What changed between the plenary report and the adopted text

Removed:DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

Added:P10_TA(2025)0320

Changed:on the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) 2021/694, (EU) 2021/695, (EU) 2021/697, (EU) 2021/1153, (EU) 2023/1525 and 2024/795, as regards incentivisingIncentivising defence-related investments in the EU budget to implement the ReArm Europe Plan

Removed:(COM(2025)0188 – C100070/2025 – 2025/0103(COD))

Added:Committee on Industry, Research and Energy

Added:PE774.253

Added:European Parliament legislative resolution of 16 December 2025 on the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) 2021/694, (EU) 2021/695, (EU) 2021/697, (EU) 2021/1153, (EU) 2023/1525 and 2024/795, as regards incentivising defence-related investments in the EU budget to implement the ReArm Europe Plan (COM(2025)0188 – C10-0070/2025 – 2025/0103(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2025)0188),

Changed:– having regard to Article 294(2) and Articles 114, 164, 172,172 and 173, Article 175, third paragraph, Articles 176, 177 and177, 178, 182, 183,183 188,and 188 and Article 192(1) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C10-0070/2025),

Changed:– having regard to Articlethe 294(3)opinion of the TreatyCommittee on theLegal FunctioningAffairs ofon the Europeanproposed Union,legal basis,

Added:– having regard to Article 294(3) and Articles 164 and 172, Article 173(3), Article 175, third paragraph, Articles 177 and 178, Article 182(1) and (4), Article 183, Article 188, second paragraph, and Article 192(1) of the Treaty on the Functioning of the European Union,

– having regard to the budgetary assessment by the Committee on Budgets,

– having regard to the opinion of the European Economic and Social Committee of 18 September 2025,

Change 1

Removed:– after consulting the Committee of the Regions,

Added:– having regard to the opinion of the Committee of the Regions of 15 October 2025,

Removed:– having regard to Rules 60 and 58 of its Rules of Procedure,

Added:– having regard to the provisional agreement approved by the responsible committee under Rule 75(4) of its Rules of Procedure and the undertaking given by the Council representative by letter of 10 November 2025 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

Added:– having regard to Rules 60, 41 and 58 of its Rules of Procedure,

5 unchanged paragraphs

– having regard to the opinions of the Committee on Security and Defence and the Committee on Transport and Tourism,

– having regard to the report of the Committee on Industry, Research and Energy (A10-0172/2025),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Change 2

Removed:AMENDMENTS BY THE EUROPEAN PARLIAMENT*

Added:P10_TC1-COD(2025)0103

Removed:to the Commission proposal

Added:Position of the European Parliament adopted at first reading on 16 December 2025 with a view to the adoption of Regulation (EU) 2025/… of the European Parliament and of the Council amending Regulations (EU) 2021/694, (EU) 2021/695, (EU) 2021/697, (EU) 2021/1153 and (EU) 2024/795, as regards incentivising defence-related investment in the EU budget to implement the ReArm Europe Plan

Removed:---------------------------------------------------------

Added:(As an agreement was reached between Parliament and Council, Parliament's position corresponds to the final legislative act, Regulation (EU) 2025/2653.)

Removed:Proposal for a

Removed:REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

Removed:amending Regulations (EU) 2021/694, (EU) 2021/695, (EU) 2021/697, (EU) 2021/1153, (EU) 2023/1525 and 2024/795, as regards incentivising defence-related investments in the EU budget to implement the ReArm Europe Plan

Removed:(Text with EEA relevance)

Removed:THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Removed:Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 114, 164, 172, 173, Article 175, third paragraph, Articles 176, 177 and 178,182 183, 188, 192(1) thereof,

Removed:Having regard to the proposal from the European Commission,

Removed:After transmission of the draft legislative act to the national parliaments,

Removed:Having regard to the opinion of the European Economic and Social Committee,

Removed:Having regard to the opinion of the Committee of the Regions,

Removed:Acting in accordance with the ordinary legislative procedure,

Removed:Whereas:

Removed:(1) The unprecedented geopolitical instability and the rapid deterioration of regional and global threat levels, in particular Russia’s war of aggression against Ukraine launched in 2014, its continued aggressive rhetoric toward the Union, and the threat of its conventional military attack against the Union’s Eastern Flank, as well as the instability in the Middle East and in the Southern Neighbourhood require an urgent and significant step up of the Union spending on research and development, industrial capacity and development of infrastructures connected with resilience, security and defence. As identified in the Joint White Paper for European Defence Readiness 2030, the Union should do more to support the urgent need to increase European defence-related investments with the Union budget.

Removed:(1a) In addition, Member States are to increase their defence spending to strengthen the Union’s deterrence and defence posture not only by modernising armed forces and replenishing military stockpiles, but also by investing in critical infrastructure, joint capabilities, and defence technological innovation. Sustained and increased defence expenditure is indispensable for the safeguarding of European sovereignty, upholding collective security commitments within the North Atlantic Treaty Organization (NATO), and ensuring the Union's capacity to respond swiftly and decisively to the full spectrum of military and hybrid threats.

Removed:(1b) As was stated in the reports of Enrico Letta, Mario Draghi and Sauli Niinistö, the lack of an internal market for defence is hindering the ramp-up of much-needed industrial production and innovation regarding military and dual-use products. In order to reduce unnecessary fragmentation, to strengthen the European Defence Technological and Industrial Base (EDTIB), and to enhance European strategic autonomy and readiness the Union should further stimulate the Union-level cooperation of their defence industry and the development of joint projects. The industry would benefit from an inclusive approach within the internal market and its accelerators for research, development and innovation. The leveraging of Union funding programmes to support defence-related technologies and products is therefore intended not only to serve as a stepping-stone towards a genuine Defence Union, but also to enhance civil-military cooperation across Member States in light of mutually beneficial spill-overs.

Removed:(1c) Given the Union’s intention to open existing programmes to provide more support to defence-related investments with the Union budget, the funded projects should be aligned with the Union's strategic security interests and take into account the European security architecture. This encompasses an alignment with the priorities set out by the Joint White Paper for European Defence Readiness 2030 and with the collective commitments within NATO, which remains a cornerstone of Europe’s collective defence. In light of the persistent Russian threat, Russia’s full-scale aggression against Ukraine, and the intensifying use of hybrid, cyber and subversive tactics against the Union, the latter must strengthen practical cooperation with NATO, NATO members, and trusted, like-minded partners, particularly in defence research, capability development, and military mobility. Closer coordination between the Union and NATO not only avoids duplication and enhances interoperability but also reinforces a united transatlantic response to common security challenges.

Removed:(1d) Investing in the development of cutting-edge dual-use capabilities should be promoted as it contributes to the Union’s broader societal resilience, security and competitiveness objectives. While noting the necessity of ensuring equitable geographic distribution of defence-related investments for Union-wide cohesion and resilience, specific consideration should be given to the Union's external border regions due to their unique security challenges, such as Europe’s Eastern flank bordering Russia, Belarus, and Ukraine. These areas are at the frontline of potential conflicts and are vulnerable to external threats, making it crucial to enhance local defence capabilities and foster resilience within communities.

Removed:(1e) Given that Ukraine’s sovereignty, resilience, and industrial capacity are essential to European security, efforts should be undertaken to explore pathways for the future integration of Ukraine’s defence industry into relevant Union programmes, and to support its efforts to modernise, innovate, and align with European standards. Such cooperation would contribute to strengthening Ukraine’s resilience and the Union’s broader security and industrial objectives.

Removed:(1f) Recognising the strategic importance of fostering efficiency, reducing unnecessary duplications and fragmentation of the Union’s defence industry, the Commission should, where appropriate, prioritise projects that promote cross-border cooperation, facilitate technology transfers between different Member States, the establishment of interchangeable or common frameworks, or further advance the integration of the defence industry, including by demonstrating Member States commitments to jointly own, use, and manage final products in a coordinated manner.

Removed:(2) The Strategic Technologies for Europe Platform (STEP) established by Regulation (EU) 2024/795 of the European Parliament and of the Council is an initiative aimed at boosting Union competitiveness by mobilizing funds from 11 existing Union programmes towards critical technologies in 3 strategic sectors: digital technologies and deep tech innovation, clean and resource-efficient technologies, and biotechnologies. As such, it is a good vehicle to mobilise, in a coordinated and synergetic manner and by enhancing civil-military cooperation, Union resources towards defence and security technologies, including key digital frontier technologies required for the development of defence products and technologies.

Removed:(3) While support to technologies having defence implications is possible today under the 3 existing strategic sectors identified in STEP, it appears necessary to increase the potentialities of development of research, industry and innovation in the defence and security area by setting out a fourth strategic sector in STEP focussed on defence and security technologies, without compromising Union’s intended technological leadership in the existing sectors. The added fourth strategic sector should include those enhancing societal resilience, understood as ability to withstand, adapt to, and recover from natural and human-caused disruptions, shocks and stresses - while maintaining core functions, structures, and values, including trust and participation of citizens in democracy and democratic institutions and strengthening integrity of elections and checks and balances. This new strategic sector should ensure that the STEP incentives are used to increase Union funding in innovative defence security technologies with the aim to respond effectively to current and emerging threats and enhance the Union’s strategic autonomy and contribute to European competitiveness in line with STEP objectives. Defence technologies should be understood as those referred to in the Annex to Directive 2009/43/EC and include, in particular, technologies in the areas identified by the European Council on March 6th 2025, namely: air and missile defence, artillery systems, including deep precision strike capabilities, missiles and ammunition, drones and anti-drone systems, strategic enablers, including in relation to space and critical infrastructure protection, military mobility, cyber, artificial intelligence and electronic warfare. Security technologies should be understood, but not limited to, technologies intended to support the prevention of, detection of, protection against, response to, and recovery from, security threats, such as terrorism, hybrid threats, critical infrastructure protection, cybersecurity and disaster-resilient societies. The development of such technologies is essential to enhancing the Union’s internal security, safeguarding its strategic interests, and ensuring the resilience of Member States’ societies and economies against destabilisation attempts. The Commission should issue guidance on the interpretation and understanding of defence and security technologies, including those enhancing societal resilience, to ensure consistent application of relevant legal provisions. As regards artificial intelligence, AI Gigafactories should become key infrastructures to expand rapidly the power of AI in defence technologies.

Removed:(4) In addition, in order to optimise the capacity of the programmes covered by STEP to mobilize Union’s resources towards defence’s needs, it is necessary to clarify that these programmes can pursue objectives and activities that are related to improving the competitiveness and resilience of the European Defence Technological and Industrial basis (EDTIB) as well as research and development activities in the defence field.

Removed:(5) Horizon Europe established by Regulation (EU) 2021/695 of the European Parliament and of the Council is the Union’s key funding programme for research and innovation, playing a pivotal role for global scientific and technological leadership of the Union. The European Innovation Council (EIC) Accelerator established by that Regulation provides support, in particular, for innovations with breakthrough potential and of a disruptive nature with scale-up potential that may be too risky for private investors. SMEs, start-ups and some small mid-cap enterprises operating within the defence sector require financing for the commercialization of innovative products. However, these companies face higher barriers to access finance compared to entities in other sectors. Whereas the support to defence research and development is done through the European Defence Fund (EDF), which is a specific programme of Horizon Europe, it is appropriate to open the EIC Accelerator to support breakthrough and disruptive innovation for civil applications with potential dual-use, provided that such applications are primarily designed for civil use. Support to scale-up under the EIC Accelerator should also be extended to non-bankable SMEs, including start-ups and non-bankable small mid-caps, including entities which have already received support from the Accelerator carrying out breakthrough and disruptive non-bankable innovation, including defence and security technologies, referred to in Article 2(1)(a)(iv) [of the STEP Regulation], provided they demonstrate dual-use potential. This justifies a targeted exception to the principle set out in Article 7(1) of Regulation (EU) 2021/695 of the European Parliament and of the Council according to which research and innovation activities under Horizon Europe have an exclusive focus on civil applications while not undermining the objective of ensuring unnecessary duplications. The Commission should ensure proper oversight of the application of the targeted exception, including through the collection and reporting of appropriate data, without creating additional administrative burdens for applicants and beneficiaries.

Removed:(6) Moreover, to ensure that appropriate resources are directed to the funding of dual-use and defence applications under Horizon Europe it is appropriate to derogate to Article 212(3) of the Financial Regulation in order to ensure that repayments, including reimbursed advances, revenues and unused amounts net of fees and costs of EIC blended finance investment component of the EIC pilot under Horizon 2020 are not directed to the Union budget but reinvested in the EIC Fund in order to finance additional ▌dual-use and defence applications benefitting from the amended scope . The timeframe set out in Article 212(3) of the Financial Regulation should also be adapted, by inserting a derogation, to allow for that possibility.

Removed:(7) The European Defence Fund (EDF) set out in Regulation (EU) 2021/697 of the European Parliament and of the Council, is the leading programme for enhancing the competitiveness, innovation, efficiency and technological autonomy of the Union’s defence industry. The EDF also aims at supporting actions that are conducive to developing disruptive technologies for defence. In order to better address the specificities of such actions, and in particular technologies demonstrating rapid deployment capability, such as their small scale or their need for a quick support, it is appropriate to significantly shorten and simplify the procedures to decide on the support of these actions while in the same time framing the conditions for the decision on such a support in the work programme and without undermining the principle of excellence.

Removed:(8) It is also necessary to exploit synergies between EDF and other Union programmes. To that purpose, it should be possible for Member States, European Union institutions, bodies and agencies, third countries, international financial institutions or other third parties to provide voluntary contributions to the Programme, as external assigned revenues. Voluntary transfers of resources allocated to Member States in shared management to the EDF and the combination of contributions from EDF with other Union programmes for specific actions should be possible, provided that the cumulative Union support does not exceed the total eligible costs of the action.

Removed:(9) The Digital Europe Programme (DEP) established by Regulation (EU) 2021/694 of the European Parliament and of the Council aims to support and accelerate the digital transformation of the European economy, industry and society and to improve the competitiveness of Europe in the global digital economy. In this context, the programme should also aim at supporting, in particular, projects, services and competences with potential dual-use application under all its specific objectives. This would contribute to strengthening Europe’s societal and democratic resilience in the face of ongoing hybrid attacks, foreign interference and emerging threats in the digital domain - an escalation that has intensified markedly since Russia’s invasion of Ukraine.

Removed:(10) To enhance technological sovereignty and competitiveness, the Union needs the computing, cloud and data infrastructures that AI leadership requires. As part of the AI Continent strategy, the AI factories and Gigafactories are essential for the Union to be able to compete on the global level and ensure its strategic autonomy and competitiveness in science, dual-use research and in critical industrial sectors, including the defence industry. Such next-generation models require extensive connected computing infrastructure for breakthroughs in specific domains including defence. It is therefore appropriate to add, in the Specific Objective 1 – High Performance Computing of DEP, a supplementary operational objective dedicated to the deployment and operation of AI Factories and new generation of IA Gigafactories specialised in developing, training, and running the most complex, very large, AI models and applications, including hardware and software necessary for such deployment. In line with the Union’s ambition towards strategic autonomy, technological leadership and improved competitiveness, and to mitigate the environmental footprint of digital technologies, it is important to ensure that the deployed digital infrastructure and technologies, including AI, aim to be resource-efficient and follow circularity principles.

Removed:(11) In the specific Objective 5 of DEP – Deployment and Best Use of Digital Capacity and interoperability, it is also necessary to add, in the operational objective defined to support the public sector and areas of public interest, a reference to defence in order to clarify that the financial contribution of the Union under such an Objective can be extended to that sector. Support for the public sector should be accompanied by measures that strengthen the capacity of Union-based companies to supply, develop, and innovate in the field of digital infrastructure services.