EU defence innovation: deal with Council on new AGILE programme 

This article is brought to you in association with the European Parliament.

The draft law aims to respond to the new security environment shaped by Russia’s war of aggression against Ukraine, where fast and low-cost defence innovation cycles are critical.

On Wednesday, MEPs and the Irish Presidency of the Council reached a provisional political agreement on the creation of a programme for agile and rapid defence innovation (AGILE), a new €115 million instrument designed to provide rapid, agile and targeted financial support to small and medium-sized enterprises (SMEs) – including start-ups and scale-ups – developing emerging and disruptive defence technologies. Today’s agreement ensures EU support for SMEs across the EU to be at the centre of defence innovation.

The programme is designed to stimulate innovation with fast-track grants and access to testing and certification. It provides a way for member states to be involved in setting challenges to ensure the products developed met their capability needs. It simplifies procurement of products supported by AGILE.

AGILE seeks to accelerate defence innovation among SMEs across the EU and demonstrate that SMEs and start-ups can provide the technological solutions to Europe’s capability needs and play a role in reducing Europe’s strategic dependencies. This will help make the case for increased support to be directed towards SME innovation in the next Multiannual Financial Framework (MFF).

The co-legislators worked constructively and pragmatically together to ensure that this pioneering programme can be implemented and operational within months.

Main elements of the agreement

– Focus on SMEs and disruptive innovation: the deal confirms the programme’s focus on SMEs, start-ups and scale-ups working on emerging and disruptive defence products, including the adaptation of civil technologies for defence applications, to help bridge the gap between development and deployment.

– Speed and scope: the agreement maintains the fast-track, four-month time-to-grant envisaged by the Commission, reinforcing AGILE’s role as a nimble complement to the EU’s existing defence industrial toolbox.

– Connection with defence industrial “primes”: the new programme will facilitate the connection between SMEs and so-called defence industrial “primes”, the major defence industry companies that dominate the sector, including through dedicated matchmaking to increase uptake of AGILE supported products.

– Access to testing: the deal confirms fast-track access to testing and experimentation facilities to address a key barrier for SMEs in bringing products to market.

Quotes

“With a swift agreement on AGILE, we are accelerating the path from innovation to deployment while strengthening our SMEs, ensuring support for Ukraine, reinforcing safeguards against strategic dependencies, enhancing security of supply, and providing robust oversight to help shape future EU defence initiatives” lead MEP for the Security and Defence Committee (SEDE) Tonino Picula (S&D, Croatia) said.

“Europe cannot afford to be slow when the threat is quick. AGILE is our answer: funding out quickly, bureaucracy stripped away, and the door firmly shut to those who do not share our values. Innovation is Europe’s strength. Let us finally use it.” lead MEP for the Industry, Research and Energy Committee (ITRE) Ivars Ijabs (Renew, Latvia) said.

“With AGILE, we are creating the conditions for new defence technologies to be developed, tested and deployed more quickly, so that innovation reaches Europe’s armed forces faster. The agreement reached today is a strong signal that Europe can act with speed and determination when it comes to strengthening its security. Just four months after the Commission presented its proposal, Parliament, Council and Commission have delivered a political agreement through swift, constructive and highly productive cooperation.” SEDE chair Marie-Agnes Strack-Zimmermann (Renew, Germany) said.

ITRE Chair Borys Budka (EPP, Poland) said: “As Ukraine is relying on European support, our SMEs need targeted programs to accelerate transition from prototype to operational capability. AGILE is built to close that gap. The Russian aggression has rewritten the rules of engagement: the side that innovates faster, wins. Europe cannot afford to let its most promising defence innovators be slowed down by bureaucracy. Our job now is to prove this model works in practice, so it can serve as the blueprint for the upcoming European Competitiveness Fund and the next generation of defence programmes. Europe’s security depends on backing innovators who can turn promises into reality the fastest.”

Next steps

The provisional agreement must now be formally endorsed by Parliament and Council. Once adopted, the regulation will enter into force 20 days after its publication in the EU Official Journal. The new programme is on track to become operational from early 2027.

Background

While the EU has already developed a substantial defence innovation framework, mostly aiming at long-term and large-scale projects, AGILE aims to address the fact that emerging and disruptive technologies (including AI, quantum computing, robotics, cyber capabilities, and space systems) are increasingly decisive for military effectiveness.

The AGILE programme will support the rapid innovation capacity of SMEs, including innovative startups and scaleups, in delivering emerging and disruptive defence products and technologies that address the most urgent challenges faced by member state armed forces, with a focus on cost-efficiency and reducing strategic dependencies on non-associated third countries.