COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS EU SPACE INDUSTRIAL POLICY RELEASING THE POTENTIAL FOR ECONOMIC GROWTH IN THE SPACE SECTOR
Date: 2013-02-28
Institutions: European Commission
Subjects: European Space Agency, aerospace industry, competitiveness, economic growth, job creation, new technology, space navigation, space research, technological independence

EUROPEAN 
COMMISSION 

Brussels, 28.2.2013  
COM(2013) 108 final 

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

EU SPACE INDUSTRIAL POLICY 

RELEASING THE POTENTIAL FOR ECONOMIC GROWTH IN THE SPACE 
SECTOR 

EN 

   EN 

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

EU SPACE INDUSTRIAL POLICY 

RELEASING THE POTENTIAL FOR ECONOMIC GROWTH IN THE SPACE 
SECTOR 

EN 

2 

   EN 

 
 
 
1. 

A  STRATEGIC  INDUSTRY  WHICH  WILL  CONTRIBUTE  TO  THE  EUROPE  2020 
STRATEGY

Space  is  more  than  a  technological  issue.  It  always  had  and  will  continue  to  have  a  strong 
political  dimension  which  has  not  been  developed  properly  at  European  level  so  far.  The 
European  Space  Agency  (ESA)  has  been  conceived  as  an  inter-governmental  research  and 
development  agency  allowing  Europe  to  develop  some  unique  scientific  and  technological 
capacities and placing it at face level with the leading space-faring nations in the world. But 
ESA is not a political actor. Over the past decades, the political dimension of space has been 
driven by national policies of those countries most active in space in Europe. However, with 
increasing  competition  from  new  emerging  space-faring  nations  their  individual  political 
weights  may  no  longer  suffice  to  address  the  challenges  ahead.  An  EU  space  policy  could 
reinforce  the  European  identity  at  international  political  level.  At  the  same  time,  EU 
intervention could give space a stronger political impetus, for example by putting in place the 
right framework conditions to maintain and foster space activities in Europe and its industry's 
competitiveness at global level. This is where article 189 TFEU, which gives the EU a clear 
mandate to intervene in space matters, could make a difference.  

Space  is  at  the  service  of  the  European  citizens.  Many  of  the  systems  and  services  that  are 
today essential for our well-being and security depend directly or indirectly on space. Without 
being  aware  of  it,  European  citizens  rely  on  space  technologies  when  they  use  their  mobile 
phones, do financial transactions, take an airplane, watch the weather forecast or look for the 
nearest restaurant in their cars. Space has become part of our daily live. 

Space is a driver for growth and innovation, and contributes directly to the objectives of the 
European  2020  Strategy,  Europe's  growth  strategy  for  a  smart,  sustainable  and  inclusive 
economy1.  The  space  sector  is  both  a  driver  to  scientific  progress  and  enables  systems  and 
services  with  growth  potential  in  areas  such  as  telecommunications,  navigation  and  Earth 
observation.  These  systems  and  services  guarantee  independence  and  security  for  the  EU. 
They help us  to address major societal challenges such as climate change, scarce  resources, 
health,  or  the  ageing  of  our  population.  They  provide  us  with  strategically  important 
knowledge underpinning the EU’s external relations in areas such as development-assistance 
and humanitarian aid. They stimulate innovation and competitiveness well beyond the space 
sector, and contribute to economic growth and job creation in almost all economic areas.  

In  December  2008,  the  European  Council  highlighted  the  potential  of  space  to  impact  on 
innovation and economic recovery. In May 2009, the 6th Space Council emphasized "the need 
to mobilise existing innovation support mechanisms at European, national and regional level, 
and consider new support instruments to ensure cross-fertilisation of knowledge, innovation 
and  ideas  between  space  and  non-space  sectors,  and  between  space  industry  and  leading 
research organisations and universities". 

Following  the  adoption  of  its  Innovation  Union  flagship  initiative,  the  Commission  has  put 
forward its proposal for the Horizon 2020 programme under the next Multiannual Financial 
Framework which encompasses research and innovation. Out of the proposed 80 billion Euro, 
1.7 billion Euro are to be invested in space research and innovation. 

Furthermore,  space  has  become  a  global  business.  The  European  space  industry  has  to  face 
increasing  competition  from  new  emerging  space  powers  such  as  China  and  India.  EU 

1 

"EUROPE 2020 A strategy for smart, sustainable and inclusive growth" COM (2010) 2020 

EN 

3 

   EN 

 
 
                                                 
intervention in space, together with those of its Member States and the ESA, needs to aim at 
strengthening the European space industry's competitiveness at global level. 

The  strategic  importance  and  the  specificities  of  this  global  industry  call  for  a  dedicated 
approach  to  industrial  policy  which  is  driven  by  the  need  to  ensure  cost-efficiency  and 
competitiveness at global level, while ensuring steady consolidation and development of state 
of the art skills and competences and reaffirming a strong commitment with economic growth 
in  line  with  the  Europe  2020  strategy.  The  Commission  underlined  its  intention  to  pursue  a 
space industrial policy developed in cooperation with ESA and the EU Member States in its 
Communication  on  EU  industrial  policy  adopted  in  October  20102.  In  April  2011,  the 
Communication  entitled  “Towards  a  space  strategy  for  the  European  Union  that  benefits  its 
citizens”3  gave  further  orientations  of  a  potential  European  space  industrial  policy.  Member 
States  supported  this  approach  in  the  Council  conclusions  adopted  in  May  and  December 
20114. 

This  Communication  builds  also  on  the  Commission's  Industrial  Policy  Communication 
(COM(2012)  582  final)  for  A  Stronger  European  Industry  for  Growth  and  Economic 
Recovery5. 

Against this background, the EU's space industrial policy should be centred on five specific 
objectives: 

1.  Establish a coherent and stable regulatory framework 

2.  Further  develop a competitive,  solid, efficient and balanced industrial base in Europe 

and support SME participation; 

3.  Support the global competitiveness of the EU space industry by encouraging the sector 

to become more cost-efficient along the value chain; 

4.  Develop markets for space applications and services; 

5.  Ensure technological non-dependence and an independent access to space. 

Regarding  the  last  objective,  it  is  of  fundamental  importance  that  the  EU  maintains  its 
autonomy  in  strategic  areas  of  the  space  sector  such  as  the  launch  services.  The  EU  space 
industrial  policy  should,  therefore,  ensure  the  availability  of  a  reliable,  secure  and  cost-
efficient launcher system. It should create the conditions (including the financial conditions) 
necessary  to  maintain  and  strengthen  independent  European  access  to  space  in  line  with 

2 
3 
4 

5 

COM(2010)614 
COM(2011)152 
Council  Resolution:  “Orientations  concerning  added  value  and  benefits  of  space  for  the  security  of 
European citizens”, 18232/11, Brussels, 6 December 2011 which concluded "that industrial policy for 
space should take into account the specificities of the space sector and the interest of all Member States 
to invest in space assets, and aim at the following common objectives: support the European capability 
to  conceive,  develop,  launch,  operate  and  exploit  space  systems;  strengthen  the  competitiveness  of 
European industry for both its domestic and export markets; and promote competition and a balanced 
development  and  involvement  of  capacities  within  Europe".  It  also  underlined  "the  need  to  examine 
whether appropriate measures may be necessary at European and international level to guarantee the 
sustainability  and  economic  development  of  space  activities,  including  those  of  the  European 
commercial sector". 
COM(2012) 582 final, Communication from the Commission to the European Parliament, the Council, 
the  European  Economic  and  Social  Committee  and  the  Committee  of  the  Regions,  Brussels, 
10.10.2012. 

EN 

4 

   EN 

 
                                                 
institutional needs. To this end, the governance of the exploitation of the European launchers 
should  evolve  to  increase  financial  efficiency  in  the  management  of  user  programmes. 
Ultimately,  the  actors  of  the  European  space  policy  will  have  to  develop  a  real  European 
launcher policy which exists in most space-faring nations. 

An EU space industrial policy can only be effective if based on efficient cooperation between 
the  three  actors  of  the  European  space  policy:  the  EU,  ESA  and  their  respective  Member 
States.  The  TFEU  states  that  the  EU  may  "promote  joint  initiatives,  support  research  and 
technological  development  and  coordinate  the  efforts  needed  for  the  exploration  and 
exploitation of space". Furthermore, the "Union shall establish any appropriate relations with 
the European space agency". Mechanisms should be found to ensure coordination within the 
EU  framework  so  that  Member  States  positions  expressed  in  international  organisations 
forums, including ESA, is consistent with and supports EU space policy. 

2. 

A HIGH TECH INDUSTRY DEFYING GLOBAL COMPETITIONS 

2.1. 

An industry facing international challenges  

The European space industry differs from its main international competitors to the extent that 
its  budget  is  smaller,  it  relies  more  on  commercial  sales,  the  share  of  military  expenses  is 
smaller and synergies between civil and defence sectors are far less developed. Unlike the US, 
the  European  market  for  downstream  navigation  and  Earth  observation  services  is  only 
emerging. These features account for the fact that the European industry is facing commercial 
and innovation challenges. 

2.1.1.  Threats  on  commercial  markets  on  which  EU  manufacturing  industry  is  highly 

dependent 

The  space  manufacturing  industry  (satellites,  launchers  and  ground  segment)  is  a  strategic, 
high-tech, high-risk and investment intensive industry with long development cycles and low 
production  rate.  In  all  space-faring  nations,  space  industry  mainly  depends  on  institutional 
programmes, which take two forms: financing of research and development programmes and 
buying space products and services, as customers of the industry6.  

Concerning  research,  institutional  space  R&D  policies  are  one  of  the  main  instruments  to 
shape  the  sector.  Total  European  R&D  is  roughly  estimated  to  account  for  10%  of 
unconsolidated sales turnover of the EU space sector. In an international context though, the 
funding  of  European  R&D  pales  (into  insignificance)  in  comparison  with  the  US.  US  civil 
space  budget spent on RTD is  at approximately 25%7. Expressed  per capita, the US  NASA 
civil  space  budget8  is  approximately  four  times  higher  than  all  the  European  civil  space 
budgets combined (national, ESA and FP7). 

In  comparison  to  other  space-faring  nations,  the  European  institutional  market  is  also 
relatively  small.  In  2009  the  US  budget  was  almost  ten  times  higher  than  the  European. 
Moreover, although space is a global market, it is difficult to speak of "a" European market. 
The  institutional  market  is  indeed  fragmented  due  to  the  existence  of  many  public 

6 
7 

8 

The Space Economy at a Glance 2007, OECD 
NASA financial report 2009, Euroconsult 2009, and estimates of space technology budgets by ESA for 
2009. 
It should, however, be noted that a considerable share of public resources for space research comes not 
from NASA but directly from other public agencies. 

EN 

5 

   EN 

 
                                                 
stakeholders and the implementation of different national and ESA's space industrial policies, 
without  always  the  necessary  coordination.  The  European  market  alone  is  therefore  not 
sufficient  to  sustain  the  current  level  of  excellence  of  the  European  space  industry.  In 
addition,  institutional  markets  of  most  space  faring  nations  are  closed  to  other  space  faring 
nations' industry. For these reasons, the European industry has to also rely on commercial and 
export  sales,  which  represent  45%  of  its  activities  according  to  Eurospace  data,  a  situation 
quite different compared to its competitors.  

Overall, the European manufacturing and launcher industry has performed well in the global 
commercial market, with a growing market share for satellites (mostly telecom) and a stable 
market  share  of  around  50%  for  commercial  launches.  However,  sales  on  the  commercial 
market,  which  are  vital  for  the  European  space  industry,  are  at  risk  since  commercial  sales 
exhibit cyclical downturns and since commercial and export markets are subject to increased 
and sometimes aggressive9 competition from other space faring nations. Because of the long 
lead  time  in  this  sector  (10-15  years  development  for  complex  systems)  it  is  essential  to 
anticipate well in advance any possible (market) evolution. Moreover, the situation can evolve 
very rapidly in certain strategic sub sectors, such as launchers10.  

2.1.2. 

Securing its positions: Preserving a world class industry on the telecommunication 
markets 

space 

industry.  According 

The satellite-based service industry is of major importance for the EU economy as it turns the 
investment made in space infrastructures into concrete applications and services to the benefit 
of citizens. The satellite communications (SatCom) manufacturing industry is instrumental in 
sales  of 
sustaining  Europe’s  entire 
telecommunications  satellites  represent  more  than  60%  of  European  satellite  manufacturers' 
turnover  over  the  last  10  years.  Europe  can  rely  on  a  world-class  industry  to  develop  and 
deliver  SatCom  services.  Those  services  are  key  in  delivering  information,  one  of  the  most 
important resources of  the growing  sectors of the digital  society. They contribute to several 
actions proposed in the Digital Agenda for Europe, notably to closing the broadband gap in 
low  density  populated  areas.  SatCom  is  a  highly  effective  solution  where  terrestrial 
technologies  are  too  costly  or  non-existent11,  as  well  as  to  provide  cross-border  digital 
services.  Besides,  it  provides  a  resilient  and  robust  fallback  solution  in  the  event  that  other 
networks should fail (natural disasters, terrorist attacks etc).  

to  Eurospace, 

Besides increasing competition, the European SatCom industry faces a technical and political 
challenge:  it  has  to  face  the  scarcity  of  radio  spectrum12,  which  is  a  vital  resource  for  the 
efficient  operation  and  development  of  satellite  communications.  In  order  to  maintain  the 
SatCom industry's competitiveness this issue needs to be addressed. 

9 

10 

11 

12 

High  tech  competitive  products  can  be  released  on  the  market  at  marginal  costs,  since  development 
costs  have  already  been  taken  in  charge  by  institutional  programmes.  The  "market  price"  is  arbitrary 
and linked to a nation's strategic and political goals. 
Given the very small launch rate for all launch service providers (fewer than 10 yearly launches for the 
European operator), every launch is of crucial importance and a reduction of more than one launch in a 
given  year  endangers  the  very  existence  of  the  sub  sector  and,  in  the  long  run,  of  Europe's  space 
industry, with potential dramatic consequences on Europe’s strategic independence. 
For  instance,  in  the  high-sea,  satellite  communication  services  are  the  only  available  option. 
Furthermore, affordable satellite communication can support the EU's "blue growth" strategy to support 
growth in the maritime sector. 
Spectrum is used by an increasing number of wireless applications in several sectors from short range 
devices 
terrestrial 
telecommunications services. 

to  electronic  communications  services 

like  satellite  communications  and 

EN 

6 

   EN 

 
                                                 
2.1.3.  The  new  frontier:  Positioning  the  EU  industry  on  emerging  markets  of  navigation 

and Earth observation applications (services and products) 

The European satellite navigation (SatNav) and Earth observation (SatEO) service industry is 
an  emerging  industry  with  a  high  worldwide  potential  for  growth  and  job  creation,  mainly 
made up of SMEs and start-ups (which form the backbone of our economy). They will be of 
increasing  importance  for  our  economy  and  citizens'  well-being.  GNSS  business  experts 
estimate that in ten years this market will reach $ 300 billion13.  

It  is  estimated  that,  already,  6-7%  of  GDP  in  Western  countries,  i.e.  € 800  billion  in  the 
European  Union,  is  dependent  on  satellite  radio  navigation14.  The  benefits  arising  from  a 
fully-fledged  operational  Copernicus  (new  name  for  GMES)  programme  through  2030  are 
estimated at 34.7 € billions, comp arable to 0.2 % of the EU GDP15. 

The deployment of GNSS and Copernicus infrastructures will soon open up new opportunities 
for the sector in Europe. Galileo and EGNOS are expected to generate economic and social 
benefits worth around € 60-90 billion over the next 20 years 16. Europe cannot afford to miss 
out on the growth of space activities and related services. Although some private applications 
have already proven successful, satellite enabled products and services still depend to a large 
part on public customers at national and local levels at this stage of development.  

In  Europe,  several  barriers  slow  down  the  development  of  innovative  applications  and 
therefore  market  development:  the  uncertainty  concerning  the  service  availability  and  the 
legal  framework,  the  lack  of  awareness  by  possible  users  of  their  potential,  the  lack  of 
cooperation  between  space  and  non-space  sectors,  the  lack  of  cooperation  between  data 
providers, service  developers and end users, the insufficient support to the creation  of start-
ups and the development of high-growth companies.  

2.2. 

To  address  these  challenges,  Europe  should  achieve  technological  non-
dependence, security of supply and maintain independent access to space 

Technological non-dependence, security of supply and independent access to space17 not only 
meet  the  imperative  of  strategic  independence:  they  represent  the  basic  conditions  for  a 
sustainable development of the European space industry. 

2.2.1.  Technological leadership, security of supply and non-dependence require sustained 

efforts and the availability of the necessary skills 

To face the increasing competition on the global market, European industry must maintain its 
technological edge and stay at the forefront of technological progress in selected areas. The 
challenges  faced  by  industry  include  how  to  ensure  technological  non-dependence  and 

13 

14 

15 

16 

17 

Len Jacobson, GNSS Markets and Applications (GNSS Technology and Applications), Artech House 
Inc, 2007 
Report  from  the  Commission  to  the  European  Parliament  and  the  Council,  Mid-term  review  of  the 
European satellite radio navigation programmes, COM(2011) 5 final, Brussels, 18.1.2011 
Study  carried  out  by  PriceWaterhouseCoopers  entitled  "Socioeconomic  benefits  analysis  of  GMES, 
available at http://esamultimedia.esa.int/docs/GMES/261006_GMES_D10_final.pdf, p. 180. 
Report  from  the  Commission  to  the  European  Parliament  and  the  Council,  Mid-term  review  of  the 
European satellite radio navigation programmes, COM(2011) 5 final, Brussels, 18.1.2011. 
"Independence”  implies  that  all  needed  space  technologies  are  developed  in  Europe,  whereas  “Non-
dependence” refers to the possibility for Europe to have free, unrestricted access to any required space 
technology.  

EN 

7 

   EN 

 
                                                 
security  of  supply,  the  need  to  replace  or  update  existing  technologies  and  products,  the 
challenge to develop new ones and the difficulty to maintain critical skills in a market with 
long  programme  cycles  and  highly  fluctuating  orders.  Besides,  synergies  between  civil  and 
defence  sectors  are  not  sufficiently  exploited  today,  which  hinders  the  emergence  of  a  real 
European  space  power.  Furthermore,  the  lack  of  efficient  cross-fertilisation  between  space 
and non-space sectors limits joint R&D activities and the capacity of technology take-up from 
both sides. 

Technological  non-dependence  of  this  strategic  sector  is  not  guaranteed.  In  a  number  of 
critical  technology  areas  European  programmes  are  fully  dependent  on  one  supplier18.  The 
European  Space  Technology  Platform  (ESTP)  estimates  that,  on  average,  60%  of  the 
electronics  on  board  a  European  satellite  are  currently  imported  from  the  United  States, 
because  of  the  lack  of  a  business  case  to  develop  those  components  at  European  level. 
Moreover, those imports are subject to ITAR export regulations,  which  evolve  according to 
US concerns, often create procurement delays and put in the short run the European industry 
in a further situation of dependence towards US policy fluctuations. In addition, space sector 
represents a small sector in comparison to the industry worldwide and often also a small part 
in the turnover of big industrial firms. It therefore has to cope with evolutions which do not 
take  its  specific  needs  into  account.  More  than  other  sectors,  space  industry  is  required  to 
anticipate  future  evolutions  –  in  terms  of  products  availability  and  regulations,  such  as 
REACH19 – which is all the more difficult given the long time lead to develop space products. 
In such a situation, changes in the commercial positioning or legislation, financial difficulties 
in  key  companies  or  lack  of  profitability  due  to  the  small  market  share  can  put  European 
space  programmes  at  risk,  with  delays  and  cost  overruns.  Both  for  industrial  and  strategic 
reasons,  efforts  made  to  develop  alternative  supply  sources  for  technologies  and  materials 
together with ESA and EDA should be strengthened in Horizon 2020. 

Without sufficient workload, the space industry's skilled workforce will be dismantled and it 
will  take  significant  time  and  resources  to  reassemble  the  required  teams  to  develop  new 
programmes.  Knowledge  and  skills  in  the  emerging  sector  of  navigation  and  Earth 
observation  technologies  are  currently  not  sufficient.  In  the  meantime,  new  space  faring 
nations are rapidly closing their "researchers' gap" with industrialised countries. 

2.2.2.  European  independent  access  to  space  must  be  preserved  and  strengthened  in  the 

long-term 

In all space faring countries around the world, launcher development and operations were and 
still  are  financed  by  public  money,  without  which  the  commercial  sector  would  not  exist. 
Moreover, the commercial prices obtained on the market do not cover the full costs, notably 
the  development  phase.  The  size  of  institutional  budgets  devoted  by  space  faring  nations  to 
launchers reflects their willingness to enjoy independent access  to  space.  In all competitors' 
countries,  public  procurements  are  paramount  for  the  survival  of  the  sector  and  the  local 
launcher industry would not exist without institutional programmes which are de facto closed 
to foreign industry.  

18 

19 

This is for example the case  with the atomic clocks on board the Galileo satellites, which is the core 
payload for such satellites and is produced in Europe by one single non-EU supplier, who is selling to 
China and India as well. 
Some  components or  materials  used for  space  (on  board satellites  or  launchers)  are  listed  in  REACH 
and need substitutes if possible. 

EN 

8 

   EN 

 
                                                 
In Europe, the launchers issue concerns, on the institutional side, the EU, the ESA and their 
Member States in two ways: first because of the political responsibility relating to Europe’s 
independent access to space; secondly as customers of the launcher industry aiming to carry 
out  and  launch  their  programmes  cost  efficiently.  Private  operators  are  also  concerned  as 
customers. They would benefit from a European independent access to space, as this increases 
their leverage in negotiating lower launch prices at international level. 

The  EU  and  its  Member  States  support  the  political  objective  of  maintaining  independent 
access to space, as stated in several Space Council and Competitiveness Council resolutions20. 
Historically, the European launch service was created to ensure Europe’s capacity to develop 
satellite  based  services,  following  the  refusal  by  other  countries  to  launch  European 
commercial satellites. Besides security and strategic considerations, were Europe deprived of 
independent access to space, such refusals could happen again and would cause delays in the 
implementation  of  our  space  programmes,  which  increase  costs  and  threaten  European 
competitive  position  both  on  manufacturing  and  services  markets.  The  availability  of  a 
reliable  and  competitive  European  launch  service  therefore  continues  to  be  a  sine  qua  non 
factor  ensuring  the  development  of  a  world-class  European  space  industry  and  of  satellite-
based applications.  

As clients, to carry out their programmes on time and thus avoid cost overruns, the EU, the 
ESA and their Member States must have at their disposal a launcher system which is: 

• 

• 

• 

• 

Reliable from a technical point of view, 

Secure,  which  may  require  launches  to  take  place  from  a  space  port  on  European 
soil, 

Available and independent: this covers control of the launch manifest and the need to 
avoid dependency on actors with conflicting industrial or geopolitical objectives, 

Cost efficient, as this contributes to affordability. 

Today there are not enough institutional launches in Europe to ensure the sustainability of the 
European launcher Ariane 521. Arianespace is facing stronger international competition and is 
having  difficulties  maintaining  its  financial  balance.  Furthermore  the  current  range  of 
launchers  will  need  to  be  replaced  by  2025  in  order  to  maintain  the  European  launcher 
capability, an issue which needs to be addressed now. 

With  over  30  satellites  to  be  put  into  orbit,  the  EU  as  a  whole  could  become  the  European 
industry's biggest institutional customer over the coming years. As stated in November 2010 
and  May  2011  Competitiveness  Council  conclusions,  all  European  institutional  actors  are 
invited, in order to maintain and strengthen an independent, reliable and cost effective access 
to space at affordable conditions, to consider as a high priority the use of launchers developed 
in  Europe  and  to  explore  issues  relating  to  their  possible  participation  in  launcher-related 
exploitation activities. European-developed launchers will therefore be adapted to qualify for 
the launch of some of these satellites. 

European  independent  access  carries  a  cost  in  the  short  term,  in  view  of  an  aggressive 
commercial  policy  by  our  competitors  which  usually  face  lower  costs.  Parts  of  these 
additional  costs  are  justified  on  objective  grounds  (guaranteeing  the  viability  of  European 

20 
21 

For instance 2007, 2008 and 2010 Space Councils, May 2011 Competitiveness Council. 
A minimum volume of institutional launches, as well as development programmes are needed without 
which reliability is no longer a given and the skills base could not be retained. 

EN 

9 

   EN 

 
                                                 
know-how  and  reliability,  lower  labour  costs  of  some  of  our  competitors,  size  of  foreign 
subsidies22  and  institutional  market).  Another  part  of  these  costs  is  the  result  of  industrial 
inefficiencies,  which  should  be  reduced.  In  the  medium  term  however,  independent  access 
would have a positive economic impact, both for institutional actors and private operators. It 
would  ensure  Europe  benefits  from  space-based  applications,  offers  additional  security 
(double-sourcing)  and  constraint  its  competitors  to  bid  competitive  prices  on  the  European 
market, favouring private operators. Moreover, for some programmes, there is no choice but 
to choose European launchers, for security considerations. 

3. 

OBJECTIVES OF AN EU INDUSTRIAL POLICY 

Considering the strategic importance of the space industry, its dependence on public funding 
and the increasing global competition on the commercial market, the EU will draw up a space 
industrial policy to support the development of the sector, thereby fostering economic growth. 
This  policy  should  encompass  not  only  space  manufacturing  industry  but  also  the  services. 
The  objectives  of  such  a  policy  have  been  analysed  in  various  studies.  The  issue  is  also 
addressed  in  the  Resolution  of  the  7th  Space  Council  and  the  May  2011  Competitiveness 
Council. 

Against  this  background,  the  EU  space  industrial  policy  could  be  centred  on  five  specific 
objectives:  

– 

Establish a coherent regulatory framework 

The expansion of space activities and in particular the growing market for space products and 
services  raise  legal  issues  which  are  not  being  fully  addressed  at  European  level  and  only 
partly addressed at national level by a few Member states through national laws, which reflect 
national  interests.  Fully  taking  into  account  existing  legislations  and  according  to  the 
respective competences of the different actors, the Commission will explore whether actions 
need  to  be  undertaken  to  improve  legal  coherence  and  foster  the  emergence  of  a  European 
market for space products and services. 

– 

Further  develop  a  competitive,  solid,  efficient  and  balanced  industrial  base  in 
Europe and support SME participation 

Europe needs a stronger industrial base. The European space industry should further improve 
its  performance,  benefiting  from  a  less  fragmented  environment.  A  balanced  industrial  base 
does  not  mean  the  equal  spread  of  this  niche  industry  all  over  Europe,  but  an  industry  that 
builds on competitive advantages of the whole supply chain and provides fair access to SMEs 
as a means to ensure dynamism and innovation and, in particular, to develop the space service 
industry. The participation of small businesses and mid-size industries in the supply chain is 
essential  for  the  competitiveness  of  the  European  space  manufacturing  industry  and  for  not 
merely consolidating, but also expanding a skilled workforce. 

– 

Support  the  worldwide  competitiveness  of  European  space  industry  and  encourage 
the sector to become more cost-efficient along the value chain 

The European space industry should maintain and increase its share of the global market and 
should remain at the cutting edge of technological developments with a capacity to produce 
breakthrough technologies and be actively involved in cross-fertilisation with other sectors. It 

22 

Whose real level has to be assessed over the entire value chain, from public funding in the development 
phase, public support in the production phase or for the launch base to preference for domestic launches 
and access to market. 

EN 

10 

   EN 

 
                                                 
should aim at becoming more cost-efficient along the value chain. The industry should also be 
able  to  rely  on  sufficient  high-skilled  manpower,  in  particular  in  the  emerging  sector  of 
navigation  and  Earth  observation  technologies.  Policy  should  support  increased  market 
access.  

– 

Develop markets for space applications and services 

European  industry  must  be  in  a  position  to  exploit  the  potential  offered  by  space 
infrastructures  (SatCom,  SatNav  and  SatEO)  in  order  to  deliver  reliable  and  cost-efficient 
services responding to economic and societal needs. This means for certain service categories 
not  only  the  development  of  new  capacities  within  existing  industry  but  also  the  quality 
improvement of Copernicus data, the creation and stimulation of an environment allowing the 
take-up of new satellites technologies and the emergence of new operators, given notably the 
importance  of  small  businesses  in  this  area.  Together  with  the  second  objective,  the 
achievement of this one will help maintain space investments attractive to all Member States. 

– 

Ensure the technological non-dependence and an independent access to space 

For  Europe  to  be  able  to  pursue  strategic  policy  initiatives  and  provide  key  services  for 
citizens' benefit, it requires an independent access to space. Furthermore, European industry 
should be triggered to further develop its technological non-dependence, especially in critical 
technologies, to continue to be able to deliver the products and services needed for economic 
growth and its citizens' well-being. 

4. 

HOW TO ACHIEVE THE OBJECTIVES OF THE EU INDUSTRIAL POLICY 

In order to achieve the objectives of this policy in collaboration with ESA and the Member 
States,  the  EU  can  use  the  instruments  at  its  disposal,  which  are  mainly  improving  the 
framework conditions, supporting research and innovation, promoting better use of financial 
instruments and of existing procurement regulations23. 

4.1. 

Improving framework conditions 

As space activities expand, the appropriateness of the existing regulatory framework needs to 
be  examined  to  ensure  the  security,  safety  and  sustainability  of  such  activities  and  their 
economic development. 

4.1.1. 

Improving the regulatory framework for the service segment and the manufacturing 
sector 

The expansion of space activities and in particular the growing market for space products and 
services  raise  legal  issues  which  are  not  being  fully  addressed  at  European  level,  but  only 
partly addressed by the most active Member States in this domain through national law. The 
majority of Member States have not yet developed space legislation. The scope and objectives 
of  these  emerging  space  national  laws  are  diverse  and  have  implications  that  go  beyond 
national boundaries. 

National  legislation  alone  will  not  ensure  a  coherent  coverage  of  space-related  legal  issues 
and  a  harmonised  legal  framework  for  all  Member  States.  An  inconsistent  legal  framework 
may negatively affect the functioning of the internal market. It may therefore be necessary to 
take steps towards the establishment of a coherent EU space regulatory framework to tap the 

23 

The initiatives proposed will be set up and implemented in full conformity with the Community rules 
on State aid, in particular with regard to situations where Member States funds would be involved. 

EN 

11 

   EN 

 
                                                 
potential of an internal market for space by filling legal gaps  in a coherent  way, preventing 
diverging national legal frameworks, safeguarding national and European security interests.  

To  take  an  example,  some  European  countries  have  national  legislation  on  liability  which 
foresees  the  coverage  of  physical  damage  caused  by  space  activities.  Some  countries  limit, 
under  certain  conditions,  the  liability  up  to  a  certain  amount,  or  provide  governmental 
guarantee under certain conditions. Some countries request an insurance or another financial 
guarantee  to  compensate  possible  damages.  The  absence  of  coherent  rules  in  EU  countries 
could create distortions of competition on the internal market and lead to "forum shopping". 

Examine the possibility of a legislative initiative on certain aspects that have an impact on 
the emergence of a single market for space products and services  

The  Commission  will  therefore  assess  to  which  extent  this  fragmented  framework  could 
hinder the proper functioning of the internal market and whether an EU intervention would be 
justified. 

The first step in this direction could be a legislative initiative on production and dissemination 
of private satellite data (see below) and a regulation on EU GNSS third party liability24. 

EU action may also be required in dual-use export control and spectrum policy. In other fields 
such  as  commercial  spaceflights,  the  opportunity  of  EU  intervention  should  be  further 
assessed. 

In order to ensure the full exploitation of space-based information and to boost users' access 
to  space  data  and  services,  the  EU  could  consider  establishing  an  overarching  data  access 
policy. Such a data access policy could be based upon principles as: free and open access for 
public  organisations  at  EU  and  national  level  guaranteed  (as  a  minimum)  with  limited 
restrictions  when  fully  developed  and  operated  with  EU  public  funds;  establishment  of 
specific conditions regarding data access policy (at least for public organisations) when there 
is an EU intervention in the development of space assets or markets.  

Consider  proposing  a  legislative  initiative  on  production  and  dissemination  of  private 
satellite data  

The production and dissemination of satellite data raises three main issues. First, the security 
restrictions  imposed  by  national  authorities  on  satellite  data  according  to  national  security 
interests may endanger competitiveness and innovation (downstream development of related 
services) and lead to legal uncertainty in the internal market, and raise liability issues such as 
compensation  claims  for  potential  damages,  for  example  those  caused  by  incorrect  data. 
Second,  the  inadvertent  release  of  data  acquired  by  satellite  sensors  (e.g.  high-resolution 
imaging) could pose a threat to security of EU and EU Member States. Third, the cross-border 
nature of satellite data exchanges requires cooperation between countries concerned by Earth 
observation. Such cooperation would effectively ensure the compatibility of competitiveness 
standards with security considerations. 

24 

EU GNSS will have a global coverage. Claims could be lodged in any country in the world before the 
local courts under the applicable local legislation. The EU is preparing a regulation on EU GNSS third 
party liability. A similar discussion was held under the aegis of UNIDROIT ("International Institute for 
the Unification of Private Law") with respect to all services offered by the GNSS. Discussions in this 
forum have been put on hold in order to potentially integrate initiatives to be adopted at regional level.  

EN 

12 

   EN 

 
                                                 
As  national  legislation  alone  cannot  guarantee  a  coherent  regulatory  EO  framework  at  EU 
level, EU action could be justified on grounds of subsidiarity. Taking into account the benefits 
in terms of legal certainty, downstream development of markets and the protection of security, 
an EU intervention in this domain could bring clear added value.  

Monitor and improve the export control and intra-EU transfer frameworks 

Many components of space systems are considered of dual or military nature and, hence, are 
subject to the new regulatory framework on intra-EU transfer and dual-use export control25. 
Simplified  rules  and  procedures  that  will  facilitate  intra-EU  transfers  of  components  of  a 
military  nature  will  be  implemented  from  2012  onwards26.  This  will  improve  the 
competitiveness of European industry, in particular SMEs. 

In  conformity  to  Article  25  of  the  Dual-use  Regulation,  which  requires  the  Commission  to 
prepare a report on the implementation of the EU export control system, a Green paper27 has 
been  adopted  to  launch  a  broad  public  debate  concerning  the  functioning  of  the  current  EU 
dual-use export control system. A formal report to the European Parliament and the Council is 
foreseen  in  September  2012.  In  the  meantime,  the  impact  of  this  regulation  on  the  space 
industry  should  be  closely  monitored  with  a  view  to  identifying  major  problems  and 
proposing appropriate solutions. 

Ensure the availability of spectrum 

To  contribute  to  ensuring  the  availability  of  a  radio  spectrum  for  space  operations  that  is 
immune  from  interference,  to  enable  economies  of  scale  and  optimise  operational  costs  for 
pan-European  systems,  the  Commission,  together  with  the  EU  Member  States,  will 
investigate how to best take into account the future spectrum needs for SatCom in the context 
of the Radio Spectrum Policy Programme and contribute to the preparation of the next ITU 
World  Radio  Communications  Conference  in  order  to  defend  EU  interests  in  the  field  of 
global and regional spectrum allocation. 

Explore  whether  commercial  spaceflights  activities  need  to  be  embedded  in  a  legal 
framework 

“Suborbital  aeroplane  projects”  or  commercial  spaceflight  projects  are  emerging,  mainly  in 
the  United  States.  Suborbital  flights  could  constitute  a  promising  market  for:  (i)  scientific 
experiments:  microgravity  experiments,  astronauts  training,  test  of  satellite  payloads,  (ii) 
space tourism and (iii) future clean, high altitude, high speed and point-to-point air transport 
systems.  Furthermore,  suborbital  flight  vehicles  could  offer  more  cost-efficient  access  to 
space e.g. for small satellites. 

Only  the  US  Federal  Aviation  Administration  (FAA)  and  its  office  of  Commercial  Space 
Transportation  have  issued  a  regulatory  framework  for  suborbital  planes  applicable  in  their 

25 

26 

27 

Regulation  (EC)  No  428/2009  of  5  May  2009  setting  up  the  EU  export  control  regime  for  dual-use 
goods  and  Directive  2009/43/EC  of  6  May  2009  regarding  the  transfer  of  defence-related  products 
within the Community. 
Previous  requirements  imposed  a  significant  administrative  burden  on  companies  (estimated  at  225 
hours/licence in the impact assessment of the Directive 2009/43/EC on EU intra-Community transfer of 
defence products). They also implied long lead times – up to several months – in order to obtain transfer 
or export licenses. 
The dual-use export control system of the European Union: ensuring security and competitiveness in a 
changing world COM(2011) 393 final. 

EN 

13 

   EN 

 
                                                 
country. It is based on an “informed consent” regime for carrying the crew and space flight 
participants28. Passenger safety is therefore not ensured by the regulation. 

Some  European  industry  stakeholders  call  upon  the  EU  to  put  in  place  a  stricter  regulatory 
framework, with adequate certification rules derived from aeronautic best practises, to better 
guarantee passenger safety. Industry argues that the predictability of the regulatory framework 
is  key  for  private  investors,  since  it  will  drive  the  technology  used  and  the  development 
activities. Other European stakeholders call upon the EU to put in place a more innovation-
friendly regulatory framework. 

This request is for the time being not a priority in the rulemaking programme of the European 
Aviation  Safety  Agency  (EASA).  The  Commission  will  further  investigate  this  issue  to 
determine whether it needs to be addressed in the near future. 

4.1.2.  Pursue the Standardisation process 

The importance of standardisation for space activities in Europe is growing as the EU, ESA, 
national space agencies and European industry are faced with new technical challenges within 
more  demanding  economic  constraints.  Through  a  more  efficient  and  effective  use  of  space 
technologies and space-based applications and services, standardisation has a role to play in 
boosting the competitive position of the European space industry in the world market, notably 
by  increasing  the  series  and  thus  decreasing  the  prices,  and  in  helping  SMEs  enter  certain 
segments  of  the  space  market.  Space  standardisation  supports  the  uptake  of  space-based 
innovative  services  and  applications.  Space  missions  are  moreover  a  risky  business  where 
technology is pushed to the limit, where there is very limited possibility to correct problems 
that were not identified before launch. Standardisation is therefore seen as a way to decrease 
the  risks  of  failure,  to  guarantee  the  technological  reliability  of  space  products/components 
and  to  reduce  the  development  and  operational  costs.  Finally,  since  European  space 
production  is  split  between  several  countries,  the  development  of  "standardised"  working 
procedures can help reduce some of the inefficiencies currently present in the value chain. 

The main European space agencies and industry started the European Cooperation for Space 
Standardisation  (ECSS)  in  1993.  More  than  120  standards  have  been  published.  While 
upstream  space  activities  have  been  covered,  space  downstream  activities  geared  toward 
systems and services still need standardisation. A comprehensive standardisation programme 
was proposed in March 2010 and identifies ten specific sectors where future standardisation 
work  could  be  carried  out  by  technical  bodies  in  CEN/CENELEC,  ETSI  and  ECSS  –  the 
European  Standardisation  Organisations  (ESOs).  The  programme  has  been  translated  into  a 
new mandate (M/496) which has been issued on the 1st of September 2011 and addressed to 
the ESOs. The work has started in 2012 and should extend over a three-year period. 

4.1.3.  Ensure the availability of necessary skills 

The  availability  of  a  skilled  workforce  has  a  direct  impact  on  the  capacity  of  the  European 
space industry and space activities in return have a direct impact on workforce availability in 
the European economy, through the impact of leading edge development programmes in the 
development of expertise in new technologies. In order to remain competitive, Europe will be 
facing  a  triple  challenge  in  the  years  to  come:  to  keep  and  expand  its  own  resources  (skill-

28 

To obtain a license, the operators of suborbital aeroplane just have to inform paying passengers about 
the risks of the launch and re-entry phases and the safety record of the vehicle type. The passenger then 
signs a waiver accepting the risk taken. 

EN 

14 

   EN 

 
                                                 
levels and workforce numbers), to develop new skills to satisfy the need of emerging sectors 
and to attract talent from third countries. 

Institutional space programmes can  help  maintaining a sufficient level of industrial activity, 
attracting  leading  talent  to  European  universities  and  research  centres,  and  facilitating 
mobility between Member States and between the public and private sectors.  

The European institutional customers should develop and provide to industry a long term and 
clear  planning  of  the  institutional  market  in  Europe.  The  EU  could  set  up  a  mapping  and 
foresee  regular  updates  of  the  supply  chain  to  ensure  the  right  level  of  European 
independence, expertise and competitiveness. 

Together with  the Member States and their regions, the EU should address and turn around 
the  shortage  of  highly-skilled  aerospace  engineers  and  technicians  coming  out  of  the 
European  educational  systems,  promote  the  establishment  of  mutually  recognised  academic 
space  qualifications  in  Europe,  include  in  future  R&D  framework  programmes  dedicated 
actions  in  which  part  of  the  research  must  be  done  by  PhD  candidates,  encourage  the 
development  of  lifelong  learning  programmes  through  strengthened  cooperation  between 
industry and universities and enhance its appeal to foreign researchers. 

4.1.4. 

Support access of European industry to the global market 

It  is  vital  for  the  European  space  industry  to  maintain  and  strengthen  its  position  on  the 
commercial market. However, major third countries' institutional markets are not accessible to 
the European industry. Some Member States have proposed Export facilitation mechanisms to 
support  industry  access  to  the  global  market.  The  possibility  to  develop  such  mechanisms 
should be further assessed. 

Commercial  agreements  and  trade  negotiations  can  contribute  to  ensuring  a  "level  playing 
field" for the European space industry at international level, provided EU has a strong enough 
stand in international negotiations. The Commission has therefore recently adopted a proposal 
on  access  of  third  countries  to  the  EU's  public  procurement  market29.  If  adopted  by  the 
Legislator, this Regulation would to improve the conditions under which EU businesses can 
compete for public contracts in third countries, by strengthening the position of the European 
Union when negotiating access for EU companies to the public procurement markets of third 
countries, in order to open up our trading partners’ markets, and by improving, in line with the 
EU’s  2020  strategy,  business  opportunities  for  EU  firms  on  a  global  scale,  thereby  creating 
new jobs.  

More  generally,  international  cooperation  should  also  serve  as  a  market  opener  for  the 
promotion  of  European  technology  and  services  in  the  space  field  and  help  strengthen  this 
strategic industrial sector. The EU must ensure that space-related matters are better integrated 
into the Union's external policy. 

4.2. 

Supporting Research and Innovation 

Research,  development  and  innovation  not  only  are  key  elements  of  space  industrial 
competitiveness, but also essential ingredients of a sustainable economic growth, be it in the 
short  run  as  in  the  long  run,  with  effects  on  the  ability  of  the  European  Union  to  remain 

29 

European Commission Proposal for a Regulation of the European Parliament and of the Council on the 
access  of  third-country  goods  and  services  to  the  Union's  internal  market  in  public  procurement  and 
procedures  supporting  negotiations  on  access  of  Union  goods  and  services  to  the  public  procurement 
market of third countries, COM(2012)124 final 

EN 

15 

   EN 

 
                                                 
competitive in an increasingly globalised economy. The budget for Space under Horizon 2020 
(the successor of FP7) is proposed to be 1737 million euro in current price (1548 million in 
constant 2011 price) for 7 years. Space in Horizon 2020 will cover R&D and innovation with 
the objectives to:  

• 

• 

• 

• 

Enable  European  competitiveness  in  space,  non-dependence  and  innovation  in 
space activities, focussed on industrial R&I, emphasizing SMEs; 

Enable advances in space technologies, ranging from basic technology research to 
close-to-application  technologies  for  future  generations  of  Copernicus/GMES  and 
Galileo satellites; 

Full  exploitation  of  space  data,  including  data  from  scientific  missions  and 
commercial applications of space data; 

Enable  European  R&D  in  the  context  of  international  space  partnerships  (e.g. 
ISS, SSA, global robotic exploration programmes).  

Concerning  the  latter,  cutting  edge  space  technology  is  increasingly  taking  place  in 
international frameworks, making access to such programmes an important success factor for 
the competitiveness of European researchers and space industries.  

4.2.1.  Enable  European  competitiveness  in  space  worldwide,  notably  by  ensuring 
European non-dependence in critical technologies and by fostering innovation 

The objective is to maintain a globally leading role in space by safeguarding and developing a 
competitive space industry and research community and by fostering space-based innovation. 

First, the survival of a competitive commercial industry in the space sector in Europe and the 
capability for European institutional customers to implement their missions require a decrease 
in European technical dependence  on non-European countries. It is  of utmost importance to 
identify  which  technologies  are  critical  and  to  ensure  that  for  these  Europe  develops  and 
maintains  its  own  technology  solutions  and  production  capacities.  Once  the  technology  has 
been developed, it should be used consequently by institutional actors and European industry. 
Otherwise, it will be lost. 

The European Commission, together with ESA and EDA have created a joint task force with 
the  aim  of  producing  a  coherent  list  of  critical  technologies  for  priority  development.  This 
joint European non-dependence process has started in 2009. A list of urgent actions has been 
agreed upon and used as the basis for the FP7 4th Call on critical technologies. This initiative 
should be pursued.  

Secondly,  satellite  enabled  products  and  services  constitute  an  emerging  market  and  remain 
limited and fragmented. At this stage of development, they still depend to a large part on public 
customers at national and local levels. Incentives for new markets using space based services 
have been created in the US due to a long term policy of promoting governmental use which 
created  a  virtuous  circle  by  boosting  private  businesses  that  need  in  turn  more  space  based 
infrastructures. These initiatives boost the use of space for the benefit of public policies and make 
these  companies  more  competitive  on  export  markets.  It  should  be  assessed  whether  similar 
incentives can be provided to European industry. 

In  order  to  promote  the  exploitation  of  satellite  infrastructures  and  develop  the  market  for 
satellite based services, the EU should increase the promotion of space-based applications in 
EU  policies.  The  creation  of  new  applications  needs  to  be  stimulated  across  a  variety  of 
potential  public  and  private  users  including  new  user  communities  (cities,  regions,  various 

EN 

16 

   EN 

 
industrial  sectors,  etc),  notably  through  ad-hoc  take  up  actions,  such  as  vouchers  for  local 
authorities  or  SMEs,  to  facilitate  the  adoption  of  new  services  by  the  final  users.  Their 
development and deployment, often by SMEs, need to be supported on a consistent basis to 
ensure sustainable effects on qualified employment. 

More  specifically,  the  full  innovation  potential  created  by  the  new  European  space 
infrastructures also needs to be supported. The Commission GNSS Action Plan to foster the 
development and adoption of satellite navigation applications using EGNOS and Galileo is a 
first step in that direction.  

There  is  need  for  a  much  stronger  effort,  coordinated  at  European,  national  and  local  level. 
This requires the deployment of a whole range of innovation support measures30 to industry 
with a specific focus on SMEs. However, in order to address this market failure, innovation 
support  should  be  targeted  to  those  services  which  would  not  be  developed  by  the  market 
otherwise. Such measures should in particular encourage demand-side innovation, the use of 
available funding sources including regional funds, demand aggregation and development of 
new businesses.  

Finally, a number of challenges in space technologies have parallels to terrestrial challenges. 
Cross-fertilisation should be fostered, by promoting development of innovative products and 
services based on satellite infrastructures. As stated in the annex of the proposal for a Council 
decision  establishing  the  Specific  Programme  Implementing  Horizon  202031,  "these 
commonalities  offer  opportunities  for  early  co-development,  in  particular  by  SMEs,  of 
technologies across space and non-space communities, potentially resulting in breakthrough 
innovations more rapidly than achieved in spin-offs at a later stage".  

4.2.2.  Enable advances in space technologies 

The objective is to ensure the capability to access space and to operate space systems to the 
benefit  of  European  society  in  the  next  decades.  The  EU  notably  intends  to  boost 
technological progress in a number of strategic areas and to contribute to the necessary effort 
in  space  research  in  particular  in  breakthrough  technologies.  With  Horizon  2020  the  EU 
would for instance support the exploitation of synergies in space research at European level, 
promoting  further  coordination  of  R&D  activities,  thus  complementing  ESA  and  national 
programmes  already  addressing  these  issues.  Key  Enabling  Technologies  have  been 
recognized as key to all technological industrial competitiveness in Horizon 2020, but also in 
particular  to  innovative  space  technologies.  The  space  industrial  policy  should  therefore 
support their uptake in new space technologies.  

Horizon  2020  could  for  instance  promote  R&D  support  to  industry  and  space  research 
organisations,  support  the  development  of  application-oriented  R&D  programmes  at 
universities  related  to  space  technologies  and  promote  the  transition  from  prototyping  to 
product/market. Since users require mature technologies (already tested and validated), R&D 
support  schemes  should  allow  supporting  validation  and  qualification.  Hosted  payloads32 
could  contribute  demonstrating  the  required  flight  heritage  for  an  increasing  number  of 
products and services. In order to mitigate the risk created by new technologies for the rest of 

30 

31 
32 

For example market replication, pre-commercial procurement, clusters, living labs and other user-driven 
innovation mechanisms. 
COM(2011) 811 
It  refers  to  the  utilization  of  available  capacity  on  commercial  satellites  to  accommodate  additional 
transponders, instruments, or other space bound items. 

EN 

17 

   EN 

 
                                                 
the  payload,  the  possibility  of  cost-effective  launch  opportunities  to  embark  and  test  new 
technologies should be assessed. 

Furthermore, Horizon 2020 could be used to find alternatives for the components listed within 
the REACH framework33, and which may need substitutes in the future. 

4.2.3. 

Stimulate  the  full  exploitation  of  space  data  and  the  development  of  innovative 
applications 

The  objective  is  to  ensure  more  extensive  utilisation  of  space  data  from  existing  and  future 
European missions in the scientific, public and commercial domain. As stated in the annex of 
the  proposal  for  a  Council  decision  establishing  the  Specific  Programme  Implementing 
Horizon 2020, "a considerably increased exploitation of data could be achieved if a concerted 
effort were made to coordinate and organise the processing, validation and standardisation of 
space  data  from  European  missions.  Innovations  in  data  acquisition  and  processing,  data 
fusion, and data dissemination, utilising also innovative ICT enabled forms of collaboration, 
can ensure a higher return on investment of space infrastructure". 

4.3. 

Expanding the array and the use of available financial instruments 

Space infrastructures funding differs from space components/services financing. Large scale 
infrastructures which have to be built, developed, operated and maintained in order to ensure 
the continuity of operational services and applications, need large financial contributions over 
long  periods,  continuity  of  funding  both  for  operational  and  financial  reasons  (any  expense 
postponement  results  in  additional  costs)  and  flexibility/contingency  instruments,  given  the 
associated  risks.  Existing  financial  products  on  the  market  might  not  match  these  needs, 
especially because of the important time lead between the decision to develop such projects 
and  the  return  on  investment  by  the  deployment  of  sufficient  downstream  services.  There 
basically  is  a  market  failure  and  public  funding  is  needed  before  the  long-term  growth 
potential of such projects will emerge. Other space-faring nations have addressed this issue in 
their own ways34. In its proposal concerning the next Multiannual Financial Framework, the 
Commission  proposes  a  new  type  of  instrument,  i.e.  the  EU  project  bond  initiative  which 
would be used as a means of securing investment resources for infrastructure projects of key 
strategic European interest by making use of Public Private Partnership schemes to reinforce 
EU  competitiveness  and  growth  sustainability.  Although  the  scope  of  this  initiative  is  not 
foreseen to cover space in the first stage, space industry could be offered at a second stage the 
possibility  to  benefit  from  this  mechanism,  provided  it  fulfils  the  criteria,  in  particular 
regarding revenue generation35. 

SMEs'  participation  should  be  encouraged  where  appropriate  in  the  supply  chain  of  the 
manufacturing  industry,  in  particular  in  niches,  and  in  the  fast-growing  sector  of  satellite 
enabled  services.  The  financial  instruments  of  the  Competitiveness  and  Innovation 
Framework  Programme  and  also  the  Risk  Sharing  Financial  Facility  for  SMEs  (RSI)  are 
available  to  enhance  industrial  and  SMEs  innovation  capacities  and  competitiveness.  As  of 

33 

34 

35 

In  general,  REACH  addresses  individual  substances  in  the  different  lists  associated  to  its  processes. 
Some  of  these,  like  the  "Candidate  list"  or  Annex  XIV  (list  of  substances  subject  to  authorisation) 
trigger direct information requirements on articles ("components") or require authorisation of the use of 
the substance in Europe.  
It refers notably to the two 10-year contracts recently awarded by the US government to two commercial 
satellite imaging companies. 
Cf. COM(2011) 659, COM(2011) 660 and COM(2011) 662 concerning the Europe 2020 Project Bond 
Initiative. 

EN 

18 

   EN 

 
                                                 
2014,  SMEs  may  also  benefit  from  the  EU  financial  instruments  (debt  and  equity  finance) 
foreseen  under  the  forthcoming  programmes  COSME  and  HORIZON  2020,  which  include 
venture capital. 

Local  authorities  are  key  players  to  enhance  the  competitiveness  of  the  space  industry. 
Regions  have  a  major  role  to  play.  The  EU  has  developed  a  range  of  instruments 
strengthening  economic,  social  and  territorial  cohesion,  in  particular  the  European  Regional 
Development Fund (ERDF) and its schemes like the Joint European Resources for micro to 
medium Enterprises (JEREMIE). If the primary objective of EU cohesion policy is to reduce 
the  significant  economic,  social  and  territorial  disparities  that  still  exist  between  Europe's 
regions, cohesion policy also has a key role to play in delivering the Europe 2020 objectives 
throughout  the  EU  and  could  therefore,  through  its  support  to  SME  competitiveness  and 
innovation,  contribute  to  space  projects  financing  and  to  promoting  the  use  of  space  based 
services in accordance with eligibility rules of the Structural Fund (for instance, proven social 
and economic impact on the region or regional innovation impact). Space projects could be 
relevant  to  foster  research  and  innovation  in  the  framework  of  the  national  or  regional 
strategies for smart specialisation. 

4.4.  Making a better use of procurement policy 

Several Space Council Resolutions highlighted the need to develop adequate EU instruments 
and  funding  schemes  taking  into  account  the  specificities  of  the  space  sector".  In  the  space 
sector  procurement  is  one  means  among  others  to  achieve  industrial  policy  objectives.  It  is 
perhaps the most important because it is through procurement that the vast majority of public 
funding is channelled to industry in this sector. It is therefore necessary to determine whether 
the space procurement approach can be improved. 

Like the defence and security sectors, space is strategic and procurement of space systems and 
applications  for  public  needs  shares  characteristic  with  those  sectors,  in  particular  non-
dependence  aspects,  national  security  and  safety  aspects  as  well  as  high  and  long  term 
investment needs in R&D phases. The impact of the implementation of the EU Directives on 
public procurement and  defence procurement36 on the national and  European  space markets 
should also be further analysed. 

EU procurement is governed by the Financial Regulation and its Implementing Rules which 
are  in  line  with  the  WTO  Agreement  on  Government  Procurement.  These  instruments 
embody  the  principle  of  non-discrimination  and  do  not  allow  any  form  of  geo  return.  As  a 
customer of the space industry which is to deliver its programmes, the EU should develop and 
provide  to  industry  a  long  term  and  clear  planning  of  the  institutional  market.  Besides,  for 
programmes  which  involve  joint  funding  by  both  the  Commission  and  ESA,  early 
coordination should take place to ensure a smooth transition between the development phase 
and the operational phase. 

4.5. 

Establish and implement a real European launcher policy 

EU autonomy in strategic sectors like launch services is of fundamental importance. In view 
of  this,  the  EU  space  industrial  policy  should  pursue  the  following  objectives:  (i)  Ensure  a 
reliable, secure, available and cost efficient launcher system; (ii) Create the conditions, and in 
particular  the  financial  conditions,  which  are  necessary  to  maintain  and  strengthen 
independent  European  access  to  space  in  line  with  institutional  needs  while  proposing  an 

36 

Directives 2004/18/EC and 2009/81/EC 

EN 

19 

   EN 

 
                                                 
evolved  governance  of  the  exploitation  of  the  European  launchers  to  ensure  financial 
efficiency in the management of user programmes. 

A real European launcher policy must be established by the institutional actors, as is the case 
in  the  other  space-faring  nations,  to  avoid  short term or case by case decision taking which 
would endanger the above goals. The EU should recognize the political stakes of independent 
access  to  space  when  implementing  public  programmes  such  as  Galileo  and  Copernicus. 
Member  States  should  consider  accepting  a  share  of  the  burden  by  putting  their  launcher 
purchasing  policies  in  line  with  the  goal  of  independent  access  and  by  putting  the  EU  in  a 
position  to  be  able  to  contribute  to  that  goal.  In  addition,  the  overall  governance  of  the 
launcher sector, in particular as concerns its exploitation and the necessary measures to ensure 
the efficiency of its production, must evolve, in order to ensure sustainable financing of the 
exploitation. 

4.6. 

Ensure the sustainability of space activities in Europe 

With increasing dependence on space-based systems and services, ensuring their sustainable 
operations  will  become  increasingly  important.  Any  shutdown  of  even  a  part  of  space 
infrastructures  which  form  the  backbone  of  a  wide  range  of  services  could  have  significant 
consequences  for  European  citizens'  safety  and  for  the  well-functioning  of  economic 
activities. However, space infrastructures are increasingly threatened by collision risks due to 
the  growing  population  of  satellites  or  the  increasing  amount  of  space  debris  in  the  most 
commercially exploited orbits. 

In order to mitigate the risk of collision it is necessary to identify and monitor satellites and 
space  debris,  catalogue  their  positions,  and  track  their  movements  (trajectory)  when  a 
potential risk of collision has been identified so that satellite operators can be alerted to move 
their  satellites.  This  activity  is  known  as  space  surveillance  and  tracking  (SST).  As 
operational  SST  services  at  European  level  do  not  exist,  European  satellite  operators  rely 
today  to  a  large  extent  on  US  SST  information.  The  need  for  a  proper  SST  capability  to 
improve the provision of SST information at European level was highlighted by EU Member 
States in several Council conclusions. In accordance with these conclusions, the Commission 
intends  to  come  forward  with  a  proposal  setting  out  the  organisational  framework  for  the 
setting  up  and  operation  of  a  European  SST  service  in  partnership  with  Member  States 
building on their existing assets and expertise. 

5. 

CONCLUSIONS 

Space industrial policy supports the objectives of the Europe 2020 strategy, Europe's growth 
strategy for a smart, sustainable and inclusive economy. It is an integral part of the industrial 
policy flagship, which calls for a European industrial policy creating the best environment to 
maintain  and  develop  a  strong,  competitive  and  diversified  industrial  base  in  Europe, 
improving employment and knowhow of the sector. However, the Europe 2020 strategy also 
recognises  that  space  policy  contributes  to  the  competitiveness  of  European  industry  well 
beyond the space sector. 

EN 

20 

   EN 

 
ANNEX  

MEASURES ENVISAGED FOR THE SPACE INDUSTRIAL POLICY 

1. 

IMPROVING FRAMEWORK CONDITIONS 

1.1. 

Improving  the 
manufacturing sector 

legislative  framework  for  the  service  segment  and  the 

1.1.1.  Develop space legislative framework to strengthen the European space market 

• 

Propose  a  legislative  instrument  on  production  and  dissemination  of  private 

satellite data;  

•  Examine the possibility of a legislative instrument on certain aspects that have an 
impact on the emergence of a single market for space products and services such 
as:  obligation  of  insurance,  registration  and  authorisation  of  space  activities  and 
services , sanctions, environmental issues. 

1.1.2.  Monitor and improve the export control and intra-EU transfer frameworks 

•  Monitor  the  impact  on  the  space  industry  of  the  implementation  of  Regulation  (EC) 
No 428/2009 of 5 May 2009 setting up the EU export control regime for dual-use goods 
and  Directive  2009/43/EC  of  6  May  2009  regarding  EU  intra-Community  transfer  of 
defence products. 

1.1.3.  Ensure the availability of spectrum 

• 

Investigate  how  to  best  take  into  account  the  future  spectrum  needs  for  SatCom  in  the 

context of the Radio Spectrum Policy Programme; 

• 

Contribute  to  the  preparation  of  the  next  ITU  World  Radio  Communications 
Conference  in  order  to  defend  EU  interests  in  the  field  of  global  and  regional  spectrum 
allocations. 

1.1.4.  Explore whether commercial spaceflights activities need to be embedded in a legal 

framework 

• 

Launch  a  study  to  assess  the  market  potential  of  suborbital  spaceflights  to  determine 

whether to develop a European regulatory approach. 

1.2. 

Pursue the Standardisation process 

• 

Pursue  the  development  of  European  Standards  for  the  space  industry  on  the  basis  of 
the  work  started  by  the  ECSS  (European  Cooperation  for  Space  Standardisation)  and  the 
third mandate to CEN-CENELEC and ETSI. 

EN 

21 

   EN 

 
1.3. 

Ensure the availability of necessary skills 

•  Develop and provide to industry a long term and clear vision of the institutional market 

at EU level; 

• 

Carry  out  and  update  a  mapping  of  the  supply  chain  to  ensure  the  right  level  of 

European independence, expertise and competitiveness; 

• 

• 

• 

Support the development of appropriate skills required specifically by the space sector 
and promote the establishment of mutually recognised academic space qualifications in 
Europe  (initiate  and  coordinate  between  Member  States  the  development  of  space 
academies); 

Include  in  future  R&D  framework  programmes  dedicated  actions  in  which  part  of  the 
research  must  be  done  by  PhD  candidates  –  as  is  currently  the  case  in  air  traffic 
management; 

Encourage  the  development  of  life  long  learning  programmes  through  strengthened 
cooperation between industry and universities, in particular in the emerging area of satellite 
based applications; 

• 

Enhance EU appeal to foreign researchers. 

1.4. 

Support access of European industry to the global market 

•  Analyse measures and good practices developed by Member States to support access to 

international markets; 

• 

Ensure that the specificities of the space sector and the European space industry are taken 
into  account  in  trade  negotiations  and  relevant  commercial  agreements,  to  foster  a  level 
playing field. 

2. 

SUPPORTING RESEARCH AND INNOVATION 

2.1. 

Enable  European  competitiveness 
dependence in critical technologies and by fostering innovation 

in  space,  notably  by  ensuring  non-

• 

Continue to coordinate the Commission's efforts with those of Member States, ESA and 

EDA in order to identify the critical space components and to ensure their availability; 

• 

Examine  whether  it  is  feasible  to  boost  the  emerging  Earth  observation  market 

through incentives such as long term contracts with Earth observation industry; 

• 

• 

Promote the use of space-based applications in EU policies; 

Support  awareness  raising  campaigns  to  make  possible  users  (cities,  regions,  various 
industrial  sectors,  etc)  aware  of  the  potential  of  space-based  applications,  thus  stimulate 
their needs for such applications and facilitate with ad hoc take up actions (e.g. vouchers for 
local authorities or SMEs) the adoption of new services by the final users;  

EN 

22 

   EN 

 
• 

Support  the  development  of  innovation  support  measures  to  industry  at  EU,  national 
and  regional  level  with  a  specific  focus  on  SMEs  in  the  downstream  satellite-enabled 
services sector; 

• 

Implement the Commission GNSS Action Plan to foster the development and adoption 

of satellite navigation applications using EGNOS and Galileo; 

• 

Support  space  technology  cross-fertilisation  with  other  sectors  and  spin-in/spin-offs  in 

R&D and Innovation programmes. 

2.2. 

Enable advances in space technologies 

• 

• 

• 

Increase space research efforts, in particular in breakthrough technologies; 

Support the development of alternative technologies to those of competitors; 

Promote  R&D  support  to  industry  and  space  research  organisations,  including  the 
downstream  service  sector  and  support  the  development  of  application-oriented  R&D 
programmes  at  universities  related  to  space  technologies  and  promote  the  transition  from 
prototyping to product and market;  

•  Assess  hosted  payloads  business  case,  to  explore  the  potential  for  further  institutional 
and scientific use and identify the best ways to address the challenges ahead such as legal 
issues, government/military requirements, etc; 

•  Assess other cost-effective launch opportunities in order to embark new technologies to 

test them; 

•  Use  Horizon  2020  to  accelerate  the  implementation  of  substitutes  to  raw  materials 
needing replacement such as those listed within the framework of the REACH regulation. 

2.3. 

Stimulate the full exploitation of space data and the development of innovative 
applications 

• 

Ensure  more  extensive  utilisation  of  space  data  from  existing  and  future  European 

missions in the scientific, public and commercial domain. 

3. 

• 

EXPANDING THE ARRAY AND THE USE OF AVAILABLE FINANCIAL INSTRUMENTS 

Explore possibilities to facilitate access to finance, especially by SMEs, by promoting 
the  further  development  of  innovative  financial  instruments  and  the  use  of  the  existing 
instruments; 

• 

Encourage  Member  States  and  regions  to  increase  the  use  of  structural  funds  and 
innovative  financial  instruments  to  promote  the  development  of  innovative  satellite-based 
services by SMEs; 

EN 

23 

   EN 

 
 
• 

Ensure  the  rapid  extension  of  the  scope  of  the  EU  project  bond  initiative  to  space 

infrastructures. 

4. 

MAKING A BETTER USE OF PROCUREMENT POLICY 

•  Develop and provide to industry a long term and clear planning of the institutional 

market; 

•  Analyse the impact of the implementation of the EU Directives on public procurement 

and defence procurement on the national and European space markets;  

• 

For programmes which involve joint funding by both the Commission and ESA, early 
coordination should take place to ensure a smooth transition between the development 
phase and the operational phase. 

5. 

ESTABLISH AND IMPLEMENT A REAL EUROPEAN LAUNCHER POLICY 

• 

Establish in coordination with the other institutional actors a real European launcher 

policy, as is the case in the other space-faring nations. 

6. 

• 

SUPPORT THE SETTING UP AND OPERATION OF A EUROPEAN SST SERVICE 

Provide  an  organisational  framework  (governance)  to  support  the  setting  up  and 
operation of a space surveillance and tracking (SST) service at European level building 
on existing national assets and expertise; define a related data policy taking into account 
national security interests. 

EN 

24 

   EN