# EUR-Lex - 52011PC0814 - EN

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# 52011PC0814

**Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the implementation and exploitation of European satellite navigation systems /* COM/2011/0814 final - 2011/0392 (COD) */**

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EXPLANATORY
MEMORANDUM

1.
CONTEXT OF THE PROPOSAL

Regulation (EC) No 683/2008, which entered
into force on 25 July 2008, defines the framework for the public governance and
financing of the Galileo and EGNOS programmes[1].
In particular, it allocates EUR 3405 million for the period from 1 January 2007
to 31 December 2013.

As provided for in Article 22 of Regulation
(EC) No 683/2008, the Commission adopted a report to the European Parliament
and to the Council on the mid-term review of the European satellite navigation
programmes on 18 January 2011[2].
This report provides a detailed review of their progress since the reform of
their governance in 2007, sets out cost estimates and future challenges, in
particular with regard to risks and outlines specific proposals to deal with
them, in particular for taking into account the operational requirements of the
two systems established under the programmes.

In the conclusions it adopted on 31 March
2011 after the Commission's report of 18 January 2011 was submitted, the
Council, among other things, expressed its support once again for the European
satellite navigation programmes as defined in Regulation (EC) No 683/2008. It
also noted the overall cost estimates and the fact that the Commission would
submit a proposal including changes to the governance model with a view to the
next multiannual financial framework. On this point, it asked the Commission to
rationalise and optimise the use of existing structures.

For its part, in the resolution adopted on
8 June 2011, the Parliament also restated its support for the European
satellite navigation programmes and considered that it should be principally
funded by the Union budget. It underlined the importance of implementing
rigorous cost containment and risk mitigation policies. It asked the Commission
to submit legislative proposals quickly with particular emphasis on the need to
provide a long-term, stable framework, in particular for operation of the
systems.

In its Communication dated 29 June 2011[3], accompanied by a proposal for
a Council Regulation of the same date[4],
the Commission proposed to assign EUR [7000] million to the financing of the
European satellite navigation programmes during the next multiannual financial
framework for the 2014-2020 period. Nevertheless it indicated here that it is
necessary to maintain efforts to control costs and that new management
procedures should be planned for the long-term. It should be noted that this
sum of EUR [7000] million, at 2011 constant prices, is an absolute ceiling
under the Article [14 of the proposal] of the abovementioned Council Regulation
and corresponds to a sum of EUR [7897] million at current prices.

It needs to be emphasised that
uncertainties, which may lead to cost over-runs and delays, are inherent in
this type of complex programme. It requires an effective risk management system
to be set up, and may result in difficult decisions being taken. In this way,
the additional cost of the development phase, managed by the European Space
Agency, amounts to some EUR 500 million in total. At the request of the Member
States the Commission has agreed to bear this cost so as to ensure the
continuity of the programme. Validation of the system in orbit is the keystone
of the Galileo programme and a lack of financing would have jeopardised its
continuation, with a loss of industrial know-how and of equipment already
partly built.

The Regulation to which the proposal
relates meets the requests of the Parliament and the Council while taking into
account the contents of the Commission Communication of 29 June 2011. It is the
basic act for European satellite navigation programmes for the period covered
by the next multiannual financial framework, providing in particular for
funding and the governance model for the programmes. Given the magnitude of the
changes to be made to Regulation (EC) No 683/2008, it was deemed necessary to
propose that it be replaced with a new Regulation rather than amended.

It should be borne in mind that the Galileo
and EGNOS programmes are flagship projects of the Union. Promotion of this
technology, which is a powerful driver for emerging from the crisis, fits in
perfectly with the Europe 2020 strategy and policies for sustainable
development. The new generations of high-performance satellite navigation services
provide considerable opportunities for all fields of activity with many new
jobs bound up with the expansion of markets, which have grown at an annual rate
of 30% over the past few years. In this context, the Commission is working to
develop an ecosystem of applications to optimise the use of services provided
by the systems and maximise the socio-economic benefits. Accordingly, it is
implementing the 24 measures referred to in its Action Plan on GNSS
applications of 14 June 2010[5].
This plan provides in particular for financing of research and development
projects, improvement in access to financing for small and medium-sized
enterprises and various measures to promote the Galileo and EGNOS programmes in
priority sectors for growth, innovation and employment.

It should also be emphasised that the
European satellite navigation programmes does not only concern the Member
States with the greatest involvement in the space field: they concern all the
Member States of the Union directly. In fact, all citizens of the Union will
benefit from a range of services provided by the infrastructures in place.
Moreover, small and medium enterprises everywhere in Europe play an important
role in the programmes since one of the objectives of the Union is to promote
the widest and most open participation possible for all businesses in public
procurement procedures.

For instance, as part of Europe 2020's
flagship initiative 'An Industrial Policy for the Globalisation Era' the
Commission is responsible for developing 'an effective space policy to provide
the tools to address some of the key global challenges and in particular to
deliver Galileo'.

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

The proposal follows numerous extensive
consultations with stakeholders and the public. It is accompanied by an impact
assessment.

Stakeholders were consulted on various
technical, legal or operational aspects concerning the programmes such as
provision of services, the cost of the infrastructure and its operation, risk
analyses and potential governance models. Thematic workshops and conferences
with users were therefore organised as well as targeted working groups with
experts from the European Space Agency, the European GNSS Agency and the Member
States. Interviews were also conducted with experts from the space sector and
industry representatives.

The public was also involved in the
Eurobarometers between 2007 and 2009 and in the impact assessment concerning
the European space policy.

The range of this research has shown that:

·
the public supports the development of an
independent satellite navigation system and recognise the growing dependence of
modern societies on navigation services;

·
stable governance must be put in place in the
long term to ensure that the programmes are managed effectively;

·
the "Safety of Life Service" (SoL)
provided by the system established under the Galileo programme should be
redefined in view of changing user expectations;

·
finally, civil aviation stakeholders insist on
the need to make long-term commitments concerning the provision of EGNOS
services. This is a prerequisite for any real market penetration of EGNOS.

Moreover, in view of the latest advances
and challenges to be overcome, the impact assessment concentrates on the
continued implementation of the programmes with a focus on two main problems:
firstly, the configuration of future services, given that the budget allocated
for the period 2008-2013 is insufficient to complete the infrastructure of the
system established under the Galileo programme and to ensure the operation of
EGNOS; and secondly, the definition of the operational governance model and the
financing required.

On the first point, concerning the system
established under the Galileo programme, evaluation of the various options has
shown that the best option is to retain the services initially specified, with
the exception of the SoL service. This solution, which requires less
infrastructure on the ground, reduces the costs.

With regard to EGNOS, the system is already
operational and many users are enjoying its benefits. In addition, when the SoL
service was declared operational, the Commission gave assurances regarding the
continuity of this service to users who went on to make significant
investments. Ending the EGNOS programme is not an option in this context.

On the second point, the impact assessment
concluded that the Commission, representing the Union, should remain
responsible for the programmes while the Union continues to ensure their
funding alone, as proposed by the Commission in the abovementioned
Communication of 29 June 2011. Operational management should be entrusted to a
regulatory agency. This would both maximise the expected socio-economic benefits
of operating the systems and ensure greater consistency with the other policies
of the Union while clearly defining the financial and political
responsibilities of the various stakeholders. In this regard and given the
abovementioned conclusions of the Council on 31 March 2011, assigning this task
to the European GNSS Agency which was established by Regulation (EU) No
912/2010 of the European Parliament and of the Council of 22 September 2010 for
the performance of tasks associated with the progress of the programmes, and
which is both already in place and active in the field of satellite navigation,
appears to be the most natural solution. It would nevertheless be necessary to
reconfigure the tasks and resources of this agency.

3.
LEGAL ELEMENTS OF THE PROPOSAL

Like Regulation (EC) No 683/2008 and other
texts of the Union acquis concerning European satellite navigation
programmes, the legal basis of the Commission's proposal is Article 172 of the
Treaty on the Functioning of the European Union, ex Article 156 of the Treaty
establishing the European Community. In addition, it retains the form of a
Regulation of the European Parliament and of the Council since, like Regulation
(EC) No 683/2008 which it is to replace, the text has a general scope and its
content is to be directly applicable in all Member States.

The proposal mainly defines the programmes
and systems, the budgetary resources allocated to them and their governance
model and, in the interests of rationalising the acquis of the union,
also provides for amendment or repeal of other legislative texts concerning European
satellite navigation programmes.

The proposal complies with the principles
of subsidiarity and proportionality. The objective of the proposal, namely the
implementation and operation of satellite navigation systems, exceeds the
financial and technical capacities of a Member State acting alone and can only
be achieved in a satisfactory manner at Union level. It does not go beyond what
is necessary to achieve this objective insofar as the planned budget
corresponds to costs estimated following extensive analyses and where the
governance model used appears to be the most suitable.

4.
BUDGETARY IMPLICATIONS

As indicated in point 2 above, the Union
will continue to finance the Galileo and EGNOS programmes alone. Its
contribution to the programmes for the period 2014-2020 shall not exceed EUR
[7897] million at current prices in accordance with the Article [14 of the
proposal] of the Council Regulation referred to in point 1 above. It covers
three main activities, namely, completion of the deployment phase of the
Galileo programme, the exploitation phase of the same programme and operation
of the EGNOS system. The latter includes ongoing improvement of the services
provided by the system in order to meet the changing needs of users.

The estimated costs of the programmes are
the result of extensive analyses. They are also based on the results of
discussions with experts, in particular from the Member States, the European
Space Agency and the European GNSS Agency. Various stakeholders, such as
industrial representatives of the space sector, were also consulted.

Retaining the expertise acquired within the
Commission is an essential factor in ensuring the continuity of the programmes.
Consequently, the Commission will retain temporary agents currently in
employment for periods to be determined in accordance with the various phases of
the programmes and will transfer personnel to the European GNSS Agency.

5.
OPTIONAL ELEMENTS

It is important to emphasise that this
Regulation lays down, in particular, the governance model for the programmes
and their financing for the period 2014-2020. In accordance with this model, it
will be possible to entrust substantial tasks associated with the operation of
the systems to the European GNSS Agency, which is a body within the meaning of
Article 185 of Regulation (EC, Euratom) No 1605/2002 of 25 June 2002
on the Financial Regulation applicable to the general budget of the European
Communities. Accordingly, the Commission intends to conclude one or more
delegation agreements with the Agency.

In the opinion of the Commission, recourse
to delegation agreements, which include the general conditions for managing
funds entrusted to the Agency, including measures for monitoring and controlling
costs, is the most appropriate method for the Commission, the European
Parliament and the Council to exercise their power of control fully.

In order to enable the European Parliament
and the Council to gain a full picture of the conditions under which the
European GNSS Agency would be obliged to carry out the tasks entrusted to it
under the new governance model, particularly concerning resources, the
Commission will submit a proposal in 2012 for the amendment of Regulation (EU)
No 912/2010 and of the associated financial statement. It should be noted that
the budget allocated to the programmes, i.e. EUR [7897] million at current
prices, already takes into account the operating costs of the systems,
including the operating costs of entities required to manage the operation of
the systems. Thus, performance by the agency of new tasks which will be
entrusted to it, will not lead to any additional budget expenditure.

In addition, the Commission will assess the
compatibility of Regulation (EU) No 912/2010 with the new governance model
concerning the security accreditation of the systems.

Council Joint Action 2004/552/CFSP of 12
July 2004 on aspects of the operation of the European satellite
radio-navigation system affecting the security of the European Union[6], should also be updated.

Simplification of the rules is one of the
key goals of the new approach proposed by the Commission in respect of the
budgetary expenditure of the Union. In its current form, the text introduces
simplifying measures, concerning the following points in particular:

–
alignment of indicators concerning the 2020
strategy objectives;

–
delegation of activities associated with system
operation, in particular, the management of contracts with the European GNSS
Agency.

2011/0392 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL

on the implementation and exploitation of
European satellite navigation systems

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 transmission of the draft legislative
act to the national Parliaments,

Having regard to the opinion of the
European Economic and Social Committee[7],

Having regard to the opinion of the
Committee of the Regions[8],

Acting in accordance with the ordinary
legislative procedure,

Whereas:

(1)
The aim of the European satellite navigation
policy is to provide the Union with two satellite navigation systems, the
system established under the Galileo programme and the EGNOS system
(hereinafter 'the systems'). These systems arise respectively from the Galileo
and EGNOS programmes (hereinafter 'the programmes'). Each infrastructure is
made up of satellites and a network of earth stations.

(2)
The aim of the Galileo programme is to establish
and operate the first global satellite navigation and positioning
infrastructure specifically designed for civilian purposes. The system
established under the Galileo programme is completely independent of other
existing or potential systems.

(3)
The aim of the EGNOS programme is to improve the
quality of signals from existing global navigation satellite systems
(hereinafter 'GNSS').

(4)
The European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions have consistently
given their full support to the programmes.

(5)
Since the programmes are at an advanced
development stage leading to systems in an exploitation phase, a specific legal
basis is required which can meet their needs, particularly in terms of governance
and to satisfy the requirement for sound financial management.

(6)
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.

(7)
The Galileo and EGNOS programmes are an
industrial policy tool and are part of the Europe 2020 strategy, as illustrated
by the Commission Communication of 17 November 2010 entitled 'An integrated
industrial policy for the globalisation era: putting competitiveness and
sustainability at centre stage'[9].
They also appear in the Communication adopted on 4 April 2011 by the Commission
entitled 'Towards a space strategy for the European Union that benefits its
citizens'[10].
These programmes provide many advantages for the economy and citizens of the
Union, whose cumulative value has been estimated at approximately EUR 130
billion in the period 2014-2034.

(8)
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. In
addition, due to their strategic aspect, satellite navigation systems are
sensitive infrastructures, that could be susceptible to malicious use. The
abovementioned aspects could affect the security of the Union and its Member
States. Security requirements must therefore be taken into account in the
design, implementation and operation of the infrastructures emerging from the
Galileo and EGNOS programmes.

(9)
The Galileo programme includes a definition
phase which is complete, a development and validation phase due for completion
in 2013, a deployment phase which was launched in 2008 and is due for
completion in 2020 and an exploitation phase which should be launched
progressively from 2014/15 for a fully operational system in 2020.

(10)
The EGNOS programme has been in the exploitation
phase since its open service and 'Safety of Life' service were declared
operational in October 2009 and March 2011 respectively.

(11)
In order to optimise the use of the services
provided, the systems, networks and services emerging from the Galileo and
EGNOS programmes must be compatible and interoperable with one another and,
insofar as possible, with other satellite navigation systems and conventional
means of radio navigation.

(12)
Since the Union is responsible, in principle,
for financing the programmes in full, provision should be made for it to own
all tangible and intangible assets created or developed under these programmes.
In order to comply fully with any fundamental rights relating to ownership, the
necessary arrangements with existing owners should be made, particularly for
essential elements of the infrastructures and their security. In order to
facilitate adoption of satellite navigation by the markets, there is a need to
ensure that third parties can make optimum use in particular of the
intellectual property rights arising from the programmes which belong to the
Union, in particular at social and economic level.

(13)
The deployment and exploitation phases of the
Galileo programme and the exploitation phase of the EGNOS programme should, in
principle, be entirely financed by the Union. However in accordance with
Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the financial
regulation applicable to the general budget of the European Communities[11], the Member States should be
able to provide additional funding to the programmes or a contribution in kind,
on the basis of appropriate agreements, in order to fund additional programme
elements requested by them, e.g. concerning the system architecture or
particular security needs. Third countries and international organisations
should also be able to contribute to the programmes.

(14)
In order to guarantee the continuation of the
programmes, an appropriate financial framework must be established to allow the
Union to continue to finance them. It is also necessary to indicate the amount
of money required between 1 January 2014 to 31 December 2020 to finance
completion of the deployment phase of the Galileo programme and operation of
the systems.

(15)
The European Parliament and the Council, on the
basis of the Commission proposal of 29 June 2011, [decided] to allocate a
maximum sum of EUR [7897] million at current prices for the financing of
activities associated with the programmes for the period from 1 January 2014 to
31 December 2020. It should be specified that these activities also cover the
protection of the systems and their operation, including during the launch of
satellites. In this respect, a contribution to the costs required to benefit
from services capable of providing this protection, such as those provided by
the 'Space Situational Awareness' (SSA) programme among others, could be
financed by the budget allocated to the programmes insofar as possible
following rigorous cost management and full compliance with the abovementioned
total sum established in the Article [x] of Council Regulation XYZ determining
the financial framework for the period 2014-2020. The present Regulation lays
down, for the continuation of the programmes, a financial envelope constituting
the prime reference, within the meaning of point [17] of the Interinstitutional
Agreement of xx/yy/201z between the European Parliament, the Council and the
Commission on budget cooperation and sound financial management, and within the
meaning of Article 14 [of the Council Regulation Proposal of 29 June 2011]
determining the multiannual financial framework for 2014-2020[[12]].

(16)
The activities should be specified for which the
Union budget appropriations allocated to the programmes for the period
2014-2020 under this Regulation shall be granted. These appropriations
should be granted mainly for activities associated with the deployment phase of
the Galileo programme, including management and monitoring activities for this
phase, and activities associated with the operation of the system established
under the Galileo programme, including actions preceding or in preparation for
this phase, and the operation of the EGNOS system. They should also be
granted for funding of certain other activities required to manage and achieve
the objectives of the programmes.

(17)
It is important to note that the investment and
operating costs of the systems as estimated for the period 2014-2020 do not
take account of unforeseen financial obligations which the Union may be
obliged to bear, in particular those relating to non-contractual liability
arising from the public ownership of the systems, especially with regard to
force majeure and catastrophic failure. These obligations are the subject of a
specific analysis by the Commission.

(18)
It should also be noted that the budgetary
resources planned under this Regulation do not cover work financed by funds
allocated to the Horizon 2020 programme, a Framework Programme for Research and
Innovation, such as that associated with the development of applications
derived from the systems. This work will help to optimise the use of the
services provided in the context of the programmes, to ensure a good social and
economic return on the investments made by the Union and to increase the
know-how of businesses in the Union with regard to satellite navigation
technology.

(19)
In addition the revenue generated by the systems
should accrue to the Union in order to compensate for the investments that it
has made previously. A revenue-sharing mechanism might also be provided for in
contracts concluded with private sector companies.

(20)
In order to avoid the cost over-runs and delays
which have affected the progress of the programmes over the last few years,
efforts need to be stepped up to control risks which might lead to excess costs
as requested by the Council and the Parliament in their respective conclusions
and resolutions of 31 March 2011 and 8 June 2011, and as shown by the
Commission's Communication to the European Parliament, the Council, the
Economic and Social Committee and the Committee of the Regions of 29 June 2011
entitled 'A budget for Europe 2020'[13].

(21)
Sound public governance of the Galileo and EGNOS
programmes assumes, firstly, that there is a strict division of tasks, in
particular between the Commission, the European GNSS Agency and the European
Space Agency, and, secondly, that the governance is progressively adapted to
the operational requirements of the systems.

(22)
Given that it represents the Union, which, in
principle, provides financing for the programmes alone and owns the systems,
the Commission must be responsible for the progress of the programmes and their
political supervision. It must manage the funds allocated to the programmes
under the current Regulation, supervise the implementation of all activities of
the programmes and a clear division of tasks, in particular between the
European GNSS Agency and the European Space Agency. Accordingly, in addition to
the tasks associated with these general responsibilities and the other tasks
incumbent upon it under this Regulation, it should be assigned a non-exhaustive
set of specific tasks. In order to optimise the resources and competences of
the various stakeholders, it should be able to delegate certain tasks by means
of delegation agreements, in accordance with Regulation (EC, Euratom) No
1605/2002 and, in particular, Article 54 thereof.

(23)
The European GNSS Agency was established by
Regulation (EU) No 912/2010 of the European Parliament and of the Council of 22
September 2010 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[14] in order to achieve the
objectives of the Galileo and EGNOS programmes and implement certain tasks
associated with the progress of the programmes. It is an agency of the Union
which, as a body within the meaning of Article 185 of Regulation (EC, Euratom)
No 165/2002, is subject to the obligations applicable to Union agencies. It
should be assigned certain tasks associated with programme security, its
potential designation as a competent PRS authority and its contribution to the
marketing of the systems. It should also perform tasks which the Commission may
confer on it by means of one or more delegation agreements covering other
various specific tasks associated with the programmes, including tasks
associated with the exploitation phases of the systems and promotion of the
applications and services on the satellite navigation market. In order for the
Commission, representing of the Union, to exercise its power of control fully,
these delegation agreements should include the general conditions governing the
management of funds entrusted to the European GNSS Agency.

(24)
The Union should conclude a multiannual
delegation agreement with the European Space Agency covering the technical and
planning aspects of the programmes. In order for the Commission, representing
the Union, to exercise its power of control fully, the delegation agreement
should include the general conditions for managing the funds entrusted to the
European Space Agency. Concerning activities exclusively financed by the Union,
these conditions must ensure a degree of control comparable to that required if
the European Space Agency was an Agency of the Union.

(25)
Responsibility for the progress of the
programmes includes, in particular, responsibility for their security and the
security of their systems and operation. Except in the case of application of
Joint Action 2004/552/CFSP of 12 July 2004 on aspects of the operation of the
European satellite radio-navigation system affecting the security of the
European Union[15],
which could be adapted if necessary to changes in the programmes, their
governance and the Lisbon Treaty, the Commission is responsible for security,
even if certain security-related tasks are entrusted to the European GNSS
Agency. It is the responsibility of the Commission to establish mechanisms to
ensure suitable coordination between the various entities responsible for
security.

(26)
Given the specific expertise of the European
External Action Service and its regular contact with administrations of third
countries and international organisations, it is in a position to assist the
Commission in performing certain of its tasks relating to security of systems
and programmes in the field of external relations, in accordance with Council
Decision 2010/427/EU of 26 July 2010 determining the organisation and operation
of the European External Action Service[16]
and, in particular, Article 2(2) thereof.

(27)
In order to allocate the Union funds attributed
to the programmes with a ceiling total that the Commission must not exceed,
effective public procurement procedures must be applied and, in particular,
contracts negotiated so as to ensure optimum use of resources, satisfactory
services, smooth running of programmes, good risk management and compliance
with the proposed schedule. The contracting authority must make every effort to
meet these requirements.

(28)
As the programmes will be, in principle,
financed by the Union, public procurement under the programmes should comply
with Union rules on public contracts and should aim, first and foremost, to
obtain best value for money, control costs, mitigate risks, improve efficiency
and reduce reliance on a single supplier. Open access and fair competition
throughout the supply chain and the balanced offering of participation
opportunities to industry at all levels, including, in particular, new entrants
and small and medium-sized enterprises (hereinafter 'SMEs'), should be ensured.
Possible abuse of dominance and of long-term reliance on single suppliers
should be avoided. In order to mitigate programme risks, to avoid reliance on a
single source of supply and to ensure better overall control of the programmes
and their costs and schedules, multiple sourcing should be pursued, wherever
appropriate. Union industries should be permitted to rely on non-Union sources
for certain components and services where substantial advantages in terms of
quality and costs are demonstrated, taking account, however, of the strategic
nature of the programmes and of Union security and export control requirements.
Advantage should be taken of public sector investment and industrial experience
and competence, including that acquired during the definition and development
and validation phases of the programmes, while ensuring that the rules on
competitive tendering are not contravened.

(29)
Satellite navigation is a new, complex and
constantly changing technology. This results in uncertainty and risk for public
contracts concluded under the programmes, insofar as these contracts may
involve long-term commitments to equipment or services. These characteristics
require specific measures to be implemented concerning public contracts which
apply in addition to the rules laid down in Regulation (EC, Euratom) No
1605/2002. In this way, the contracting authority should be able to restore a
level playing field when one or more companies have, prior to a call for
tenders, privileged information on the activities associated with this call for
tender. It should be possible to award a contract in the form of a conditional
stage-payment contract, introduce an amendment, under certain conditions, in
the context of its performance, or even impose a minimum level of
subcontracting Finally, due to the technological uncertainties that are a
feature of the programmes, contract prices cannot always be forecast accurately
and it is therefore desirable to conclude contracts in a specific form that do
not stipulate a firm fixed price and include clauses to safeguard the financial
interests of the Union.

(30)
It should be reiterated that, in accordance with
Article 4(3) of the Treaty on the European Union, the Member States should not
take measures which could harm the progress of the programmes, in particular
concerning intellectual property rights and the continuity of infrastructure
operation It should also be clarified that the Member States concerned
should take all necessary measures so that the systems' earth stations are
designated as European critical infrastructures.

(31)
In view of the global nature of the systems, it
is essential that the Union can enter into agreements with third countries and
international organisations in the context of programmes under Article 218 of
the Treaty on the Functioning of the European Union, in particular to ensure
their smooth implementation, optimise services provided to citizens of the Union
and meet the needs of third countries and international organisations. It is
also useful, where necessary, to adapt existing agreements to changes in the
programmes. When preparing or implementing these agreements, the Commission may
have recourse to the assistance of the European External Action Service, the
European Space Agency and the European GNSS Agency, within the limits of the
tasks allocated to them under this Regulation.

(32)
It should be confirmed that the Commission, in
performing certain of its tasks of a non-regulatory nature, may have recourse,
as required and insofar as necessary, to the technical assistance of certain
external parties. Other bodies involved in the public governance of the
programmes may also make use of the same technical assistance in performing
tasks entrusted to them under this Regulation.

(33)
Protection of personal data and private life
should be ensured under the programmes.

(34)
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.

(35)
It is necessary to ensure that the European
Parliament and the Council are kept regularly informed about the implementation
of the programmes. In addition, the European Parliament, the Council and the
Commission will meet in the Galileo Interinstitutional Panel in accordance with
the Joint declaration on the Galileo Interinstitutional Panel of 9 July 2008.

(36)
Assessments should be carried out by the
Commission in order to evaluate the effectiveness and efficiency of the
measures taken to achieve the objectives of the programmes.

(37)
In order to set out the necessary measures to
ensure compatibility and interoperability of systems with other satellite
navigation systems as well as with conventional means of radio navigation and
to ensure the security of the systems and their operation, the power should be
delegated to the Commission to adopt acts under Article 290 of the Treaty on
the Functioning of the European Union concerning these two areas of competence.
It is of particular importance that the Commission carry out
appropriate consultations during its preparatory work, including at expert
level. The Commission, when preparing and drawing up delegated acts, should
ensure that the relevant documents are forwarded to the
European Parliament and Council in a simultaneous, timely and appropriate
fashion.

(38)
In order to ensure uniform conditions for the
implementation of this Regulation, implementing powers should be conferred on
the Commission. These powers should be exercised in accordance with Regulation
(EU) No 182/2011 of the European Parliament and of the Council of 16 February
2011 laying down the rules and general principles concerning mechanisms for
control by Member States of the Commission's exercise of implementing powers[17].

(39)
As sound public governance requires uniform
management of the programmes, faster decision-making and equal access to
information, representatives of the European GNSS Agency and the European Space
Agency should be able to take part as observers in the work of the European
GNSS Programmes Committee in accordance with Article 19 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)[18].
For the same reasons, representatives of third countries and international organisations
who have concluded an international agreement with the Union should be able to
take part in the work of the European GNSS programmes' committee. These
representatives of the European GNSS Agency, the European Space Agency, third
countries and international organisations cannot take part in Committee voting
procedures.

(40)
Since the objective of this Regulation, namely
the establishment and operation of satellite navigation systems, cannot be
sufficiently achieved by the Member States since it exceeds the financial and
technical capacities of any single Member State, and can therefore be better
achieved by action at Union level, the Union may adopt measures, in accordance
with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance
with the principle of proportionality, as set out in that Article, this
Regulation does not go beyond what is necessary in order to achieve that
objective.

(41)
The Galileo Joint Undertaking created by Council
Regulation (EC) No 876/2002 [19]
ceased its operations on 31 December 2006 and the proceedings involved in
winding up the undertaking are now complete. It follows that Regulation (EC) No
876/2002 should be repealed.

(42)
Given the need to evaluate the programmes, the
importance of the changes to be made to the text and in the interests of
clarity and legal certainty, Regulation (EC) No 683/2008 must be repealed,

HAVE ADOPTED THIS REGULATION:

CHAPTER I

GENERAL
PROVISIONS

Article 1

European
satellite navigation systems and programmes

1.           The Galileo and EGNOS
programmes shall cover all the activities needed to define, develop, validate,
construct, operate, renew and improve the two European satellite navigation
systems, namely the system established under the Galileo programme and the
EGNOS system, and to ensure their security.

2.           The system established
under the Galileo programme is an autonomous global navigation satellite system
(GNSS) infrastructure consisting of a constellation of satellites and a global
network of earth stations.

3.           The EGNOS system is an
infrastructure monitoring and correcting signals emitted by existing global
satellite navigation systems. It consists of earth stations and several
transponders installed on geostationary satellites.

4.           The specific objectives of
the Galileo programme are to ensure that the signals emitted by the system
under this programme can be used to fulfil the following five functions:

(a)
to offer an open service (OS), which is free to
the user and provides positioning and synchronisation information intended for
high-volume satellite navigation applications;

(b)
to offer a safety-of-life service (SoL) aimed at
users for whom safety is essential. this service also fulfils the requirements
of certain sectors for continuity, availability and accuracy and includes an
integrity function alerting the user to any failure in the system;

(c)
to offer a commercial service (CS) for the
development of applications for professional or commercial use by means of
improved performance and data with greater added value than those obtained through
the open service;

(d)
to offer a public regulated service (PRS)
restricted to government-authorised users, for sensitive applications which
require a high level of service continuity; this service uses strong, encrypted
signals;

(e)
to participate in the search and rescue support
service (SAR) of the COSPAS-SARSAT system by detecting emergency signals given
off by beacons and relaying messages to them.

5.           The specific objectives of
the EGNOS programme are to ensure that the signals emitted by the EGNOS system
can be used to fulfil the following three functions:

(a)
to offer an open service (OS), which is free to
the user and provides positioning and synchronisation information intended for
high-volume satellite navigation applications in the area covered by the system;

(b)
to offer a service for the dissemination of
commercial data, the EGNOS Data Access Service (EDAS), to promote the
development of applications for professional or commercial use by means of
improved performance and data with greater added value than those obtained
through the open service;

(c)
to offer a safety-of-life service (SoL) service
aimed at users for whom safety is essential; in particular, this service
fulfils the requirements of certain sectors for continuity, availability
and accuracy and includes an integrity message alerting the user to any
failure in the system over the coverage area.

The EGNOS programme also has the specific
objective of extending geographic coverage to these services throughout the
territory of the Union and, subject to technical constraints and on the basis
of international agreements, to other regions of the world, in particular
territories of third countries covered by the single European sky.

Article 2

Subject

This
Regulation lays down the rules in relation to the implementation and operation
of the systems under the European satellite navigation programmes, in
particular those relating to the governance and the financial contribution of
the Union.

Article
3

Galileo programme phasing

The Galileo programme shall consist of the
following phases:

(a)
a definition phase during which the structure of
the system was designed and its elements determined, which ended in 2001;

(b)
a development and validation phase, comprising
the construction and launch of the first satellites, the establishment of the
first ground-based infrastructures and all the work and operations necessary to
validate the system in orbit; the aim is for this phase to be completed
in 2013;

(c)
a deployment phase consisting of the
establishment and protection of all space and ground-based infrastructures as
well as related operations which include preparations for the exploitation
phase; the aim is for this phase, begun in 2008, to be completed in 2020;

(d)
an exploitation phase comprising infrastructure
management, maintenance, ongoing improvement, renewal and protection of the
system, certification and standardisation operations associated with the
programme, the supply and marketing of services and all other activities needed
to develop the system and ensure that the programme runs smoothly; the aim is
for this phase to begin progressively between 2014 and 2015 with provision of
the initial services.

Article
4

Operation of the EGNOS system

Operation of
the EGNOS system mainly includes management of the infrastructure, maintenance,
ongoing improvement, renewal and protection of the system, approval,
certification and standardisation activities associated with the programme, all
elements justifying the reliability of the system and its operation as well as
provision and marketing of services.

Article
5

Compatibility and interoperability of the systems

1.
The systems, networks and services resulting
from the Galileo and EGNOS programmes shall be compatible and interoperable.

2.
The systems, networks and services resulting
from the Galileo and EGNOS programmes shall, insofar as possible, be compatible
and interoperable with other satellite navigation systems as well as with
conventional means of radio navigation.

3.
The Commission shall lay down, by means of
delegated acts, in accordance with Article 34, the requirements and standards
necessary to ensure the compatibility and interoperability referred to in
paragraph 2.

Article
6

Ownership

The Union shall be the owner of all
tangible and intangible assets created or developed under the programmes, to
which effect agreements shall be concluded with third parties, wherever
appropriate, with regard to existing ownership rights.

In particular, the Commission shall ensure
that the Union's intellectual property rights are used optimally.

CHAPTER II

BUDGETARY
CONTRIBUTION AND MECHANISMS

Article 7

Activities
concerned

1.           The Union budgetary
appropriations allocated to the programmes for the period 2014-2020 under this
Regulation shall be granted to finance:

a)      activities relating to the deployment
phase of the Galileo programme, including actions to manage and monitor this
phase;

b)      activities relating to operation of
the system established under the Galileo programme, including advance or
preparatory actions for this phase;

c)      activities associated with the
operation of the EGNOS system.

2.           The Union budget
appropriations assigned to the programmes may also cover Commission expenditure
relating to preparation, monitoring, inspection, audit and assessment
activities required for their management and the implementation of the
objectives, in particular expenditure covering:

(a)
studies and meetings with experts;

(b)
information and communication activities,
including institutional communication on the policy priorities of the Union
where they are directly linked to the objectives of this Regulation;

(c)
IT technology networks, with the objective of
processing or transferring data;

(d)
any other technical or administrative assistance
given to the Commission for the management of programmes.

3.           In order to allow the
costs of the programmes and of the different phases of the programmes to be
clearly identified, the Commission, in accordance with the principle of
transparent management, shall inform the Committee referred to in Article 35(1)
annually of the allocation of Union funds to each of the activities specified
in paragraphs 1 and 2.

Article
8

Financing of the Galileo programme

1.           The deployment and
exploitation phases shall be financed by the Union in accordance with Article
10(1) without prejudice to paragraphs 2 and 3 of the present Article.

2.           The Member States may
provide additional funding to the Galileo programme. The revenue arising from
these contributions shall constitute assigned revenue in accordance with
Article 18(2) of the Regulation (EC, Euratom) No 1605/2002. In accordance with
the principle of transparent management, the Commission shall communicate any
impact on the Galileo programme resulting from the application of this
paragraph to the Committee in accordance with Article 35 (1) of this
Regulation.

3.           Third countries and
international organisations may also provide additional funding to the Galileo
programme. The agreements under Article 28 stipulate the conditions and
arrangements for their involvement.

Article
9

Financing of operation of the EGNOS system

1.           The Union shall finance
operation of EGNOS, in accordance with Article 10(1), without prejudice to any
contribution from any other funding source, including those referred to in
paragraphs 2 and 3 of this Article.

2.           The Member States can
provide additional funding to the EGNOS programme. The revenue arising from
these contributions shall constitute assigned revenue in accordance with
Article 18(2) of the Regulation (EC, Euratom) No 1605/2002. In accordance with
the principle of transparent management, the Commission shall communicate any
impact on the EGNOS programme resulting from the application of this paragraph
to the Committee in accordance with Article 35 (1) of this Regulation.

3.           Third countries and
international organisations may also provide additional funding to the EGNOS
programme. The agreements under Article 28 stipulate the conditions and
arrangements for their involvement.

Article 10

Resources

1.           The maximum amount
allocated by the Union to implement the activities specified in Article 7(1)
and (2) shall be EUR [7897] million at current prices for the period from 1
January 2014 to 31 December 2020.

2.           The appropriations shall
be implemented in accordance with the provisions of this Regulation and
Regulation (EC, Euratom) No 1605/2002.

3.           Budgetary commitments for
the programmes shall be appropriated in annual instalments.

Article 11

Revenue
generated by the programmes

1.           Revenue generated by
operation of the systems shall be collected by the Union, paid to the Union
budget and allocated to the programmes. If the income proves to be more than
required to fund the programme exploitation phases, any adaptation of the
principle of allocation shall be approved by the budgetary authority on the
basis of a proposal from the Commission.

2.           A revenue-sharing
mechanism may be provided for in contracts concluded with private sector
entities.

3.           The interest generated by
pre-financing payments made to entities responsible for implementing the budget
indirectly is assigned to activities subject to the delegation agreement or the
contract concluded between the Commission and the entity concerned. In
accordance with the principle of sound financial management, the entities
responsible for indirect implementation of the budget, shall open accounts enabling
the funds and corresponding interest to be identified.

CHAPTER III

PUBLIC
GOVERNANCE OF THE PROGRAMMES

Article 12

General
framework for governance of the programmes

Public governance of the programmes is
based on the principle of a strict division of tasks between the various bodies
involved, in particular the Commission, European GNSS Agency and the European
Space Agency.

Article 13

Commission's
role

1.           The Commission is
responsible for the progress of the programmes. It manages the funds allocated
to them under this Regulation and monitors the implementation of all programme
activities.

2.           In addition to the general
tasks referred to in paragraph 1 and those referred to in the other provisions
of this Regulation, the Commission's tasks under this Regulation include the
following specific tasks:

(a)
it shall ensure a clear division of tasks
between the various bodies involved in the programmes and to this end allocate
the tasks referred to respectively in Articles 15(1)(d) and 16, in particular
by means of delegation agreements, to the European GNSS Agency and the European
Space Agency;

(b)
it shall implement the correct instruments and
structural measures necessary to identify, control, mitigate and monitor the
risks associated with the programmes, in particular in terms of cost and
schedule;

(c)
it shall manage, on behalf of the Union and in
its field of competence, relationships with third countries and international
organisations;

(d)
it shall ensure the security of the programmes
and establish coordination mechanisms between the various bodies involved.

3.           When necessary for the
smooth progress of the phases of the Galileo programme and the operation of the
EGNOS system referred to respectively in Article 3 and 4, the Commission shall
lay down the measures required to:

(a)
determine the location and ensure the operation
of the ground-based infrastructure of the systems;

(b)
define the key decision stages to evaluate the implementation
of the programmes;

(c)
reduce the risks inherent in the progress of the
programmes.

These implementing measures shall be adopted in
accordance with the assessment procedure referred to in Article 35(3).

Article 14

Security
of systems and their operation

1.           The systems and their
operation shall be secure.

2.           Without prejudice to
Articles 15 and 17 of this Regulation and Article 8 of Decision 1104/2011/EU of
the European Parliament and of the Council[20],
the Commission may lay down, by means of delegated acts in accordance with
Article 34, the requirements and standards necessary to ensure the security of
the systems and their operation referred to in paragraph 1. To this end, it
shall take into account the need for the supervision and integration within all
the programmes of security-related requirements, as well as the effect of these
requirements on the successful progress of the programmes, in particular in
terms of costs and timetable.

3.           The European External
Action Service shall assist the Commission, in accordance with Article 2(2) of
Decision 2010/427/EU in implementing security-related tasks in the field of
external relations. In this same field, it shall also assist the Commission in
monitoring of compliance with the joint minimum standards provided for in
Decision 1104/2011/EU. To this end, the correct resources shall be made
available and transition periods shall be put in place to ensure the continuity
of programmes and services.

Article 15

The
role of the European GNSS Agency

1            In order to achieve the
programme objectives, the European GNSS Agency shall contribute to their
implementation and carry out the following tasks, in accordance with the
guidelines laid down by the Commission:

(a)
with regard to the security of the programmes,
and without prejudice to Articles 14 and 17, it shall ensure:

(i)      by 30 June 2016 at the latest,
security certification in accordance with chapter III of Regulation (EU) No
912/2010; accordingly, it shall initiate and monitor the implementation of
security procedures and perform system security audits;

(ii)      the operation of the Galileo
security centre, in accordance with the standards and requirements referred to
in Article 14 and the instructions provided under Joint Action 2004/552/CFSP
referred to in Article 17;

(b)
it shall perform the tasks of a competent PRS
authority provided for in Article 5 of Decision No 1104/2011/EU, if it is
designated as such and it shall assist the Commission in monitoring compliance
with the common minimum standards in accordance with Article 8(6) of the
abovementioned Decision;

(c)
in the context of the operation of the systems,
it shall contribute to the marketing of services, including the necessary
market analysis;

(d)
it shall also perform other specific tasks
associated with the programmes which may be entrusted to it by the Commission
by means of a delegation agreement adopted on the basis of a delegation
decision, in accordance with Article 54(2)(b) of Regulation (EC, Euratom) No
1605/2002, which include:

(i)      operational activities relating to
infrastructure management, maintenance, ongoing improvement and renewal of the
systems, certification and standardisation operations in the context of the
programmes and provision of the services referred to in Article 3(d) and in
Article 4;

(ii)      promotion of applications and
services in the satellite navigation market;

2.           In addition to the tasks
referred to in paragraph 1 and within the confines of its mission, the European
GNSS Agency shall provide the Commission with its technical expertise and
supply any information necessary for the performance of its tasks under this
Regulation.

3.           The Committee referred to
in Article 35(1) shall be consulted on the delegation decision referred to in
paragraph 1(d) of this Article, in accordance with the consultation procedure
referred to in Article 35(2). The Committee shall be informed of the delegation
agreements to be concluded by the Union, represented by the Commission and the
European GNSS Agency.

Article 16

The
role of the European Space Agency

1.           The Commission shall
conclude a multiannual delegation agreement with the European Space Agency on
the basis of a delegation decision adopted by the Commission in accordance with
Article 54(2) of Regulation (EC, Euratom) No 1605/2002. This agreement shall
cover the execution of tasks and the budget subject to the delegation in
accordance with the implementation of the programmes, in particular completion
of the infrastructure under the Galileo programme.

2.           The delegation agreement
shall, insofar as necessary for the tasks and budget implementation delegated
under paragraph 1, lay down the general conditions for the management of the
funds entrusted to the European Space Agency, and, in particular, the actions
to be implemented, the relevant financing, management procedures and monitoring
and control measures, the measures applicable in the event of inadequate
performance of contracts and the rules regarding ownership of all tangible and
intangible property.

The monitoring and control measures, in
particular, shall provide for a provisional cost forecast system, systematic
information from the Commission on costs, and, in the event of a discrepancy
between the planned budgets and costs incurred, corrective action ensuring the
implementation of the infrastructures within the limits of the budgets
allocated.

3.           The Committee referred to
in Article 35(1) shall be consulted on the delegation decision referred to in
paragraph 1 of this Article, in accordance with the consultation procedure
referred to in Article 35(2). The Committee shall be informed of the
multiannual delegation agreement to be concluded by the Commission and the
European Space Agency.

4.           The Committee referred to
in Article 35(1) shall be informed by the Commission of the interim and end
results of the evaluation of the procurement tenders and of the contracts with
private sector entities to be concluded by European Space Agency.

CHAPTER IV

ASPECTS RELATING TO THE SECURITY OF THE UNION OR OF THE MEMBER
STATES

Article 17

Joint
Action

Whenever the security of the Union or its
Member States may be affected by the operation of the systems, the procedures
set out in Council Joint Action 2004/552/CFSP shall apply.

Article 18

Application
of the Regulation on classified information

1.           Each
Member State shall ensure that security regulations ensuring a degree of
protection at least equivalent to that guaranteed by the Commission's rules on
security set out in the Annex to Commission Decision 2001/844/EC, ECSC, Euratom[21] and by the security
regulations of the Council set out in the Annex to Council Decision 2011/292/EC[22] apply to all natural persons
resident on its territory and all legal entities established on its territory
which deal with Union classified information regarding the programmes.

2.           Member States shall
immediately inform the Commission of the adoption of the national security
regulation as referred to in paragraph 1.

3.           Natural persons resident
in third countries and legal entities established in third countries may deal
with Union classified information regarding the programmes only where they are
subject, in those countries, to a security regulation ensuring a degree of
protection at least equivalent to that guaranteed by the Commission's rules on
security set out in the Annex to Decision 2001/844/EC, ECSC, Euratom and
by the security regulations of the Council set out in the Annex to Decision
2011/292/EU. The security regulations of the European Space Agency and Decision
2011/C 304/05 of the High Representative of the Union for Foreign Affairs and
Security Policy[23]
shall be considered as equivalent to those rules and regulations. The
equivalence of the security regulation applied in a third country may be
recognised in an agreement with that country.

CHAPTER V

PUBLIC PROCUREMENT

SECTION I

General
provisions applicable to public procurement conducted as part of the deployment
and exploitation phases of the programmes

Article 19

General
principles

The Union's public procurement rules laid
down in Regulation (EC, Euratom) No 1605/2002, and in particular open access
and fair competition throughout the industrial supply chain, tendering on the
basis of the provision of transparent and timely information, clear
communication of the applicable procurement rules, selection and award criteria
and any other relevant information allowing a level-playing field for all
potential bidders, shall apply to the deployment phase of the Galileo programme
and the exploitation phases of the programmes without prejudice to measures
required to protect the essential interests of the security of the Union or
public security or to comply with Union export control requirements.

Article 20

Specific
objectives

During the procurement, the following
objectives shall be pursued:

a)      to promote the widest and most open
participation possible throughout the Union by all economic operators, in
particular by new entrants and SMEs;

b)      to avoid possible abuse of dominance
and long-term reliance on a single supplier;

c)      to take advantage of prior public
sector investments and lessons learned as well as industrial experience and
competences, including that acquired in the definition, development and validation
and deployment phases of the programmes, while ensuring that competitive
tendering rules are complied with.

SECTION 2

Specific
provisions applicable to public procurement conducted as part of the deployment
and exploitation phases of the programmes

Article 21

Establishing fair competition
conditions

The contracting authority must take
the appropriate measures to ensure fair competition conditions when previous
involvement of a company in activities associated with the subject of the call
for tender:

(a)
 may confer significant advantages on that
company in terms of privileged information and therefore may give rise to
concerns as to compliance with equal treatment; or

(b)
affect normal competition conditions or the
impartiality and objectivity of the award or performance of the contracts.

These measures must not distort fair
competition, equal treatment and confidentiality of data collected about
undertakings, their business relations and cost structure. In this context,
these measures shall take into account the nature and particulars of the
intended contract.

Article 22

Conditional stage-payment contracts

1.           The contracting authority
may award a contract in the form of a conditional stage-payment contract.

2.           A conditional
stage-payment contract includes a fixed stage which is accompanied by a
budgetary commitment and one or more conditional stages. The tender documents
refer to the specific features of conditional stage-payment contracts. In
particular, they specify the subject-matter of the contract, the price or the
arrangements for determining the price and the arrangements for provision of supplies
and services at each stage.

3.           The fixed stage
obligations must be part of a consistent whole; the same is true for the
obligations under each conditional stage, taking into account the obligations
under the previous stages.

4.           Performance of each
conditional stage is subject to a decision by the contracting authority,
notified to the contractor in accordance with the contract. When a conditional
stage is confirmed belatedly or is not confirmed, the contractor may benefit,
if the contract so provides and under the conditions laid down therein, from a
tideover allowance or a non-execution allowance.

Article 23

Cost-reimbursement contracts

1.           In exceptional circumstances,
the contracting authority may opt for a full or partial cost-reimbursement
contract up to a ceiling price, under the circumstances laid down in paragraph
2.

Unlike a contract which provides remuneration
for a result and for which the price or arrangements for determining the price
is fixed initially in the contractual documents, a cost-reimbursement contract
remunerates the resources used and not a finished product or service. The price
to be paid consists of reimbursement of all direct costs incurred by the
contractor in performing the contract, such as expenditure on labour,
materials, consumables, use of equipment and infrastructures necessary to
perform the contract. These costs are increased by a fixed fee covering
indirect costs and the profit, or a sum covering indirect costs and incentive
fee compensation based on achieving objectives in respect of performance and
delivery schedules.

2.           The contracting authority
may opt for a full or partial cost-reimbursement contract when it is objectively
impossible to specify an accurate fixed price and if it can be reasonably shown
that such a fixed price would be abnormally high due to the uncertainties
inherent in performance of the contract because:

(a)
either the contract has very complex features or
features which require the use of a new technology and, therefore, includes a
significant number of technical risks;

(b)
or the activities subject to the contract must,
for operational reasons, start immediately even though it is not yet possible
to determine a firm fixed price in full due to significant risks or because
performance of the contract depends in part on the performance of other
contracts.

3.           The ceiling price for a
full or partial cost-reimbursement contract is the maximum price payable. It
may only be exceeded in duly justified exceptional circumstances subject to
prior agreement by the contracting authority.

4.           The tender documents of a
procurement procedure for a full or partial cost-reimbursement contract shall
specify:

(a)
the type of contract, namely whether it is a
full or partial cost-reimbursement contract up to a ceiling price;

(b)
for a partial cost-reimbursement contract, the
elements of the contract subject to cost-reimbursement;

(c)
the total ceiling price;

(d)
the award criteria, which must enable evaluation
of the plausibility of the estimated overall budget, of the reimbursable costs,
of the mechanisms for determining these costs, and the profit referred to in
the tender to be evaluated;

(e)
the mechanics of the increase referred to in
paragraph 1 to be applied to direct costs;

(f)
the rules and procedures which determine the
eligibility of the costs planned by the tenderer for performance of the
contract, in accordance with the principles set out in paragraph 5;

(g)
the accounting rules with which tenderers must
comply;

(h)
in the case of a partial cost-reimbursement
contract to be converted into a firm fixed-price contract, the parameters for
this conversion.

5.           The costs declared by the
contractor during performance of a full or partial cost-reimbursement contract
are only eligible if:

(a)
they are actually incurred during the duration
of the contract, with the exception of costs for equipment, infrastructures and
intangible fixed assets necessary for performance of the contract which may be
deemed eligible for the whole of their purchase value;

(b)
they are referred to in the estimated overall
budget which may be revised by amendments to the initial contract;

(c)
they are necessary for performance of the
contract;

(d)
they result from the performance of the contract
and are attributable to this;

(e)
they are identifiable, verifiable, recorded in
the Contractor's accounting record and determined in accordance with the
accounting standards referred to in the specifications and in the contract;

(f)
they comply with the requirements of applicable
tax and social legislation;

(g)
they do not derogate from the terms of the
contract;

(h)
they are reasonable, justified, and comply with
the requirements of sound financial management, in particular regarding economy
and efficiency.

The contractor is responsible for its own cost
accounting, keeping sound accounting records or any other document required to
show that the costs for which reimbursement is requested have been incurred and
comply with the principles set out in this Article. Costs which cannot be substantiated
by the contractor shall be deemed ineligible and their reimbursement shall be
refused.

6.           The contracting authority
is responsible for the following tasks in order to ensure correct performance
of cost-reimbursement contracts:

(a)
it shall determine the most realistic possible
ceiling price, while providing the necessary flexibility to account for
technical difficulties;

(b)
it shall convert a partial cost-reimbursement
contract into a full firm fixed-price contract as soon as it is possible to
determine such a firm fixed-price during performance of the contract. For this
reason, it shall determine the conversion parameters to convert a contract
concluded on a cost-reimbursement basis to a firm fixed-price contract;

(c)
it shall implement monitoring and inspection
measures which provide, in particular, an estimated cost forecast system;

(d)
it shall determine suitable principles, tools
and procedures for the implementation of contracts, in particular for
identifying and checking the eligibility of costs declared by the contractor or
its subcontractors during performance of the contract, and for entering
amendments to the contract;

(e)
it shall check that the contractor and its
subcontractors comply with the accounting standards stipulated in the contract
and with the obligation to provide their accounting documents which should
present a true and fair view of the accounts;

(f)
throughout performance of the contract, it shall
ensure continuously the effectiveness of the principles, tools and procedures
referred to in point (e).

Article 24

Amendments

The contract may be changed by an amendment
on condition that this amendment fulfils all of the following conditions:

a)      it does alter the subject-matter of
the contract,

b)      it does disturb the economic balance
of the contract,

c)      it does not introduce conditions
which, if they had appeared initially in the contract documents, would have
allowed for the admission of tenderers other than those initially admitted or
would have allowed for the acceptance of a tender other than the one initially
accepted.

Article 25

Subcontracting

1.
The contracting authority may ask each tenderer
to subcontract part of the contract, at different levels, to companies which do
not belong to the group to which it belongs. This minimum sub-contracting section
is expressed as a range from a minimum to a maximum percentage. This range is
in proportion to the objective and value of the contract as well as the nature
of the sector of activity concerned, in particular, the competitive conditions
and industrial potential observed.

2.
The contracting authority may reject
subcontractors selected by the candidate at the stage of the main contract
award procedure or by the tenderer selected for the performance of the
contract. It shall justify this rejection in writing, which may only be based
on the criteria used for selection of tenderers for the main contract.

CHAPTER VI

MISCELLANEOUS
PROVISIONS

Article 26

Programming

The Commission shall lay down a multiannual
work programme setting out the key actions, provisional budget and schedule
required to meet the objectives of the Galileo and EGNOS programmes laid down
in Article 1(4) and (5).

On the basis of the multiannual work
programme, the Commission shall adopt an annual work programme that includes
the implementation plan for the multiannual programme and the corresponding
funding.

These implementing measures shall be
adopted in accordance with the assessment procedure referred to in Article
35(3).

Article 27

Member
States' action

1.           The Member States shall
not take measures which could harm the progress of the programmes, in
particular concerning intellectual property rights and the continuity of the
operation of the infrastructures.

2.           The Member States shall
take all necessary measures so that the systems' earth stations are designed as
European critical infrastructures within the meaning of Council Directive
2008/114/EC[24].

Article 28

International
agreements

The Union may enter into agreements with
third countries and international organisations in the context of the
programmes, in particular, cooperation agreements in accordance with the
procedure laid down in Article 218 of the Treaty on the Functioning of the
European Union.

Article 29

Technical
assistance

In order to complete the technical tasks
referred to in Article 13(2), the Commission may have recourse to the necessary
assistance, in particular the assistance of experts from the national agencies competent
in the space sector, independent experts and bodies capable of providing
impartial analyses and opinions on the progress of the programmes.

The bodies involved in the public
governance of the programmes, other than the Commission, in particular, the
European GNSS Agency and the European Space Agency, may also receive the same
technical assistance in performing the tasks entrusted to them under this
Regulation.

Article 30

Personal
data and privacy protection

1.           The Commission shall
ensure that personal data and privacy is protected during the design and
implementation of the systems and that the appropriate guarantees are included
therein.

2.           All personal data handled
in the context of the tasks and activities provided for in this Regulation
shall be processed in accordance with the applicable legislation on personal
data protection, in particular Regulation (EC) No 45/2001 of the European
Parliament and of the Council[25]
and Directive 95/46/EC of the European Parliament and of the Council[26].

Article 31

Protection
of the Union’s financial interests

1.           The Commission shall take
the appropriate measures to ensure that the financial interests of the Union
are protected when actions financed under this Regulation are implemented, by
the application of preventive measures against fraud, corruption and any other
illegal activities, by effective checks and, if irregularities are detected, by
the recovery of amounts unduly paid and, if necessary, by effective,
proportional and dissuasive penalties.

2.           The Commission or its
representatives and the Court of Auditors shall have the power of audit, on the
basis of document and on-the-spot checks, over all grant beneficiaries,
contractors and subcontractors who have received Union funds under this
Regulation.

The European Anti-fraud Office (OLAF) may carry
out on-the-spot checks and inspections on economic operators concerned directly
or indirectly by such funding in accordance with the procedures laid down in
Council Regulation (Euratom, EC) No 2185/96[27] with a view to establishing whether there has been
fraud, corruption or any other illegal activity affecting the financial interests
of the European Union in connection with a grant agreement or decision or a
contract concerning Union financing.

Without prejudice to the first and second
subparagraphs, international agreements with third countries and international
organisations, grant agreements, grant decisions and contracts resulting from
the application of this Regulation shall expressly entitle the Commission, the
Court of Auditors and OLAF to conduct these audits and these on-the-spot checks
and inspections.

Article 32

Information
to the European Parliament and to the Council

The Commission
shall ensure the implementation of this Regulation. Each year, when it presents
the preliminary draft budget, it shall present a report to the European
Parliament and to the Council on the implementation of the programmes.

Article 33

Review
of the implementation of this Regulation

1.           By 30 June 2018, the
Commission shall present an evaluation report to the European Parliament and
the Council, with a view to a decision being taken on the renewal, modification
or suspension of the measures taken pursuant to this Regulation concerning:

(a)
achieving the objectives of these measures, from
the point of view of both results and impacts;

(b)
effectiveness of the use of resources;

(c)
European added value.

The evaluation shall also address the scope for
simplification, its internal and external coherence, the relevance of all
objectives, as well as the contribution of the measures to the Union priorities
of smart, sustainable and inclusive growth. It shall take into account
evaluation results on the long-term impact of the previous measures.

2.           The evaluation will take
into account progress made with regard to the objectives of the Galileo and
EGNOS programmes laid down in Article 1(4) and (5) on the basis of the
following performance indicators:

(a)
for Galileo: the number of operational
satellites, the ground infrastructure version used and the number of services
provided;

(b)
for EGNOS: the number of changes to the service
specifications presented to the certification authorities.

3.           The bodies involved in the
implementation of this Regulation shall provide the Commission with the data
and information necessary to enable the actions concerned to be monitored and
evaluated.

CHAPTER VII

DELEGATION
AND IMPLEMENTING MEASURES

Article 34

Exercise
of the delegation

1.           The power to adopt
delegated acts is conferred on the Commission subject to the conditions laid
down in this Article.

2.           The power to adopt
delegated acts referred to in Articles 5 and 14 shall be conferred on the
Commission for an indeterminate period from 1 January 2014.

3.           The delegation of power
referred to in Articles 5 and 14 may be revoked at any time by the European
Parliament or by the Council. A decision to revoke shall put an end to the
delegation of the power specified in that decision. The revocation shall take
effect the day following the publication of the decision in the Official
Journal of the European Union or at a later date specified in the
abovementioned Decision. It shall not affect the validity of any delegated acts
already in force.

4.           As soon as it adopts a
delegated act, the Commission shall notify it simultaneously to the European
Parliament and to the Council.

5.           A delegated act adopted
pursuant to Articles 5 and 14 shall enter into force only if no objection has
been expressed either by the European Parliament or the Council within a period
of 2 months of notification of that act to the European Parliament
and the Council or if, before the expiry of that period, the European Parliament
and the Council have both informed the Commission that they will not object.
That period shall be extended by 2 months at the initiative of the European
Parliament or the Council.

Article 35

Committee
Procedure

1.           The Commission shall be
assisted by the Committee on European GNSS Programmes (hereinafter 'Committee')
set up by Article 19 of Regulation (EC) No 683/2008. That Committee is a
committee within the meaning of Regulation (EU) No 182/2011.

2.           Where reference is made to
this paragraph, Article 4 of Regulation (EU) No 182/2011 shall apply.

3.           Where reference is made to
this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.

4.           Representatives of the
European GNSS Agency and the European Space Agency may be involved as observers
in the work of the Committee under the conditions laid down in its rules of
procedure.

5.           International agreements
concluded by the Union in accordance with Article 28 may provide for the
involvement of representatives of third countries or international
organisations in the work of the Committee under the conditions laid down in
its rules of procedure.

CHAPTER VIII

FINAL
PROVISIONS

Article 36

Repeals

1.           Regulation (EC) No
876/2002 shall be repealed with effect from 1 January 2014.

Any measure adopted on
the basis of Regulation (EC) No 876/2002 shall continue to be governed by
that Regulation.

2.           Regulation (EC) No
683/2008 shall be repealed with effect from 1 January 2014.

Any measure adopted on
the basis of Regulation (EC) No 683/2008 shall continue to be governed by
that Regulation.

References to the
repealed Regulation shall be construed as references to this Regulation and
shall be read in accordance with the correlation table set out in the Annex
hereto.

Article 37

Entry
into force

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

It shall apply from 1 January 2014.

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

ANNEX

Correlation table

Former numbering (Regulation (EC) No 683/2008[28]) || New numbering (This Regulation)

Article 1 || Article 1

Article 2 || Article 2

Article 3 || Article 3

Article 4 || Article 8

Article 5 || Article 4

Article 6 || Article 9

Article 7 || Article 5

Article 8 || Article 6

Article 9 || Article 7

Article 10 || Article 10

Article 11 || Article 11

Article 12(1) Article 12(2) and (3) || Article 12 Article 13

Article 13(1) Article 13(2) and (3) Article 13(4) || Article 13 Article 14 Article 17

Article 14 || Article 18

Article 15 || Article 26

Article 16 || Article 15

Article 17 || Articles 19 to 25

Article 18 || Article 16

Article 19 || Article 35

Article 20 || Article 30

Article 21 || Article 31

Article 22 || Article 32

Article 23 ||

Article 24 || Article 37

Annex || Article 1

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
mode(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 operational appropriations

3.2.3. Estimated impact
on appropriations of an administrative nature

3.2.4. Compatibility
with the current multiannual financial framework

3.2.5. Third-party
contributions

3.3.    Estimated impact on revenue

LEGISLATIVE FINANCIAL STATEMENT

1.
FRAMEWORK OF THE PROPOSAL/INITIATIVE
1.1.
Title of the proposal/initiative

European satellite radio navigation programmes - GALILEO and EGNOS
(European Geostationary Navigation Overlay Service)

1.2.
Policy area(s) concerned in the ABM/ABB
structure[29]

Title 02: Company

Chapter 02 05: European satellite navigation programmes (EGNOS
and Galileo)

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[30]

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

 ̈ 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

It should be noted that the satellite navigation programmes
(hereinafter 'the programmes') are flagship projects of the Union. They form
part of the Europe 2020 strategy and policies for sustainable development. This
consists of providing navigation services, generating considerable developments
in numerous sectors of activity, driving technological innovation and growth of
competitiveness in the European economy and providing a source of job creation,
commercial revenue and socio-economic benefits.

The objective of the proposal consists of supporting European
presence in space and the development of satellite services and, more
specifically, providing two satellite navigation systems.

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.

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

Specific objective No 1

To develop and provide global satellite-based radio navigation
infrastructures and services (Galileo) by 2019

The specific objectives of the Galileo programme, as defined in the
proposal for the Regulation, are to ensure that the signals emitted by the
system under this programme can be used to fulfil the following five functions:

- to offer an open service (OS), which is free to the
user and provides positioning and synchronisation information intended for
high-volume satellite navigation applications,

- to offer a safety-of-life service (SoL) aimed at users
for whom safety is essential. This service also fulfils the requirements
of certain sectors for continuity, availability and accuracy and includes an
integrity function alerting the user to any failure in the system; research
will continue in order to redefine the SoL service in order better to meet user
requirements, reduce the impact of this service on costs and to take into
account complementarity with the EGNOS SoL service;

- to offer a commercial service (CS) for the development
of applications for professional or commercial use by means of improved
performance and data with greater added value than those obtained through the
open service,

- to offer a public regulated service (PRS) restricted to
government-authorised users, for sensitive applications which require a high
level of service continuity. The public regulated service uses strong,
encrypted signals,

- to participate in the search and rescue support service
(SAR) of the COSPAS-SARSAT system by detecting emergency signals emitted by
beacons and relaying messages to them.

Sub-objective N°1

To develop global satellite-based radio navigation infrastructures
and provide early Galileo services by 2014-2015

The objective of the Galileo programme is to offer the first three
initial services by 2014-2015 (OS, PRS and SAR)

Specific objective No 2

To provide satellite-based services improving the performance of GPS
to gradually cover the whole ECAC (European Civil Aviation Conference) region
by 2020 (EGNOS)

The EGNOS programme, which complements the signals of the
US GPS to provide users with a more precise positioning over the European area [31], aims to provide three
services:

—      the Open Service
(OS): for mass-market receivers and common user applications. It provides
freely accessible signals for positioning. It was declared operational[32] in October 2009 and is already
used in several sectors such as agriculture;

—      the Safety-of-Life
service (SoL): for safety-critical transport applications, in particular in civil
aviation. It provides enhanced and guaranteed performance and features an
integrity warning system. It was declared operational in March 2011 and is used
by aviation transport sectors in Europe;

—      the EGNOS Data Access Service
(EDAS), for enhanced applications, it provides terrestrial commercial data
service and is offered on a controlled access basis (e.g. through Internet or
mobile phones).

Sub-objective N°2

Taking the measures necessary to ensure continuity of the operations
after 2014 and gradually to improve the quality of services by 2020.

ABM/ABB activity(ies) concerned

Chapter 02 05: European satellite navigation programmes (EGNOS
and Galileo)

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 pursue 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 spill-over 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.

1.4.4.
Indicators of results and impact

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

Specific objective No 1

The Galileo programme aims to develop and provide global
satellite-based navigation infrastructures and services. In order to achieve
this objective, the infrastructure developed needs to be constantly maintained
and its component renewed if necessary.

Indicator related to Galileo infrastructure:

–        Cumulative number of operational satellites : 18 satellites
by 2015, 30 by 2019

–        Terrestrial infrastructure deployed version: v2 by 2015

Indicator related to Galileo services provision:

–        Number of services implemented : 3 initial services by
2015, 5 services by 2020

Specific objective No 2

The EGNOS programme aims to provide improved satellite-based
navigation services over Europe. Its infrastructure needs to be maintained to
its operational level and current coverage should be increased in order to
cover the whole of the European Union so that users can benefit from its
services without discrimination all over the Union.

Indicators associated with the quality of service provided and the
geographical extension of EGNOS.

–        Number of changes in services presented to the
certification authorities: 3 in 2014-2020.

These changes will be included in the documents setting out services
which are available to the public.

1.5.
Grounds for the proposal/initiative
1.5.1.
Requirement(s) to be met in the short or long
term

GNSS technologies, with their ability to provide highly reliable
accurate position, velocity and time data, are fundamental to improving
efficiency in many areas. The experience of the US GPS (Global Positioning
System) has demonstrated the advantages of satellite navigation to the extent
that it is regarded in the USA as the fifth utility, alongside water,
electricity, gas and telephone. The US military and civil users have developed
a considerable dependence on the GPS. Several other countries have also been
aware of their dependence and are now building their own Global Navigation
Satellite System (GNSS).

Nowadays satellite navigation users in Europe have no alternative
other than to use the satellite signals from the US GPS or GLONASS for
positioning and navigation. Consequently, the European economy is increasingly
relying on a military infrastructure not controlled by Europe and not primarily
designed to serve European economic purposes. Furthermore, the availability of
these systems is poor particularly in densely populated urban areas[33]. Also, they do not provide
sufficient guarantee for quality and continuity of service to European civilian
users.

From a political perspective, with GPS being fully operational in
the early 1990s, the European Union saw the need for Europe to have its own
global satellite navigation system[34].
Long before the wide dissemination of GNSS-based applications like Location
Based Services or in-car navigation, the Council and Parliament foresaw an
increased need for navigation aids. European independence in satellite
navigation was the primary driver behind this endeavour. This political vision
had the following goals:

•        To set up a first self-contained global satellite
navigation and positioning infrastructure under civilian control, which would
guarantee uninterrupted GNSS services and a strategic advantage for Europe.
However, as became clear later, interoperability with other systems, in
particular with the US GPS, would need to be pursued[35] to optimise the quality of the
services to be provided to users and maximise socio-economic benefits;

•        To reinforce the resilience of the European economic
infrastructure by providing a backup system in case of signal failure from
other systems;

•        To maximise indirect economic benefits for European civil
society relying on more accurate, available and robust signals by exploiting
the new opportunities generated by high-precision satellite navigation to a
much fuller extent than currently possible;

•        To demonstrate Europe's ability to develop, deploy and
operate complex large-scale space infrastructures.

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 on the further
implementation of the European satellite navigation programmes (EGNOS and
Galileo).

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.

Moreover, the GNSS Regulation provides that the European Union shall
be the owner of all tangible and intangible assets created or developed under
the programmes. As owner of all related tangible and intangible assets, the
European Union has to ensure that all the conditions for operating and
exploiting the systems are in place as of the date of introduction of the first
positioning services in 2014-2015. Therefore, the governance is de facto of
European nature.

1.5.3.
Lessons learned from similar experiences in the
past

Although it is the first time the Union is the sole owner of an
infrastructure of this scale and that the Commission manages such a complex
programme, the experience gained since 2007 enables greater improvements to the
further implementation of Galileo and EGNOS.

As described in its report from the Commission to the European
Parliament and Council on the Mid-term review of the European satellite
navigation programmes[36]
and in the proposal for a Regulation of the European Parliament and the Council
on the further implementation and operation of the European satellite
navigation programmes, the following lessons can be learned:

<Programme administration >

Following the re-profiling of the programmes undertaken in 2008, the
Commission has implemented a structure internally to manage the programmes in
their current phase. It has been possible to make considerable progress since then,
however the programme management must develop to enable more operational
functions associated with the operation of the systems to be incorporated.

From the point of view of the interaction between the various
stakeholders, principally the European Space Agency and the European GNSS
Agency, the new distribution of competences, the European Space Agency having
effectively become an implementing agency acting on behalf of the EU, is
delivering good results but it must adapt to the changing programmes and the
future challenges of the exploitation phase.

<Cost control and financial instruments>

Galileo and EGNOS are complex projects. Their development is
largely based on new bespoke technologies to satisfy the needs of the
programmes. As a result, it is difficult to have one single approach for
cost containment; several factors influence costs and a very large
number of risks could imperil the smooth progress of the programmes.

In the past, the programmes suffered from delays and cost overruns,
in particular due to increased security requirements from Member States. As
indicated in the Communication from the Commission "A budget for Europe
2020"[37]
and as requested by the Council and the European Parliament, continued and even
increased efforts are necessary to keep costs under control. This need has been translated into the new
governance framework and already today, the Commission acts to keep risks and
cost under control.

- All the risks relating to the programmes are recorded centrally in
a register listing, in turn, those associated with the industrial supply chain,
the European Space Agency, the European GNSS Agency, external factors such as
the influence of political authorities and security requirements, and internal
factors such as the organisation of the programmes. Each risk is
allocated a degree of probability and an impact rating. The risk
register also includes a list of measures intended to reduce the probability of
a risk materialising;

- The Commission is studying a possible re-design of the SoL service
to reduce its impact on overall cost;

- It is also working on providing efficient management of the
programmes, which should prevent future drifts and developing solid governance
scheme for the future;

The Commission, together with the European Space Agency, is putting
pressure on industry to contain the prices of the various elements of the
Galileo infrastructure;

- Additional measures are also taken at programme level to control
costs e.g. optimised contract length, new procurement for the purchase of
additional satellites, double sourcing for launchers;

- Finally, the Commission is working on enhancing its cooperation
with experts (independent and from Member States) to analyse the technical
requirements of the systems, their associated costs and possible alternatives.

<Security requirements>

Finally, where security is concerned, it needs to be remembered
that, while the Commission is responsible for the management and security of
the systems under the Regulation, its freedom is constrained in this area in
two ways:

- First, in reality it is the Member States which define security
needs. The threats which might affect the security of sensitive infrastructure
such as that supporting satellite navigation are constantly changing. The
design of the systems must constantly adapt to those changes. Covering part of
such risks is a matter for the Member States.

- Secondly, the current GNSS Regulation (EC) No 683/2008 assigns
responsibility for accrediting the security of systems to the EU Agency. Separating
the functions of management and accreditation in this way reflects good
governance, and is standard practice and essential for this type of project.

In both cases the choices made or the decisions taken may have a
considerable impact on the programmes' costs and schedules.

Considering the impact of security requirements on costs and delays,
the Commission emphasises the importance of changing the governance framework
of the programmes and giving more responsibilities to the different
stakeholders (in particular to their contractors and through the general terms
of the delegation agreements).

1.5.4.
Coherence and possible synergy with other
relevant instruments

Synergies are possible with other existing or future space
programmes, e.g. for expansion of user segments (applications for the
downstream market) or for protection of elements of the system established
under the Galileo programme in space or during launching.

Synergies shall also be sought within the other directorates of the
European Commission regarding research and innovation. GNSS-based applications
and technologies used in satellite navigation systems can impact various
sectors of the economy and of society such as information, transport and
energy. It is important to ensure that research and innovation programmes are
coordinated by the Commission to maximise the return on investment.

1.6.
Duration and financial impact

 ̈ Proposal/initiative of limited duration

 ̈         Proposal/initiative in effect from [] to []

 ̈         Financial impact from 2014 to YYYY

þ Proposal/initiative of unlimited
duration[38]

–
Implementation with a start-up period from 2008
to 2020,

–
followed by full-scale operation

1.7.
Management mode(s) envisaged[39]

þ Centralised direct management by the Commission

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

–
 ̈  executive agencies

–
þ  bodies set up by the Communities[40]

–
þ  national public-sector bodies/bodies with a public-service mission[41]

–
þ  international organisations[42]

–
 ̈  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

 ̈ Shared management with the Member States

 ̈ Decentralised management with third countries

 ̈ 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.

For the
exploitation phase of Galileo 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 and
exploitation phase safeguarding continuity of service. The governance shall
also be tailored to the different services offered, as their requirements and
users are different.

The
European Commission will be responsible mainly for the overall political
supervision of the programmes. It will be able to delegate the management of
operational activities to the European GNSS Agency and to the European Space
Agency, according to their area of competence.

It will
also be able to consult with experts and National Space Agencies on specific
technical questions.

2.
MANAGEMENT MEASURES
2.1.
Monitoring and reporting rules

Specify frequency
and conditions.

The Commission will ensure that all contracts and
agreements concluded in the framework of the GNSS programmes will provide for
supervision and financial control. Particular focus in all monitoring and
evaluation mechanisms will be on containing programmes' cost while delivering
the services on schedule.

If need be, assistance of external technical experts will
be requested when monitoring the implementation of the programmes. On the basis
of the results of on-the-spot checks, the Commission will ensure that, if
necessary, the scale or the conditions of allocation of the financial
contribution originally approved and also the timetable for payments are
adjusted.

The Commission will propose:

- a strategic framework including main actions, estimated
budget and time-table necessary to meet the objectives of Galileo and EGNOS
programmes at latest by 30 June 2014;

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

- an annual implementation report evaluating the
fulfilment of the annual work programme to be proposed at latest by 15 March of
the following year example;

- an interim evaluation of the Galileo and EGNOS
programmes focusing on quantitative and qualitative results so far achieved by
30 June 18 in due time for preparation of the next multi-annual financial
framework.

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

In addition, the monitoring of the programmes should
associate Member States for example by relying on their technical capabilities
to provide input on technical monitoring of the programmes and on proposing key
performance indicators against which the programmes will be evaluated.

Finally, in the day-to-day management, the Commission
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 Commission has placed the issue of risk management, the
importance of which was highlighted when the governance reform took place in
2007, at the heart of its work. All the risks relating to the programmes are
recorded centrally in a register listing, in turn, those associated with the
industrial supply chain, ESA, the EU Agency, external factors such as the
influence of political authorities and security requirements, and internal
factors such as the organisation of the programmes. Each risk is allocated a
degree of probability and an impact rating. The risk register also includes a
list of measures intended to reduce the probability of a risk materialising.
The risks are classified as follows:

• Technological risks: satellite navigation uses leading-edge
technology which has yet to be validated and the specifications of which are
constantly evolving.

• 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.

• Market risk: what has to be avoided is a technical performance
that is inferior to that promised having a negative effect among users
worldwide, and the infrastructure not being used as a result. In addition, the
availability of reliable receivers as from 2014-2015 must be ensured for the
various initial services to be offered by Galileo, especially the PRS.

• Timetable risk: any delay in implementation would jeopardise the
window of opportunity and would be likely to generate cost over-runs.

• Governance risk: governance of the programmes requires various
bodies to work together, and an appropriate degree of stability and
organisation has to be guaranteed. Moreover, differences of opinion between the
various parties involved, and in particular between the Member States, have to
be taken into account on several major issues. In this context the sharing of
some risks, including financial and security-related risks, among those players
who are best placed to cope with them, should be considered.

• Liability-related risk: as with any infrastructure the two
European systems may cause direct or indirect losses to their users or to third
parties. The analysis carried out by the Commission reveals that the current
state of law applicable does not provide an appropriate legal framework ensuring
a fair balance between the interests of the victims and those of the owners and
operators of the European satellite radio navigation systems. Appropriate
initiatives must therefore be taken, both in Europe and worldwide, to remedy
this situation by 2014. The Commission is carrying out studies in this
connection, in collaboration with other international bodies.

2.2.2.
Control method(s) envisaged

The majority of funds are managed indirectly via delegation
agreements. It is very important to know that the GNSS budget is implemented
through tenders. The internal control methodology relies on the ex ante control
of contract procedures (evaluation and selection of the contractor) as well as
monitoring of transactions performed under the delegation agreements and the
management plans for projects which have defined the roles of all stakeholders
and implemented specific procedures for workflows and control activities. In
particular, this concerns:

- Participation in regular meetings (management & technical)

- Compulsory quarterly reporting with the state of play of the
programme has been put in place.

- The obligation to draw up quarterly reports on the use of
community funds with clear indications of use by means of contracts signed with
industrial parties and updating of the valued assets.

Moreover, concerning contracts, the contract methodology is not
going to be changed: It is principally based on the performance of technical
stages legally associated with contract payments.

The administrative tasks of the Commission are to follow-up the
payments made by the delegated agent to industry through the above mentioned
reporting. A minimal team of around 5-10 FTEs is needed to control the
administrative and technical implementation of the delegated agreements. The Commission
will ensure that there will be no dual financing of certain elements under the
framework programme for research and innovation, Horizon 2020.

Moreover, as described in paragraph 1.5.3, the Commission has
developed a risk register to monitor potential elements which could influence
the programmes.

Finally, as stated in [Article 29 of the Regulation], the entities
in charge of the programmes' management will have access to the necessary
technical assistance.

Due to the very technical and specialised nature of the GNSS
programmes, major changes are not expected in the checks carried out.

We expect the non-compliance rate to be equivalent to the current
rate. In fact, each year ex post audits are initiated to check transactions
from the preceding year. The error rate is less than 1% for 2009 (financial
adjustment recommended as a percentage of the total amount paid). This rate
will be called upon to be lowered in view of the recommendations made to the
European Space Agency by the auditors. In view of the nature of the contracts,
this rate could be extrapolated to the whole of the GNSS budgets.

2.3.
Measures to prevent fraud and irregularities

Specify existing or
envisaged prevention and protection measures.

Agreements resulting from this Regulation, including agreements
concluded with participating third countries and international organisations,
shall provide for supervision and financial control by the Commission, or any
representative authorised by it, and audits by the Court of Auditors or OLAF,
if necessary on-the-spot.

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 || Contribution

|| Diff./non-diff. ([43]) || from EFTA countries[44] || from candidate countries[45] || from third countries[46] || within the meaning of Article 18(1)(aa) of the Financial Regulation

[1] || 02010405 European satellite navigation programmes (EGNOS and Galileo) — Expenditure on administrative management || Non-diff. || YES || NO || YES || NO

[1] || 020501 European satellite navigation programmes (EGNOS and Galileo) || Diff || YES || NO || YES || 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 || Contribution

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

[1] || 020503 Completion of the European satellite navigation programmes (EGNOS and Galileo) || Diff || YES || NO || YES || NO

3.2.
Estimated impact on expenditure
3.2.1.
Summary of estimated impact on expenditure

EUR million (to 3rd decimal place)

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

DG: Company || || || Year 2014 || Year 2015 || Year 2016 || Year 2017 || Year 2018 || Year 2019 || Year 2020 || Year 2021 || Year 2022 || Year 2023 - 2030 || TOTAL

Ÿ Operational appropriations || || || || || || || || || || ||

020501 || Commitments || (1) || 1 163.5 || 1 187.5 || 990.25 || 1 010 || 799.75 || 1 049.5 || 1 668 || 0 || 0 || 0 || 7 868.5

Payments || (2) || 1 011.5 || 1 181.5 || 955.25 || 1 011 || 672.75 || 1 010.5 || 898 || 500 || 480 || 148 || 7 868.5

Appropriations of an administrative nature financed  from the envelope of specific programmes[47] || || || || || || || || ||

02010405 || || (3) || 3.5 || 3.5 || 3.75 || 4 || 4.25 || 4.5 || 5 || 0 || 0 || 0 || 28.5

TOTAL appropriations for DG Enterprise || Commitments || =1+1a +3 || 1 167 || 1 191 || 994 || 1 014 || 804 || 1 054 || 1 673 || 0 || 0 || 0 || 7 897

Payments || =2+2a +3 || 1 015 || 1 185 || 959 || 1 015 || 677 || 1 015 || 903 || 500 || 480 || 148 || 7 897

Ÿ TOTAL operational appropriations || Commitments || (4) || x || || || || || || ||

Payments || (5) || x || || || || || || ||

Ÿ TOTAL appropriations of an administrative nature financed from the envelope for specific programs || (6) || x || || || || || || ||

TOTAL appropriations under HEADING <....> of the multiannual financial framework || Commitments || =4+ 6 || x || || || || || || ||

Payments || =5+ 6 || x || || || || || || ||

If more than one heading is affected by the proposal /
initiative:

Ÿ TOTAL operational appropriations || Commitments || (4) || || || || || || || ||

Payments || (5) || || || || || || || ||

Ÿ TOTAL appropriations of an administrative nature financed from the envelope for specific programs || (6) || || || || || || || ||

TOTAL appropriations under HEADINGS 1 to 4 of the multiannual financial framework (Reference amount) || Commitments || =4+ 6 || || || || || || || ||

Payments || =5+ 6 || || || || || || || ||

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

EUR million (to 3rd decimal place)

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

DG: ENTR ||

Ÿ Human resources || 9.773 || 9.773 || 9.773 || 9.773 || 9.392 || 8.884 || 8.884 || 66.252

Ÿ Other administrative expenditure || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 5.950

TOTAL DG ENTR || Appropriations || 10.623 || 10.623 || 10.623 || 10.623 || 10.242 || 9.734 || 9.734 || 72.202[48]

TOTAL appropriations under HEADING 5 of the multiannual financial framework || (Total commitments = Total payments) || 10.623 || 10.623 || 10.623 || 10.623 || 10.242 || 9.734 || 9.734 || 72.202

EUR million (to 3 decimal places)

|| || || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || 2021 || 2022 || 2023-2030 || TOTAL

TOTAL appropriations under HEADINGS 1 to 5 of the multiannual financial framework || Commitments || 1 177,623 || 1 201,623 || 1 004,623 || 1 024,623 || 814,242 || 1 063,734 || 1 682,734 || 0,000 || 0,000 || 0,000 || 7 969,202

Payments || 1 025,623 || 1 195,623 || 969,623 || 1 025,623 || 687,242 || 1 024,734 || 912,734 || 500,000 || 480,000 || 148,000 || 7 969,202

3.2.2.
Estimated impact on operational appropriations

 ̈         The proposal/initiative does not require the use of
operational appropriations

þ         The proposal/initiative requires the use of operational
appropriations, as explained below:

Commitment appropriations in EUR million (to 3 decimal
places)

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

OUTPUTS

Type of output[49] || “—” of the output || Number of outputs || Costs || Number of outputs || Costs || Number of outputs || Costs || Number of outputs || Costs || Number of outputs || Costs || Number of outputs || Costs || Number of outputs || Costs || Total no || Total Costs

SPECIFIC OBJECTIVE No 1[50] To develop and provide global satellite-based radio navigation infrastructures and services (Galileo) || || || || || || || || || || || || || || || ||

Galileo || 5 servic5 services || N/A || 3 || 930.5 || 3 || 942.5 || 3 || 744.25 || 3 || 763 || 3 || 552.75 || 3/5 || 802.5 || 5 || 1 421 || 5 || 6 156,5

Sub-total for specific objective N°1 || || 930,5 || || 942.5 || || 744.25 || || 763 || || 552.75 || || 802.5 || || 1 421 || || 6 156.5

SPECIFIC OBJECTIVE No 2[51] To provide satellite-based services improving the performance of GPS over Europe (EGNOS) || || || || || || || || || || || || || || || ||

EGNOS || 3 servic5 services || N/A || 3 || 233 || 3 || 245 || 3 || 246 || 3 || 247 || 3 || 247 || 3 || 247 || 3 || 247 || 3 || 1 712

Sub-total for specific objective N°2 || || 233 || || 245 || || 246 || || 247 || || 247 || || 247 || || 247 || || 1 712

TOTAL COST || N/A || 1 163,5 || N/A || 1 187.5 || N/A || 990.25 || N/A || 1 010 || N/A || 799.75 || N/A || 1 049.5 || N/A || 1 668 || N/A || 7 868.5

3.2.3.
Estimated impact on appropriations of an
administrative nature
3.2.3.1.
Summary

 ̈         The proposal/initiative does not require the use of
administrative appropriations

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

EUR million (to 3
decimal places)

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

HEADING 5 of the multiannual financial framework || || || || || || || ||

Human resources || 9.773 || 9.773 || 9.773 || 9.773 || 9.392 || 8.884 || 8.884 || 66.252

Other administrative expenditure || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 0.850 || 5.950

Subtotal HEADING 5 of the multiannual financial framework || 10.623 || 10.623 || 10.623 || 10.623 || 10.242 || 9.734 || 9.734 || 72.202

Outside heading 5[52] of the multiannual financial framework || || || || || || || ||

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

Other expenditure of an administrative nature || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0

Subtotal outside HEADING 5 of the multiannual financial framework || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0

TOTAL || 10.623 || 10.623 || 10.623 || 10.623 || 10.242 || 9.734 || 9.734 || 72.202

3.2.3.2.
 Estimated requirements of human resources

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

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

Estimate to be expressed in full amounts
(or at most to one decimal place)

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

Ÿ Establishment plan posts (officials and temporary agents)

02 01 01 01 (Headquarters and Commission’s Representation Offices) || 63 || 63 || 63 || 63 || 60 || 56 || 56

02 01 01 02 (Delegations) || 0 || 0 || 0 || 0 || 0 || 0 || 0

02 01 05 01 (Indirect research) || 0 || 0 || 0 || 0 || 0 || 0 || 0

10 01 05 01 (Direct research) || 0 || 0 || 0 || 0 || 0 || 0 || 0

Ÿ External personnel (in Full Time Equivalent unit: FTEs[53]

02 01 02 01 (CA, INT, SNE from the "global envelope") || 26 || 26 || 26 || 26 || 26 || 26 || 26

02 01 02 02 (CA, INT, JED, LA and SNE in the delegations) || 0 || 0 || 0 || 0 || 0 || 0 || 0

02 01 04 aa [54] || - at headquarters[55] || 0 || 0 || 0 || 0 || 0 || 0 || 0

- in delegations || 0 || 0 || 0 || 0 || 0 || 0 || 0

02 01 05 02 (CA, INT, SNE - Indirect research) || 0 || 0 || 0 || 0 || 0 || 0 || 0

10 01 05 02 (CA, INT, SNE - Direct research) || 0 || 0 || 0 || 0 || 0 || 0 || 0

Other budget lines (specify) || N/A || N/A || N/A || N/A || N/A || N/A || N/A

TOTAL || 89 || 89 || 89 || 89 || 86 || 82 || 82

XX is the policy area or budget title
concerned.

Description of
tasks to be carried out:

The human resources requirements will be
met by staff from the DG who are already assigned to management of the activity
and/or have been redeployed within the DG, together, if necessary, with any
additional allocation which may be granted to the managing DG under the annual
allocation procedure and in the light of budgetary constraints. DG ENTR
envisages a partial outsourcing process to an existing agency. Amounts and allocations
will be adjusted if necessary according to the results of the outsourcing
process.

Officials and temporary agents || - Supervise the implementation of the European GNSS programmes aiming at efficient and coherent deployment and exploitation of EGNOS and Galileo; - Provide legal and regulatory analysis to support the policy-making process; - Ensure the compliance of proposed solutions with the applicable rules; - Guarantee sound financial management; - Perform activities required to ensure efficient cost control; - Manage activities related to international cooperation

External personnel || Support the tasks described above

3.2.4.
Compatibility with the current multiannual
financial framework

þ         The proposal/initiative is compatible with the multiannual
financial framework 2014-2020, in accordance with Commission Communication
COM(2011)500 of 29 June 2011.

 ̈         Proposal/initiative will entail reprogramming of the
relevant heading in the multiannual financial framework.

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

–
 ̈  Proposal/initiative requires application of the flexibility
instrument or revision of the multiannual financial framework[56].

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

3.2.5.
Third-party contributions

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

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

Some negotiations are currently ongoing
with Switzerland and Norway, but no formal agreement has taken place yet and
should not be taken in the short term. Therefore, no third party contribution
can be taken into account at this stage. It should be noted that these
countries will not cofinance the GNSS programmes directly as such (and so there
will be no additional appropriation via revenues assigned from the Union
budget) but will make an external contribution.

Appropriations in EUR million (to 3 decimal places)

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

Specify the co-financing body || || || || || || || ||

TOTAL appropriations cofinanced || || || || || || || ||

3.3.
Estimated impact on revenue

–
 ̈  Proposal/initiative has no financial impact on revenue.

No revenue is expected before the
completion of the constellation insofar as the performances of the initial
services offered will not be in line with the expectations of potential users
before full deployment of the infrastructures.

By that time the way to manage the fees
should have been analysed in order to define the entity that will collect the
revenues (private / public), the exact types of revenues and the amount of
these potential revenues.

–
þ  Proposal/initiative has the following financial impact:

–
 ̈         on own resources

–
þ         on miscellaneous revenue

EUR million (to 3 decimal places)

Budget revenue line: || Appropriations available for the ongoing budget year || Impact of the proposal/initiative[57]

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

|| || p.m. || p.m. || p.m. || p.m. || p.m. || p.m. || p.m.

For miscellaneous assigned revenue, specify the budget expenditure
line(s) affected.

Specify the method for calculating the impact
on revenue.

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

[2]               COM(2011) 5 final

[3]               COM(2011) 500 final. A
Communication from the Commission to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions: a
Budget for Europe 2020;

[4]               COM(2011) 398 final. Proposal for a Council
Regulation laying down the multiannual financial framework for the years
2014-2020

[5]               COM(2010) 308

[6]               OJ L 246, 20.7.2004, p. 30.

[7]               OJ C , , p. .

[8]               OJ C , , p. .

[9]               COM(2010) 614 final/2

[10]             COM(2011) 152

[11]             OJ L 248, 16.09.02, p. 1.

[12]             COM(2011) 398 final.

[13]             COM(2011) 500 final.

[14]             OJ L 276, 20.10.10, p. 1.

[15]             OJ L 246, 20.7.2004, p. 30.

[16]             OJ L 201, 03.08.10, p. 30.

[17]             OJ L 55, 28.02.11, p. 13.

[18]             OJ L 196, 24.7.2008, p.1

[19]             OJ L 138, 28.05.02, p. 1.

[20]             OJ L 287, 04.11.11, p. 1.

[21]             OJ L 317, 03.12.01, p. 1.

[22]             OJ L 141, 27.05.11, p. 17.

[23]             OJ C 304, 15.10.2011, p. 7.

[24]             OJ L 345, 23.12.08, p. 75. .

[25]             OJ L 8, 12.01.01, p. 1.

[26]             OJ L 281, 23.11.95, p. 31.

[27]             OJ L 292, 15.11.96, p. 2.

[28]             OJ L 196, 24.07.08, p. 1.

[29]             ABM: Activity-Based Management – ABB: Activity-Based
Budgeting.

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

[31]             The European area for the EGNOS system is the area of
44 member states of the European Civil Aviation Conference.

[32]             EGNOS
Service Definition Document - Open Service: http://ec.europa.eu/enterprise/policies/satnav/egnos/files/brochures-leaflets/egnos-os-sdd_en.pdf

[33]             Study into the impact on capability of UK commercial
and domestic services resulting from the loss of GPS signals (2001): http://www.ofcom.org.uk/static/archive/ra/topics/research/topics/other/gpsreport/gps-report.pdf

[34]             Council Resolution on the European contribution to the
development of a Global Navigation Satellite System (GNSS) of 19 December 1994.

[35]             International Agreement of June 2004 on the promotion,
provision and use of Galileo and GPS satellite-based navigation systems and
related applications

[36]             COM(2011) 5 final.

[37]             COM(2011) 500 final.

[38]             Galileo programme is composed by 4 phases: definition,
development, deployment and exploitation. The deployment phase will be ended in
2019. The full exploitation phase will be on-going and therefore beyond 2020,
the exploitation of the system and the replenishment of the constellation will
continue for years to avoid any disruption of the services.

[39]             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

[40]             As referred to in Article 185 of the Financial
Regulation. GSA will be involved in the GNSS programmes governance.

[41]             European National Space Agencies.

[42]             ESA (European space Agency)

[43]             Diff. = Differentiated appropriations / Non-diff. =
Non-Differentiated Appropriations

[44]             EFTA: European Free Trade Association. Negotiations
will be carried out with Norway to participate to the budget 2014-2020

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

[46]             Negotiations are on-going with Switzerland to
participate to the budget 2014-2020.

[47]             Technical and/or administrative assistance and
expenditure in support of the implementation of EU programmes and/or actions
(former "BA" lines).

[48]             The reduction in human resources directly linked to the
new governance and to the allocation of tasks associated with the operation of
systems to the European GNSS Agency will be presented in detail during the
revision of Regulation 912 of the Agency. It is expected that the technical
expertise currently provided by the Commission will be be transferred to the
Agency insofar as required in order to enable performance of the tasks assigned
to it.

[49]             Outputs are products and services to be supplied (e.g.:
number of student exchanges financed, number of km of roads built, etc.).

[50]             As described in Section 1.4.2. "Specific
objective(s)..."

[51]             As described in Section 1.4.2. "Specific
objective(s)..."

[52]             Technical and/or administrative assistance and
expenditure in support of the implementation of EU programmes and/or actions
(former "BA" lines), indirect research, direct research.

[53]             CA= Contract Agent; INT= agency staff
("Intérimaire"); JED= "Jeune Expert en Délégation" (Young
Experts in Delegations); LA= Local Agent; SNE= Seconded National Expert;

[54]             Under the ceiling for external personnel from
operational appropriations (former "BA" lines).

[55]             Essentially for Structural Funds, European Agricultural
Fund for Rural Development (EAFRD) and European Fisheries Fund (EFF).

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

[57]             As regards traditional own resources (customs duties,
sugar levies), the amounts indicated must be net amounts, i.e. gross amounts
after deduction of 25% for collection costs.