reprogramming of the relevant
heading in the multiannual financial framework.

–
 ̈  The proposal/initiative requires application of the flexibility
instrument or revision of the multiannual financial framework[24].

Explain what is required, specifying the
headings and budget lines concerned and the corresponding amounts.

3.2.5.     Third-party contributions

–
þ The proposal/initiative does not provide for co-financing by third
parties.

–
The proposal/initiative provides for the
co-financing estimated below:

3.3.        Estimated impact on
revenue

–
þ  Proposal/initiative has no financial impact on revenue.

–
 ̈  Proposal/initiative has the following financial impact:

–
 ̈            on own resources

–
 ̈            on miscellaneous revenue

3.4.        Estimated impact on
Commission's human resources

Although this financial statement concentrates
on the effects on the Agency of the delegation of new responsibilities for the
operational management of the GNSS Programmes, it is nevertheless useful to
reflect also on the impact that the future governance of the GNSS Programmes
may have on the Commission's human resources.

As previously explained, the tasks newly
assigned to the Agency are for the most part new tasks for which there are no
equivalents in the current organisational framework of the GNSS Programmes. In
fact, while the tasks associated with the exploitation of EGNOS are to be
transferred from the Commission to the Agency, the tasks associated with the
exploitation of the system arising from the Galileo programme delegated to the
Agency are new tasks as the system is not yet operational. This is because
today Galileo is not yet providing any services, and the teams involved in the
Commission and in the Agency have concentrated their efforts on the deployment
of the infrastructure. The transition to an operational infrastructure, the start
of provision of services on which lives depend will require entirely new
activities and additional personnel. While this will lead to a combined
Commission and Agency staff increase of 31%, the average yearly budget managed
between 2007-2013 and 214-2020 will increase by 103%.

For some years to come and until the
appropriate milestone is achieved, the Commission will continue to be
responsible for the deployment of the Galileo infrastructure and will have to
keep in place the teams that supervise these activities. Thereafter the
Commission's role will focus on the political supervision of the programmes,
and this is why the Commission has proposed to reduce its establishment plan by
a total of 30 posts over the 2014-2020 period. This reduction reflects notably:

2)
the process of transferring EGNOS exploitation
activities (the exploitation phase of the Galileo programme being a new task)
to the Agency will lead to a reduction of Commission GNSS staff numbers by 3
FTEs (3.3%);

3)
the staff decrease decided by the Commission for
existing activities will lead to a further reduction by 12 FTEs (13%);

4)
the principle of an additional staff reduction
of 15 FTEs following internal redeployment in the Commission.

The change in staff numbers at the
Commission for GNSS services is therefore as follows:

Commission staff assigned to GNSS tasks || 2013 || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || Total reduction

Reduction || 0 || -3 || || || -3 || -4 || -5 || 0 || -15

TOTAL || 92 || 89 || 89 || 89 || 86 || 82 || 77 || 77 ||

The additional reduction referred to in
point 3) above will be distributed on a non-linear basis over the seven years.
The reduction by 30 posts is independent and therefore in addition to the
horizontal reduction of 5% in the Commission's workforce between 2013 and 2017;
these posts will all be deducted from the Commission's establishment plan.

Additional reduction in staff at the
Commission

|| 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || Total reduction

TOTAL Additional reduction in staff at the Commission || -2 || -3 || -3 || -2 || -2 || -2 || -1 || -15

These human resources requirements will be
covered by the workforce of the DG already responsible for managing the
activity and/or redeployed internally within the DG, supplemented, as required,
by any additional allocation that could be granted to the managing DG in the
context of the annual allocation procedure and in the light of existing
budgetary constraints.

This reduction is applied despite the
Commission's continued overall responsibility for the GNSS Programmes and
despite a number of new tasks intended for the Commission by the Council and
the European Parliament (as witnessed during the negotiations of the new GNSS
Regulation), such as the definition of a new IPR policy, mission evolution and
stringent reporting requirements to the GNSS Committee, the Council and the
European Parliament. The Commission will endeavour to accommodate these new
tasks through internal redeployments.

Specifically, the Commission's future role
can be summarised in the following six blocks of activities:

–
contributing to the EU's broader policy
objectives: the goal is to promote the inclusion of GNSS technologies across
different areas of research and their considerations in sectoral policy
initiatives ranging from the modes of transport, to agriculture, personal
mobility, timing, energy. The purpose is to ensure that EU policies in these
sectors make the best use of the innovative potential and added value of the
European satellite navigation systems;

–
definition and developing the high-level
objectives of the Programmes to reflect policy requirements and those of other
stakeholders and users, and translating these into programme policy and
technical requirements;

–
defining and adapting the implementation
conditions. In accordance with the strategic objectives of the Commission with
regard to the programmes, measures for their implementation, such as delegation
agreements, need to be defined, site hosting agreements elaborated and
appropriate standards developed. Moreover, the Commission will remain
responsible for the security of the systems. Therefore, it needs to define security
requirements and ensure coordination with regard to security matters;

–
defining and developing the GNSS-related
policies, creating the regulatory and international environment conducive to
achieving the GNSS Programmes' objectives. As part of the work on the
regulatory framework for the GNSS Programmes, the Commission will examine the
safety and security of the GNSS users, assess the vulnerability of satellite
navigation systems and devices and propose countervailing measures, ensure the
harmonisation of European radionavigation services, increase stability to allow
industry to plan future investment, as well as increase safety and security
(for example with the development of measures to reduce the dependency on GPS).
In the international domain, it will draft and negotiate international
agreements and coordinate with international organisations in order to ensure
compatibility and interoperability with other GNSS systems;

–
monitoring of the programmes' implementation.
Although the Commission will not be responsible for the operational management
of the programmes, it retains the overall responsibility with regard to their
smooth progress, and it will be held responsible for any cost overrun or
schedule delay. Therefore, it is crucial that the Commission closely monitors
the implementation of the programmes by the European Space Agency (for the
completion of the deployment phase) and by the European GNSS Agency (for the
exploitation phase). Member States and the European Parliament have also put
forward very stringent requirements for reporting through the draft GNSS
Regulation currently in co-decision. Finally, the Commission will ensure the
preparation, presentation and circulation of these reports to the GNSS
Committee and the Budgetary Authority in particular;

–
managing stakeholder relations by providing
up-to-date, positive, coherent and useful information on the status of
implementation of EGNOS and Galileo to stakeholders, as well as regular,
professional reports for internal and external audiences.

[1]               OJ L 196, 24.07.2008, p. 1.

[2]               OJ L 276, 20.10.2010, p. 11.

[3]               COM(2011) 814 final

[4]               OJ C , , p..

[5]               OJ C , , p..

[6]               OJ L 196; 24.7.2008, p. 1

[7]               OJ L 276; 20.10.2010, p. 11

[8]               OJ L ... of ......2013, p. ...[It should be noted that, as
long as this Regulation and the Regulation implementing the future multiannual
financial framework have not yet been adopted, the scope of the tasks entrusted
to the European GNSS Agency and the budget appropriations assigned accordingly
cannot be regarded as definitive]

[9]               ABM: activity-based management – ABB: Activity-Based
Budgeting.

[10]             As referred to in Article 49(6)(a) or (b) of the
Financial Regulation.

[11]             COM(2011) 814 final

[12]             Details of management modes and references to the
Financial Regulation may be found on the BudgWeb site: http://www.cc.cec/budg/man/budgmanag/budgmanag_en.html

[13]             As referred to in Article 185 of the Financial
Regulation.

[14]             = Differentiated appropriations / Non-diff. =
Non-Differentiated Appropriations

[15]             EFTA: European Free Trade Association.

[16]             Candidate countries and, where applicable, potential
candidate countries from the Western Balkans.

[17]             A Budget for Europe 2020 – COM(2011) 500

[18]             PE489.561v02-00

[19]             This amount differs from the budget of the Agency for
2013 as it takes into account the financing of 20 additional posts in 2013 by
redeployment of the GNSS programmes. The Commission will submit a proposal to
the Budgetary Authority during 2013.

[20]             The repayment of the balance of
the outturn account is added to this total (0.709) and the contribution from
third countries (0.325). Thus, the available appropriations total is 14.484 for
2013.

[21]             This amount includes 1.75 for the funding of 20
additional posts in 2013. The estimate used consists of 6 months of salaries
for 2013 due to the recruitment time needed for the 20 new posts.

[22]             Year N is the year in which implementation of the
proposal/initiative starts.

[23]             This study was performed by the consultant company
Roland Berger in 2011 for EGNOS and 2012 for Galileo. The outcome of the study
was a Work Breakdown Structure of the activities necessary to ensure the
exploitation of the systems and the human resources required for each task. An
outline of the main tasks to be performed by the Agency has been included in
the description of tasks to be carried out.

[24]             See points 19 and 24 of the Interinstitutional
Agreement.