Regulation (EU) 2025/2643 of the European Parliament and of the Council of 16 December 2025 establishing the European Defence Industry Programme and a framework of measures to ensure the timely availability and supply of defence products (‘EDIP Regulation’) (Text with EEA relevance)

Type Regulation
Publication 2025-12-16
Last updated 2026-04-15
State In force
Department Council of the European Union, European Parliament
Source EUR-Lex
articles 86
Reform history JSON API
Alternative, combined and cumulative funding
1.

The Ukraine Support Instrument shall be implemented in synergy with other Union programmes. An action that has received a contribution from another Union programme may also receive a contribution under the Ukraine Support Instrument, provided that those contributions do not cover the same costs. The rules of the relevant Union programme shall apply to the corresponding contribution, or a single set of rules of any of the contributing Union programmes may be applied to all contributions and a single legal commitment may be concluded. The cumulative support from the Union budget shall not exceed the total eligible costs of the action and may be calculated on a pro-rata basis in accordance with the documents setting out the conditions for support.

2.

In order to be awarded a Seal of Excellence under the Ukraine Support Instrument, actions shall meet all of the following conditions:

(a) have been assessed in a call for proposals under the Ukraine Support Instrument;

(b) comply with the minimum quality requirements of that call for proposals;

(c) not be financed under that call for proposals due to budgetary constraints.

3.

In accordance with the relevant provisions of Regulation (EU) 2021/1060, the ERDF or ESF+ may support proposals submitted further to a call for proposals under the Ukraine Support Instrument which were awarded a Seal of Excellence.

Article 25
Implementation and forms of Union funding
1.

The Ukraine Support Instrument shall be implemented under direct management in accordance with the Financial Regulation or under indirect management with entities referred to in Article 62(1), point (c), of the Financial Regulation.

2.

Without prejudice to Article 33(3) of this Regulation, Union funding may be provided in any of the forms laid down in the Financial Regulation in accordance with its Title X, with the exception of blending operations under the InvestEU programme.

3.

With respect to activities referred to in Article 12(1), point (d), of this Regulation for which Union funding is provided in the form of a grant under the Ukraine Support Instrument and a profit is made, the Commission shall be entitled to recover the percentage of the profit corresponding to the Union contribution to the eligible costs actually incurred by the beneficiary carrying out the action, up to the final amount of the Union contribution. By way of derogation from Article 195(2) of the Financial Regulation, the profit shall be calculated by a surplus of receipts over the eligible costs of the action, where receipts are limited to Union funding, Member State funding, including procurement, other revenue generated during the action and any revenue resulting from the action. The work programmes referred to in Article 34 of this Regulation may set out further details.

4.

By way of derogation from Article 196(2) of the Financial Regulation, financial contributions may, where relevant and necessary for the implementation of an action, cover actions started and costs incurred prior to the date of the submission of the proposal for those actions, provided that those actions did not start before 5 March 2024 and have not been completed before the signature of the grant agreement.

Article 26
1.

Only legal entities established in the Union or in Ukraine and having their executive management structures in the Union or in Ukraine shall be eligible to be recipients of Union funding under this Regulation.

Legal entities established in the non-government controlled areas of Ukraine shall not be eligible for funding under this Regulation.

2.

The eligibility criteria set out in paragraphs 3 to 9 of this Article shall apply in addition to the criteria set out in accordance with the Financial Regulation.

3.

The infrastructure, facilities, assets and resources of the recipients of Union funding involved in an action which are used for the purposes of that action shall be located on the territory of a Member State or of Ukraine for the entire duration of the action.

4.

By way of derogation from paragraph 3 of this Article, where recipients of Union funding involved in an action have no readily available alternatives or relevant infrastructure, facilities, assets and resources in the Union or in Ukraine, they may use their infrastructure, facilities, assets or resources which are located or held outside the territory of the Member States or in a third country other than Ukraine, provided that such use does not contravene the security and defence interests of the Union and its Member States, including respect for the principle of good neighbourly relations, and is consistent with the objectives set out in Article 22. The costs related to activities using such infrastructure, facilities, assets or resources shall not be eligible for support from the Ukraine Support Instrument.

5.

For the purposes of an action supported by the Ukraine Support Instrument, the recipients of Union funding shall not be subject to control by a non-associated third country other than Ukraine or by another third-country entity.

6.

By way of derogation from paragraph 5 of this Article, a legal entity established in the Union and controlled by a non-associated third country other than Ukraine or by another third-country entity shall be eligible to be a recipient of Union funding if guarantees approved in accordance with the national procedures of a Member State in which it is established, such as adequate measures pursuant to screening, as defined in Article 2, point (3), of Regulation (EU) 2019/452, are made available to the Commission.

The guarantees referred to in the first subparagraph of this paragraph shall provide assurances that the involvement in an action of a legal entity as referred to in that subparagraph would not contravene the security and defence interests of the Union and its Member States as established in the framework of the CFSP pursuant to Title V of the TEU, including respect for the principle of good neighbourly relations, or the objectives set out in Article 22 of this Regulation. Those guarantees shall in particular substantiate that, for the purposes of an action, measures are in place to ensure that:

(a) control over the legal entity is not exercised in a manner that restrains or restricts its ability to carry out the action and to deliver results, that imposes restrictions concerning its infrastructure, facilities, assets, resources, intellectual property or know-how needed for the purposes of the action, or that undermines its capabilities and standards necessary to carry out the action;

(b) access by a non-associated third country other than Ukraine or by another third-country entity to classified or sensitive information relating to the action is prevented and the employees or other persons involved in the action have national security clearance issued by a Member State, an associated country or Ukraine, where appropriate, in accordance with national laws and regulations;

(c) the ownership of intellectual property arising from actions referred to in Article 27(1), point (b), relating to industrial reinforcement actions fostering industrialisation and commercialisation of defence products that have been developed in the framework of actions funded by the Union or other cooperative activities conducted with support of Member States, is not subject to restriction by a non-associated third country other than Ukraine or by another third-country entity nor transferred to entities established outside the territory of the Member States, of associated countries or of Ukraine, without the approval of the Member State or the associated country in which the legal entity is established or, where the legal entity is established in Ukraine, the approval of Ukraine. Such approval shall not contravene the objectives set out in Article 22.

If considered to be appropriate by the Member State in which the legal entity is established, additional guarantees may be provided.

The Commission shall inform the committee referred to in Article 77 of any legal entity considered to be eligible to be a recipient of Union funding in accordance with this paragraph.

7.

The guarantees referred to in paragraph 6 of this Article may be based on a standardised template provided by the Commission, assisted by the committee referred to in Article 77, in order to ensure a harmonised approach throughout the Union.

8.

When carrying out an eligible action, recipients may also cooperate with legal entities established outside the territory of the Member States or of Ukraine, or controlled by a non-associated third country other than Ukraine or by another third-country entity, including by using the assets, infrastructure, facilities and resources of such legal entities, provided that such use does not contravene the security and defence interests of the Union and its Member States, including respect for the principle of good neighbourly relations, or the objectives set out in Article 22.

There shall be no unauthorised access by a non-associated third country other than Ukraine or by another third-country entity to classified information relating to the carrying-out of the action, and potential negative effects on the security of supply of inputs critical to the action shall be avoided.

The costs related to cooperation with legal entities established outside the territory of the Member States or of Ukraine, or controlled by a non-associated third country other than Ukraine or by another third-country entity, shall not be eligible for support from the Ukraine Support Instrument.

9.

Paragraphs 5 and 6 shall not apply to:

(a) contracting authorities of Member States and Ukraine;

(b) international organisations;

(c) SEAPs;

(d) the EDA.

SECTION 2

ELIGIBLE ACTIONS

Article 27
Eligible actions
1.

Actions eligible for funding under the Ukraine Support Instrument shall implement the objectives set out in Article 22 and may take one of the following forms, or a combination thereof:

(a) common procurement actions as referred to in Article 11, including for the purpose of establishing, managing or maintaining defence industrial readiness pools;

(b) industrial reinforcement actions as referred to in Article 12;

(c) supporting actions as referred to in Article 13.

2.

The following actions shall not be eligible for funding under the Ukraine Support Instrument:

(a) actions related to defence products that are prohibited by applicable international law;

(b) actions related to lethal autonomous systems that operate outside a responsible chain of human command and control or that cannot be used in compliance with international humanitarian law;

(c) actions related to cluster munitions;

(d) actions, or parts thereof, that are already fully financed from other public or private sources.

3.

For procurement carried out pursuant to paragraph 1, points (a) and (c), which is supported by Union funding, the cost of components originating outside the Union and Ukraine shall not be higher than 35 % of the estimated cost of the components of the end product. No component shall be sourced from third countries that contravene the security and defence interests of the Union and its Member States.

4.

For actions carried out pursuant to paragraph 1, point (b), the cost of components originating outside the Union and Ukraine shall not be higher than 35 % of the estimated cost of the components of the product the increase in production capacity of which is supported by Union funding. No component of the product the increase in production capacity of which is supported by Union funding shall be sourced from third countries that contravene the security and defence interests of the Union and its Member States.

5.

Recipients of Union funding or, where relevant, contractors shall have the ability to decide, without restrictions imposed by non-associated third countries other than Ukraine or by another third-country entities, on the definition, adaptation and evolution of the design of the defence products concerned, including the legal authority to substitute or remove components that are subject to restrictions imposed by non-associated third countries other than Ukraine or by another third-country entities.

6.

Without prejudice to Article 5 of Directive 2009/43/EC, Member States may publish general transfer licences for transfer to other Member States of products related to actions supported by the Ukraine Support Instrument.

7.

Actions eligible for funding under the Ukraine Support Instrument shall be carried out by, or with the involvement of, at a minimum, Ukraine or one legal entity established and having its executive management structure in Ukraine.

8.

For the purposes of this Chapter, references to Member States in Articles 11, 12, 13 and 38 shall be understood to include Ukraine. References to associated countries in Articles 11, 12, 13 and 38 shall not apply to this Chapter. For the purposes of this Chapter, references to Article 9 contained in Article 11 shall be understood to refer to Article 26 and references to Article 10(5) contained in Article 12 shall be understood to refer to paragraph 5 of this Article.

SECTION 3

PROCUREMENT

Article 28
Procurement with support by the Commission
1.

By way of derogation from Article 168(2), second subparagraph, of the Financial Regulation, Ukraine may request, together with at least one Member State, the Commission to engage in joint procurement as referred to in Article 168(2) of the Financial Regulation, whereby Member States and Ukraine may acquire, rent or lease fully the defence products jointly procured. The other conditions set out in Article 168(2) of the Financial Regulation shall apply to such joint procurement.

2.

By way of derogation from Article 168(3) of the Financial Regulation, Ukraine may request, together with at least one Member State, the Commission to act as a central purchasing body as referred to in Article 168(3) of the Financial Regulation to procure defence products on their behalf or in their name. Conditions equivalent to those set out in Article 168(3) of the Financial Regulation shall apply wherever the Commission acts as a central purchasing body.

3.

When requesting the Commission to act in accordance with paragraph 1 of this Article, Member States’ contracting authorities shall be deemed to have complied with the requirements laid down in Directive 2009/81/EC.

4.

In addition to the conditions set out in the Financial Regulation, the procurement procedure referred to in paragraphs 1 and 2 of this Article shall also comply with the following conditions:

(a) participation in the procurement procedure is open to all Member States;

(b) the Commission invites at least one expert with experience relevant to the negotiations from each participating country to form a joint negotiation team;

(c) participating countries explicitly state whether they decide to run parallel negotiation processes for the product concerned, with that decision being subject to unanimous approval by participating countries.

5.

Where the Commission acts as a central purchasing body pursuant to paragraph 2, it may, as part of the procurement, procure components and raw materials necessary for the supply of defence products for the purpose of building strategic reserves by participating countries, including stockpiling.

6.

Where duly justified by the extreme urgency of the situation, the Commission may, by way of derogation from Article 175(1) of the Financial Regulation, request the delivery of products from the date on which the draft contracts resulting from the procurement carried out for the purposes of this Regulation are sent.

7.

In order to enter into purchase agreements with economic operators, representatives of the Commission, or experts nominated by the Commission, may carry out on-site visits in cooperation with relevant national authorities at the locations of production facilities of relevant defence products.

8.

This Article shall be without prejudice to existing Union and national rules governing the ownership, export and transfer of defence products.

9.

The Commission shall ensure that participating countries are treated equally when carrying out the procurement procedures and when implementing the resulting agreements.

10.

In addition to the conditions set out in the Financial Regulation, criteria equivalent to those laid down in Article 26(1), (3) and (4) of this Regulation shall also apply to tenderers, contractors and subcontractors in contracts resulting from the procurement conducted pursuant to this Article.

11.

For procurement conducted pursuant to paragraph 1 of this Article, the rules set out in Article 27(3) and (5) shall apply.

Article 29
Advance purchase of defence products
1.

Joint procurement as referred to in Article 28 may take the form of advance purchasing agreements of defence products, negotiated and concluded in the name of, or on behalf of, participating countries. Such agreements may include a prepayment mechanism for the production of such products in exchange for the right to the result, which shall not exceed the parts of the contract on non-recurrent costs, including the reservation of manufacturing capacities.

2.

Where the agreements referred to in paragraph 1 of this Article include a prepayment mechanism, the up-front payment to the contractor may be covered by the financial envelope referred to in Article 3(2). Contributions of participating countries as referred to in Article 23 shall be taken into account in equal terms per item ordered by the participating countries.

3.

In cases where the negotiated amounts exceed demand, the Commission, at the request of the participating countries concerned, shall establish a mechanism for reallocation to national stockpiles or for establishing defence industrial readiness pools.

Article 30
Facilitating off-take agreements
1.

The Commission shall set up a system to facilitate the conclusion of off-take agreements related to the industrial ramp-up of the Ukrainian DTIB’s manufacturing capacities, between Member States and Ukraine on the one hand and economic operators of the Ukrainian DTIB on the other, in compliance with the Union’s competition and procurement rules. The Commission shall ensure that access by a non-associated third country other than Ukraine or by another third-country entity to classified or sensitive information relating to the action is prevented and that the employees or other persons involved in the action have national security clearance issued by a Member State, an associated country or Ukraine.

2.

The system referred to in paragraph 1 shall allow interested Member States and Ukraine to make bids for defence products indicating:

(a) the volume and quality;

(b) the intended price or price range;

(c) the intended duration of the off-take agreement.

3.

The system referred to in paragraph 1 of this Article shall allow manufacturers of defence products that comply with criteria equivalent to those laid out in Article 26(1), (3) and (4) to make offers indicating:

(a) the volume and quality of defence products for which they are seeking to conclude off-take agreements;

(b) the intended price or price range at which they are willing to sell;

(c) the estimated delivery lead time of defence products within the framework of the off-take agreement;

(d) the intended duration of the off-take agreement.

4.

Based on the bids and offers received pursuant to paragraphs 2 and 3, the Commission shall put relevant manufacturers of defence products in contact with interested Member States and Ukraine.

5.

Further to the contact referred to in paragraph 4 of this Article, Ukraine and interested Member States may request the Commission to engage in a joint procurement procedure or in a procurement procedure in their name, or on their behalf, pursuant to Article 28.

6.

The financial envelope referred to in Article 3(2) may cover the parts of the contract on non-recurrent costs, including the reservation of manufacturing capacities.

SECTION 4

AWARD CRITERIA AND WORK PROGRAMMES

Article 31
Award criteria
1.

Proposals for actions shall be evaluated in the light of the objectives set for the relevant action, as referred to in Article 22, the expected results of the relevant action, and the quality and efficiency of its implementation.

2.

In addition to the criteria set out in paragraph 1 of this Article, proposals for common procurement actions as referred to in Article 11 may be evaluated based on one or more of the following criteria:

(a) the estimated value of the common procurement;

(b) the action’s contribution to the recovery, reconstruction and modernisation of the Ukrainian DTIB;

(c) the action’s contribution to the acceleration of the procurement of, and the reduction of the production and delivery lead times for, defence products.

3.

In addition to the criteria set out in paragraph 1 of this Article, proposals for industrial reinforcement actions as referred to in Article 12 may be evaluated based on one or more of the following criteria:

(a) the reduction of production lead time and the increase in production capacity in Ukraine;

(b) the contribution to ensuring timely availability and supply of defence products throughout Ukraine;

(c) the contribution to cross-border defence industrial cooperation between Ukraine and the Union.

4.

The work programmes referred to in Article 34 shall lay down further details concerning the application of the award criteria, including any weighting to be applied. The work programmes shall not set individual thresholds.

5.

The evaluation committee may be assisted by independent external experts in accordance with Article 153(3) of the Financial Regulation. The work programmes may specify that those experts are required to hold a valid personal security clearance.

Article 32
Selection and award procedure

Except for actions referred to in Article 11 and Article 13(1), point (g), the Commission shall award the funding under this Chapter by means of implementing acts. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 77(4).

Article 33
Union financial contribution
1.

Where the Union contribution takes the form of grants pursuant to Article 193(3) of the Financial Regulation, the Ukraine Support Instrument may finance up to 100 % of the eligible costs for actions referred to in Article 27(1), points (b) and (c), of this Regulation.

2.

Where the Union grant takes the form of financing not linked to costs, the level of the Union contribution to each action may be based on factors such as:

(a) the degree of complexity of the common procurement, for which a proportion of the estimated value of the action and the experience gained in similar actions may serve as an initial proxy;

(b) the contribution of the action to improving interoperability outcomes;

(c) the characteristics of the action which are likely to give rise to greater long-term investment signals to industry;

(d) the contribution of the action to the ramp-up of necessary manufacturing capacities in Ukraine;

(e) the degree of complexity for Ukraine to progress with the process towards accession to the Union, including structural reforms and measures to promote convergence with Union rules, standards, policies and practices;

(f) the degree of complexity for Ukraine to adapt its defence procurement processes and the environment of the Ukrainian defence industry, including to meet NATO standards and other relevant standards;

(g) the hardship and risks associated with Russia’s war of aggression against Ukraine, taking into account the need to rebuild and modernise infrastructure damaged by that war in a resilient way and the need to avoid, prevent, reduce and, if possible, offset such damages.

3.

Actions referred to in Article 27(1), point (a), of this Regulation shall be funded by way of grants in the form of financing not linked to costs, pursuant to Article 183(3) of the Financial Regulation.

4.

For actions referred to in Article 27(1), point (a), the support from the Ukraine Support Instrument shall not exceed 25 % of the estimated value of the common procurement contract concerned.

5.

The work programmes referred to in Article 34 shall lay down further details.

Article 34
Work programmes
1.

The Ukraine Support Instrument shall be implemented by work programmes as referred to in Article 110 of the Financial Regulation. Work programmes may be multiannual, when appropriate. Work programmes shall set out the actions and associated budget required to meet the objectives of the Ukraine Support Instrument.

2.

The Commission shall adopt work programmes by means of implementing acts. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 77(4).

3.

The work programmes shall include in particular:

(a) the overall amount of the Union contribution to each type of action referred to in Article 27(1) and a detailed description of each type of action;

(b) with respect to actions referred to in Article 27(1), points (a) and (b), the minimum financial size of the actions;

(c) with respect to actions referred to in Article 27(1), point (b), the maximum number of legal entities forming part of the consortium, which shall not exceed 15 legal entities;

(d) the procedure for the evaluation and selection of proposals, including, where relevant, a description of the milestones, designed in such a way as to mark substantial progress in the implementation of actions, the results to be achieved and the associated amounts to be disbursed, as well as the arrangements for the verification of the milestones, the fulfilment of conditions and the achievement of results;

(e) the overall amount of the Union contribution to joint procurement with the support of the Commission as referred to in Article 28(1), Article 29 and Article 30; and

(f) the methods for determining and, where applicable, adjusting the funding.

4.

When adopting work programmes, the Commission shall take into account the need for coherence with other relevant Union programmes and instruments.

CHAPTER IV

EUROPEAN DEFENCE PROJECTS OF COMMON INTEREST

Article 35
European Defence Projects of Common Interest
1.

European Defence Projects of Common Interest (EDPCIs) shall consist of collaborative industrial projects aimed at reinforcing the competitiveness of the EDTIB throughout the Union while contributing to the development of Member States’ military capabilities critical for the security and defence interests of the Union, and including those capabilities securing access to all operational domains, namely land, maritime, air, space and cyber.

2.

EDPCIs shall meet all the following criteria:

(b) they contribute to the development of Member States’ military capabilities critical for the security and defence interests of the Union and are consistent with the objectives of the Strategic Compass for Security and Defence, with the defence capability priorities commonly agreed by Member States within the framework of the CFSP, in particular in the context of the CDP, and with the collaborative opportunities identified in the context of CARD;

(c) they take into account Member States’ cooperation in the framework of PESCO and EDA initiatives and projects;

(d) they take into account the relevant activities carried out by NATO, such as the NATO Defence Planning Process, where such activities serve the security and defence interests of the Union;

(e) they involve at least four Member States, and all Member States and associated countries, as well as Ukraine, are given a genuine opportunity to participate in the EDPCI;

(f) their benefits extend to a wider part of the Union;

(g) they are particularly significant in size or scope or aim to mitigate a considerable level of technological or financial risk, or both;

(h) their potential overall benefits outweigh their costs, including in the longer term.

3.

The Council, acting upon a proposal from the Commission, may adopt implementing acts identifying EDPCIs.

4.

Member States shall coordinate to prepare project proposals for possible EDPCIs in an inclusive way, with the support of the EDA where necessary.

5.

Before proposing the implementing acts as referred to in paragraph 3, the Commission shall verify the compliance of the project proposals referred to in paragraph 4 with all the criteria listed in paragraph 2 and:

(a) consult Member States in an inclusive manner and take into account their views and project proposals for possible EDPCIs;

(b) invite the High Representative of the Union for Foreign Affairs and Security Policy (the ‘High Representative’) and the EDA to provide their expertise with a view to ensuring consistency with the priorities and objectives referred to in paragraph 2, points (b), (c) and (d), in particular the defence capability priorities commonly agreed by Member States within the framework of CFSP, in particular as jointly expressed in the context of the CDP, to complement the information provided by Member States regarding project proposals; and

(c) verify that all Member States and associated countries, and, where relevant, Ukraine, were informed of the emergence of a project and were given the opportunity to participate.

6.

In the implementing acts referred to in paragraph 3, the Council shall:

(a) set out the objectives and characteristics of the EDPCI in relation to the criteria set out in paragraph 2;

(b) establish the list of countries participating in the EDPCI at the date of the adoption of the implementing act; and

(c) estimate the overall financial size of the EDPCI.

7.

The Council shall adopt the implementing acts referred to in paragraph 3 acting by qualified majority. The Council may amend the project proposals referred to in paragraph 4 acting by qualified majority.

8.

The deployment of an EDPCI which is eligible for Union funding as referred to in Article 10(1), point (d), shall consist only of one or more activities related to:

(a) the common procurement of defence products;

(b) accelerating the adjustment to structural changes of the production capacity of defence products, as well as related supporting activities;

(c) the industrial development of new defence products or the upgrading of existing ones;

(d) the development and procurement of necessary infrastructure.

9.

The participating Member States shall ensure that criteria equivalent to those set out in Article 9 are applied in the contracts relating to the EDPCI activities supported by Union funding. For the common procurement of defence products supported by Union funding under EDPCIs, Article 11(6) shall also apply.

10.

Member States participating in an EDPCI shall ensure that the EDPCI activities, including those not supported by Union funding, comply with the objectives set out in Article 4 and in paragraph 1 of this Article and do not affect compliance of the EDPCI with the criteria set out in paragraph 2 of this Article.

11.

An EDPCI may address the development of dual-use capabilities for the Union.

12.

An EDPCI, as well as its specific activities, may be established in the framework of a SEAP.

13.

Only Member States and associated countries, as well as SEAPs consisting of Member States or of Member States and associated countries, shall be eligible for funding under EDPCI activities.

14.

The Commission shall be able, where relevant, to participate in the project. Participating Member States may decide to involve the High Representative and the EDA as observers to an EDPCI.

15.

Member States may, without prejudice to Articles 107 and 108 TFEU, apply support schemes and provide for administrative support to EDPCIs.

16.

The planning, construction and operation of production facilities related to an EDPCI may be considered an imperative reason of overriding public interest within the meaning of Article 6(4) and Article 16(1), point (c), of Council Directive 92/43/EEC (40) and Article 4(7) of Directive 2000/60/EC of the European Parliament and of the Council (41), in the interests of defence within the meaning of Article 2(3) of Regulation (EC) No 1907/2006 of the European Parliament and of the Council (42) and in the interests of public health and safety within the meaning of Article 9(1), point (a), of Directive 2009/147/EC of the European Parliament and of the Council (43), provided that the other conditions set out in those provisions are fulfilled.

17.

Member States participating in an EDPCI shall submit to the Commission, on an annual basis, a joint report on the implementation of the EDPCI activities, including on compliance with the requirements set out in paragraph 10 of this Article.

18.

Upon a proposal from the Commission, the Council, acting by qualified majority, may amend the implementing acts adopted pursuant to paragraph 3, including by removing a project as an EDPCI or by reflecting changes to the elements set out in paragraph 6.

19.

All Member States and associated countries, and Ukraine, shall have the opportunity to join an EDPCI after its establishment, subject to the approval of all Member States participating in the EDPCI.

CHAPTER V

EUROPEAN MILITARY SALES MECHANISM

Article 36
European Military Sales Mechanism
1.

To strengthen the competitiveness of the EDTIB as well as, where relevant, of the Ukrainian DTIB, in particular by increasing the ability of the EDTIB to ensure the availability of defence products in time and in volume, a European Military Sales Mechanism is hereby established.

2.

The European Military Sales Mechanism shall consist of the following:

(a) establishing a European Military Sales Catalogue;

(b) the possibility of establishing, managing and maintaining defence industrial readiness pools; and

(c) measures contributing to the facilitation of procedures for the common procurement of defence products.

Article 37
European Military Sales Catalogue
1.

The Commission, having consulted the EDA, shall establish and keep up-to-date a single, centralised catalogue of defence products developed by the EDTIB and the Ukrainian DTIB (the ‘catalogue’). The Commission shall consult the EDA and take into account its views in drawing up the technical specifications for the catalogue and, where appropriate, procure the corporate IT platform required to establish it. Member States, Ukraine and economic operators shall be invited to populate the catalogue on a voluntary basis.

2.

The defence products present in the catalogue shall be manufactured by economic operators respecting the eligibility criteria set out in Article 9(1), (3) and (4) or Article 26(1), (3) and (4). In addition, the catalogue shall indicate whether the economic operator has the ability to decide, without restrictions imposed by non-associated third countries or by non-associated third-country entities, on the definition, adaptation and evolution of the design of the defence product, including the legal authority to substitute or remove components that are subject to restrictions imposed by non-associated third countries or by non-associated third-country entities. The support received under the Programme, the Ukraine Support Instrument or Regulation (EU) 2018/1092 of the European Parliament and of the Council (44), Regulation (EU) 2021/697 of the European Parliament and of the Council (45) or Regulation (EU) 2023/1525 or (EU) 2023/2418 may also be indicated in the catalogue.

Article 38
Defence industrial readiness pools
1.

A consortium of Member States, associated countries or Ukraine or a SEAP may establish, manage and maintain defence industrial readiness pools, and may, for that purpose, invite the EDA to provide its expertise.

For the purposes of the first subparagraph, a consortium of Member States, associated countries or Ukraine shall consist of at least three of those countries, of which at least two shall be Member States.

2.

Member States that establish a defence industrial readiness pool shall ensure that the establishment, management and maintenance of that pool comply with the objectives set out in Article 36(1), as well as with the objectives set out in Article 4 and, where relevant, Article 22.

3.

Member States, associated countries, Ukraine and SEAPs that establish a defence industrial readiness pool shall grant all Member States, associated countries and Ukraine an immediate and preferential purchase, use or lease option for defence products that are part of that defence industrial readiness pool.

4.

Where a defence industrial readiness pool is established in the context of a SEAP, the Programme or the Ukraine Support Instrument may financially support the following:

(a) the common procurement of additional quantities of defence products through common procurement actions carried out by the SEAP in accordance with Article 11;

(b) the establishment and the functioning of the SEAP for the purpose of managing and maintaining a defence industrial readiness pool in accordance with Article 13(1), point (g).

5.

For the purpose of Member States or, where applicable, associated countries buying from the defence industrial readiness pool established, managed and maintained by a SEAP, the procurement shall be considered as a contract awarded by a government to another government as referred to in Article 13, point (f), of Directive 2009/81/EC.

Article 39
Facilitation of procedures for the common procurement of defence products

Where Member States enter into an agreement to commonly procure defence products, they may apply the rules and procedures provided for in Article 11(9) and (10), Article 52 and Article 53, subject to the conditions set out therein.

CHAPTER VI

STRUCTURE FOR EUROPEAN ARMAMENT PROGRAMME

Article 40
Specific objective and activities of a Structure for European Armament Programme
1.

A Structure for European Armament Programme (SEAP) shall foster the competitiveness of the EDTIB and, where relevant, of the Ukrainian DTIB. That shall be achieved by aggregating the demand for, and ensuring the timely availability and supply of, defence products throughout their life cycle, as well as by stimulating cross-border industrial cooperation.

2.

To reach the objective referred to in paragraph 1, the principal tasks of a SEAP shall be at least one of the following:

(a) the common development of defence products and technologies, including defence research and development, testing and certification; industrial capacity-building, including through industrialisation and commercialisation; and support to non-recurrent investments related to initial production or in-service support, in particular where the defence products are being or have been developed in the framework of actions funded by the Union under the corresponding Union programme;

(b) the common procurement of defence products and technologies, including for the purpose of establishing, managing or maintaining defence industrial readiness pools;

(c) the common life cycle management of defence products, including the procurement of spare parts, logistic or maintenance services and, where appropriate, the establishment of public-private partnerships to ensure efficiency and high availability of defence products; or

(d) the dynamic availability management of additional quantities, ensuring an immediate and preferential purchase, use or lease option for Member States, associated countries or Ukraine in the context of defence industrial readiness pools.

3.

A SEAP may entrust, by way of a delegation agreement, one or more of the eligible entities referred to in Article 11(2) with carrying out one or more of the tasks referred to in paragraph 2 of this Article. The SEAP shall be responsible for ensuring that its obligations under Union law, and in particular under this Regulation, are met.

Article 41
Requirements relating to the establishment of a SEAP
1.

With a view to strengthening the competitiveness of the EDTIB or the Ukrainian DTIB, a SEAP shall meet all of the following requirements:

(a) support cooperation until the end of the life cycle of a defence product or until the winding-up of the SEAP;

(b) support the common development, procurement or in-service support of defence products, consistent with the defence capability priorities commonly agreed by Member States within the framework of the CFSP, in particular in the context of the CDP;

(c) take into account the relevant activities carried out by NATO, such as the NATO Defence Planning Process, where such activities serve the security and defence interests of the Union; and

(d) have at least three members, of which at least two are Member States.

2.

A SEAP shall use standardised procedures for initiating and managing cooperative armament programmes. The Commission, taking into account the views expressed by Member States, may establish guidance or templates for those procedures, including guidelines on project management, procurement, financial management and reporting.

Article 42
Applications for the establishment of a SEAP
1.

Applications for the establishment of a SEAP shall be submitted to the Commission. The application shall contain the following:

(a) a request to the Commission to establish the SEAP;

(b) the proposed statutes of the SEAP referred to in Article 45, signed and adopted in due form by all the members of the proposed SEAP;

(c) an outline description of the defence products to be developed, procured or managed by the SEAP, addressing in particular the requirements set out in Article 41(1), points (a) and (b);

(d) a declaration by the Member State on the territory of which the SEAP is foreseen to have its statutory seat, recognising the SEAP as an international body within the meaning of Article 143(1), point (g), and Article 151(1), point (b), of Directive 2006/112/EC and as an international organisation within the meaning of Article 11(1) of Directive (EU) 2020/262, as of its establishment;

(e) where an associated country or Ukraine is to be a member of the SEAP, a declaration of the recognition of the most extensive legal capacity of the SEAP in accordance with Article 44(2).

For the purposes of point (d) of the first subparagraph of this paragraph, the limits and conditions of the exemptions provided for in Article 143(1), point (g), and Article 151(1), point (b), of Directive 2006/112/EC and in Article 11(2) of Directive (EU) 2020/262 shall be laid down in an agreement between the members of the SEAP.

2.

The Commission shall, without undue delay after receipt of the complete application as referred to in paragraph 1, assess that application in accordance with the requirements laid down in this Regulation and may, for that purpose, invite the EDA to provide its expertise. The result of that assessment shall be communicated to the applicants who shall, if necessary, be invited to complete or amend the application.

3.

The Commission, by means of an implementing act taking into account the results of the assessment referred to in paragraph 2, shall:

(a) establish the SEAP after it has concluded that the requirements laid down in this Regulation are met; or

(b) reject the application if it concludes that the requirements laid down in this Regulation are not met, including in the absence of the declaration referred to in paragraph 1, point (d), after providing an opportunity to the applicants to complete or amend the application.

4.

The decision on the application shall be notified to the applicants. In the case of a rejection, the decision shall be explained in clear and precise terms to the applicants.

5.

The implementing act establishing the SEAP referred to in paragraph 3, point (a), of this Article shall be adopted in accordance with the examination procedure referred to in Article 77(4) and shall be published in the Official Journal of the European Union.

Article 43
Status and seat of a SEAP
1.

A SEAP shall have legal personality as from the date on which the implementing act establishing it takes effect.

2.

A SEAP shall have in each Member State the most extensive legal capacity accorded to legal entities under the law of that Member State, in particular the capacity to acquire, own and dispose of movable property, immovable property and intellectual property, conclude contracts and be a party to legal proceedings. All Member State national funding agencies shall consider a SEAP an eligible recipient of national financial contributions.

3.

A SEAP shall have a statutory seat, which shall be located on the territory of a Member State.

Article 44
Requirements for membership of a SEAP
1.

The following countries may be members of a SEAP:

(a) Member States;

(b) associated countries;

(c) Ukraine.

2.

Associated countries or Ukraine may be members of a SEAP subject to their recognition, for the benefit of the SEAP, of the most extensive legal capacity accorded to legal entities under the law of that country, including for the purposes of concluding contracts and being a party to legal proceedings.

3.

Member States, associated countries or Ukraine may join as members of a SEAP at any time after that SEAP’s establishment, on fair and reasonable terms specified in the statutes referred to in Article 45, or as observers without voting rights on conditions specified in those statutes.

4.

A SEAP may also cooperate with a non-associated third country other than Ukraine or another third-country entity, including by using the assets, infrastructure, facilities and resources of such legal entities, provided that such cooperation does not contravene the security and defence interests of the Union and its Member States, including the respect of the principle of good neighbourly relations.

Article 45
Statutes of a SEAP
1.

The statutes of a SEAP shall contain at least the following:

(a) a list of members of the SEAP, observers and, where applicable, legal entities representing members, and the conditions of, and the procedure for changes in, membership and representation in compliance with Article 44;

(b) the specific objectives, tasks and activities of the SEAP, in compliance with Articles 40 and 41, including an outline description of the defence products to be developed, procured or managed by the SEAP;

(c) a list of the defence products which are to be owned by the SEAP, if any, and which are eligible for an exemption from VAT or excise duties;

(d) the statutory seat of the SEAP in compliance with Article 43(3);

(e) the identification of the national law of the Member State that determines the competent jurisdiction for the resolution of disputes among SEAP members in relation to the SEAP, between SEAP members and the SEAP, and between a SEAP and third parties, in compliance with Article 49(2);

(f) the name of the SEAP;

(g) the duration and the procedure for the winding-up of the SEAP in compliance with Article 50;

(h) a description of the main criteria that the SEAP is to apply when procuring defence products to ensure compliance with the objective set out in Article 40(1);

(i) the liability regime, including the possibility to issue securities, if so decided, in compliance with Article 48;

(j) the rights and obligations of the members of the SEAP, including the obligation to make contributions to a balanced budget and voting rights;

(k) the governing bodies of the SEAP, their roles and responsibilities and the manner in which they are constituted, and the decision-making process within the SEAP, including the applicable voting rules, in particular on the amendment of the statutes in compliance with Article 46;

(l) the identification of the working language or languages of the SEAP;

(m) references to the rules implementing the statutes of the SEAP;

(n) rules on the protection of classified information;

(o) the identification of the Union and national rules applicable to the handling of the defence products to be developed, procured or managed by the SEAP, and the administrative capacities foreseen to ensure compliance with those rules.

For the purposes of point (k) of the first subparagraph of this paragraph, the voting rules applicable to amendments relating to the approach to the export of defence products, if included in the statutes, and to the financial liability regime shall comply with paragraph 4 of this Article and Article 48(5) respectively.

2.

Where the members of a SEAP decide to establish a defence industrial readiness pool, the statutes shall include the rules governing the management of that defence industrial readiness pool.

3.

The statutes, signed and adopted unanimously by all the members of a SEAP in accordance with Article 42(1), point (b), may contain an approach to the export of defence products.

4.

Any change to the approach to the export of defence products referred to in paragraph 3 shall be decided unanimously by the members of a SEAP.

Article 46
Amendment of the statutes of a SEAP
1.

Any amendment of the statutes of a SEAP concerning the matters referred to in Article 45(1), points (a) to (k), shall be adopted in accordance with the voting rules specified in the statutes in compliance with Article 45(1), point (k), and be submitted to the Commission by the SEAP for approval.

2.

Any amendment of the statutes concerning the matters referred to in Article 45(3) shall be adopted in accordance with the voting rules specified in the statutes in compliance with Article 45(1), point (k), and be notified to the Commission by the SEAP within 10 days of the date of its adoption.

3.

Any amendment of the statutes other than that referred to in paragraphs 1 and 2 of this Article shall be adopted in accordance with the voting rules specified in the statutes in compliance with Article 45(1), point (k), and shall be submitted to the Commission by the SEAP within 10 days of the date of its adoption.

4.

The Commission may raise an objection to an amendment of the statutes as referred to in paragraph 3 within 30 days of the date of its submission, giving reasons why the amendment does not meet the requirements of this Regulation.

5.

An amendment of the statutes as referred to in paragraph 3 shall not take effect before the period for raising an objection referred to in paragraph 4 has expired or been waived by the Commission or before an objection raised has been withdrawn.

6.

An application for the amendment of the statutes as referred to in paragraphs 1, 2 and 3 shall contain the following:

(a) the text of the amendment proposed or, where applicable, the text of the amendment as adopted; and

(b) the amended consolidated version of the statutes.

Article 47
Specific conditions on procurement
1.

In accordance with Article 40(3), a SEAP may entrust an eligible entity referred to in Article 11(2) with carrying out procurement actions. Such an entity shall act in the name of, or on behalf of, that SEAP.

2.

For the purposes of procurement of defence products, SEAPs shall be considered as international organisations within the meaning of Article 12, point (c), of Directive 2009/81/EC. SEAPs shall define their own procurement rules in compliance with the principles governing public procurement, in particular those of non-discrimination, equal treatment, proportionality and transparency.

3.

When procuring defence products, a SEAP shall apply to its procurement procedures and contracts criteria ensuring that its procurement policy complies with the objectives referred to in Article 40(1). A SEAP shall actively seek to include multiple legal entities from various Member States in the supply chains of defence products.

4.

Where a delegation agreement as referred to in Article 40(3) is concluded, the parties to that agreement may decide that the procurement rules of the entity carrying out the procurement apply, provided that those rules comply with the principles referred to in paragraph 2 of this Article, in particular those of non-discrimination, equal treatment, proportionality and transparency.

5.

Where Member States or, where applicable, associated countries purchase defence products from a SEAP, including from a defence industrial readiness pool, that procurement shall be considered as a contract awarded by a government to another government as referred to in Article 13, point (f), of Directive 2009/81/EC.

Article 48
Liability and insurance
1.

A SEAP shall be liable for its debts.

2.

The financial liability of the members of a SEAP for the debts of the SEAP shall be limited to their respective contributions to the SEAP. The members may specify in the statutes of a SEAP that they will assume a fixed liability above their respective contributions or will assume unlimited liability.

3.

If the financial liability of its members is limited, the SEAP shall take appropriate insurance to cover the risks specific to the establishment and management of the capability of the SEAP.

4.

If decided unanimously by its members, a SEAP may issue securities in accordance with the law of the Member State on the territory of which it has its statutory seat. The SEAP shall be liable for such securities.

5.

Any change to the liability regime or any measure affecting the financial liability of the members of a SEAP shall be decided unanimously by those members.

6.

The Union shall not be liable for any debt of a SEAP.

Article 49
Applicable law and jurisdiction
1.

The establishment and internal functioning of a SEAP shall be governed:

(a) by Union law, in particular this Regulation and the implementing act referred to in Article 42(3), point (a);

(b) by its statutes and their implementing rules;

(c) by the law of the Member State on the territory of which the SEAP has its statutory seat in relation to matters not, or only partly, regulated by the acts referred to in points (a) and (b).

2.

Without prejudice to cases in which the Court of Justice of the European Union has jurisdiction under the Treaties, the national law of the Member State on the territory of which the SEAP has its statutory seat shall determine the competent jurisdiction for the resolution of disputes among SEAP members in relation to the SEAP, between SEAP members and the SEAP, and between a SEAP and third parties.

3.

Delegation agreements as referred to in Article 40(3) shall determine which Member State jurisdiction is competent for the resolution of disputes related to the delegation agreement concerned. Delegation agreements may also provide for amicable dispute settlement mechanisms. This shall be without prejudice to cases in which the Court of Justice of the European Union has jurisdiction under the Treaties.

Article 50
Winding up and insolvency
1.

The statutes of a SEAP shall determine the procedure to be applied in the event of winding-up of the SEAP following a decision of the assembly of its members or, in the event that the Commission repeals the implementing act establishing the SEAP, as referred to in Article 51(7). Winding-up may include the transfer of activities and of the ownership of defence products to another legal entity.

2.

Without undue delay after the adoption of a decision by the assembly of its members to wind up the SEAP, and in any event within 10 days of such adoption, the SEAP shall notify the Commission thereof and designate a representative for the winding-up. The Commission shall publish an appropriate notice of the decision to wind up in the Official Journal of the European Union.

3.

The winding-up procedure shall not be closed before the completion of the transfer of ownership of defence products owned by the SEAP.

4.

Without undue delay after the closure of the winding-up procedure, and in any event within 10 days of such closure, the SEAP representative shall notify the Commission thereof. The Commission shall publish an appropriate notice of the closure in the Official Journal of the European Union. The SEAP shall cease to exist on the date of publication of that notice.

5.

In the event that the SEAP is unable to pay its debts, it shall immediately notify the Commission thereof. The Commission shall publish an appropriate notice in the Official Journal of the European Union.

Article 51
Reporting and control
1.

A SEAP shall produce an annual activity report, containing a technical description and a financial report of its activities referred to in Article 40. It shall be transmitted to the Commission within six months of the end of the financial year. The Commission shall distribute the report to all Member States.

2.

The Commission shall provide the European Parliament and the Council with an aggregated annual report on the activities of all active SEAPs.

3.

The Commission may provide recommendations to a SEAP regarding the matters covered in the annual activity report referred to in paragraph 1.

4.

A SEAP and the Member States concerned shall inform the Commission of any circumstances which threaten to seriously jeopardise the achievement of the task of the SEAP or to hinder the SEAP from fulfilling the requirements laid down in this Regulation.

5.

Where the Commission obtains indications that a SEAP is acting in serious breach of this Regulation, the implementing act establishing it, its statutes or other applicable law, it shall request explanations from the SEAP or its members.

6.

Where the Commission concludes, after having given the SEAP or its members at least two months to provide their observations, that the SEAP is acting in serious breach of this Regulation, the implementing act establishing it, its statutes or other applicable law, it may propose remedial action to the SEAP and its members.

7.

Where no remedial action as referred to in paragraph 6 of this Article is taken, the Commission may repeal the implementing act establishing the SEAP. The repealing act shall be published in the Official Journal of the European Union. The publication of the repealing act shall trigger the winding-up of the SEAP as referred to in Article 50.

CHAPTER VII

SECURITY OF SUPPLY

SECTION 1

COOPERATIVE DEFENCE PROCUREMENT

Article 52
Modification of framework agreements in the context of a crisis under Directive 2009/81/EC
1.

Where at least two Member States enter into an agreement to commonly procure defence products for themselves or for Ukraine and where justified by an urgency resulting from a crisis as defined in Article 1(10) of Directive 2009/81/EC, the rules provided for in paragraphs 2 to 6 of this Article may be applied to framework agreements that do not include rules governing the possibility to substantially amend the agreement. When applying the rules in paragraphs 2 and 3 of this Article, the contracting authority that concluded the framework agreement shall obtain the agreement of the undertaking with which it concluded the framework agreement.

2.

A contracting authority of a Member State may modify an existing framework agreement for defence products, where that framework agreement was concluded with an undertaking complying with criteria equivalent to those laid down in Article 9(1), (3) and (4) of this Regulation, in order to add new contracting authorities as party to that framework agreement so that its provisions apply to contracting authorities which were not originally party to the framework agreement. Article 29(2), first subparagraph, of Directive 2009/81/EC shall not apply to the contracting authorities not originally party to the framework agreement.

3.

By way of derogation from Article 29(2), third subparagraph, of Directive 2009/81/EC, when awarding contracts based on a framework agreement with an estimated value above the threshold set out in Article 8 of that Directive, a contracting authority of a Member State may make substantial amendments to the quantities laid down in that framework agreement of up to 100 % of the value of the framework agreement, where that framework agreement was concluded with an undertaking complying with criteria equivalent to those laid down in Article 9(1), (3) and (4) of this Regulation and in so far as the modification is strictly necessary for the application of paragraph 2 of this Article.

4.

For the purpose of the calculation of the value mentioned in paragraph 3 where the contract includes an indexation clause, the updated value shall be the reference point.

5.

In the cases referred to in paragraphs 2 and 3, the principle of equal rights and obligations shall apply to the relationships between the contracting authorities which are party to the framework agreement, in particular regarding the cost of additional quantities procured.

6.

A contracting authority which has modified a framework agreement in the cases referred to in paragraph 2 or 3 of this Article shall publish a notice to that effect in the Official Journal of the European Union. Such a notice shall be published in accordance with Article 32 of Directive 2009/81/EC.

Article 53
Cases justifying use of the negotiated procedure without publication of a contract notice in the context of a defence cooperation initiative

A contracting authority of a Member State, where it establishes a new or joins an existing genuine defence cooperation initiative established by an international agreement or arrangement between Member States and, where relevant, one or more associated countries or Ukraine, with the aim of the convergence of military capabilities, may award a contract to, or conclude a framework agreement on a defence product with, an undertaking, in accordance with Article 28(1), point (e), of Directive 2009/81/EC, provided that all of the following conditions are met:

(a) the undertaking concerned complies with criteria equivalent to those laid down in Article 9(1), (3) and (4);

(b) the defence cooperation initiative referred to in the introductory sentence of this Article was initiated prior to the commencement of the procurement procedure by the contracting authority of the Member State concerned;

(c) one of the other Member States participating in the defence cooperation initiative referred to in the introductory sentence of this Article has already awarded a contract to, or concluded a framework agreement on a defence product with, that undertaking;

(d) the defence product to be procured is identical to the one referred to in point (c) of this Article or is subject to minor modifications only;

(e) the award of the contract or the conclusion of the framework agreement is necessary for the implementation of the defence cooperation initiative referred to in point (b) of this Article.

SECTION 2

PREPAREDNESS

Article 54
Acceleration of the permit-granting process for the timely availability and supply of crisis-relevant products
1.

Member States shall ensure that administrative applications related to the planning, construction and operation of production facilities, transfer of inputs within the Union and qualification and certification of end products are processed in an efficient and timely manner. To that end, all national authorities concerned shall ensure that the most rapid treatment legally possible is given to such applications.

2.

Member States shall ensure that, in the planning and permit-granting process, the construction and operation of plants and installations for the production of crisis-relevant products are given priority when balancing legal interests in the individual case concerned.

Article 55
Facilitation of the cross-certification process
1.

Member States shall adopt a list of national certification authorities for defence purposes and notify it to the Commission, which shall make it available to Member States.

2.

The Commission, taking into account the views of the EDA, shall draw up and keep updated, by means of implementing acts, an official list of national certification authorities for defence purposes as identified by Member States. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 77(4).

3.

A certification authority of one Member State may request from the certification authority of another Member State information about the scope of the certification of a certain defence product.

4.

The national certification authorities referred to in paragraph 1 shall cooperate with each other in the performance of their tasks under this Regulation and shall give the authorities of other Member States all necessary support to that end. The Commission, inviting, where relevant, the EDA to provide its expertise, shall support such cooperation in order to facilitate an efficient and effective movement of defence products in the internal market.

Article 56
Mapping of defence supply chains
1.

The mapping of the Union’s defence supply chains shall aim to analyse the strengths and weaknesses of such supply chains, with an emphasis on bottlenecks. It shall inform, where relevant, the development of the work programmes of the Programme and of the Ukraine Support Instrument as referred to in Articles 21 and 34.

2.

The mapping of the Union’s defence supply chains shall consist of the following activities, to be performed on a regular basis:

(a) identification of the relevant manufacturing capacities and supply chains of defence products pursuant to paragraph 5;

(b) identification of crisis-relevant products and their related manufacturing capacities, pursuant to paragraph 9;

(c) aggregation, cross-check and assessment of data gathered pursuant to paragraphs 6, 7 and 8;

(d) identification of early-warning indicators, pursuant to paragraph 11; and

(e) identification of the main suppliers of crisis-relevant products and their production capacities, pursuant to paragraphs 12 and 13.

3.

The Commission, in cooperation with the Defence Security of Supply Board (the ‘Board’), shall carry out the activities referred to in paragraph 2, points (b), (c) and (d). The Member States shall carry out the activities referred to in paragraph 2, points (a) and (e). Each Member State may request the Commission to carry out, on its behalf, the activities referred to in paragraph 2, points (a) and (e).

4.

The Commission shall, after consulting the Board, develop a framework and methodology for identifying crisis-relevant products, with an emphasis on existing bottlenecks, as well as their related manufacturing capacities in the Union, and for the mapping of supply chains of those products. That methodology shall build upon any frameworks or methodologies that exist within Member States. For that purpose, the Board may issue recommendations on the type of information appropriate for the mapping of supply chains of crisis-relevant products, on the technical specifications and formats for communicating that information and on the periodicity of such communication.

5.

On the basis of the framework and methodology developed pursuant to paragraph 4, Member States shall identify on their territory the relevant manufacturing capacities and supply chains of defence products and shall provide the outcome of that identification to the Commission.

6.

The Commission shall aggregate the data provided by Member States pursuant to paragraph 5 and perform a cross-check, with a view to identifying a list of crisis-relevant products and their related manufacturing capacities and to assessing the strengths and weaknesses of the Union’s supply chains of such products.

7.

To complement the data provided by Member States, the Commission shall use publicly and commercially available data and relevant non-confidential information from economic operators, as well as the results of similar analyses performed, including in the context of Union law on raw materials, semiconductors and renewable energy, the results of the relevant activities of the EDA, the results of the stress tests conducted pursuant to Article 58 and the results of the evaluation carried out pursuant to Article 85(2).

8.

Where the data referred to in paragraphs 6 and 7 are not sufficient for the performance of its tasks pursuant to paragraph 6, the Commission may request the relevant actors involved in the supply chains concerned and based in the Union to provide, on a voluntary basis, information to the Member State on the territory of which the production site of the addressed economic operator is located. The Commission’s request shall explicitly indicate that the economic operator is free to refuse such a request. The request for information shall include the contact information of the national competent authorities of the Member State on the territory of which the production site of the addressed economic operator is located to which the reply is to be sent. Where the economic operator decides to provide the requested information to the Member State concerned, the Member State concerned shall make that information available to the Commission.

9.

The Commission, by means of an implementing act, shall draw up and regularly update the list of crisis-relevant products. That implementing act shall be adopted in accordance with the examination procedure referred to in Article 77(4).

10.

The Commission shall inform the Board of the aggregate results of the mapping on an annual basis or at the request of one of the members of the Board as referred to in Article 76(5). Those results shall constitute classified information.

11.

The Commission shall, on the basis of the outcome of the activities carried out pursuant to paragraphs 4, 6 and 7 and after consulting the Board, develop a list of early-warning indicators aimed at identifying factors that could disrupt, compromise or negatively affect the supply of crisis-relevant products. The Commission, after consulting the Board, shall review the list of early-warning indicators on a regular basis, and at least every two years.

12.

Member States shall, in cooperation with the Commission and the EDA, where relevant, identify the main suppliers of crisis-relevant products established on their territory, without unnecessary delay, after the adoption of the implementing act referred to in paragraph 9 of this Article. Each Member State shall notify the main suppliers of crisis-relevant products established on its territory that they have been identified pursuant to this paragraph and inform them about the obligation to report on disruptions in the supply of crisis-relevant products as set out in Article 57(1), point (c). That notification shall also include the relevant contact information of the national competent authorities to which that report is to be sent.

13.

The identification of main suppliers as referred to in paragraph 12 may take into account the following elements:

(a) the market share of the supplier in the market for that crisis-relevant product;

(b) the importance of the supplier in maintaining a sufficient level of supply of a crisis-relevant product in the Union, taking into account the availability in the Union of alternative means for the provision of that product; or

(c) the impact that a disruption of supply of the crisis-relevant product provided by the supplier could have on the functioning of the internal market.

14.

Without prejudice to paragraph 10 of this Article, any information obtained pursuant to this Article shall be treated in compliance with the confidentiality obligations set out in Article 80.

15.

This Article is without prejudice to the right of each Member State to protect the essential interests of its security in accordance with Article 346(1), point (a), TFEU.

Article 57
Monitoring
1.

Member States and the Commission, in cooperation with the Board, shall carry out regular monitoring of the Union’s manufacturing capacities necessary for the supply of crisis-relevant products, identified in accordance with Article 56(9), with a view to identifying possible risks to the supply of those products. In carrying out that monitoring:

(a) the Commission, in cooperation with the Board, shall monitor early-warning indicators identified pursuant to Article 56(11), including by aggregating any input received from Member States on the basis of information collected at national level;

(b) Member States shall monitor, in light of the early-warning indicators, the ability of the main suppliers of crisis-relevant products referred to in Article 56(12) to carry out their activities and report to the Board on any events that could have negative and lasting consequences on the timely availability and supply of those products;

(c) where main suppliers of crisis-relevant products detect disruptions of supply which could significantly affect their activities related to the production of those products, they shall report on such disruptions to the Member State on the territory of which they are established, and the Member State concerned shall communicate that information to the Commission without undue delay;

(d) the Commission, after consulting the Board, shall identify best practices for preventive risk mitigation and increased transparency of the Union’s manufacturing capacities necessary for the supply of crisis-relevant products.

The Commission, after consulting the Board, shall establish the frequency of the monitoring referred to in the first subparagraph.

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