Communication from the Commission to the European Parliament and the Council - Progress report on the GALILEO research programme as at the beginning of 2004
Date: 2004-02-18
Institutions: European Commission
Subjects: EU programme, EU research policy, research programme, satellite navigation

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 18.2.2004 
COM(2004) 112 final 

COMMUNICATION FROM THE COMMISSION 
TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 

Progress report on the GALILEO research programme as at the beginning of 2004 

EN 

   EN 

 
 
 
  
Introduction 

The GALILEO research programme (GALILEO programme) has a threefold dimension: it is 
technological, political and economic. All sectors of the economy and the various components 
of our society are affected by the development of satellite radionavigation which, according to 
all the estimates, is expected to grow and grow. The market in products and services linked to 
this technology, which is already of the order of €10 thousand million per year, is growing at 
an annual rate of 25% and is due to rise to about €300 thousand million in 2020. Some 3 000 
million receivers should be in service by 2020. The number of jobs created as a result of the 
European  system  of  satellite  radionavigation  should  be  in  the  region  of  100  000.  Satellite 
radionavigation  has  become  part  and  parcel  of  the  daily  life  of  European  citizens,  featuring 
not  only  in  their  cars  and  portable  telephones  but  also  in  their  banking  habits  and  the  civil 
protection  systems  which  look  after  their  security  –  all  of  which  confers  on  the  GALILEO 
programme an additional citizens’ dimension. 

The three successive phases in the programme, the total cost of which comes to €3.2 thousand 
million, are the following: 

•  a development and validation phase covering the development of the satellites and 
the  system’s  ground  components,  as  well  as  validation  in  orbit.  This  phase  runs 
from 2002 to 2005. Half of its cost of €1 100 million is being met by the European 
Community, with the other half coming from the European Space Agency; 

•  a  deployment  phase  covering  2006  and  2007  and  involving  the  building  and 
launching  of  the  satellites  and  the  establishment  of  the  entire  ground-based 
component.  The  cost  of  €2 100  million  should  be  borne  mainly  by  the  future 
system concessionaire;  

•  a commercial operating phase due to begin in 2008. 

The  European  Parliament  and  the  Council  are  briefed  regularly  by  the  Commission  on  the 
GALILEO programme. On 29 January 2004, on the basis of the last two communications, 1 
the  European  Parliament  adopted  a  resolution  supporting  the  Commission’s  approach  and 
reiterating  the  strategic  importance  of  this  major  infrastructure  project  for  the  future  of 
Europe.  On  5  and  6  December  2002  and  5  June  2003,  2  for  its  part,  the  Council  adopted 
conclusions  encouraging  the  policy  pursued  by  the  Commission  both  towards  the  EGNOS 
programme and towards the GALILEO programme.  

As far as the programme is concerned, 2003 has been a decisive year marking, in particular, 
the  setting-up  of  the  Galileo  Joint  Undertaking  (the  Joint  Undertaking)3  and  the 
commencement  of  its  work,  the  order  of  the  first  satellites,  the  promotion  of  international 
cooperation,  the  confirmation  of  frequencies  allocated  and  preparations  for  the  deployment 
and operating phases. 

1 

2 
3 

Communication  of  24  September  2002  on  the  state  of  progress  of  the  GALILEO  programme 
(COM(2002)  518  final)  and  communication  on  the  integration  of  the  EGNOS  programme  in  the 
GALILEO programme (COM(2003) 123 final). 
Document 10736/03 
Setting  up  of  the  Galileo  Joint  Undertaking  by  Council  regulation  876/2002  published  in  OJ  L  138, 
28.05.2002, page 1 

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The communication revolves round the following three points: 

–  progress of the development phase; 

–  development of international cooperation; 

–  transition to the deployment and operating phases. 

1. 

THE DEVELOPMENT PHASE IS AT A VERY ADVANCED STAGE 

Having  weathered  the  storm  associated  with  the  difficulties  linked  to  determining  the 
financial scale within the European Space Agency, the development phase of the GALILEO 
programme is now at a very advanced stage. The Joint Undertaking has been fully operational 
since  summer  2003.  The  technical  studies  and  research  work  are  actively  going  ahead, 
encouraged  by  the  positive  results  achieved  at  the  World  Radiocommunication  Conference 
held in June 2003.At the same time, the integration of the new Member States and candidate 
countries in the GALILEO programme is well under way. 

1.1. 

The actual setting-up of the Joint Undertaking 

1.1.1.  The initial work of the Joint Undertaking 

Following the agreement on 26 May 2003 within the Council of the European Space Agency 
on  the  respective  financial  contributions  of  the  Agency  Member  States  to  the  development 
phase, the steps necessary for setting up the Joint Undertaking were taken without delay. 

On 16 June 2003, Mr Rainer Grohe was appointed Director of the Joint Undertaking by the 
latter’s Administrative Board. On 15 July 2003, he put forward ideas on his organisation chart 
and adopted his budget for 2003 and 2004. 

The Joint Undertaking has been fully operational since summer 2003. Its staff is made up 30 
or  so  persons  spread  over  four  departments  responsible  for  technical  matters,  commercial 
development, award of concessions and administration and finance, respectively. Its premises 
are  situated  in  Brussels.  On  28  July  2003,  in  accordance  with  Article  3  of  its  Statutes,  it 
signed an agreement with the European Space Agency on the activities to be carried out by 
the  latter  during  the  development  phase  with  regard  to  the  space  segment  and  the  earth 
segment associated with the system. It also launched the first call for proposals on the use of 
the funds provided under the Sixth Framework Programme for research and development (cf. 
point 1.2.3 below) and the procedure for awarding concessions with regard to the programme 
development and operating phases (cf. point 3.1 below). 

1.1.2.  The question of exemptions 

At the Transport Council meeting held on 26 March 2002, and with regard to the Regulation 
setting  up  the  Joint  Undertaking,  as  finally  adopted  on  21  May  2002,  the  Council  and  the 
Commission, on the one hand, and Belgium, on the other, made a declaration of commitment 
to  exempt  the  Joint  Undertaking  and  its  staff  from  all  taxes  and  social  charges  or  similar 
obligations, to the extent that this was compatible with Community law and national law. 

As a result of the discussions embarked on by the Commission with the Belgian authorities, 
the question of VAT and excise duties was swiftly resolved.  

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As regards social contributions and deductions at source to be levied by the Joint Undertaking 
on  staff  remunerations,  a  formal  proposal  from  the  Belgian  authorities  is  still  pending,  4 
notwithstanding  several  meeting,  exchanges  of  letters  and  the  issuing  of  a  reminder  of  the 
outcome of the Transport Council meeting held on 5 December 2003. The sum of the amounts 
in  question  is  far  from  negligible  and  comes  to  about  €5  million  a  year.  It  would  be 
inconceivable if the Community appropriations allocated to the GALILEO programme were 
to be used in part for payment, by the Joint Undertaking, of taxes and other charges for the 
benefit of the Member State in which its head office is situated. 

1.2. 

Continuation of the technical studies and research work 

The latest studies undertaken as part of the definition phase are now complete. The technical 
studies and research work being carried out in the context of the development and validation 
phase  have  begun  in  accordance  with  the  prearranged  timetable,  both  as  regards  the 
infrastructure  itself  and  the  associated  downstream  segment.  At  the  same  time,  the  EGNOS 
system will soon be operational, and a European radionavigation schedule is in preparation. 

1.2.1.  Recent work under the definition phase 

The “Galilei” and “GalileoSat phase B2” studies were concluded on 10 and 11 July 2003. 

The  “Galilei”  study  has  helped  to  enshrine  the  presence  of  the  GALILEO  system5  on  the 
international stage, such as UIT6 and ICAO7, to conduct detailed analyses and simulations on 
the question of interoperability with other radionavigation systems, to lay down specifications 
for the local components of the infrastructure and to identify more precisely the international 
markets in equipment and services. 

The  “Galileosat  phase  B2”  study,  for  its  part,  has  enabled  the  European  Space  Agency  to 
define in great detail the space infrastructure and the associated ground-based segment. 

1.2.2.  Work and studies relating to the basic infrastructure 

The  in-orbit  validation  phase  began  in  earnest  on  11  July  2003  with  the  signature,  by  the 
European  Space  Agency,  of  the  contracts  for  the  acquisition  of  the  first  two  experimental 
satellites.  The  first  of  these  satellites  is  due  to  be  launched  before  the  end  of  2005.  By 
transmitting in orbit before summer 2006, these two satellites will ensure the maintenance of 
the  frequency  allocations  obtained  at  the  last  two  World  Radiocommunication  Conferences. 
They will also help to validate the essential functions of the on-board equipment, notably the 
signal generator and the atomic clocks. 

In the event of failure or malfunction affecting any of them, the two satellite control systems 
will ensure the allocation of the frequencies obtained, while at the same time introducing an 
element of competition among the various manufacturers. 

4 

5 

6 
7 

For  the  moment,  two  possibilities  can  be  envisaged:  either  a  contribution  paid  by  Belgium  to  the 
GALILEO  Joint  Undertaking  and  equivalent  to  the  amount  of  the  charges  paid  by  the  latter,  or  the 
application  by  Belgium  of  the  Protocol  on  Privileges  and  Immunities,  on  the  grounds  that  the  Joint 
Undertaking was set up by a Community Regulation on the basis of Article 171 of the Treaty. 
GALILEO system : infrastructure composed by the satellites of the constellation and terrestrial stations 
associated to its functioning. 
Union Internationale des Télécommunications 
International Civil Aviation Organisation 

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The European Space Agency has also embarked on the preliminary part of the development 
and validation phase. During 2004, it will be launching the calls for tender covering the whole 
of this final phase. Under the supervision of the Joint Undertaking, it will make sure that the 
contracts respect the principles of non discrimination, transparency and equal distribution of 
work, taking into account the European nature of the programme. 

At  the  same  time,  the  European  Space  Agency  is  pursuing  technological  developments 
involving  various  components  of  the  space  segment  and  the  ground-based  segment  of  the 
infrastructure, as well as the construction of a variety of simulators. 

1.2.3.  Work and research relating to satellite radionavigation applications 

Following  the  research  carried  out  under  the  Fifth  Framework  Programme  for  research  and 
development  on  satellite  radionavigation  applications,  including  those  of  the  technological 
programme  of  the  Information  Society,  the  Joint  Undertaking  has  signed  contracts  resulting 
from the first call for proposals on the use of the funds provided under the Sixth Framework 
Programme  for  research  and  development.  Five  research  areas  were  defined  in  conjunction 
with  the  European  Space  Agency’s  ARTES8  programme:  development  of  receivers, 
experiments involving the local components of the infrastructure, promotion of future services 
generated by the GALILEO system thanks to the use of EGNOS, development of the satellite 
radionavigation  market  and  definition  of  the  tasks  assigned  to  the  system  in  the  various 
sectors of activity. 

Furthermore,  numerous  players  involved  with  satellite  radionavigation  have  been  consulted 
over the last few months, such as motor vehicle manufacturers, mobile telephone companies, 
digital  cartography  producers,  persons  with  reduced  mobility,  manufacturers  of  work-site 
machines, stakeholders in intelligent transport, agricultural and fishing interests, insurers and 
banking institutions, authorities responsible for civil protection and the railway community. 

Owing  to  its  unique  characteristics,  the  future  European  system  of  satellite  radionavigation 
offers  new  monitoring,  control  and  management  possibilities  in  a  wide  variety  of  sectors, 
thereby  authorising  new  services  and  new  rules.  Thus,  the  proposal  for  a  Directive  on 
electronic  road  toll  systems  makes  wide  use  of  the  technical  capabilities  associated  with 
satellite navigation. A detailed examination of the Community rules likely to benefit from the 
services generated by the GALILEO system is currently under way. 

1.2.4.  EGNOS will soon be operational 

The  development  and  finalisation  of  the  EGNOS  system  went  ahead  satisfactorily  during 
2003. The first experimental signal was transmitted on 6 June 2003 and, since that date, the 
setting-up  of  the  entire  system  has  been  gradually  completed.As  at  November  2003,  the 
following  were  in  place:two  of  the  four  main  monitoring  centres  envisaged,  viz.  Langen  in 
Germany and Torrejon in Spain; three of the six NLES9 transmitting stations envisaged, viz. 
Goonhilly,  Scanzano  and  Torrejon;  and  more  than  16  of  the  34  RIMS10  signal  receiving 
stations envisaged. 

A  number  of  tests  demonstrating  the  possibilities  offered  by  EGNOS  were  completed 
successively during 2003 in several European countries, notably in France and Switzerland, as 

8 
9 
10 

Advanced Research 
Navigation Land Earth Station 
Reference and Integrity Monitoring Stations 

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well as in Africa and Latin America. Other experiments are in progress or in preparation, e.g. 
in China, South Africa and in the Mediterranean countries. 

Following  the  Operational  Readiness  Review  due  in  April  2004,  the  services  offered  by 
EGNOS will become permanent. It will then be possible to embark on the system validation 
and  certification  procedures  in  certain  very  exacting  sectors  with  regard  to  security  and 
reliability, such as civil aviation and maritime transport. 

As regards the institutional and financial aspects, the Council, in its conclusions adopted on 
5 June 2003,  asked  to  place  the  EGNOS  programme  under  the  control  of  the  Joint 
Undertaking,  in  order  to  guarantee  the  integration  of  EGNOS  in  GALILEO.  In  the  same 
conclusions, the Council also asked for EGNOS to benefit from public funding from various 
sources  between  2004  and  2008  and  that  the  European  Community  would  continue  to 
participate in the funding of EGNOS. The European Space Agency and the Joint Undertaking 
are currently preparing the financing in collaboration with Eurocontrol and the national civil 
aviation authorities operating within the EOIG.11 

Lastly, it should be pointed out that, for air traffic control purposes, the Eleventh ICAO Air 
Navigation  Conference  held  in  Montreal  at  the  end  of  September  2003  came  out  largely  in 
favour  of  the  use  of  procedures  based  on  the  “augmentation”  systems,  the  European 
component  of  which  is  none  other  than  EGNOS.  Moreover,  the  ICAO  has  confirmed  that, 
ultimately,  satellite  radionavigation  should  become  the  single  tool  for  use  in  air  traffic 
management. 

1.2.5.  The European Radionavigation Plan 

Radionavigation  systems  are  a  crucial  safety  element  in  numerous  sectors.  Consequently,  it 
would appear necessary, as a result of the elaboration of a European Radionavigation Plan, to 
harmonise  the  information  available  on  existing  radionavigation  systems,  their  period  of 
validity  and  the  technical  transitions  envisaged,  as  well  as  their  characteristics  and  their 
redundancy  capacity  vis-à-vis  other  systems.  It  should  be  noted  that  the  two  countries  that 
have a satellite radionavigation system, i.e. Russia and the United States, already possess such 
a radionavigation plan. 

The  Commission  has  launched  a  study  which  should  provide  exhaustive  information  that  is 
essential for drawing up a European Plan. This study will contribute to the integration of the 
system  issued  from  the  GALILEO  programme  in  existing  navigation  systems,  notably 
terrestrial  systems.  It  will  permit  the  launching  and  harmonisation  of  the  technical 
certification  procedures  from  the  EGNOS  and  GALILEO  programmes  with  regard  to 
transport by  air, land and sea . It should be noted that the future European Radionavigation 
Plan  does  not  cover  just  the  Member  States  of  the  European  Union;  it  also  concerns  all 
neighbouring countries of the Union. 

1.3. 

Outcome of the World Radiocommunication Conference held in June 2003  

On  the  occasion  of  the  World  Radiocommunication  Conference  held  in  June  2003,  the 
European Community had two satellite radionavigation objectives designed to ensure that the 
future GALILEO system could generate all the services envisaged: on the one hand, to obtain 
confirmation of the spectrum of frequencies allocated in 2000 to satellite radionavigation as a 

11 

EGNOS Operation and Infrastructure Group 

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whole;  on  the  other,  to  ensure  that  within  this  frequency  spectrum,  distribution  among  the 
different  systems  should  not  prove  disadvantageous  to  the  European  system.  On  both  these 
points, the Community has good reason to welcome the results achieved. 

1.3.1.  Confirmation of frequencies allocated to satellite radionavigation  

The  principal  aim  was  to  ensure  that  the  GALILEO  system  and  the  other  satellite 
radionavigation  systems  can  coexist  alongside  the  systems  used  by  civil  aviation  without 
causing  unacceptable  mutual  interference.  Two  frequency  bands  were  involved.  For  one  of 
them,  the  discussions  resulted  in  a  solution  consisting  in  the  provision  of  guarantees  of 
reciprocal protection based on coordination, rather than through operating restrictions. In the 
case  of  the  other  band,  the  agreement  finally  reached  stipulates  that  all  satellite 
radionavigation systems must comply with maximum power emission limits. These solutions 
were approved both by the satellite radionavigation system operators and by the aeronautical 
community. 

The  Conference  confirmed  and  set  out  in  detail  the  conditions  governing  the  use  of  the 
frequency  spectrum  allocated  to  the  satellite  radionavigation  systems,  in  such  a  way  as  to 
guarantee  the  GALILEOoperating  conditions  while  at  the  same  time  protecting  other  major 
sectors  such  as  civil  aviation.  The  signal  specifications  worked  out  during  the  definition 
studies of the system were confirmed. 

1.3.2.  Establishment of an equitable coordination procedure 

It was of fundamental importance that access to the spectrum of frequencies allocated to the 
various satellite radionavigation systems should be equitable, should be based on the principle 
of interoperability and should provide for mutually agreed degrees of scrambling. 

The  Conference  debated  this  point  at  greater  length,  all  the  more  so  as  the  international 
landscape  is  evolving  from  a  situation  characterised  by  the  historical  monopoly  of  the 
American  GPS  system  vis-à-vis  an  environment  where  several  systems  will  coexist.  The 
position  constantly  championed  by  the  European  Community  in  favour  of  impartial 
multilateral  coordination  by  the  International  Telecommunication  Union  (the  so-called 
“Article  9”  approach)  was  adopted.  The  cohesion,  competence  and  determination  of  the 
European  delegations  proved  decisive  in  this  respect.  The  procedures  defined  by  the 
International Telecommunication Union will apply with effect from 1 January 2005. 

1.4. 

The  integration  of  the  new  Member  States  and  the  candidate  countries  is  well 
under way 

Allowing for the fact that the new Member States of the European Union will play a key role 
in the GALILEO programme, the European Commission saw a clear need to provide for their 
gradual  integration  in  the  GALILEO  and  EGNOS  programmes  through  concrete  actions 
starting with the conference entitled “GALILEO for an enlarged Europe”, which was held in 
Warsaw in May 2003. 

The presentations and declarations made by the representatives of the new Member States on 
the  development  of  satellite  radionavigation  have  demonstrated  just  how  much  they  are 
interested in using and, to a certain extent, developing the services linked to this technology, 
particularly in the sectors of transport, energy, geodesy and science in general. In this context, 
initiatives have been elaborated on an industrial scale so as to ensure the full participation of 
these  countries  in  the  GALILEO  programme  as  from  1  May  2004,  both  through  the 

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Framework Programme for research and development and the invitations to tender launched 
by the European Space Agency. 

2. 

INTERNATIONAL COOPERATION TAKES OFF 

As  the  Council  has  stressed  on  various  occasions,  international  cooperation  is  an  essential 
element  designed  to  ensure  that  maximum  benefits  are  derived  from  the  GALILEO 
programme.  Given  its  range  of  features,  the  European  satellite  radionavigation  system  will 
offer  a  hitherto  unequalled  international  public  service.  Third  countries  coming  forward  in 
ever-increasing  numbers  asking  to  be  associated  with  the  project  have  definitely  got  their 
priorities  right.  The  Agreement  with  China  was,  in  this  respect,  a  decisive  element,  while 
contacts with the major regions of the world are intensifying. At the same time, cooperation 
with  the  two  countries  already  in  possession  of  a  satellite  radionavigation  system  is  on  the 
increase; the conclusion of negotiations with the United States is one of the European Union’s 
priorities. 

2.1. 

The principles on which international cooperation rests  

The interest shown by third countries with regard  to the future  European system of  satellite 
radionavigation continues to grow. However, the reason underlying international cooperation 
largely  transcends  the  need  to  meet  the  demands  of  this  or  that  country  and,  in  fact,  is 
fundamental to ensuring interoperability with existing systems, in order to promote European 
industrial  and  political  know-how,  stimulate  the  provision  of  system  applications,  penetrate 
the markets of third countries and install components of the terrestrial segment in certain parts 
of the globe. The fact that more and more third countries are associated with the programme 
and hence share the European Union’s interests in promoting it, not least in the international 
bodies, has resulted in a reduction in the technical and political risks involved. The close links 
forged  with  future  users  worldwide  make  it  possible  to  define  with  the  greatest  degree  of 
precision  the  services  likely  to  comply  with  the  requirements.  Lastly,  international 
cooperation involves a strong political dimension, since it enables numerous third countries to 
be associated with the management of a strategic infrastructure. 

In  order  to  meet  the  demands  of  third  countries  and  derive  maximum  benefit  from  the 
advantages  of  international  cooperation,  the  Commission,  in  accordance  with  the  political 
guidelines laid down by the European Parliament and the Council, is pursuing two approaches 
simultaneously: the bilateral approach and the regional approach. 

The  bilateral  approach  relies  on  the  conclusion  of  Agreements  between  the  European 
Community  and  those  countries  which  have  special  skills  in  the  field  of  satellite 
radionavigation.  These  Agreements,  concluded  after  negotiations  conducted  on  the  basis  of 
the  Council’s  directives,  define  a  broad  framework  of  cooperation  combining  institutional, 
regulatory, industrial, technological and financial aspects. An initial Agreement was signed on 
30 October 2003 between the European Community and its Member states on the one hand, 
and the People’s Republic of China on the other hand. 

The regional approach, on the other hand, is directed at countries whose main interest in the 
GALILEO programme lies in the fact that they are future users of the system. More often than 
not, it draws on regional and multilateral cooperation structures which already exist. 

The  bilateral  and  regional  approaches  are  based  on  common  principles.  Thus,  the  actions 
carried out take full account of the requirements associated with the control and protection of 

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the system as well as the European Community’s commitments regarding export control and 
non-proliferation. The GALILEO Security Board, commonly referred to as GSB and made up 
of security experts, supports the Commission’s action in in drafting the texts discussed with 
third countries on these matters. Sensitive activities, such as those affecting the security of the 
system, remain outside the cooperation framework. Provision has been made, moreover, for 
the  conclusion  of  security  agreements  with  the  various  associated  countries  once  the 
appropriate European authority with competence in this field has been set up (cf point 3.2). 
The  agreements  concluded  with  third  countries  mainly  foresee  the  participation  by  these 
countries in technical and industrial activities through a participation to the Joint Undertaking. 
The  modalities  of  this  participation  are  then  decided  on  a  case  by  case  basis  in  close 
consultation  with  the  relevant  bodies  from  those  countries,  the  Joint  Undertaking  and  the 
European Space Agency. 

The  financial  participation  of  third  countries  associated  with  the  programme  represents  a 
preliminary to their involvement and will make it possible to complete the financing of future 
phases. Like the Community contribution, all financial participation by third countries will be 
managed by the Joint Undertaking, guarantor of the unique way in which the programme is 
managed.  To  this  end,  following  the  conclusion  of  an  Agreement  with  a  third  country,  the 
Joint Undertaking can start discussions in accordance with the procedure foreseen in article 5 
of the Council Regulation No 876/2002. 

2.2. 

An exemplary Agreement with China on bilateral cooperation 

Following the authorisation given to the Commission by the Council to start negotiations in 
March 2003, an initial cooperation agreement was signed with China on 30 October 2003 on 
the occasion of the summit between the European Union and this country. This, in itself, is an 
important  step,  in  that  the  Agreement  represents  a  model  for  the  rapid  association  of  other 
third countries. The areas of cooperation covered by the Agreement are legion, ranging from 
Chinese  support  for  the  regulatory  aspects  of  the  project,  notably  as  regards  certification, 
frequencies and intellectual property, to scientific and industrial action. At the financial level, 
China has indicated its readiness to contribute the sum of €200 million to the programme. 

The  forthcoming  stages  in  the  cooperation  process  will  consist  in  defining  simultaneously 
China’s place within the Joint Undertaking and its industrial and scientific role. On the first 
point,  the  Chinese’s  participation  in  the  Joint  Undertaking  will  comply  with  the  procedure 
provided  by  article  5  of  Regulation  876/2002.  The  Supervisory  Board  of  the  Joint 
Undertaking will be involved in this initiative with a view to preparing a decision to be taken 
by the Council. On the second point, steps should be taken to determine the actual conditions 
governing  the  participation  of  Chinese  experts  and  companies  in  the  development  and 
deployment phase work, using the Chinese’s financial contribution. Discussions, in which the 
European Space Agency is closely involved, are being conducted on this subject by the Joint 
Undertaking  with  the  Chinese  partners.  The  ultimate  aim  of  these  discussions  is  to  identify 
those  elements  in  the  programme  that  are  likely  to  be  the  subject  of  such  involvement. 
Choices  will  be  made  on  the  basis  of  the  special  skills  which  associated  third  country 
participants may provide, without in any way weakening the industrial policy character of the 
programme for European industry. 

Specific cooperation initiatives have already been embarked on. Thus, a joint training centre 
(China-Europe GNSS Training and Technical Cooperation Centre) was inaugurated in Beijing 
on  19  September  2003  to  promote  joint  activities  involving  training,  experiments, 
applications,  industrial  cooperation  and  marketing  affecting  the  future  European  system.  In 

9 

 
 
  
 
addition, a series of tests based on EGNOS stations and pilot applications in the priority areas 
of rail, inland waterway and maritime transport is due to be launched in China. 

The  Agreement  with  China  has  triggered  cooperation  requests  from  other  third  countries 
interested  in  being  involved  in  the  development  of  the  GALILEO  system.  Accordingly,  the 
Council  has  formally  authorised  the  Commission  to  enter  into  negotiations  with  a  view  to 
preparing a cooperation agreement with India and Israel. The negotiating directives for these 
two countries were  drawn  up  on the  same basis as those  adopted  for  China in March 2003. 
These two new mandates follow on from exploratory approaches made by the Commission at 
the request of the interested countries. Similar steps are being taken involving other countries, 
notably  South  Korea,  Brazil,  Japan,  Canada,  Australia,  Mexico  and  Chile.  According  to  the 
same  schedule  as  was  used  in  the  case  of  China,  India  and  Israel  –  assuming  that  these 
contacts result in a formal application for association – , the Commission will first notify the 
Council and then submit recommendations with a view to obtain the authorisation to conduct 
the appropriate negotiations. 

Furthermore,  Switzerland  and  Norway,  which  are  already  associated  with  the  GALILEO 
programme  through  the  European  Space  Agency,  informed  the  Commission  in  December 
2003  of  their  interest  in  starting  discussions  on  becoming  more  closely  associated  with  the 
programme, not least through involvement in the Joint Undertaking. 

2.3. 

Closer cooperation with the major regions of the world  

With a view to deriving maximum advantage from the GALILEO and EGNOS programmes, 
the  priority  aim  of  regional  cooperation  is  to  establish  a  dialogue  with  future  users  in  the 
countries  concerned,  based  mainly  on  experimental  and  training  campaigns  conducted  in 
different regions of the world. 

2.3.1.  The Mediterranean region 

One of the projects envisaged under the MEDA Programme covers satellite radionavigation 
training  and  experimental  actions  in  the  Mediterranean  Basin.  These  actions  should  have  a 
budget of nearly €5 million and should begin in 2004. In February 2003, during the project 
preparatory  phase,  the  Commission  held  the  first  Euro-Mediterranean  seminar  on  satellite 
radionavigation.  The  main  aim  of  this  seminar  was  to  promote  awareness  among  decision-
makers,  service  providers  and  local  industrialists  regarding  the  stakes  represented  by  the 
EGNOS and GALILEO systems for the Mediterranean region. A regional cooperation office 
is also due to be set up with the aim of promoting training and industrial cooperation actions 
in the region. Egypt will host this centre. 

2.3.2.  Latin America 

Since 2001, the European Union has been establishing links with Latin America in the field of 
satellite radionavigation. Through a programme financed under the Community budget, it has 
been  possible  to  bring  together  European  industrialists  and  local  authorities  responsible  for 
transport  and  to  carry  out  feasibility  tests  based  on  the  EGNOS  experimental  signal.  The 
positive results achieved through these tests have confirmed the interest shown by countries in 
the region in becoming associated with the GALILEO programme.  

Taking into account the region’s importance and potential, a new action is to be conducted by 
the  Joint  Undertaking,  mainly  with  a  view  to  establishing  a  network  of  training  centres, 

10 

 
 
  
 
supporting  the  regional  technical  cooperation  plan  devised  by  the  ICAO,  organising 
experiments in various sectors of activity and encouraging industrial cooperation. 

2.3.3.  Africa 

The  establishment  of  an  international  satellite  radionavigation  system  is  one  of  the  explicit 
cooperation  objectives  of  the  transport  policy  strategy  under  the  partnership  agreement 
between the European Community and the ACP countries signed in Cotonou in June 200012. 
In Africa, satellite radionavigation provides a means for developing the civil aviation sector, 
thereby benefiting the African economies, notably commerce, tourism and the management of 
natural  resources.  It  also  offers  an  opportunity  to  improve  security  in  the  region  and  helps 
reduce the amount of investment required for the creation of transport infrastructures. 

The  European  Union  and  the  African  civil  aviation  authorities  have  enjoyed  a  productive 
relationship  over  the  last  few  years.  The  experiments  carried  out  from  a  terrestrial 
infrastructure and aboard aircraft in the Dakar region confirm Europe’s commitment to extend 
to the whole world the use of satellite radionavigation systems. Various studies financed by 
the  European  Community  have  looked  at  the  possibility  of  extending  to  Africa  access  to 
satellite radionavigation services. The African civil aviation authorities (AFCAC, ASECNA, 
SADC), with the ICAO’s support, have now set themselves the aim of putting this technology 
to use. 

The  work  carried  out  in  this  region  of  the  world  will  be  speeded  up  this  year  under  the 
guidance of the Joint Undertaking. The use of the systems EGNOS and GALILEO will affect 
not  just  the  civil  aviation  sector  but  many  other  sectors  as  well,  and  will  involve  the 
development of satellite radionavigation services in areas as diverse as transport, agriculture, 
fisheries, civil engineering, the environment, etc. 

2.4. 

Negotiations with countries (United States and Russia) already in possession of a 
satellite radionavigation system 

As  regards  both  of  the  third  countries  which  already  have  their  own  international  satellite 
radionavigation system,  the  negotiations are not only pursuing the same objectives as is the 
case  with  the  other  third  countries,  but  they  are  also  seeking  to  ensure  the  technical 
compatibility and interoperability of their system with the GALILEO system. 

2.4.1.  Russia 

During the summit between the European Union and Russia held in May 2003, the European 
Union once more expressed its wish to continue the negotiations begun with Russia in 2000 
and to conclude a cooperation agreement with that country. Up to now, the discussions have 
concentrated on the technical and industrial aspects.  

Steps  must  now  be  taken  to  give  these  discussions  a  more  political  dimension  to  take  into 
account the conditions of use of the international satellite radionavigation systems, the various 
ways of enabling the GALILEO system and GLONASS to coexist and the steps being taken 

12 

Point  2.2  of  the  Compendium  on  cooperation  strategies  devoted  to  the  development  of  transport  and 
drawn up in accordance with Article 20.3 of the Cotonou Agreement is worded as follows: “At regional 
level,  particular  attention  will  be  paid  to  the  provision  of  support  for  improving  the  reliability  and 
safety  of  maritime  and  air  transport,  as  well  as  contributing  to  a  global  navigation  satellite  system 
interoperable with the European Geostationary Navigation Overlay Service.”  

11 

 
 
  
 
                                                 
to  modernise  GLONASS.  In  order  to  facilitate  the  resumption  of  the  negotiations,  the 
Commission has provided the Russian authorities with a draft agreement. 

Along the same lines as the dialogue on energy, cooperation in this key area would actively 
promote economic and political integration between the European Union and Russia. 

2.4.2.  USA 

Concluding the negotiations with the USA has been the priority for the European Union since 
discussions  began,  four  years  ago,  on  how  to  operate  the  European  GALILEO  system  and 
America’s  GPS  system  side  by  side.  Initially,  the  USA  disputed  the  merits  of  the  Galileo 
programme  itself.  Over  the  last  18  months,  however,  with  the  aid  of  the  technical  working 
party set up on compatibility and interoperability, considerable progress has been made on all 
the  items  under  discussion.  The  biggest  obstacles  to  an  agreement  between  the  two  parties 
have  now  been  removed.  The  USA  recognises  the  importance  of  the  European  system  for 
satellite radionavigation users. 

First, with regard to the overlay of signals on the same frequency band, for military security 
reasons  the  USA  was  against  assigning  the  GALILEO  system  a  signal  modulation  which 
would partly overlap with that of the GPS's future military signal, “code M”. The European 
experts  in  the  Signal  Task  Force  were  able  to  show  their  American  colleagues  that  there 
would be no harmful interference between the signals of the European system and those of the 
GPS system and that the two systems are technically perfectly compatible, including in terms 
of  time  references  and  geodesy.  Another  major  breakthrough  on  the  road  to  an  overall 
agreement  came  at  two,  partly  classified,  meetings,  the  first  held  in  London  on  4  and  5 
September 2003, the second in The Hague on 19 November 2003, when a solution was found 
for the governmental service signal. 

Two  further  questions  remain  to  be  solved:  the  coexistence  of  the  open  signal  of  the 
GALILEO system and the GPS's military signal in the event of a crisis, and the prospects for 
further improving the signals of the European system. 

On  the  first  point,  it  is  important  to  highlight  the  fact  that  some  applications  of  the  open 
service require great  precision, as for  the interurban applications, emergency calls  using the 
European 112 number or the guidance assistance for the blind. This implies choosing a very 
high-performance  signal,  guarantee  for  the  commercial  success  of  the  European  system, 
which will have to be secured in the Agreement. However, the military authorities need to be 
able  to  jam  the  open  signal  of  the  GALILEO  system  locally  in  a  conflict  zone,  while 
maintaining  the  integrity  of  the  GPS's  military  signal  in  the  same  zone.  During  the  last 
discussions held in Washington on 29 and 30 January 2004, both parties have recognised the 
interest  to  exploit  the  same  signal  to  develop  fully  interoperable  receivers.  It  now  seems 
possible to reach a compromise based on the choice of identical signals, with the possibility of 
further improvement. 

On  the  second  question  precisely  concerning  the  possibility  to  improve  the  signals,  the 
comprehensive  agreement  emerging  from  the  discussions  must  provide  an  effective, 
transparent,  two-way  procedure  for  agreeing  on  how  to  optimise  the  performance  of  the 
European and American systems, taking account of US national security concerns. However, 
this should not include a right of veto by either partner over the other. 

On  interoperability,  the  objective  of  the  European  Community  is  to  obtain  maximum 
interoperability between the GPS and GALILEO systems, to the greatest benefit of users. The 

12 

 
 
  
 
satellite ground control components of the two systems will, of course, remain separate and 
independent. US and European experts discussed a variety of technical issues which have now 
been  resolved,  including  time  references:  the  signals  from  each  system  will  include  a 
parameter  allowing  perfect  synchronisation  of  the  signals.  Thanks  to  this  fundamental 
achievement owners of a single receiver will be able to make use, fully transparently, of both 
systems combined. 

Finally,  with  regard  to  trade,  the  European  Community  is  seeking  to  create  a  non-
discriminatory  commercial  environment  for  satellite  radionavigation  for  both  the  American 
GPS system and the European GALILEO system alike. Considerable progress has been made 
towards an agreement. The USA now recognises that the rules of international trade apply to 
satellite radionavigation. In turn, the European Community has agreed to specific provisions 
to close any gaps in the multilateral rules. 

The  progress  made  during  the  latest  negotiations  is  a  hopeful  sign  that  a  comprehensive 
agreement will be reached very soon.  

3. 

MOVING AHEAD TO THE DEPLOYMENT AND OPERATION PHASES 

With  the  Joint  Undertaking  now  in  operation,  technical  work  continuing,  international 
cooperation in full swing and an agreement about to be concluded with the USA, the next step 
is actively to prepare for the deployment and operation phases for Galileo, which will start in 
2006 and 2008 respectively. 

3.1. 

Call for tenders for the concession for the system 

The initial results of the procedure for awarding the concession for the system are extremely 
encouraging.  At  the  same  time  a  clearer  picture  is  emerging  of  ways  of  financing  the 
deployment and operation phases. 

3.1.1.  Concession procedure 

The  procedure  for  awarding  the  concession  for  the  deployment  and  operation  phases  of  the 
Galileo programme is managed by the Joint Undertaking. It started in earnest on 17 October 
2003  with  the  publication  of  a  concession  notice  in  the  Official  Journal13.  However,  even 
before  the  Joint  Undertaking  started  operations,  to  avoid  delaying  the  programme  the 
Commission had taken two preliminary measures. 

First, on 22 February 2003 the Commission published a call for expressions of interest for the 
concession of the implementation and the management of the GALILEO system14. Some 80 
undertakings  replied.  Then  on  18  March  2003  the  Commission  organised  a  briefing  session 
for  undertakings  which  wished  to  take  part  in  the  programme.  Around  500  representatives 
from  industry  attended  this  event  to  hear  about  development  of  the  programme,  the  stages 
leading  to  selection  of  the  future  concession-holder,  and  the  many  opportunities  which 
satellite radionavigation can offer. 

The preselection phase was launched on 17 October 2003 and is divided into two stages: first 
short listing, then competitive negotiation. 

13 
14 

OJ S 200, 17 October 2003. 
OJ C 43, 22 February 2003, page 12. 

13 

 
 
  
 
                                                 
The first was conducted by the Joint Undertaking, which examined the four tenders received 
by the deadline and short listed the candidates for the second stage. 

The preselection criteria were: 

– 

– 

the ability of the candidates to fund both the deployment of the infrastructure 
and  the  management  of  the  infrastructure  during  the  operation  phase;  in 
particular, each candidate was required to submit a business plan covering the 
whole period of the concession; 

the ability of the candidates to develop and promote the use of the GALILEO 
system  at  a  global  level,  in  particular  based  on  their  experience  and 
international alliances; 

– 

the account taken of the interests of the public authorities. 

The deadline  set for  receipt of application packs was 5 December  2003  and the packs were 
opened  at  the  Joint  Undertaking  headquarters  on  9  December  2003.  The  four  tenders 
registered were eligible. 

Each tender was submitted by a consortium consisting of a limited number of lead partners, 
backed  up  by  a  cluster  of  companies  from  the  most  diverse  fields,  particularly  financial 
institutions or undertakings working on various applications of satellite radionavigation. 

None of the four consortia bidding doubted the potential of the European system of satellite 
radionavigation  to  generate  substantial  commercial  revenue  and  each  was  willing  to  fund  a 
considerable  proportion  of  its  contribution  from  its  own  assets.  The  commercial  and 
governmental  services  offered  by  Galileo  together  with  the  attached  intellectual  property 
rights are considered particularly significant sources of revenue. Beyond that, the applicants 
took  account  of  the  worldwide  dimension  of  the  project  and  of  its  implications  in  various 
fields  of  economic  activity.  Some  of  the  tenders  will  even  enlist  partners  from  outside  the 
European Union. 

The results of the call for tenders must be rated as extremely encouraging. They vindicate the 
choice of a public/private partnership, while the fact that the private sector is making a heavy 
financial commitment without hesitation confirms that big opportunities await on the market. 
The wide range of applicants from different sectors of the economy in response to the call for 
tenders is further evidence of the future benefits which the GALILEO system will bring for 
society as a whole. 

During  the  second  phase,  known  as  “competitive  negotiation”,  it  is  foreseen  that  the  Joint 
Undertaking  will  enter  into  negotiations  with  the  short  listed  candidates  with  a  view  to 
awarding the concession. Only the short listed candidates will come into consideration in this 
phase, in which they will have to comply with set specifications. At the end of the competitive 
negotiation phase the Joint Undertaking will present a proposal on who should be awarded the 
concession. 

According to the call for concession published in the Official Journal, the concession will go 
to  the  short  listed  candidate  which,  at  the  end  of  the  day,  offers  the  best  value  for  money, 
based mainly on: 

– 

the amount of public aid requested. In particular, account will be taken of the 
credibility and relevance of the proposals made by the candidate with a view to 

14 

 
 
  
 
maximising  the  commercial  income  generated  by  the  use  of  the  GALILEO 
system; 

– 

the  quality  of  the  tender  submitted  by  the  candidate  with  regard  to  the 
requirements to establish and manage the space and ground facilities required 
for  the  GALILEO  system  to  operate  in  conformity  with  the  public  service 
requirements imposed, particularly in terms of service guarantee and security. 
In  particular,  the  bid  will  have  to  meet  the  specific  requirements  for 
management of a worldwide service. 

3.1.2.  Financing of the deployment and operating phases 

The results of the call for tenders for the award of the concession show that the private sector 
is  prepared  to  make  a  substantial  commitment  to  the  Galileo  programme.  Each  of  the  four 
tenders received refers to the Council's recommendation that Community funding should not 
exceed one third of the financing for the deployment phase. It is therefore possible to outline 
the financing plan for these two phases. Five different resources, identified and described by 
the consortia bidding for the concession, should contribute to the financing. The establishment 
of a sixth resource could also be considered. 

Firstly, the future concessionaire would receive payment for the sale of the various services 
generated by the GALILEO system. 

Secondly,  the  future  concessionaire  also  stands  to  gain  from  the  licences  and  intellectual 
property rights for system components. 

Thirdly,  the  European  Community,  which  together  with  the  European  Space  Agency  is 
providing  all  of  the  financing  for  the  development  phase,  will  continue  to  participate  in  the 
financing of the programme beyond the current financial perspective, which expires in 2006. 
The  Council  made  a  specific  commitment  to  this  effect  in  the  conclusions  it  adopted  on  26 
March 2002. The cost of the deployment phase is put at €2.1 billion. The exact share which 
the public sector is asked to provide will naturally depend on the amount which the private 
sector decides to contribute. The Commission has already included the GALILEO programme 
amongst the programme of projects identified in the European initiative for growth15 (Quick-
start  Programme),  which  has  been  endorsed  by  the  Council.  It  is  on  this  basis  that  the 
Commission  is  preparing  the  future  budget  allocation  for  the  Galileo  programme  under  the 
new financial perspective. 

Fourthly,  the  European  Investment  Bank  has  said  it  is  willing  to  grant  loans.  In  this 
connection, the tenders submitted by the bidding consortia all stress the importance of having 
long-term  loans  with  a  grace  period  which  will  allow  repayment  to  start  when  the  system 
begins to generate significant commercial activity. 

Fifthly, some third countries are prepared to contribute financially to the programme (cf. point 
2. above). The sums concerned will amount to several hundred million euros, some of which 
may be invested in the deployment and operating phases. 

Sixthly, if it proves necessary to find additional financing, a levy on satellite radionavigation 
signal  receivers  could  be  introduced  at  the  European  level  to  finance  the  deployment  and 
operating phases. This would constitute an own resource for the future Supervisory Authority, 

15 

COM(2003) 690 final of 11 November 2003. 

15 

 
 
  
 
                                                 
which could transfer a portion of the proceeds to the concessionaire so as to reduce the need 
for  other  public  funds.  The  proposal  for  a  regulation establishing the  Supervisory Authority 
(cf. point 3.2.1. below) makes provision for this option. Its implementation will depend on the 
business  and  market  developments  in  GNSS  receivers  and  associated  services.  Before  the 
Commission  presents  such  a  proposal,  a  comprehensive  analysis  taking  into  account  all 
economic and market effects on the affected sectors will be performed. 

The  exact  amount  to  be  contributed  by  the  future  concessionaire  will  be  discussed  at  the 
competitive  negotiation  phase  and  will  only  be  known  after  completion  of  the  selection 
procedure, some time during 2004. In this respect, the diversity of the services generated by 
the  GALILEO  system  is  without  any  doubt  a  factor  which  will  help  to  maximise  the 
concessionaire’s future revenue and, hence, its financial contribution. 

3.1.3. 

Services generated by the GALILEO system 

The  definition  of  the  services  and  the  frequency  plan  of  the  future  European  system  of 
satellite radionavigation were addressed at length in the communication from the Commission 
to Parliament and the Council adopted on 24 September 2002. Point 3 of that communication 
and Annex 1 thereto, in which the services and associated frequencies are specified, serve as 
reference documents. 

The system has been designed to be flexible, as it was defined in the early years of the new 
millennium to serve for a period of at least twenty five years, starting from 2008. Since it is 
impossible to foresee all the changes that may take place during such a long period of time, it 
is  essential,  owing  to  technical  advances  and  changes  in  markets,  that  the  signal  generators 
placed  on  board  the  satellites  are  totally  flexible,  and  this  can  be  achieved  by  providing 
capacity for downloading signal modulations rather than using generators which do not permit 
subsequent modifications to be made. Possible modifications to the signal will not affect the 
performance  of  receivers  already  in  service,  even  though  more  efficient  receivers  may  be 
developed.  Flexibility  guarantees  the  level  of  performance  which  users  of  the  GALILEO 
system are entitled to expect. It goes without saying that such technical flexibility will be only 
be  applied  in  conformity  with  the  agreements  which  have  been  concluded  with  partners,  in 
particular the United States, as described in point 2.4.2. 

At its meeting of 5-6 December 2002, the Transport Council adopted conclusions according 
to  which  the  statement  of  work  for  the  calls  for  tender  to  be  launched  for  the  Galileo 
programme  included  the  five  services  specified  in  the  Commission  communication  of  24 
September  2002.  Those  bidding  for  the  concession have  fully  understood  and  endorsed  this 
latest  World 
approach,  which  has  now  been  borne  out  by 
Radiocommunication  Conference  (cf.  point  1.3.  above),  the  removal  of  the  last  remaining 
obstacle concerning the governmental signal and the good progress made with regard to the 
search and rescue service. 

the  results  of 

the 

3.1.3.1. Removal of the last obstacle concerning the governmental signal 

As  indicated  in  point  2  above,  an  agreement  has  been  reached  with  the  United  States 
concerning the coexistence of the frequencies used by the governmental service signals of the 
GALILEO  system  and  those  used  by  the  GPS  system  M  code  signals.  This  agreement 
removes  any  political  obstacle  to  the  existence  of  a  governmental  service  with  encrypted 
signals that are especially resistant to interference. 

16 

 
 
  
 
Moreover,  studies  have  shown  the  impact  of  the  cost  of  the  governmental  service  on  the 
design and equipment of the GALILEO system as a whole is almost insignificant as far as the 
space segment is concerned. The only additional costs generated by the governmental service 
are  those  connected  with  its  operational  management.  However,  they  will  be  borne  only  by 
Member  States  which  wish  to  use  this  service,  as  its  use  will  be  optional  and  left  to  the 
discretion of each Member State within the framework laid down by the future Supervisory 
Authority  (cf.  point  3.2.1.  below).  Any  charges  which  might  be  levied  for  the  use  of  the 
governmental service will be determined by the concession contract. 

It should be pointed out that, in the tenders submitted, those bidding for the concession for the 
system  have  confirmed  that  the  provision  of  a  governmental  service  will  account  for  a 
substantial  portion  of  the  revenue  of  the  future  operator,  in  particular  by  virtue  of  the  user 
licences.  Moreover,  the  award  of  the  concession  for  infrastructure  will  make  it  possible  to 
obtain the best possible balance between management costs for the governmental service and 
the revenue it yields. 

3.1.3.2.  Good progress with regard to the search and rescue service 

Work  on  defining  the  search  and  rescue  service  has  been  accompanied  by  technical 
discussions  within  Cospas-Sarsat.  This  international  organisation,  whose  four  founder 
members  are  the  United  States,  the  Russian  Federation,  France  and  Canada,  offers  an 
operational global search and rescue service. As the European Union has proposed in the case 
of the GALILEO system, the United States and Russia have each announced that they intend 
to  make  their  GPS  and  GLONASS  satellite  radionavigation  systems  available  to  Cospas-
Sarsat in order to improve the effectiveness of the search and rescue service. 

Whilst  it  is  now  accepted  that  the  development  and  enhancement  of  the  search  and  rescue 
service  offered  by  Cospas-Sarsat requires  the  use  of  satellite  radionavigation,  efforts  should 
be made to ensure the compatibility of the technical specifications adopted for this purpose by 
the Galileo, GPS and GLONASS systems. To this end, a technical cooperation agreement to 
be  concluded  in  2004  will  define  the  characteristics  of  the  enhanced  service,  the  expected 
performances and the sharing of responsibilities between the various partners. 

In  the  longer  term,  it  will  be  necessary  to  conclude  another  agreement,  between  the 
Supervisory  Authority  and  the  founding  members  of  the  Cospas-Sarsat  system,  on  the 
definition of the service generated by the GALILEO system and the specific conditions for its 
use. 

Feasibility studies are currently being carried out to include in the GALILEO programme the 
Inmarsat system of research and rescue. 

3.2. 

Framework structure for the system 

On 31 July 2003, the Commission forwarded to the Council and the European Parliament a 
proposal  for  a  regulation  on  the  establishment  of  structures  for  the  management  of  the 
European  satellite  radionavigation  programme16.  The  proposal  is  currently  being  considered 
by  the  Council  and  the  European  Parliament.  It  is  proposed  that  two  structures  be  set  up, 
namely a Supervisory Authority and a Centre for Security and Safety. 

16 

COM(2003) 471 final 

17 

 
 
  
 
                                                 
3.2.1. 

Supervisory Authority 

The  Supervisory  Authority’s  role  is  to  manage  public  interests  relating  to  the  European 
satellite radionavigation programme and, in particular, to act as the licensing authority for the 
system. It will sign the concession contract with the concessionaire and will ensure that it is 
complied with. 

The structure is modelled on that of a regulatory agency and external to the Commission. It 
must  beset  up  as  soon  as  possible  because  its  establishment  completes  the  institutional 
framework  for  European  satellite  radionavigation.  It  signals  the  Union’s  political  will  to 
implement the Galileo programme successfully and make it definitive. 

Moreover,  it  is  essential  that  the  Supervisory  Authority  be  set  up  at  the  same  time  as  the 
Centre  for  Security  and  Safety  (cf.  point  3.2.2.  below).  The  Supervisory  Authority  and  the 
Centre for Security and Safety will indeed be closely linked to the definition of the security 
procedures  that  apply:  to  the  system  for  instance,  consultation  procedures,  procedures  for 
modifying  or  interrupting  signals,  or  procedures  for  monitoring  users  of  the  governmental 
service, who will be designated by each Member State according to its needs. 

There  is  also  an  urgent  need  to  establish  the  body  which  will  be  the  depositary  of  the 
frequencies  necessary  to  ensure  the  operation  of  the  system  and  will  coordinate  Member 
States’ actions in this connection. 

It is likewise essential to start up, without delay, the procedures for the certification and type-
approval  of  the  system.  This  is  one  of  the  key  factors  as  regards  the  rapid  deployment  of 
services  generated  by  the  GALILEO  system  in  sectors  such  as  civil  aviation,  maritime 
transport, the railways and construction. 

Lastly,  as  the  Supervisory  Authority  is  the  licensing  authority  vis-à-vis  the  future 
concessionaire, it must be in place in order to sign the concession contract, and the contract 
could be signed as early as the end of 2004. 

3.2.2.  Centre for Security and Safety 

The  GALILEO  system  is  a  sensitive  infrastructure  in  terms  of  security  and  safety.  It  is 
therefore  important  to  protect  its  operation  against  attacks,  malicious  or  otherwise,  and  to 
prevent its use for purposes which run counter to the interests of the European Union and its 
Member States. 

Since the start of work on the GALILEO programme, matters connected with the security of 
the  system  were  the  subject  of  detailed  studies  by  two  bodies,  namely  the  GSSB  (Galileo 
System  Security  Board),  informal  group  of  experts  whose  work  was  coordinated  by  the 
European  Commission,  and  the  GSAB  (Galileo  Security  Advisory  Board),  set  up  by  the 
European Space Agency. The work done by these two expert groups has proved very useful. 
It has made it possible to identify the main areas where specific action is needed. 

The  GSSB  and  the  GSAB  were  in  practice  replaced  by  the  Security  Board  (“GALILEO 
Security  Board”  or  “GSB”),  set  up  by  article  7  of  the  Regulation  N°  876/2002  to  deal  with 
security  matters  regarding  the  system  The  GSB  will  have  a  short  existence,  as  its  lifespan 
coincides with that of the Joint Undertaking and should therefore end with the development 
phase, in 2006. 

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At present, the GSB performs some very useful work, evaluating  the  needs and drawing up 
rules  on  reliability  to  be  applied  at  the  development  phase  and  for  the  system  validation 
procedures. It has also played a part in shaping the future management structures, in particular 
the Centre for Security and Safety, the establishment of which is the subject of a Commission 
proposal.  The  work  done  by  the  GSB  has  demonstrated  the  need  for  a  permanent  and 
operational decision-making structure whose principal role is to act as the interface between 
the  public  authorities  and  the  concessionaire  in  the  event  of  a  crisis,  and  which  could  even 
take measures involving the scrambling of the service’s signals.  

It  is  foreseen  that  the  Centre  for  Security  and  Safety  will  be  placed  under  the  direct 
responsibility of the General Secretary of the Council/High Representative for the Common 
Security and Foreign Policy. 

CONCLUSIONS 

Since  the  last  communication  on  the  progress  of  the  GALILEO  programme,  the  advances 
made  both  in  terms  of  the  development  of  the  system  and  its  applications  and  in  terms  of 
international cooperation have been considerable. The programme is evolving as planned, and 
its  international  dimension  is  asserting  itself  more  and  more  by  the  day,  e.g.  through  the 
forthcoming conclusion of an Agreement with the United States. Its development constitutes a 
key element in the strategy of the European Union in the field of space, as presented by the 
Commission in its White Paper on the European Space Policy17. 

Exactly  how  much  of  the  funding  the  private  sector  will  declare  itself  ready  to  take  on 
represents,  in  short,  the  only  element  of  uncertainty  remaining,  even  though  the  four  offers 
submitted under the procedure for selecting the future concession holder actually provide for 
the substantial involvement of the undertakings concerned. With a view to obtaining a definite 
commitment  from  the  private  sector  to  finance  two  thirds  of  the  deployment  and  operating 
phases,  as  recommended  by  the  Council,  it  would  be  desirable  if  the  latter  could  make  an 
irrevocable  commitment  of  its  own  in  favour of the programme. The determining factors in 
this respect would appear to be the promotion of the system through the creation of supportive 
environments, as well as the adoption of a definitive political decision to go ahead with the 
GALILEO programme until the system enters into service in 2008. 

Against this background, it is essential that the legislative procedure regarding the rules on the 
future  structures  for  managing  the  programme  be  achieved  without  delay,  and  that  the 
European  Parliament  and  the  Council  confirm  the  guidelines  which  they  have  previously 
issued  –  particularly  with  regard  to  the  services  which  will  be  generated  by  the  GALILEO 
system, so as to enable the European Space Agency to draw up once and for all the technical 
options adopted to date and to enable the Joint Undertaking to conduct negotiations aimed at 
selecting  the  system  operator  and  the  Supervisory  Authority  to  conclude  the  concession 
contract. 

17 

COM(2003)673 final 

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