The European Council has approved the commencement of negotiations with the UK and Canada concerning their involvement in the €150bn ($176bn) Security Action for Europe (SAFE) defence loan instrument.
This decision, made on 18 September 2025, authorises the European Commission (EC) to engage in discussions. These talks will focus on the conditions under which British and Canadian companies and products might partake in procurements supported by the SAFE funding initiative.
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Enacted by the council in May 2025, SAFE is a financial tool aimed at assisting EU member states in enhancing their defence capabilities through collective procurement.
It is the first element of the EC’s ReArm Europe Plan/Readiness 2030 initiative. This strategy seeks to facilitate up to €800bn in total defence spending over five years.
The loans provided under SAFE will be available to interested member states upon request and based on their national plans.
These loans will feature competitive pricing and long maturities, requiring repayment by the beneficiary states.
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By GlobalDataThe SAFE framework also accommodates participation from third countries.
This includes acceding countries, candidate countries, potential candidates, and nations that have entered into Security and Defence Partnerships with the EU, such as the UK and Canada. These countries are eligible to join common procurements.
Additionally, Ukraine and European Economic Area-European Free Trade Association (EEA-EFTA) countries will receive treatment equivalent to EU member states, allowing them access to common procurements and equal terms for their industries.
The upcoming negotiations with the UK and Canada will focus on establishing terms for extending access to their companies and products within this framework.
The European Commission is tasked with conducting these negotiations on behalf of the EU, maintaining continuous coordination and dialogue with the council throughout the process.
Upon conclusion of these negotiations, any resulting agreements will require consent from the European Parliament before coming into effect.
In May 2025, the UK government stated that a new agreement with the EU “will pave the way” for Britain’s defence industry to participate in the SAFE defence fund.
