Council adopts measures to incentivise and simplify defence investments in the EU
Today the Council formally adopted the regulation incentivising defence-related investments in the EU budget to implement the ReArm Europe Plan. The regulation brings legal adjustments aimed at supporting faster, more flexible and coordinated defence-related investments across the EU.
With this adoption, the Council responds to the repeated calls from the European Council to facilitate the deployment of EU funding for defence and dual-use technologies, and to strengthen Europe’s defence industrial and technological base (EDTIB) in the face of mounting geopolitical challenges.
The adopted regulation amends five key EU programmes – the Digital Europe Programme, the European Defence Fund, the Connecting Europe Facility, the Strategic Technologies for Europe Platform (STEP), and Horizon Europe – to ensure they can be more effectively used to support defence-related activities.
Opportunities for Ukraine entities
Among other things, the new rules allow for Ukraine to be associated to the European Defence Fund, thereby creating new opportunities for Ukrainian entities to join in EU collaborative defence research and development activities in the future. This step underscores the EU’s enduring commitment to Ukraine’s security, resilience, and gradual integration into the European defence and technological industrial base.
More support for dual-use and defence companies
Furthermore, the scope of Horizon Europe is undergoing a targeted extension. While the overall civilian nature of that framework programme for research and innovation is maintained, one specific EU financing instrument under Horizon (the ‘EIC accelerator’) will be able to support also dual-use and defence-related companies in the future. New rules on the establishment and control of eligible entities similar to those agreed in the context of SAFE (‘Security Action for Europe Instrument’) or EDIP (‘European Defence Industry Programme’) for the targeted extension will allow taking into account the specificity of such activities.
Additional amendments to the Digital Europe Programme, STEP and the Connecting Europe Facility are made, all with a view to mobilising those Union programmes for defence investments.
Next steps
The Council adopted the regulation via written procedure, following the positive vote of the European Parliament on 16 December. It will enter into force on the day following that of its publication in the Official Journal of the European Union.
Background
The so-called ‘mini-Omnibus for defence’ is a package of legal changes proposed by the European Commission in April 2025 to make it easier for existing EU programmes to support projects with dual-use or defence applications.
This initiative is complemented by the so-called defence readiness omnibus package presented in June 2025 by the Commission on which inter-institutional negotiations are expected to start next year. Both proposals aim to incentivise defence-related investments and improve Europe’s defence readiness, as requested by the European Council in March 2025.