Berlin and Paris have decided to shut down the long-running Future Combat Air System program, a project aimed at developing a next-generation fighter jet, Reuters reported, citing sources in the German government.

According to the agency, German Chancellor Friedrich Merz and French President Emmanuel Macron agreed to close the project during a meeting on the sidelines of the EU-Western Balkans summit in Montenegro. The decision followed prolonged disputes between European aerospace group Airbus and France’s Dassault Aviation.

Reuters noted that the companies failed to reach an agreement on how work under the program should be divided and who would hold patent rights to the technologies being developed. Back in May, Airbus CEO Guillaume Faury said the FCAS project no longer matched current realities and needed to be reviewed.

With the program set to be abandoned, Dassault plans to continue developing France’s Rafale fighter. Airbus, meanwhile, may explore other partnership options, including cooperation with Sweden’s Saab, the maker of the Gripen, or with participants in the GCAP program, under which Italy, the United Kingdom and Japan are working on a sixth-generation fighter jet.

At the same time, one Reuters source said Germany and France do not intend to end every FCAS-related effort. The leaders of the two countries agreed to preserve work on the shared architecture of the FCAS Combat Cloud, a system designed to connect manned aircraft and drones into a single network.

The German and French defense ministries are expected to prepare further plans and several joint weapons projects. These are due to be presented at the Franco-German Council of Ministers, scheduled for mid-July.

Berlin’s interest in the GCAP program was previously reported by Corriere della Sera. In February, the newspaper wrote, citing sources, that Germany was considering joining the joint project by Rome, London and Tokyo to create a new combat aircraft.

The Future Combat Air System program was launched in 2017. Its goal was to develop a combat aircraft that could eventually replace France’s Rafale jets, as well as the Eurofighter aircraft operated by Germany and Spain.