(STRASBOURG) - Europe's long-delayed Galileo satellite navigation system passed its final legal hurdle on Wednesday after the European Parliament gave the flag-ship project its green light.

In an almost unanimous vote, members of the European Parliament set in stone the legal basis for the system, which has been plagued in the past by technical problems and infighting among EU nations, at a plenary session in Strasbourg.

Transport Commissioner Jacques Barrot said the EU's executive arm and the European Space Agency would launch the public tender process "by the summer" in the hope that first contracts could be signed before the end of 2008.

The 3.4-billion euro (5.4-billion dollar) budget will be divided into six segments with contracts for satellites, launchers, computer programmes, ground stations, control stations and the system's operation.

The 30-satellite European project is meant to challenge the dominance of the US-built Global Positioning System (GPS), which is widely used in navigation devices in vehicles and ships. The EU aims to have up in space by 2013.

The EU's Slovenian presidency welcomed Wednesday's vote, hailing it as "a decisive step forwards" in the EU's quest to establish its own satellite navigation system.

"We are sending a clear signal to Europe and the whole world that we are still firmly committed to providing every citizen and enterprise in Europe with a high-quality satellite navigation service by 2013," Slovenian Transport Minister Radovan Zerjav said in a statement.

"New jobs will be created and Europe will claim its rightful place alongside the technologically most developed world powers."

Work on the scheme, already running five years behind the initial schedule, slowed drastically last year as cost over-runs piled up, private contractors bickered and member states lobbied for their own industrial interests.

Meanwhile the US military has been working on super-powerful updates to its GPS technology to try to trump Galileo before it even gets in the air, according to military experts there.

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