By Chris Morris BBC Europe correspondent

The European Union has rejected renewed criticism from the United States over European plans to establish a network of navigational satellites.

We don't like monopolies

EU spokesman

Washington says the proposed EU network, known as Galileo, is unnecessary, because the Americans' own network, the Global Positioning System or GPS, is already widely available.

The US Defense Department has already warned that Galileo could be used by America's enemies.

Now the State Department has weighed in as well - it argues there is no need for a new system. But the EU says it is none of Washington's business.

"We don't like monopolies," a spokesman in Brussels said, adding that the Galileo project appeared to be on the verge of approval.

Chirac warned the EU could become the US's vassal

Navigational satellites have important civilian and military uses.

They can pinpoint accurately the geographic position of any object on Earth. So, they have obvious strategic value.

The Galileo project has been under a cloud, because some EU countries, led by Germany, have raised questions about its commercial viability.

Putting up to 40 satellites in orbit will cost billions of dollars, but there does now seem to be a European consensus that the project should go ahead.

Last year, the French President, Jacques Chirac, said failure to proceed with Galileo would eventually turn the EU into an industrial and economic vassal of the United States.

On both sides of the Atlantic, officials have said they hope the two systems will be compatible with one another - if and when Galileo gets off the ground.