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)

The Commission and the Member States shall pay particular attention to SMEs in order to minimise the administrative burden resulting from the monitoring referred to in paragraph 1 and may, where necessary, provide dedicated assistance.

The Commission may invite, after consulting the Board, the main suppliers of crisis-relevant products referred to in Article 56(12), Member States, national defence industry associations and other relevant stakeholders to provide information, on a voluntary basis, for the purpose of carrying out monitoring activities in accordance with paragraph 1, first subparagraph, point (a), of this Article.

For the purposes of paragraph 1, first subparagraph, point (b), of this Article, Member States may request information, on a voluntary basis, from the main suppliers of crisis-relevant products referred to in Article 56(12) where necessary and proportionate.

For the purposes of paragraph 3, competent authorities of Member States shall establish and maintain a list of contacts of the main suppliers of crisis-relevant products which are established on their territory. That list shall be transmitted to the Commission. Within the Board, the Commission shall provide for a standardised format for that list of contacts.

Without prejudice to the protection of commercially confidential information, Member States shall provide the Board with additional relevant information, in particular information on the identification of issues related to the supply of crisis-relevant products throughout the Union and on relevant future national level measures for the procurement, purchase or manufacturing of crisis-relevant products.

On the basis of the information collected through the monitoring activities conducted pursuant to this Article, the Commission shall regularly provide a report of the aggregated findings to the Board. That report shall constitute classified information. The Board shall meet to assess the results of that report and to identify, where appropriate, potential solutions to issues of common interest. Where relevant, the Commission, after consulting the Board, may invite national defence industry associations, main suppliers of crisis-relevant products referred to in Article 56(12), and experts from academia and civil society to such meetings.

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.

The Commission, upon consultation of the Board, shall identify relevant topics for the conduct of stress tests.

The Commission, taking into consideration the relevant topics identified pursuant to paragraph 1 of this Article, shall conduct and coordinate stress tests, including simulations that aim to anticipate and prepare for a supply crisis as referred to in Article 60, and in particular may:

The Commission may conduct stress tests as referred to in paragraph 2 on a regular basis. The Board shall provide recommendations regarding the frequency for the conduct of such stress tests.

The Commission shall invite representatives of all Member States to participate in stress tests as referred to in paragraph 2. Upon consultation of the Board, the Commission may also invite representatives of the High Representative, the EDA or other relevant actors to participate in those stress tests.

Upon a request by two or more Member States, the Commission may conduct stress tests in specific geographical areas or border regions in those Member States.

Upon completion of the stress tests conducted pursuant to this Article, the Commission shall communicate the results to the participating Member States. The Commission shall share with the Board a report with recommendations based on the results of those stress tests without undue delay. Those results and that report shall constitute classified information.

Where a competent authority of a Member State becomes aware of a risk of serious disruption in the supply of a crisis-relevant product or has concrete and reliable information of any other relevant risk factor or event materially affecting the supply of a crisis-relevant product, it shall alert the Board without undue delay.

In order to determine whether a risk of serious disruption in the supply of a crisis-relevant product should trigger an alert as referred to in paragraph 1, Member States shall take into account the following:

Where the Board or the Commission become aware of a risk of serious disruption in the supply of a crisis-relevant product or has concrete and reliable information of any other relevant risk factor or event materially affecting the supply of a crisis-relevant product, including on the basis of early-warning indicators, upon an alert pursuant to paragraph 1 or from international partners, the Commission shall, without undue delay, carry out the following preventive actions:

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.

A supply crisis shall be considered to occur where:

Where, pursuant to Article 59, the Commission or the Board becomes aware of a risk of serious disruption in the supply of crisis-relevant products or has concrete and reliable information on any other relevant risk factor or event materially affecting the supply of such products, the Commission, after consulting the Board, shall assess whether the conditions set out in paragraph 1 of this Article are met. That assessment shall take into account the potential impact and consequences of the supply-crisis state on the supply chains of the crisis-relevant products concerned within the Union, the results of stress tests conducted pursuant to Article 58, and assessments performed in other relevant Union crisis management frameworks. Where that assessment provides concrete and reliable evidence, the Commission may, after consulting the Board, propose to the Council to activate the supply-crisis state. Where it proposes to the Council to activate the supply crisis-state, the Commission shall inform the Parliament thereof.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may activate the supply-crisis state. The duration of the supply-crisis state shall be specified in the implementing act and initially shall not exceed 12 months. That implementing act shall also specify which of the measures set out in Articles 62 and 63 are activated. In addition, the implementing act may identify for which crisis-relevant products which are not defence products those measures are activated.

The Council, acting by qualified majority, may amend the proposal referred to in paragraph 3.

The Commission shall report on a regular basis and at least every three months to the Council and to the European Parliament on the state of the supply crisis.

Before the expiry of the duration of the supply-crisis state, the Commission, taking into consideration the recommendation of the Board, shall assess whether it is justified to prolong it. Where such assessment provides concrete and reliable evidence that the conditions for the activation of the supply-crisis state are still met, the Commission may, after consulting the Board, propose to the Council to prolong the supply-crisis state.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may prolong the supply-crisis state. The duration of the prolongation shall be limited to a maximum of 12 months and specified in the implementing act.

During the supply-crisis state, the Commission shall, after consulting the Board, assess the appropriateness of an early termination of the supply-crisis state. If the assessment so indicates, the Commission may propose to the Council to terminate the supply-crisis state.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may terminate the supply-crisis state before the expiry date specified in the implementing act referred to in paragraph 3 or 7.

During the supply-crisis state, the Commission shall, upon request from a Member State or on its own initiative, convene extraordinary meetings of the Board where necessary. In line with Article 76(10), the Board shall invite, where relevant, high-level industrial representatives to meet in special configuration in order to discuss issues related to crisis-relevant products. Member States shall work closely with the Commission within the Board in order to ensure the coordination of any Union and national measures taken with regard to the supply chains of the concerned crisis-relevant products which are not defence products.

Upon expiry of the period for which the supply-crisis state is activated or prolonged, or upon its early termination, the measures taken in accordance with Articles 62 and 63 shall immediately cease to apply. Implementing acts that have been adopted in accordance with Article 63(7) and (9) shall nevertheless continue to apply until the priority-rated requests or priority-rated orders concerned have been completed.

The Commission and Member States shall update the mapping and the monitoring of the Union’s defence supply chains pursuant to Articles 56 and 57, taking into account the experience from the supply crisis, no later than six months after the expiry or early termination of the supply-crisis state.

Where the supply-crisis state is activated pursuant to Article 60 and where necessary in order to address the supply crisis in the Union, the Commission may take the measures provided for in Articles 62 and 63, as specified in the implementing act adopted by the Council in accordance with Article 60(3).

The Commission shall, after consulting the Board, restrict the application of the measures referred to in paragraph 1 to the crisis-relevant products which are not defence products that are subject to serious disruption or at imminent risk of such disruptions on account of the supply crisis. The application of the measures referred to in paragraph 1 shall be proportionate and restricted to what is necessary for addressing serious disruptions or mitigating an imminent risk of such disruptions affecting the supply chains of the crisis-relevant products concerned in the Union and shall be in the best interest of the Union. The application of those measures shall avoid placing a disproportionate administrative burden, in particular on SMEs.

Where the supply-crisis state is activated pursuant to Article 60 and where appropriate in order to address the supply crisis in the Union, the Board shall assess and advise on appropriate and effective measures.

The Commission shall regularly inform the European Parliament and the Council of any measures taken in accordance with paragraph 1 and explain the reasons for its action.

The Commission shall, taking into consideration the recommendation of the Board, issue guidance on the implementation and the use of the measures provided for in Articles 62 and 63.

Where the Council activates the measure under this Article in accordance with Article 60(3), the Commission may, where the available information is not sufficient, request an economic operator contributing to the production of crisis-relevant products which are not defence products, with the prior agreement of the Member State on whose territory the production site of that economic operator is located, to provide information to that Member State within a set time limit about its production capabilities, production capacities and current primary disruptions. The Member State concerned shall make the requested information available to the Commission. The requested information shall be limited to what is necessary to assess the nature of the supply crisis or to identify and assess potential mitigation measures.

Before launching a request for information pursuant to paragraph 1, and with the prior agreement of the Member State on the territory of which the production site of the economic operator concerned is located, the Commission may carry out a voluntary consultation of a representative number of relevant economic operators with a view to identifying the appropriate and proportionate content of such a request. The Commission shall prepare the request for information in cooperation with the Board.

The Commission shall without undue delay forward a copy of the request for information to the national competent authority of the Member State on the territory of which the production site of the economic operator concerned is located.

The request for information shall:

Where the Member State concerned agrees to the launch of a request for information pursuant to paragraph 1, it may decide to address that request, as prepared by the Commission pursuant to paragraphs 2 and 4, directly to the economic operator concerned.

Each economic operator concerned, or a person duly authorised to represent that economic operator, shall supply the information requested on an individual basis to the Member State concerned.

The Member State concerned shall ensure that the requested information is made available without undue delay to the Commission.

If an economic operator established in the Union is subject to a request for information from a third country, related to its activities for the supply of crisis-relevant products which are not defence products, it shall inform the Member State on the territory of which its production site is located, in a timely manner. That Member State shall, in turn, inform the Commission, in such a manner as to enable the Member State concerned and the Commission to request similar information from the economic operator. The Commission shall inform the Board of the existence of such a request from a third country.

If an economic operator supplies incorrect, incomplete or misleading information in response to a request made pursuant to this Article, or does not supply the information within the prescribed time limit, it shall be subject to fines set in accordance with Article 72, except where the economic operator has sufficient reasons for not supplying the requested information or not supplying it within the prescribed time limit, in particular where the processing of the information request by an economic operator has the potential to significantly disrupt its operations, where the information is classified and marked as for national use only or where the disclosure of that information could significantly harm the economic operator’s business activity.

The Commission and the Member State concerned shall use secure means to launch the request for information and to handle any information acquired in accordance with Article 80.

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.

Where the Council activates the measure under this Article in accordance with Article 60(3), a Member State which faces severe difficulties either in the placing of an order or in the execution of a contract related to the supply of crisis-relevant products may submit a request to the Commission to request an economic operator to accept, or to prioritise, a certain order of crisis-relevant products which are not defence products.

Upon a request as referred to in paragraph 1, the Commission may, where the production or supply of crisis-relevant products which are not defence products cannot be achieved by any other measures provided for in this Chapter, address a request to the economic operator concerned after:

The request referred to in paragraph 2 shall include information about the legal basis for the request, specify the products, their specifications and quantities, specify the schedule and time-limit for performing and completing the order, and state the reasons justifying the use of the priority-rated request.

The Commission shall demonstrate that the choice of the recipients and beneficiaries of the request referred to in paragraph 2 is non-discriminatory and complies with Union competition rules.

The Commission shall base the request referred to in paragraph 2 on objective, factual, measurable and substantiated data, showing that such prioritisation is indispensable in order to ensure the proper functioning of the internal market, and having regard to the legitimate interests of the economic operator concerned and to the cost and effort required for any change in the production sequence of the supply chain.

The economic operator concerned shall reply to the Commission within five working days upon receipt of the request referred to in paragraph 2 and state whether it accepts or refuses the request. Where the urgency of the situation so requires, the Commission may, based on a justification of such urgency, request the economic operator to reply within a shorter deadline.

Where the economic operator to which the request referred to in paragraph 2 is addressed has expressly accepted that request, the Commission, by means of an implementing act, shall adopt a priority-rated request setting out:

Where the economic operator declines the request referred to in paragraph 2, it shall provide the Commission with a detailed justification for that refusal.

Having due regard to the justifications provided by the economic operator under paragraph 8 of this Article, and after consulting and receiving prior agreement of the Member State on the territory of which the production site of the economic operator concerned is located and the Member State on the territory of which the executive management structure of the economic operator is located, the Commission, by means of an implementing act, may adopt a priority-rated order imposing on the economic operator concerned an obligation to perform that order. The Commission shall state the reasons why, in line with the proportionality principle and the fundamental rights of the economic operator under the Charter of Fundamental Rights of the European Union and in light of the circumstances described in paragraph 1, it was necessary for it to adopt that implementing act. Any such implementing act shall provide the information referred to in paragraph 7.

The Commission shall not issue the priority-rated order in any of the following cases:

Priority-rated requests referred to in paragraph 7 and priority-rated orders referred to in paragraph 9 shall:

Economic operators subject to a priority-rated request pursuant to paragraph 7 or to a priority-rated order pursuant to paragraph 9 shall not be liable for any breach of contractual obligation that is governed by the law of a Member State, provided that:

Any conflict between a priority-rated request or a priority-rated order and a measure under any other prioritisation mechanism of the Union shall be discussed within the Board and resolved by the Commission, based on the weighing of the public interest.

The economic operator subject to a priority-rated request pursuant to paragraph 7 or to a priority-rated order pursuant to paragraph 9 may request the Commission to modify the implementing act referred to in paragraph 7 or 9 where it considers it to be duly justified based on one of the following grounds:

The economic operator shall provide all relevant and substantiated information to allow the Commission to assess the merits of the request for modification referred to in paragraph 14.

Based on the examination of the reasons and evidence provided by the economic operator, the Commission may, after consulting the Member State on the territory of which the production site of the economic operator concerned is located and the Member State on the territory of which the executive management structure of that economic operator is located, amend its implementing act to release, partially or in totality, the economic operator concerned from its obligations under this Article.

Where an economic operator established in the Union is subject to a measure of a third country which entails a priority-rated order or a priority-rated request of a crisis-relevant product which is not a defence product, it shall notify the Commission thereof. The Commission shall then inform the Board of the existence of such measure.

Where an economic operator subject to a priority-rated request pursuant to paragraph 7 or a priority-rated order pursuant to paragraph 9 intentionally, or through gross negligence, does not comply with that request or order, it shall be subject to fines set in accordance with Article 72, except where:

The Commission shall adopt an implementing act laying down the practical and operational arrangements for the functioning of priority-rated requests and priority-rated orders, including a methodology for the determination of the price of crisis-relevant products subject to priority-rated orders.

The implementing acts referred to in this Article shall be adopted in accordance with the examination procedure referred to in Article 77(4).

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 (b), TFEU.

A security-related supply-crisis shall be considered to occur where:

Where, pursuant to Article 59, the Commission or the Board becomes aware of a risk of serious disruption in the supply of crisis-relevant defence products or has concrete and reliable information of any other relevant risk factor or event materially affecting the supply of such products, the Commission, after consulting the Board, shall assess whether the conditions set out in paragraph 1 of this Article are met. That assessment shall take into account the potential impact and consequences of the security-related supply-crisis state on the defence supply-chains within the Union, the results of stress tests conducted pursuant to Article 58, and assessments performed in other relevant Union crisis management frameworks. Where that assessment provides concrete and reliable evidence, the Commission may, after consulting the Board, propose to the Council to activate the security-related supply-crisis state. Where it proposes to the Council to activate the security-related supply crisis-state, the Commission shall inform the Parliament thereof.

When assessing if the conditions set out in paragraph 1 of this Article are met pursuant to paragraph 2, the Commission shall, in particular, take into account whether a crisis affecting the security and defence interests of the Union and its Member States has been identified within the area of CFSP, such as whether that crisis has triggered the activation of the mutual assistance clause pursuant to Article 42(7) TEU.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may activate the security-related supply-crisis state. The duration of the security-related supply-crisis state shall be specified in the implementing act and initially shall not exceed 12 months. That implementing act shall also specify which of the measures set out in Articles 65 to 71 are activated. In addition, the implementing act may identify for which crisis-relevant defence products those measures are activated.

The Council, acting by qualified majority, may amend the proposal referred to in paragraph 4.

The Commission shall report on a regular basis and at least every three months to the Council and to the European Parliament on the state of the security-related supply crisis.

No later than three weeks before the expiry of the duration of the security-related supply-crisis state, the Commission, taking into consideration the recommendation of the Board, shall submit to the Council a report, assessing whether that duration should be prolonged. The report shall in particular analyse the impact of the measures previously activated under this Chapter. Where such assessment provides concrete and reliable evidence that the conditions for the activation of the security-related supply-crisis state are still met, the Commission may, after consulting the Board, propose to the Council to prolong the security-related supply-crisis state.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may prolong the security-related supply-crisis state. The duration of the prolongation shall be limited to a maximum of 6 months and specified in the implementing act. That implementing act shall also specify which of the measures set out in Articles 65 to 71 continue to be applied or, where relevant, are activated. The Council, acting by qualified majority, may repeatedly decide to prolong the period for which the security-related supply-crisis state is activated where so justified to address the security-related supply crisis.

The Commission may propose to the Council to prolong the security-related supply-crisis state as many times as considered necessary to address the security-related supply crisis, subject to the conditions set out in paragraph 7. Upon such proposal from the Commission, paragraph 8 shall apply.

During the security-related supply-crisis state, the Commission shall, after consulting the Board, assess the appropriateness of an early termination of the security-related supply-crisis state. If the assessment so indicates, the Commission shall propose to the Council to terminate the security-related supply-crisis state.

The Council, by means of an implementing act adopted by qualified majority upon a proposal from the Commission, may terminate the security-related supply-crisis state before the expiry date specified in the implementing act referred to in paragraph 4 or 8.

Upon expiry of the period for which the security-related supply-crisis state is activated or prolonged or upon its early termination, the measures taken in accordance with Articles 65 to 71 shall immediately cease to apply. Implementing acts that have been adopted in accordance with Article 66(6) shall nevertheless continue to apply until the priority-rated requests concerned have been completed.

Where the security-related supply-crisis state is activated, the Commission may propose to the Council to activate the measures provided for in Articles 62 and 63, under the conditions laid down therein and in Articles 60 and 61.

Where the Council activates the measure under this Article in accordance with Article 64(4), a Member State may submit a request to the Commission to request an economic operator whose production site is located on its territory to accept, or to prioritise, a certain order of crisis-relevant defence products in order to address the severe difficulties that Member State or another Member State faces either in the placing of an order or in the execution of a contract for the supply of such products.

Upon a request as referred to in paragraph 1, the Commission may, where the production or the supply of crisis-relevant defence products cannot be achieved by any other measure provided for in this Chapter, address a request to the economic operator concerned after:

The request referred to in paragraph 2 shall include information about the legal basis for the request, specify the products, their specifications and quantities, specify the schedule and time-limit for performing and completing the order, and state the reasons justifying the use of the priority-rated request.

The Commission shall demonstrate that the choice of the recipients and beneficiaries of the request referred to in paragraph 2 is non-discriminatory and complies with Union competition rules.

The Commission shall base the request referred to in paragraph 2 on objective, factual, measurable and substantiated data, showing that such prioritisation is indispensable in order to ensure the proper functioning of the internal market, and having regard to the legitimate interests of the economic operator concerned and to the cost and effort required for any change in the production sequence of the supply chain.

Where the economic operator to which the request referred to in paragraph 2 is addressed has expressly accepted that request, the Commission, by means of an implementing act and after the consultation and prior agreement of the Member State on the territory of which the production site of the economic operator concerned is located and of the Member State on the territory of which the executive management structure of the economic operator concerned is located, shall adopt a priority-rated request setting out:

The priority-rated requests referred to in paragraph 6 shall:

The economic operator subject to a priority-rated request pursuant to paragraph 6 shall not be liable for any breach of contractual obligation that is governed by the law of a Member State, provided that:

The economic operator subject to a priority-rated request may request the Commission to modify the implementing act referred to in paragraph 6 where it considers it to be duly justified based on one of the following grounds:

The economic operator shall provide all relevant and substantiated information to allow the Commission to assess the merits of the request for modification referred to in paragraph 9.

Based on the examination of the reasons and evidence provided by the economic operator, the Commission may, after consultation and prior agreement of the Member State on the territory of which the relevant production site of the economic operator concerned is located and the Member State on the territory of which the executive management structure of that economic operator concerned is located, amend its implementing act to release, partially or in totality, the economic operator concerned from its obligations under this Article.

Where an economic operator, after having expressly accepted to prioritise the orders requested by the Commission, intentionally or through gross negligence does not comply with the obligation to prioritise those orders, it shall be subject to fines set in accordance with Article 72, except where:

When an economic operator established in the Union is subject to a measure of a third country which entails a priority-rated request of a crisis-relevant defence product, it shall notify the Commission thereof. The Commission shall inform the Board of the existence of such measures. Where relevant, the Commission may consult with the Board on any appropriate step to be taken in response to that measure.

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)(b) TFEU.

Where the Council activates the measure under this Article in accordance with Article 64(4) of this Regulation, and without prejudice to Directive 2009/43/EC and Member States’ prerogatives under that Directive, Member States shall ensure that applications related to intra-EU transfers 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. The Council implementing act referred to in Article 64(4) of this Regulation shall specify the timeframe within which national authorities concerned shall treat the applications once they have received all necessary information from the applicant. That timeframe shall not be longer than two weeks.

Where a Member State imposes, in accordance with Article 4(8) of Directive 2009/43/EC, export limitations on components which are crisis-relevant products, that Member State shall not require further authorisations for the intra-EU transfer of the components concerned where the recipient provides a declaration of use in which it declares that the components subject to that transfer licence are integrated or are to be integrated into a defence product and cannot be transferred or exported as such. This shall be without prejudice to the obligations of recipients laid down in Article 10 of Directive 2009/43/EC.

Where the Council activates the measure under this Article in accordance with Article 64(4), Member States shall ensure that administrative procedures related to the certification of crisis-relevant defence products and, where necessary, technical adaptations of such products are processed in the most rapid way possible, in accordance with their applicable national laws and regulations.

Where such a status exists in national law, certification of crisis-relevant defence products shall be allocated the status of the highest possible significance.

Where this measure is activated, crisis-relevant defence products certified in a Member State shall be deemed certified in another Member State without being subject to additional control.

The implementing act referred to in Article 64(4) may lay down more precise provisions on the scope of this measure.

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 (b), TFEU.

Where the Council activates the measure under this Article in accordance with Article 64(4) of this Regulation and where Directive 2003/88/EC of the European Parliament and of the Council (46) applies to the relevant production activities, Member States may decide to use, or to encourage economic operators whose production sites are located on their territory and which produce the crisis-relevant defence products concerned to make use of, derogations provided for in Article 17(3) of Directive 2003/88/EC in order to allow for the expansion of working shifts thereby facilitating continuity of production of the crisis-relevant defence products concerned, if they deem it necessary to achieve the objectives of this Regulation.

Where prior authorisation is required, all national authorities concerned shall ensure that the most rapid treatment legally possible is given to applications from economic operators producing crisis-relevant defence product to use the derogations referred to in paragraph 1.

Where it deems it to be necessary and proportionate, the Commission may, by way of implementing acts, impose on the economic operators that are addressees of information requests pursuant to Article 62 or that are subject to any of the obligations to inform the Commission of a third-country obligation pursuant to Article 63(17) and Article 66(13) or to prioritise the production of crisis-relevant products pursuant to Articles 63 and 66, the following fines or penalties:

Before taking a decision pursuant to paragraph 1 of this Article, the Commission shall provide an opportunity for the economic operator concerned to be heard in accordance with Article 75. The Commission shall take into account any duly reasoned justification presented by the economic operator for the purpose of determining whether fines or periodic penalty payments are deemed necessary and proportionate.

In fixing the amount of the fine or periodic penalty payment, the Commission shall take into consideration the nature, gravity and duration of the infringement, including, in relation to cases of non-compliance with the obligation to accept or prioritise a priority-rated order set out in Article 63(9) or a priority-rated request set out in Article 63(7) or Article 66(6), whether the economic operator has partially complied with the priority-rated order or the priority-rated request.

The fines shall constitute external assigned revenue within the meaning of Article 21(5) of the Financial Regulation and shall be directed to the Ukraine Support Instrument.

The powers conferred on the Commission by Article 72 shall be subject to the following limitation periods:

The limitation periods referred to in paragraph 1 shall begin to run on the day on which the infringement is committed. Where there are continuous or repeated infringements, the limitation periods shall begin to run on the day on which the last infringement was committed.

Any action taken by the Commission or the competent authorities of the Member States for the purpose of ensuring compliance with this Regulation shall interrupt the limitation period.

The interruption of the limitation period shall apply for all the parties which are held responsible for participation in the infringement.

Each interruption of the limitation period shall start that limitation period running afresh. However, the limitation period shall expire at the latest on the day on which a period equal to twice the limitation period has elapsed without the Commission having imposed a fine or a periodic penalty payment. That period shall be extended by the time during which the limitation period is suspended because the decision of the Commission is the subject of proceedings pending before the Court of Justice of the European Union.

The power of the Commission to enforce decisions taken pursuant to Article 72 shall be subject to a limitation period of three years.

The limitation period shall begin to run on the day on which the decision becomes final.

The limitation period for the enforcement of fines and periodic penalty payments shall be interrupted by:

Each interruption as referred to in paragraph 3 shall start the limitation period running afresh.

The limitation period for the enforcement of fines and periodic penalty payments shall be suspended for as long as:

Before adopting a decision pursuant to Article 72, the Commission shall ensure that the economic operators concerned have been given the opportunity to submit observations on:

The economic operators concerned may submit to the Commission their observations on the Commission’s preliminary findings within a time limit which shall be fixed by the Commission in its preliminary findings, and which may not be less than 14 working days.

The Commission shall base its imposition of fines or periodic penalty payments only on objections on which the economic operators concerned have been able to comment.

Where the Commission has informed the economic operators concerned of its preliminary findings as referred to in paragraph 1, it shall give access, if so requested, to the Commission’s file under the terms of a negotiated disclosure, subject to the legitimate interest of economic operators in the protection of their business secrets, or in order to preserve business secrets or other confidential information of any person. The right of access to the file shall not extend to confidential information and internal documents of the Commission or the authorities of the Member States, in particular to correspondence between the Commission and the authorities of the Member States. Nothing in this paragraph shall prevent the Commission from disclosing and using information necessary to prove an infringement.

The Defence Security of Supply Board (the ‘Board’) is hereby established.

The general task of the Board is to assist and provide recommendations to the Commission pursuant to this Chapter.

The Commission shall maintain a regular flow of information to the Board on any planned measures and on measures that have been taken following the activation of the supply-crisis states pursuant to Article 60 or 64. The Commission shall provide the necessary information through a secured IT system.

For the purposes of preparing for and addressing a supply-crisis state referred to in Article 60 or 64, the Board shall assist the Commission in:

The Board shall be composed of representatives from all Member States, the Commission, the High Representative and the EDA. It shall be co-chaired by a representative of the Commission and of the Member State holding the rotating presidency of the Council. The secretariat of the Board shall be ensured by the Commission. Only Member States shall have voting rights.

The co-chairs shall invite representatives of the European Parliament to attend, as observers, the meetings of the Board.

Associated countries shall have the right to become members, without voting rights, of the Board in accordance with the conditions set out under the Agreement on the European Economic Area.

The Board shall meet whenever the situation requires, upon request from the Commission, a Member State or an associated country which has become a member of the Board. The Board shall adopt its rules of procedure on the basis of a proposal submitted by the Commission. Those rules of procedure shall provide mechanisms to ensure the good functioning of the Board in carrying out its tasks, including by foreseeing dispute resolution procedures related to potential disputes between the co-chairs.

The Board may issue recommendations, upon the request of the Commission or on its own initiative. The Board shall endeavour to find solutions which command the widest possible support.

The Board shall invite, at least once a year, representatives from national defence industry associations and selected industrial representatives to take part, as observers, in its work, taking into account the necessity to ensure a balanced geographical representation. Where a supply-crisis state referred to in Article 60 or 64 has been activated, the Board shall invite, where relevant, high-level industrial representatives to take part, as observers, in its work, meeting in a special configuration in order to discuss issues linked to crisis-relevant products or, where a security-related supply-crisis state under Article 64 has been activated, the defence products concerned.

The Board shall invite the representatives of other crisis-relevant bodies at Union level as observers to its relevant meetings.

The Board shall invite, where relevant, in line with its rules of procedure and with due respect to the security and defence interests of the Union and its Member States, a representative from Ukraine to attend meetings as an observer.

The Commission shall ensure inclusiveness and provide members of the Board with equal access to information in order to ensure that the decision-making process of the Board reflects the situation and the needs of all Member States. The Board shall take the necessary measures to ensure the safe handling and processing of classified and sensitive information in accordance with Articles 79 and 80.

The Commission may, on its own initiative or acting on a proposal from the Board, set up working groups on an ad hoc basis to support the Board in its work for the purpose of examining specific questions on the basis of the tasks referred to in paragraph 1. Member States shall nominate experts for those working groups. The EDA may be invited to meetings of such working groups.

The Commission shall set up a working group within the meaning of paragraph 14 on legal, regulatory and administrative hurdles. The objectives of that working group shall be:

The Commission shall be assisted by a committee. That committee shall be a committee within the meaning of Regulation (EU) No 182/2011.

The EDA shall be invited to provide its views and expertise to the committee as an observer. The European External Action Service shall also be invited to assist in the work of the committee.

The Commission may, on its own initiative or upon request from one or more Member States, invite, where relevant, representatives of Ukraine to attend meetings of the committee. Representatives of Ukraine shall not be present during deliberations or participate in voting of the committee.

Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.

Where the committee delivers no opinion, the Commission shall not adopt the draft implementing act and Article 5(4), third subparagraph, of Regulation (EU) No 182/2011 shall apply.

The Commission shall conclude with Ukraine a financing agreement within the meaning of Article 114(2) of the Financial Regulation for the implementation of the actions set out in this Regulation which concern Ukraine or legal entities established in Ukraine receiving Union funds.

The financing agreement concluded with Ukraine and contracts and agreements signed with legal entities established in Ukraine receiving Union funds, shall ensure that the obligations set out in Article 129 of the Financial Regulation can be fulfilled.

The financing agreement shall lay down the obligations of the Ukrainian authorities and bodies entrusted with budget implementation tasks to take all necessary measures, including legislative, regulatory and administrative measures, to respect the principles of sound financial management, transparency and non-discrimination, to ensure the visibility of Union action when managing the Union funds, to fulfil the appropriate control and audit obligations and assume the resulting responsibilities, and to protect the financial interests of the Union, by, in particular, detailed enacting provisions concerning:

Funding shall only be granted to Ukraine after the financing agreement has entered into force and the actions needed to implement the requirements it establishes have been implemented by the parties.

The Commission shall ensure that, from its side, all necessary steps are taken for the financing arrangement to become effective no later than 1 July 2026.

Classified information that is created, handled, stored, exchanged or shared under this Regulation shall be protected in accordance with the security rules set out in Commission Decision (EU, Euratom) 2015/444 (48) or the Agreement between the Member States of the European Union, meeting within the Council, regarding the protection of classified information exchanged in the interests of the European Union, as appropriate.

The participating Member States shall decide who is the originator of classified foreground information generated in the implementation of eligible actions listed under Article 10.

The Commission shall have access to the classified information necessary for carrying out the tasks assigned to it under this Regulation concerning the eligible actions listed under Article 10.

In the context of a SEAP, the rules on the protection of classified information referred to in Article 45(1), point (n), shall comply with paragraph 1 of this Article.

Where a SEAP includes associated countries or Ukraine among its members or observers, such SEAP shall ensure a level of protection equivalent to that afforded by the Agreement between the Member States of the European Union, meeting within the Council, regarding the protection of classified information exchanged in the interests of the European Union.

The applicable security framework for an action shall be put in place by participating Member States at the latest before the signature of the grant agreement or the contract. The relevant documents shall form an integral part of the grant agreement or the contract.

The Commission shall set up a system that is security accredited in accordance with Decision (EU, Euratom) 2015/444 in order to facilitate the exchange of classified information between the Commission and the Member States and associated countries, and, where appropriate, with the applicants and the recipients.

Information received as a result of the application of this Regulation shall be used only for the purpose for which it was requested.

Member States, the Commission, the European External Action Service and the EDA shall ensure the protection of trade and business secrets and other sensitive information acquired and generated in application of this Regulation in accordance with Union law and respective national law.

The Commission shall handle information containing any data of an entity or any trade secrets in a way not less stringent than the handling of sensitive information, including the application of the ‘need-to-know-principle’ and the use of appropriate encrypted environments for the handling and sharing of such information.

Where an associated country participates in the Programme by means of a decision adopted pursuant to the Agreement on the European Economic Area or on the basis of any other legal instrument, the associated country shall grant the necessary rights and access required for the authorising officer responsible, OLAF and the European Court of Auditors to comprehensively exercise their respective competences. In the case of OLAF, such rights shall include the right to carry out investigations, including on-the-spot checks and inspections, as provided for in Regulation (EU, Euratom) No 883/2013.

The agreement referred to in Article 78 shall provide for the obligations of Ukraine:

The recipients of Union funding shall acknowledge the origin of the funds and ensure the visibility of that funding, in particular when promoting the actions and their results, by providing coherent, effective and proportionate targeted information to multiple audiences, including the media and the public.

The Commission shall implement information and communication actions relating to this Regulation, to actions taken pursuant to this Regulation, and to the results obtained.

Financial resources allocated to the Programme and to the Ukraine Support Instrument shall contribute to the corporate communication of the political priorities of the Union, in so far as those priorities are related to the objectives referred to in Articles 4 and 22.

Financial resources allocated to the Programme and to the Ukraine Support Instrument may contribute to the organisation of dissemination activities, match-making events and awareness-raising activities, in particular aiming to open up supply chains to foster the cross-border participation of SMEs.

The Commission shall monitor the implementation of the Programme and of the Ukraine Support Instrument on a regular basis and report annually on progress made, including on the level of involvement of SMEs and small mid-caps and on the overall expenditure of the Programme and the Ukraine Support Instrument broken down by type of actions and by form of Union contribution, to the European Parliament and to the Council.

By 30 June 2027, the Commission shall draw up a report, based on indicators where appropriate, evaluating the implementation of the measures set out in this Regulation and their results and assessing the need for a possible revision of this Regulation. The evaluation report shall build on consultations of the Member States and key stakeholders and shall evaluate the contribution of this Regulation to the progress made towards increasing the value of defence equipment procured in the Union in a collaborative manner, the value of intra-EU defence trade and the value of Member States’ defence investment procured in the Union.

The Commission shall present the report to the European Parliament and the Council, accompanied, where appropriate, by relevant legislative proposals.