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Galileo, a niche satellite technology programme,  has escalated to the top of the Brexit political agenda as  Britain and the EU  wrangle over access to it.  There is a thrilling  tension as the two have become locked in an  inter-governmental conflict overhung by industrial threats, against a  backdrop   of  science-fiction-like  technologies. Galileo symbolises the power of space communications for economic and security policy. And now the EU has signalled a red light to  Britain’s key demand for full access to a next-generation encrypted service.  

This analysis considers the EU’s new space programme proposals against Britains demands for inclusion in Galileo’s secure PRS service. It draws on the EU Proposal for a Regulation establishing the space programme  and the British government’s Technical Note: UK Participation in Galileo, with additional input from the just-released EU slides on space-related activities.

 The EU’s announcement of a €16 billion investment in a post-2020 space strategy, puts into sharp relief the dispute with Britain over the Galileo satellite programme. The EU is thinking strategically to develop commercial and government applications, aiming to establish itself as a global leader in space. Britain is putting national security first in a move that  seeks a deal to get full access Galileo’s encrypted service, with full participation of British firms,  whilst apparently brushing off non-security elements. However, in a set of slides prepared for a Council of Ministers meeting this week, the EU has shown in a traffic-lights coloured chart how British demands don’t fit with the EU rules for third-country participation.

Galileo is the European rival to the GPS  (United States) and GLONASS (Russia) satellite navigation systems. The EU Space Programme post-2020, announced this week, positions Galileo as one of three major programmes being funded  between now and 2027. Galileo will benefit from a $9.7 billion budget allocation from 2021-2027.  The other two are the Copernicus earth observation programme, and a new satellite-based secure communications system for government use. The  EU wants a ‘flourishing’ of   commercial and government applications. It is looking for  a €63 billion benefit to EU industry over a 20 year period, with up to an additional €45 billion in indirect benefits that would flow from a downstream exploitation of the system. According to its Impact Assessment,  it sees the space programme as a key facilitator for other public policy objectives. 

The EU has proposed  a new piece of EU legislation that underpins the space strategy and makes some changes to the governance structure of the Galileo programme and seeks to strengthen EU interests in the European Space Agency (ESA). This is the Proposal for a Regulation establishing the space programme of the Union and the European Union Agency for the Space Programme (6.06.2018).

The proposed Regulation seeks to  “fully finance” Galileo and will be  “the owner of all tangible and intangible assets” (Article9).   The  Agency that currently manages Galileo – the GNSS Agency -  is being upgraded to be responsible for supporting development of  commercial applications. It will be re-named the European Union Agency for the Space Programme.

The proposed legislation  states that Galileo is a key strategic asset from a security perspective and it is tightening up on the security accreditiation to the programme, as well as access to sensitive information (Recitals 32-37).  It seeks to restructure its arrangements with the European Space Agency (Recital 29) and seeks full autonomy over its space programmes  in order to protect the EU against interference from third countries (Article7) .  Interestingly in the Brexit context, it includes  a provision to specifically exclude third countries from the decision-making process:

Article 7.2(c) (c) does not confer to the third country or international organisation a decisional power on the programme;

So where does this put Britain? An increasingly heated  dispute  has flared up  between Britain and the European Union over Britain’s post-Brexit access to Galileo.  Britain is under threat of being squeezed out of the Galileo  programme due to certain provisions in the EU Withdrawal Agreement (Article 123 and 122 7(b) coloured version ).

The direct effect of these Transition provisions has been that British representatives will be excluded from the governng bodies and committees of the Galileo programme. In particular, Britain will be excluded from all partipation in the encrypted Public Regulated Services (PRS), including  PRS technical development and will lose rights to use the service when it comes on stream in 2020.   A knock-on effect is that the ability for British-based  to bid for new Galileo contracts, or even to complete work on existing contracts,  is thrown into jeopardy.

There is a real concern that British industry will lose out.  Airbus, a Dutch-controlled corporation and  major contractor for Galileo,  has told the House of Commons Exiting the EU Select Committee that bids for contracts after March 2019 would have to be led by firms based inside the EU27:   

Effectively that means that for Airbus to bid and win that work we will effectively novate all of the work from the UK to our factories in France and Germany on day one of that contract,”  said Colin Paynter, Managing Director, Airbus Defence and Space UK, when he appeared before the Committee on  9 May 2018. 

The British government  is unhappy with that situation, although it is actually hoisted on its own petard (Galileo satellites illuminate EU-UK divorce tensions ). It is now trying to negotiate its way back in. Britain wants to stay in Galileo and  will pay for it.

The  government has laid out its position in a document with the  unremarkable label of ‘Technical Note: UK Participation in Galileo’ issued at the end of May.  Contrary to what it might seem, this document is more than a mere ‘technical’ note.  It makes the case for ongoing British participation in Galileo, stressing how much the British expertise has contributed. It suggests that British exclusion  or withdrawal from the programme would increase system costs for the remaining participants, whilst issuing a gentle reminder that some of the sensor stations are hosted on British overseas territories.

However, according to this Technical Note, the British government  is only interested in the secure PRS service, and has excluded itself from participation in non-security committees and working groups.

It has called for Galileo to be  a core  component of a future EU -UK Security partnership (Technical Note 10, 18,). The big ‘ask’ is for full access to the military-grade Public Regulated Service (PRS) system that Galileo satellites will deliver. This includes being  involved in its design and development at all stages, and  a seat at the table  on the committees that take decisions on PRS, with full access to information (S.22 and S.31). This would include the GNSS Security Board and technical working groups. Underlying concerns appear to be about control of critical technologies remaining in British hands (S.10) (S.16). Although unstated, this could include intellectual property rights (IPR). 

Tied in with the security objective, is a demand the re-admission of British tenders for contracts on both military and civilian applications.  This demand has been underscored by a letter from the Science Minister, Sam Gyimah, to the EU Internal Market Commissioner Elżbieta Bieńkowska, as reported by the Financial Times. He is understood to have asked  her to support the postponment of a new procurement round, in order to win time for British involvement to be discussed further.  His request appears to have been unsuccessful according to The Guardian.

The proposed new EU Regulation leaves open the way for Britain to negotiate its way back in (Article 7.1(b).  However, a number of new agreements  will need to be in place. There will have to be a   Security of Information Agreement, a  Satellite Navigation Cooperation Agreement, and an Agreement on Access to PRS. (See Galileo satellites illuminate EU-UK divorce tensions ) This was confirmed  by the European Commission in  its presentation on security and defence from January 2018.

These agreements could all sit under the umbrella of the Security Partnership.  However, it might take some time to negotiate this Partnership.  Talks  have only just begun, according to a Home Office official speaking to a  House of Lords Select Committee on the European Union,  Home Affairs Sub-Committee, on 15 May this year:

“Internal security, so far, has involved little more than an hour’s discussion with Task Force 50, where we presented a version of the slides that were published last week, and it presented some slides that it had  published in January. We were really setting out our starting positions,  with a view to further negotiations in more detail, and probably at a more  technical level, over the next few months.”  

All of this wrangling  highlights a tension between national and corporate interests.  International corporations can move staff and facilities to protect their own revenue streams, but the national interest should be about the strategic long term well-being of the country.

The British are presenting  their long-term interests for space policy in terms of national security  and military technology. This is in marked contrast to the EU’s big picture vision.  Britain did have, and arguably still has, a  Space Action Plan aiming at a £30 billion space industry by 2030. However, it would seem that in order to get a ` Brexit deal, the British government is less concerned about the civilian applications which will form the other plank to achieve that long term industrial goal. Some experts think that Britain's industrial success could be threatened by exclusion from Galileo projects ( See also Ground control to Mrs May – have we lost the signal? ) .    Despite this, it is notable that the government’s Technical Note  does not ask for access to  the civilian applications of Galileo. Moreover, it effectively discounted them, saying that it does not envisage “attendance at non-security programme meetings”  or “any representation at non-security meetings and bodies” in the GNSS Agency that runs the Galileo programme (S20 (a) and 20(b)). 

However, the EU slides released this week, indicate that Britain will struggle to get its desired security deal. Using  traffic-light colours, the EU highlights in red how third countries – which Britain will be after March next year – may not participate in the deisgn and development of the PRS system, and how third-country industry may only participate in a limited way a a sub-contractor. Third-country firms may not manufacture the PRS security modules. The slides state Britain’s demands go “beyond standard third-country status”.  The slides further state that “design and development of the secure encrypted PRS service”, together with upstream activities, will be reserved for EU Member States, although with a specific agreement, UK firms may be able to manufacture PRS receivers.

It looks like Britain will be scrambling hard to put Galileo at the centre of a new security partnership.

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Contact me if you would like to discuss any of the  issues raised  (Via Contact Us page or Twitter @Iptegrity).

For new Iptegrity  readers, I have been analysing EU policy for over 10 years ( see 10 years of Internet wars ), and have considerable experience of interpreting EU documents, which are sometimes quite opaque. I also have over 25 years' experience of the telecoms and technology sectors, and I have enormous respect for satellite engineers who do an amazing job.

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Iptegrity.com is the website of Dr Monica Horten. She is  a trainer & consultant on Internet governance policy, published author& Visiting Fellow at the London School of Economics & Political Science. She served as an independent expert on the Council of Europe Committee on  Internet freedom. She has worked on CoE, EU and UNDP funded projects in eastern Europe and beyond.  She was shortlisted for The Guardian Open Internet Poll 2012. Iptegrity  offers expert insights into Internet policy (and now Brexit). Iptegrity has a core readership in the Brussels policy community, and has been cited in the media. Please acknowledge Iptegrity when you cite or link.  For more, see IP politics with integrity

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