JOHANNESBURG — The European Union’s General Court has annulled the European Defence Agency’s (EDA) decision to award a 250 million euro ($291 million), four-year satellite communications framework contract to Telespazio France, finding that the company’s bid should have been rejected for failing to meet mandatory tender requirements. The contract itself was not annulled.

In a July 1 judgment published in the EU’s Official Journal on Aug. 17, the court ordered EDA, the European organization that coordinates defense across member nations, to pay Airbus Defence and Space and Marlink Events, the consortium partners behind a rejected bid that brought the case against the agency, a combined 4.32 million euros in damages. That amount represents an estimation of profit the contract would have provided. 

The ruling was based on the court’s assessment that the consortium would have had a 95% chance of winning the 2023 contract over Telespazio, had the procurement been handled correctly, as Telespazio’s original bid didn’t meet specific requirements.

While the ruling annuls the decision, the subsequent signing of the framework agreement was not invalidated, meaning the contract remains in force and the agency can continue placing orders with Telespazio under it. The disconnect stems from the fact that, once signed, the framework became a separate contractual relationship between EDA and Telespazio that could not be undone through the same legal challenge to the procurement decision. The practical consequence for EDA is the 4.3 million euros in damages to be paid and a formal judicial finding of serious procurement failings by the agency. 

In response to a request for comment from SpaceNews, an EDA spokesperson said the agency is evaluating how to respond to the judgment.

“The Agency is taking all necessary measures to ensure diligent compliance with the court decision, while giving due consideration to the critical operational impact that an abrupt disruption of service would entail,” the spokesperson said, “The Agency remains engaged in evaluating all judicial remedies available to it.”

The agency declined to comment on whether it has continued placing new orders with Telespazio since the judgment or whether it’s considering terminating or re-tendering the contract.

Both Airbus and Telespazio declined to comment on the matter, with a Telespazio spokesperson telling SpaceNews that the matter “is still ongoing.” Marlink did not respond to a request for comment.

EDA’s largest joint procurement project

The disputed contract forms part of EDA’s EU SatCom Market program, which provides commercially available satellite communications to European governments and EU institutions. The program is separate from, but complementary to, the EU’s GOVSATCOM initiative, which pools secure governmental satellite capacity for many of the same public sector users.

EDA has described its EU SatCom Market as the agency’s “largest joint procurement project.” Under the program, EDA awarded the first framework contract in 2012 to Astrium Services, which later became part of Airbus Defence and Space. Airbus Defence and Space secured the next contract in 2016 and the third was awarded to an Airbus-Marlink consortium in 2020.

EDA launched the procurement process for a fourth satellite communications framework, the one named in the court decision, in March 2023. The call covered services in the C, Ku, commercial Ka, L and UHF bands, as well as military Ka- and X-band equipment and associated services. The only two bids came from Telespazio France and from a consortium made up of Airbus Defence and Space and Marlink.

EDA’s evaluation committee completed its report on Dec. 4, 2023, and the agency selected Telespazio eight days later.

Airbus challenged the outcome during the 10-day standstill period before the contract was signed, raising concerns about whether Telespazio’s offer complied with the tender requirements. In response, the agency suspended the signing of the framework on Jan. 8, 2024 while it reviewed those concerns.

On Jan. 23, EDA confirmed the outcome of the review and lifted the suspension. The following day, it decided to proceed with signing the framework agreement with Telespazio. Airbus and Marlink responded by filing their case against EDA with the General Court of the European Union on Feb. 21.

An ‘inexcusable’ decision

In its July 1 ruling, the General Court declared that EDA had wrongly accepted Telespazio’s bid despite it not meeting mandatory requirements. The requirements called for the company to provide written evidence that it had contracts with satellite operators that would allow it to deliver the services it was offering. The court found that Telespazio had failed to provide that required evidence and that EDA had improperly given the company an opportunity to rectify the omission months after the Sept. 18 deadline for submitting bids had come and gone.

In its ruling, the court concluded that EDA should not have allowed Telespazio to complete its bid after the submission deadline had passed. As the requirements were mandatory, the court explained that EDA had no discretion to accept a non-compliant offer, describing the decision as “inexcusable.”

The court also upheld two other complaints raised by Airbus and Marlink, funding additional problems with EDA’s evaluation of Telespazio’s bid and its handling of a request for information by the consortium following the award.

In the complaint, Airbus had sought approximately 21.65 euros million in damages and Marlink approximately 2.55 million euros for loss of opportunity. The court, however, argued that damages should instead be calculated on the expected profits the two companies would reasonably have expected to earn. 

Based on confidential information provided to the court by EDA showing how much Telespazio had already invoiced under the framework by November 2025, the court estimated that Airbus and Marlink could have expected around €65 million in purchases over the four-year term, well below the €250 million ceiling. Applying a 7% estimated net profit margin, the court awarded the pair a combined €4,322,500 in damages (€3,864,315 to Airbus and €458,185 to Marlink). The split reflected the distribution of work proposed by the two companies.

What happens now

Roberto Caranta, a professor of administrative law at the University of Turin and an expert in EU public procurement law, told SpaceNews that the award of any damages reflected the seriousness of EDA’s actions.

“For damages to be awarded, a serious and manifest breach is necessary. If the mistakes of EDA had been excusable, there would not have been any liability.”

Despite this, the legal consequences for the underlying contract are limited. EDA will be left to absorb the financial and reputational fallout while the framework itself remains in force. That may not be the end of the legal process, however — Caranta added that he expects the agency to appeal the judgment.

Related