The European Commission and the Council of the EU have welcomed an agreement on the creation of the Security Action for Europe (SAFE) instrument - an unprecedented financial tool to support Member States’ investments in defence capabilities, as proposed under the ReArm Europe Plan / Readiness 2030.

With the SAFE instrument, the Commission will raise up to €150 billion on capital markets, offering long-term, competitively priced loans to Member States for scaling up investments in key defence areas such as air and missile defence, drones, strategic enablers, and other critical technologies.

Ursula von der Leyen, President of the European Commission, said: “Exceptional times require exceptional measures. I welcome today's agreement on SAFE, our Defence Industrial Readiness Loan instrument, as a critical step forward. Europe must now assume a greater share of responsibility for its own security and defence. With SAFE, we are not only investing in cutting-edge capabilities for our Union, for Ukraine, and for the entire continent; we are also strengthening the European defence technological and industrial base. This is about readiness. This is about resilience. And it is about creating a truly European market for defence. Europe is stepping up — with purpose, with unity, and with a clear roadmap toward Readiness 2030.”

The loans will be disbursed upon request and based on national plans submitted by Member States, who are encouraged to engage in joint procurements to ensure interoperability, economies of scale and reduced fragmentation within the EU defence market. In response to the current geopolitical situation and urgent need for massive investment in defence equipment, however, SAFE will also allow procurement involving only one member state for a limited period of time.

SAFE opens up a new chapter in the cooperation with third countries. Ukraine and EEA-EFTA countries will be treated on the same terms as member states, enabling them to participate in joint procurements and allowing procurement from their defence industries. SAFE will also allow acceding countries, candidate countries, potential candidates and countries that have signed a Security and Defence Partnerships with the EU, such as the United Kingdom, to join common procurements. 

SAFE will finance projects in two categories of defence products, as identified by the European Council in March 2025:

1) ammunition and missiles; artillery systems, including deep precision strike capabilities; ground combat capabilities and their support systems, including soldier equipment and infantry weapons; critical infrastructure protection; cyber; military mobility including counter-mobility;

2) air and missile defence systems; maritime surface and underwater capabilities; drones and anti-drone systems; strategic enablers, such as, but not limited to, strategic airlift, air-to-air refuelling and C4ISTAR systems as well as space assets and services; space assets protection; artificial intelligence and electronic warfare.

For both categories of the products, procurement contracts will have to ensure that the cost of the components originating outside the EU, EEA-EFTA states and Ukraine is not higher than 35% of the estimated cost of the components of the end-product. Contractors for category 2 products must also have the ability to define, adapt, and evolve the design of the defence products, safeguarding EU autonomy and technological leadership.

SAFE entered into force on 29 May 2025, the day after its publication in the Official Journal of the EU. From that date, Member States will have six months to submit their initial national investment plans, which will be assessed by the Commission. The Council will then adopt implementing decisions specifying loan amounts and any pre-financing.

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