The EU’s new Defence Fund launches its first calls, with the ambition to strengthen Europe’s strategic autonomy in defence-related technologies.
The European Commission has adopted the first European Defence Fund (EDF) annual work programme and launched 23 calls for proposals for a total of €1.2 billion of EU funding. The EDF, ratified by the European Parliament and the European Council earlier this year (see SwissCore article), will support the competitiveness and innovation capacity of the European defence industry by funding collaborative defence research and development projects. Financing will go to high-end defence capability projects, such as the next generation of aircraft fighters, tanks or ships, as well as critical defence technologies such as military cloud, artificial intelligence, semiconductors, space, cyber, and medical countermeasures.
In order to kick-start large-scale capability development projects and cover a broad range of priorities, the 2021 EDF budget of €930 million has been complemented with a ‘top-up’ of €290 million from the 2022 EDF budget. Furthermore, in an effort to broaden participation and tap into promising SMEs and start-ups, some calls are dedicated to small and medium-sized enterprises (SMEs).
The overarching objective of the EDF is to complement the defence research and development investments of member states, reduce the fragmentation of the EU defence capabilities by incentivizing transnational cooperation, and improve the interoperability of products and technologies. In this first year of the programme, the EDF will allocate around €700 million to the preparation of large-scale defence platforms and systems such as next generation fighter systems or ground vehicles fleet, digital and modular ships, and ballistic missile defence. Around €100 million will be dedicated to technologies critical to the performance and resilience of defence equipment, with a focus on artificial intelligence and cloud for military operations, as well as semiconductors in the field of infrared and radiofrequency components.
The EDF will also develop synergies with other civilian EU policies and programmes, notably with Horizon Europe and Digital Europe Programme. A further €120 million will be allocated to disruptive technologies and specific open calls for SMEs, fostering innovations in areas such as quantum technologies, additive manufacturing and over the horizon radar.
Eligibility for funding is limited to entities based in EU member states and associated members of the European Economic Area (EEA). Restrictions apply to those entities effectively controlled by a non-associated third country entity: they can participate, if it is deemed necessary for achieving the objectives of the action, and on the condition that their participation will not put at risk the security interests of the Union and its Member States. Beneficiaries and their subcontractors may also cooperate with entities established in a non-associated third country (with similar security restrictions), although the costs related to such cooperation shall not be eligible under the EDF.
The EDF constitutes an important stepping-stone for EU strategic autonomy, with a budget of €7.953 billion in current prices over the next 7 years. One third of this budget will finance competitive and collaborative research projects, in particular through grants, and two-thirds will complement Member States’ investment by co-financing the costs for defence capabilities development following the research stage.
The EDF precursor programmes were the European Defence Industrial Development Programme (EDIDP), with €500 million for 2019-2020, and the Preparatory Action on Defence Research (PADR), which had a budget of €90 million for 2017-2019. The PADR covered the research phase of defence products, including disruptive technologies, while EDIDP has supported collaborative projects related to development, including design and prototyping. As a sign of the strong involvement of SMEs going forward, the EDIDP 2020 calls dedicated 30% of funding to SMEs, which also constituted 35% of beneficiary entities.