EU Governments Ask EDA for Armaments Strategy, More Defence Collaboration

European Defence Agency, BRUSSELS: EU governments today asked the European Defence Agency to produce an Armaments Strategy to help meet future military needs, ensure interoperability and standardization, and share the ever-increasing costs of developing and procuring high-technology defence equipment. 
 
A two-day meeting of the EDA Steering Board also agreed a number of specific measures to intensify defence collaboration, including work on key technologies and industrial capabilities to be retained or developed in Europe, rules to help greater sharing of testing facilities, actions to encourage more cross-border bids for defence equipment contracts, and further investments in the Agency’s work on Unmanned Air Vehicles (UAVs). 
 
“The Agency and its shareholders have done a great job so far in developing strategies and policies, and significant progress is visible in R&T and the defence market,” said Eero Lavonen, who chaired the meeting’s second day with National Armaments Directors. “It is high time to boost armaments cooperation under EDA’s auspices. We have a tool at our disposal and we must use it fully.” 
 
Jan-Olof Lind, who chaired meeting of R&T Directors on the first day, was satisfied that good progress has been made in implementing the Framework for a Joint European Strategy in Defence R&T, adopted by the Steering Board last November. He also stressed the need for the Agency’s 26 participating Member States (all EU members except Denmark) to share information on specific initiatives they were planning or developing. 
 
“This can only enhance transparency and increase potential for cooperation – which is part of the Agency’s overall objective. It is time to see new and more significant cooperative projects and programmes under the Agency,” he said. 
 
The Armaments Strategy, which will focus in particular on how to convert agreed defence capability needs into collaborative programmes, will be presented in November to a ministerial meeting of the Steering Board, the Agency’s highest decision-making body on which governments and the European Commission are represented. 
 
Among the other steps agreed during the meeting were rules and procedures for governments to share test and evaluation facilities for military equipment, which have traditionally been developed and operated on a purely national basis. Lavonen welcomed the fact that France had last week announced plans for a test programme for integrated equipment on aircraft and encouraged other governments to share information about future testing projects. 
 
The meeting heard a report on the first full year of operation of the Code of Conduct to encourage cross-border defence procurement and the associated online portals (see Appendix 1 for highlights). The Steering Board said the overall implementation had been positive, with subscribing Member States adapting their practices to conform with the Code. The Code had brought real change to the way procurement happens. 
 
The volume of government contract opportunities posted on the EDA’s Electronic Bulletin Board (EBB) had steadily grown, with 18 of the 24 subscribing governments publishing more than 260 contract opportunities. In 2007, 60 contracts worth EUR 616 million were already awarded as a result of competition and 16 of them were cross-border, although there was still only limited cross-border bidding by industry. The largest opportunity published had an estimated value of EUR 1 billion. 
 
The report said the parallel Code of Best Practice to encourage greater competition in the supply chain and the online portal were now recognized by a number of the most active companies as beneficial tools allowing them to easily reach out to potential new suppliers in Europe. 
 
Together with the Aerospace and Defence Industries Association of Europe (ASD), whose President Åke Svensson addressed the Steering Board meeting, the Agency plans a series of initiatives and marketing actions to increase awareness of the EBB to more defence-related companies in Europe to develop a critical mass of users. 
 
Svensson told the Steering Board that industry fully supported the defence procurement regime, but to make the initiative reach its full potential required continued effective leadership starting at the highest levels in governments and industry. 
 
“From an industry perspective we also need more common requirements that lead to more common development and procurement, especially of complex and advanced systems,” he said. 
 
On the subject of UAVs, the Steering Board noted with satisfaction the work already done by the Agency for a Road Map to integrate the unmanned craft into conventional airspace and asked it to come up with further proposals in four areas: integration and coordination; standardisation and harmonisation; R&T projects into high-priority technology areas where immediate investment is needed; and initial areas for demonstration and validation. 
 
In response to a proposal by the United Kingdom about the general issues raised by the need for every country to certify the airworthiness of new military UAVs, the Agency was tasked to start investigating the idea of an EU-wide forum on military Airworthiness to save time and money. 
 
The meeting also heard a presentation on the MIDCAS project involving Sweden and France on collision-avoidance systems for UAVs and encouraged other Member States to share relevant R&T initiatives in this way. 
 
“I am delighted to see Member States bringing suggestions for collaboration to the Steering Board,” said EDA Chief Executive Alexander Weis. “The Agency wants to see many more joint projects but we need inputs and support from governments so we can make a difference,” he added. 
 
Main Points Of EDA Report Into Workings Of Regime On Defence Procurement 
 
The assessment of the overall implementation of the Code of Conduct is positive and, in general, subscribing Member States (sMS) have adapted their procurement practices to the CoC’s provisions; 
 
– The volume of Government contract opportunities posted on the European Bulletin Board 1 (EBB1) has steadily grown. By 1 April 2008, 18 of the 24 sMS had published more than 260 contract opportunities; 
 
– During 2007, sMS published on EBB1 60 Contract Award Notices (CAN) with competition for a total value of EUR 616M (excl. VAT), 16 being cross-border contracts and 32 awarded to SMEs. It should be taken into consideration that there is still limited cross-border bidding by industry; 
 
– The EDA has been informed for 2007 of 112 government contracts falling under the exceptions to the CoC, mostly for “supplementary goods and services” and “follow-on work”, which seems to be a reasonable and relatively restrictive use of the follow-on exceptions; 
 
– The EDA continue to work on a number of aspects which still affect fair competition across borders (e.g. Security of Supply); 
 
– The EBB2 (for sub-contracting opportunities) enjoys support by industry, where it is considered as being an important step in the right direction from both buyers and suppliers towards changing behaviours in the supply chain; 
 
– During EBB2’s first year of operation, it has started to be recognized by a number of the most active companies as a beneficial tool that was missing until now, allowing them to easily reach out to potential new suppliers in Europe and increase the efficiency of their supply chains; and 
 
– The Agency has launched a number of initiatives and marketing actions across the 24 sMS aimed at increasing awareness of EBB to the broader European defence-related industrial base (E-newsletter, Local Partners network, Call Centre). The objective is to increase usage, which is still limited, and reach the critical mass needed to deliver added value to both buyers and suppliers.