Commission staff working document accompanying the communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - "Global Monitoring for Environment and Security (GMES):  we Care for a safer planet" - Impact assessment {COM(2008) 748 final} {SEC(2008) 2809}
Date: 2008-11-12
Institutions: European Commission
Subjects: EU policy, European Environment Agency, environmental policy, environmental protection, observation, space research

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 12.11.2008 
SEC(2008) 2808 

COMMISSION STAFF WORKING DOCUMENT 

accompanying the 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

"Global Monitoring for Environment and Security (GMES): 
 we Care for a safer planet" 

IMPACT ASSESSMENT 

{COM(2008) 748 final} 
{SEC(2008) 2809} 

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IMPACT ASSESSMENT 

EXECUTIVE SUMMARY 

This  Impact  Assessment  has  been  prepared  by  the  Commission  services  to  support  the 
Communication entitled "Global Monitoring for Environment and Security (GMES): we Care 
for a safer Planet."      

Substantial  R&D  effort  has  been  invested  on  Earth  observation  by  the  EU,  the  European 
Space  Agency  (ESA)  and  their  respective  Member States  to  develop  infrastructure  and  pre-
operational services. It is now time to guarantee their sustainability, to bring together actors 
from different institutional nature, to ensure proper representation of the EU Member States 
and to associate other countries involved.  

To achieve this  goal,  the GMES initiative  should  be implemented  operationally  through the 
establishment  of  an  EU-led  programme,  GMES.  The  objective  of  GMES  is  to  provide 
services allowing access to accurate environmental and security data and information, tailored 
to the needs of a wide range of users.   

An  extensive  stakeholder  consultation,  which  started  with  the  2005  Communication  "From 
concept to reality", has indicated that the following major problems are hindering the progress 
towards the realisation of the political and operational goals of GMES: 

• 

• 

• 

despite  the  user-driven  character  of  GMES  and  the  establishment  of  expert  groups 
(known  as  service  implementation  groups),  there  is  currently  no  formal  process  to 
involve the users in the definition of the scope and architecture of the services;  

equally,  there  is  no  process  to  consolidate  the  contributions  of  the  various  partners  in 
the development of GMES, which could result in a duplication of efforts in Europe. In 
this  context,  it  should  be  remembered  that  Member  States  and  intergovernmental 
organisations,  in  particular  ESA,  have  been  investing  significant  sums  in  earth 
monitoring  activities.  Nevertheless,  a  common  approach  is  still  missing  among  co-
existing  frameworks  at  EC,  intergovernmental  and  national  level  which  all  have 
separate decision and financing mechanisms;  

GMES  is  currently  a  set  of  research  projects  financed  by  the  EU,  ESA  and  Member 
States budgets. These projects aim at developing services and infrastructure, but cannot 
ensure a continuous and sustainable flow of information in an operational environment.  

This  baseline  would  undermine  users'  and  industrial  confidence  in  GMES.  GMES  would 
continue in the form of research projects, without an overarching governance framework for 
the coordination of the contributions from different GMES partners.    

The main objectives of the 2008 Communication are therefore to 

• 

• 

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make proposals for the overall programmatic approach and the governance of GMES as 
a whole and of its service and infrastructure components; and 

indicate the willingness of the Commission to propose a Basic Act establishing the EU 
GMES programme, without prejudging future financial decisions. 

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This two step approach, consisting of a Communication published in 2008 and a proposal for 
a basic legal act published in 2009, is considered of paramount importance for the success of 
GMES  for  strategic  reasons,  as  it  is  essential  to  use  the  current  momentum  created  by  the 
French presidency to convey the political messages contained in the Communication already 
in 2008, with a view towards a providing the (political) grounds for a comprehensive legal act 
for the initiative in 2009. Further, the Communication will constitute a decisive input for ESA 
Ministers that will have to make their decision concerning the continuation of GMES space 
infrastructure development in November 2008. 

The specific objectives of the Communication are to: 

(1) 

(2) 

(3) 

(4) 

define  a  transparent  and  sustainable  governance  framework  that  contains  a  clear 
division  of  the  roles  of  the  partners  in  the  GMES  partnership,  based  on  the  principle 
that GMES should use to the largest extent possible existing capacities; 

guarantee  user  uptake,  in  particular  through  constant  involvement  of  users  so  that 
GMES remains user driven; 

reassure  stakeholders  about  the  EU  commitment  to  GMES  in  the  sensitive  phase  of 
demonstration which precedes the move to operation;  

outline  how  the  governance  and  financing  framework  can  be  implemented  in  a 
reasonable timeframe. 

In  addition  to  the  baseline  described  above,  the  Impact  Assessment  defines  the  following 
options concerning the sustainability of financing (S) of service provision and contribution to 
infrastructure development and operations beyond research: 

• 

• 

• 

No action, S0-option: The EU continues to limit its financial contribution to GMES to 
research funds. 

Option S1: same as the previous option until 2013, but a programme is proposed in the 
context  of  the  preparation  of  the  next  financial  framework.  A  gap  is  left  between  the 
preparatory action (2008-2010) and 2014; 

Option S2: a Community programme is proposed in due time to bridge the gap between 
2011 and 2014. 

Concerning the roles and responsibilities of different actors (governance scheme- G), policy 
options at hand are: 

• 

• 

No  action  G0  option:  No  specific  governance  structure  is  maintained  within  the 
Commission in addition to the structures for the management of research funds. 

Option  G1:  The  Commission  takes  strong  political  and  managerial  control  and  is  in 
charge  of  the  management  of  the  GMES  programme,  a  formal  process  for  the 
compilation of user requirements and of the coordination of the contributions of various 
GMES partners which continue to act according to their mandate and own governance 
scheme.  

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• 

• 

• 

Option  G2:  The  Commission  could  propose  to  create  a  new  external  entity  (e.g.  a 
Community  agency,  or  to  extend  the  mandate  of  an  existing  Community  entity)  to 
manage the programme on its behalf. 

Option G3: A single governance body managing all GMES elements and representing 
all stakeholders is established. 

Option  G4.  The  responsibility  for  overall  programme  management  is  delegated  to  the 
ESA. 

The baseline scenario described above would correspond to a combination of the no change 
S0-G0  options.  It  serves  as  the  benchmark  for  the  impacts  of  the  other  scenarios.  The 
combination of options on Sustainable funding and Governance can be summarised as follows 
and leads to the further analysis of four scenarios. 

G0 

G1 

G2 

G3 

G4 

S0 

S1 

S2 

Base line 

Discarded 

Discarded 

Discarded 

Discarded 

Discarded 

Scenario 1 

Scenario 2 

Discarded 

Discarded 

Discarded 

Scenario 3 

Scenario 4 

Discarded 

Discarded 

All  combinations  involving  options  S0  and  G0  are  discarded  because  they  correspond  to  a 
large  extent  to  the  baseline  described  above.  Finally,  all  combinations  involving  option  G4 
have been discarded for two main reasons. First, the governance framework must respect the 
role  of  the  Commission  as  defined  in  the  EC  Treaty  and  the  jurisprudence  of  the  European 
Court  of  Justice  concerning  the  institutional  balance  within  the  EC.  Consequently,  it  is  not 
possible  that  the  Commission  delegates  the  political  responsibility  for  coordinating  and 
managing  the  GMES  programme  to  an  external  entity,  such  as  ESA.  Additionally,  the 
implementation  of  GMES  extends  beyond  the  technical  capacity  and  mandate  of  ESA.  In 
particular,  although  ESA  is  assigned  a  key  coordination  role  for  the  space  component,  for 
political, practical and legal reasons, it cannot be delegated the management of the in situ and 
service components. 

The  combination  of  options  that  are  not  discarded  are  analysed  in  the  light  of  the  specific 
objectives of the Communication as set out in the table below. 

Transparent 
and 
sustainable 
governance 
framework 

+ 

+ 

++ 

+ 

Objectives 

Users buy-in 

Stabilisation 
of industrial 
base 
(upstream and 
downstream) 

Feasibility in 
needed 
timeframe 

+ 

+ 

++ 

++ 

- 

- 

++ 

++ 

+ 

-- 

+ 

-- 

Scenario 1 

Scenario 2 

Scenario 3 

Scenario 4 

The timely submission of a proposal for a Community programme to ensure continuity after 
the  preparatory  actions,  as  foreseen  in  Scenario  3,  seems  to  best  fit  the  Communication 

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objectives and best respond to stakeholders' concerns expressed so far. Its combination with 
an internal Commission management structure would minimise implementation obstacles. 

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1. 

SCOPE OF THE IMPACT ASSESSMENT 

1.1.  What is GMES? 

The  objective  of  GMES  is  to  provide  services  allowing  access  to  accurate 
environmental  and  security  data  and  information,  tailored  to  the  needs  of  a  wide 
range  of  users  such  as  European  and  national  policy  makers,  scientists,  companies, 
health and environmental agencies, NGOs and private citizens. 

GMES  will  deliver  services  under  the  supervision  of  the  EU  in  the  fields  of  land, 
marine and atmosphere monitoring as well as in support of emergency and security 
management.  The  GMES  Bureau,  whose  task  it  is  to  federate  the  user  needs 
proceeded with a consultation of the various user communities in 2006/2007. Annex 
II of this impact assessment identifies the consolidated needs as expressed by users 
for (i) monitoring of the earth components (land, marine and atmosphere) and (ii) a 
contribution to emergency and security management. 

GMES is conceived as a system of systems and its development and implementation 
are  based  on  maximising  the  use  of  existing  European  capacities.  The  EU 
concentrates its actions on filling the gaps in full respect of the subsidiarity principle. 
As such, GMES is a partnership involving different actors: 

•  the Commission, acting on behalf of the European Communities, 

•  agencies of the EC, in particular the European Environmental Agency (EEA) the 
European  Maritime  Safety  Agency  (EMSA),  and  the  European  Agency  for  the 
Management  of  Operational  Cooperation  at  the  External  Borders  of  Member 
States , 

•  the  European  Space  Agency  (ESA)  that  will  implement  the  space  component  of 

GMES, 

•  EUMETSAT,  which  could  operate  space  observation  systems  on  behalf  of  the 

EC; 

•  owners and operators of space and in situ observation infrastructure that produces 

data needed for GMES services; 

•  GMES service providers, 

•  Users,  including  downstream  service  providers  and  European  and  national 

authorities. 

While  the  first  objective  of  GMES  is  to  enhance  the  available  Earth  observation-
based information to the benefit of informed policy making, it is expected that, once 
the  information  of  GMES  services  is  fully  and  openly  available,  it  will  allow  the 
development of a downstream sector where value-adding service providers will use 
them  to  develop  and  provide  tailor-made  services  for  their  own  customers.  For 
example, the GMES Atmosphere Services can be used as an input by value-adding 
companies to produce targeted air quality monitoring information to local customers. 

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Likewise,  the  combination  of  GMES  land  monitoring  service  and  meteorological 
information  will  allow  the  marketing  of  precision  farming  information  tools  to 
farmers. This market will develop only if potential enterprises are confident that the 
available services will be sustained on a long-term basis. 

The observation data necessary to feed the catalogue of GMES services are derived 
from observation infrastructure, which is divided into space-borne infrastructure and 
"in situ" infrastructure, the latter including seaborne, airborne, or ground-based data. 
Many  of  these  observation  systems  already  exist  and  have  been  developed  by 
Member  States  for  their  own  needs,  either  directly  or  through  intergovernmental 
organisations. The challenge for GMES is therefore two-fold: 

•  create a system of systems based on a coordination of existing capabilities and the 

development of new ones where gaps are identified; 

•  make  these  systems  sustainable,  which  means  ensuring  the  availability  of 
infrastructure  (and  of  the  services  derived  from  data  collected  through  that 
infrastructure) on a long-term basis. 

The socio-economic case for GMES, or GMES as the initiative has been called until 
now, was demonstrated by several studies. Annex III to the Impact Assessment gives 
some  details  on  these  studies,  both  in  terms  of  general  benefits  and,  more 
particularly, on the expected impact on downstream industry. 

1.2. 

Defining the scope of the analysis 

The  decision  to  implement  GMES  (now  GMES)  has  already  been  taken.  In  a 
Resolution in 2001, it was mentioned that the Council “URGES the Commission to 
start, in close coordination with the ESA, the initial period of global monitoring for 
environment  and  security  (GMES),  […]  STRESSES  the  importance  of  the  initial 
period  in  preparing  the  next  phase  of  GMES,  aimed  at  achieving  by  2008  an 
operational  and  autonomous  European  capability  for  global  monitoring  for 
environment and security based on a sound cost/benefit assessment and avoiding any 
overlap with activities carried out under the common foreign and security policy".  

The  decision  to  implement  GMES  is  therefore  beyond  the  scope  of  the 
Communication and consequently of the present impact assessment analysis. Instead, 
the Communication addresses the issues of governance and funding that need to be 
clarified  in  order  to  ensure  the  operational  implementation  of  GMES  within  a 
reasonable time frame.  

As such, the Communication is not intended to create any financial impact on the EC 
budget whatsoever and it does not amount to a formal proposal for the governance 
and funding of GMES. As outlined in the Communication, the formal proposal for a 
Basic Act establishing a GMES programme is expected to be tabled in 2009 by the 
Commission. The Impact Assessment accompanying this Commission proposal for a 
Regulation will analyse the financial impact in a detailed manner. In Chapter 7 of the 
Communication  it  is  explained  that  the  share  of  the  EU  budget  will  depend  on  the 
scope of the activities funded and managed at EU level.  

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This  two  step  approach,  consisting  of  a  Communication  published  in  2008  and  a 
proposal for a Basic Act published in 2009, is considered of paramount importance 
for the success of GMES for the following reasons: 

to  convey 

the  political  messages  contained 

•  For strategic reasons, it is essential to use the current momentum created by the 
the 
French  presidency 
Communication already in 2008, with a  view towards a providing the (political) 
grounds for a comprehensive legal act for the initiative in 2009. These messages 
include the way forward for the establishment of a GMES programme, objectives 
for  a  GMES  data  and  information  policy  and  the  governance  and  financing  of 
GMES. It is of key importance to give this message in 2008 in order to avoid that 
other  stakeholders  (in  particular  States  participating  in  the  GMES  Space 
Component  Programme  of  ESA)  reconsider planned investments due to the lack 
of progress at Community level (see also the bullet below); 

in 

•  the  Communication  will  also  constitute  a  decisive  input  for  ESA  Ministers  that 
will  have  come  to  a  decision  concerning  the  continuation  of  GMES  space 
infrastructure  development  in  the  framework  of  the  GMES  Space  Component 
Programme in November 2008; 

•  it cannot be excluded that the basic legal act published in 2009 will not comprise 

all the aspects that are covered by this Communication;  

•  a  two  step  approach  was  followed  in  previous  cases  in  order  to  structure  the 
debate  concerning  Community  actions  in  complex  high  tech  sectors,  including 
electronic communications1 and the Shared Environmental Information System2; 

•  the  Commission  has  received  a  mandate  from  Council  in  the  Resolution  on  the 
European  Space  Policy  of  21  May  2007  to  propose  appropriate  mechanisms  for 
the financing and effective management of GMES in 2008; 

•  in  its  the  Resolution  “Taking  forward  the  European  Space  Policy”  of  26 
September  2008,  the  Council  welcomed  “the  intention  of  the  Commission  to 
address  all  of  these  issues  in  a  Communication  to  be  adopted  by  the  end  of 
October 2008, having consulted with the main stakeholders, in particular agreeing 
with ESA an overall programmatic approach for the GMES Space Component.” 

The objective of the GMES Communication is thus to give a political message and to 
establish a basis for further discussions and consolidation of the political consensus 
among the various partners involved in this initiative. The Communication does not 
to  create  any  financial  commitments  for  the  Commission  and  does  in  no  way 
prejudge future financial decisions concerning GMES.  

1  

2  

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the  Review  of 

the  Communication  on 

See 
the  EU  Regulatory  Framework  for  electronic 
communications networks and services, COM(2006) 334 of 29 June 2006 that preceded the proposals 
for an amendment of legislative acts tabled on 13 November 2007. 
See  the  Communication  entitled  “Towards  a  Shared  Environmental  Information  System  (SEIS)”, 
COM(2008)46  final  of  1  February  2008  that  will  eventually  be  followed  b  a  revision  of  the 
Standardised Reporting directive 91/692/EC. 

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In line with the principle of proportionality, the present Impact Assessment is framed 
within  the  scope  outlined  in  the  paragraphs  above.  It  goes  without  saying  that  all 
subsequent measures eventually proposed, after further discussions with stakeholders 
on  the  basis  of  the  orientation  defined in the Communication, will be subject to an 
assessment of their own impact, including a careful evaluation of their costs. As it is 
currently foreseen that a proposal for a Basic Act establishing the GMES Programme 
could be published in 2009, the relating Impact Assessment will have to be prepared 
in the first half of next year, at the latest. 

2. 

PROCEDURAL ISSUES AND CONSULTATION OF INTERESTED PARTIES 

2.1. 

Organisation and timing 

This  Impact  Assessment  has  been  prepared  with  reference  to  the  following 
Commission  Legislative  and  Work  Programme  priority  item  for  2008:  GMES 
Communication. The foreseen adoption of the Communication is November 2008. 

Work on the Impact Assessment started in 2006 by an intensive consultation process 
summarised  below,  which  fully  meets  the  Commission's  standards.  In  parallel,  an 
analysis of external studies was performed and a new study was launched to have a 
clear picture of the competitiveness of the existing EU GMES downstream sector of 
Earth  observation-based  service  industries,  and  of  the  potential  impacts  that  the 
GMES  services  might  have  on  this  market.  An  Inter-service  Steering  Group  was 
established  at  the  end  of  2007  by  enlarging  the  existing  GMES  Bureau  Steering 
Committee  (AGRI,  FISH,  RELEX,  DEV,  ECHO,  AIDCO,  TREN,  JLS,  TAXUD, 
OLAF,  REGIO,  ESTAT,  RTD,  INFSO,  ENV,  JRC)  to  horizontal  services 
(Secretariat-General and DG Budget). This Group met three times between February 
and July 2008 and written comments were exchanged between meetings. 

On  3  September  2008,  the  draft  Impact  Assessment  was  discussed  with  the  Impact 
Assessment  Board,  that  sent  its  opinion  to  DG  ENTR  on  10  September  2008.  The 
Impact Assessment was re-submitted to the Impact Assessment Board on 1 october 
2008. The Impact Assessment Board adopted its second opinion on 14 October 2008. 
The  recommendations  from  the  Impact  Assessment  Board  are  reflected  in  the 
following parts of the present document: 

•  existing  budgetary  and  political  commitments  of  the  Commission  with  regard  to 
GMES  are  explained  in  detail  in  chapter  3.2,  which  now  also  contains  an 
overview of the role and functioning of the GMES Bureau, and Annex IV;  

•  the added value of the Communication is underlined in Chapter 1.2.; 

•  it  is  made  clear  that  the  Communication  does  not  prejudge  future  financial 

decisions concerning GMES in chapter 1.2; 

•  a  specific  option  concerning  management  of  the  programme  by  ESA  has  been 

defined in Chapter 5.2.; 

•  the analysis of Scenario 1 (internal Commission management through a dedicated 

internal structure) has been deepened significantly; 

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•  stakeholder involvement has been described in more detail throughout Chapter 6.  

2.2. 

Consultation and expertise 

A  number  of  external  studies,  some  specifically  targeting  GMES  and  others  Earth 
observation from a more general perspective, are available and have been analysed in 
support of this impact assessment. A list of these studies is presented in Annex 13. 

2.3. 

Stakeholders consultation  

In 2005 the Commission issued a Communication entitled "GMES, from concept to 
reality", which outlined the roadmap towards the availability of first pre-operational 
services by 2008. 

In  2006  the  GMES  Bureau  was  created  by  Commission  decision  as  part  of  the 
Directorate  General  for  Enterprise  and  Industry  in  the  European  Commission.  The 
Bureau  has  the  task  of  federating  the  user  needs  and  preparing  the  transition  of 
GMES  to  operational  status,  which  implies  preparing  the  necessary  financing  and 
associated governance scheme. 

Since then a wide consultation process with stakeholders has taken place: 

•  the  preparation  of  each  service  (land,  marine,  emergency,  atmosphere,  security) 

was initiated by a thematic workshop gathering users of the future service; 

•  except  for  the  Security  domain  which  raises  specific  political  and  institutional 
issues, the workshops were followed by the setting up of 'Implementation groups' 
(composed of user representatives) with the task of describing scope, architecture 
and implementation plans for each service, including the necessary infrastructural 
requirements; 

•  experts were selected to join these groups and others were seconded to the GMES 

Bureau to assist the Commission in developing GMES; 

•  one  important  channel  for  consulting  stakeholders  is  the  GMES  Advisory 
Council4, which also gives access to a network of dedicated national coordinators. 
These  coordinators  have  the  specific  role  of  mobilising  their  national  user  and 
developer communities, therefore representing a wide range of stakeholders. 

•  the  European  Commission's  GMES  Bureau  has  had  regular  bilateral  meetings 
with  stakeholders  from  industry,  regions  and  other  actors  in  order  to  gather  the 
widest  possible  input  from  users  and  developers  of  GMES/GMES  services  and 
related infrastructure. 

3 

4 

The GOSIS study in particular looked more specifically at the governance aspects of GMES rather than 
at the benefits linked to GMES as a whole. 
The GMES Advisory Council brings together EU/ESA Member States, the European Commission and 
ESA, as well as other stake-holders on an ad-hoc basis: relevant international organisations (e.g. EEA, 
EUMETSAT,  European  Maritime  Safety  Agency,  EU  Satellite  Centre,  etc.),  representatives  of  end-
users, industry, service providers, research organisations, academia.  

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•  successive  EU  Presidencies  have  organised  conferences  dedicated 

to 
GMES/GMES5, gathering stakeholders around specific aspects of the programme; 

Annex  II  to  this  impact  assessment  is  a  synthesis  of  the  results  of  this  intensive 
consultation process. As an overall synthesis, it may be said that stakeholders believe 
that GMES is an initiative of key political importance and has created benefits both 
for service providers and users through significant R&D investment by the EU, ESA 
and their respective Member States. 

R&D investments, however, are not a goal by themselves, but have been made with a 
view  to  preparing  an  operational  provision  of  GMES  services.  The  stakeholder 
consultation  has  clearly  demonstrated  that  users,  including  the  downstream  service 
sector,  require  access  to  a  continuous  and  sustainable  flow  of  high-quality 
information  produced  by  GMES  service  providers  that  cannot  be  ensured  in  the 
framework of research projects. 

Stakeholders have thus confirmed the need to create a legal basis for an operational 
GMES programme in order to: 

•  consolidate  the  contributions  of  the  various  partners  involved  in  GMES,  taking 
into  consideration  the  roles  of  the  EU,  ESA,  EUMETSAT,  their  respective 
Member  States  and  of  other  organisations  as  necessary,  including  international 
partners; 

•  ensure that, as a user-driven initiative, GMES is designed in such a way that there 
is  continuous  uptake  of  user  requirements  through  on-going  consultations  with 
users communities and integration of their changing needs in an iterative process; 

•  implement  financial  and  programmatic  schemes 

long-term 
sustainability  of  GMES,  efficient  management  of  Community  funds  and 
continuation of support to scientific and technical service evolution; 

to  guarantee 

•  facilitate market uptake by the value-adding service industry (including SMEs) by 
ensuring  an  open  data  policy  that  maximises  the  use  and  sharing  of  GMES  data 
and information products (to the extent permitted by data owners) and contribute 
to the sustainability of the infrastructure that provides data for GMES. 

3. 

WHAT IS THE CHALLENGE? 

3.1. 

Problem definition 

The extensive stakeholder consultation, which started with the 2005 Communication 
"From  concept  to  reality",  has  indicated  that  the  following  major  shortcomings  are 

5 

See the conference organised by the Austrian presidency in June 2006 “A Market for GMES in Europe 
and its regions - the Graz Dialogue”, Munich conference "The Way to the European Earth Observation 
System GMES - Munich Roadmap" organised by the German presidency in April 2007, the “Bridging 
the  Gap:  Responding  to  environmental  change  -  from  words  to  deeds”  conference,  hosted  by  the 
Slovenian  presidency  in  Portoroz  in  May  2008,  and  the  forthcoming  GMES  Forum  organised  by  the 
French presidency in Lille in September 2008.  

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hindering the progress towards the realisation of the political and operational goals of 
GMES: 

•  despite the user-driven character of GMES and the set up of expert groups (known 
as service implementation groups), there is currently no formal process to involve 
the users in the definition of the scope and architecture of the services. This means 
that there is no formal assurance that users get what they need in terms of services 
and that the observation infrastructure is adequate to deliver the necessary data; 

•  equally, there is no process to consolidate the contributions of the various partners 
in  the  development  of  GMES,  which  could  result  in  a  duplication  of  efforts  in 
Europe.  In  this  context,  it  is  to  be  recalled  that  Member  States  and 
investing 
intergovernmental  organisations, 
significant sums in earth monitoring activities. Nevertheless, a common approach 
is  still  missing  among  co-existing  frameworks  at  EC,  intergovernmental  and 
national level that all have separate decision and financing mechanisms. To give 
best  added-value  to  its  contribution,  the  EU  should  be  able  to  coordinate  the 
contributions of other partners. There is also the need to involve regions and their 
networks in this process; 

in  particular  ESA,  have  been 

•  GMES  is  currently  a  set  of  research  projects  financed  by  the  EU,  ESA  and 
Member  States  budgets.  These  projects  aim  at  developing  services  and 
infrastructure, but cannot ensure a continuous and sustainable flow of information 
in an operational environment. The consequence of this situation is that users are 
reluctant to invest in adapting their working methods to the emerging services as a 
guarantee on their continued availability is lacking. Equally, the lack of an overall 
long-term  programmatic  scheme  is  seen  as  high-risk  by  the  adding-value 
downstream industry. Downstream market players are reluctant to invest as they 
cannot build business models based on short-term products available only within 
the  framework  of  a  consortia-led  research  project  that  are  not  subject  to  an 
operational  service  delivery  mechanism  and  may  impose  restrictions  on  the 
commercial use of data. 

This  means  that,  for  the  moment,  GMES  simply  amounts  to  a  number  of  research 
projects,  without  an  overarching  legal  and  financial  framework,  and  very  limited 
operational funds. Without changes to this scenario, an operational capacity required 
to  provide  autonomous  and  strategic  information  on  matters  of  environment  and 
security cannot be realised. 

3.2. 

How would the problem evolve, all things being equal?  

The  evolution  of  the  problem,  all  things  being  equal,  corresponds  to  the  baseline 
scenario. The purpose of this subchapter is to describe the baseline scenario in terms 
of governance and financing aspects, taking into consideration existing financial and 
political  commitments  of  the  Commission.  A  more  detailed  description  of  political 
commitments of the Commission concerning GMES can be found in Annex IV. 

3.2.1.  Baseline scenario – governance aspects  

Currently,  the  steering  of  the  development  of  services  and  preparing  the  financing 
and governance for the longer term is under the responsibility of the GMES Bureau, 

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that was created - by Commission decision in 20066 - within the Directorate General 
for  Enterprise  and  Industry,  for  a  period  of  three  years.  The  tasks  of  the  GMES 
Bureau include: 

•  establishing the focal point for the co-ordination of GMES related activities of the 

Commission; 

•  identifying priorities related to GMES activities; 

•  consolidating  and  updating  Commission  needs  and  corresponding  technical 

requirements; 

•  developing a data policy and mechanisms to ensure long-term access to data and 
sharing, taking into account and supporting the implementation of the Community 
rules concerning the infrastructure for spatial information in the Community; 

•  establishing  relations  with  a  broad  range  of  providers  and  users  leading  to 

identification of an overall GMES management structure; 

•  developing  partnerships  based  on 

including 
strengthening relations in the framework of the Global Earth Observation System 
of Systems; 

international  cooperation, 

•  developing awareness and communication activities; 

•  developing  the  next  phase  going  beyond  Commission  needs  to  include  other 

European Union institutions and bodies. 

Staff from other the Directorates-General of the Commission, in particular the JRC, 
the  European  Space  Agency,  the  EEA  and  national  experts  have  been  assigned  to 
work in or with the Bureau.  

The Bureau receives guidance from a Steering Committee consisting of Commission 
services which are users of GMES services, and is assisted by the GMES Advisory 
Council. The primary mission of the GAC is to: 

•  provide  strategic  advice  to  the  GMES  Bureau  concerning  the  long-term 
implementation  of  GMES  services,  creating  favourable  conditions  enabling  the 
development of services, stressing the user driven orientation of GMES, the need 
for interoperability, data harmonisation and avoidance of duplication of efforts; 

•  foster  the  co-ordination  among,  and  the  complementary  role  of  European  and 
national activities, thereby encouraging the creation of a “GMES partnership”, as 
outlined in the GMES Communication; 

•  facilitate  consensus-building 

in 
development of a GMES capacity. 

the  relevant  community(ies)  around 

the 

6 

See Decision C(2006) 673 of 8 March 2006. 

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The mandate of the GMES Bureau expires at the end of May 2009. The Commission 
has  no  obligation  whatsoever  to  prolong  this  mandate.  Although  the  Terms  of 
Reference  of  the  GAC  do  not  contain  a  reference  to  its  duration,  the  GAC  would 
loose its main objective, namely to provide strategic advice to the GMES Bureau, in 
the event the Bureau ceased to exist. 

From  a  governance  perspective,  the  baseline  scenario  would  thus  correspond  to  a 
situation  where  the  mandate  of  the  GMES  Bureau  is  not  prolonged  and  no  other 
dedicated  structure  is  created  in  the  Commission  to  replace  it  with  a  view  to 
compiling user needs.  

This  means  that  regarding  the  EU  budget  the  funds  available  for  GMES  under  the 
space  theme  of  the  7th  Framework  Programme  (FP7)  would  simply  be  managed  in 
line  with  standard  FP  7  rules,  without  a  specific  management  structure  within  the 
Commission services.  

Activities of Member States and intergovernmental organisations, in particular ESA, 
in  the  field  of  earth  monitoring  would  continue  without  a  general  governance 
framework.      

3.2.2.  Baseline scenario – financing aspects 

Thus  far,  important  investments  have  already  been  made  in  the  EU  and  other 
intergovernmental entities. Within FP 6, the EU has spent 100M€ on GMES projects, 
whereas ESA invested another 100M€ in th e GMES Service Elements projects. In FP 
7, the EU will make available 550M€ for GM ES service projects and procurement of 
data  for  these  Services.  Additionally,  650  M€  will  be  used  to  contribute  to  the 
development of the ESA Space component programme, which amounts to 1236 M€ 
for  its  first  segment  1.  ESA  Member  States  will  make  a  decision  concerning  the 
financing of the second segment of this programme in November 2008. 

Despite these research investments, the Commission does not have a political or legal 
commitment  to  finance  operational  activities  following  up  on  research  actions. 
According to the 2005 Communication “GMES – From concept to reality”, GMES is 
to  be  developed  in  steps  through  the  introduction  of  fast  track  and  pilot  phase 
services, starting with three fast track services (land, marine, emergency) by the end 
of 2008. These fast track services will be launched this year on the basis of research 
funds. This demonstrates that GMES could be continued simply as a research effort 
without violating political commitments of the Commission.  

In  addition  to  the  funding  of  research  projects  through  FP  7,  the  Commission  is 
implementing a preparatory action (3 M€ in 2008 7) to prepare proposals with a view 
to  the  adoption  of  future  actions.  Nevertheless  the  fact  that  a  preparatory  action 
exists, with a very limited scope (emergency services) does not imply a commitment 
for the Commission to make a proposal that covers all the areas mentioned in chapter 
3.1. above. 

7 

A  budget  of  a  comparable  order  of  magnitude  was  requested  for  2009.  The  Commission  intends  to 
request a further budget to continue the preparatory action in 2010. 

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From  a  financial  perspective,  the  baseline  scenario  would  thus  mean  that  no 
operational funds are requested by the Commission in addition to existing FP 7 funds 
and the preparatory action, which cannot last longer than three years in accordance 
with Article 49 of the Financial Regulation.  

3.2.3. 

Impact of the baseline scenario 

This  baseline  would  undermine  users'  and  industrial  confidence  in  GMES.  The 
disappearance of any internal Commission structure to federate user needs, together 
with the discontinuation of operational funding in the absence of a legal base, would 
mean that the EU would not have the necessary decision making power for the future 
governance of GMES. 

•  On  the  users'  side,  the  baseline  would  be  read  as  a  lack  of  commitment  of  the 
Commission towards GMES8. As a consequence, confidence in this initiative as a 
whole would be lost and users would not invest to modify their own structures in 
order to integrate the first available services. As no entity would exist in charge of 
federating  user  needs  and  taking  them  into  account  in  shaping  services,  GMES 
would  be  seen  as  a  technology-push  project  (but  without  political  support),  of 
little interest to users9. 

•  On the service provider side, according to the stakeholder consultation, the main 
disappointment  would  come  from  the  absence  of  perspective  of  EU  financing 
outside research budgets. Service providers would probably still continue seeking 
research co-financing and therefore co-investing in GMES for a short time, but the 
absence of a flourishing Earth Observation downstream market coupled with the 
maturity of most GMES projects (already at the level of demonstration rather than 
pure research), would very likely preclude continued interest from industry. 

•  On the infrastructure side, the stakeholder consultation demonstrated that it would 
become  extremely  difficult  to  justify  European  investment  in  the  absence  of 
European-level  user  representation.  The  already  approved  co-financing  of 
satellites through ESA would represent a sub-optimal investment if the data from 
those satellites could not be used for sustainable operational services but only for 
research  purposes.  As  a  result,  the  continuation  of  those  observation  capacities 
would  be  put  at  risk.  In  parallel,  no  downstream  business  would  be  created  or 
expanded  without  the  certainty  that  the  necessary  flow  of  data  will  be  there 
without interruption; 

•  Regarding  the  activities  of  public  authorities  in  the  field  of  Earth  monitoring 
(including  regional,  national  and  intergovernmental  authorities),  the  baseline 
scenario would mean that the development and operation of infrastructure and the 
provision  of  services  at  regional,  national  and  intergovernmental  level  could 
remain  fragmented.  Without  a  governance  framework  for  GMES,  which  would 
provide for efficient coordination mechanisms a risk of infrastructure and service 
duplication  exists 

8 

9 

As  outlined  in  the  Vega  study  entitled  “The  state  of  the  health  of  the  European  and  Canadian  EO 
industry in 2006“, the downstream sector is still dependent on public investments.  
In its study entitled „Space 2030, Tackling society’s challenges“ the OECD confirmed the necessity to 
encourage private and public sector use of space data. 

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3.3. 

Does the EU have the right to act? 

The Communication responds to a mandate defined in Paragraph 6 of the Resolution 
on  the  European  Space  Policy10.  Further,  the  governance  and  financing  schemes 
proposed in the Communication have been examined in the light of the subsidiarity 
principle.  Past  experience  has  clearly  shown  that  the  national/intergovernmental 
framework alone is inadequate to move GMES to an operational stage. Action at EU 
level  will  not  replace  but  rather  complement  actions  at  Member  States  and 
intergovernmental levels (ESA, EUMETSAT, etc.) in order to achieve the common 
policy objectives. The overall structure will be designed so that GMES remains user-
driven.  The  step-by-step  approach  followed  until  now  in  the  GMES  development 
will be further promoted. Therefore the approach proposed in the Communication is 
fully in line with the subsidiarity principle. 

4. 

WHAT ARE THE OBJECTIVES OF THE COMMUNICATION 

As GMES is a system of systems building on existing capacities at regional, national 
and  intergovernmental  level,  the  EU  needs  to  formalise  and  consolidate  its 
involvement  in  terms  of  decision  making  and  financing  and  ensure  that  its  own 
interest  as  a  principal  user  of  GMES  services  is  preserved.  To  this  aim,  it  will  be 
necessary to formalise the contributions of all GMES partners in the same way and 
establish  the  programme  as  a  contribution  to  a  partnership  of  different  actors  in 
which the EU plays an important role. 

Moreover,  in  order  for  the  envisaged  benefits  to  materialise,  it  is  necessary  to 
establish  a  framework  for  a  programme  definition  and  implementation,  with 
particular focus on the involvement of users and the appropriate management of EU 
financial  resources,  in  addition  with  resources  contributed  by  other  partners  and 
mobilised for the common objectives. 

Consequently, the EU has to fulfil a double role: 

•  the  overall  partnership  coordination  including  contributions  financed  by  other 

partners at national, regional, local and intergovernmental levels. 

•  the implementation of the Community contribution in this partnership. 

4.1. 

Objectives 

The main objective of the 2008 Communication is therefore to 

•  address  the  fundamental  problems,  namely  lack  of  governance  structures, 

sustainable funding and user representation; and 

•  indicate  the  willingness  of  the  Commission  to  propose  a  Basic  Act  establishing 
the  EU  GMES  programme,  which,  however,  does  not  prejudge  future  financial 
decisions. 

10 

OJ C136/2 of 20.6.2007. 

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The specific objectives of the Communication are to: 

(5) 

(6) 

(7) 

(8) 

define  a  transparent  and  sustainable  governance  framework  that  contains  a 
clear division of the roles of the partners in the GMES partnership, based on 
the  principle  that  GMES  should  use  to  the  largest  extend  possible  existing 
capacities; 

guarantee user uptake, in particular through constant involvement of users so 
that GMES remains user driven 

reassure  stakeholders  about  the  EU  commitment  to  GMES  in  the  sensitive 
phase of demonstration which precedes the move to operation;  

outline  how  the  governance  and  financing  framework  can  be  implemented 
within a reasonable timeframe. 

While  the  Communication  will  only  identify  broad  principles  and  orientations,  the 
detailed  elements  (scoping  of  the  services,  development  and  management  of  the 
observation  infrastructure,  share  and  proportion  of  the  EU  funding  in  the  various 
GMES components) will be defined at a later stage in the proposal of a legal act. As 
stated  above,  these  measures,  which  will  be  presented  as  a  follow-up  the 
Communication,  will  be  accompanied  by 
impact  assessment. 
Consequently,  the  Communication  does  in  no  way  prejudge  future  financial 
decisions and therefore does not have a financial impact on the EU budget.  

their  own 

4.2. 

Consistency with other EU policies 

4.2.1.  General considerations 

GMES is a tool in support of existing EU policies as well as their implementation by 
Member  States.  Its  Earth  Observation-based  services  are  meant  to  inform  and 
support policy decisions that are knowledge-based, proportionate and effective, while 
respecting  the  principle  of  subsidiarity.  Among  these  policies,  there  are  areas  of 
strategic importance such as climate change, security and the European Space Policy. 
GMES will similarly enable a better assessment and evaluation of the effectiveness 
of EU policies, e.g. with regard to air pollution or water quality. For Member States, 
GMES  will  make  it  easier  to  fulfil  their  monitoring  and  reporting  obligations 
imposed  by  European  legislation  e.g.  in  the  field  of  environment.  Finally,  GMES 
should also be a tool for cooperation actions linked to development, humanitarian aid 
and emergency situations worldwide, and more specifically with Africa11. 

GMES  will  be  expected  to  have  a  significant  impact  on  the  streamlining  of  such 
reporting  requirements  through  consistent  data  and  information  approaches  from 
European to national and regional levels. Additionally, the Commission will ensure 
complementarity  and  consistency  with  other  Community  policies,  in  particular  in 
relation  to  competition,  the  European  GNSS  programmes  (see  chapter  4.2.2),  the 

11  

In Africa, presently the Lisbon GMES Process is being implemented in collaboration with the African 
Union  Commission  and  the  African  RECs.  This  will  lead  to  a  pan-African  Earth  Observation 
programme  in  the  framework  of  the  EU-Africa  Partnership  on  S&T,  Information  Society  and  Space 
Technologies.. 

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protection  of  personal  data,  the  establishment  of  an  infrastructure  for  spatial 
information in the European Community (INSPIRE), and the cohesion policy12.  

the  environmental  sphere, 

In 
the  Communication  announcing  a  Shared 
Environmental  Information  System  (SEIS)  adopted  in  February  2008  sets  out  the 
Commission's view on the approach needed to modernise and simplify the collection, 
exchange  and  use  of  the  data  and  information  required  for  the  design  and 
implementation  of  environmental  policy.  SEIS  is    based  on  a  number  of  principles 
that  the  Commission  sees  as  necessary  in  order  to  take  full  advantage  of  modern 
technology  to  provide  the  information  base  needed  to  address  environmental 
challenges.  In  this  context,  GMES—now  GMES—is  seen  as  a  basis  for  improving 
the provision of services both to public policy makers and to citizens. 

Moreover,  GMES  services  produce  information  for  monitoring  and  understanding 
climate change and may contribute towards improvements in the transport sector and 
the deeper marine knowledge needed for implementation of the EU's new Integrated 
Maritime Policy13. 

It should also be mentioned that GMES is fully in line with the regional policy of the 
EU.  Within  the  Regions  For  Economic  Change  initiative  funded  under  the 
INTERREG IVC and URBACT II programmes, transnational networks of voluntary 
regions can work together to capitalise on the wealth of knowledge, experience and 
good practice available in other regions. This initiative works on the basis that ideas, 
tools  and  approaches  are  developed,  experiences  exchanged,  and  these  then  can  be 
'Improving 
implemented 
monitoring of environment and security by and for the regions' is one of the themes 
recommended  by  the  Commission.  Finally,  the  development  of  an  Urban  Atlas 
included  in  the  Land  Monitoring  Core  Service  is  financed  through  the  budget  for 
regional development.  

the  mainstream  Operational  Programmes. 

through 

Finally,  the  GMES  services  are  considered  essential  not  only  because  their  more 
direct users are policy makers, but also in order to stimulate innovation and growth in 
the  downstream  sector.  The  Earth  Observation-based  services  sector  is,  in  fact, 
expected  to  develop  much  faster  owing  to  GMES,  mostly  to  the  benefit  of  SME's. 
While  the  GMES  downstream  sector  competitiveness  study  has  shown  how  this 
sector is today relatively small and in an immature stage, the availability of GMES 
services  has  the  potential  to  accompany  the  sector  towards  maturity  while  creating 
innovation  spin-offs  in  other  sectors,  but  also  to  integrate  GMES  information  in 
major  industrial  sectors  such  as  energy,  agriculture,  water  resources  management, 
transports, etc. In these aspects, GMES fully supports the Lisbon objectives. 

4.2.2.  Consistency with the European GNSS programmes (EGNOS and Galileo) 

Galileo and GMES are both flagship programmes of the European Space Policy. It is 
therefore  of  paramount  importance  to  avoid  inconsistencies  between  Galileo  and 
GMES,  to  use  synergies  to  the  maximum  extent  possible,  and  to  take  into 

12 

13 

The Community Strategic guidelines on Cohesion 2007 and 2013 underline the need to strengthen the 
links  between  environmental  protection  and  growth  and  make  specific  reference  to  GMES  in  section 
1.1.2. 
An  Integrated  Maritime  Policy  for  the  European  Union  ("The  Blue  Book"),  Brussels,  10.10.2007, 
COM(2007) 575 final 

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consideration  lessons  learned  from  Galileo  and  the  European  Geostationary 
Navigation  Overlay  Service  (EGNOS),  a  predecessor  of  Galileo.  For  this  reasons, 
staff members of DG TREN and DG ENTR are in regular contacts at working level. 
Further,  the  governance  and  financing  of  Galileo  has  been  assessed  in  detail  in  the 
context of the assessment of the options analysed in chapter 6 below. Nevertheless it 
should be recalled that major differences exist between Galileo and GMES: 

•  technically  speaking,  GMES  and  Galileo  cover  two  different  fields:  GMES  is 
essentially  an  Earth  observation  programme,  whereas  Galileo  is  a  satellite 
navigation programme; 

•  the  architecture  of  GMES  infrastructure,  a  system  of  systems,  is  much  more 

complex than the architecture of Galileo and EGNOS; 

•  the  five  Galileo  services  will  mainly  depend  on  input  from  Galileo  space 
infrastructure,  whereas  GMES  services  will  use  input  from  multiple  sources, 
including  space  infrastructure  co-financed  by  the  EC  and  contributing  space 
missions, and a large variety of in situ infrastructure.  

Further,  it  should  be  recalled  that  the  management  structures  established  for  the 
Galileo development phase (in particular the Galileo Joint Undertaking created under 
Article  171  of  the  EC  Treaty)  are  of  limited  relevance  for  the  purpose  of  the 
Communication,  which  mainly  covers 
institutional  and  financial 
framework  for  operational  activities.  A  Joint  Undertaking  is  body  established  for 
research and development purposes according to the EC Treaty. Therefore they could 
not be used to manage operational GMES activities14.  

legal, 

the 

The  Community  agency  that  assists  in  the  management  of  deployment  and 
operational  phases  of  the  European  GNSS  programmes,  the  GNSS  Supervisory 
Authority  (GSA),  is  also  currently  not  entirely  relevant  for  GMES  because  of  the 
moratorium concerning the establishment of new regulatory agencies (see Scenarios 
2 and 4 below).  

5. 

POLICY OPTIONS 

For  the  sake  of  clarity,  policy  options  will  be  outlined  separately  for  the  two  key 
issues  covered  by  the  Communication:  sustainability  of  funding  and  governance 
scheme.  These  options  are  based  on  the  assumption  that  GMES  services  will  be 
made  available  fully  and  openly,  unless  this  would  endanger  EU  security  interests. 
This  will  help  to  promote  the  widest  possible  use  and  sharing  of  Earth  observation 
data  and  information  according  to  the  principles  of  the  European  Shared 
Environmental  Information  System  (SEIS)15  and  Global  Earth  Observation  System 
of  Systems  (GEOSS)  initiatives.  Additionally,  public  investment  will  encourage 
industry  to  explore  innovative  ways  of  integrating  observing,  communications  and 

14 

15  

For  the  sake  of  completeness  it  should  be  mentioned  that  the  co-operation  with  ESA  relating  to  the 
development  of  space  infrastructure  for  GMES  (the  Sentinel  missions)  is  based  on  a  delegation 
agreement under Article 53d of the Financial Regulation, whereas the other funds available under FP 7 
for GMES are managed under standard grant mechanisms, in line with normal FP 7 procedures.  
Towards a Shared Environmental Information System (SEIS) (COM(2008) 46 final ) 

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information technologies and should facilitate market uptake by value-adding service 
providers, notably Small and Medium Enterprises (SME).  

5.1. 

Options on Sustainable financing 

Concerning the sustainability of financing (S) of service provision and contribution 
to infrastructure development and operations beyond research, policy options at hand 
are: 

•  No  action,  S0-option:  the  2008  preparatory  action  has  no  follow-up.  The  EU 
continues  to  limit  its  financial  contribution  to  GMES  to  research  funds,  without 
proposing a legal base for the continuation of the operational activities launched 
through the preparatory actions. 

•  Option S1: same as the previous option until 2013, but a programme is proposed 
in  the  context  of  the  preparation  of  the  next  financial  framework.  A  gap  is  left 
between the preparatory action (2008-2010) and 2014. 

•  Option  S2:  a  Community  programme  is  proposed  in  due  time  to  bridge  the  gap 
between 2011 and 2014, giving continuity to the preparatory actions and defining 
the role of the actors in the implementation of the GMES programme. 

The  exact  scope  and  the  underlying  rationale  of  the  activities  covered  either  by  a 
programme  starting  in  2014  (see  option  S1)  or  in  2011  (see  option  S  2)  will  be 
analysed in the Impact Assessment accompanying the corresponding Basic Acts. In 
this context, it is recalled that GMES is a system of systems that can be implemented 
in  a  modular  way,  depending  on  the  available  EU  resources,  which  will  determine 
the  EU  contribution  to  each  component  (Space,  In  situ,  services).  Unlike  Galileo, 
which  aims  at  deploying  a  constellation  with  a  predetermined  number  of  satellites 
and  (corresponding  ground  segment  facilities),  GMES  will  be  subject  to  a  phased 
implementation  approach.  For  instance,  the  current  agreed  priorities  include  the 
development  of  land  monitoring,  emergency  response,  marine  and  atmosphere 
services and corresponding infrastructure. 

5.2. 

Options on Governance schemes 

Concerning  the  roles  and  responsibilities  of  different  actors  (governance  scheme- 
G), policy options at hand are: 

•  No action G0 option: The mandate of the GMES Bureau is not prolonged in 2009 
and  no  other  dedicated  internal  management  is  created.  Further,  no  specific 
governance  structure  is  established  in  addition  to  applicable  rules  for  research 
funds. 

•  Option G1: The Commission takes strong political and managerial control and is 
in charge of the management of the GMES programme, a formal process for the 
compilation of user requirements and of the coordination of the contributions of 
various GMES partners which continue to act according to their mandate and own 
governance  scheme.  Within  the  Commission,  a  dedicated  internal  management 
structure  is  responsible  for  coordinating  GMES,  whose  mandate  should  be 
defined, based on the outcome of the evaluation of the GMES Bureau, which will 

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be  available  at  the  end  of  2008.  Technical  implementation  tasks  could  be 
delegated to other entities.  

•  Option G2: The Commission could propose to create a new external entity (e.g. a 
Community agency, or to extend the mandate of an existing Community entity) to 
manage the programme on its behalf. 

•  Option  G3:  A  single  governance  body  managing  all  GMES  elements  and 

representing all stakeholders is established. 

•  Option G4. The responsibility for overall programme management is delegated to 

the ESA. 

5.3. 

The discarded options 

An analysis in the light of the objectives presented in chapter 4.1. demonstrates that 
some options (or combination of options) are clearly not viable and will therefore not 
be discussed in further detail in chapter 6 below.  

In particular, combining the G0 option with options S1 and 2 is inconsistent because 
the  first  specific  objective  of  the  Communication,  namely  to  propose  a  stable  and 
transparent  governance  framework,  would  not  be  met.  In  fact,  any  combination 
involving  the  G0  option  would  pose  substantial  management  problems,  as  the 
preparation and management of a new programme either before or in the context of 
the  preparation  of  the  next  financial  framework  cannot  be  implemented  without  a 
responsible body, with appropriate mandate and staff. Although it would be possible, 
in  theory,  to  manage  Community  funds  simply  on  the  basis  of  the  Financial 
Regulation,  this  approach  would  not  correspond  to  the  specific  characteristics  of 
GMES,  a  complex  system  of  systems  involving  many  partners.  Combinations 
involving G0, which are close to the baseline scenario described in chapter 3.2, are 
therefore discarded. 

Similarly,  all  combinations  involving  the  Option  S0  are  inconsistent.  Generally 
speaking,  the  impacts  of  the  different  governance  options  are  strictly  related  to  the 
sustainability scenarios: in the absence of a programmatic approach beyond research 
no governance option would be beneficial. It is obvious that the third objective of the 
Communication,  namely  to  reassure  stakeholders,  would  not  be  met  if  the 
Community continued to finance GMES on the basis of research projects only. The 
stakeholder consultation has clearly shown that a research environment alone cannot 
provide the stability and confidence necessary to allow for significant investments in 
the  downstream  sector.  Additionally,  it  would  be  inefficient  to  create  specific 
management  structures  if  no  budgets  other  than  research  ones  are  available  for 
GMES,  given  that  the  structures  for  the  management  of  FP  funds  are  in  place 
anyway. Combinations involving option S0 are to a certain extent a variation of the 
baseline and are thus discarded. 

Even though at first sight option G3 could make the programme easier to manage, it 
has also been discarded since: 

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•  GMES is a system of systems, it would therefore not be feasible for political and 
legal  reasons  to  centralise  decision-making  power  that  would  also  concern 
activities financed through national budgets in a single entity. 

•  Option  G3  could  probably  only  be  implemented  through  the  establishment  of  a 
new  intergovernmental  organisation,  which  would  be  extremely  burdensome 
(needing the creation of a large management and technical team) and difficult to 
accept for existing actors. 

•  Option  G3  would  not  be  built  on  existing  structures  and  would  run  the  risk  to 

duplicate what is already exiting and be in direct competition. 

•  This option is also the most difficult to reconcile with the mandate given by the 

Council to build GMES on existing capacities. 

As  a  consequence,  all  combinations  of  options  containing  G3  are  not  taken  into 
account in the impact assessment. 

Finally,  all  combinations  involving  option  G4  have  been  discarded  for  two  main 
reasons. First, the governance framework must respect the role of the Commission as 
defined  in  the  EC  Treaty  and  the  jurisprudence  of  the  European  Court  of  Justice 
concerning the institutional balance within the EC16. Consequently, it is not possible 
that  the  Commission  delegates  the  political  responsibility  for  coordinating  and 
managing the GMES programme to an external entity, such as ESA.  

Additionally, the implementation of GMES goes beyond the technical capacity and 
mandate of ESA. In particular, although ESA is assigned a key coordination role for 
the space component, for political, practical and legal reasons, it cannot be delegated 
the management of the in situ and service components.  

5.4. 

The baseline and combined options 

The baseline scenario described above would correspond to a combination of the no 
change  S0-G0  options.  It  serves  as  the  benchmark  for  the  impacts  of  the  other 
scenarios. 

The  combination  of  options  on  Sustainable  funding  and  Governance  can  be 
summarised as follows and leads to the further analysis of four scenarios, the impacts 
of which have to be assessed with respect to the objectives of the Communication as 
defined above, and in comparison to the baseline. 

G0 

G1 

G2 

G3 

G4 

S0 

S1 

S2 

Base line 

Discarded 

Discarded 

Discarded 

Discarded 

Discarded 

Scenario 1 

Scenario 2 

Discarded 

Discarded 

Discarded 

Scenario 3 

Scenario 4 

Discarded 

Discarded 

16 

See, in particular, the Judgment of the Court of 13 June 1958. - Meroni & Co., Industrie Metallurgiche, 
SpA v High Authority of the European Coal and Steel Community. - Case 9-56. 

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6. 

ANALYSIS OF IMPACTS OF SCENARIOS 

As  outlined  in  Chapter  1  the  object  of  this  Impact  Assessment  is  not  the 
socioeconomic and environmental impact of GMES itself, which will be analysed in 
detail  in  the  Impact  Assessment  concerning  the  Basic  Act  establishing  the  GMES 
programme. Conversely, the present document assesses the impact of options for the 
establishment  of  efficient  governance  and  funding  framework  for  GMES.  The 
following  chapter  therefore  concentrates  on  an  assessment  of  the  impact  of  these 
options in the light of the objectives defined in chapter 4.1. 

6.1. 

Baseline Scenario 

The impact of the baseline scenario is analysed above in chapter 3.2.  

6.2. 

Scenario 1 

Scenario 1 consists of a combination of Options S1 and G1. In this scenario, a GMES 
programme  coordinated  by  a  dedicated  internal  management  structure  would  be 
launched in 2014. A strong role of the Commission in the management of GMES, as 
foreseen in option G1, would fulfil the first objective stated above, as the programme 
would be managed in a stable governance framework. The Stakeholder Consultation 
described  in  more  detail  in  Annex  II  to  this  Impact  Assessment  demonstrated  the 
importance  of  a  robust  programme  management,  particularly  to  ensure  integration 
between  existing  GMES  components,  coherent  management  of  key  programme 
elements,  and  full  involvement  of  all  players.  The  ultimate  responsibility  for 
programme management will therefore be with the Commission, as in the case of the 
European GNSS programmes. Experience with these programmes has shown that an 
outsourcing of programme management tasks (either to a Community agency or an 
external entity outside the EU framework, such as ESA) may limit the capacity of the 
the  programme17. 
Commission 
take  effective  political  responsibility  of 
Nevertheless,  it  is  in  line  with  the  principle  of  sound  financial  management  to 
delegate  technical  implementation  tasks  to  ESA,  which  will  be  responsible  for  the 
coordination  of  the  GMES  space  component,  including  the  development  of  new 
satellites, the procurement of recurrent satellites, the operation of space infrastructure 
and the coordination of access to data from contributing missions. 

to 

The management of the GMES programme should be the task of a specific internal 
management  structure.  Options  for  such  internal  management  structure  include  the 
establishment of a normal Commission unit within a Directorate that takes over the 
tasks of the GMES Bureau, without a decision of the Commission, or a prolongation 
of  the  mandate  of  the  GMES  Bureau.  The  decision  on  the  way  the  tasks  currently 
under  the  responsibility  of  the  GMES  Bureau  will  be  covered  after  May  2009 
depends  on  the  outcome  of  an  independent  evaluation  of  the  GMES  Bureau.  The 
final report of the evaluation will be available at the end of 2008 and is in no way 
prejudged by the present Communication and Impact Assessment. The contract with 
the external evaluator does not provide for Interim Reports.  

17 

In  this  context,  see  also  page  11  of  the  Communication  from  the  Commission  to  the  European 
Parliament  and  the  Council  -  Progressing  Galileo:  Re-Profiling  the  European  GNSS  Programmes  of 
19.9.2007, COM(2007) 534 final. 

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23 

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Regarding  stakeholder  involvement,  the  Commission  could  be  assisted  (i)  by  the 
GMES Partners Board, for the co-ordination of contributions of GMES partners (i.e. 
in  particular  the  Member  States  owning  or  controlling  infrastructure  that  will  be 
made  available  to  GMES),  and  (ii)  a  comitology  committee.  It  is  obvious  that  the 
comitology  committee  cannot  be  set  up  before  the  adoption  of  the  Basic  Act 
establishing  the  GMES  programme.  The  establishment  of  two  separate  bodies 
(GMES  Partners  Board  and  a  comitology  committee)  is  necessary  for  legal  and 
institutional reasons. The comitology commitee will assist in the management of EU 
funds, whereas the GMES Partners Board will coordinate activities that are financed 
not  only  by  EU  funds,  but  also  through  national  or  intergovernmental  funds.  The 
creation  of  one  single  body  both  for  the  management  of  EU  funds  in  line  with  the 
comitology  procedure, and the coordination  of  other  activities  funded  through  non-
EU sources that are managed according to national or intergovernmental governance 
schemes could lead to important institutional difficulties.  

Further, it is likely that under Scenario 1 a dedicated internal Commission structure 
would  delegate  the  technical  implementation  of  the  programme  to  other  entities. 
Within the infrastructure component, 

•  ESA could coordinate the implementation of space infrastructure; 

•  the  European  Environment  Agency  (EEA)  could  coordinate  the  in  situ 

component.18 

Within the service component, in particular the following entities could play a role: 

•  the European Centre for Medium-range Weather Forecasting (ECMWF)19; 

•  Joint Research Centre (JRC); 

•  Eurostat; 

•  the European Environment Agency (EEA); 

•  the European Maritime Safety Agency (EMSA)20; 

•  the European Union Satellite Centre (EUSC); 

•  the European Defence Agency (EDA); 

18 

19 

20 

Some specific coordination activities could be delegated to other existing relevant coordination bodies 
For  instance,  EUMETNET  (the  European  network  of  meteorological  services)  for  meteorological  in-
situ  observation  systems  and  services;  EUROGOOS  (the  European  Association  for  the  Global 
Observing  System);  EUROGEOGRAPHICS  (the  European  association  of  National  Mapping  and 
Cadastral  Agencies)  and  Eurogeosurveys  (the  European  Association  of  Geological  Surveys)  for 
cartography, geology, mapping and reference data; and EMODNET (the European Marine Observation 
and Data Network) for marine data. The EEA should take into consideration research activities of the 
Commission services (including DG INFSO) in the in situ field.  
The ECMWF could be assigned the coordination of the Atmosphere network, in consultation with the 
EEA, which could compile user requirements.  
Both  EDA  and  EMSA  do  not  have  a  competence  in  security  matters,  which  will  be  managed  by 
FRONTEX, EUSC and EDA.   

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24 

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•  European Agency for the Management of Operational Cooperation at the External 

Borders (FRONTEX). 

Regarding user involvement, a risk exists that a delay in the implementation of long-
term governance mechanisms could jeopardize user acceptance before 2014. This is 
because  the  current  ad  hoc  mechanisms  for  compiling  user  requirements,  based  on 
standard rules concerning public consultations organised by the Commission, might 
not be sufficient to guarantee a structured involvement of users in the establishment 
of  their  requirements.  In  this  context,  it  is  to  be  recalled  that  the  ultimate  decision 
concerning user requirements will be with the Commission, which will manage the 
programme  on  behalf  of  the  Community.  A  direct  involvement  of  users  other  than 
Member  States  in  the  adoption  of  formal  decisions  is  difficult  to  implement  in  the 
current legal environment.  

The impacts of option S1 on users and providers of GMES services are more difficult 
to estimate. While operational financing would in the end be present, a gap is left in a 
phase  when  demonstration  would  be  practically  at  its  end.  It  is  possible  that  both 
industry and users could adapt  to a further stretch of the demonstration phase (with 
the positive signals sent by preparatory actions) and accept to wait until 2014 before 
seeing operational financing from the EU. However, there would be a significant risk 
of  losing  support  from  both  sides  if  confidence  is  eroded  in  this  timeframe,  for 
several reasons. First, the Vega study referred to in footnote 5 clearly indicates that 
the Earth observation market in Europe is still dependent to a relatively large extent 
on national, ESA or EC contracts. This means that a lack of EU funding would have 
a negative impact on GMES service providers. Secondly, a delay in the introduction 
of operational services would mean that downstream services would not have access 
to  information  produced  by  GMES  service  providers,  which  could  hamper  the 
development  of  this  sector.  Thirdly,  a  delayed  provision  of  GMES  services  would 
result  in  a  lower  demand  for  data  from  space  and  in  situ  infrastructure.  This  could 
have a negative impact on the sustainability of these infrastructures, which are of key 
importance for the development of the sector according to the OECD. Moreover, one 
would  have  to  consider  a  risk  of  losing  any  first-mover  advantage  internationally 
through  this  delay,  as  emerging  and  established  space  nations  have  shown  signs  of 
following  European  plans  on  their  own  agenda  to  compete  with  Europe. 
Consequently,  it  cannot  be  excluded  that  S1  meets  the  objective  of  reassuring 
stakeholders only in part. 

Finally, it must be asked whether S1 would allow for a timely implementation of the 
governance  and  funding  framework  of  GMES.  As  mentioned  above,  there  is  a  risk 
that even though this Scenario would provide for a stable governance framework, the 
launch  of  the  GMES  programme  in  2014  could  result  in  a  discontinuity  of  some 
services. Consequently, users that have integrated GMES services provided through 
research  projects  in  their  management  procedures  would  face  a  gap  in  the 
information input necessary to fulfil their specific needs. This means that users might 
not  be  willing  any  more  to  use  GMES  services  available  operationally  only  after 
2013. 

6.3. 

Scenario 2 

Scenario  2  corresponds  to  a  combination  of  the  options  S1  and  G2  where  a 
programme  prepared  in  the  context  of  the  next  financial  framework  would  be 

EN 

25 

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managed by an external entity. The main difference between Scenario 1 and 2 lies in 
the way the Commission organises overall programme management and coordination 
of the GMES partnerships. In Scenario 2, management tasks would be outsourced to 
an  external  Community  body,  which  could  be  an  executive  agency  or  a  regulatory 
agency.  Regarding  the  establishment  of  an  executive  agency,  it  would  have  to  be 
assessed whether the extra costs incurred to create a new body would be justified by 
efficiency  gains.  Currently,  it  is  assumed  that  an  externalisation  of  management 
function would not be cost-efficient because it could lead to a duplication of existing 
capacities (in particular the GMES Bureau). 

Alternatively, the Commission could propose the establishment of a new regulatory 
agency or extending the mandate of an already existing one. Nevertheless the current 
Commission  position  is  not  to  propose  the  creation  of  new  agencies  pending  the 
results of the evaluation of existing agencies21. 

Stakeholder involvement would be organised in a way comparable to Scenario 1, i.e. 
through a GMES Partners Board and a comitology committee. Depending on the set 
up  of  the  external  Community  body,  there  could  be  additional  ways  of  involving 
Member States, including an Administrative Board in the event a regulatory agency 
were to be created.  

 In theory, Scenario 2 would therefore meet the first objective referred to in chapter 
4.1.  It  is  assumed,  however,  that  this  Scenario  is  not  cost-efficient,  or  would  be  in 
contradiction with the current community position concerning regulatory agencies. 

6.4. 

Scenario 3  

Scenario  3  consists  of  a  combination  of  options  G1  and  S2.  In  this  scenario,  the 
Commission  would  directly  manage  a  GMES  programme  that  would  already  be 
launched  before  2013.  The  fact  that  the  Commission  takes  strong  political  and 
managerial  control  would  ensure  a  stable  and  transparent  governance  mechanism. 
Furthermore  this  corresponds  to  the  views  of  stakeholders  which  expect  the 
Commission to take the lead for the definition, by the EU, of the overall vision for 
GMES  and  the  extent  of  the  use  of  its  available  instruments  such  as  coordination, 
financing and regulatory measures for the governance of the different components of 
GMES. 

As  in  the  subchapter  concerning  Scenario  1,  the  internal  management  of  the 
Commission  could  be  based  on  the  GMES  Bureau  or  another  specific  internal 
management  structure.  Before  the  adoption  of  the  Basic  Act  establishing  the 
programme, an interim governance structure would be put in place (see 6.2. above). 

Scenario 3 would also allow the Commission to formalise the process leading to the 
establishment of user requirements already in the short to medium run. This is one of 
the  main  expectations  expressed  by  the  user  communities  during  the  consultation 
process. The close involvement of users within a stable mechanism would encourage 
public sector use, which is of key importance according to the OECD study referred 
to  in  chapter  4  of  Annex  3.  Further,  private  users,  including  downstream  service 

21 

See the Communication from the Commission to the European Parliament and the Council, “European 
agencies – the way forward”, COM(2008) 135 final of 11.3.2008. 

EN 

26 

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providers,  will  have  the  possibility  to  contribute  to  the  compilation  of  user 
requirements, thereby ensuring that the information produced by GMES services will 
correspond to their needs.  

Stakeholders contributing in situ or space infrastructure would be part of the GMES 
Partners Board; Member States would be represented in a comitology committee. 

Scenario 3 would have maximum benefits in terms of stabilising the industrial base 
and  also  in  terms  of  involving  users,  as  a  smooth  and  seamless  transition  from 
research  to  operation  would  be  guaranteed.  This  would  also  trigger  maximum 
benefits as compared to other options in terms of stimulating the Earth observation 
downstream sector in a short timeframe, helping to sustain the impressive growth of 
Earth observation markets in Europe22 and encouraging private sector participation, 
as  recommended  by  the  OECD.  This  means  that  Scenario  3  would  fully  meet  the 
third objective referred to in chapter 4.1. above. 

Regarding the fourth objective, the major advantage of this scenario is the timing of 
entry into operation of GMES services, which would allow the EU to reap maximum 
benefits  from  the  environmental  information  coming  from  GMES  (and  where  the 
establishment of trends requires the provision of long, uninterrupted time series), and 
other  users  who  intend  to  continue  using  operational  GMES  services  previously 
provided on a pre-operational basis by research consortia. 

6.5. 

Scenario 4 

Scenario 4 is a combination of options G2 and S2. In this scenario, the Commission 
would  externalise  the  management  of  a  programme  launched  already  before  2013. 
For  the  reasons  already  mentioned  in  the  sub-chapter  covering  Scenario  2,  this 
Scenario does not seem to meet the first objective referred to in chapter 4.1 1 in the 
most efficient way: 

•  An externalisation of management function would not be cost-efficient because it 
could lead to a duplication of existing capacities (in particular the GMES Bureau); 

•  It  would  be  premature  to  propose  the  creation  of  an  external  entity  that  could 

contradict community orientations concerning regulatory agencies. 

7. 

COMPARING THE SCENARIOS 

In  the  table  below,  the  scenarios  assessed  in  chapter  6  (with  the  exception  of  the 
discarded ones as explained above) are compared to the baseline examined in chapter 
3.2. above in the light of the objectives of the Communication. 

Comparison is based on qualitative analysis, which is proportionate to the form and 
content of the Commission Communication (not legally binding) and to the issue at 
stake (not GMES as a whole, but its implementation mechanisms). 

22 

According to the Vega study, European earth observation markets have grown 7 – 8% per annum in the 
last years. 

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27 

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More  detailed  cost-benefit  analyses  will  be  performed  if  necessary  when  the 
Commission  will  propose  a  Basic  Act  establishing  a  GMES  programme,  including 
the relevant budget appropriations. 

Transparent 
and 
sustainable 
governance 
framework 

+ 

+ 

++ 

+ 

Objectives 

Users buy-in 

Stabilisation 
of industrial 
base 
(upstream and 
downstream) 

Feasibility in 
needed 
timeframe 

+ 

+ 

++ 

++ 

- 

- 

++ 

++ 

+ 

-- 

+ 

-- 

Scenario 1 

Scenario 2 

Scenario 3 

Scenario 4 

The  timely  submission  of  a  proposal  for  a  Community  programme  to  ensure 
continuity after the preparatory actions, as foreseen in Scenario 3, seems to best fit 
the Communication objectives and best respond to stakeholders' concerns expressed 
so  far.  Its  combination  with  an  internal  Commission  management  structure  would 
minimise implementation obstacles. 

In Scenario 3, Commission would opt for adopting the necessary proposals in 2009 
and work as closely as possible with the legislator in order to have a final adoption 
by  2011.  This  would  represent  an  important  signal  to  stakeholders,  to  industry  and 
users in particular, that would ease transition to the operational phase and avoid loss 
of confidence. 

Alternatively, postponing the programme to the next financial framework (while also 
avoiding  creation  of  new  external  entities)  would  represent  the  easiest  option  to 
implement (see Scenario 1). However, as explained above, the gap between 2010 and 
2014  represents  an  important  risk  of  losing  stakeholders'  confidence  that  should  be 
carefully managed. 

8. 

MONITORING AND EVALUATION 

The  Communication  itself  will  not  directly result  in  the  financing  of  new  activities 
through  the  EU  budget,  in  addition  to  the  actions  financed  through  FP  7  and  the 
preparatory action. The latter activities are not the object of this impact assessment, 
they will be monitored and evaluated according to standard Commission procedures. 

The  Communication,  however,  contains  a  list  of  actions  that  will  be  carried  out  by 
the  Commission  itself.  For  the  implementation  of  theses  actions,  the  Commission 
will  also  consult  the  GMES  Advisory  Council,  or  its  successor  in  an  interim 
governance framework. An evaluation of the relevance, efficiency and effectiveness 
of the European Commission's GMES Bureau activities was started in July 2008 and 
the  final  report  is  expected  for  January  2009,  in  time  to  feed  any  further  proposals 
implementing this communication. 

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The preparation of the Basic Act establishing the GMES Services will be carried out 
by  the  Commission  itself  in  line  with  applicable  rules.  In  particular,  an  Impact 
Assessment  will  be  prepared,  which  will  contain  an  evaluation  of  the  costs  of  the 
activities  to  be  implemented  either  starting  from  2010/2011  or  2014,  depending  on 
the option chosen. 

The Basic Act establishing the GMES programme will contain detailed provision on 
the monitoring and evaluation of activities financed through the EU budget. 

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29 

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ANNEX I 

REFERENCE STUDIES AND DOCUMENTS 

PriceWaterhouseCoopers, October 2006, Socio-Economic Benefits Analysis of GMES, prepared for 
ESA 
http://www.esa.int/esaLP/SEMJZ10DU8E_LPgmes_0.html 
Impact Assessment of the European Space Policy, including GMES 

http://ec.europa.eu/enterprise/space/off_docs_en.html  

GOSIS study (funded under FP6) on GMES governance models 
http://ec.europa.eu/enterprise/space_research/pdf/gosis.pdf 
SEIS Impact Assessment: Towards a Shared Environmental Information System (SEIS) 

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52008SC0112:EN:HTML 
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2008:0046:FIN:EN:PDF 
http://eurlex.europa.eu/Notice.do?val=464212:cs&lang=en&list=464212:cs,&pos=1&page=1&nbl=1
&pgs=10&hwords=&checktexte=checkbox&visu=#texte 

Impact  Assessment  relating  to  the  Economic  and  Governance  Evolution  of  Space  in  Europe,  RPA 
February 2007, prepared for EC DG Enterprise & Industry 

http://ec.europa.eu/enterprise/calls/files/08_004/rpa_study.pdf 

European  Commission  Green  Paper,  European  Space  Policy,  COM(2003)17  final  (21.1.2003)  - 
http://eur-lex.europa.eu/LexUriServ/site/en/com/2003/com2003_0017en01.pdf 
European  Commission  White  Paper  Space:  a  new  European  frontier  for  an  expanding  Union: 
An action  plan  for  implementing  the  European  Space  policy,  COM(2003)673  (11  November  2003) 
http://ec.europa.eu/comm/space/whitepaper/whitepaper/whitepaper_en.html 
European Commission 'European Space Policy - Preliminary Elements' COM(2005) 208 final 
(23.May 2005) 
http://ec.europa.eu/enterprise/space/doc_pdf/pep.pdf 
SPASEC March 2005: Report of the panel of experts on space and security, prepared for EC DG 
Enterprise & Industry 
http://ec.europa.eu/comm/space/news/article_2262.pdf 
ECORYS / ESYS 2006: SATMAC – Satellite Communication Market Assessment and Cost Benefit -, 
Market Characterisation Report and Satellite Communication Application and Services, prepared for 
EC DG Enterprise & Industry 
http://ec.europa.eu/enterprise/space/doc_pdf/impact_assessment_en.pdf 
BICEPS report - Building an Information Capacity for Environmental Protection and Security 
(European Commission, DG RTD, 2004) 
http://www.gmes.info/library/index.php?&direction=0&order=&directory=6.%20Cross-
Cutting%20Studies%20Documents 
DPAG  report  -  Data  Policy  Assessment  for  GMES  (European  Commission  DG  RTD)  - 
http://www.gmes.info/library/index.php?&direction=0&order=&directory=6.%20Cross-
Cutting%20Studies%20Documents 
INSPIRE  Extended 
http://inspire.jrc.it/reports/inspire_extended_impact_assessment.pdf 

–  European  Commission, 

Impact  Analysis 

SEC(2004)980 

– 

http://inspire.jrc.it/reports/AANSDI_Italy_FinalApproved_v12en.pdf 

Costs for monitoring and reporting 
GINIE  (10/2003):  Geographic  Information  in  the  Wider  Europe,  DG-INFSO  Contract  IST-2000-
29493 
http://www.ec-gis.org/ginie/doc/ginie_book.pdf 

EN 

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PIRA (09/2000): Commercial Exploitation of Europe’s Public Sector Information © European 
Communities, 2000 
ftp://ftp.cordis.europa.eu/pub/econtent/docs/2000_1558_en.pdf 
Craglia M and J. Nowak (2006): “Assessing the Impacts of Spatial Data Infrastructures - Report of the 
International Workshop on the Cost to Benefit and Return on Investment Ratios of SDIs”. 2006, Ispra, 
Italy 
http://www.ec-gis.org/sdi/ws/costbenefit2006/reports/report_sdi_crossbenefit%20.pdf  
European  KNOWLEDGE  INTENSIVE  Services  based  on  Earth  Observation:  “Doing  business  with 
the help of GMES” by S.Galant, T.Pagano, A.Vaféas, TECHNOFI, October 2007 (copy available) 
Geospatial Interoperability Return on Investment Study, National Aeronautics and Space 
Administration (NASA): Geospatial Interoperability Office, April, 2005. 
http://www.ec-gis.org/sdi/ws/costbenefit2006/reference/ROI_Study.pdf 
OECD Environmental outlook to 2003 

http://www.oecd.org/dataoecd/29/33/40200582.pdf 

OECD(2005): Space 2030 – “Tackling society’s challenges” 
http://www.oecd.org/document/13/0,2340,en_2649_34815_35059341_1_1_1_1,00.html 
Space for GeoInformation, The Netherlands (02/2003) 
http://www.ravi.nl/ruimte/index.htm 
MICUS (01/2003): The market for geospatial information: potential for employment, innovation and 
added value, study for the Germen government 
http://www.micus.de/pdf/micus_study_broadband.pdf 
P.Weiss (NOAA, 02/2002): Borders in Cyberspace – conflicting public sector information policies and 
their economic impacts (for the EU/US comparison) 
http://www.weather.gov/sp/Borders_report.pdf 
Environmental Performance Index 2008, Yale and Columbia, http://epi.yale.edu/Home  
Euroconsult 2007, Assessment of the downstream value-adding sectors of space-based applications 
VEGA and Booz Allen and Hamilton, 2004, The state and health of the European and Canadian EO 
service industry 
VEGA, 2008, The state and health of the European and Canadian EO service industry in 2006 
ECORYS,  2008,  Study  on  the  competitiveness  of  the  GMES  Downstream  Sector,  prepared  for  DG 
Enterprise and Industry 

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ANNEX II 

RESULTS OF THE STAKEHOLDER CONSULTATION 

Introduction 

In 200423 the Commission underlined the strategic role of GMES, identified elements 
for its implementation and the next year defined the strategy to move from concept to 
reality  notably  through  a  phased  implementation  approach24.  The  Space  Council 
supported this approach and at the same time stressed the need for a consolidation of 
the overall GMES architecture, and the identification of appropriate governance and 
financing schemes. 

In 2006, the Commission set up the GMES Bureau to strengthen the management of 
GMES.  The  Bureau  is  tasked  to  prepare,  in  close  coordination  with  the  relevant 
stakeholders and users, the Commission proposals and requirements on GMES. 

The following chapters provide a synthesis of the input received by the Commission 
in  the  last  two  years  from  expert  groups,  stakeholders  and  Member  States,  and 
highlight  the  consensus  achieved  on  the  main  issues  where  it  is  necessary  to  act  to 
ensure an operational implementation of GMES. 

Towards an Operational EU GMES Programme 

So far, GMES has been a European initiative that has drawn political attention to the 
need to preserve and strengthen service and infrastructure elements. Substantial R&D 
effort has been invested by the EU, ESA and their respective Member States. In the 
future, it is considered that GMES should be the product of a series of partnerships 
that need to be defined at the EU level, taking into consideration the role of agencies, 
Member  States,  value  added  services  industry  (including  SME’s)  and  user 
communities. 

The variety of partnerships, infrastructure and services involved in GMES is linked 
with  the  areas  of  interest  of  the  different  partners,  notably  Member  States. 
Consequently,  in  the  operational  phase  of  GMES,  this  should  be  reflected  in  the 
programmatic, management and financing schemes. 

As  a  user-driven  initiative,  GMES  should  be  designed  in  such  a  way  that  there  is 
continuous  user  uptake  through  constant  consultation  with  users  and  integration  of 
their changing needs in an iterative process. 

Financial  and  programmatic  schemes  should  be  designed  to  guarantee  long-term 
sustainability  of  GMES  and  the  efficient management  of  Community  funds,  and  to 
support scientific and technical service evolution. 

23 

24 

Global  Monitoring  for  Environment  and Security (GMES):  Establishing  a  GMES  capacity  by  2008  – 
Action Plan 2004-2008 (COM (2004) 65 Final). 
Global Monitoring for Environment and Security (GMES): from concept to reality (COM (2005) 565 
Final). 

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8.1. 

Definition of the EU GMES Programme 

Following various Council Orientations and Resolutions, the EU has been assigned a 
leading role in the development of GMES, with ESA being the implementing agency 
for its space observation component. The roles of all actors need to be consolidated. 
It  is  imperative  that  the  EU  defines  the  overall  vision  for  GMES  and  uses  its 
available instruments such as coordination, financing and regulatory measures for the 
governance  of 
the  different  components  of  GMES.  Those  financial  and 
programmatic  instruments  should  guarantee  a  long-term  sustainability  of  services 
and infrastructure. 

Building on existing operational activities, previous and current R&D activities and 
the  Preparatory  Action,  the  GMES  programme  should  contain  a  definition  of  its 
overall  objectives  and  the  areas  where  EU  action  is  required,  and  indicative 
budgetary  resources.  It  should  have  a  clear  scoping  complementing  the  actions  at 
national  and  intergovernmental  levels  and  ensuring  the  user  driven  character  of 
GMES. 

The  GMES  architecture  consists  of  several  individual  components.  Each  of  these 
components  has  its  own  characteristics  in  terms  of  ownership,  facilities,  decision-
making  process,  financing  model, industrial and economic set-up and management. 
Where  lacking,  dedicated  governance  mechanisms  should  be  implemented  for  each 
of  these  GMES  components  taking  into  account  existing  and  future  technical  and 
institutional specific characteristics and structures. 

The  overall  governance  scheme  will  aim  at  establishing  a  sustainable  institutional 
and  financial  framework  for  GMES  and  integrating  GMES  actors  with  a  view  to 
establishing genuine partnerships. It should allow for the interaction of the individual 
GMES components and their associated sub-governance schemes, and should ensure 
the  efficient  management  of  Community  funds  allocated  to  the  programme,  the 
management of necessary contractual relations for the operation of GMES, and legal 
international  communities  and 
representation 
coordination bodies, including the Group on Earth Observations (GEO). 

towards  external  actors  and 

Within the overall governance of the programme, mechanisms able to bring together 
actors  of  different  institutional  nature  should  be  defined,  ensuring  a  proper 
representation of the EU Member States. The specific issue of countries who are not 
members of the EU and who are involved in the implementation of GMES has to be 
addressed in this context. 

Key issues raised by Stakeholders 

•  Ensuring that the EU and its Member States have the level of engagement and incentive to 
commit to the long-term availability of institutional observation and service infrastructure 
and resources for GMES. 

•  The  EU  GMES  Programme  should  be  defined  in  such  a  way  that  it  adequately 
complements existing financing and programmatic schemes, thereby becoming a decisive 
factor  for  the  establishment  of  a  partnership  between  the  EU  and  national  and 
intergovernmental actors. 

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•  Decision-making should be streamlined with clear roles and responsibilities involving all 
different actors, and especially funding bodies, and putting users at the forefront. The role 
of mandated bodies in this process is particularly important. The process at the operational 
phase  should  be  transparent  and  binding  on  reaching  consensus  and  on  implementing 
decisions including the evolution of GMES. 

•  To ensure transition to a governance system for an operational GMES architecture, robust 
programme  management  is  needed,  particularly  to  ensure  integration  between  existing 
GMES  components,  coherent  management  of  key  programme  elements,  and  full 
involvement of all players. 

•  User communities should be involved in governance and management at overarching and 
component  level,  so  as  to  promote  a  continuing  dialogue  between  the  entities  defining 
user  requirements,  observation  and  service  infrastructure  and  service  operators,  and  the 
bodies deciding on the future evolution and funding of GMES. 

8.2. 

Funding 

GMES is essentially a shared and distributed system and therefore it is expected to 
be co-financed at European, intergovernmental and national levels. 

The costs of GMES during its operational phase depend on the scope of the services, 
the  consolidated  cost  of  the  observation  infrastructure  needed  to  provide  these 
services, and the extension of the international cooperation. 

The share of the EU budget in the overall amount will depend on the scope for the 
activities funded and managed at EU level. According to the additionality principle, 
the  EU  contribution  will  not  replace  existing  and  planned  national  investments  but 
will rather complement them in order to ensure a long-term sustainability for GMES. 
There is a need for continuity of EU R&D budgets as well as for the establishment of 
new budgets at EU level to support the operations of GMES. 

Key issues raised by Stakeholders 

•  Preparing  an  operational  funding  line  in  the  European  Union  budget  by  2014  while 
ensuring  the  phased  operational  implementation  of  GMES  in  line  with  Space  Council 
orientations at the same timeframe. 

•  Taking the necessary steps to expand the preparatory operational budget line introduced in 
2008  in  order  to  cover  expenses  required  for  the  finalisation  of  the  build-up  and  early 
operation of GMES services and the GMES observation component. 

•  The long-term GMES funding approach should ensure a smooth transition between three 
stages  that  partly  overlap:  demonstration  stage  to  be  funded  from  R&D  appropriations, 
pre-operational  stage  with  mixed  R&D  and  operational  funding,  operational  stage  with 
operational  funding  from  EU  and  national  operational  budgets,  bearing  in  mind  that 
demonstration  activities  and  future  operational  elements  will  continue  to  require  R&D 
funding during the operational stage. 

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8.3. 

The Downstream Sector 

GMES  has  been  selected  as  one  of  the  quick  start  projects  in  the  Commission’s 
Initiative for Growth25. It should stimulate the industrial sector to expand its service 
offer  and  to  develop  the  innovative  integration  of  observing,  communications  and 
information  technologies  that  will  create  opportunities  for  increased  private  sector 
usage  of  information  sources.  The  European  industrial  base  will  be  an  important 
asset in maintaining a European autonomous capacity and political independence in 
decision making. 

The  stimulation  of  the  downstream  sector  should  also  be  facilitated  by  the 
mobilisation  of  traditional  EU  instruments  in  support  of  competitiveness  and 
innovation.  Full,  equal  and  open  access  to  GMES  data  and  information  will 
contribute to the Lisbon growth and job strategy and preserve the competitive market 
in the value adding sector. 

Key issues raised by Stakeholders 

•  The GMES data and information policy should be based on the principle of “full and open 
access” to the extent allowed by the overall financial model and other legal and security-
related constraints. 

•  Structured user support measures, with special focus on capacity building for shared needs 

among different Member States and for different application sectors. 

•  Structured business support measures with special focus on small and medium enterprises 

should stimulate growth and job creation. 

•  In  order  to  support  the  continued  development  of  innovative  services,  primarily  in  the 

downstream sector, R&D funds must continue to be made available. 

8.4. 

International Cooperation 

Although  European  autonomy  for  GMES  services  is  of  key  importance,  the  EU 
recognises that international cooperation in Earth Observation is imperative to fulfill 
the need for information based on global in-situ and remote sensing data. This cannot 
be  pursued  without  exchanging  equivalent  observation  data  through  cooperation 
schemes,  thereby  sharing  the  burden  and  cost  of  an  expensive  observation 
infrastructure with major non-European partners. 

Further, only a coordinated approach bringing together the main actors in the world 
can  lead  to  efficient  counteraction  facing  global  threats.  The  joint  development  of 
shared  or  complementary  Earth  observation  tools  has  led  the  major  actors  in  the 
world to recognise the reality and criticality of the on-going climate change process. 

International  cooperation  should,  when  appropriate  and  efficient,  build  on  existing 
cooperation  schemes  developed  by  European  national  and  intergovernmental  actors 
with international counterparts. 

25 

“A  European  initiative  for  growth:  Investing  in  networks  and  knowledge  for  growth  and  jobs:  Final 
report to the European Council” COM(2003) 690 final/2 (21.11.2003) 

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Among those is the GEO process. GMES will be the main European contribution to 
the global 10-year implementation plan for the Global Earth Observation System of 
Systems  (GEOSS).  By  registering  GMES  components  in  the  GEOSS,  GMES  will 
contribute to increasing the knowledge of the Earth processes, enhance the prediction 
of the Earth systems, and will encourage the increased use of Earth observation, the 
development of a system of worldwide observation systems, and collaborative tools 
for observation and analysis with international partners. 

Key issues raised by Stakeholders 

The strategy regarding possibilities of international cooperation linked to GMES should be 
built along the following lines: 

•  Balanced cooperation on observation infrastructure that does not compromise the GMES 
objective  for  European  autonomy  in  information  generation,  access  and  control  and 
technological capacity in key areas;  

•  R&D cooperation to prepare the future and foster interoperability; 

•  Cooperation,  in  line  with  EU  external  relations  policies,  especially  for  contributing  to 
sustainable  development,  as  well  as  for  European  solidarity  and  capacity  building 
approach including for instance support to food security, humanitarian aid, management 
of emergencies and crises. 

•  Strengthening the existing political mandate to support a co-ordinated European approach 
within  the  current  development  of  the  GEO  process  to  implement  the  GEOSS  data 
sharing principles and to define the European contribution to this international endeavour. 

Implementing GMES: consolidated views and open issues per component 

Following the wide consultation notably through the GMES Advisory Council and in 
accordance  with  the  Munich  Roadmap,  there  is  now  a  shared  vision  on  the  scope, 
architecture,  and  governance  principles  for  GMES.  The  following  sections 
summarise,  starting  from  the  existing  stakeholders’  consensus  where  available,  the 
main  issues  raised  by  Stakeholders  and  linked  to  the  different  components  of  the 
GMES architecture. 

8.5. 

The GMES Service Component 

Through  its  service  component,  GMES  will  ensure  regular  observation  and 
monitoring  of  the  sub-systems  of  the  Earth–  including  its  atmosphere,  oceans  and 
continental surfaces – and will provide reliable, validated information in support of a 
broad range of environmental and security applications and decisions. According the 
current analysis of the user needs, the scoping of these services is as follows: 

•  Land monitoring 

The Land Monitoring Core Service (LMCS) addresses a wide range of resources and policies 
(concerning  soils,  water,  agriculture,  forestry,  biodiversity,  transport,  regional  development 
etc.) involving very diverse user communities at global, European, national, regional and local 
level,  requiring  different  types  of  information,  from  common  multi-purpose  up  to  specific 
information in terms of thematic or geographical area. 

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The  LMCS  will  offer  a  portfolio  of  data  and  products,  with  different  levels  of  elaboration 
(from pre-processed images to elaborated information), finding a compromise between multi-
purpose  requirements  and  specific  thematic  requirements,  that  are  important  for  addressing 
European policies and for land management support. 

Multi-purpose  products  will  include  pre-processed  spaceborne  and  airborne  observation 
products,  specific  reference  data  complementing  existing  reference  data  (e.g.  European 
Digital  Elevation  Model),  bio-geophysical  parameters  (dynamic  vegetation  and  surface 
parameters in real-time at global level); a set of land use / land cover and land cover change 
products. 

Thematic products at European or global levels such as crop forecasts, agricultural statistics, 
water  models  (quality,  irrigation),  environmental  indicators,  carbon  fluxes,  soil  degradation 
and  desertification  models,  urban  and  industrial  areas  and  hot  spots,  will  address  more 
specific thematic requirements. 

•  Marine 

The  objective  of  the  Marine  Core  Service  (MCS)  is  to  establish  an  integrated  European 
capacity  for  ocean  forecasting  and  monitoring  allowing  a  systematic  delivery  of  forecasts 
(from  one  day  nowcasting  to  one  month  seasonal  forecasting),  re-analysis  (time  series)  and 
scenario simulations (for climate change impact assessments): 

–  on sea state and dynamics (e.g. 3D currents, temperature, salinity) and primary ecosystem 

(surface phytoplankton and primary production) characteristics; and 

–  at global scale (all world ocean) with daily updates on 5-10 km horizontal grids and over 
European regional seas (Baltic, Mediterranean, North Sea, North East Atlantic Basin), with 
daily updates at customised space resolution (1-5 km horizontal grids). 

As oceanographic models form the basis of its global and regional forecast services, the MCS 
depends  on  observation  data  from  space  and  in-situ  infrastructure  and  weather  analysis  and 
forecast information from numerical weather prediction models. Thematic Assembly Centres 
will  be  responsible  for  specific  pre-processing  of  different  parameters  to  be  used  as 
observation  time-series  and  input  to  the  global  and  regional  Monitoring  and  Forecasting 
Centres.  Regional  models  are  foreseen  for  the  Baltic,  Mediterranean,  Black  Seas,  Arctic 
Ocean, Northwest Shelf and the North Atlantic. 

•  Atmosphere 

The GMES Atmosphere Core Service (GACS)  provides products for three main application 
areas: (i) air quality, including long range transport of pollution, (ii) climate forcing and (iii) 
stratospheric ozone, UV and solar radiation. These products cover short term (including near 
real-time) to long term information needs (especially through reanalysis). 

The  atmospheric  service  will  fill  existing  gaps  in  accessible  information  on  atmospheric 
chemistry and composition. This will include: 

–  provision  of  Global  Climate  Observing  System  (GCOS)  Essential  Climate  Variables 

(ECV's) compliant with Global Climate Observing System (GCOS) requirements; 

–  gridded information on atmospheric composition; 

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–  long-term databases in order to clearly establish trends;  

–  reanalysis at regular intervals; 

–  ensuring  effective  access  to  in-situ  and  satellite  observation  data,  including  in  near  real 

time for services, e.g. in the field of solar energy; 

–  forecasting  and  assessment  capabilities  for  policy  development,  health  and  other 

applications. 

•  Emergency management 

The  objective  is  to  deliver  a  set  of  basic  services  to  improve  the  capability  of  users  to  face 
major emergencies at national, European and global levels either within or outside Europe. It 
will  cover  information  relating  to  natural  disasters  including  meteorological-driven  hazards 
(e.g.  storms,  fires,  floods),  geophysical  hazards  (e.g.  earthquakes,  tsunamis,  volcanic 
eruptions, landslides and subsidence), and man made disasters and humanitarian emergencies. 

The initial scope of the GMES Emergency Response Core Service (ERCS) is to provide rapid 
mapping  services,  delivering  reference  maps  and  assessment  maps  with  a  synthetic 
representation  of  anomalous  events,  their  impact  following  effects  and  their  time  and  space 
evolution,  as  well  as  the  distribution  in  space  and  time  of  the  available  resources  (rescue 
teams,  equipment,  material  etc.),  assets,  and  the  actual  damage.  The  ERCS  will  expand 
beyond the emergency response part of the crisis cycle and evolve to cover the entire crisis 
cycle  (crisis  prevention,  early  warning,  post-crisis  reconstruction  and  situation  assessment). 
The  products  will  be  diversified  (mapping  services,  forecasts  and  early  warning  systems, 
scenario preparation). 

•  Security 

Preliminary discussions with different stakeholders have shown that security users should be 
offered the same rights as other user users of GMES services bearing in mind that GMES is a 
civil system under civil control. Experienced security actors underlined the sensitivity linked 
to the acquisition, handling and dissemination of geospatial information. Security users have 
specific needs which justify the creation of specific services. 

In  order  for  GMES  services,  data  and  information,  to  be  used  for  public  decision-making, 
most particularly but not solely for what concerns security-related services, they should fulfill 
basic security criteria in terms of confidentiality, anonymity, traceability as well as security of 
infrastructure  and  processes.  These  requirements  will  need  to  be  considered  by  GMES 
services in general without hindering their overall development. 

With  the  aim  to  raise  stakeholder's  awareness  and  to  obtain  guidance  for  scoping  and 
implementation,  the  EU  Institute  for  Security  Studies  held  a  seminar  on  the  security 
dimension  of  GMES  in  March  2007.  The  discussions  at  the  seminar  identified  a  number  of 
areas  where  GMES  could  have  a  relevant  role  to  play  in  facilitating  monitoring  or 
implementation  of  policies,  including  e.g.  maritime  and  border  surveillance  and  global 
situation  awareness.  Following  the  coordination  between  the  Commission  and  the  General 
Secretariat of the Council, a number of action areas meeting policy requirements have been 
identified  including:  border  surveillance,  maritime  surveillance  and  support  to  EU  external 
action. 

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The specific support of GMES to security applications as well as the importance of correctly 
addressing  security  of  information  produced  by  GMES  is  currently  being  elaborated  by  the 
Commission. The results of ongoing analyses will be communicated at a later stage. 

Key issues raised by Stakeholders 

•  Ensure in the definition of the initial scope for GMES services that their deliverables meet 

user needs (including the needs of downstream sector). 

•  Establish  a  mechanism  for  approval  and  continuous  management  of  user  feedback  and 

requirements as well as for the validation of their implementation. 

•  Appropriate balance among coordination, financing and regulatory actions by the EU. 

•  Establish operational financing sources and associated procurement policy. 

8.6. 

The GMES Space Component 

The  GMES  Space  Component  (KSC)  shall  ensure  sustainable  provision  of  satellite 
derived  Earth  observation  data  to  the  GMES  service  component.  The  KSC 
architecture is driven by and derived from service requirements provided by the user 
communities represented in the overall GMES governance scheme. This requires that 
any  investment  in  the  space  component  needs  to  correspond  to  user  requirements 
aggregated by the Commission. 

The  GSC  is  subject  to  a  space  infrastructure  mission  lifecycle  which  is  driven  by 
service  requirements  and  which  determines  the  roles  and  responsibilities  of  the 
various actors, funding sources and decision-making process. This lifecycle includes 
the following stages: 

•  demonstration  stage  through  missions  or  technologies  implemented  with  R&D 

funding;  

•  pre-operational stage with initial elements of an operational series through a mix 

of R&D and operational funding; and  

•  operational stage with recurrent elements of an operational series26. 

Stakeholders agree that the main challenge today is to ensure the implementation of 
the  second  and  third  stages  mentioned  above.  This  is  true  for  a  major  part  of  KSC 
missions, including the ESA Sentinels and most of the national missions in Europe. 

The  current  situation  presents  gaps  and  cannot  guarantee  the  availability  and 
continuity  of  the  whole  GSC  mission  range  and  mission  lifecycle  described  above. 
The availability of GSC missions covering the third stage of lifecycle, i.e. recurrent 
elements of operational series, should be specifically considered. This would imply 
organising different funding and associated procurement policies. 

26 

For instance, regarding the Sentinel missions, the recurrent units are defined as those units that follow 
after  the  completion  of  the  full  operational  capability.  In  addition,  it  is  essential  that  also  during  the 
operational  stage  R&D  elements  are  implemented,  e.g.  for  the  development  of  the  next  generation 
Sentinels, which will incur the need for R&D funds. 

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Moreover, it is clear that at least four major functional roles are required, including 
coordination  of  infrastructure  availability,  procurement  and  operations  of  the 
operational infrastructure, and R&D for future infrastructure. These functions need to 
be  further  developed  or  created  for  sustaining  an  operational  European  capacity  as 
shown in the following paragraphs. While the operation of national assets will clearly 
remain  in  the  hands  of  respective  national  and  commercial  operators,  the 
EUMETSAT  and  ESA  capacities  will  be  operated  by  European  public  entities  that 
have  the  appropriate  mandate  and  are  technically  capable  of  providing  such 
operational services. 

There  is  need  to  identify  a  decision-making  process  which  brings  together  all 
relevant GMES Space Component partners in Europe. This process should build on 
the distributed architecture of the GMES Space Component. It should start with the 
definition  and  prioritisation  of  GMES  service  requirements  through  the  general 
GMES  governance  scheme.  Subsequently,  these  service  requirements  should  be 
translated  into  mission  and  architecture  requirements  taking  into  consideration 
the  available  resources  and  plans  for  Earth  Observation  space 
especially 
infrastructure. ESA, as coordinator of this GMES component, should then develop an 
implementation  plan  to  be  steered  and  approved  by  the  general  GMES  governance 
which  will  allocate  its  resources,  if  necessary  with  prioritisation  decisions.  At  this 
stage,  the  GMES  Space  Component  partners  coordinated  by  ESA  should  then 
proceed  with  the  implementation  following  the  most  appropriate  programmatic 
scheme. 

The  decision-making  process  should  take  into  consideration  the  implementation 
process, including decision making and funding, of individual partners. Nevertheless, 
there  is  a  need  to  establish  a  process  linking  the  various  partners  enabling  to  reach 
consensus and to drive the implementation (including financing) process. 

Regarding  financing,  as  the  GSC  capacities  gradually  reach  the  third  stage  of  the 
operational  lifecycle  (i.e.  recurrent  elements  of  operational  series),  one  major  issue 
linked  to  the  long-term  continuity  of  the  GSC  is  the  availability  of  operational 
funding sources, notably the possibility to establish operational funding from the EU 
budget completing future operational funding sources at national level. 

The  precise  content  and  costing  of  the  GSC  will  drive  the  establishment  of  new 
operational  budgets.  Such 
long-term 
implementation plans for the GMES Space Component to be elaborated by ESA with 
EUMETSAT, Member States and other stakeholders. This process is expected to be 
finalised  by  2009  to  allow  the  Commission  to  fulfil  its  commitment  to  prepare 
proposals on the necessary EU operational budget. 

issues  are  carefully  examined 

the 

in 

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Key issues raised by Stakeholders 

•  Ensure that the KSC corresponds to the requirements of GMES services 

•  Ensure an overall programmatic approach for a full mission lifecycle with special focus 

on a sustainable approach for recurrent elements of operational series. 

•  Identify  how  Member  States  can  contribute  to  the  GMES  Space  Component  with  their 

national missions and how the continuity of these missions can be ensured. 

•  Finalise content and costing of the GSC through overall consensus of the long-term KSC 

implementation plans to be coordinated by ESA. 

•  Identify  the  steps  towards  the  establishment  of  operating  entities  and  the  definition  of 

their role. 

•  Establish decision-making processes within the GMES Space Component and identify its 

involvement in the GMES overall governance. 

•  Establish  operational  financing  sources  and  the  associated  industrial  policy  for 

infrastructure and data. 

8.7. 

The In-situ Component  

The in-situ observation component is based on an observation infrastructure owned 
and operated to a large degree by the Member States, in some cases coordinated in 
the  frame  of  European  or  international  networks.  In-situ  observation  activities  and 
associated  infrastructure  derive  from  a  range  of  national,  EU  and  international 
regulatory  requirements  and  agreements  or  form  part  of  research  processes.  None 
were  created  to  meet  the  needs  of  GMES,  and  they  generally  cover  a  much  wider 
field than the requirements of GMES services. In-situ data flows, and products, are 
often inconsistent between different collection bodies, incomplete, not well-adapted 
to GMES service needs (e.g. for near real time data), subject to usage conditions that 
can affect their ready availability, and dependent on research funding. They therefore 
do not have the necessary operational sustainability. 

In-situ  observation  data  provide  data  not  available  from  space  sources  (e.g.  in  the 
marine  area,  data  from  submersible  floats)  or  essential  reference  data  (e.g. 
topographic maps), and could also be used for calibration of space data or validation 
of space-based derived parameters. 

The existing observation infrastructure is subject to a complex pattern of ownership 
and  management,  responds  to  a  range  of  national,  EU  and  international  regulatory 
requirements  and  from  numerous  research  processes.  Many  national,  European  and 
international  networks  coordinate  monitoring  and  the  analysis  and  consolidation  of 
data. 

In-situ observation data flows are highly fragmented; there are significant gaps in the 
data;  there  are  inconsistencies  between  data  collected  by  different  bodies;  and 

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systems  are  not  well  adapted  to  GMES  service  needs  (e.g.  for  near  real  time 
observation requirements in some cases). 

Each service Implementation Group (IG) has produced its own list of essential in-situ 
data  flows.  This  process  has  demonstrated  wide  differences  between 
the 
requirements  of  the  services.  Given  the  complexity  of  the  in-situ  observation 
component,  the  European  Environment  Agency  (EEA)  has  been  tasked  by  the 
Commission  to  analyse  and  coordinate  the  in-situ  observation  data  requirements  of 
GMES. 

Discussion among stakeholders of how to realise these requirements has brought to 
the surface a number of issues, including: 

•  concerns  that  Member  States  might  not  in  practice,  and  for  various  reasons,  be 
able or willing to guarantee the provision of in-situ observation input and that EU 
funding might need to be considered; 

•  a  need  for more  clarity  about what environmental  communities might gain from 
GMES services in return for the provision of input, particularly as in practice their 
interest would often be in downstream services; 

•  what some regard as lack of transparency in the development of the initiative so 

far, and inadequate engagement of national authorities; 

•  the importance of quality control for input data for services. 

A  service-driven  approach  based  on  the  evolving  GMES  Services  needs  to  be 
followed.  This  will  require  close  engagement  with  bodies  in  Member  States  and 
international  and  European  coordinating  bodies,  which  are  key  players  in  the 
management of data provision; global in-situ observation networks; and channels of 
user focus, especially in ensuring that data and products delivered by GMES services 
to  which  they  contribute  genuinely  meet  their  needs  –  including  for  downstream 
services. 

The  financial  responsibility  for  most  in-situ  observation  data  gathering  and 
management  is  outside  the  EU  framework,  and  GMES  should  not  change  this.  But 
funding  issues  for  new  elements  may  need  to  be  addressed  in  the  framework  of 
GMES funding. 

Key issues raised by Stakeholders 

•  Reviewing organisational structures and ensuring adequate engagement of environmental 

bodies as both providers of data and products, and users of services. 

•  Identifying  possible  instruments  of  coordination,  regulation  or  funding,  shared  between 

the EU and Member States, to facilitate the provision of in-situ input. 

•  Identification  of  content  and  costs  of  GMES  in-situ  observation  component  through 
overall  consensus  on  the  medium  and  long  term  scenarios  under  the  coordination  of 
relevant European institutions. 

•  Identification  and  co-ordination  of  the  European  approach  on  global  in-situ  observation 

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networks. 

•  Contributing  to  the  continuity  of  data  provision  and  a  mechanism  for  assessing  data 

quality. 

8.8. 

GMES Data and Information Policy and data management 

The  complex  GMES  architecture  includes data  and  information  flowing  among  the 
different components and from/to sources outside the GMES perimeter. In particular, 
the  observation  infrastructure  component  produces  and  delivers  data  of  various 
processing levels and sources. Data from this component are regularly processed by 
the  GMES  Service  component  (in  this  case,  there  is  a  flow  of  data  between  the 
components) in order to generate information made available to users, including the 
downstream sector. 

Due  to  the  complexity  of  an  operational  GMES  architecture,  a  two-step  process 
should be envisaged for elaborating a GMES data and information policy, based on 
(i)  the  definition  of  objectives  and  principles  of  a  GMES  Data  Policy,  and  (ii)  the 
implementation of these objectives and principles.  

The principles of the GMES data policy are to promote the widest possible use and 
sharing  of  GMES  data,  to  strengthen  markets  using  Earth  Observation  (and 
especially the European downstream sector) and consequently to enable growth and 
job  creation,  to  contribute  to  the  sustainability  of  the  provision  of  GMES  data,  to 
ensure adequate protection of GMES data, and to support the European public sector, 
including  its  research  communities.  An  objective  should  then  be  that  GMES  data 
should therefore be fully and openly accessible, within the constraints and exceptions 
(e.g. security issues) deriving from the overall GMES legal and policy environment. 
This principle is not only compliant with the INSPIRE rules and in accordance with 
the GEOSS Data Sharing Principles, but also targets the objective of promoting the 
widest possible use and sharing of GMES data. 

GMES data are provided in a complex legal and financial environment. Data flows 
will be subject to binding rules at national, Community and international level. The 
detailed  implementation  mechanisms  for  a  GMES  data  and  information  policy  will 
not  only  depend  on  these  legal  constraints,  but  also  on  the  governance  framework 
and financing model for the GMES Service in question. 

Key issues raised by Stakeholders 

•  Achieve  consensus  on  the  high-level  objectives  and  principles  for  GMES  data  and 

information policy and the related financial model. 

•  Identify ways to implement data policy objectives and principles. 

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ANNEX III 

GMES SOCIETAL BENEFITS AND INDUSTRIAL IMPACT 

Background 

The  socio-economic  benefits  of  GMES  and  the  expected  impact  on  the  related 
European industry sectors have been comprehensively characterised and documented 
in a series of independent studies conducted over the period 1995-2008. 

The prime purpose of GMES is to provide information to support public policy. As 
such  the  GMES  information  services  are  a  public  good.  From  the  available  data,  it 
seems  reasonable  to  assume  that  the  benefits  resulting  from  GMES  significantly 
exceed the associated costs for its development and operations. 

Public  sector  investment  to  ensure  the  availability  and  operations  of  a  Europeean 
autonomous global observing capability is a pre-requisite to achieving the long term 
societal benefits and facilitating the progressive participation of the private sector. 

This annex provides an overview of studies conducted on societal benefits of GMES 
and  assessments  of  related  industrial  sectors  and  commercial  markets  at  European 
and global levels. 

Two analyses of the benefits and impacts expected to result from GMES have been 
conducted;  the  “GMES  Socio-Economic  Study”,  commissioned  by  EC  was 
completed  by  ESYS  in  2003,  and  the  “GMES  Socio-economic  Benefits  Analysis” 
commissioned  by  ESA,  was  completed  by  PriceWaterhouseCoopers  in  2006.  The 
analysis by PWC incorporated the results of 12 smaller scale cost-benefit analyses of 
individual services from the ESA GMES Services Elements (2002-2005). Both these 
studies  concluded  that  GMES  information  products  are  public  goods,  i.e.  the  same 
information products can be used and reused by many different stakeholders to serve 
a wide range of public policies, and identified significant benefits from GMES. 

The major benefit of GMES was identified as avoided costs. A more effective policy 
regime,  using  improved  and  up-to-date  information  from  GMES,  will  avoid  costs 
that  would  otherwise  be  incurred  as  a  consequence  of  less  well-informed  decision 
making.  In  both studies, impact was assessed with respect to a no-GMES  scenario. 
Thus  benefits  uniquely  dependent  upon  GMES  were  identified.  The  no-GMES 
scenario was based on the BICEPS report, commissioned by the EC in 2003, which 
documents  the  technical  baseline  scenario  for  environmental  monitoring  within 
Europe. 

Societal Benefits 

The value of GMES information as a support to public policy decisions depends on 
several factors, such as: (i) the cost implications of a policy decision, (ii) the quality 
of  information  that  is  already  available  and  (iii)  the  capacity  of  governments  to 
exploit  better  information.  Thus  GMES  information  is  of  greatest  value  for  policy 
sectors  which  are  affected  by  high  uncertainty  associated  with  geospatial  or 
environmental  conditions,  significant  cost  implications,  and  a  lack  of  alternative 
information. For example, several of the Millennium Ecosystem Reports specifically 

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cite  lack  of  such  information  as  a  major  constraint  for  effective  policy  in  domains 
such  as  deforestation,  desertification  and  wetlands  management.  Most  recently,  the 
IPCC 4th Assessment Report identified gaps in climate observations over developing 
countries as an obstacle to effective policies on climate change. 

The  approach  being  taken  in  the  on-going  study  of  GEOSS  societal  benefits  is 
consistent  with  the  GMES  socio-economic  benefits  studies.  The  GEOSS  analysis 
also  assesses  benefits  and  impacts  in  terms  of  societal  outcomes  enabled  by  better 
informed decisions. 

Major GMES benefits in the following EU policy domains were identified: 

•  Europe  as  a  global  player  (climate  change  adaptation,  global  environment 

protection, humanitarian response); 

•  preservation  and  management  of  natural  resources  (air  quality,  marine 

environment, forest ecosystem management, civil protection); and 

•  sustainable growth (efficient delivery of public services). 

Significant  benefits  were  also  identified  in  areas  such  as  climate  change  mitigation 
and development aid (with respect to Europe as a global partner) and urban and rural 
policy,  agriculture  policy,  water  quality,  management  of  wetlands  (with  respect  to 
preservation and management of natural resources). However, an already established 
and  widely  accepted  method  for  quantifying  the  economic  value  of  these  benefits 
was not available. 

The benefits were grouped into three categories in order to provide insight into the 
timescales,  external  dependencies  and  uncertainties  involved  in  realizing  these 
benefits: 

•  efficiencies  in  implementing  existing  policies.  These  benefits  could  be  realized 

almost immediately; 

•  European  policy  formulation  benefits.  Since  they  depend  on  future  policy 

evolution, these benefits would accrue later, typically one decade hence; 

•  global action benefits: Since they depend on new international policy agreements, 
these benefits would accrue later again. Similarly, the external dependencies and 
uncertainties  in  their  realization  are  greater.  However,  by  virtue  of  their  global 
scope, they hold the greatest potential benefits. 

Industry and Markets 

In  addition  to  these  socio-economic  benefits,  GMES  will  support  the  goals  of  the 
Lisbon Agenda of building a competitive knowledge based European economy. This 
concerns several industrial sectors within Europe, in particular but not only the space 
industry. At a global level OECD has, since 2004, been conducting an analysis of the 
global space economy. Input to this analysis came from the “Global Forum on Space 
Economics” set up in 2006, and the results (“The Space Economy at a Glance”) were 
published in 2007. 

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OECD has estimated multipliers which characterise the direct impact of investment 
in the space manufacturing industry on OECD economies. In a cited case study, the 
US  Department  of  Commerce  estimated  that  in  2004,  the  US  space  sector  was 
responsible  for  more  than  US$  98  B  in  economic  activity,  i.e.  approximately  three 
times the space budget at that time. At present the satellite manufacturing turnover in 
Europe  is  approximately  €5  B  per  annum.  The  planned  annual  investments  in  the 
GMES  Space  Component  represent  less  than  8%  of  this  and  can  be  expected  to 
deliver  benefits  to  the  European  economy  with  comparable  multiplier  effects.  In 
addition  to  the  economic  multipliers,  investment  in  space  also  creates  benefits  via 
directs sales spin-offs. A second OECD case study demonstrates that these can be 4 
to 5 times the value of the initial investment. Most recently the UK Case for Space 
analysis  identified  broader  economic  considerations  such  as  the  impact  on  job 
creation  and  the  higher  level  of  economic  return  achieved  from  investment  in  the 
space sector. 

At  the  downstream  level,  the  relevant  GMES  sector  can  be  defined  as  those 
organisations that offer value added services based on Earth Observation (EO) data, 
but  also  large  industrial  sectors  which  integrate  information  derived  from  Earth 
observation in their service offer or production processes, according to the model of 
meteorological  or  geographical  information.  Within  the  downstream  sector,  two 
distinctions should be made: 

•  Companies  that  use  EO  data  and  derived  information,  the  provision  and 
availability  of  which  would  be  affected  by  the  introduction  of  GMES  services, 
versus those that use other EO data; 

•  Public entities versus private actors. 

The  economic  performance  of  the  GMES  downstream  sector  has  been  reported  in 
three  studies:  a  study  by  Euroconsult  in  200727,  and  two  studies  by  VEGA,  from 
200428 and updated in 200829. 

Euroconsult  assessed 
the  downstream  value-adding  sectors  of  space-based 
applications. This concerned earth observation (EO), communication and navigation. 
An overview of the world and European revenues and the compound annual growth 
rate (CAGR) is provided in the following table. 

Sector 

World revenues 
2005 

European revenues 
2005 

Europe % 

2000-2005 CAGR 
Europe 

Telecom 

€54.3 billion 

€18.1 billion 

Navigation 

€17.3 billion 

€2.3 billion 

Earth observation 

€1.3 billion 

€0.4 billion 

Total 

€72.9 billion 

€20.8 billion 

33% 

13% 

31% 

29% 

6.5% 

22% 

4% 

11% 

27 
28 

29 

Euroconsult, 2007, Assessment of the downstream value-adding sectors of space-based applications. 
VEGA  and  Booz  Allen  and  Hamilton,  2004,  The  state  and  health  of  the  European  and  Canadian  EO 
service industry 
VEGA, 2008, The state and health of the European and Canadian EO service industry in 2006 

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Table 1: Revenues of the downstream value adding sectors of space-based applications for 
2005. Source: Euroconsult (2007). European data include Canada, an associate member of 
ESA, which accounts for around 10%. 

The table indicates that EO is the smallest of the three value adding space segments 
in absolute numbers. European revenues take up around one-third of world revenues. 
European  revenues  from  EO  amount  to  approximately  2%  of  total  European 
revenues of downstream value adding sectors, which is equal the share that world EO 
revenues have in world value-adding revenues. 

The  revenue  figures  above  are  for  EO  value  adding  activity  undertaken  on  a 
contracted  basis  including  public  sector  revenues,  which  account  for  around  €150 
million,  mostly  coming  from  Meteorology  and  Met-ocean.  European  data  quoted 
above include Canada, an associate member of ESA, which accounts for around 10% 
of  the  total.  The  following  table  provides  as  split  of  total  European  revenues  per 
segment, and additionally provides the growth rate in the period 2000-2005. 

Segment 

Meteorology 

Defence and security 

Oceanography 

Natural Resource Monitoring 

Land Monitoring 

Total  

Revenue in 2005 

CAGR 2000-2005 

€ 211 million 

€ 65 million 

€ 49 million 

€ 52 million 

€ 13 million 

€ 390 million 

2% 

5% 

10% 

2% 

2% 

4% 

Table 2. European revenues EO value adding industry per segment in 2005. Source: 
Euroconsult (2007). European data include Canada, an associate member of ESA, which 
accounts for around 10%. 

Euroconsult also indicated that EO value adding industry is the only segment where, 
in  commercial  activity,  the  downstream  sector  is  smaller  than  the  upstream  sector 
(Satellites, launches, operations and ground equipment). 

The  Euroconsult  figures  as  mentioned  above  can  be  compared  with  the  figures 
provided by VEGA. VEGA reports the total revenue in Europe and Canada for EO 
value adding industry at € 285 in 2002, growing 2% per annum on average to € 306 
million in 2006. This figure does not entirely match with the € 390 million in 2005, 
as presented by Euroconsult. However, these revenues include public sector revenues 
from  meteorology  and  met-ocean,  while  we  understand  that  this  is  excluded  in  the 
VEGA study. If we correct for this, there is a ‘gap’ of around € 60 million. Part of 
this can be explained by the difference in base year (2005 for Euroconsult, and 2006 
for VEGA), but not all. The discrepancy may arise from methodological differences. 

VEGA  indicates  that  about  30%  of  all  revenues  are  from  National/ESA/EC  grants, 
hence  not  from  customers  paying  for  services.  This  figure  rises  to  50%  for 
small/medium sized companies. 

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VEGA  estimates  employment  in  the  sector  to  have  risen  from  2,900  employees  in 
2002 to 3,000 in 2006.An overview of employment and revenue is presented in the 
following table. 

Revenue* 

Employees* 

Labour productivity (revenue per 
employee) 

2002 

2006 

CAGR 

€ 285 million 

€ 306 million 

1.8% 

2,900 
€ 98,000 30 

3,000 

€ 102,000 

0.85% 

0.93% 

Table 3. European revenue and employment. Source: VEGA. *Does not include revenue or 
employment generated by the public sector 

The table indicates that revenues have increased by around 2% per annum on average 
between  2002  and  2006,  while  employment  evolved  in  a  lower  pace,  slight  under 
1%. This implies that the productivity per employee has grown. 

These figures from both Euroconsult and VEGA are for all EO activity, even if the 
company concerned is not in the “space sector”. Hence they include, for example, the 
EO related revenues of large engineering /survey companies that use EO as part of 
their  overall  business.  VEGA  also  estimated  that  the  value  adding  products  and 
services  provided  by  the  EO  value  adding  industry  are  made  up  for  80%  from  a 
combination of spaceborne plus aerial or ground data. The OECD31 indicates that in 
the  total  EO  downstream  sector  (commercial  remote  sensing,  including  data  sales), 
the revenues amounted to € 2 billion worldwid e (satellite plus aerial component) in 
2003. It was estimated that the satellite component amounted to one third of the total. 

Conclusion 

The  GMES  direct  downstream  sector  employs  around  3,000  persons  in  2006.  The  total 
revenue in Europe amounts to € 250 - 300 million in 2006, excluding revenues by the public 
sector,  which  amount  around  €  150  million.  These  values  include  revenues  from  grants; 
corrected for this, revenues from paying customers amount to € 175 -210 million, excluding 
revenues by the public sector. 

According to VEGA, there are 151 companies in Europe and Canada which can be 
defined as value adding companies (2006), excluding the public sector. In 2002 there 
were  162  companies  identified.  The  decrease  can  be  explained  by  consolidation 
activities that have taken place. 

The  sector  is  primarily  made  up  of  small  and  medium  sized  companies.  The 
distribution among categories is presented in the following table. 

30 

31 

VEGA reports revenue per employee being € 107,000, which is based on a correction for outliers in the 
survey sample. However, these outliers were not excluded when calculating total revenue, which does 
not seem methodologically sound. Therefore this table presents the ‘raw’ figures without correction for 
outliers. 
Space 2030, Tackling society’s challenges, OECD, 2005 

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Size class 

Small (0-10 employees) 

Medium (11-60 employees) 

Large (>60 employees) 

Total 

Number of companies 

87 

68 

6 

151 

Table 4. Size distribution of value adding companies (Europe and Canada). Source: VEGA 

On average, the sector employs 20 persons per company and generates a turnover of 
around  €  2  million  per  company.  VEGA  not es  that  profitability  is  highly 
concentrated with 89% of the profits coming from just 5 companies. VEGA indicates 
that  the  main  operational  centres  of  EO  activity  are  in  the  UK  and  Germany,  with 
France, Italy and Spain also making a significant contribution. 

Conclusion 

The  GMES  downstream  sector  is  a  relatively  small  sector,  composed  of  around  150 
companies. More than half of these companies are small companies employing less than 10 
persons.  The  average  turnover  amounts  to  €  2  million  per  company.  Note  that  the  public 
sector is not included in these figures. 

The  use  of  GMES  information  in  large  industrial  sectors  such  as  energy,  agriculture,  water 
resources, etc  should be comparable  to those of  similar  information  such  as  meteorology  or 
cartography and remains to be assessed. 

VEGA  indicates  that  about  30%  of  all  revenues  of  the  EO  value  adding  sector  is 
from  National/ESA/EC  grants,  hence  not  from  customers  paying  for  services.  This 
figure rises to 50% for small/medium sized companies. 

The European EO value adding sector takes up around one-third of global revenues. 
Both  the  below  revenue  and  non  weighted  revenue  tables  give  a  picture  of  the 
geographical market reach of companies. The graph indicates that the majority of the 
users or customers of European value adding companies are located in the country of 
the  company  itself.  The  revenue  weighted  analysis  shows  that  where  there  are 
activities  outside  Europe,  the  market  is  dominated  by  the  activities  of  large 
companies operating in Asia and North America according to VEGA. 

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Figure : User locations for EO companies. Source: VEGA 

Overall,  nearly  10%  of  all  European  products  are  also  sold  to  global  users  (VEGA 
2008). Historical comparisons of growth in EO Services by customer location shows 
that in the period 2003 – 2006 there was a growth in products sold globally. 

In terms of the profitability trend of the EO service industry as a whole, profitability 
is typically below 10% and concentrated in a few larger companies, with only 89% 
of profit value across the sample companies from the VEGA survey (VEGA 2008) 
being  delivered  by  five  organisations.  In  2006,  a  significant  profit  (greater  than  1 
million Euros) is limited to just five companies in the research sample32, including all 
the large respondents and just one medium sized organisation. 

Whilst it is not directly related to profitability, the current ratio33 of the industry has 
been analysed in the literature. Whilst the trend is upwards in the EO value adding 
industry,  many  companies remain below the ‘safe’ level of 1 (for the current ratio) 
and  the  industry  remains  below  benchmarks.  For  example,  current  ratios  for 
engineering companies in the EU are 1.5 and in the US 1.1, while the EO industry as 
a whole is 0.89. (Galant 2007). 

Despite issues with funding relating to support from the public institutions34, the EO 
sector  shows  above  average  investment  in  R&D  compared  with  other  sectors,  with 
the average R&D expenditure accounting for 27.5% of EO revenue. It is important to 

32 

33 

34 

Source: VEGA (2008). It should be noted that profitability of EO companies is shown by this study to 
be typically presented in low single figures as percentage of revenue, variable between companies and 
volatile year on year. 
An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more 
liquid the company is. Current ratio is equal to current assets divided by current liabilities. 
Issues  being  that  revenues  are  primarily  generated  from  operational  services  but  revenues  grants  still 
comprise  about  a  quarter  of  company  revenues  on  average  (VEGA  2008).  Organisations  awarding 
grants  to  the  EO  sector  included  National  public  grants,  European  public  grants  -  ESA  EC  &  other 
(VEGA 2008) 

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note  that  technical  development  activities  in  the  EO  sector  are  funded  by  clients  / 
public funds and not direct by internal investment (VEGA 2008). 

GMES  aims  at  the  delivery  of  information  services.  At  the  global  level,  a  recent 
study  of  total  revenues  for  meteorology,  airborne  and  satellite  remote  sensing 
estimated global revenues of the order US$ 7B for 2007 rising to approximately US$ 
10B in 2012. These figures include the larger airborne remote sensing data market. 
Concentrating  only  on  EO,  the  projected  growth  is  approximately  8%  per  annum. 
These estimates are consistent with an independent study by Euroconsult as well as 
related studies of the market for Geographic Information Systems. 

Since  1995,  total  revenue  of  the  European  and  Canadian  EO  service  industry  has 
been regularly assessed by a series of independent studies commissioned by both EC 
and  ESA.  Three  snapshots  of  annual  revenues  within  the  industry  (including  both 
R&D grants and commercial sales) were compiled in 1995, 1998 and 2001 followed 
by  two  detailed  assessments  of  the  state  and  health  of  the  EO  service  industry  in 
2004  and  most  recently  in  2007.  These  studies  show  a  consistent  picture  –  Europe 
earns between 33% and 50% of the global commercial market for EO based services 
and  this  market  is  growing  at  approximately  7  –  8  %  per  annum.  The  most  recent 
assessment estimates total European and Canadian EO service revenue (not including 
data sales) as approximately €306 M for 2006. In addition, combined data sales and 
ground station procurement revenues were estimated to be approximately €106M. 

Historic evolution of total revenue in the European EO service industry – source ESYS and 
Vega 

In  comparison,  the  global  commercial  revenues  in  the  much  larger  satellite 
telecommunications  and  navigation  service  sectors  are  estimated  at  approximately 
US$ 55 B per annum and US$ 21 B per annum respectively. 

Relevance for GMES implementation 

As  well  as  assessing  the  space  economy,  OECD  has  also  formulated  a  set  of 
recommendations  on  emerging  economic  sectors,  including  the  space  sector.  These 
recommendations  are  of  direct  relevance  to  GMES.  In  particular,  the  context  cited 
for  economic  value  to  be  delivered  from  space  is  centred  on  a  set  of  key  societal 
needs  and  challenges  including  environmental,  managing  natural  resources  and 
agriculture, security,  mobility  and  challenges  related  to  the  move  to  the  knowledge 
society. 

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OECD  recognises  that  the  financial  sustainability  of  operational  space  systems 
delivering public good services remains a key challenge. Thus the recommendations, 
listed  below,  concern  the  role  of  government  in  strengthening  the  contribution  of 
space in the context of global societal challenges: 

•  Implement a sustainable space infrastructure: 

Implement a sustainable user oriented space infrastructure 

Develop and maintain cost-efficient space transport and servicing infrastructure 

•  Encourage public sector use: 

Encourage public sector use at national level, including creation of mechanisms for 
the  effective  generation  and  use  of  space  based  data  and  strengthening  cooperation 
between user ministries and space agencies 

Encourage  public  sector  use  at  international  level,  including  encouragement  of  the 
use  of  space  applications  for  global  disaster  prevention,  treaty  monitoring  and 
fostering social and economic development 

•  Encourage private sector participation: 

Create a supportive legal and regulatory environment for commercial activities 

Strengthen private provision of space based goods and services, including fostering 
of  public  procurement  from  the  private  sector  and  privatization  of  commercially 
viable business oriented government activities 

•  Foster a more supportive international business and finance environment 

to 

initiated  prior 

the  OECD  analysis, 

the  GMES 
Although  GMES  was 
implementation  strategy  closely  matches  the  independent  OECD  recommendations. 
At present a sustainable GMES space observation infrastructure is being built up by 
sustaining existing missions and developing new missions (e.g. the ESA Sentinels). 
The requirements for the Space Component are based on documented needs of public 
sector users derived from long term EU policy goals. Public sector usage of GMES 
(space  and  in-situ  observation  and  service  components)  is  being  fostered  by  the 
implementation of dedicated GMES services. Specific mechanisms to ensure service 
to  users  at  international  and  national  level  are  being  put  in  place.  Over  the  next  5 
years, GMES implementation will progress from the present pre-operational services 
and  preliminary  space  component  to  a  fully  operational  service  capability  with  the 
launch  of  the  first  dedicated  Sentinel  mission  in  2012.  Thereafter,  long-term 
sustainability of public sector usage and realisation of the socio-economic benefits is 
contingent on the establishment of stable governance and funding scheme for GMES 
operations.  This  will  encourage  private  sector  participation  by  establishing  stable 
conditions within which industry and commercial operators can undertake their own 
independent initiatives and investments. 

The  conditions  under  which  GMES  observations  and  core  services  will  be  made 
available to users and service providers are an important factor in the encouragement 
of both public sector use and private sector participation. The PWC reports highlights 

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that an inappropriate access policy for GMES data and services would inhibit public 
sector  use  and  private  sector  initiatives,  and  thus  limit  the  realisation  of  socio-
economic  benefits.  Several  studies  have  demonstrated  that  an  effective  means  to 
maximize public use and private sector development is to ensure free access to the 
basic  observation  data  and  some  basic  services  via  public  funding.  The  economic 
benefits of such a policy were documented in a 1998 study which compared US and 
EU data access policies, and assessed the associated economic impacts. A 2001 study 
by  KPMG demonstrated that  free data access offered by US Government  Agencies 
resulted  in  greater  public  sector  utilisation  and  higher  resulting  economic  activity 
than  in  comparable  economies  that  implemented  a  policy  of  cost  recovery  via  data 
sales. 

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ANNEX IV 

POLITICAL FRAMEWORK FOR GMES AND STEPS AHEAD 

The  Global  Monitoring  for  Environment  and  Security  (GMES)  initiative  was  launched  in 
1998  through  the  Baveno  Manifesto35  signed  by  a  number  of  European  space  agencies,  the 
Commission, ESA and EUMETSAT. In its Resolution of 16 November 2000 on a European 
space strategy (2000/C 371/02) Council noted “the importance of satellite data in managing 
the  environment  and  regional  planning,  in  safeguarding  human  life  by  managing  the 
consequences of disasters, in monitoring risks and in improving civil security, and noting the 
need  to  develop,  without  delay,  operational  or  pre-operational  application  services,”  and 
called on “the  Commission, together with the ESA  and  the  Member  States,  to  complete  the 
outline  for  this  initiative,  starting  from  the  needs  of  users  and  civil  society,  so  that  specific 
implementing proposals can be drawn up by the end of June 2001”. 

In  its  Communication  entitled  “Global  Monitoring  for  Environment  and  Security  (GMES)  - 
Outline  GMES  EC  Action  Plan  -  (Initial  Period:  2001  –  2003)  of  23.10.2001,  COM(2001) 
609  final  reiterated  the  objective  of  to  develop  operational  systems  and  services  by  2008, 
making  reference  to  Commission  Staff  Working  Paper  -  Joint  document  from  the  European 
Commission services and European Space Agency36. Following this Communication, Council 
adopted  the  Resolution  of  13  November  2001  on  the  launch  of  the  initial  period  of  global 
monitoring for environment and security (GMES), in which it was mentioned that the Council 
“URGES  the  Commission  to  start,  in  close  coordination  with  the  ESA,  the  initial  period  of 
global monitoring for environment and security (GMES), […] STRESSES the importance of 
the initial period in preparing the next phase of GMES…". 

After  the  end  of  the  initial  period  of  GMES,  the  Commission  adopted  the  Communication 
entitled  “Global  Monitoring  for  Environment  and  Security  (GMES):  Establishing  a  GMES 
capacity  by  2008  -  (Action  Plan  (2004-2008))”  of  3.2.2004,  COM  (2004)  65  final.  The 
Communication underlined that “from the experience gained during the initial period, there is 
significant  support  to  justify  the  further  development  of  the  GMES,  the  objective  being  to 
achieve a “core capacity”, i.e. the initial set of services and the supporting components needed 
to  deliver  these  services  on  an  operational  basis  by  2008.  The  capacity  is  to  be  built-up 
gradually,  based  on  clearly  identified  priorities  and  by  using  existing  elements  wherever 
possible.” This approach was supported by the European Parliament37. 

In 
its  Communication  entitled  “Global  Monitoring  for  Environment  and  Security 
(GMES):From  Concept  to  Reality”  of  10.11.2005,  COM(2005)  565  final,  the  Commission 
reiterated that the he command of information on environment and security has geostrategic 
implications, referring to the above mentioned to the  political mandate expressed at the June 
2001 Gothenburg summit and in the later Council Resolution (see above)  towards “achieving 
by 2008 an operational and autonomous European capability”. Further, it was recalled that the 

35  

36  
37  

The  initial  name  of  the  initiative  stated  in  the  Baveno  Manifesto  was  Global  Monitoring  for 
Environmental Security. 
SEC(2001) 993 of 16/06/2001. 
B5-0045/2004 European Parliament resolution on the action plan for implementing the European space 
policy. 

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second  Space  Council  has  confirmed  that  GMES  will  be  the  second  EU  flagship  of  space 
policy after Galileo. 

In  the  orientations  of  the  second  Space  Council,  it  was  recalled  that  the  EU  will  focus  on 
space-based applications to contribute to the achievement of its policies, particularly Galileo 
and  Global  Monitoring  for  Environment  and  Security  (GMES).  The  Third  Space  Council 
reaffirmed  “the  strategic  dimension  of  GMES,  which  should  be  user-driven  and  service-
oriented, meeting initially public sector needs through services delivered in the most efficient 
way  ,  where  possible  by  the  private  sector;”  and  supported  “a  phased  approach  for  the 
implementation of GMES based on clearly identified priorities, starting with the development 
of three fast-track services on Emergency Response, Land Monitoring, and Marine Services 
due  to  begin  their  pilot  phase  as  operational  services  by  2008,  with  other  services  to  be 
developed and validated in due time…” 

In  its  Resolution  of  21  May  2007  on  the  European  Space  Policy38,  the  Space  Council 
recognized the strategic value of sustainability for GMES and reaffirmed the objective for an 
operational and autonomous capability for GMES before the end of 2008. it was emphasised 
that  the  European  Commission  needs  to  propose  for  GMES  in  due  time  and  after  full 
consultation with Member States and ESA, arrangements for: 

(i) financing, including facilitation of funding by the users, 
(ii) operational infrastructures, and 
(iii) effective management — to become fully operational and to ensure sustainable services 
responding to identified user needs, 

Finally, in its Resolution of 26 September 2008 entitled “Taking forward the European Space 
Policy”,  the  Space  Council  identified  the  need  to  elaborate  an  action  plan  leading  to  the 
setting-up of an EU GMES programme, aiming at securing the continuity of GMES services 
and of the critical observation data which they require. This action plan should include: 

•  an approach for the overall GMES governance; 
•  a  plan  for  sustainable  funding  of  GMES,  based  on  an  assessment  of  the  overall 
financing needs for GMES and the definition of the budgetary strategy at national and 
European levels; 
the definition of operational service delivery mechanisms for each GMES service; 
the definition between the EU and Member States of a process to formalise their 
commitments to contribute to GMES through existing in-situ observation and service 
infrastructures; 

• 
• 

•  τhe identification of the role of the GEO initiative and other intergovernmental or 
•  multilateral initiatives, such as CEOS, in accessing the whole range of data available, 

as 

•  well as the contribution of GMES to these international endeavours; 
•  a process to establish a comprehensive data policy for all data generated by the GMES 

system. 

The Space Council of 26 September 2008 also welcomed the intention of the Commission to 
address  all  of  these  issues  in  a  Communication  to  be  adopted  by  the  end  of  October  2008, 

38  

2007/C 136/01. 

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having  consulted  with  the  main  stakeholders,  in  particular  agreeing  with  ESA  an  overall 
programmatic approach for the GMES Space Component.  

The  details  of  the  action  plan,  which  contains  all  the  major  steps  to  be  taken,  will  be 
elaborated in the course of 2009. Further, it is envisaged that in 2009, the Commission will 
propose  a  Basic  Act  concerning  a  “bridge  financing”  of  operational  activities  in  the  period 
2011  –  2013,  accompanied  by  a  detailed  assessment  of  the  costs  and  the  impact  of  such 
activities. The funding of activities in the next financial perspective, starting in 2014, will be 
covered by an additional Basic Act to be adopted before the end of 2013.  

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