Brussels, 05/12/2007 (Agence Europe) - On Wednesday 5 December, the European Commission presented a “defence” package that includes: a communication outlining a variety of recommendations for increasing competitiveness in the sector; a directive on public procurement in defence for a greater opening up and increased competition in member states' defence markets; a directive on intra-Community defence-linked defence products that aims to reduce trade barriers for these products in the Union. A Commission press release explained that this package (of which we summarised the legislative aspects in EUROPE 9551 and 9556) is expected to help create a genuine European market in a sector where, “member states will remain masters in the protection of essential interests and their defence and security”.
In its communication, the Commission mentions a certain number of other actions likely to enhance competitiveness in the sector. Notably, the Commission intends to: promote use of common standards (a task it is attempting to tackle in close cooperation with the European Defence Agency); use of available legal instruments to guarantee fair competition in defence equipment; examine the opportunity of creating a European information security system; in 2008 the launch of a study of future control modalities on foreign investment in strategic defence companies, by focusing on solutions guaranteeing competitiveness and supply at a European level and which do not have an impact on the security interests of member states; encouragement of increased coordination across-the-board with and between member states, in a way that obtains optimum performance levels while using the most cost-effective solutions.
Günter Verheugen, Commission vice president, in charge of enterprise and industrial policies presented the package to the press. He highlighted the importance this package had on the competitiveness of an “industrial, technological and autonomous defence basis and on our strategic independence”. He pointed out that although the defence market in Europe was worth around an annual €80bn, the cost of administrative procedures linked to intra-Community trade cost nearly €400 million a year. 11,500 export licences for intra-Community transfers have been requested every year since 2003 and none have been refused. Günter Verheugen in this way justified the simplification of administrative procedures that would result from the draft directive on intra-Community transfers and sought to provide assurances about the security of the proposed system (he stressed that participating companies would be subject to certification) and on the freedom of member states to impose individual licences for the export of sensitive materials. The Commission vice president was also keen to point out that this text would only have an effect on the capacity of the six countries cooperating within the L.O.I (Letter of Intent: inter-governmental agreement bringing together the six main arms producers: the United Kingdom, France, Germany, Sweden, Italy and Spain).
Commissioner Charlie McCreevy, in charge of the internal market, underlined that adoption of transparent rules for public procurement that promoted competition should be applied in the whole of the Union. He also affirmed that this would be crucially important for implementation of a common defence market. Asked about the entry into force of the directive, which focuses on the use of negotiated procedures with publication, restricted procedure and competitive dialogue remaining possible, the Commissioner explained that the adoption of the text could take place quite soon in 2008. He stated that the Commission would ensure that correct application of Community law took place in this domain.
In a press release, the European Defence Agency welcomed the efforts of the European Commission in supporting the development of a genuine European defence equipment market. The Commission package has just completed the work of the agency to strengthen the industrial and technological base of European defence (EDTIB). The EDA stressed that, “competition is a key instrument in a wider whole, which includes other important initiatives, such as agreements on security of supply and security of information, subjects on which the agency is currently working”. However, the press release added, “competition is not the panacea and cooperation can, in certain cases, be more appropriate in building the EDTIB of tomorrow”. Up to now, 200 contract proposals for a total amount of €10bn have been published in the EDA's electronic bulletin. 8 cross-border contracts have been concluded for a total of €44 million. (O.J.)