European Parliament, Europe's military capabilities remain weak. Part of the blame for this state of affairs, argues the Internal Market Committee in a new report, lies with the Member States' policies in the area of defence procurement.
Responding to a Commission Green Paper, the committee urges the EU executive to draft a new directive on defence procurement and calls for the European Union to push for further overall harmonisation and standardisation in the field.
EU countries are allowed, under Article 296 of the EC Treaty, to derogate from Community rules on public procurement on grounds of national security in the area of arms production. According to MEPs, this loophole is being systematically abused by Member States' armaments agencies, leading to a situation whereby most defence contracts are awarded on the basis of national rules.
This, in turn, is aggravating the fragmentation of armaments markets, limiting interoperability between military systems and hampering European cooperation in international operations. The Commission, MEPs agreed, should try to end such general derogations by adopting both an Interpretative Communication on Article 296 and a new directive on defence procurement.
Members echoed the Commission's view that current policies of “juste retour” (ensuring that Member States get their “fair share” of contracts) and the “off-setting” of arms purchasers' costs through supplementary investment deals in the field of military procurement hinder efficiency and “lead to large-scale distortions of competition and artificial divisions of labour between industrial partners”.
The inevitable concentration of the armaments industry, the committee concluded, should be subject to greater monitoring and control by the Commission with regard to competition law.
To ensure more competition, as well as greater transparency and fairness in the awarding of contracts, MEPs called on the European Defence Agency to devise an Article 296 code of conduct for defence procurement. They also urged the Commission to tackle a host of other obstacles to enhanced competition within the arms industry, such as the restrictions on cross-border trade in armaments within the EU, the exertion of political influence on award decisions and the lack of research cooperation.
The own-initiative report, authored by Joachim Wuermeling (EPP-ED, DE), commanded an overwhelming majority of 36 committee members against a single “no” vote, with one member abstaining. The text will be put to the vote in plenary during Parliament's November session in Strasbourg.
