The EU has Reached a Preliminary Agreement on the Defense Budget until 2027
The EU institutions have reached a partial political agreement on the European Defense Fund, which will contribute to the strategic autonomy of the Community, the European Commission said.
The agreement reached affects the possibility for the Fund to provide support for industrial development - from research, prototype development to certification of defense products. The Fund will support collaborative research projects free of charge. Research and design will be able to receive up to 100 percent funding. The EU budget will co-finance the cost of developing prototypes by up to 20 per cent. Testing, grading and certification will have budget support of up to 80 per cent.
The fund will support projects from companies from different EU countries. If eligible, projects will be eligible for additional funding of 10%. Projects will be defined in accordance with defense objectives agreed by EU countries within the framework of the Common Foreign and Security Policy. Regional and international priorities, for example within NATO, may also be taken into account, the report says.
Only joint projects involving at least three eligible participants from at least three EU or Associated Countries will be able to use these opportunities. At least four and at most eight percent of the budget will be earmarked to strengthen the EU's long-term position in technology in the long term and defense autonomy.
Only actors established in the EU or Associated States which, moreover, do not control foreign countries or legal entities from foreign countries are eligible for funding. Subsidiaries in the EU of companies from foreign countries will, exceptionally, be eligible for funding under certain conditions, so as not to jeopardize the EU's security and defense interests.
Entities established outside the EU will not receive funding but may participate in cooperation projects. In this way, the EU does not exclude anyone from using the resources of the European Defense Fund but sets conditions for receiving funding similar to those with which EU companies face foreign markets.
The agreement reached has yet to be formally approved by the European Parliament and the Council of the EU. The European Defense Fund will complement other EU programs with a budget of € 6.5 billion to improve the strategic transport infrastructure so that it meets NATO requirements as well as the proposed new research agenda.
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