It could cost the EU dearly as it wants to charge high-tech firms "licence fees" to access that same data, before they can make and sell compatible navigation devices to the public.

But the European Commission told the Telegraph last night that Mr Cornell's success in cracking codes for the prototype was irrelevant, as final codes for the Galileo system would not only be different, but would be made available by the EU.

Galileo is a joint project of the European Union, the European Space Agency and of private investors.

It is Europe's rival to the US military Global Positioning System (GPS), which is free for all worldwide as long as you purchase a receiver yourself.

Galileo, on the other hand, must make money to reimburse its investors by charging a fee for the codes that the Galileo satellites send out.

Galileo's founders have continuously claimed that it would be more accurate than GPS and so people would want to pay to use it.

The first satellite, named GIOVE-A, was sent into orbit in December last year as a prototype for the 30 satellites that by 2010 will compose Galileo.

In mid-January, Mr Psiaki, professor of mechanical and aerospace engineering at Cornell University and co-leader of Cornell's GPS Laboratory, asked for the prototype codes but without luck.

Three months later he and his group of scientists had cracked the codes "just with an antenna and lots of signal processing," and with a basic algorithm to extract the codes.

Galileo is intended to pay for itself by offering several services, from a basic signal for use by the public to highly encrypted signals for governments and armed forces.