Security of Supply is a critical topic regarding both the European Defence Technological and Industrial Base (EDTIB) and the functioning of the European Defence Equipment Market (EDEM). EDA is taking a major step today, launching a new Portal on the Security of Supply (SoS). Peter Scaruppe, EDA’s Industry and Market Director, explains this new tool.
What is the importance of Security of Supply for the realisation of the European Defence Technological and Industrial Base (EDTIB) and the functioning of the European Defence Equipment Market (EDEM)?
Security of Supply is very important both for strengthening the EDTIB (the industrial side) and for the functioning of the EDEM (the market side). That’s why SoS remains at the core of our work.
One definition of SoS, developed by the Letter of Intent (LoI) community and widely used, is “a Nation’s ability to guarantee and to be guaranteed a supply of Defence Articles and Defence Services sufficient to discharge its commitments in accordance with its foreign and security policy requirements”. This of course means that SoS has an impact on many defence related issues and on many of EDA’s work strands. It is definitely not becoming less important in the current financial and economic situation as the need for “pooling and sharing” and the need for Member States to rely on each other increase.
Regarding the importance for the EDTIB, the EDTIB Strategy agreed by Defence Ministers in 2007 states that the concept of a truly European DTIB will not be realised in practice unless Member States are confident that increased mutual dependence for supply of defence goods and services is matched by increased mutual assurance of that supply.
In speaking terms, Security of Supply is all about “trust”. Defence procurement is often sensitive in one way or the other, and in order for Member States to rely on non-national sources of supply and to procure from the open EDEM, they need to be assured of the Security of Supply on that market.
In the end, Security of Supply is really a pre-requisite for effective and efficient industrial restructuring and for the confidence in open competition. It is a key, cross-cutting EDA work strand and it supports successful collaboration!
What are EDA’s achievements so far?
The first milestone was the “Framework Arrangement for Security of Supply between subscribing Member States in Circumstances of Operational Urgency”, which was endorsed by the EDA Steering Board in 2006. The Framework Arrangement is an integral part of the voluntary Intergovernmental Regime to encourage competition in the defence market. Subscribing Member States to the Regime have agreed to assist and expedite each other’s contracted defence requirements, particularly in circumstances of pressing operational urgency. They will also work to increase the level of mutual confidence. The Framework Arrangement is based on consultation processes and the principles of cooperation and solidarity.
Right now, one of our major tasks together with Member States is the further implementation of this Arrangement and we believe that the SoS Portal will contribute to this process, for example by simply making the necessary contact information more accessible.
What is the aim of this new Portal?
Well, the ultimate aim of the EDA work on Security of Supply is the achievement of equal confidence in Security of Supply from any part of Europe. This of course sounds very ambitious, but we base our work on a pragmatic step by step approach, reaching a common understanding on and taking into account the different aspects of Security of Supply.
The Portal will contribute to this work by increasing the transparency of Member States policies, procedures and priorities connected to the Security of Supply. And as already mentioned: by providing contact information it simplifies access to our Member States’ SoS systems and/or to further information.
What sort of information is available on this Portal?
The Portal contains information provided by our Member States on their legal basis for SoS, their SoS objectives, the national bodies involved and their areas of responsibilities, the role of SoS in their procurement processes, possible contractual terms on SoS that they use, existing bi- and multilateral agreements on SoS that they might have and contact information to relevant PoCs in their respective administrations.
We will also have information on the related EDA documents and links to other relevant sources of information on SoS. But of course, the Portal is a living tool!
Who is your target audience?
The Portal will be publically available on the Internet for everybody. It will probably be most useful to stakeholders such as Governments and Industry, but also for other institutions and academia.
And what sort of benefits will users get from this new platform?
We hope that finding this sort of information collected in one place will be of real benefit for our stakeholders. The Portal will be a place to collect information about Member States’ SoS policies, but also to identify Points of Contact to communicate with.
For example a company planning to place a bid in one of our Member State´s procurements could use the Portal to get an overview of the SoS policies, practices and requirements of that Member State. A Member State on the other hand could use the Portal to get an idea of the SoS policies in its fellow Member States, which could be useful when considering one’s own policies, when procuring on the open EDEM or when engaging in a collaborative project.
How did your team collect this information? Which lessons have you learned from this exercise?
Last year we conducted a stocktaking exercise with Member States, basically collecting the information that is now available on the Portal. One of the practical outcomes of the stocktaking was the decision by Member States to set up this Portal.
We have worked closely together with our SoS Experts community throughout the setting up of this Portal. This has proven to work very well and we would like to thank all our Member States for their support! It has been very helpful to have the experiences of the LoI and Nordic communities, who have been cooperating on SoS for a long time.
What are your expectations?
That the SoS Portal will be a hub for finding information on SoS and that it will be of real use for our stakeholders, others and also for ourselves. We also hope that it will contribute to the practical implementation of our Framework Arrangement, so that this Arrangement can be used for solving SoS issues in cases of operational urgency.
What is the way ahead for SoS?
We are working together with our SoS Experts community on various issues. As mentioned, we hope that the Portal will contribute to the practical implementation and use of our Framework Arrangement. In addition to that we are also following the practical implementation of the Defence and Security Procurement and Intra Community Transfer Directives in Member States and the impact these will have on SoS.
Recently we also started discussions on how to involve industry in our work on SoS. The current Polish Presidency of the EU held a high-level seminar on this topic in September, which we consider a good kick-off for our work on this.
The way ahead looks challenging and interesting!