MEPs approve European Defense Industrial Development Program

European Parliament approved, on 3 July, a proposal to establish a European Defense Industrial Development Program (EDIDP). With a €500 million budget for 2019-2020, this first-ever EU defense industry fund will help the development of new and upgraded products and technologies to make the EU more independent, make budget spending more efficient and stimulate innovation in defense.

For the next long-term EU budget 2021-2027, a European Defense Fund of €13 billion has been proposed to fund military development and research activities, while a €90 million research test program for 2017-2019 has already been started.

“This first European program specifically dedicated to defense industrial projects will increase cooperation and strengthen the competitiveness of the EU defense industry,” said Rapporteur Françoise Grossetête (EPP,FR).

Who can apply?

EU will co-fund projects implemented by consortia of at least three public or private companies established in at least three different EU Member States.

To win contracts, project backers will need to prove that they contribute to excellence, innovation and competitiveness. Projects specifically dedicated to SMEs and Mid-Caps (firms with up to 3,000 employees) will be eligible for higher co-financing rates, as well as actions within the PESCO framework.

What can be funded?

European Defense Industrial Development Program will fund the development phase (between research and production) of new and upgraded defense products and technologies in the EU, from studies, through design, testing and up to certification and development phases in areas such as:

• remotely piloted systems,

• satellite communications,

• autonomous access to space and permanent earth observation,

• energy sustainability,

• cyber and maritime security,

• high-end military air, land and sea capabilities, and

• joint domain systems, including strategic enablers.

Program can be seen as the pilot of the next European Defence Fund, which - with a proposed budget of €13 billion over 7 years- aims to make the EU more independent in the area of defense through cooperation, whilst promoting more efficient use of tax-payers money.

Next steps

Informal deal between Parliament and Council was backed by the full House by 478 votes to 179, with 23 abstentions. Once the Council has given its green light, the regulation will enter into force upon publication in the EU Official Journal. First capability projects are expected to be financed in 2019.

Source:RRA, European Parliament Press Room.Translated by Miruna Matei