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Roscosmos says Galileo, other European space programs could suffer from payment dispute

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PARIS — The Russian space agency, Roscosmos, on Oct. 21 gave written warning to the French government that it would take France to court in six months unless France’s Arianespace launch-service company frees up about 300 million euros ($330 million) in long-overdue payments.

In what appears to be an attempt to force France’s European neighbors to apply pressure to Paris, Roscosmos hinted that multiple cooperative space efforts between Russian and the European Union, and with the European Space Agency (ESA), could suffer if the payments are not freed.

The payments, which are not disputed by Arianespace, have been one of the collateral effects of the battle by former shareholders of Russia’s Yukos oil company. In 2014, these shareholders won an initial award of $50 billion from an international arbitration panel in The Hague, Netherlands, against the Russian government for dismantling the company.

Since then, the shareholders have been trying to collect Russian government assets wherever they find a sympathetic legal environment outside Russia, including France and Belgium. In France, different shareholder representatives sought seizure of the Eutelsat and Arianespace payments.

The same dispute has blocked payments to other Russian companies. Paris-based satellite operator Eutelsat owes Russia’s biggest satellite operator, Russian Satellite Communications Co. (RSCC) of Moscow, around $300 million for services related to Eutelsat use of RSCC satellites.

That money too has been blocked but is not part of the latest Roscosmos action, perhaps because RSCC, while owned by the Russian government, is viewed as a private company.

In a letter sent to the office of French Prime Minister Manuel Valls, Roscosmos Deputy Director-General Sergey Savelyev said Russia’s work with all European governments could suffer.

Widening the dispute to ESA and the EU

“Roscosmos works in close collaboration with numerous countries, including France,” Savelyev said, according to an Oct. 24 statement published on Roscosmos’ behalf by Hamas Paris. “The seizure of payments due by Arianespace to Roscosmos for work on numerous projects, including Galileo, complicates future cooperation on these programs and on other space programs of the European Union.

“Roscosmos has always conducted an efficient and mutually beneficial cooperation with the EU and with the European Space Agency. We and our partners obviously hope to put this misunderstanding behind us as soon as possible to resume our cooperation.”

Evry, France-based Arianespace, which is not owned by the French government, purchases medium-lift Soyuz rockets from Russian manufacturers through a contract with Roscosmos.

The Europeanized Soyuz is operated by Arianespace alongside the heavy-lift Ariane 5 rocket and the Italian-led Vega small-satellite launcher.

Soyuz has notably been used to launch European government satellites, and has been the work-horse rocket for deployment of Europe’s Galileo positioning, navigation and timing satellite constellation.

The European Commission, which is the executive arm of the 28-nation European Union, owns Galileo. Concerned about over-relying on a single vehicle, the commission has purchased several Ariane 5 rockets to launch the Galileo satellites.

The first of these Ariane 5 launches for Galileo is scheduled for mid-November.

Bringing ESA into the legal dispute over Yukos payments will raise inevitable questions of what programs beyond Galileo might be held hostage to the unblocking of the Roscosmos funds.

Potential problem for ExoMars?

The most visible of the bilateral ESA-Roscosmos programs is ExoMars. Russia’s role includes providing two heavy-lift Proton rockets for the ExoMars missions. The first launched in 2016 and the second is scheduled for launch in 2020 — assuming that both ESA and Roscosmos can find the necessary financing for the program.

ESA governments are expected to decide on ExoMars funding in December.

Roscosmos is invoking a 1989 bilateral investment security treaty with France. It says its Oct. 21 letter sets in motion a six-month deadline for the dispute’s resolution, after which Roscosmos will take France to court for violating the treaty.

SpaceNews.com

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Roscosmos says Galileo, other European space programs could suffer from payment dispute

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