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OPINION (COM(2025)0188 – C100070/2025 – 2025/0103(COD))

On the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) 2021/694, (EU) 2021/695, (EU) 2021/697, (EU) 2021/1153, (EU) 2023/1525 and 2024/795, as regards incentivising defence-related investments in the EU budget to implement the ReArm Europe Plan

SEDE-AD-774466

Committee on Security and Defence · Rapporteur: Thijs Reuten

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This committee opinion proposes amendments to EU regulations to incentivise defence-related investments under the ReArm Europe Plan. It focuses on the European Defence Fund, Digital Europe Programme, and Connecting Europe Facility, while not amending STEP or ASAP regulations. The amendments aim to better include Ukraine and associated countries, prioritise capability gaps, support SMEs, and enhance resilience against hybrid threats and military mobility.

Committee position. The Committee on Security and Defence proposes amendments to the Commission proposal, focusing on the European Defence Fund, Digital Europe Programme, and Connecting Europe Facility, while not amending STEP and ASAP regulations.

Key points

  1. Calls for increased Union defence spending and a change of mindsets, referencing the Joint White Paper for European Defence Readiness 2030 and NATO commitments.
  2. Proposes to add a fourth strategic sector on defence and security technologies to STEP, including AI Gigafactories.
  3. In the European Defence Fund, proposes to open participation to Ukraine and countries with Security and Defence Partnerships, and to prioritise projects delivering short-to-medium term results.
  4. Increases funding rates for SMEs and mid-caps, and adds bonuses for large consortia and Ukrainian participation.
  5. In the Digital Europe Programme, extends objectives to counter hybrid warfare, includes armed forces as public sector, and allows restrictions to be eased for EEA and Ukraine.
  6. In the Connecting Europe Facility, mainstreams counter-mobility measures and supports repair of critical infrastructure, with preference for Eastern flank projects.
  7. Deletes amendments to the ASAP regulation, as it is no longer necessary with the adoption of EDIP.

Who is affected

  • SMEs and mid-caps in the defence industry benefit from higher funding rates and increased support.
  • Ukraine and associated countries gain access to the European Defence Fund and eased restrictions in Digital Europe.
  • Armed forces are included as public sector in Digital Europe, enabling support for defence-related digital projects.
  • Member states on the Eastern flank receive priority for CEF projects enhancing strategic connectivity.

Figures and deadlines

  • Funding rate for SME consortia in EDF activities may be up to 40% of eligible costs.
  • Funding rate for SME consortia in certain EDF activities may be up to 100% of eligible costs.
  • Increased funding rate requires at least 25% of eligible costs allocated to SMEs, up from 10%.
  • Additional 10 percentage points for mid-caps requires at least 25% of eligible costs, up from 15%.
  • Additional 2.5 percentage points for large consortia with wider geographical participation.
  • Additional 10 percentage points for actions with Ukrainian participation or in support of Ukraine's defence.