Position Paper on the Revision of the EU Defence Procurement Directive

Usefulness, efficiency, effectiveness and simplification of the EU procurement rules in the area of defence and security
While Directive 2009/81/EC establishes a common EU framework, it falls short of fully meeting its objectives. It does not provide sufficiently clear, risk-based urgency pathways for rapid acquisition when time is critical, which in practice results in lengthy and formalised procedures even when rapid acquisition is essential.
A further limitation is that EU defence funding and procurement rules treat all procurement types similarly, despite significant differences between them. For example, there are fundamental differences between (a) acquiring missionready products and systems, and (b) developing new, unproven capabilities. The latter requires dedicated innovation tracks: tailored and riskproportionate processes in early phases, explicit risksharing mechanisms, and decision criteria that prioritise speed, adaptability and performance. Additionally, current procurement rules are primarily rooted in material and product logic, even when procurement is in practice a delivery of expertise and change. An updated Defence Procurement Directive should more clearly support service procurement through contract forms and evaluation models that work for iterative deliveries, life-cycle responsibility and rapid provision of specialist expertise.
Part of the complexity with current procurement rules often stems not from EU directives themselves, but from how Member States interpret and apply them—especially through defence-related exemptions and varying classification regimes. This increases costs and administrative burdens for both industry and authorities. Member States differ in legal traditions, defence needs and industrial structures, leading to natural variation in how procurement rules are transposed and applied. We therefore welcome simplification, while recognising that not all challenges can be resolved through legislation alone.
Persistent divergence across Member States different interpretations, security classifications and clearance requirements creates friction in cross-border cooperation. Standardisation is crucial where it enables interoperability, safety, reliability and economies of scale (e.g., ammunition and common interfaces). However, it should remain risk-based and proportionate, and avoid becoming a rigid substitute for performance- and outcome-based procurement. The concern is therefore not standards per se, but their application: prescriptive, non-open or prematurely fixed standards can reduce design space, hinder rapid iteration and inadvertently restrict competition in areas where modularity, open interfaces or functional requirements would better support innovation—without compromising classified information. Combined with slow procurement cycles and fragmented national implementation, this undermines predictability and efficiency. -related exemptions and varying classification regimes. This increases costs and administrative burdens for both industry and authorities.
To improve responsiveness and reduce unnecessary barriers, we recommend:
a. shifting emphasis from rigid pre-qualification and prescriptive technical requirements towards risk-based, performance-oriented procurement where capability outcomes are specified and contract performance is verified, without weakening necessary security requirements;
b. allowing more agile contract models, including framework agreements with predefined options/reopening clauses (and, where relevant, joiner clauses for additional Member States);
c. introducing common EU standard templates (RFI/RFP, qualification, SoW, contract terms, SoS clauses, IPR clauses) for defence procurement, where appropriate;
d. establishing mutual recognition of security clearances and facility approvals where equivalent minimum standards are met;
e. ensure access to a secure digital procurement channel for identity, data exchange and encrypted communication in cross-border procurement;
f. enable structured and early pre-procurement dialogue.

Cooperation between Member States, including joint procurement
From an industry point of view, it is not mainly the Procurement Directive that incentivise defence cooperation, but rather political processes and other instruments like EDF, SAFE, EDIP etc. Over time, joint R&D will bring Member States to also procure together.
Procurement rules might support as well as hinder cooperation. The current framework provides limited practical support for how joint procurement should be structured, including how more states can join after award, how requirements are harmonised, and how confidentiality is handled in larger consortia. For the industry, predictability regarding governance, volumes, and limits of liability is crucial for investing in capacity.

Regarding the Part B.5.a of the questionnaire: From an industry point of view most of these suggestions could facilitate common procurement. Some important factors are:

• Clear joining mechanisms in contracts so that more Member States can join if necessary, without restarting the entire procurement process.
• Joint planning and pipeline transparency at a level that does not disclose sensitive information, to enable capacity and competence building.
• Financial incentives linked to standardisation and interoperability, as well as life-cycle costs.
  However, the most important factor is to engage in dialogue with the industry.
  Transparency, openness and procurement procedures
  

Maintaining confidentiality in defence procurement is often essential to not disclose sensitive information to potential adversaries. Therefore, confidentiality will always limit transparency, but today uncertainty is often greater than necessary. It is possible to provide non-sensitive advance information that allows more parties to prepare, build the right partnerships and invest in relevant security arrangements.
Transparency should be differentiated. For market transparency, controlled visibility of upcoming needs, qualification requirements and non-sensitive parts is often sufficient. Post-award reporting must be designed so that aggregated information cannot be used to map capabilities, preparedness or weaknesses.
Government to government exemptions are sometimes essential to secure critical capabilities and protect sensitive information, but their application varies significantly across Member States, reducing predictability for suppliers. Clearer EU level guidance on when such exemptions are appropriate — and how to structure processes without compromising classified information — would improve transparency and certainty.
Innovation and the participation of startups, scale-ups, SMEs and midcaps
Innovation
Making existing procurement procedures more flexible and innovation-friendly can be effective, provided that requirements focus on performance and desired outcomes rather than prescribing technical solutions. This would allow suppliers to propose new approaches and broaden participation. Demand aggregation and collaborative procurement can further create sufficient scale to justify R&D investments, reduce risk, and make it more attractive for companies to bring new solutions to market.
Early market engagement and dialogue between industry and authorities are crucial, as clear demand signals encourage industry to invest in developing new capabilities. Innovation-friendly IPR conditions would also help companies capitalise on their technologies across markets, increasing returns on R&D. Likewise, limiting disproportionate participation requirements would enable startups and SMEs to compete, while risks for contracting authorities can be mitigated through mechanisms such as licensing.
Startups, scale-ups, SMEs and midcaps
From an SME perspective, a disproportionate share of funding and attention goes to large primes. Processes, requirements and expectations are designed around how primes operate. This favours incremental, predictable improvements over disruptive, problem-driven innovation. For a resilient, competitive and fast-adapting European defence, EU funding must deliberately open more space for SMEs, startups and mid-caps, not just as component suppliers but as owners of new capabilities and concepts. Funding and procurement rules should actively enable cooperation between primes and SMEs, ensuring that both types of actors can play to their strengths in joint programs.
Predictability and harmonisation are essential for SMEs to participate. Variations in process choices, documentation requirements and interpretations between contracting authorities – and between Member States – increase transaction costs and make it difficult for new actors to justify investing in market entry. From an SME perspective the EU revision should prioritise harmonised minimum requirements and standardised templates to reduce administrative burden and enable broader participation.
SOFF also see a need to protect the subcontractor market for the defence sector. Much of the expertise and innovation that the sector needs are found in the subcontractor segment.

Provisions that enable structured dialogue on the position and rights of subcontractors, would therefore be valuable.
Another important aspect of simplification is to lower unnecessarily high entry requirements—such as turnover thresholds, reference demands and extensive documentation—when the risk level does not justify them. For service and expertbased procurements, proportionality and riskbased assessment must be clearer guiding principles; otherwise, competition is weakened and new competence fails to enter the system.
Encouraging the division of contracts into smaller lots can significantly improve access for specialised Startups, Scaleups, SMEs and Mid-Caps. These companies often excel in narrow, high-innovation areas but cannot compete for broad, multi-component contracts. Smaller lots therefore broaden the competitive base and increase the likelihood that highly innovative solutions can enter the market.
Faster and more flexible payment schemes — including pre-financing and direct payments to subcontractors — are equally important. Many smaller companies face liquidity constraints, and improved cash-flow mechanisms would strengthen their ability to retain key staff and continue developing and delivering innovative products.
Security of supply and security of information
Security of supply in a crisis requires, among other things, clear SoS requirements in contracts, effective prioritisation mechanisms, redundancy where possible, as well as a realistic understanding of certification chains and potential single points of failure. To be meaningful SoS provisions must become more operational: they should include requirements for stockpiling critical components, defined prioritisation rules in crisis scenarios e.g. given battlefield operational lifetime, clear escalation pathways and the ability to rapidly activate option volumes.
Security requirements are necessary but should be made more predictable and harmonised.

European preference
Summary
A European preference can help strengthen the EDTIB if it is designed to increase actual capability (availability, delivery time, interoperability, SoS) rather than becoming a formal origin filter. The preference should therefore: (1) be based on value creation in the final delivery rather than component origin at each level, (2) include exceptions/safeguards when EU alternatives are not reasonable in terms of time, cost or technical compatibility, (3) differentiate between strategic capability areas, and (4) take into account European partners outside the EU when this strengthens Europe’s defence capabilities and interoperability.

General comments
We welcome initiatives to support an expanded European defence market, and increased funding to European defence companies. However, the ultimate purpose of these proposals should be a strong defence capability of Europe. The role of and the coordination with NATO must also be undertaken accordingly.
The revision of the Directive must consider that the European defence industry base is dependent on cooperation and collaboration with partners from non-EU states, perhaps particularly so the Swedish defence industry. A procurement procedure which does not take this fact into consideration, will exclude large parts of the Swedish defence industry and thereby the European defence industry base. We also recall paragraph 28 of the Conclusions of the European Council of 23 October 2025 stressing the importance of working with like-minded partners who share the EU’s foreign and security policy goals.
SOFF does not support suggestions that may impose restrictions on Swedish and European defence capabilities. We recognise that as of today many Swedish companies offer and develop solutions – that are crucial for Swedish and European defence capabilities – in collaboration with non-EU countries. We believe that this must be considered in any discussion on requirements for European preference. We believe that the goal should always be to strengthen Europe’s defence capability. Therefore, we also stress the importance of proceeding with European rather than

EU preference.
Prioritising bids that include a minimum share of EU-based production
The effect of this proposal depends fully on the definition of ”minimum share of EU-based production”. EU-based production must refer to the value creation of the end product or service, and not the origin of each single component throughout the supply chain. The main reason for this is to ensure that the proposal does not result in an unintended effect by imposing self-harming restrictions on European defence capabilities.
It is essential that the armed forces of the Member States have access to the best possible equipment. We observe that several components, products, and services that are critical to Europe’s defence are currently produced—partly or entirely—at a higher quality outside the EU than can presently be achieved within its borders. In the short term, a risk of the suggested proposal is therefore that Member States are limited to procuring inferior products or services at a higher price. It also risks imposing relatively heavy administrative burdens on smaller suppliers. In the long term, however, the suggested proposal can result in a stronger European industrial base and a more secure Europe.

In the short term, it is essential to identify the dependencies that pose the greatest risk to our freedom of action. These represent the most problematic and vulnerable dependencies and should therefore be prioritised for immediate attention.
SOFF stresses the importance of ensuring that EU preference should also include other European countries than EU member states. If a European preference is incorporated into the Directive, it should be based on design authority. Companies should subsequently retain the freedom to determine the most effective solution — including SoS, SoI, and subcontractors within or beyond the EU — to meet Member State demands.
If the preference is formulated either as a mandatory requirement (minimum requirement) or as a recommended requirement (evaluation criteria), the definitions need to be clear and verifiable, and the level of requirements must be proportionate to the criticality and security classification. A level-based, risk-based model is more realistic than fixed general requirements.
In general, it is important that any new reporting or transparency requirements are designed in a risk-based and proportionate manner so that they do not create unnecessary administrative burdens or unintended security risks, especially for smaller operators.
Granting additional points or weighting for EU supply-chain participation in award criteria
In general, we support the proposal. However, we recognise that as of today supply-chains are, at least to some extent, dependent on global subcontractors. Therefore, we recommend that it is clearly defined if and how the point system relate to different tier levels.
Applying EU preference only in specific strategic capability areas
We welcome some kind of delimitation on the applicability of EU/European preference. However, some risks/challenges should be mentioned. A potential risk with this approach is that the strategic capability areas are too few to be able to develop and sustain a competitive defence industrial base. Another is the potential difficulty to interpret or define what constitutes a “specific strategic capability area” in the EU.
Introducing a post-award transparency obligation requiring contract authorities to justify the selection of non-EU suppliers
This would result in an administrative burden for companies, while not providing any clear benefits that outweigh the negative consequences. In addition, the proposed requirement on transparency does not align with the sensitive nature of defence procurement. We acknowledge that aggregation of non-sensitive information can become sensitive information, which can be used against the EU by adversaries.

Incentivising procurement within the EU by allowing targeted exceptions from or flexibilities to normal procurement rules
We support the introduction of exceptions when motivated by i.e. geopolitical and security reasons. However, we do not support the introduction of consistent and extensive use of exceptions as this may prevent competition.