European Parliament and Council Reach Agreement on Strengthening Security and Defence Investments

EU Lawmakers Approve Major Boost to Defence Funding

November 6, 2025

Brussels – European Union officials have informally agreed to a plan that will substantially increase funding allocated to defence-related initiatives. The agreement, reached on Wednesday evening, centers on redirecting financial resources from established EU programs to bolster the European Defence Technological and Industrial Base (EDTIB).

The revised financial framework will draw from programs including the Strategic Technologies for Europe Platform (STEP), Horizon Europe, the European Defence Fund (EDF), the Digital Europe Program (DEP), and the Connecting Europe Facility (CEF). These funds will be strategically channeled to support defence projects and enhance security capabilities across the Union.

Focus on Resilience and Cyber Security

During rigorous negotiations, Members of the European Parliament (meps) successfully advocated for expanding the scope of the initiative to encompass broader resilience measures. these include strengthening the protection of critical infrastructure, enhancing disaster response capabilities, and safeguarding the integrity of electoral processes. A key focus was also placed on improving the Union’s defences against escalating Cyber threats targeting key digital infrastructure.

Support for Ukraine‘s Defence Industry

A noteworthy outcome of the agreement is the inclusion of provisions for greater support for Ukraine’s defence sector. Lawmakers secured Ukraine’s participation in the European Defence Fund, enabling it to directly benefit from EU funding and collaborative projects. This demonstrates a strong commitment to bolstering Ukraine’s security in the face of ongoing geopolitical challenges.

Dual-Use Technology and Strategic Sectors

The Horizon Europe program will now incorporate support for technologies with both civilian and military applications – frequently enough referred to as “dual use” – furthering innovation in areas relevant to both sectors. Furthermore, “defence technologies” have been officially designated as a fourth strategic sector under the Strategic Technologies for Europe Platform (STEP), prioritizing investment in this critical area. Initial funding will be directed towards Small and Medium-sized Enterprises (SMEs), including start-ups and smaller mid-sized companies.

Infrastructure and Military Mobility

The Connecting Europe Facility (CEF) will also be leveraged to fund dual-use transport infrastructure. This includes establishing military mobility corridors to facilitate the rapid deployment of resources and personnel when needed.The European Commission will have the authority to set requirements related to the origin of equipment and supplies utilized in these projects.

“With this agreement, Parliament and Council have done their job. Now it’s over to the Member States and the Commission to act – the tools are on the table, and the opportunities can be used,” stated Richard Kols, a lead MEP from Latvia.

Kols emphasized that this agreement signifies a basic shift in how the EU approaches defence investment, highlighting its seriousness and setting a precedent for future, more enterprising proposals. He expressed confidence in Parliament’s continued commitment to building upon this momentum.

Next Steps and Implementation

The informal agreement now requires formal endorsement from both the European Parliament and the Council to become law. The Industry, Research and Energy committee is scheduled to vote on the text on November 20th, with a full parliamentary vote expected before the end of the year.

Background: ReArm Europe Plan

The initiative stems from a proposal by the European Commission in April 2025, under the “ReArm Europe” plan, designed to increase defence investments within the existing EU budget. Responding to increased global instability, the plan seeks to strengthen the European Defence Technological and Industrial base in alignment with the Joint White Paper for European Defence Readiness 2030. This reflects a broader strategic objective to enhance the EU’s autonomy and competitiveness in the defence sector.

Program	Primary Focus	Key Changes
STEP	Strategic Technologies	Adds “Defence Technologies” as a fourth key sector.
Horizon Europe	Civil & Military Applications	Supports “dual-use” technologies.
EDF	Defence Research & Growth	Includes Ukraine’s participation.
CEF	Infrastructure	Funds dual-use transport infrastructure (military mobility).

Did You Know? According to a recent report by the European Defence Agency, EU member states increased their collective defence spending by 8% in 2024, signalling a growing recognition of the need for enhanced security capabilities.

Pro Tip: Keeping abreast of EU legislative developments related to defence is crucial for businesses and organizations operating within the European security sector.

What impact will this funding increase have on the European defence industry? How will these investments enhance the EU’s overall strategic autonomy?

Understanding the European Defence Fund

The European Defence Fund (EDF) is a key instrument designed to support collaborative defence research and development projects across EU member states. Established in 2019, it aims to boost European technological sovereignty and reduce reliance on non-EU suppliers.the EDF operates on a co-financing basis, requiring contributions from both the EU budget and national governments. It supports a wide range of activities, including basic research, prototype development, and capability exhibition.

The recent expansion of the EDF to include Ukraine underscores its growing importance as a tool for strengthening regional security. By facilitating collaboration and innovation, the EDF aims to create a more resilient and competitive european defence ecosystem.

Frequently Asked Questions

• What is the primary goal of the EU defence funding increase? The primary goal is to strengthen the European Defence Technological and Industrial Base (EDTIB) and enhance the EU’s security capabilities.
• Which programs are contributing funds to this initiative? The programs contributing funds are STEP,Horizon Europe,EDF,DEP,and CEF.
• How does this agreement support Ukraine? Ukraine will now be able to participate in the European Defence Fund, receiving funding and collaboration opportunities.
• What is meant by “dual-use” technology? Dual-use technology refers to technologies that have both civilian and military applications.
• What are military mobility corridors? These are infrastructure routes designed to facilitate the rapid deployment of military personnel and equipment when needed.
• What is the next step in the legislative process? the agreement must be formally endorsed by the European Parliament and the Council.
• What is the ReArm Europe plan? The ReArm Europe plan is an initiative by the European Commission to boost defence investments within the EU budget.

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How will the increased funding of the European Defence Fund (€8 billion) from 2025-2027 specifically impact the development of AI for defence applications?

The Landmark Deal: Boosting European Defence Capabilities

On November 6th, 2025, the European Parliament and the Council of the European Union have reached a pivotal agreement aimed at significantly bolstering security and defence investments across the bloc. This deal,years in the making,represents a major step towards greater european strategic autonomy and a more robust response to evolving geopolitical challenges. The agreement focuses on implementing the European Defence Fund (EDF) and the Military Mobility initiative, key components of the broader Permanent Structured Cooperation (PESCO) framework.

Key Provisions of the Agreement

The finalized agreement encompasses several crucial elements designed to streamline and amplify defence spending:

* Increased Funding: The EDF will receive a ample budget of €8 billion for the period 2025-2027, dedicated to collaborative research and development of next-generation defence technologies. This represents a significant increase compared to previous funding levels.

* Simplified Rules: Bureaucratic hurdles for accessing EDF funding have been reduced, making it easier for companies – particularly SMEs – to participate in joint projects. This simplification is expected to accelerate innovation.

* military Mobility Enhancement: The agreement prioritizes improving military mobility across Europe,focusing on removing logistical bottlenecks and upgrading transport infrastructure. This includes streamlining cross-border transport regulations and investing in dual-use infrastructure (roads, railways, ports) capable of supporting both civilian and military needs.

* Focus on Strategic technologies: Funding will be directed towards critical areas such as:

* Artificial intelligence (AI) for defence applications

* Cybersecurity and facts warfare capabilities

* Next-generation materials and manufacturing

* Space-based assets for security and surveillance

* innovative defence technologies like directed energy weapons and advanced robotics.

* Third-Party Participation: The agreement outlines conditions for participation by non-EU countries in specific projects, fostering international collaboration while safeguarding European interests.

the European Defence Fund (EDF): A Deep Dive

The EDF is the cornerstone of this new initiative. It operates on a co-financing model, requiring contributions from both the EU budget and individual member states.

* EDF Structure: The fund is divided into three main strands:

1. Research: Supports early-stage research into disruptive defence technologies.
2. Development: Funds the prototyping and testing of new defence systems.
3. Deployment: Aims to facilitate the uptake and deployment of innovative technologies by European armed forces.

* Eligibility Criteria: Companies of all sizes, research institutions, and universities across the EU are eligible to apply for EDF funding. Priority is given to collaborative projects involving participants from at least three different member states.

* Impact on SMEs: The agreement includes specific measures to encourage SME participation, such as dedicated funding streams and simplified request procedures.This is crucial for fostering a vibrant and competitive European defence industrial base.

Military Mobility: Connecting European Forces

Enhancing military mobility is vital for the EU’s ability to respond effectively to crises and defend its interests. The agreement focuses on:

* Removing Roadblocks: Addressing legal and administrative barriers to cross-border military transport.

* Infrastructure Investment: Upgrading key transport infrastructure,including roads,railways,bridges,and ports,to meet military requirements.

* Harmonization of Regulations: Standardizing regulations related to military vehicle weights, dimensions, and escorts.

* Digitalization: Implementing digital tools for real-time tracking and management of military transport.

Benefits of Increased defence Investment

The agreement is expected to yield a range of benefits for the EU and its member states:

* Enhanced Security: A stronger European defence capability will contribute to the security of the EU and its citizens.

* Economic Growth: Increased defence spending will stimulate economic growth and create jobs in the defence industry.

* Technological Leadership: The EDF will foster innovation and help Europe maintain its technological edge in key defence areas.

* Strategic autonomy: greater defence independence will reduce Europe’s reliance on external actors and enhance its ability to act autonomously in pursuit of its interests.

* NATO Interoperability: The agreement is designed to complement, not duplicate, NATO efforts, and will enhance interoperability between european and NATO forces.

Real-World Examples & Case Studies

Several ongoing PESCO projects already demonstrate the potential of collaborative European defence initiatives.For example:

* European Patrol Corvette (EPC): A joint project led by Italy, France, Spain, and Greece to develop a new generation of patrol corvettes.

* Military Mobility Hubs: Several member states are establishing dedicated military mobility hubs to facilitate the rapid deployment of forces and equipment.

* Cyber Rapid Response Teams: Collaborative efforts to develop and deploy cyber rapid response teams to counter cyberattacks.

These projects showcase the benefits of pooling resources and expertise to achieve common security goals.

Implications for the Defence Industry

The agreement will have significant implications for the European defence industry:

* Increased Opportunities: Companies will have access to increased funding opportunities through the EDF.

* Greater Collaboration: The emphasis on collaborative projects will encourage companies to forge partnerships across borders.

* Focus on Innovation: The EDF will incentivize companies to invest in research and development of cutting-edge technologies.

* Competition: increased competition for EDF funding will drive innovation and efficiency.

Navigating the New Landscape: Practical