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New Deal for European Defence

24 June 2014
by eub2 -- last modified 26 June 2014

The European Commission has presented on 24 June a roadmap for measures to strengthen the Single Market for defence, to promote a more competitive defence industry and to foster synergies between civil and military research including details and timelines for the actions.

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These actions include preparing a roadmap for a comprehensive EU-wide security of supply regime; practical guidance for regional authorities and SMEs clarifying the possibility of using European funds for supporting dual-use projects; and a new 'Preparatory Action' to test the added value of an EU contribution to defence-related research for the Common Security and Defence Policy (CSDP). Taken together, these actions will contribute to making the European defence and security sector more efficient and strengthen the Union's CSDP.

Single Market

To ensure a firm foundation for the competitiveness of Europe's defence industrial base it is essential that there is a strong Single Market for defence. With this objective in mind, the Commission has agreed to undertake the following actions:

  • Market Monitoring – analyse the impact of the Defence Procurement Directive 2009/81/EC through assessment of procurement opportunities published on the EU's Tenders Electronic Daily (TED) and other public sources.
  • Clarification of exclusions from the Defence Procurement Directive – issue guidance notes to help Member States use these exclusions correctly in the areas of Government-to-Government sales and International Agreements/Organisations.
  • Offsets – identify and fight unjustified discriminatory requirements in procurement. In parallel, the Commission will look together with Member States and industry at ways of promoting cross-border market access for SMEs by non-discriminatory means. To that end, the establishment of an ad hoc Advisory Group is envisaged.
  • Security of Supply
  • develop a roadmap for establishing an EU-wide Security of Supply Regime to be presented to the European Council in June 2015.
  • propose measures to strengthen the implementation of the Defence Transfers Directive 2009/43 (introducing a licensing system to help movement of defence-related products within the EU) in a report to be prepared for June 2016.
  • issue a Green Paper, by the end of 2014, on the control of defence and security industrial and technological assets.

Competitiveness

In addition to the Single Market there are areas of industrial policy that can support competitiveness of the defence industry. In particular the Commission will undertake actions on:

  • Standardisation and Certification- work closely with the European Defence Agency (EDA) to develop new defence standards in Europe and, with the European Aviation Safety Agency, to support the EDA in the harmonisation of military airworthiness requirements.
  • Raw Materials - screen raw materials critical for the defence sector and identify by mid-2015 whether any policy actions are required in support of Europe's defence industry's continued access to essential raw materials.
  • SMEs, clusters & regions
  • use the Enterprise Europe Network and other programmes to support SMEs and defence-related regions to network and identify new business opportunities inside and outside the EU.
  • clarify conditions under which the European Structural and Investment Funds can be used to support dual-use projects.
  • with the Association of Regional Development Agencies (EURADA) and the EDA, raise awareness of funding opportunities for regions and SMEs with targeted events (next in November 2014); a guidebook; and developing a network of regions interested in fostering defence-related industrial activities.
  • Skills - prepare a communication campaign on EU-funding of skill-related initiatives and launch a study, in 2015, on current and future competencies and skill supply and demand for the defence sector.

Research and Innovation

Falling national investment in defence R&D is a long-term threat to the competitiveness of Europe's defence industry. Therefore the Commission will take action on the following:

  • Dual-use research - maximise synergies between European civil (within the limits allowed by the civil focus of the Horizon 2020 research programme) and military research co-ordinated by the EDA.
  • Preparatory Action – will be developed to illustrate the added-value of an EU contribution to CSDP-related research. A 'Group of Personalities' could be established to advise the Commission on issues relating to the scope and operation of such an Action.

Capabilities

While the issue of military capabilities is primarily for Member States the Commission can provide support through:

  • A joint assessment with the European External Action Service (EEAS) and the EDA of dual-use capability needs - for both EU security and defence policies to identify potential synergies.
  • Other projects – A Communication planned for 8 July 2014 will set out a roadmap for implementing the 'Common Information Sharing Environment (CISE) for the EU maritime domain. The Commission is also working with the EDA to identify areas for further civil / military co-operation.

Space

The Commission believes that there are potential benefits in terms of reduced costs and greater efficiency to be gained from increased synergies between national and European space capabilities. In this regard the Commission will:

  • Space Surveillance and Tracking (SST) – the Commission will, through the Horizon 2020 research programme, look at ways of encouraging the development and renewal of SST assets.
  • Satellite Communication (SATCOM) – use a user-group established with the European Space agency, EDA and the EEAS to tackle the fragmentation of demand for security SATCOM to support Member States to prepare the next generation of Governmental SATCOM.

Energy

The Commission aims to support the EU's armed forces in reducing their energy use for their own benefit and to make an important contribution to the EU's energy targets. In particular the Commission will launch the:

  • Consultation Forum for Energy in the Defence and Security Sector– it will provide a platform for energy experts to discuss and advise energy policies in defence. Its main deliverables will be to develop specific guidance for the military on existing EU legislation and programmes governing energy efficiency and renewables; and to develop concepts for improving the protection of critical energy infrastructures.

International issues

With shrinking domestic demand, exports to third country markets have become increasingly important for Europe's defence industry. Within the limits of its competence, the Commission will undertake the following actions:

  • Competitiveness on third country markets – establish a forum in the 4th quarter of 2014 to discuss with Member States and stakeholders how to support Europe's defence industry on third country markets.
  • Dual-use export control – following the adoption of its Communication, on 24 April 2014, setting out the outcome of its review of export control policy, it will now conduct an impact assessment of the various review options identified in the Communication.

Background

The strategic and geopolitical environment is constantly evolving. The world's balance of power is shifting as new centres of gravity are emerging and the US is rebalancing its strategic focus towards Asia. In this situation, Europe has to assume greater responsibilities for its security at home and abroad. The Union therefore needs a credible Common Security and Defence Policy (CSDP), underpinned by a competitive defence industry and efficient defence market structures.

Defence industry is not only of strategic importance for Europe's security, it also plays a crucial role in the wider European economy. Its cutting-edge research has created important indirect effects in other sectors, such as electronics, space and civil aviation and provides growth and thousands of highly skilled jobs.

Armed forces all over the world are increasingly relying on assets that have their origins in civil technologies and applications. A stronger interaction between the civil and military sectors can act as a driver for more innovation and give a boost to the overall economic development of Member States. This underlines the need to further stimulate civ-mil synergies, which is in fact the thread running through the Commission's proposals.

These proposals were set out in a Commission Communication adopted in July 2013 (IP/13/734 and MEMO/13/722). It set out a series of proposals to strengthen the Internal Market for defence, reinforce the competitiveness of the European defence industry and support defence research. This Communication was discussed at the European Council in December 2013 as part of its debate on ways to strengthen the CSDP. It welcomed the Communication in this context and decided to review progress in June 2015. The roadmap adopted by the Commission details modalities and timelines for the actions set out in the Communication, taking account of European Council conclusions.

Further information: defence procurement