PARIS (Realist English). France, which had sought to limit the UK’s access to the European Security Action for Europe (SAFE) defence fund, has itself fallen victim to the very strict rules it championed.
According to the Financial Times, citing three informed sources, the European Commission has reduced Paris’ requested funding from €16.2 billion to €15.1 billion.
The reason is that a number of Franco-British defence projects failed to meet the criteria that France itself had actively lobbied for.
The ‘65% Rule’ Hits Paris
At the heart of the matter is a rule introduced under the SAFE programme last year at France’s insistence. According to this rule, at least 65% of project costs must be generated within the EU, while the share of third countries cannot exceed 35%.
France had calculated that these criteria would limit British companies’ access to subsidised funding from the €150 billion fund. However, the restrictions ended up affecting joint Franco-British projects involving British partners.
Among the projects that failed to make the cut were developments by MBDA — the European missile consortium whose shareholders include Airbus, Britain’s BAE Systems and Italy’s Leonardo. British and French MBDA subsidiaries jointly produce the Storm Shadow/Scalp long‑range missiles, which are used by the Ukrainian side.
Paris’ Demands to London Stalled Talks
The UK never signed an agreement with the EU on financial participation in the SAFE programme. Talks collapsed after Paris demanded a multi‑billion‑euro contribution from London — more than €6 billion — for participation. At the same time, many other EU partners favoured opening the fund to UK involvement.
As the British parliamentary portal Hansard notes, “France is reported to have been the instigator of the deadlock, demanding an inflated price for the UK’s accession, despite many EU partners wanting to open the fund to UK participation.”
Boomerang for French Defence Industry
France’s attempt to use SAFE rules to limit British participation in European defence programmes has primarily backfired on French defence initiatives implemented jointly with British partners. MBDA projects have lost access to subsidised financing.
The European Commission, as noted, decided to reduce the funding volume specifically because certain projects involving the UK did not meet the criteria that France itself had actively promoted. Reuters sources confirm that the missile programme was among the projects cut.
Paris’s policy has cost French industry access to cheap loans. Projects in which French and British companies are equal partners have been blocked by rules designed precisely to limit British participation. As the Financial Times notes, as a result, “Paris lost the cheap loans it had planned to use for joint Franco‑British projects.”