EUROPEAN COMMISSION Strasbourg, 15.2.2022 COM(2022) 57 final 2022/0039(COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing the Union Secure Connectivity Programme for the period 2023-2027 {SEC(2022) 77 final} - {SWD(2022) 30 final} - {SWD(2022) 31 final}



EXPLANATORY MEMORANDUM 1. CONTEXT OF THE PROPOSAL •Reasons for and objectives of the proposal The general objective of this proposal is to establish a Union secure satellite communication system (hereafter the ‘Programme’) that ensures the provision of worldwide secure, flexible and resilient satellite communication services to the Union and Member States governmental entities. Satellite communications provide ubiquitous coverage, which is complementary to terrestrial networks (ground-based in a form of cable links such as fibre broadband or wireless). Satellite communications can provide the means for seamless digital communication in areas where terrestrial networks are absent (e.g. oceans, during flights, or in remote locations / islands with no cellular or broadband coverage), have been destroyed (e.g. during flooding events, or forest fires) or where local networks cannot be trusted (in crisis situations, or for diplomatic services in third countries or for sensitive governmental operations). Govsatcom is a strategic asset, closely linked to national security, used by most Member States. Public users tend to favour either government-owned or public-private solutions or make use of specific accredited private providers. Use cases include surveillance operations, crisis management, including civil protection and humanitarian operations in natural or human-made disasters and connection and protection of key infrastructure. Because of the scale and complexity of required investments, and the synergies that a common capability could bring, Govsatcom has been identified as early as 2013 as a promising field for Union initiatives, with the possibility of tangibly contributing to the objectives for a strong, secure and resilient European Union. It is now an integral part of the Space Strategy for Europe, the European Defence Action Plan and the European Union Global Strategy. The notion of a Union governmental satellite communication infrastructure has been consistently welcomed in ensuing Council conclusions. The adoption of the European Parliament and of the Council of 28 April 2021 establishing the Union Space Programme and the European Union Agency for the Space Programme and repealing Regulations (EU) No 912/2010, (EU) No 1285/2013 and (EU) No 377/2014 and Decision No 541/2014/EU (hereinafter referred to as ‘Space Regulation’) constituted a first step towards this resilience objective, through the establishment of a dedicated GOVSATCOM component of the Union Space Programme. Its aim is to optimise the use of existing satellite communication capacity for governmental users on the basis of pooling and sharing of available national and private EU satellite communication resources. Due to the limited lifespan of a satellite (approximately 15 years for geostationary orbit (GEO) satellites) several of the governmentally owned infrastructures that will constitute part of the pooling and sharing of GOVSATCOM will need to be replenished in the coming decade. For this reason, Regulation (EU) 2021/696 foresaw the need to assess the evolution of satellite communication needs. According to the Regulation, if this assessment ‘reveals that this approach is insufficient to cover the evolving demand, it should be possible to take a decision to move to a second phase and develop additional bespoke space infrastructure or capacities through one or several public-private partnerships, e.g. with Union satellite operators.’ Several studies have substantiated this evolution of needs: Traditionally, satellite communication has been used for voice communication and data transfer in remote areas (e.g. at sea), but the nature of use cases is rapidly evolving, requiring low latency performance and global coverage. While satellite communication has been primarily relying on geosynchronous (GEO) spacecraft, technical progress has allowed the emergence of non- geostationary-orbit (NGSO) communications constellations, comprising low-Earth-orbit (LEO) and medium-Earth-orbit (MEO) satellites to emerge and to offer performance meeting these evolving user needs. The increasing hybrid and cyber threat levels and the propensity of natural disasters drive the changing needs of governmental actors towards higher security, reliability and availability of commensurate satellite communication solutions. The rise of quantum computers adds an additional threat. With their fundamentally improved capabilities, it is expected that quantum computers will be able to decrypt content that is currently encrypted. The European Quantum Communication Infrastructure (EuroQCI) initiative aims at developing future-proof cryptographic systems to offer unprecedented levels of secure communications by resisting future quantum computing attacks. EuroQCI is currently financed through Horizon Europe, the Digital Europe programme, as well as the Connecting Europe Facility - Digital. Furthermore, the Commission Strategic Foresight report identifies digital hyper-connectivity and technological transformation as one of the prevalent megatrends of the next half century, underpinned by an unprecedented demand for services, for example in data economy and finance. These advances lead global satellite communication connectivity to be increasingly handled as a strategic asset. To that end, several major non-EU government-backed projects with a variety of connectivity strategic objectives are underway. These strategic infrastructures initiated by all major space powers highlight the growing global need for governmental services to ensure a resilient connectivity to support not only their security operations, but also to connect critical infrastructures, manage crises as well as to support border and maritime surveillance. To date, there are no operational or in-the-making EU assets in low Earth orbit (LEO) or medium Earth orbit (MEO) that could meet the evolving governmental user needs. The existing committed satellite communication capacities providing governmental services at the disposal of the Member States are all based on a reduced number of GEO assets, covering mainly Europe. The majority of the capacity is dedicated to military missions, with a strong governance control (from owned infrastructure to stringent public private partnerships). Moreover, as the services provided by these Milsatcom capabilities are tailored to meet specific mlitary needs, in particular in terms of frequency, encryption, signal specificities, user terminal and level of classification, they cannot be used in most civilian governmental applications. Spurred by the technological progress of low latency, there has been an emergence of various public-supported or subsidised non-EU mega-constellations in the US, China and Russia. At the same time, there is shortage of available frequency filings and orbital slots due to the dramatic increase of these mega-constellations. Coupled with the limited lifetime of GOVSATCOM capacity, this creates an urgency for an EU space-based secure connectivity system. The Programme would cover the capacity and capability gaps for governmental satellite communication services. The Programme should also allow for the provision of commercial satellite communication services by the private sector. Such commercial services would in particular enable availability of high-speed broadband and seamless connectivity throughout Europe, removing dead zones and increasing cohesion across Member State territories, including rural, peripheral, remote and isolated areas and islands, and provide connectivity over geographical areas of strategic interest outside the Union. A public-private partnership was assessed in the impact assessment to be the most appropriate implementation model to ensure that the objectives of the Programme could be pursued. It would permit to build upon the existing EU satellite communication technological and infrastructural base and to provide robust and innovative governmental services. At the same time, it would allow the private partners to complement the Programme infrastructure with additional capabilities to offer commercial services. This would furthermore optimise deployment and operation costs by sharing development and deployment costs on components common to both governmental and commercial infrastructures, as well as operational costs by allowing a high level of capacity mutualisation. It would stimulate innovation in particular for small and medium-sized enterprises and start-ups that deploy novel space technologies and applications (‘New Space’) by enabling the sharing of research and development risks between public and private partners. In parallel with this programme: ·the Horizon Europe Programme will allocate a dedicated share of its Cluster 4 components to R&I activities enabling the sharing of research and development risks between public and private partners, including for the potential technologies that would be developed under New Space; ·the Neighbourhood, Development and International Cooperation Instrument (NDICI) will allocate a dedicated share of the Global Europe activities enabling the sharing of the deployment and exploitation risks between public and private partners for the connectivity system that will allow to offer an array of services with accrued benefits to international partners;

·the Union Space Programme will allocate a dedicated share of its GOVSATCOM component for the activities related to the development of the GOVSATCOM Hub which will form part of the ground infrastructure of the Secure Connectivity system. •Consistency with existing policy provisions in the policy area The proposed Programme is consistent with the existing EU space policy. In particular, the programme would enhance the EU’s space capacity, currently consisting of the EU’s satellite navigation and Earth observation systems, Galileo and Copernicus respectively as well as the Space Situational Awareness capacities. The Programme builds on the EU GOVSATCOM component of the Union space programme. •Consistency with other Union policies The proposal is consistent with a number of other Union policies. In particular, the provision of governmental services would ensure further cohesion in line with the Union’s Digital and Cybersecurity Strategies, by ensuring the integrity and resilience of the European infrastructure, networks and communications. The Programme would be EU-operated and provide a very high level of security, hereby strengthening the ability to provide an integrated EU response to security threats as called for in the EU Security Union Strategy and in the Global strategy for the European Union’s Foreign and Security Policy. The services would connect strategic areas such as Arctic and Africa, in line with policy targets in these regions and the Global Gateway strategy. 2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY •Legal basis The proposal is based on Article 189(2) of the Treaty on the Functioning of the European Union (TFEU), which is the legal basis for the adoption of Union measures related to the European space policy. •Subsidiarity (for non-exclusive competence) Due to the global scale and nature of connectivity, the issue cannot be addressed either at local or even at regional level. The Programme would complement the existing EU GOVSATCOM arrangements on pooling and sharing of the existing governmental satellite communication capacity. However, no EU Member State alone has the capacity to fulfil the totality of evolving user needs and the accompanying costs. An EU solution provides added value because action and coordination at EU level would avoid duplication of efforts across the Union and Member States. It would lead to a better exploitation of existing assets, to greater security and resilience, notably through quantum cryptography, to better coverage, and to provision of a greater array of services. Other EU and Member State thematic policies would benefit too. Action at EU level has the benefit of economies of scale. The individual user needs across Member States are generally heterogeneous and often unpredictable in terms of scope, capacity, timing and location. A common denominator of all use cases is the need for flexibility due to the often unpredictable, fluctuating need for satellite communication capacity. Acquiring such flexibility of access to capacity requires large investments. •Proportionality The proposal does not introduce any measures beyond those necessary to achieve the main objectives of this Programme. In particular, the proposal defines the minimum requirements for the establishment of a European secure connectivity system and for the provision of suitable governmental satellite communication services. In this regard, the system’s capacity will be designed to complement inter alia existing Member States satellite communication capacities and cover planned additional capacity needs. The proposal does not introduce any restriction to the ability of Member States’ governmental actors to choose those capabilities they decide to use. The proposal is expected to have a positive spill-over effect on the Union’s space sector, including the New Space. In addition, citizens will benefit from an improved operational performance in civil protection. Finally, the budget allocated to the Programme is apt to achieving the objectives set and does not go beyond what is necessary. The funds needed to deliver the Programme have been determined based on a several careful analyses and estimates carried out as part of the impact assessment and described below. •Choice of the instrument A Regulation of the European Parliament and of the Council is the preferred instrument. It ensures the uniformity and direct application, required for the effective implementation of the Programme, while giving it due visibility and providing it with the financial resources it needs for its implementation.

3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS •Ex-post evaluations/fitness checks of existing legislation N/A •Stakeholder consultations This Programme is supported by inputs from expert group meetings, public consultations and workshops that gathered the views of all relevant stakeholders (Member States and industry), more precisely: ·Since 2016, numerous expert group meetings with Member States have taken place in the context of the EU GOVSATCOM initiative, discussing governmental satellite communication needs, the establishment of pooling and sharing, implementation aspects and developments towards the current Programme. ·In 2021, numerous bilateral meetings with Member States took place to gather their specific needs for governmental satellite communication and potential concerns relating to the Programme. Most Member States stated that they clearly support the Programme and its overall objectives. ·In May and November 2021, the Commission held two workshops with Member States on ’Secure Connectivity - State of Play’. During these workshops, progress on the technical study on secure connectivity was presented, together with possible exploitation models of the system. The workshops allowed for active interventions, questions and comments from Member States that were taken into account in the development of this proposal. ·In June 2021, the Commission held the ‘Secure Connectivity Workshop for the European New Space Ecosystem’. 458 participants (including 196 SME and start-ups) discussed innovative ideas for the Secure Connectivity Programme and the potential role of New Space. ·As part of the public feedback for the Inception Impact Assessment, the Commission received feedback from 13 stakeholders, representing the views of a group of EU sparsely populated territories (1), private companies (8), business associations (2), a non-governmental organisation (1), and a private citizen (1). Industry was supportive of the Programme, and the majority favoured a public-private partnership (PPP) approach. There is a general agreement amongst Member States on a need for action. Several Member States stressed that national capacities alone might possibly satisfy short-term needs, but will not be sufficient in the long term. Some of the gaps (e.g. in the Arctic) are already documented. Furthermore, several Member States confirmed their increasing governmental needs for guaranteed access to secure satellite communication. Member States also stressed the need for the involvement of New Space, as startups have demonstrated that they are technologically advanced and eager to contribute with innovative solutions. EU space industry representatives confirmed during the knowledge-building phase that there are no plans for EU private companies alone to create a satellite communication constellation to meet the evolving and increasing governmental low-latency needs. However, they welcomed the opportunity to partner with the EU for the development of such system. •Collection and use of expertise The proposal is also underpinned by data collected and findings from the study on ‘Building Blocks Towards a Secure Space Connectivity System’. The Commission also contracted an independent consultant to support the analysis of the indirect benefits of the Programme by providing the relevant econometric support and analysis. Finally, quantitative and qualitative data supporting this proposal have been collected from Member States and relevant industry stakeholders. This proposal also draws on the work of the Commission on the GOVSATCOM component of the EU Space Programme, and EuroQCI initiative, as well as on the research activities conducted within the framework of the ENTRUSTED project. •Impact assessment In line with its ‘Better Regulation’ policy, the Commission conducted an impact assessment in view of the establishment of the Programme. The problems analysed in the impact assessment, as evoked as well above, led to formulation of three specific policy objectives:

·Ensure the provision of secure satellite communication for evolving public needs; ·Increase the resilience of Member States and EU operations by guaranteed access to secure satellite communication; ·Ensure that governmental communication needs are not critically dependent on non-EU infrastructure. To close the capacity gap in the provision of secure governmental services, the following policy options were considered in order to achieve the objectives in the most effective and efficient manner: Under the ‘Baseline scenario’, no EU action would take place beyond what is currently being implemented through EU GOVSATCOM. The baseline is taken to mean the continuation of the EU GOVSATCOM Phase 1, i.e. limited to the current pooling and sharing of Member State and private satellite communication systems. In such a scenario individual Member States, or EU companies may decide to develop new satellite communication services, of which partial capacity can be sold to the EU GOVSATCOM pool. Transition to EU GOVSATCOM phase 2 in the initially planned timeframe would in all cases require a legislative act, additional budget and available frequency filings. As part of the assessment, it was also considered whether the EU could purchase the secure accredited services from established solutions by the public or private sector, currently limited to foreign market providers (Option 3 – non-EU constellation). Although the EU satcom market is already well developed, there are currently no EU providers that can serve all the increasing and evolving governmental needs. However, buying the services from non-EU private sources is not the preferred option from a security and open strategic autonomy point of view since Member States and EU Institutions require, for governmental needs, a guaranteed access in an unrestricted manner to secure connectivity services without soliciting the assent of a third party. This option 3 would thus not meet the specific objectives. Therefore, the EU needs to act to ensure the provision of these services by either fully funding and procuring its own system (Option 1 – fully public) or involving private resources (Option 2 – in the form of a concession contract with rights of commercial use). Option 1 and 2 would achieve the specific objectives to the same extent, but option 2 ranks higher with regard to the economic benefits it can generate. The common economic benefits of Options 1 and 2 are related to the deployment of a new infrastructure that would provide a gross value added (GVA) of EUR 17-24 billion and additional jobs in the EU space industry. Investments in Space upstream infrastructure are estimated to generate a six-fold impact in downstream sectors. Spill over effects are created by downstream sectors using the services, technologies and data provided by the space sector to enhance their business. These are estimated to have a GVA of EUR 10-19 billion. The additional possibility offered in Option 2 for the private sector to make further investment to develop commercial services should create more economic benefits for the downstream sector, as it can address significant commercial market opportunities. Should the private partners choose to develop additional infrastructure for commercial services, this could generate a further GVA and an additional job increase in the EU space industry for both upstream and downstream sectors. As to what concerns the social impact, governmental satellite communication enhances the resilience of EU infrastructure and public services, hence the social imprint of their operational performance. The added value of being able to communicate in case of emergencies and disasters is extremely high for citizens as well as for people responsible for critical infrastructure sites. Here again, an additional investment in commercial infrastructure would increase the social impact further. With regard to the environmental impact of the Programme, Option 2, entailing the development of an additional infrastructure, would have an environment impact from the manufacturing and launching of the system. However, compared to other industries, the manufacturing of spacecraft do not emit significant greenhouses gases. In addition, the development would comply with the the international standards on the protection of space environment (e.g. the United Nations’ Committee on the Peaceful Uses of Outer Space (COPUOS) and Inter-Agency Space Debris Coordination Committee (IADC) Space Debris Mitigation Guidelines), as well as the existing national legislation. Furthermore, the Programme is expected to have positive contributions towards the environment similar to Galileo and Copernicus, where it has been assessed that the environmental benefits stemming from the use of the components are approximately two-fold higher than the environmental footprint generated. Environmental benefits include for example satellite communication services for maritime surveillance supporting pollution detection and response environmental monitoring, and the ability to provide seamless communication capacity whenever infrastructure is disrupted, notably due to floods, hurricanes or other extreme weather phenomena resulting from climate change. Finally, Option 2 has additional advantages insofar as it: ·Improves the provision of governmental services (low latency, resilience, security, guaranteed access, autonomous use) ·Allows the provision of additional commercial services (economic growth, social benefits) ·Optimises costs incurred in the Union’s budget for: –development and deployment with economies of scale –operations with mutualisation of capacity ·Stimulates the deployment of innovative technologies, in particular with the New Space involvement (sharing the technology risk between public and private). As to the costs, the estimated cost of the satellite communication capacity designed to serve governmental demand is around EUR 6 billion, associated to the deployment of the infrastructure needed to provide the governmental services. Under Option 2, the costs are split between the contribution from the Union budget, Member States contributions and contributions by the private sector. The draft impact assessment was submitted to the Regulatory Scrutiny Board on 11 October 2021. Following the negative opinion by the Board on the first draft impact assessment report, a revised draft impact assessment was submitted to the Board for a second opinion on 21 December 2021. While noting the improvements responding to its initial comments, the Board nevertheless maintained its negative opinion on 12 January 2022, because the impact assessment still contained significant shortcomings on (1) the analytical coherence between the problem definition, objectives, options, criteria for the comparison of options and the definition of future monitoring indicators; (2) the lack of explanations on the choice of policy options with regard to technical solutions; (3) the absence of a timescale and identification of funding sources; (4) clarity on methodological assumptions and validity of secondary data cited; and (5) on the lack of explanations on the compatibility of the Programme with the objectives of the Climate Law.

Therefore, in order to address the comments of the Board’s second negative opinion, the impact assessment is complemented by an annex that provides additional clarifications and some evidence on the areas where the Board had provided specific suggestions of improvements in its opinion. The working methods of the European Commission empower the Vice-President for Inter-institutional Relations and Foresight to approve the continuation of an initiative that has been subject to a second negative opinion by the Regulatory Scrutiny Board. It is important to flag also that the opinions of the Regulatory Scrutiny Board are an assessment of the quality of the impact assessment and not an assessment of the related legislative proposal. Because of the political importance of this Programme, the urgency of action and having the additional clarifications and evidence viewed as satisfactorily addressing the identified shortcomings and suggested specifications of the Regulatory Scrutiny Board, the Commission – also in the light of the agreement by the Vice-President for Inter-Institutional Relations and Foresight – has considered it opportune to proceed with the Programme. •Regulatory fitness and simplification N/A •Fundamental rights The Programme is consistent with the Charter of Fundamental Rights (the ‘Charter’). It puts a common tool in the form of secure satellite communication at the disposal of Member States’ governments and EU actors. In enhancing the operational effectiveness of security actors, the Programme can contribute to safeguarding and strengthening citizens’ right to security (Article 6 of the Charter) and to diplomatic or consular protection when residing in a third state (Article 46 of the Charter). The Programme can also lead to a better protection of personal data (Article 8 of the Charter), because the enhanced security of the satellite communication will improve the level of information assurance against, in particular eavesdropping or spoofing, by third parties. 4.BUDGETARY IMPLICATIONS The Union's contribution from 2021 until 2027 is EUR 2400 million at current prices, out of which EUR 1600 million will be implemented under the new Union Secure Connectivity programme from 2023 to 2027, and EUR 800 million under three other Programmes: EUR 430 million under Horizon Europe, EUR 220 million under the Union Space Programme and EUR 150 million under the Neighbourhood, Development and International Cooperation Instrument (NDICI). The detailed budgetary and financial structure of the proposal on the Union budget are presented in the financial statement accompanying the proposal and will be met from the available resources of the Multiannual Financial Framework 2021-2027. EUR 1600 million are allocated to the Union Secure Connectivity Programme through reductions of EUR 260 million of the Union Space Programme, EUR 150 million of the Neighbourhood, Development and International Cooperation Instrument (NDICI) ‘emerging challenges and priorities cushion’, EUR 400 million of the European Defence Fund (EDF), EUR 440 million under the Digital Europe Programme (DEP) and EUR 200 million under the digital strand of the Connecting Europe Facility (CEF), EUR 50 million from the unallocated margin of heading 1 and EUR 100 million from the unallocated margin of heading 5 of the MFF. The Commission proposes to handle the reductions of the financial envelopes of the European Space programme, CEF, EDF, DEP and NDICI within the 15% variation provided by point 18 of the Interinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources. Article 14 of the proposal provides that the Programme will be implemented under direct management in accordance with the Financial Regulation or under indirect management with the bodies referred to in point (c) of the first subparagraph of Article 62(1) of the Financial Regulation. The estimated costs of the Programme are the result of extensive analyses, supported by the experience acquired by the Commission in the management of the EU Space Programme and through preparatory studies and stakeholder consultations. The estimated requirements in Human Resources as indicated in the Financial Statement accompanying this Regulation reflect the essential need of continuity in the expertise. 5.OTHER ELEMENTS •Implementation plans and monitoring, evaluation and reporting arrangements Article 6(1) of the proposal specifies that the Programme shall be implemented through contracts, including but not limited to concession contracts as defined under Article 2(14) of the Financial Regulation or mixed contracts. The Programme will be evaluated after three years from the Regulation’s entry into force and every four years thereafter. The evaluation of the Programme will, in line with the Commission’s Better Regulation Guidelines, assess the effectiveness, efficiency, coherence and EU added value of the Programme. In accordance with Article 37 of the proposal, the focus will in particular be on the performance of the services provided by the Programme and on the evolution of the user needs. In addition, an assessment on critical components and maturity of EU supply chain will be carried out, to ensure that governmental communication needs are not critically dependent on non-EU infrastructure. End-user EU Institutions and Agencies, the concessionaire and the European Union Agency for the Space Programme (EUSPA) together with the Commission will perform the evaluation. •Explanatory documents (for directives)

N/A •Detailed explanation of the specific provisions of the proposal The proposal consists of 11 Chapters. It is structured as follows: Chapter I contains the general provisions setting out the subject matter of the proposal, which is to establish the Union secure connectivity communication system for the period of the Union’s 2021-2027 multiannual financial framework. The Chapter also sets out both the general and specific objectives of the Programme, as well as its scope. Furthermore, the Chapter defines the Programme infrastructure. Finally, the Chapter contains a provision specifying that the Programme shall support an innovative and competitive Union space sector and stimulate the New Space ecosystem in the Union, including the participation of SMEs, start-ups and innovators from across the Union Member States. Chapter II lays down and defines the services to be provided by the Programme. Furthermore, the Chapter sets out the rules on the provision of the governmental services and defines the participants and the users of the governmental services. Chapter III sets out the funding mechanism of the Programme. It defines the funding streams and sets out the financial envelope for the contribution from the Union budget. Chapter IV sets out the rules on the implementation of the Programme, which shall be carried out by means of contracts concluded by the Commission with a contractor. Such a contract shall be awarded in accordance with the procurement principles laid down in Article 17, as well as the relevant provisions of the Financial Regulation, and may take the form of a concession contract or a mixed contract. Should the conclusion of the concession contract or mixed contract prove unviable, the Commission, according to paragraph 3, shall have the power to implement the Programme by means of a supply/services or works contract. The Chapter also sets out the rules governing the ownership and use of the assets forming part of that infrastructure Chapter V relates to the governance of the Programme. It details the role to be played by this Programme’s four main actors, namely the Commission, the European Union Agency for the Space Programme, the Member States, and the European Space Agency, and the relations between these various actors. Chapter VI deals with security, which is particularly important in view of the Programme’s strategic nature and the links between space and security. A high level of security has to be achieved and maintained by imposing effective governance arrangements that are largely based on the Member States’ experience and on the experience gained by the Commission in recent years. Furthermore, like any programme with a strategic dimension, the Programme has to undergo independent security accreditation following the appropriate standards in this respect. Chapter VII sets out the criteria for the participation of third countries and international organisations in the Programme and for the access of third countries and international organisations to the Programme’s governmental services. Chapters VIII and IX set out respectively provisions for programming and evaluation of the Programme and for delegation and implementing measures.



2022/0039 (COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing the Union Secure Connectivity Programme for the period 2023-2027 THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 189(2) thereof, Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments, Acting in accordance with the ordinary legislative procedure, Whereas: (1)There is a growing demand by the Union governmental actors for secure and reliable satellite communication services, particularly because they are the only viable option in situations where ground-based communication systems are non-existent, disrupted or unreliable. Affordable and cost-effective access to satellite-based communication is also indispensable in remote regions and in the high seas and airspace. For instance, where lack of high-bandwidth communication currently limits the ability to take full advantage of new sensors and platforms observing the 71% of our planet that is ocean, satellite communication ensures the long-term availability of worldwide uninterrupted access. (2)The conclusions of the European Council of 19-20 December 2013 welcomed the preparations for the next generation of Governmental Satellite Communication through a close cooperation between the Member States, the Commission and the European Space Agency (ESA). Governmental satcom has also been identified as one of the elements of the Global Strategy for the European Union’s Foreign and Security Policy of June 2016. Governmental satcom is to contribute to the EU response to Hybrid Threats and provide support to the EU Maritime Security Strategy and to the Union Arctic policy. (3)On 22 March 2017 the Council Political and Security Committee endorsed High Level Civil Military User Needs for Governmental Satellite Communications which were prepared by the EEAS on the military user's requirements identified by the European Defence Agency in its Common Staff Target adopted in 2014 and the civilian user needs collected by the Commission have been merged to produce the High Level Civil Military User Needs for Governmental Satellite Communications. (4)The EU adopted the GOVSATCOM component of Regulation (EU) 2021/696 on 28 April 2021, to ensure the long-term availability of reliable, secure and cost-effective satellite communications services for GOVSATCOM users. Regulation (EU) 2021/696 envisages that in a first phase, of the GOVSATCOM component until approximately 2025, existing capacity would be used. In that context, the Commission is to procure GOVSATCOM capacities from Member States with national systems and space capacities and from commercial satellite communication or service providers, taking into account the essential security interests of the Union. In that first phase, GOVSATCOM services are to be introduced by a step-by-step approach. It is also based on the premise that if in the course of the first phase a detailed analysis of future supply and demand reveals that this approach was insufficient to cover the evolving demand, will be necessary to move to a second phase and develop additional bespoke space infrastructure or capacities through cooperation with the private sector, e.g. with Union satellite operators. (5)It is now clear that the Union’s current satellite communication assets cannot meet new needs of the governmental users who are moving towards higher security solutions, low latency and global coverage. Although recent technical progress has allowed non-geostationary-orbit (NGSO) communications constellations to emerge and gradually offer high-speed and low-latency connectivity services. There is a window of opportunity for addressing the evolving needs of the governmental users by developing and deploying additional infrastructure as filings for the frequencies necessary to provide the required services are currently available within the European Union. If not used, these filings will become obsolete and be attributed to other players. As frequencies are an increasingly scarce resource, the EU may not get this opportunity again. (6)The conclusions of the European Council of 21-22 March 2019 stressed that the Union needs to go further in developing a competitive, secure, inclusive and ethical digital economy with world-class connectivity. (7)The Commission’s ‘Action Plan on synergies between civil, defence and space industries’ of 22 February 2021, states that it aims to ‘enable access to high-speed connectivity for everyone in Europe, and provide a resilient connectivity system allowing Europe to remain connected whatever happens’. (8)The Union should ensure the provision of resilient, global, guaranteed and flexible satellite communication solutions for evolving governmental needs, built on an EU technological and industrial base, in order to increase the resilience of Member States’ and Union institutions’ operations by guaranteed and uninterrupted access to satellite communication. (9)Satellite communication can increase the overall resilience of communication networks. A space-based communication system is the only viable option in situations where ground-based systems are non-existent, disrupted or unreliable. For example, it can provide means for digital communication in areas where terrestrial networks are absent, including over oceans and during flights, as well as over remote areas, or where local networks have been destroyed due to natural disasters, or they cannot be trusted in crisis situations. (10)Therefore, it is important to establish a new, Union Secure Connectivity Programme (‘the Programme’) to provide for the Union satellite based communication infrastructure, which should be built upon the GOVSATCOM component of the Union Space Programme and which should also take advantage of additional national and European capacities, which exist at the time the action is being carried out and develop further the European Quantum Communication Infrastructure (EuroQCI) initiative. (11)The Programme should ensure the provision of the governmental services and allow for the provision of the commercial services through a dedicated governmental and commercial infrastructure. The Programme should therefore consist of development and validation actions for the construction of the initial space and ground infrastructure and for the launch of the initial space infrastructure. The Programme should then entail deployment activities aimed at completing both the space and ground infrastructure required for the provision of governmental services. The provision of governmental services, the operation, maintenance and continuous improvement of the infrastructure, once deployed, as well as the development of the future generations of the governmental services should be part of the exploitation activities. The exploitation activities should begin as soon as possible with the provision of the initial set of services aimed by 2024 to meet as soon as possible the evolving needs of the governmental users. (12)Since June 2019, Member States have signed the European Quantum Communication Infrastructure (EuroQCI) Declaration, agreeing to work together, with the Commission and with the support of ESA, towards the development of a quantum communication infrastructure covering the whole EU. According to that Declaration, EuroQCI aims at deploying a certified secure end-to-end quantum communication infrastructure, enabling information and data to be transmitted and stored ultra-securely and capable of linking critical public communication assets all over the Union. To that purpose an interconnected space infrastructure and terrestrial infrastructure, should be built to enable the generation and distribution of cryptographic keys based on quantum information theory. The Programme will contribute to meet the objectives of the EuroQCI Declaration by developing a EuroQCI space infrastructure integrated into the space and ground infrastructure of the Programme. The EuroQCI space infrastructure should be developed in the Programme in two main phases, a preliminary validation phase and a full deployment phase, which should see full integration with the Programme, including appropriate solutions for inter-satellite connectivity and data relay between satellites and the ground. The Programme should integrate the EuroQCI in its governmental infrastructure, as it will provide future-proof cryptographic systems that offer unprecedented levels of secure communications by resisting future quantum computing attacks. (13)To optimise all available satellite communication resources, in order to guarantee access in unpredictable situations, such as natural disasters, and to ensure operational efficiency and short turn-around times, a ground segment is required. It should be designed on the basis of operational and security requirements. (14)In order to expand the Union satellite communication capacities, the Programme infrastructure should integrate the infrastructure developed for the purposes of the of the GOVSATCOM component of the Union Space Programme. In particular, the Programme’s ground infrastructure should encompass the GOVSATCOM Hubs and other ground segment assets. (15)The services enabled by the Programme should connect strategic areas such as the Arctic and Africa, and contribute to geopolitical resilience by offering additional connectivity in line with policy targets in these regions and the Global Gateway strategy. (16)It is appropriate that the satellites built for the purposes of the Programme are equipped with payloads that can allow to increase the capacity and services of the components of the Union Space Programme, enabling thereby the development of additional missions under the conditions set out in Regulation (EU) 2021/696It could offer alternative positioning, navigation and timing services complementing Galileo, ensure the broadcast of EGNOS/SBAS messages with a lower latency, provide space based sensors for space surveillance and support enhancement of current Copernicus capabilities in particular for emergency and civil security services. (17)It is vital for the security of the Union and its Member States and for ensuring the security and integrity of the governmental services, that, where possible, the space assets of the Programme are launched from the territory of the Member States. Furthermore, microlaunchers are able to provide additional flexibility to allow for a rapid deployment of the space assets.

(18)It is important that the Union owns all tangible and intangible assets related to governmental infrastructure while ensuring the respect of the Charter of Fundamental Rights of the European Union, including its Article 17. Despite the ownership by the Union of those assets, it should be possible for the Union, in accordance with this Regulation and, where it is deemed appropriate on a case-by-case assessment, to make those assets available to third parties or to dispose of them. (19)The Programme should provide services aimed at meeting the needs of the governmental users. The High Level Civil Military User Needs for Governmental Satellite Communications, which was endorsed by the Council Security Committee in March 2017, identified three pillars of governmental services use-cases: surveillance, crisis management and connection and protection of key infrastructures. (20)Operational requirements for the governmental services should be based on the use-case analysis. From those operational requirements, in combination with security requirements and evolving demand of governmental services, the portfolio of governmental services should be developed. The service portfolio should establish the applicable baseline for the governmental services. The service portfolio for the governmental services should take into account the service portfolio of the GOVSATCOM services established within the framework of Regulation (EU) 2021/696. In order to maintain the best possible match between the demand and supplied services, the service portfolio for governmental services should be regularly updated. (21)Satellite communications is a finite resource limited by the satellite capacity, frequency and geographical coverage. In order to be cost-effective and to capitalise on economies of scale, the Programme should optimise the match between the supply and demand of the governmental services. Since the demand and the potential supply both change over time, the Commission should monitor the needs to adjust the portfolio for the governmental services whenever this appears necessary. (22)The Programme should also allow for the provision of commercial services by the private sector. Such commercial services could in particular contribute to availability of high-speed broadband and seamless connectivity throughout Europe, removing communication dead zones and increasing cohesion across Member State territories, including rural, peripheral, remote and isolated areas and islands, and provide connectivity over geographical areas of strategic interest. (23)Member States, the Council, the Commission and the European External Action Service (‘EEAS’), as well as Union agencies and bodies should be able to become the Programme participants, insofar as they choose to authorise users of governmental services or provide capacities, sites or facilities. Taking into consideration that it is for the Member States to decide whether to authorise national users of governmental services, Member States should not be obliged to become Programme participants or to host Programme infrastructure. (24)Each Programme participant should designate a Secure Connectivity Competent Authority to monitor whether users, and other national entities that play a role in the Programme, comply with the applicable rules and security procedures as laid down in the security requirements. (25)This Regulation lays down a financial envelope, which is to constitute the prime reference amount, within the meaning of point 18 of the Interinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources, for the European Parliament and the Council during the annual budgetary procedure. (26)The Programme objectives are coherent and complementary with those of other Union programmes, particularly Horizon Europe established by Regulation (EU) 2021/695 of the European Parliament and of the Council, the Digital Europe Programme established by Regulation (EU) 2021/694 of the European Parliament and of the Council, the Neighbourhood, Development and International Cooperation Instrument – Global Europe established by Regulation (EU) 2021/947 of the European Parliament and of the Council, the Connecting Europe Facility established by Regulation (EU) 2021/1153 of the European Parliament and of the Council and, in particular, the Union Space Programme established by Regulation (EU) 2021/696 of the European Parliament and of the Council. (27)The Horizon Europe Programme will allocate a dedicated share of its Cluster 4 components to R&I activities related to development and validation of the secure connectivity system, including for the potential technologies that would be developed under New Space. The Neighbourhood, Development and International Cooperation Instrument (NDICI) will allocate a dedicated share of its Global Europe funds for activities related to the operation of the system and the worldwide provision of services that will allow to offer an array of services to international partners. The Union Space Programme will allocate a dedicated share of its GOVSATCOM component for the activities related to the development of the GOVSATCOM Hub which will form part of the ground infrastructure of the Secure Connectivity system. The funding stemming from these programmes should be implemented in accordance with the rules of these programmes. Since those rules may differ significantly from the rules under this Regulation, the need to achieve effectively the intended policy objectives should be taken into account when deciding to finance actions from both the allocated funds from Horizon Europe and NDICI and from the Union Secure Connectivity Programme. (28)Due to its inherent implications on the security of the Union and its Member States, the Programme also shares objectives and principles with the European Defence Fund established by Regulation (EU) 2021/697 of the European Parliament and of the Council. Therefore, part of the funding from that Programme should be provided to fund the activities under this Programme, particularly the actions related to the deployment of its infrastructure. (29)Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (the ‘Financial Regulation’) applies to the Programme. The Financial Regulation lays down rules on the implementation of the Union budget, including the rules on grants, prizes, procurement, indirect management, financial instruments, budgetary guarantees, financial assistance and the reimbursement of external experts. (30)In accordance with Article 191(3) of the Financial Regulation, in no circumstances are the same costs to be financed twice by the Union budget. (31)The Commission, in performing certain tasks of a non-regulatory nature, should be able to have recourse, as required and insofar as necessary, to the technical assistance of certain external parties. Other entities involved in the public governance of the Programme should also be able to make use of the same technical assistance in performing tasks entrusted to them under this Regulation. (32)Horizontal financial rules adopted by the European Parliament and by the Council on the basis of Article 322 of the Treaty on the Functioning of the European Union (‘TFEU’) apply to this Regulation. Those rules are laid down in the Financial Regulation and determine in particular the procedure for establishing and implementing the budget through grants, procurement, prizes and indirect implementation, and provide for checks on the responsibility of financial actors. Rules adopted on the basis of Article 322 TFEU also include a general regime of conditionality for the protection of the Union budget. (33)Procurement contracts concluded under the Programme for activities financed by the Programme should comply with Union rules. In that context, the Union should also be responsible for defining the objectives to be pursued as regards public procurement. (34)Article 154 of the Financial Regulation provides that, on the basis of the results of an ex-ante assessment, the Commission is to be able to rely on the systems and the procedures of the persons or entities entrusted with the implementation of Union funds. If necessary, specific adjustments to those systems and procedures (‘supervisory measures’), as well as the arrangements for the existing contracts, should be defined in the corresponding contribution agreement. (35)In order to meet the objectives of the Programme, it is important to be able to call, where appropriate, on capacities offered by Union public and private entities active in the space domain and also to be able to work at international level with third countries or international organisations. For that reason, it is necessary to provide for the possibility to use all the relevant tools and management methods provided for by the TFEU and the Financial Regulation and joint procurement procedures. (36)In accordance with the Financial Regulation, Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council and Council Regulations (EC, Euratom) No 2988/95, (Euratom, EC) No 2185/96 and (EU) 2017/1939 , the financial interests of the Union are to be protected by means of proportionate measures, including measures relating to the prevention, detection, correction and investigation of irregularities including fraud, the recovery of funds lost, wrongly paid or incorrectly used, and, where appropriate, the imposition of administrative penalties. In particular, in accordance with Regulations (Euratom, EC) No 2185/96 and (EU, Euratom) No 883/2013 the European Anti-Fraud Office (OLAF) has the power to carry out administrative investigations, including on-the-spot checks and inspections, with a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. The European Public Prosecutor’s Office (EPPO) is empowered, in accordance with Regulation (EU) 2017/1939, to investigate and prosecute criminal offences affecting the financial interests of the Union as provided for in Directive (EU) 2017/1371 of the European Parliament and of the Council.In accordance with the Financial Regulation, any person or entity receiving Union funds is to fully cooperate in the protection of the financial interests of the Union, grant the necessary rights and access to the Commission, OLAF, the Court of Auditors and, in respect of those Member States participating in enhanced cooperation pursuant to Regulation (EU) 2017/1939, the EPPO, and ensure that any third parties involved in the implementation of Union funds grant equivalent rights. (37)In order to ensure the protection of the financial interests of the Union, it is necessary to require third countries to grant the necessary rights and access required for the authorising officer responsible, OLAF and the Court of Auditors to comprehensively exercise their respective competences.

(38)A public-private partnership is the most appropriate scheme to ensure that the objectives of the Programme could be pursued. It would permit to build upon the existing EU satellite communication technological and infrastructural base and to provide robust and innovative governmental services, while allowing the private partner to complement the Programme infrastructure with additional capabilities to offer commercial services through additional own investments. Such a scheme would furthermore optimise deployment and operation costs by sharing development and deployment costs on components common to both governmental and commercial infrastructures, as well as operational costs by allowing a high level of capacity mutualisation. It would stimulate innovation in particular for New Space by enabling the sharing of Research and Development risks between public and private partners. (39)The implementation model could take the form of a concession contract or other contractual arrangements. Regardless of the implementation model, several key principles should be put in place. The contract should establish a clear distribution of tasks and responsibilities between the public and private partners. Thus, it should avoid any overcompensation of the private partner for the provision of governmental services, allow the provision of commercial services to be established by the private sector and ensure an appropriate prioritisation of governmental user needs. The Commission should be able to assess and approve such services to ensure that the Union’s essential interests and Programme’s objectives are preserved and adequate safeguards are put in place to prevent potential distortions of competition stemming from the provision of commercial services; such safeguards could include separation of accounts between governmental and commercial services, open, fair and non-discriminatory access to infrastructure necessary for the provision of commercial services. The public-private partnership should foster the participation of start-ups and SMEs along the whole value chain of the concession and across Member States, hereby incentivising the development of innovative and disruptive technologies (40)Sound public governance of the Programme requires the clear distribution of responsibilities and tasks among the different actors involved to avoid unnecessary overlap and reduce cost overruns and delays. All the actors of the governance should support, in their field of competence and in accordance with their responsibilities, the achievement of the objectives of the Programme. (41)Member States have long been active in the field of space. They have systems, infrastructure, national agencies and bodies linked to space. They are therefore able to make a major contribution to the Programme, especially in its implementation. They might cooperate with the Union to promote the Programme’s services and applications and ensure coherence between the relevant national initiatives and the Programme. The Commission might be able to mobilise the means at Member States’ disposal, benefit from their assistance and, subject to mutually agreed conditions, entrust the Member States with non-regulatory tasks in the implementation of the Programme. Moreover, the Member States concerned should take all necessary measures to ensure the protection of the ground infrastructure established on their territories. In addition, Member States and the Commission should work together and with appropriate international bodies and regulatory authorities to ensure that the frequencies necessary for the Programme are available and protected at the adequate level to allow for the full development and implementation of applications based on the services offered, in compliance with Decision No 243/2012/EU of the European Parliament and of the Council. (42)In accordance with Article 17 of the Treaty on European Union (‘TEU’) and as a promoter of the Union’s general interest, it is the Commission’s responsibility to implement the Programme, assume overall responsibility and promote its use. In order to optimise the resources and competences of the various stakeholders, the Commission should be able to entrust certain tasks to other entities under justifiable circumstances. Having the overall responsibility for the Programme, the Commission should determine the main technical and operational requirements necessary to implement systems and services evolution. It should do so after having consulted Member States’ experts, users and other relevant stakeholders. Finally, in accordance with Article 4(3) TFEU, the exercise of competence by the Union does not result in Member States being prevented from exercising their competences. However, to make good use of the Union funds, it is appropriate that the Commission ensures, as far as possible, the coherence of activities performed in the context of the Programme, with those of the Member States. (43)The mission of the European Union Agency for the Space Programme (‘the Agency’) is to contribute to the Programme, particularly as regards security accreditation. Certain tasks linked to those areas should therefore be entrusted to the Agency. In relation to security in particular, and given its experience in this area, the Agency should be responsible for the security accreditation of the governmental services and infrastructure. Furthermore, the Agency should perform the tasks which the Commission confers on it. When entrusting tasks to the Agency, adequate human, administrative and financial resources should be made available. (44)Building on the expertise developed in the past years in management, operation and service provision related to the Galileo and EGNOS components of the Union Space Programme, the Agency is the most appropriate body to implement, under the supervision of the Commission, all the tasks relating to the operation of the governmental infrastructure and provision of governmental services. The Agency should therefore be entrusted with the operation of the governmental infrastructure and the provision of governmental services. (45)In order to ensure the operation of the governmental infrastructure and facilitate the provision of the governmental services, the Agency should be allowed to entrust, by means of contribution agreements, specific activities to other entities, in areas of their respective competence, under the conditions of indirect management applying to the Commission. (46)ESA is an international organisation with extensive expertise in the space domain including in satellite communication and is therefore an important partner in the implementation of the different aspects of the Union’s space policy. In that regard, ESA should be able to provide technical expertise to the Commission, including for the preparation of the technical aspects of the Programme. To this purpose, ESA may be entrusted with the development and validation activities of the Programme, and support the evaluation of the contracts concluded in the context of the implementation of the Programme. (47)Owing to the importance of space-related activities for the Union economy and the lives of Union citizens, achieving and maintaining a high degree of security should be a key priority for the Programme, particularly in order to safeguard the interests of the Union and of the Member States, including in relation to classified and sensitive non-classified information. (48)Under Article 17 TEU, the Commission is responsible of the management of programmes which, in accordance with rules set out in the Financial Regulation, may be sub-delegated to third parties, in indirect management. In that context, the Commission must ensure that the tasks performed by third parties to implement the Programme in indirect management do not undermine the security of the Programme in particular as regards to the control of classified information. It should therefore be clarified that where the Commission entrusts ESA to carry out tasks under the Programme, the corresponding contribution agreements must ensure that classified information generated by ESA is considered as EU classified information (‘EUCI’) in accordance with Commission Decision (EU, Euratom) 2015/444 and Council Decision 2013/488/EU created under the authority of the Commission. (49)Without prejudice to Member States’ prerogatives in the area of national security, the Commission and the High Representative, each within their respective area of competence, should ensure the security of the Programme in accordance with this Regulation and, where relevant, Council Decision (CFSP) 2021/698. (50)Given the specific expertise of the EEAS and its regular contact with authorities of third countries and international organisations, the EEAS should be able to assist the Commission in performing certain tasks relating to the security of the Programme in the field of external relations, in accordance with Council Decision 2010/427/EU. (51)Without prejudice to the sole responsibility of the Member States in the area of national security, as provided for in Article 4(2) TEU, and to the right of the Member States to protect their essential security interests in accordance with Article 346 TFEU, a specific governance of security should be established to ensure a smooth implementation of the Programme. That governance should be based on three key principles. Firstly, it is imperative that Member States’ extensive, unique experience in security matters be taken into consideration to the greatest possible extent. Secondly, in order to prevent conflicts of interest and any shortcomings in applying security rules, operational functions should be segregated from security accreditation functions. Thirdly, the entity in charge of managing all or part of the Programme’s infrastructure is also the best placed to manage the security of the tasks entrusted to it. The security of the Programme would build upon the experience gained in the implementation of the Union Space Programme over the past years. Sound security governance also requires that roles be appropriately distributed among the various players. As it is responsible for the Programme, the Commission, without prejudice to Member States prerogatives in the area of national security, should determine the general security requirements applicable to the Programme. (52)The cybersecurity of the Programme infrastructures, both ground and space, is key to ensuring the continuity of the service and the operations of the system. The need to protect the system and its services against cyberattacks, including by making use of new technologies, should therefore be duly taken into account when establishing security requirements. (53)Where appropriate, after the risk and threat analysis, the Commission should identify a security monitoring structure. That security monitoring structure should be the entity responding to instructions developed under the scope of Decision (CFSP) 2021/698. (54)The governmental services provided by the Programme will be used by the Union’s governmental actors in security and safety critical missions. Therefore, such services and infrastructure should be subject to security accreditation. (55)It is indispensable that security accreditation activities be carried out on the basis of collective responsibility for the security of the Union and its Member States, by endeavouring to build consensus and involving all those concerned with the issue of security, and that a procedure for permanent risk monitoring be put in place. It is also necessary that technical security accreditation activities are conducted by professionals who are duly qualified in the field of accreditation of complex systems and who have an adequate level of security clearance. (56)An important objective of the Programme is to ensure the security of the Union and the Member States and to strengthen the resilience across key technologies and value chains. In specific cases, that objective requires conditions for eligibility and participation to be set, to ensure the protection of the integrity, security and resilience of the operational systems of the Union. That should not undermine the need for competitiveness and cost-effectiveness. (57)Considering the importance for the Programme of its ground governmental infrastructure and the impact thereof on its security, the location of such infrastructure should be determined by the Commission. The deployment of the ground governmental infrastructure of the Programme should continue to follow an open and transparent process, which could involve the Agency where appropriate based on its field of competence.

(58)The Programme’s governmental services will be used in security and safety critical missions and operations by Union and Member State actors. Therefore, in order to protect the essential security interest of the Union and its Member States, measures to ensure a necessary level of non-dependence on third parties (third countries and entities from third countries) are needed, covering all Programme elements. This includes space and ground technologies at component, subsystem and system level, manufacturing industries, owners and operators of space systems, and physical location of ground system components. (59)To ensure the competitiveness of the European space industry in the future, the Programme should contribute to the development of advanced skills in space-related fields and support education and training activities, promoting equal opportunities, gender equality and women's empowerment, in order to realise the full potential of Union citizens in that area. (60)Given its worldwide coverage, the Programme has a strong international dimension. International partners, their governments and citizens will be recipients of the Programme’s array of services with accrued benefits to the international cooperation of the Union and the Member States with these partners. For matters relating to the Programme, the Commission might coordinate, on behalf of the Union and in its field of competence, the activities on the international scene. In particular, the Commission, as regards the Programme, would defend the interests of the Union and the Member States in international fora, including in the area of frequencies, without prejudice to Member States’ competence in that area. (61)Members of the European Free Trade Association (EFTA) which are members of the European Economic Area (EEA), acceding countries, candidate countries and potential candidates as well as the European Neighbourhood Policy countries and other third countries may be allowed to participate in the Programme only on the basis of an agreement to be concluded in accordance with Article 218 TFEU. (62)Pursuant to Council Decision 2013/755/EU, persons and entities established in overseas countries or territories are eligible for funding subject to the rules and objectives of the Programme and possible arrangements applicable to the Member State to which the relevant overseas country or territory is linked. (63)In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission relating to adoption of the location of the centres belonging to the ground governmental infrastructure, the operational requirements for governmental services, the service portfolio for governmental services, as well as the establishment of additional requirements for the participation of third countries and international organisations in the Programme. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council. (64)In principle, the governmental services should be provided free of charge to users of the governmental services. If, after analysis, the Commission concludes that there is a shortage of capacities, it should be permitted to develop a pricing policy as part of those detailed rules on the service provision in order to avoid a distortion of the market. The Commission should be conferred with implementing powers to adopt such pricing policy. Those powers should be exercised in accordance with Regulation (EU) No 182/2011. (65)In order to ensure uniform conditions for the implementation of this Regulation, implementing powers relating to the location of the ground segment of the governmental infrastructure should be conferred on the Commission. For the selection of such locations, the Commission should be able to take into account the operational and security requirements, as well as the existing infrastructure. Those powers should be exercised in accordance with Regulation (EU) No 182/2011. (66)In the interest of sound public governance and given the synergies between this Programme and the Union Space Programme, and in particular to ensure appropriate synergies with the GOVSATCOM component, the Programme committee established within the framework of Regulation (EU) 2021/696 in the GOVSATCOM configuration should also serve as the committee for the purposes of this Programme. For matters pertaining to the security of the Programme, the Programme committee should meet in a dedicated security configuration. (67)As sound public governance requires uniform management of the Programme, faster decision-making and equal access to information, representatives of the entities entrusted with tasks related to the Programme might be able to take part as observers in the work of the Programme committee established in application of Regulation (EU) No 182/2011. For the same reasons, representatives of third countries and international organisations who have concluded an international agreement with the Union, relating to the Programme, might be able to take part in the work of the Programme committee subject to security constraints and as provided for in the terms of such agreement. The representatives of entities entrusted with tasks related to the Programme, third countries and international organisations should not be entitled to take part in the Programme committee voting procedures. The conditions for the participation of observers and ad hoc participants should be laid down in the rules of procedure of the Programme committee. (68)Pursuant to paragraphs 22 and 23 of the Interinstitutional Agreement of 13 April 2016 on Better Law-Making, this Programme should be evaluated on the basis of information collected in accordance with specific monitoring requirements, while avoiding administrative burden, in particular on Member States, and overregulation. Those requirements, where appropriate, should include measurable indicators as a basis for evaluating the effects of the Programme. The evaluation of this Programme should take into account the findings of the evaluation of the Union Space Programme pertaining to the GOVSATCOM component conducted within the framework of Regulation (EU) 2021/696. (69)In order to ensure the continuing adequacy of the indicators to report on the progress of the Programme, as well as the Programme’s monitoring and evaluation framework, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of amending the Annex to this Regulation with regard to the indicators, as well as to supplement this Regulation with provisions on the establishment of a monitoring and evaluation framework, which may consider inter alia, the end user uptake and impacts on the internal market. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement on Better Law-Making of 13 April 2016. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. (70)In order to ensure uniform conditions for the implementation of the Programme’s security requirements, implementing powers should be conferred on the Commission. Those powers should be exercised in accordance with Regulation (EU) No 182/2011. Member States should be able to exert a maximum of control over the Programme’s security requirements. When adopting implementing acts in the area of security of the Programme, the Commission should be assisted by the Programme committee meeting in a dedicated security configuration. In view of the sensitivity of security matters, the chair of the Programme committee should endeavour to find solutions which command the widest possible support within the committee. The Commission should not adopt implementing acts determining the general security requirements of the Programme in cases where no opinion is delivered by the Programme committee. (71)Since the objective of this Regulation cannot be sufficiently achieved by the Member States, but can rather, by reason of the scale and effects of the action that go beyond the financial and technical capacities of any single Member State, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 TEU. 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, HAVE ADOPTED THIS REGULATION: Chapter I

General provisions Article 1 Subject matter 1.This Regulation establishes the Union Secure Connectivity Programme (‘the Programme’). It lays down the objectives of the Programme, and the rules on the activities of the Programme, infrastructure and services of the Programme, participants of the Programme, the budget for the period 2023-2027, the forms of Union funding and the rules for providing such funding, as well as the rules for the implementation of the Programme. Article 2

Definitions For the purposes of this Regulation, the following definitions apply: (1)‘Critical infrastructure’ means an asset, system or part thereof located in Member States which is essential for the maintenance of vital societal functions, health, safety, security, economic or social well-being of people, and the disruption or destruction of which would have a significant impact in a Member State as a result of the failure to maintain those functions; (2)‘European Quantum Communication Infrastructure (EuroQCI)’ means an interconnected space and ground infrastructure belonging to the infrastructure of the Programme using quantum-based technology to ensure the distribution of cryptographic keys; (3)‘GOVSATCOM Hub’ shall have the meaning defined in Article 2(23) of Regulation (EU) 2021/696; (4) ‘GOVSATCOM user’ shall have the meaning defined in Article 2(22) of Regulation (EU) 2021/696; (5)‘Infrastructure’ means an asset, system or part thereof, which is necessary for the delivery of the services provided by the Programme; (6)‘New Space industry’ means private companies, small and medium-sized enterprises and start-ups that develop novel space technologies and applications; (7)‘Payload’ means equipment carried by a spacecraft for the performance of a particular mission in space; (8)‘Secure connectivity system’ means the system developed in accordance with this Regulation comprising the infrastructure referred to in Article 5 and providing the services referred to in Article 7; (9)‘The Agency’ means the European Union Agency for the Space Programme established by Regulation (EU) 2021/696. Article 3 Programme objectives 1.The general objective of the Programme is to establish a secure and autonomous space-based connectivity system for the provision of guaranteed and resilient satellite communication services, in particular to: (a)ensure the long-term availability of worldwide uninterrupted access to secure and cost-effective satellite communication services to governmental users in accordance with paragraphs 1 to 3 of Article 7, which supports protection of critical infrastructures, surveillance, external actions, crisis management and applications that are critical for the economy, environment, security and defence, thereby increasing the resilience of Member States; (b)allow for the provision of commercial services by the private sector in accordance with Article 7(4). 2.The Programme has the following specific objectives: (a)improve the resilience of the Union communication services by developing, building and operating a multi-orbital connectivity infrastructure, continuously adapted to evolution of demand for satellite communications, while taking into account the existing and future assets of the Member States used in the frame of the GOVSATCOM component of the Union Space Programme established by Regulation (EU) 2021/696; (b)contribute to cyber resilience by proactive and reactive defence against cyber and electromagnetic threats and operational cybersecurity, and integrate the space and related ground segment of the European Quantum Communication Infrastructure to enable secure transmission of cryptographic keys; (c)improve and expand the capabilities and services of other components of the Union Space Programme;

(d)incentivise the deployment of innovative and disruptive technologies, in particular by leveraging the New Space industry; and (e)allow further development of high-speed broadband and seamless connectivity throughout the Union, removing communication dead zones and increasing cohesion across Member State territories, and allow connectivity over geographical areas of strategic interest outside of the Union. Article 4 Implementation activities of the Programme 1.The provision of the governmental services referred to in Article 7(1) shall be ensured through the implementation of the following activities: (a)development and validation activities, comprising the construction and launch of the initial space and ground infrastructure required to provide governmental services; (b)development and integration of the space and related ground segment of the European Quantum Communication Infrastructure into the space and ground infrastructure of the secure connectivity system (c)deployment activities to complete the space and ground infrastructure required to provide governmental services; (d)exploitation activities for the provision of governmental services, comprising: (i)the operation, maintenance, continuous improvement and protection of the space and ground infrastructure, including replenishment and obsolescence management. (e)development of future generations of the space and ground infrastructure and the evolution of the governmental services. 2.The exploitation activities referred to in paragraph 1, point (d), shall begin progressively with the provision of a preliminary set of services by 2024. Those early services shall be improved through the gradual deployment of the space and ground infrastructure leading to full operational capability aimed by 2027. 3.Actions referred to in Article 6 shall be provided throughout the whole duration of the Programme. Article 5 Infrastructure of the secure connectivity system 1.The infrastructure of the secure connectivity system shall consist of governmental and commercial infrastructure as laid down in paragraphs 2 and 3 respectively. 2.The governmental infrastructure of the secure connectivity system shall include all the related ground and space assets which are required for the provision of the governmental services, as set out in Article 7(1), including the following assets: (a)satellites or satellite subcomponents; (b)space and ground subcomponents ensuring the distribution of cryptographic keys; (c)infrastructure for monitoring the security of the Programme infrastructure and services;

(d)infrastructure for the provision of the services to the governmental users; (e)the GOVSATCOM ground segment infrastructure as set out in Article 67 of Regulation (EU) 2021/696, including the GOVSATCOM Hubs. For the purpose of this Regulation, the right of use of the frequencies necessary for the transmission of the signals generated by the ground and space assets of the governmental infrastructure shall be part of the governmental infrastructure. The governmental infrastructure shall support additional payloads that may be used as part of the space-based infrastructure of the components of the Union Space Programme listed in Article 3 of Regulation (EU) 2021/696 under the terms and conditions set out in that Regulation. 3.The Commission shall, by means of implementing acts, lay down, where necessary, measures required to determine the location of the centres belonging to the ground governmental infrastructure, except the GOVSATCOM Hubs, in accordance with security requirements, following an open and transparent process. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 42(2) of this Regulation. The location of the GOVSATCOM Hubs shall be determined in accordance with Article 67(2) of regulation (EU) 2021/696. For the protection of the security interests of the Union and its Member States the centres referred to in the first subparagraph shall be, where possible, located in the territory of the Member States and governed by a hosting agreement taking the form of an administrative agreement between the Union and the Member State concerned. Where it is not possible to locate the centre in the territory of the Member States, the Commission may determine the location of such centre in the territory of a third country, subject to a hosting agreement between the Union and the third country concerned concluded in accordance with Article 218 TFEU. 4.The commercial infrastructure referred to in paragraph 1 shall include all space and ground assets other than those being part of the governmental infrastructure. The commercial infrastructure shall be entirely financed by the contractor referred to in Article 15(2). 5.In order to protect the security interests of the Union, the space assets of the secure connectivity system shall be launched by a launch service provider that complies with the conditions set out in Article 19 and, where possible, from the territory of the Member States. Article 6 Actions in support of an innovative and competitive Union space sector 1.The Programme shall support an innovative and competitive Union space sector and stimulate the New Space industry in the Union, and in particular the initiatives and activities listed in Article 6 of Regulation (EU) 2021/696, including, where appropriate, support of commercial services. 2.The Commission shall contribute to the activities referred to in paragraph 1, by taking the following measures: (a)establish criteria for the award of the contracts referred to in Article 15 ensuring the participation of start-ups and small and medium-sized enterprises (SMEs) from across the Union and along the whole relevant value chain; (b)require that the contractor referred to in Article 15(2) provides a plan on the integration of start-ups and SMEs from across the Union in the activities under the contracts referred to in Article 15; (c)require through the contracts referred to in Article 15 that start-ups and SMEs are able to deliver own services to end-users; (d)promote stronger participation of women innovators and establish equality and inclusion goals in the tender documentation. Chapter II

Services Article 7 Definition of Services portfolio

1.The provision of governmental services shall be ensured as laid down in the service portfolio referred to in paragraph 3 and in accordance with the operational requirements set out in in paragraph 2. 2.The Commission shall adopt, by means of implementing acts, the operational requirements for governmental services, in the form of technical specifications for use-cases related in particular to crisis management, surveillance and key infrastructure management, including diplomatic communication networks. Those operational requirements shall be based on the detailed analysis of the requirements of the Programme users, shall take into account requirements stemming from existing user equipment and networks and operational requirements for GOVSATCOM services according to Article 63(2) of the Space Programme Regulation. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 42(2). 3.The Commission shall adopt, by means of implementing acts, the service portfolio for the governmental services in the form of a list of services and their attributes, including geographical coverage, frequency, bandwidth, user equipment, and security features. Those implementing acts shall be based on the operational requirements referred to in paragraph 2 of this Article and applicable security requirements referred to in Article 27(2). These implementing acts shall be adopted in accordance with the examination procedure referred to in Article 42(2). 4.The provision of commercial services shall be financed by the contractor referred to in Article 15(2). The terms and conditions for the provision of commercial services shall be determined in the contracts referred to in Article 15. They shall in particular specify how the Commission will assess and approve the provision of commercial services to ensure that the Union’s essential interests and the Programme’s general and specific objectives referred to in Article 3 are preserved. They shall also include adequate safeguards to prevent distortions of competition in the provision of commercial services, to avoid any conflict of interest, undue discrimination and any other hidden indirect advantages to the contractor referred to in Article 15(2). Such safeguards may include the obligation of accounting separation between the provision of governmental services and the provision of commercial services, including the setting up of a structurally and legally separate entity from the vertically integrated operator for the provision of governmental services, and the provision of open, fair and non-discriminatory access to infrastructure necessary for the provision of commercial services. Article 8 Governmental services 1.Governmental services shall be provided to the Programme participants referred to Article 9(1), (2) and (3). 2.The Commission shall adopt, by means of implementing acts, detailed rules on the provision of governmental services taking into account Article 66 of the Space Programme Regulation and the expected demand for the different use-cases, dynamic allocation of the resources and prioritisation of the governmental services according to relevance and criticality of the users’ needs and, where appropriate, the cost-efficiency. 3.Access to the governmental services shall be free of charge for its users. 4.By way of derogation from paragraph 3, the Commission may, in duly justified cases and on an exceptional basis, determine, by means of implementing acts, a pricing policy. By determining this pricing policy, the Commission shall ensure that the provision of the governmental services does not distort competition, that there is no shortage of the governmental services and that the price identified will not result in an overcompensation of the beneficiary. 5. The implementing acts referred to in paragraphs 2 and 4 of this Article shall be adopted in accordance with the examination procedure referred to in Article 42(2). 6.The provision of governmental services between the users authorised by the same Programme participant shall be determined and implemented by that Programme participant. Article 9 Programme participants and competent authorities 1.Member States, the Council, the Commission and the European External Action Service (EEAS) shall be the Programme participants insofar as they authorise the users of the governmental services. 2.Union agencies and bodies may become the Programme participants insofar as necessary to fulfil their tasks and in accordance with detailed rules laid down in an administrative arrangement concluded between the agency concerned and the Union institution that supervises it. 3.Third countries and international organisations may become the Programme participants in accordance with Article 36. 4.Each Programme participant shall designate one Secure Connectivity Competent authority. That requirement shall be deemed to be complied with by the Programme participants, if they satisfy the following criteria:

(a)they are also GOVSATCOM participants referred to in Article 68 of Regulation (EU) 2021/696; and (b)they have designated a competent authority in accordance with Article 68(4) of Regulation 2021/696. 5.A Secure Connectivity Competent authority referred to in paragraph 4 shall ensure that: (a)the use of services is in compliance with the applicable security requirements; (b)the access rights to the governmental services are determined and managed; (c)user equipment necessary for the use of the governmental services and associated electronic communication connections and information are used and managed in accordance with applicable security requirements; (d)a central point of contact is established to assist as necessary in the reporting of security risks and threats, in particular the detection of potentially harmful electromagnetic interference affecting the services under the Programme. Article 10 Users of the governmental services 1.The following entities may be authorised as users of the governmental services: (a)a Union or Member State public authority or a body entrusted with the exercise of such public authority; (b)a natural or legal person acting on behalf of and under the control of an entity referred to in point (a) of this paragraph. 2.The users of the governmental services referred to in paragraph 1 shall be duly authorised by the Programme participants referred to in Article 9 to use the governmental services and shall comply with the general security requirements referred to in Article 27(2). Chapter III

Budgetary contribution and mechanisms Article 11 Budget 1.The financial envelope for the implementation of the Programme for the period from 1 January 2023 to 31 December 2027 and for covering the associated risks shall be EUR 1,600 billion in current prices. The indicative distribution of the amount from the MFF 2021-27 shall be as follows: –EUR 950 million from Heading 1;

–EUR 500 million from Heading 5; –EUR 150 million from Heading 6. 2.The Programme shall be complemented by funding implemented under the Horizon Europe Programme, the Union Space Programme and the Neighbourhood, Development and International Cooperation Instrument (NDICI) for a maximum indicative amount of EUR 0,430 billion, EUR 0,220 billion and EUR 0,150 billion respectively. This funding shall be implemented in accordance with Regulation (EU) No 2021/695, Regulation (EU) No 2021/696 and Regulation (EU) No. 2021/947 respectively. 3.The amount referred to in paragraph 1 may be used to cover all the activities required to fulfil the objectives referred to in Article 3. Such expenditure may also cover: (a)studies and meetings of experts, in particular compliance with its cost and time constraints; (b)information and communication activities, including corporate communication on the policy priorities of the Union where they are directly linked to the objectives of this Regulation, with a particular view to creating synergies with other Union policies; (c)the information technology networks whose function it is to process or exchange information, and the administrative management measures implemented by the Commission, including in the field of security, implemented by the Commission; (d)technical and administrative assistance for the implementation of the Programme, such as preparatory, monitoring, control, audit and evaluation activities including corporate information technology systems. 4.Budgetary commitments for activities extending over more than one financial year may be broken down over several years into annual instalments. Article 12 Cumulative and alternative funding An action that has received a contribution from another Union programme, including funds under shared management, may also receive a contribution under the Programme, provided that the contributions do not cover the same costs. The rules of the relevant Union programme shall apply to the corresponding contribution to the action. The cumulative funding shall not exceed the total eligible costs of the action. The support from the different Union programmes may be calculated on a pro-rata basis in accordance with the documents setting out the conditions for support. Article 13 Contributions to the Programme 1.The Programme may receive additional financial contributions or contributions in-kind from: (a)Union agencies and bodies; (b)Member States; (c)Third countries participating in the programme; (d)European Space Agency (ESA) or other international organisations in line with relevant agreements. 2.The additional financial contribution referred to in paragraph 1 of this Article and revenues pursuant to Article 8(4) shall be treated as external assigned revenue in accordance with Article 21(5) of Regulation (EU, Euratom) 2018/1046 (the ‘Financial Regulation’).

Article 14 Implementation and forms of Union funding 1.The Programme shall be implemented under direct management in accordance with the Financial Regulation or under indirect management with bodies referred to in the first subparagraph of point (c) of Article 62(1) of the Financial Regulation. 2.The Programme may provide funding in any of the forms laid down in the Financial Regulation, in particular grants, prizes and procurement. It may also provide financing in the form of financial instruments within blending operations. Chapter IV

Implementation of the Programme Article 15 Implementation model 1.The activities set out in Article 4 of this Regulation shall be implemented through contracts awarded in compliance with the Financial Regulation and the principles of procurement under Article 17 of this Regulation. 2.The roles, responsibilities, financial scheme and allocation of risks between the Union and the contractor for their implementation shall be set out in contracts, which may take the form of a concession contract, a supply, service or works contract or a mixed contract, taking into account the ownership regime under Article 16 and the funding of the Programme under Chapter III. 3.The contracts referred to in this Article shall be procured under direct and indirect management and may take the form of an inter-institutional procurement referred to in Article 165(1) of the Financial Regulation, between the Commission and the Agency, whereby the Commission shall assume the role of lead contracting authority. 4.If the procurement procedure referred to in paragraph 2 takes the form of a concession contract and such procedure leads to the failure to conclude the concession contract, the Commission shall restructure the procurement and implement a supply, service or works contract, as appropriate for an optimal implementation of the Programme. 5.Where appropriate, the procurement procedures for the contracts referred to in this Article may also take the form of joint procurements with Member States, accordi