More Competition Seen in European Defense Procurement

 - January 16, 2009, 8:58 AM

A new measure to open up defense procurement by European countries to greater competition will become law within the next 18 months. The European Parliament approved the European Directive on Defence and Security Procurement on January 14. This should greatly increase the percentage of defense contract opportunities that EU governments offer to bidders from other European countries. The new law also allows manufacturers to apply for a general license to export specific defense equipment within the EU, rather than seek permission for each sale. Previously, the EU encouraged member states to publish contract opportunities on the Web site of the European Defence Agency (EDA). Still, less than one-fifth of European defense procurement by value is estimated to have been so notified. “European industries will get a much larger ‘home’ market with longer production runs and economies of scale,” promised Charlie McCreevey, the EU internal market commissioner.