Serbia's prosecution on Monday charged a former defence minister with abuse of power for approving a 45-million euros (55.2 million dollars) satellite rental from an Israeli company.

The prosecutor's office said in a statement that Prvoslav Davinic -- at the time a defence minister of the then Serbia-Montenegro's federation -- had been charged with abuse of power for signing the contract with ImageSat company without the necessary authorization.

In 2005 Davinic signed a contract with Israeli's ImageSat for renting a spy satellite in the tense region along the administrative border with breakaway Kosovo.

The contract was never realized and ImageSat sued Serbia for violating it. In 2008, Serbia lost the case before the International Court of Arbitration in Paris and was ordered to pay 36 million euros to the Israeli company.

Last week, the Serbian government appointed a commission for negotiations with the Israelis in a bid to "minimize the damage Serbia sustained after failing to honor the contract and losing a lawsuit."