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European Defence Fund: Strengthening the European defence industry and the transatlantic relationship?
AmCham EU is delighted that legislators came to an agreement on the European Defence Fund (EDF) after the third trilogue meeting. With a budget of EUR13 billion from 2021 to 2027, the EU is making its first major contribution to collaborative defence research and capability development. The EDF marks a crucial advancement in strengthening the defence industry in the EU.
By mirroring the hard-won compromise on third-country participation that was achieved in the European Defence Industrial Development Programme (EDIDP), legislators have not only given recognition to the global nature of the sector, but have also managed to reflect conditions found across the Atlantic. As it currently stands, article 10 will allow European companies with third-country parentage, under certain security conditions and located in the EU to participate in EDF actions. The EDF will reaffirm the guiding principle of attaining the best strategic value for money, promote healthy competition and foster the development of interoperable capabilities.
While major achievements have been made to conditions for third-country participation, the EU needs a regulatory framework that provides flexibility in intellectual property rights (IPR). Current IPR restrictions will make it difficult for third-country entities to collaborate in an EDF action and could also pose hurdles to European companies wanting to use their non-EU assets. The EDF should enable the use of best available technology in the development of new capabilities, while sufficiently protecting the IPR of participating companies.
The EDF will strengthen the defence industry in the EU, promote closer collaboration between Member States and increase efficiencies in joint defence projects. But have legislators established a proportionate regulatory framework that will also strengthen the EU’s ties with critical partners?
For any questions, please contact Florian Gleissner, Policy Adviser (FGL@amchameu.eu).