Proposal for a Council Regulation on the establishment of structures for the management of the European satellite radionavigation programme .
Date: 2003-07-31
Institutions: European Commission
Subjects: Community budget, EU office or agency, EU programme, common transport policy, data protection, operation of the Institutions, satellite navigation, supervisory power

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 31.07.2003
COM(2003)471 final

2003/0177 (CNS)

Proposal for a

COUNCIL REGULATION

on the establishment of structures for the management of the European satellite
radionavigation programme

.

(presented by the Commission)

EXPLANATORY MEMORANDUM

It  is  imperative  to  entrust  to  a  public  authority  the  supervision  of  the  deployment  and
operational phases of the European satellite radionavigation system, given its strategic nature
and the need to ensure that essential public interests are adequately defended and represented.

To  this  end,  it  is  proposed  to  set  up  a  Supervisory  Authority  (Chapter  1)  and  a  Centre  or
Security and Safety (Chapter 2).

The Supervisory Authority

Article  2  defines  the  tasks  of  the  Supervisory  Authority  and  the  instruments  placed  at  its
disposal for the accomplishment of these tasks.

The Supervisory Authority will conclude the concession contract with whichever consortium
is selected on completion of the Galileo development phase, in accordance with the procedure
laid down in Article 2(3) of the statutes of the Galileo Joint Undertaking,1 and will take steps
to ensure compliance by that consortium with the obligations arising from that contract.

It will be responsible for managing and controlling the use of the Community funds allocated
to the programme.

Given the importance of system safety and reliability, the Supervisory Authority will draw up,
in  collaboration  with  the  Centre  or  Security  and  Safety  mentioned  in  Article  20  and  the
concessionaire,  procedures  aimed  at  ensuring  compliance  with  the  rules  laid  down  in  these
areas.

Although  there  is  no  question  of  wishing  to  change  the  existing  rules,  Member  States  that
have  lodged  files  with  the  International  Telecommunication  Union  on  the  use  of  the
frequencies  necessary  to  ensure  the  operation  of  the  system  will  authorise  the  Supervisory
Authority to assign the right of exclusive use thereof to the concessionaire. The Authority will
be the sole body dealing with the concessionaire in these matters while at the same time being
responsible for organising the necessary coordination procedures with the Member States.

One  of  the  Supervisory  Authority’s  tasks  will  be  to  assist  the  Commission  in  matters
involving  satellite  radionavigation,  particularly  in  cases  where  legislative  and  regulatory
measures prove necessary.

Article  3  establishes  that  the  Supervisory  Authority  is  the  owner  of  the  entire  satellite
radionavigation system, including whatever may have been developed by the concessionaire
during the deployment phase, unless the concession contract specifically provides otherwise.
In  point  of  fact,  the  Joint  Undertaking,  in  its  capacity  as  owner  of  all  the  tangible  and
intangible assets created or assigned to it during the development phase pursuant to Article 6
of its statutes, will, at the moment of its dissolution on completion of the development phase,
transfer ownership of all these assets to the Supervisory Authority.

1

Council  Regulation  (EC)  No  876/2002  of  21  May  2002  setting  up  the  Galileo  Joint  Undertaking
(OJ L 138, 28.5.2002, p. 1-8).

2

                                                
Under Article 3(1) of this Regulation, the Authority will assign to the concessionaire right of
use but not ownership, which will remain in public hands. This is justified, in particular, on
the  grounds  that  the  programme  definition  and  development  phases  have  been  financed
entirely  from  public  funds  and  all  the  components  thus  developed  will  be  placed  at  the
disposal of the concessionaire. This also  represents a quid pro  quo  for  the  fact  that  a  major
part of the deployment phase would have to be financed from Community appropriations.

Article 4 concerns the legal status of the Supervisory Authority, which is a Community body
whose status is modelled on that of a regulatory agency2 and which has legal personality. Its
seat is located in Brussels and it is empowered to set up offices away from its seat. This may
prove necessary, for instance, at the headquarters of the entity responsibility for designing the
system, and subsequently, at the concessionaire’s location.

Articles 5 and 6 describe the composition, functioning and tasks of the Administrative Board,
which  acts  as  the  Supervisory  Authority’s  control  unit,  with  the  Director  assuming
responsibility for day-to-day management.

Under the provisions of Article 5, the Administrative Board is made up of 12 members: 6 are
appointed by the Commission, and 6 by the Council.

Under  Article  6,  the  Administrative  Board  will  be  in  charge  of  running  the  Supervisory
Authority:

– 

– 

– 

– 

– 

It will appoint the Director, pursuant to Article 7, over whom it will exercise
disciplinary authority;

It will adopt the Financial Regulation of the Supervisory Authority;

It  will  adopt  the  work  programme,  budget  and  organisational  chart  of  the
Supervisory Authority;

It will adopt the the annual general report;

It  will  lay  down  the  rules  governing  the  languages  of  the  Supervisory
Authority;  if  necessary,  it  will  create  and  set  up  the  Scientific  and  Technical
Committee, to which it may entrust research and expert valuation tasks;

– 

It will adopt its own rules of procedure.

Articles  7  and  8  concern  the  Director  of  the  Supervisory  Authority,  who,  having  been
appointed  by  the  Administrative  Board  on  the  basis  of  a  list  proposed  by  the  Commission,
acts as the Authority’s legal representative and is responsible for its day-to-day management
under  the  control  of  the  Administrative  Board.  The  Director  prepares  the  decisions  and
documents to be adopted by the Board and is responsible for directing and managing the staff
of the Supervisory Authority.

2

Commission  Communication  of  11  December  2002  (COM(2002)718  final)  and  Commission
Regulation (EC, Euratom) No 2343/2002 of 19.11.2002.

3

                                                
Under Article 9, the Administrative Board is empowered to set up a Scientific and Technical
Committee bringing together under the auspices of the Supervisory Authority the most highly
qualified experts in satellite radionavigation and related areas, mainly with a view to being in
a position to anticipate potential developments affecting these technologies in the future.

Articles  10  to  13  concern  the  budget  of  the  Supervisory  Authority,  viz.  its  content
(Article  10),  the  procedure  for  its  adoption  (Article  11),  its  execution  (Article  12) and  its
Financial Regulation (Article 13). Article 14 concerns the checks to be carried out with regard
to  the  management  of  the  funds  entrusted  to  the  Supervisory  Authority  by  the  Anti-Fraud
Office and the Court of Auditors.

Article  15  provides  for  the  Protocol  on  Privileges  and  Immunities  to  be  applied  to  the
Supervisory Authority, on the grounds that it is a Community body (Article 4).

Article  16  deals  with  the  status  of  staff  who  will  be  subject  to  the  Regulations  and  rules
applicable to officials and other servants of the European Communities, on the understanding
that the Administrative Board, with the Commission’s agreement, will draw up the necessary
procedural rules.

Article  17  concerns  the  contractual  liability  and  non-contractual  liability  arrangements,  as
well as the arrangements applicable to the staff of the Supervisory Authority.

Under Article 18, Community legislation on access to documents and protection of data of a
personal nature is applied to the Supervisory Authority.

Article  19  seeks  to  enable  countries  which  are  not  members  of  the  European  Union  to
participate in the Supervisory Authority, provided they have concluded a prior agreement to
this  effect  with  the  Community.  Indeed,  countries  such  as  Norway  or  Switzerland  need  to
have a  right  to  participate  in  the  Supervisory  Authority  because  of  their  involvement  in  the
previous  phases  of  Galileo  through  their  contribution  to  the  GalileoSat  programme  of  the
European Space Agency.

The Centre or Security and Safety

The  programme  seeks  to  set  up  a  European  satellite  navigation  system  which  should  be
regarded as a sensitive infrastructure in terms of safety and reliability.

The object of ensuring the safety and reliability of the system is to protect it against attacks
(malicious or otherwise) and to prevent its use for purposes that run counter to the interests of
the European Union and its Member States.

The  pursuit  of  this  objective  necessitates  the  setting-up  of  a  permanent  fully  operational
decision-making  structure  to  deal  with  the  various  elements  of  this  problem  (hereinafter
referred to as the “Centre or Security and Safety”).

Article  20  sets  up,  under  the  auspices  of  the  Secretary-General  of  the  Council  and  without
prejudice  to  what  may  be  decided  at  the  next  Intergovernmental  Conference,  a  Centre  or
Security and Safety to be made up of a permanent small team ready to go into action at any
moment.

4

Article 21 lists the tasks of the Centre or Security and Safety, which include the obligation to
carry  out  expert  assignments  linked  to  the  safety  and  reliability  of  the  system  as  well  as  to
participate in the elaboration of, and promotion of compliance with, a future operational and
regulatory framework in the field of safety and reliability.  It will also need to be capable of
taking  the  measures  required  in  real  time  in  the  event  of  a  crisis,  mainly  in  relation  to  the
operator of the system in association with the Supervisory authority.

Under  Article  22,  the  Secretary-General  of  the  Council  is  entrusted  with  the  task  of  laying
down,  in  association  with  the  Commission,  policy  guidelines  for  this  centre,  which  will  be
placed under his responsibility and in which the Commission will be represented.

In addition to the creation of this Centre or Security and Safety, the Council will be able to
call on COREPER to create, in accordance with Article 19(3) of the rules of procedure3 of the
Council,  a  committee  for  the  safety  and  reliability  of  the  European  satellite  radionavigation
system.  This  committee  will  deal  with  questions  of  safety  and  reliability  affecting  the
European satellite radionavigation system and falling within the jurisdiction of the Council.    

3

OJ L 230, 28.2.2002, p. 7

5

                                                
2003/0177 (CNS)

Proposal for a

COUNCIL REGULATION

on the establishment of structures for the management of the European satellite
radionavigation programme

THE COUNCIL OF THE EUROPEAN UNION

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 308 thereof,

Having regard to the proposal from the Commission4,

Having regard to the opinion of the European Parliament5,

Whereas:

(1) 

(2) 

(3) 

(4) 

The conclusions of the European Council in Cologne (3 and 4 June 1999), Feira (19
and  20  June  2000),  Nice  (7  to  11  December  2000),  Stockholm  (23  and  24  March
2001),  Laeken (14 and  15  December  2001),  Barcelona  (15  and  16  March  2002)  and
Brussels  (20  and  21  March  2003)  have  stressed  the  strategic  nature  of  the  Galileo
satellite radionavigation programme which is cofinanced by the European Union and
the European Space Agency.

It is imperative  to  supervise  the  deployment  and  operational  phases  of  the  European
satellite radionavigation system, given its strategic nature and the need to ensure that
essential public interests are adequately defended and represented.

Galileo  is  the  first  European  space  programme  to  be  financed  and  managed  by  the
European  Union  (in  association  with  the  European  Space  Agency).  It  will  allow  the
development  of  numerous  applications  in  areas  that  are  associated,  directly  or
indirectly, with Community policies, such as transport (positioning and measurement
of  the  speed  of  moving  bodies,  insurance,  motorway  tolls,  law  enforcement
(surveillance  of  suspects,  measures  to  combat  crime,  customs  and  excise  operations
(investigations  on  the  ground,  etc.)  agriculture  (grain  or  pesticide  dose  adjustments
depending on the terrain, etc.), fisheries (monitoring of boat movements).

Accordingly,  while this Community  action would  appear  to  be  necessary  in  order  to
achieve these objectives, the fact remains that the Treaty, in the absence of a specific
space  policy,  has  made  no  provision  for  conferral  of  the  necessary  powers.
Consequently,  Article  308  should  be  invoked  with  a  view  to  the  creation  of  this
Supervisory Authority and this Centre or Security and Safety.

4

5

OJ C […], […], p. […].
OJ C […], […], p. […].

6

                                                
(5) 

(6) 

(7) 

(8) 

(9) 

On a number of occasions, and particularly in its conclusions of 5 April 2001 and 26
March  2002,  the  Council  came  out  in  favour  of  private  sector  participation  in  the
development and operating phases of the programme.

To this end, the Supervisory Authority will be able to conclude a concession contract
with whichever consortium is selected on completion of the Galileo development
phase and take steps to ensure compliance by that consortium with the obligations –
and, in particular, public service obligations – arising from the concession contract.

In view of the requirement that it should own the various system components, it will
assign the right of use thereof to the concessionaire for the duration of the concession.

The Authority will be responsible for managing and controlling the use of the
Community funds allocated to the programme.

There would appear to be a need for Member States that have lodged files with the
International Telecommunication Union on the use of the frequencies necessary to
ensure the operation of the system to assign the right of exclusive use thereof to the
concessionaire, so as to enable the latter to provide the requisite services stipulated in
the specifications, while at the same time being able to rely on a single mouthpiece in
the form of the Supervisory Authority.

(10)  The Supervisory Authority will be able to assist the Commission in matters involving
satellite radionavigation, particularly in cases where legislative and regulatory
measures prove necessary.

(11)  Following the dissolution of the Joint Undertaking (on completion of the development
phase), the Joint Undertaking will transfer to the Supervisory Authority ownership of
the entire satellite radionavigation system (EGNOS and Galileo), including whatever
may have been developed by the concessionaire during the deployment phase; this is
justified on the grounds that the programme definition and development phases have
been financed entirely from public funds and all the components thus developed will
be placed at the disposal of the concessionaire; it also represents a quid pro quo for the
fact that a major part of the deployment phase would have to be financed from
Community appropriations.

(12)  The legal status of the Supervisory Authority should be such as to enable it to act as a

legal person in the discharge of its tasks.

(13)  The  Administrative  Board  will  be  the  Supervisory  Authority’s  control  unit,  with  the

Director assuming responsibility for day-to-day management.

(14)  Provision  needs  to  be  made  for  the  possible  creation  of  a  Scientific  and  Technical

Committee to be responsible for research and expert valuation tasks.

(15)  The Director of the Supervisory Authority will be the latter’s legal representative and
will  see  to  its  day-to-day  management  under  the  control  of  the  Management
Committee.

7

(16)  The  budgetary  and  financial  provisions  applicable  to  the  Supervisory  Authority  will
need  to  be  in  line  with  Commission  Regulation  (EC,  Euratom)  No  2343/2002  of  23
December  2002  on  the  framework  Financial  Regulation  for  the  bodies  referred  to  in
Article  185  of  Council  Regulation  (EC,  Euratom)  No  1605/2002  on  the  Financial
Regulation applicable to the general budget of the European Communities.

(17)  The funds paid to the Supervisory Authority will need to be checked by the Court of

Auditors and by the Anti-Fraud Office (OLAF).

(18)  The  Protocol  on  Privileges  and  Immunities  should  be  applied  to  the  Supervisory

Authority, on the grounds that it is a Community body.

(19)  Staff should be  subject to the  Regulations  and  rules  applicable  to  officials  and  other

servants of the European Communities.

(20)  Steps  must  be  taken  to  ensure  that  the  Supervisory  Authority  complies  with
Community  legislation  governing  access  to  documents  and  with  legislation  on  the
protection of physical persons with regard to the treatment of data of a personal nature.

(21)  Steps should also be taken to make it possible for countries which are not members of
the  European  Union  to  participate  in  the  Supervisory  Authority,  provided  they  have
concluded  a  prior  agreement  to  this  effect  with  the  Community,  particularly  when
these countries have been involved in the previous phases of the programme through
their contribution to the GALILEOSAT programme of the European Space Agency.

(22)  The  European  satellite  radionavigation  system  should  be  regarded  as  a  sensitive

infrastructure in terms of safety and reliability.

(23)  Measures must be put in place to ensure the safety and reliability of the system against
attacks (malicious or otherwise) and to prevent its use for purposes that run counter to
the interests of the European Union and its Member States.

(24)  The  pursuit  of  this  objective  necessitates  the  setting-up  of  a  permanent  fully
operational  decision-making  structure  to  deal  with  the  various  elements  of  this
problem.

(25)  This  operational  structure,  known  as  the  Centre  or  Security  and  Safety,  should,  in
particular, be capable of taking, in real time, such measures as may be required in the
event of a crisis, especially by providing the operator with the necessary instructions
(for  example,  jamming  or  cutting  off  the  signal);  in  addition,  it  will  provide  an
interface  with  the  security  authorities  (European,  Member  State,  third  country  and
Nato) and with the operator.

8

HAS ADOPTED THIS REGULATION:

Chapter 1: The Supervisory Authority

Article 1

Aim and objective

A  Supervisory  Authority  is  hereby  set  up  to  manage  the  public  interests  relating  to  the
European satellite radionavigation programme.

Article 2

Tasks

With  a  view  to  accomplishing  the  objective  set  out  in  Article  1,  the  Supervisory  Authority
shall carry out the following tasks:

– 

– 

– 

– 

– 

– 

It  shall  act  as  a  licensing  authority  vis-à-vis  the  private  concessionaire
responsible  for  implementing  and  managing  the  programme  deployment  and
operating  phases;  under  this  head,  it  shall  conclude  with  the  latter  the
concession  contract;  it  shall  ensure  that  the  concessionaire  complies  with  the
concession  contract  and  the  specifications  annexed  thereto;  it  shall  grant  the
concessionaire the right to use the tangible and intangible assets referred to in
paragraph 1 of Article 3 for the duration of the concession.

It  shall  manage  the  Community  funds  allocated  to  the  European  satellite
radionavigation programme in the phases  following on from the development
phase.

It  shall  assist  the  Centre  or  Security  and  Safety  provided  for  in  Article  22  in
monitoring  compliance  by  the  concessionaire  with  the  safety  and  reliability
rules.

It  shall  act  as  the  depositary  of  all  the  frequencies  necessary  to  ensure  the
operation of the system and will be responsible for coordinating Member State
actions in this respect; it shall deal directly with the concessionaire on matters
relating to the use of these frequencies.

It  shall  assist  the  Commission  in  preparing  the  measures  to  be  taken  for  the
implementation of the European satellite radionavigation programme and shall
provide  it  with  the  technical,  scientific  and  administrative  support  needed  to
accomplish its tasks.

the  Commission  and 

It may  accomplish  such budgetary implementation tasks as are entrusted to it
by 
the  European  satellite
radionavigation programme in accordance with the provisions of Article 54 (2)
(b) of the Financial Regulation applicable to the budget of the European Union.

that  are 

linked 

to 

9

Article 3

Ownership

1.

2.

1.

2.

3.

4.

1.

2.

Unless  the  concession  contract  specifically  provides  otherwise,  the  Supervisory
Authority  shall  be  the  owner  of  all  the  tangible  and  intangible  assets  which  are
transferred to it by the Galileo Joint Undertaking on completion of the development
phase  and  which  may  be  created  or  developed  by  the  concessionaire  during  the
deployment and operational phases.

The procedures governing ensuing transfers of property will, in the case of the Joint
Undertaking,  be  set  out  in  the  course  of  the  winding-up  proceedings  laid  down  in
Article  21  of  the  statutes  of  the  Galileo  Joint  Undertaking  annexed  to  Regulation
(EC) No 876/2002 and, in the case of the concessionaire, in the concession contract.

Article 4

Legal status, seat, local offices

The Supervisory Authority is a Community body with legal personality.

In  each  Member  State,  the  Supervisory  Authority  shall  possess  the  most  extensive
legal  capacity  accorded  to  legal  persons  under  national  law.  It  may,  in  particular,
acquire  or  dispose  of  movable  and  immovable  property  and  be  a  party  to  legal
proceedings.

The seat of the Supervisory Authority shall be located in Brussels. The Supervisory
Authority  may  set  up  its  own  local  offices  in  the  Member  States,  subject  to  the
agreement of the latter.

The Supervisory Authority shall be represented by its Director.

Article 5

The Administrative Board

The Supervisory Authority shall have  an Administrative Board to execute the tasks
listed in Article 6. In addition, the Administrative Board shall assist and monitor the
Director in the execution of his tasks.

The  Administrative  Board  shall  be  made  up  of  twelve  members.  Six  shall  be
appointed by  the Commission, and six  by  the  Council  of  the  European  Union.  The
term of office shall be five years. This term of office shall be renewable once

10

3.

4.

5.

6.

1.

2.

3.

4.

5.

The  Administrative  Board  shall  appoint  a  Chairman  and  a  Vice-Chairman  from
among its members. The Vice-Chairman shall automatically replace the Chairman if
the  latter  is  not  in  a  position  to  perform  his  duties.  The  term  of  office  of  the
Chairman  and  of  the  Vice-Chairman  shall  be  two  and  a  half  years  and  shall  be
renewable. In any event, however, the term of office of the Chairman and that of the
Vice-Chairman  shall  expire  the  moment  they  cease  to  be  members  of  the
Administrative Board.

Meetings  of  the  Administrative  Board  shall  be  convened  by  its  Chairman.
The  Director  of  the  Supervisory  Authority  shall  participate  in  the  deliberations.
The Administrative Board shall meet at least twice a year in ordinary session. It shall
also  meet  at the  initiative  of its Chairman or  at  the  request  of  at  least  a third  of  its
members. The Administrative Board may invite any person with potentially relevant
opinions to attend its  meetings in the capacity  of  an  observer.  The  members  of  the
Administrative  Board  may,  subject  to  the  provisions  of  its  rules  of  procedure,  be
assisted  by  advisers  or  by  experts.  The  Administrative  Board’s  secretarial  services
shall be provided by the Supervisory Authority.

Administrative Board decisions shall be adopted on the basis of a two-thirds majority
of its members.

Each  member  shall  have  one  vote.  The  Director  of  the  Supervisory  Authoriy  shall
not take part in the vote.

The  rules  of  procedure  set  out  in  greater  detail  the  arrangements  governing  voting,
especially the conditions whereby one member can act on behalf of another and also,
where appropriate, the rules governing quorums.

Article 6

The tasks of the Administrative Board

The Administrative Board shall appoint the Director in accordance with Article 7(2).

The  Administrative  Board  shall  adopt,  before  30  September  each  year  and  after
receiving  the  Commission’s  opinion,  the  work  programme  of  the  Supervisory
Authority for the coming  year and shall transmit it to  the  European  Parliament,  the
Council  and  the  Commission;  this  work  programme  shall  be  adopted  without
prejudice to the annual budgetary procedure.

The  Administrative  Board  shall  exercise  its  budgetary  powers  in  accordance  with
Articles 10, 11 and 12.

The  Administrative  Board  shall  decide,  after  having  obtained  the  agreement  of  the
Commission,  on  whether  to  accept  any  legacies,  donations  or  grants  from  other
Community sources.

The Administrative Board shall exercise disciplinary authority over the Director.

11

6.

7.

8.

9.

10.

11.

1.

2.

3.

1.

2.

The Administrative Board shall define the organisational structure of the Supervisory
Authority  and  draw  up  the  Supervisory  Authority’s  staff  policy  pursuant  to
Article 16(1).

The  Administrative  Board  shall  adopt  the  special  provisions  necessary  for  the
implementation of the right of access to the documents of the Supervisory Authority,
in accordance with Article 18.

The  Administrative  Board  shall  adopt  the  annual  report  on  the  activities  and
prospects of the Supervisory Authority and shall transmit it, by 15 June at the latest,
to the  European Parliament,  the  Council,  the  Commission,  the  European  Economic
and Social Committee and the Court of Auditors.

Each  year  the  Supervisory  Authority  shall  transmit  to  the  budgetary  authority  any
relevant information on the results of the assessment procedures.

The Administrative Board shall adopt its own rules of procedure.

The  Administrative  Board  shall  adopt  the  rules  to  be  applied  to  the  Supervisory
Authority regarding the use of languages.

Article 7

The Director

The  Supervisory  Authority  shall  be  managed  by  its  Director,  who  shall  act
independently  in  the  exercise  of  his  functions.  Without  prejudice  to  the  respective
powers of the Commission and the Administrative Board, the Director shall not seek
or accept any instruction from any government or from any official body.

The  Director  shall  be  appointed,  on  the  basis  of  merit  as  well  as  skills  and
experience,  from  a  list  of  candidates  proposed  by  the  Commission;  he  may  be
removed  from  office  by  the  Administrative  Board.  The  Administrative  Board  shall
reach  its  decision  on  the  basis  of  a  majority  of  three  quarters  of  its  members.  The
Director’s  term  of  office  shall  be  five  years.  This  term  of  office  may  be  renewed
once for a maximum period of five years.

Parliament  or  the  Council  may  call  upon  the  Director  to  submit  a  report  on  the
performance of his duties.

Article 9

The tasks of the Director

The  Director  shall  be  responsible  for  representing  the  Supervisory  Authority  and
shall be in charge of its management.

The  Director  shall  prepare  the  work  of  the  Administrative  Board.  He  shall
participate, without having the right to vote, in the work of the Board.

12

3.

4.

5.

6.

7.

8.

1.

2.

3.

1.

2.

The Director shall  be responsible for  implementing  the  annual  work  programme  of
the Supervisory Authority under the control of the Administrative Board.

The  Director  shall  take  the  necessary  measures,  notably  the  adoption  of  internal
administrative  instructions  and  the  publication  of  notices,  so  as  to  ensure
the functioning of the Supervisory Authority in accordance with this Regulation.

The Director shall make an estimate of the revenue and expenditure of the Supervisory
Authority pursuant to Article 11 and shall implement the budget of the Supervisory
Authority pursuant to Article 12.

Each  year  the  Director  shall  prepare  a  draft  general  report  and  shall  submit  it  to
the Administrative Board.

With  regard  to  the  staff  of  the  Supervisory  Authority,  the  Director  shall  exercise
the powers provided for in Article 16.

With  the  approval  of  the  Administrative  Board,  he  may  adopt  decisions  on
the establishment of local offices in the Member States in accordance with Article 4.

Article 9

The Scientific and Technical Committee

The  Administrative  Board  may  set  up  a  Scientific  and  Technical  Committee  and
appoint  its members and  chairman  from  among  acknowledged  experts  in  the  fields
on which the Committee will be called upon to give a ruling.

At the request of the Administrative Board, the Scientific and Technical Committee
may be given responsibility for:

– 

– 

– 

delivering  opinions  on  technical  questions  or  on  proposals  involving  major
changes in the design of the European satellite radionavigation system;

making recommendations on the modernisation of the system;

carrying out any  other task  necessary  for  the  development  of  expertise  in  the
area of satellite radionavigation.

Subject  to  approval  by  the  Administrative  Board,  the  Scientific  and  Technical
Committee shall draw up its own rules of procedure.

Article 10

Budget of the Supervisory Authority

All Supervisory Authority revenue and expenditure shall be the subject of forecasts
for each financial year, coinciding with the calendar year, and shall be entered in its
budget.

The budget shall be balanced in terms of revenue and expenditure.

13

3.

4.

1.

2.

3.

4.

5.

1.

2.

Without prejudice to other resources and dues yet to be defined, revenue accruing to
the  Supervisory  Authority  shall  include  a  Community  grant  entered  in  the  general
budget  of  the  European  Community  in  order  to  ensure  a  balance  between  revenue
and expenditure.

In  particular,  Supervisory  Authority  expenditure  shall  cover  staff  remuneration,
administrative  and  infrastructure  expenditure,  operating  costs  and  expenditure
associated  with  the  functioning  of  the  Scientific  and  Technical  Committee  and  the
contracts and grant agreements concluded by the Supervisory Authority with a view
to implementing the European satellite radionavigation programme.

Article 11

Establishment of the budget

Each year the Administrative Board, on the basis of a draft prepared by the Director,
shall make an estimate of the revenue and expenditure of the Supervisory Authority
for the following financial year. These estimates, including a draft list of posts, shall
be transmitted  by  the  Administrative  Board  to  the  Commission  by  31  March  at  the
latest.

The  estimates  shall  be  transmitted  by  the  Commission  to  the  European  Parliament
and to the Council (hereinafter referred to as the budgetary authority) together with
the preliminary draft general budget of the European Union.

On  the  basis  of  the  estimates,  the  Commission  shall  enter  in  the  preliminary  draft
general  budget  of  the  European  Union  the  predictions  it  considers  necessary  in
respect  of  the  list  of  posts  and  the  amount  of  the  grant  to  be  charged  to  general
budget in accordance with Article 272 of the Treaty.

The budgetary authority shall authorise the appropriations under the grant allocated
to the Supervisory Authority.

The budgetary authority shall draw up the list of posts of the Supervisory Authority.

The  budget  of  the  Supervisory  Authority  shall  be  drawn  up  by  the  Administrative
Board. It shall become definitive after the final adoption of the general budget of the
European Union. Where necessary, it shall be adjusted in consequence.

Article 12

Implementation and control of the budget

The Director shall implement the budget of the Supervisory Authority.

Not  later  than  1  March  following  the  completion  of  the  financial  year,  the
Supervisory  Authority  accounting  officer  shall  forward  the  provisional  accounts,
accompanied by the report on budgetary and financial management over the financial
year,  to  the  Commission  accounting  officer.  The  latter  shall  then  consolidate  the
provisional accounts of the institutions and decentralised bodies in accordance  with
Article 128 of the general Financial Regulation.

14

3.

4.

5.

6.

7.

8.

9.

Not  later  than  31  March  following  the  completion  of  the  financial  year,  the
Commission  accounting  officer  shall  forward  the  provisional  accounts  of  the
Supervisory  Authority,  accompanied  by  the  report  on  budgetary  and  financial
management  over  the  financial  year,  to  the  Court  of  Auditors.  The  report  on
budgetary and financial management over the financial year shall also be forwarded
to the European Parliament and the Council.

After receiving the observations of the Court of Auditors on the provisional accounts
of the Supervisory Authority in accordance with the provisions of Article 129 of the
general  Financial  Regulation,  the  Director,  acting  on  his  own  responsibility,  shall
draw up the definitive accounts of the Supervisory Authority and transmit them, for
opinion, to the Administrative Board.

The Administrative Board shall deliver an opinion on the definitive accounts of the
Supervisory Authority.

The Director shall transmit these definitive accounts, accompanied by the opinion of
the  Administrative  Board,  not  later  than  1  July  following  the  completion  of  the
financial  year,  to  the  European  Parliament,  the  Council,  the  Commission  and  the
Court of Justice.

The definitive accounts shall be published.

The Director shall send the Court of Auditors a reply to the latter’s observations by
30  September  at  the  latest.  He  shall  also  send  a  copy  of  this  reply  to  the
Administrative Board.

The Director shall submit to the European Parliament, at the latter’s  request and  as
provided for in Article 146(3) of the  general  Financial Regulation, any information
necessary for the smooth running of the discharge procedure for the financial year in
question.

10.

The European Parliament, following a recommendation from the Council acting on a
qualified majority, shall, before 30 April of the year N + 2, grant a discharge to the
Director for the implementation of the budget for the financial year N.

Article 13

Financial Regulation

The  financial  regulations  applicable  to  the  Supervisory  Authority  shall  be  drawn  up  by  the
Administrative  Board  after  consultations  with  the  Commission.  These  regulations  may
deviate from Commission Regulation (EC, Euratom) No 2343/2002 of 19 November 2002 on
the  framework  Financial  Regulation  for  the  bodies  referred  to  in  Article  185  of  Council
Regulation  (EC,  Euratom)  No  1605/2002  on  the  Financial  Regulation  applicable  to  the
general budget of the European Communities only if the specific needs for the functioning of
the Supervisory Authority so require and subject to the prior agreement of the Commission.

15

Article 14

Anti-fraud measures

1.

2.

3.

For the purposes of combating fraud, corruption and other illegal acts, the provisions
of Regulation (EC) No 1073/1999 of the European Parliament and of the Council of
25  May  1999  concerning  investigations  conducted  by  the  European  Anti-Fraud
Office (OLAF) shall apply without restriction.

The Supervisory Authority shall comply with the Interinstitutional Agreement of 25
May  1999  concerning  internal  investigations  by  the  European  Anti-Fraud  Office
(OLAF)  and  shall  immediately  adopt  appropriate  provisions  that  shall  apply  to  all
staff of the Supervisory Authority.

The  funding  decisions,  the  agreements  and  the  implementing  instruments  resulting
therefrom stipulate specifically that the Court of Auditors and OLAF may, if need be,
carry  out  on-the-spot  checks  on  the  beneficiaries  of  monies  disbursed  by  the
Supervisory Authority as well as on the staff responsible for allocating these monies.

Article 15

Privileges and immunities

The Protocol on Privileges  and  Immunities of the European  Communities shall apply to the
Supervisory Authority.

Article 16

Staff

1.

2.

3.

The  Staff  Regulations  of  Officials  of  the  European  Communities,  the  regulations
applicable  to  other  servants  of  the  European  Communities  and  the  rules  adopted
jointly  by  the  European  Community  institutions  for  the  purpose  of  applying  these
regulations  shall  apply  to  the  staff  of  the  Agency.  The  Administrative  Board,  in
agreement with the Commission, shall adopt the necessary implementing measures.

Without  prejudice  to  Article  8,  the  powers  conferred  on  the  appointing  authority
under the Staff Regulations and the regulations applicable to other servants shall be
exercised by the Supervisory Authority with respect to its own staff.

The  staff  of  the  Supervisory  Authority  shall  be  made  up  of  officials  assigned  or
seconded by the Commission or the Member States on a temporary basis and of other
staff recruited as need be by the Supervisory Authority to perform its tasks.

16

Article 17

Liability

1.

2.

3.

4.

1.

2.

3.

4.

Contractual  liability  on  the  part  of  the  Supervisory  Authority  shall  be  governed  by
the  law  applicable  to  the  contract  in  question.  The  Court  of  Justice  shall  have
jurisdiction by virtue of any arbitration clause contained in a contract entered into by
the Supervisory Authority.

In the event of non-contractual liability, the Supervisory Authority shall take steps, in
accordance with the general principles common to the laws of the Member States, to
remedy any damage caused by its departments or by  its staff in the performance of
their  duties.  The  Court  of  Justice  shall  have  jurisdiction  in  any  dispute  over  the
remedying of such damage.

The  personal  liability  of  its  staff  vis-à-vis  the  Supervisory  Authority  shall  be
governed by the provisions of the various regulations applicable to those staff.

The Court of Justice shall have jurisdiction in disputes over the remedying of damage
referred to in paragraph 3.

Article 18

Access to documents and protection of data of a personal character

Regulation  (EC)  No  1049/2001  of  the  European  Parliament  and  of  the  Council  of
30 May  2001  regarding  public  access  to  European  Parliament,  Council  and
Commission documents shall apply to documents held by the Supervisory Authority.

The  Administrative  Board  shall  adopt  practical  measures  for  applying  Regulation
(EC) No 1049/2001 within six months from the date of entry into force of Regulation
(EC) No … on the establishment of structures for the management of the European
satellite radionavigation programme.

Decisions taken by the Supervisory Authority in pursuance of Article 8 of Regulation
(EC)  No  1049/2001  may  be  the  subject  of  a  complaint  to  the  mediator  or  of
proceedings before the Court of Justice, in accordance with the conditions laid down
in Articles 195 and 230 respectively of the Treaty.

The  processing  of  data  of  a  personal  nature  by  the  Supervisory  Authority  shall  be
subject to the provisions of Regulation (EC) No 45/2001 of the European Parliament
and of the Council of 18 December 2000 on the protection of individuals with regard
to the processing of personal data by the Community institutions and bodies and on
the free movement of such data.

17

Article 19

Participation of third countries

The  Supervisory  Authority  shall  be  open  to  the  participation  of  countries  which  are  not
members  of  the  European  Union  and  which  have  concluded  agreements  with  the  European
Union to this effect.

Under  the  relevant  provisions  of  these  agreements,  arrangements  shall  be  worked  out
specifying, in particular, the nature, scope and procedural aspects of the involvement of these
countries in the work of the Supervisory Authority, including provisions relating to financial
contributions and to staff.

Chapter 2: The Centre or Security and Safety

Article 20

Setting-up of the Centre or Security and Safety

A Centre or Security  and Safety –  permanent  and operational  –  is  hereby  created  under  the
auspices of the Secretary-General of the Council.

Article 21

Tasks of the Centre or Security and Safety

The Centre or Security and Safety shall be responsible for carrying out the following tasks:

– 

– 

– 

– 

– 

– 

giving instructions to the operator of Galileo to ensure the safety and reliability
of  the  system,  in  particular  by  compelling  the  operator  to  take  such  signal
scrambling or interruption measures as may be required in the event of a crisis;

contributing  to  the  actions  relating  to  the  safety  of  the  European  satellite
radionavigation system, and, in particular, monitoring the specifications of the
system (architecture and safety of the system constituents);

where  necessary,  and  without  prejudice  to  Article  300  of  the  EC  Treaty,
providing the Commission with technical expertise in its ongoing negotiations
with third States with regard to aspects relating to the safety of the European
satellite radionavigation system;

being consulted on the safety annexes to contracts already concluded, or yet to
be concluded, with a view to setting up the system;

being  consulted  on  the  technical  specifications  of  the  government  service
(public  regulated  service)  and  the  procedures  and  means  of  identifying  the
users;

defining 
(development, design, validation of cryptologic components);

type  of  cryptology 

that 

the 

requires  government  approval

18

– 

performing any other task in this area entrusted to it by the Council.

Article 22

Composition and operation of the Centre or Security and Safety

The Secretary-General of the Council, in liaison with the Commission, shall determine the
composition and operational procedures of the Centre or Security and Safety, and in particular
the possibility of the Commission being represented within it.

Article 23

Entry into force

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

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

Done at Brussels,

For the Council
The President

19

Annex 1

LEGISLATIVE FINANCIAL STATEMENT

Policy area(s): TRANSPORT AND ENERGY

Activity(ies): Galileo Programme deployment and operational phase

TITLE OF OPERATION:

PROPOSAL  FOR  A  COUNCIL  REGULATION  ON  THE
ESTABLISHMENT  OF  STRUCTURES  FOR  THE  MANAGEMENT
OF  THE  EUROPEAN 
SATELLITE  RADIONAVIGATION
PROGRAMME

1.

BUDGET LINE(S) + TITLE(S)

Under Chapter 06 03 Trans-European Networks

Creation  of  the  appropriate  structure  for  the  Supervisory  Authority  (regulatory
agency), i.e.:

– 

– 

– 

creation of an item 06 03 XX entitled “Supervisory Authority”

creation  of  an  item  06  03  XX  XX  –  entitled  “Supervisory  Authority”  –
Grant Titles 1 and 2

creation  of  an  item  06  03  XX  XX  –  entitled  “Supervisory  Authority”  –
Grant Title 3

The choice of article and items, under Chapter 06 03, will be determined under the
budget procedure for 2006.

2.

2.1

OVERALL FIGURES

Allocation for the action: €3.55 millio n/year in commitment appropriations

This  annual  allocation  is  included  in  the  appropriations  entered  under  Article
06 03 01 for the year 2006 (financial allocation for the period 2000-2006 laid down
by regulation) and will possibly be included in the future in the financial allocation to
be fixed for subsequent years.

2.2

Period of application

The action will be of unlimited duration (annual grant)

2.3

Overall multiannual estimate on expenditure:

a) Schedule of commitment appropriations / payment appropriations (financial intervention)

20

in € millions

Year

2006

2007

2008

2009

Subsequentfinanc
ial years

Commitment
appropriations

Payment
appropriations

3.55

3.55

3.55

3.55

3.55

3.55

3.55

3.55

3.55

3.55

2.4

Compatibility with financial programming and the financial perspective

x

Proposal compatible with existing financial programming (2000/2006)

2.5

Financial impact on revenue

x

No financial implications

3.

BUDGET CHARACTERISTICS

Type of expenditure

New

Participation
EFTA

Participation
applicant
countries

Heading
Financial
Perspective

NCE

DA/NDA

YES

YES

YES

No 3          

4.

LEGAL BASIS

EC Treaty: Article 308

5.

5.1

DESCRIPTION AND GROUNDS

Need for Community intervention

5.1.1 Objectives pursued

It  is  imperative  to  entrust  to  a  public  authority  the  supervision  of  the  deployment  and
operational phases of the European satellite radionavigation system, given its strategic nature
and the need to ensure that essential public interests are adequately defended and represented.

This  public  authority  -  to  be  known  as  the  Supervisory  Authority  -  will  conclude  the
concession  contract  with  whichever  consortium  is  selected  on  completion  of  the  Galileo
development  phase  and  will  take  steps  to  ensure  compliance  by  that  consortium  with  the
obligations  arising  from  the  concession  contract;  in  its  capacity  as  owner  of  the  various
system components, it will be required to assign the right of use thereof to the concessionaire
for the duration of the concession.

21

          
          
          
          
It will be responsible for managing and controlling the use of the Community funds allocated
to the programme.

Given the importance of system safety and reliability, the Supervisory Authority will draw up,
in  collaboration  with  the  crisis  management  centre  mentioned  in  Article  20  and  the
concessionaire,  procedures  aimed  at  ensuring  compliance  with  the  rules  laid  down  in  these
areas.

It will coordinate the actions and positions to be defended by Member States that have lodged
files with the International Telecommunication Union on the use of the frequencies necessary
to  ensure  the  operation  of  the  system;  in  addition,  these  Member  States  will  authorise  the
Supervisory Authority to assign the right of exclusive use thereof to the concessionaire.

One  of  the  Supervisory  Authority’s  tasks  will  be  to  assist  the  Commission  in  matters
involving  satellite  radionavigation,  particularly  in  cases  where  legislative  and  regulatory
measures prove necessary.

5.1.2 Measures taken in connection with ex ante evaluation

The proposed mechanism is the result of numerous discussions with all the players involved
in the Galileo Programme and is based on the framework set out in the conclusions reached at
the meeting of the Transport Council on 4 and 5 April 2001.

5.2

Actions envisaged and arrangements for budget intervention

With  a  view  to  accomplishing  its  objectives,  the  Supervisory  Authority  will  carry  out  the
following measures:

– 

– 

– 

– 

It  will  act  as  a  licensing  authority  vis-à-vis  the  private  concessionaire
responsible  for  implementing  and  managing  the  programme  deployment  and
operating  phases;  under  this  head,  it  will  conclude  with  the  latter  the
concession  contract;  it  will  ensure  that  the  concessionaire  complies  with  the
concession  contract  and  the  specifications  annexed  thereto;  it  will  grant  the
concessionaire  the  right  to  use  the  tangible  and  intangible  assets  for  the
duration of the concession.

It  will  manage  the  Community  funds  allocated  to  the  European  satellite
radionavigation programme in the phases  following on from the development
phase.

It  will  assist  the  Centre  or  Security  and  Safetyi  in  monitoring  compliance  by
the concessionaire with the safety and reliability rules.

It  will  act  as  the  custodian  of  all  the  frequencies  necessary  to  ensure  the
operation of the system and will be responsible for coordinating Member State
actions in this respect; it will deal directly with the concessionaire on matters
relating to the use of these frequencies.

– 

It will carry out any other task entrusted to it by the Commission.

All  Supervisory  Authority  revenue  and  expenditure  are  the  subject  of  forecasts  for  each
financial year, coinciding with the calendar year, and are entered in its budget.

22

The  budget  is  balanced  in  terms  of  revenue  and  expenditure.  Without  prejudice  to  other
resources and dues yet to be defined, revenue accruing to the Supervisory Authority includes
a  Community  grant  entered  in  the  general  budget  of  the  European  Community  in  order  to
ensure a balance between revenue and expenditure.

In particular, Supervisory Authority expenditure covers staff remuneration, administrative and
infrastructure expenditure, operating costs and expenditure associated with the functioning of
the  Scientific  and  Technical  Committee  and  the  contracts  concluded  with  institutions  or
companies  responsible  for  implementing  the  Galileo  European  satellite  radionavigation
programme.

5.3

Methods of implementation

The legal status of the Supervisory Authority should be such as to enable it to act as a legal
person in the discharge of its tasks.

1. 

An Administrative Board will serve as the Supervisory Authority’s control unit. The
Administrative  Board  is  made  up  of  12  members.  Six  are  appointed  by  the
Commission, and six by the Council. The term of office is five  years.  This term of
office is renewable once.

The Supervisory Authority is headed by a Director appointed by the Administrative Board for
a  period  of  five  years,  renewable  once.  The  Director  is  the  legal  representative  of  the
Supervisory Authority.

Provision  will  also  need  to  be  made  for  the  possible  creation  of  a  Scientific  and  Technical
Committee  to  be  responsible  for  research  and  expert  valuation  tasks.  At  the  request  of  the
Management  Committee,  the  Scientific  and  Technical  Committee  may  be  made  responsible
for:

– 

– 

– 

delivering  opinions  on  technical  matters  or  on  proposals  involving  major
changes in the design of the European satellite radionavigation system;

making recommendations on how to modernise the system;

carrying out any  other task  necessary  for  the  development  of  expertise  in  the
area of satellite radionavigation.

6.

6.1

FINANCIAL IMPACT

Method of calculating the total cost of the action (To be determined by DG BUDG
and DG ADMIN)

The  Supervisory  Authority’s  annual  costs  will  be  covered  by  the  Community  grants.  The
various types of expenditure can be analysed as follows:

23

Staff expenditure

The proposed budget is based on an estimated staff of 206, and this evaluation is based on a
comparison  with  other  structures  linked  to  the  management  of  the  Galileo  Programme
(such as the Galileo Interim Support Structure (GISS) and the Galileo Joint Undertaking).

The  assessment  of  staff  costs  is  based  on  the  annual  costs  for  categories  A3,  A4-5,  A6-7,
B2-3,  C1-3;  the  high  proportion  of  staff  in  the  upper  A  echelons  reflects  the  high  level  of
scientific competence required by the Authority for the effective execution of its tasks.

TABLE: Estimate of human resources

GRADES

Director of the Supervisory Authority

Scientific staff

Administrative staff

TOTAL

A

1

13

1

15

B

C

TOTAL

1

13

6

20

2

2

3

3

Total annual staff expenditure is estimated at €2.2 million, taking as the average the cost of
European  Commission  staff,  i.e.  €0.108  milli on  per  year,  which  includes  expenditure
associated  with  buildings  and  related  administrative  expenditure  (mailing  charges,
telecommunications, IT, etc.).

Capital expenditure

Expenditure  relating  to  the  acquisition  of  movable  property  and  associated  expenditure  will
not be very high, since all the equipment purchased in connection with the functioning of the
Galileo  Joint  Undertaking  will  be  transferred  to  the  Supervisory  Authority.  Accordingly,  a
sum of €150 000 per year has been se t aside to cover additional costs.

Operating costs

These costs cover meetings and studies, as well as translation, publication and public relations
costs. Based on preliminary estimates, these operating costs come to €1 million per year.

6

These  staff  will  be  recruited  as  temporary  staff,  in  accordance  with  the  rules  applicable  to
Commission staff.

24

                                                
Mission expenditure

In  order  to  discharge  its  tasks,  the  Supervisory  Authority  will  need  to  organise  trips  both
inside and outside the EU (transport and accommodation costs). The mission expenses budget
is  estimated  to  come  to  €200 000  per  year.  These  estimates  are  based  on  actual  average
mission expenses costs attributed to DG TREN.

6.2

Breakdown  by  elements  of  the  action  (To  be  determined  by  DG  BUDG  and
ADMIN)

Commitment appropriations in euros (at current prices)

Breakdown/ categories

Year 2006

Year 2007

Year 2008

Year 2009

Subsequent
financial
year

Staff expenditure

2.200.000

2.200.000

2.200.000

2.200.000

Equipment

150.000

150.000

150.000

150.000

Operating expenditure

1.000.000

1.000.000

1.000.000

1.000.000

Mission expenditure

200.000

200.000

200.000

200.000

Total

3.550.000

3.550.000

3.550.000

3.550.000

6.3

Schedule of commitment appropriations / payment appropriations

in millions of euros

 Years 2006 –2009

2006

2007

2008

2009

Subsequent
years

et seq.

Commitment appropriations

3.55

3.55

3.55

3.55

Payment appropriations

Year 

et seq.

Total

2006

3.55

3.55

3.55

3.55

Subsequent
years

3.55

3.55

3.55

3.55

25

7.

FOLLOW-UP AND EVALUATION

The management of the funds entrusted to the Supervisory Authority comes under the control
of the Court of Auditors (Article 12), the European Parliament (Article 12) and the European
Anti-Fraud Office (Article 14).

8.

ANTI-FRAUD MEASURES

See point 7 above.

26