Military procurement and national security

Research project: Towards coherent, just and effective EU legal frameworks for military procurement. Questioning the legal basis, principles and presuppositions underlying the EU’s Defence Procurement Directive.

Limited effectiveness of EU military procurement directive

To gradually establish a European market for military equipment, the EU legislature adopted the Defence Procurement Directive (Directive 2009/81/EC) over ten years ago. From that moment onwards, public contracts in the field of defence and security have been subject to EU public procurement obligations. According to the EU’s Member States and the European Parliament a competitive (and integrated) defence European market is important, both for ensuring the security and sovereignty of the Member States,  and for ensuring  the ‘strategic autonomy’ of the Union in its external relations.

The first constitutional basis for a common defence policy was added to the EU-Treaties in 1992 with the Maastricht Treaty. In contrast to the supranational legal basis of the internal market, the legal base for the common defence policy is intergovernmental. This difference was again confirmed in 2007 in the Lisbon Treaty, proclaiming that national security remains the ‘exclusive responsibility’ of each individual Member State (Art. 4, para. 2, Treaty on European Union – EU-Treaty) and that the ‘progressive framing of a common Union defence policy’ is only possible when the European Council decides so unanimously (Art. 42, para. 2, EU-Treaty). The intergovernmental nature of the common defence policy is also visible in the legal structures of the European Defence Agency (EDA), which was established in 2004. At the same time, the Member States have increased the possibilities for intergovernmental cooperation with the Lisbon Treaty (for instance through the adoption of PESCO).

Against the background of careful intergovernmental steps towards more EU military cooperation, the EU introduced in 2009 public procurement obligations for military goods, services and works with the Defence Procurement Directive. Until the adoption of the directive, military public contracts were excluded from the application of the EU- internal market and competition regulation based on Art. 346 TFEU (Treaty on the Functioning of the EU). This provision ensures that the EU-Treaties do not preclude Member States from taking ‘such measures as it considers necessary or the protection of the essential interests of its security which are connected with the production of or trade in arms, munitions and war material’. Hence, the EU pursued the realisation of common defence policy through an internal market measure. However, so far this attempt has been largely unsuccessful. The most recent assessment of the Commission (European Commission) shows that in 2015 from the roughly 80 billion which countries spent on military goods only for 19,3 billion the EU Defence Procurement Directive has been applied (+- 24%).  Leaving out the procurement of the UK, this would be around 6.3 billion out of roughly 50 billion (+- 12,5 %). The numbers show that for more than 75% of its total value, military procurement was not fully opened for competition.

Limited effectiveness because of legal frameworks?

In this context, a plethora of questions arise about international-, European- and national laws – written and unwritten – which should bring balance to the international relations between states when it comes to public procurement of military goods, services and works. This is crucial for the maintenance of peace in a changing geopolitical climate. Next to these effectiveness issues, questions arise about the legality of the directive in relation to the EU-Treaties and the correct application thereof. On top of that, there is the more intriguing question of how to simultaneously increase the EU’s strategic autonomy in its external relations and ensure the national security of the Member States which lays at the basis of European security.

Most of these fundamental questions touch upon the division of competences between the EU and its Member States, which could only be adjusted by Treaty-revision.

PhD projects

The above and other related questions and issues led to the setting up by prof. dr. Elisabetta Manunza LLM of the following PhD projects.

Research method in this project

Although the research projects have different methodological frameworks, they share the following approach.

Finding new solutions requires identification and analysis of the real problem ‘behind’ the legal issues. This is necessary to reveal the true nature of the problem, because not all societal problems can be solved by rules, nor are the rules always to blame for the problem. Basing the research on such an understanding of the problem increases the effectiveness of the solutions that will be provided to tackle it. After this empirical observation, the historical origins of the regulation at stake are evaluated to better understand which aims lay at its basis and how these aims have evolved. For that purpose, it is crucial to distinguish between the aims and the ‘challenge’ of the regulation.

By firstly addressing the problem and the historic origins of the regulation, research contributes to correctly answering the question whether – and if so, to what extent – the national, European and international aims diverge (i); are in tension with one another (ii;) or are in conflict with each other (iii). For this analysis, the Treaty-frameworks of EU-law, the aims of the EU-Treaty and the jurisprudence of the EU Court of Justice are guiding.

The latter is important for the subsequent analysis of the more specific questions of the three different research projects and to evaluate whether the solutions that will finally be provided, concur with the aims of the EU and its Member States, as well as with international military organisations such as the NATO.

After the general analysis, the specific questions can be addressed. These questions will be answered by evaluating the legal obligations deriving from the EU-internal market regulation (as well as from other areas of EU-law) in light of relevant sources of public international law, such as the NATO-Treaty, and national law aiming at ensuring national security. The jurisprudence of the EU Court of Justice will be extensively scrutinised here to identify the way in which the Court balances the interests of the Member States with the interests and rights of economic operators and those of the EU internal market. For this purpose, a distinction will be made between:

  • legal provisions which concern the establishment of the internal market; analysed in light of the more fundamental legal principles in the internal market domain such as the principles of proportionality, of non-discrimination, of equal treatment and of transparency. The principle of coherence will be applied for this evaluation as well;
  • legal provisions which concern the foundations of the constitutional relations between the EU and its Member States and the sovereignty of the latter. These provisions are interpreted according to the theory of the ‘living constitution’, which enables us to understand and to interpret the EU-Treaties in the context of the social forces which created them and which are maintained by the EU-Treaties themselves. On top of this, the systematic, functional and teleological interpretation methods will be used that are decisive in the interpretation of EU-law by the EU Court of Justice. This is of fundamental importance, as the internal market rules should be understood and explained against the background of the EU-Treaties as a whole and the aims, means and tasks of the EU as set out in Art. 3, EU-Treaty.