U.K. to EU: Time Is Running Out for Deal on Galileo Satellites

(Bloomberg) -- Time is running out for the European Union to compromise with the U.K. over its continued participation in the bloc’s Galileo satellite navigation program, Science Minister Sam Gyimah said.

The EU has effectively ruled out British companies bidding on new contracts for the 10 billion-euro ($11.6 billion) program, and also says it will exclude Britain from the Public Regulated Service -- the encrypted navigation signals used for government and defense purposes. That’s despite U.K. units of Airbus SE and CGI Group Inc. carrying out extensive work on the program since its inception.

“We are not yet past the point of no return, but time is running out,” Gyimah told a House of Lords Committee on Thursday. “We’ve also made it clear that any gap in U.K. involvement in the design and development of Galileo, the PRS, would also mean the U.K. could not rely on the system for our own national security interests.”

Galileo has become one of the surprise flash-points of Britain’s negotiations to leave the EU, and emphasizes the gap in negotiating stances. The EU is sticking to its rulebook, which says Britain should be treated as any other third nation after Brexit, while British officials argue the country’s close involvement in the program to date means it should have privileged access.

‘For the Birds’

“A charitable interpretation of their actions would be that they are adopting an overly legalistic stance,” Gyimah said, adding that “industrial interests” may also feed into it. He said if the European Commission is being “rational,” it will allow Britain to remain fully involved, adding “if it’s a politically driven decision, it’s a much more difficult call.”

Britain has said that it’ll work on its own satellite array -- possibly in conjunction with countries such as Australia -- if it can’t have the access it wants to the EU program. At the same time, ministers have taken offense at the idea the U.K. can’t be trusted to stay involved in the secure signal program.

“The very idea that somehow the U.K. cannot be trusted on security matters is for the birds,” Gyimah said.

In its most detailed proposal yet on the post-Brexit economic relationship with the EU, the U.K. reiterated on Friday that it wants to remain part of the program, and said its exclusion could jeopardize European security.

“The EU has put forward proposals which have the effect of ending U.K. participation,” the so-called White Paper says. “An end to close U.K. participation would be to the detriment of Europe’s prosperity and security.”

To contact the reporter on this story: Alex Morales in London at amorales2@bloomberg.net

To contact the editors responsible for this story: Flavia Krause-Jackson at fjackson@bloomberg.net, Thomas Penny, Stuart Biggs

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