EU sends ultimatum to Galileo consortium

Belgium, 23 March 2007: Galileo consortium companies were given until 10 May to solve their internal disputes or risk losing the project, as otherwise the Commission will consider launching a new call for tender for the EU satellite navigation system.

The EU Transport Council on 22 March 2007 gave the Galileo consortium partners a strict deadline by which the eight companies are expected to solve their internal problems linked to distribution of responsibilities, organisational structure, risk-sharing and pending financial aspects.

If by 10 May 2007 the eight-member consortium has not managed to agree on the legal structure of a single Galileo operating company and appointed its chief executive the Commission "will look at all possible alternatives, including a possible new call for tender", said Transport Commissioner Jacques Barrot. Official signature of the terms of the contract should take place at the latest in September 2007.

"Within the consortium there are diverging interests and there has not been enough effort yet to resolve these. Our pressure has already made the consortium to move a bit but there's still a lot of room for improvement and we want to help build the momentum by setting this short dead-line," said the German Federal Transport Minister Wolfgang Tiefensee.

The Council also mandated the Commission to look at alternative solutions at the same time and asked it present an assessment to the June 2007 Transport Council as to the overall progress of the Galileo project. "By the June Council we will examine the state of play and decide, if appropriate, on whether to continue on the same lines or to seek alternative solutions," said Tiefensee.

Diplomats said that delays are mainly due to Spanish ambitions to get more than it got in the initial agreement for founding the consortium. Asked whether the Council had discussed Spain's role in causing the delay, the Commissioner Barrot only replied that "in order to make Galileo success all member states need to understand that Galileo applications will benefit each of them. If a member state wants to feel immediate benefits in its country, it would be premature and would weaken an undertaking that has to get started and will only bear fruit at a later stage."