Wednesday 13 December 2017

British firms 'pushed out' of satellite deals by EU

Criticism: Philip Davies
Criticism: Philip Davies

Laura Hughes in London

The European Commission is working to "push" British companies out of contracts for the latest phase of work on the EU's Galileo satellite navigation system, according to reports.

The body is understood to be calling for the right to cancel existing contracts if a supplier is no longer based in a European Union member state.

The total cost of the latest project is €10bn and managed by the European Space Agency.

The 'Financial Times' reported that the commission is demanding that any company kicked out of the programme should be asked to finance the cost of finding a replacement supplier.

"It feels like the UK is being targeted. We have been fighting to stay involved in Galileo whereas some European partners are working to push us out," a UK government official said.

The majority of Galileo's existing satellites have been provided by the UK's Surrey Satellite Technology, majority owned by France-based Airbus.

British companies with interests in the project include Qinetiq, CGI, Airbus and Scisys.

Responding to the news, Tory MP Philip Davies said: "This is more evidence that the EU is an inward-facing, backward-looking protection designed to protect inefficient EU businesses and French farmers.

"That is why an outward-looking, international, free-market country like the UK does not belong there."

Andrew Rosindell MP added: "The EU is now clearly pursuing a project punishment strategy against the UK. It's a foolhardy way to go for an institution that is rapidly losing credibility amongst the peoples of Europe.

"Britain will very soon not be a member of the EU, but Europe will need the UK's involvement and co-operation in the future, in all kinds of ways. So, in the end the EU will be cutting its own nose off if it keeps sticking the knife into Britain like this."

To retain access to Galileo after Brexit, the British government will need to negotiate a new security relationship with the EU.

Under the new terms being called for by the commission, contracts for the project could be cancelled any time after 2019, just after Brexit.

A senior executive from a UK-based space systems company said: "We may be forced to consider withdrawing from our UK market operations."

Another said: "We will be looking at .  .  .  who is best placed to participate. If you have the option not to do work from the UK this gives you a reason to think that is safer."

A commission spokesman said that "similar" termination clauses have been standard since 2003, and insisted that the new clause was "not prepared in view of Brexit".

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