Explanatory Memorandum to COM(2007)535 - Further implementation of the European satellite radionavigation programmes (EGNOS and Galileo) - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2007)535 - Further implementation of the European satellite radionavigation programmes (EGNOS and Galileo). |
|---|---|
| source | COM(2007)535  |
| date | 19-09-2007 |
On 14 July 2004 the Commission adopted a proposal for a Regulation of the European Parliament and of the Council on the implementation of the deployment and commercial operating phases of the European programme of satellite radionavigation i. This proposal had two main objectives.
Firstly, as the Galileo programme had reached an advanced stage of maturity and went well beyond the framework of a simple research programme, it was necessary to place it on a specific legal basis which was consistent with the future European space programme and better able to satisfy its needs and respond to the requirement for sound financial management.
Secondly, this proposal dealt with financing the part of the Galileo programme funded by the Community budget during the 2007-13 financial framework. It also provided for a financial contribution from the European Community of EUR 1 billion for the period from 1 January 2007 to 31 December 2013.
On 21 April 2005 the Council reached an agreement (partial general approach) on the Commission's proposal for a Regulation, with the exception of the budgetary details, with final approval dependant on the outcome of the debate on the 2007-13 financial framework. The main amendment introduced by the Council was to include the EGNOS programme in the proposed Regulation.
Parliament has also examined the text at first reading and on 5 September 2005 gave a generally very positive opinion of it. Like the Council it wished to see the EGNOS programme included in the proposed Regulation.
It should be pointed out that, when the Commission adopted its proposal for a Regulation in July 2004, it was foreseen that the deployment and commercial operating phases of the Galileo programme would be the subject of a private sector concession. The financial contribution from the European Community was, therefore, to be limited to one third of the cost of deployment of the system and to the payment of annual subsidies to the future concessionaire during the first years of operation.
Contents
In the light of the difficulties that arose in the negotiations on the concession contract, the Transport Council of 22 March 2007 asked the Commission to assess all progress made regarding the Galileo project, to propose, as soon as possible, ways of guaranteeing the public financial commitments in the long term, to provide for a scenario for making EGNOS satellite navigation services available in the short term and, lastly, to assess the progress of the concession contract negotiations and to suggest detailed alternative scenarios.
The European Parliament made a similar request in its Resolution adopted on 26 April 2007 i, in particular to improve the public management of the programme by ensuring clear political responsibility and the Commission's leadership role.
The Commission responded to the requests made by Parliament and the Council in the Communication which it adopted on 16 May 2007 i. Firstly, it invited them to take note of the failure of the negotiations on the concession contract, to reaffirm the necessity to put in place an autonomous satellite navigation system and to recognise that, in this respect, the characteristics of the Galileo system remain fully compatible with the ambitions of the European Union. The Commission subsequently made the following main proposals with a view to ensuring the satisfactory continuation of the programme:
- Ensure that the entire Galileo constellation is deployed by the European Community itself; the system may later be operated commercially through a public-private partnership.
- Nominate the European Space Agency as procurement agent for the deployment of the system. The Agency would act on behalf of the European Union, under its authority and by its rules.
- Strengthen and restructure the public governance of the European GNSS programmes by giving the Commission, as representative of the European Community, political responsibility and a leadership role.
- Take immediate action to ensure that EGNOS, which will enter into operation at the start of 2009, can implement its services as a precursor to Galileo.
In May 2007 the Commission stated that the new proposed scenario is the only one which will allow the system established under the Galileo programme to be fully operational by the end of 2012. The political decision-making process currently foresees this date being postponed until mid-2013. It requires a budget commitment of EUR 3.4 billion between 2007 and 2013, i.e. EUR 2.4 billion more that the amount originally stated in the proposal adopted by the Commission on 14 July 2004. This significant increase in the contribution from the Community budget is mainly the result of the European Community assuming responsibility for all aspects of deployment of the system.
Following the Communication from the Commission, the Transport Council adopted a Resolution in June 2007 in which it largely agreed to the Commission's proposals. In particular, the Council:
- concluded that the concession contract negotiations had failed and should be ended;
- invited the Commission to continue with the implementation of a certifiable EGNOS, with the initial service available by 2008;
- reaffirmed the value of Galileo as a key project of the European Union and supported the deployment of the Galileo system by the end of 2012;
- recognised that the implementation of a deployment of Galileo and EGNOS by the public sector would need additional public funding;
- requested the Commission to submit to it by September 2007 detailed proposals for financing, proposals for an implementation and procurement strategy which will have to reflect progress made so far as well as the need for competition, concepts for the role of the private sector in the commercial operating phase, and proposals for a sound public-sector management structure of the programme on the basis of a clear division of responsibilities between the Commission, the European Space Agency, the European GNSS Supervisory Authority, Member States and the Council.
In its Resolution of 20 June 2007 i Parliament also supported the proposals put forward by the Commission in its Communication of 16 May 2007, in particular regarding Community financing for the programmes and the need to improve public governance of them.
The proposals put forward by the Commission to amend its initial proposal for a Regulation reflect the abandonment of the concession plan for the deployment phase, as well as the various comments made by Parliament and the Council.
Firstly, the text now fully incorporates the EGNOS programme and identifies it, alongside Galileo, as one of the two pillars of European satellite radionavigation policy. Both systems and programmes are also clearly defined.
Secondly, the proposed text reflects the abandonment of the concession plan for the deployment phase of the Galileo programme and the fact that all aspects of this phase will be undertaken by the European Community. The budgetary resources needed to finance the two programmes between 1 January 2007 and 31 December 2013 are now EUR 3 405 million. EUR 1 005 million is already foreseen in the existing financial programming (2007-13) under the Commission's proposed legislation for the implementation of the deployment and commercial operating phases of the Galileo programme i. It is proposed to increase the above figure by an additional EUR 2 100 million the allocation of which will be subject to a review of the current financial framework (2007-13). The funds are provided from unused margins in headings 2 and 5 for 2007 and 2008. As a result, the text of the amended proposal shall stipulate that the Community budget for 2007-13 foresee EUR 3 105 million for the European GNSS programmes. A sum of EUR 300 million, which is available for the European GNSS programmes under the Seventh Research and Development Framework Programme i, will help cover these costs.
This amount also covers costs linked to the delays in the development phase of the Galileo programme, which will only be completed in 2010. Lastly, recent studies i carried out by the Commission conclude that the Galileo system is likely to be deployed in mid-2013.
Thirdly, the text allows the commercial operation of the EGNOS system from 2009, with a one-year delay due to ongoing pre-qualification work.
Fourthly, the proposed text aims to improve the public governance of the programmes. Halting the concession contract negotiations left a legal vacuum regarding the role of the Supervisory Authority during the deployment and commercial operating phases of the Galileo programme, as the tasks assigned to the Authority under Regulation (EC) No 1321/2004 i mainly entailed selecting a concession holder. The Commission must therefore put forward a proposal amending Regulation (EC) No 1321/2004 once the European Union has adopted the necessary political decisions, in order to ensure a solid and coherent framework for the public governance of the programmes.
Nevertheless, several measures can already be taken. The proposed text strengthens public governance in two ways:
- by providing for a strict division of responsibilities between the European Community, represented by the Commission, the European GNSS Supervisory Authority and the European Space Agency, and by conferring the implementation of the programmes upon the Commission. The European GNSS Supervisory Authority will, in addition to its core role of facilitating the introduction of the services offered by the systems on commercial markets, assist the Commission in all matters linked to the implementation of the programmes. Technical aspects are the responsibility of the European Space Agency. Contracts concluded by the Agency must comply with relevant Community rules on public contracts;
- by providing for the setting up of the Committee on European GNSS Programmes, which will help the Commission implement this Regulation and ensure the uniform management of the programmes, faster decision-making and equal access to information.
The implementation of these programmes must be accompanied by the establishment of the appropriate components and resources. Amongst other things, the tasks which were to be undertaken by the concession holder must now be carried out by the Commission, with the help of independent experts, experts from the Member States and a specialised team.
In the light of the changes in the course of the Galileo programme since the start of 2007, in particular the fact that the European Community will now assume direct responsibility for the deployment of the system and the resulting additional cost of EUR 2 100 million for the Community budget during the 2007-13 financial framework, it is necessary to amend the proposal for a Regulation which was adopted by the Commission on 14 July 2004 i.