Defense companies from the United States, the United Kingdom, and Turkey will be excluded from a new EU defense financing initiative worth 150 billion euros unless their home countries sign defense and security agreements with Brussels.
The planned fund for capital to be spent on weapons will only be open to defense companies from the EU and those from third countries that have signed defense agreements with the bloc, according to a proposal from the European Commission presented on Wednesday, reports Financial Times, as relayed by Klankosova.tv.
It will also exclude any advanced weapon system over which a third country had “design authority” – restrictions on building or using specific components – or control over its eventual use.
This would exclude the American “Patriot” air and missile defense platform, produced by defense contractor RTX, and other US weapon systems where Washington imposes restrictions on where they can be used.
This policy is a win for France and other countries that have called for a “Buy European Products” approach to pushing defense investments on the continent, driven by fears about the long-term reliability of the US as a partner and supplier, especially under President Donald Trump.
At least 65% of the cost of products would need to be spent within the EU, Norway, and Ukraine. The remaining portion could be spent on products from third countries that have signed a security pact.
“We have this opportunity to really build the European defense industry,” said Kaja Kallas, the EU’s chief diplomat, adding that the war in Ukraine has demonstrated the importance of having weapons without foreign restrictions. “In crisis, your army really needs to have its hands free.”
The UK has lobbied strongly to be included in the initiative, especially considering its key role in a “European coalition of will” aimed at strengthening the continent’s defense capabilities. UK defense companies, including “BAE Systems” and “Babcock International,” are deeply integrated into the defense industries of EU countries such as Italy and Sweden.
If third countries like the US, UK, and Turkey want to participate in the initiative, they would need to sign a defense and security partnership agreement with the EU.
Talks between London and Brussels for such a pact have begun but are caught up in demands for a broader EU-UK agreement that would also include issues such as fishing rights and migration.
“We are working to have this defense and security partnership with the United Kingdom,” said Kallas. “I really hope that by the summit (EU-UK) in May, we can have results.”
The exclusion of the UK and Turkey would damage major European defense companies with close ties to producers or suppliers in those markets.
Previous French efforts to limit defense spending to EU companies have faced stiff resistance from countries such as Germany, Italy, Sweden, and the Netherlands, which have strong ties to defense manufacturers outside the EU.
The proposal still needs to be approved by a majority of EU states.
According to the plan’s terms, EU countries would be able to spend 35% of the credits on products using components from Norway, South Korea, Japan, Albania, Moldova, North Macedonia, and Ukraine, said officials.
