First-ever EU defence industry fund: MEPs and ministers strike informal deal
- EU’s defence “strategic autonomy” to be achieved by fostering efficiency and innovation
- €500 million to develop defence products and technologies
- Excellence, innovation and competitiveness as key contract award criteria
The new European Defence Industrial Development Programme, with a €500 million budget for 2019-2020, was informally agreed by MEPs and Council on Tuesday night.
EU financial aid will help fund the development of new and upgraded products and technologies to make the EU more independent, make budget spending more efficient and spur innovation in defence.
Who can apply?
To be eligible for funding:
- companies need to be part of a consortium of at least three public or private companies, established in at least three different EU member states,
- at least three of the eligible companies, established in at least two different member states, must not be controlled, directly or indirectly, by the same entity or by each other,
- beneficiaries and their subcontractors must be public or private companies established in the EU, and
- their infrastructure, facilities, assets and resources, including their executive management structures, used for the funded actions will have to be located in the EU throughout duration of the action and must also be established in the EU.
What can be funded?
The European Defence Industrial Development Programme will fund the development phase (between research and production) of new and upgraded defence products and technologies in the EU, from studies, to design, testing and up to certification and development phases.
Selection and work programme
To win contracts, project backers will need to prove their contribution to excellence, innovation and competitiveness.
The EU Commission would adopt a two-year work programme detailing the procedures for selecting actions for EU support, the type of financing and the budget allocated, as well as the categories of projects that can be funded, including projects specifically dedicated to SMEs.
Independent experts, whose credentials need to be validated by member states, will assist the Commission in the award procedure. These experts will be EU nationals from as broad a range of EU countries as possible. The Commission will assure a balanced composition and an appropriate rotation.
Rapporteur Françoise Grossetête (EPP, FR) said: “This first European programme specifically dedicated to defence industrial projects will increase cooperation and strengthen the competitiveness of the EU defence industry. The all-European defence technological and industrial base, in particular our SMEs, will benefit from this programme in order to strengthen our strategic autonomy. Excellence and innovation will be key to selecting projects.”
The provisional deal will be presented to EU ambassadors for their endorsement on 29 May, after which it needs to be approved by Parliament’s Industry Committee before being put to a vote by Parliament as a whole. Once the full House and Council have formally approved the regulation, it will enter into force upon publication in the EU Official Journal.