3rd Dec 2022

European Parliament approves opening of defence market

  • Defence equipment should be purchased more freely and with better coordination among EU member states. (Photo: SHAPE)

The EU moved one step closer to a single market in the area of defence on Tuesday (16 December), with the European Parliament approving a commission proposal aimed at harmonising and simplifying national rules in this area.

"Today's approval brings us a decisive step forward towards setting up a true European defence equipment market," Guenter Verheugen, EU commissioner responsible for enterprise and industry and one of the initiators of this directive said after the vote.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

The current Nice treaty provides that internal market rules are not applied to the defence market, allowing member states to exclude defence contracts from EU procurement rules.

Moreover, 27 national licensing procedures make transfers of defence material between countries difficult, as they differ in terms of requirements. The licensing rules also apply to the export of defence related products such as spare parts or even army boots.

Applying heterogeneous and disproportionate national licensing systems is hampering the security of supply between member states and costs businesses over €400 million a year, a commission statement reads.

The proposal drafted by German green MEP Heide Ruhle and endorsed by the plenum on Tuesday provides a European system of licences which will be uniform and applicable throughout the 27 member states. Licences will nonetheless be granted at the national level, with governments still free to impose sanctions if the contractor fails to respect the licensing conditions.

The parliament also added some extra provisions to guarantee the security of transfers, notably with respect to the final recipients of products or components, in order to ensure that arms do not reach conflict zones.

The market fragmentation was also a problem identified in the recently reviewed EU security strategy, endorsed by heads of states and governments at their 11-12 December meeting.

"Restructuring of the European defence technological and industrial base, in particular around centres of European excellence, avoiding duplication, in order to ensure its soundness and its competitiveness, is a strategic and economic necessity. In this connection, the European Council calls for early finalisation of the Directives on intra-Community transfer of defence goods and on defence procurement," the summit conclusions read.

Strategy for French political reasons

While the directive was a "step in the right direction", it was still "a long way from having an EU market for defence equipment", with national procurement rules still remaining "very defensive", Giles Merritt, head of a Brussels based think tank on security and defence, the Security and Defence Agenda, told EUobserver.

Mr Merritt also pointed out that the reviewed security strategy endorsed by member states was not designed as a "great milestone", but rather to confirm the approach of the last five years.

He called for a "new budgeting mechanism for burden sharing", since at the moment Great Britain and France were not only contributing with most troops to EU missions, but also paying for the costs of the missions.

He was sympathetic to the idea floated by some EU officials that the security strategy could have waited one year longer, after US president Barack Obama was sworn in and the NATO 60 anniversary summit would have taken place in Strasbourg/Kehl.

"Practical politics must have driven them into doing it during the French presidency," Mr Merritt said.

Brussels moves to open EU defence industry market

The European Commission has proposed a package of measures to open up the European defence industry market, designed to increase the efficiency of Europe's defence spending and ultimately to boost military capabilities.

MEPs back opening of market in defence goods

The European Parliament threw its weight on Wednesday behind a draft bill aimed at making public procurements for defence goods and services more transparent and open.


EU must break Orbán's veto on a tax rate for multinationals

This global tax rate for multinationals could yield up to €64bn annually. Yet, the Hungarian government led by Viktor Orbán has been blocking it for months. The impotency of the EU to strike a deal is irresponsible and incomprehensible.

Turkey's EU-funded detention centres ripe with abuse: NGO

Afghan and Syrian nationals are being abused at EU-funded removal centres in Turkey amid a lack of proper monitoring, says Human Rights Watch. The findings come at a time when Turkey is deporting large numbers of Afghans back to Kabul.

Portugal was poised to scrap 'Golden Visas' - why didn't it?

Over the last 10 years, Portugal has given 1,470 golden visas to people originating from countries whose tax-transparency practices the EU finds problematic. But unlike common practice in other EU states with similar programmes, Portugal has not implemented "due diligence".

Stakeholders' Highlights

  1. Nordic Council of MinistersCOP27: Food systems transformation for climate action
  2. Nordic Council of MinistersThe Nordic Region and the African Union urge the COP27 to talk about gender equality
  3. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  4. Friedrich Naumann Foundation European DialogueGender x Geopolitics: Shaping an Inclusive Foreign Security Policy for Europe
  5. Obama FoundationThe Obama Foundation Opens Applications for its Leaders Program in Europe
  6. EFBWW – EFBH – FETBBA lot more needs to be done to better protect construction workers from asbestos

Latest News

  1. EU must break Orbán's veto on a tax rate for multinationals
  2. Belarus dictator's family loves EU luxuries, flight data shows
  3. How Berlin and Paris sold-out the EU corporate due diligence law
  4. Turkey's EU-funded detention centres ripe with abuse: NGO
  5. In green subsidy race, EU should not imitate US
  6. EU Commission proposes suspending billions to Hungary
  7. EU: Russian assets to be returned in case of peace treaty
  8. Frontex leadership candidates grilled by MEPs

Stakeholders' Highlights

  1. European Committee of the RegionsRe-Watch EURegions Week 2022
  2. UNESDA - Soft Drinks EuropeCall for EU action – SMEs in the beverage industry call for fairer access to recycled material
  3. Nordic Council of MinistersNordic prime ministers: “We will deepen co-operation on defence”
  4. EFBWW – EFBH – FETBBConstruction workers can check wages and working conditions in 36 countries
  5. Nordic Council of MinistersNordic and Canadian ministers join forces to combat harmful content online
  6. European Centre for Press and Media FreedomEuropean Anti-SLAPP Conference 2022

Join EUobserver

Support quality EU news

Join us