### the programme shall provide support for actions by beneficiaries in the development phase covering both new and the upgrade of existing products and technologies , in relation to : ### the programme shall provide support for actions by beneficiaries in the development phase covering both new and the upgrade of existing products and technologies , which will create real added value in the territory of the union as follows :


### in case a project manager is appointed by member states , the commission shall execute the payment to the eligible beneficiaries after informing the project manager . ### member states shall appoint a project manager who shall follow the contract on their behalf and inform the commission when the payment to the eligible beneficiaries is to be executed . the eligible beneficiaries , in the consortium , shall appoint their own project manager who shall cooperate with the project manager appointed by the member states .


### the promotion of innovation and technological development in the union defence industry should take place in a manner coherent with the security interests of the union . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . where appropriate regional or international cooperative initiatives , such as in the nato context , and serving the union security and defence interest , may also be taken into account . ### the promotion of innovation and technological development in the defence industry in the member states should take place in a manner coherent with the security interests of the union as defined within the context of the common foreign and security policy and the common security and defence policy . it should also allow the maintenance and development of the skills and knowhow of the defence industry in the member states and contribute to strengthening the union ' s technological and industrial autonomy . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . member states ' pesco national implementation plans comprising of concrete actions should be coordinated with the programme . where appropriate regional or international cooperative capability initiatives , such as in the nato context , and serving the union security and defence interest , should also be taken into account and should not lead to duplicated efforts .


### article 10 award criteria actions proposed for funding under the programme shall be evaluated on the basis of the following cumulative criteria : excellence contribution to the innovation and technological development of defence industries and thus to fostering the industrial autonomy of the union in the field of defence technologies ; and , contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities commonly agreed by member states within the union ; and , viability notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions ; and for actions described in points to of article 6 , the contribution to the competitiveness of the european defence industry through the demonstration by the beneficiaries that member states have committed to jointly produce and procure the final product or technology in a coordinated way , including joint procurement where applicable . ### article 10 award criteria actions proposed for funding under the programme shall be evaluated in a transparent manner , based on objective and measurable parameters , taking into account the overall aim of the programme and in particular to support , leverage and level - up the cross - border cooperation between undertakings on the basis of the following criteria : contribution to the security and defence interests of the union by enhancing defence technologies which contribute to the implementation of defence capability priorities commonly agreed by member states within the union in the context of the capability development plan or the coordinated annual review on defence and , where appropriate , in the context of regional and international cooperative agreements ; and , contribution to excellence , industrial performance and competition by showing that the proposed work achieves measurable enhancements and significant advantages over existing products or technologies , or when the project aims at the development of a critical or a breakthrough technology ; and , viability , notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions and private sources of funding ; and , contribution to innovation in particular by showing that the proposed actions include ground - breaking or novel concepts and approaches , new promising future technological improvements or the application of technologies or concepts previously not applied in defence sector and thus to the technological development of defence industries and to fostering the industrial autonomy of the union in relation to the capability requirements under the common security and defence policy ; contribution to the unification of technical specifications ; the proportion of the overall budget for the action that is to be allocated in such a way as to enable participation by smes established in the european union that provide added value , whether as members of the consortium or as subcontractors , and in particular to smes that are not established in the member states in which the undertakings in the consortium are established ; contribution to greater efficiency and lower costs in the european defence industry by reducing duplication and overlaps ; increased or new cross - border cooperation ; for actions described in points to of article 6 , the contribution to a more efficient and further integrated european defence sector through the demonstration by the beneficiaries that member states have declared to jointly produce and procure or intend to jointly use , own or maintain the final product or technology in a coordinated way .


### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive and innovative european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development . ### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing and acquiring appropriate and sufficient defence capabilities , enabling it to respond to security challenges , as well as to foster a competitive , transparent , effective and innovative european defence industry &#8211 ; ensuring a sustainable supply chain &#8211 ; and to contribute to the strategic autonomy and technological and industrial independence of the union . it proposed in particular to launch a european defence fund , enhancing synergies and budgetary efficiency , to support investment in joint research and the joint development of defence equipment and technologies . the fund should complement national budgets used for that purpose , and should encourage member states to invest more in the area of defence and in union ' s common defence strategies . the fund would support cooperation during the whole cycle of defence product and technology development .


### to foster the competitiveness and innovation capacity of the union defence industry by supporting actions in their development phase ; ### to foster the competitiveness and innovation capacity of the defence industry in the union and to acquire technological and industrial autonomy by supporting actions carried out on union territory in the development phase of defence technologies and products ;


### the programme shall provide support for actions by beneficiaries in the development phase covering both new and the upgrade of existing products and technologies , in relation to : ### the programme shall provide support for actions by beneficiaries in the development phase covering both new and the upgrade of existing products and technologies developed wholly or in significant part in the union by member states , in relation to :


### the work programme shall ensure that a credible proportion of the overall budget will benefit actions enabling the cross - border participation of smes . ### the work programme shall ensure that at least 20% of the overall budget will benefit actions enabling cooperation between smes from several member states .


### to support greater efficiency and effectiveness of future union policy actions , the commission shall draw up a retrospective evaluation report and send it to the european parliament and to the council . the report - building on relevant consultations of member states and key stakeholders - shall notably assess the progress made towards the achievement of objectives set out in article 2 . it shall also analyse cross border participation of smes in projects implemented under the programme as well as the participation of smes to the global value chain . ### to support greater efficiency and effectiveness of future union policy actions , the commission and the high representative of the union for foreign affairs and security policy / vice - president of the commission shall draw up a retrospective evaluation report and send it to the european parliament and to the council . the report - building on relevant consultations of member states and key stakeholders - shall notably assess the progress made towards the achievement of objectives set out in article 2 . it shall also analyse cross border participation , including that of mid - caps , in projects implemented under the programme as well as the participation of mid - caps to the value chains of defence technologies or products . the report shall also include information on the origin of beneficiaries and , where possible , the distribution of the intellectual property rights that are generated .


### as the objective of the programme is to support the competitiveness of the union defence industry by de - risking the development phase of cooperative projects , actions related to the development of a defence product or technology , namely definition of common technical specifications , design , prototyping , testing , qualification , certification as well feasibility studies and other supporting measures , should be eligible to benefit from it . this will also apply to the upgrade of existing defence products and technologies . ### as the objective of the programme is to support the integration of the union defence industry by bearing some of the risk at the development phase of cooperative projects , actions related to the development of a defence product or technology , namely definition of common technical specifications , design , prototyping , testing , qualification , certification , feasibility studies and other supporting measures as well as actions aimed at converting military production lines into civilian production lines , should be eligible to benefit from it . this will also apply to the upgrade of existing defence products and technologies .


### given that the programme aims particularly at enhancing cooperation between undertakings across member states , an action should be eligible for funding under the programme only if it is undertaken by a cooperation of at least three undertakings based in at least two different member states . ### given that the programme aims particularly at enhancing cooperation between undertakings across member states , an action should be eligible for funding under the programme only if it is undertaken by a cooperation of at least three undertakings based in at least two different member states ; the number of member states involved should be taken into account in the evaluation of proposals for action , as well as the industrial footprint of the sector concerned .


### in view of the specificities of the sector , in practice no collaborative project between undertakings will be launched if the member states have not first agreed to support such projects . after having defined common defence capability priorities at union - level and also taking into account where appropriate collaborative initiatives on a regional basis , member states identify and consolidate military requirements and define the technical specifications of the project . they may also appoint a project manager in charge of leading the work related to the development of a collaborative project . ### after having defined common defence capability priorities at union level through the capability development plan , also taking into account the coordinated annual review on defence , and with a view to fulfilling the union ' s level of ambition as agreed by the council in its conclusions of 14 november 2016 and endorsed by the european council on 15 december 2016 , member states identify and consolidate military requirements and define the technical specifications of the project . they may also appoint a project manager in charge of leading the work related to the development of a collaborative project .


### an action developed by a beneficiary referred to in article 7 paragraph 2 may benefit from a funding rate increased by an additional 10 percentage points . ### an action developed by a beneficiary referred to in the context of the permanent structured cooperation pursuant to article 7 may benefit from a funding rate increased by an additional 10 percentage points .


### the work programme shall ensure that a credible proportion of the overall budget will benefit actions enabling the cross - border participation of smes . ### the work programme , whose objective is to promote european cooperation , shall ensure that a relevant proportion of at least 20 % of the overall budget is earmarked for specific actions enabling the cross - border participation of smes and / or mid - caps ; a specific category of projects dedicated to smes and / or mid - caps shall be established by the work programme .


### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive and innovative european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development . ### in the european defence action plan , adopted on 30 november 2016 , the commission described many structural problems in the european defence sector , which hamper the efficient use of national resources for providing the defence capabilities needed for an effective common security and defence policy . thus , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing and acquiring defence capabilities to respond to security challenges , to foster a competitive and innovative european defence industry as well as to contribute to the technological and industrial autonomy of the union . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund should complement national defence budgets and provide an incentive for member states to invest more in defence . the fund would support cooperation during the whole cycle of defence product and technology development . to complement national programmes , it should enable the union to introduce a significant leverage effect for national investments to boost cooperation between member states and between their industries . to achieve these objectives it is therefore necessary , at the union level , to enhance the institutional framework for cooperation of member states and undertakings in the defence industrial development sector .


### the financial assistance of the union under the programme should not exceed 20% of the total eligible cost of the action when it relates to prototyping which is often the most costly action in the development phase . the totality of the eligible costs should however be covered for other actions in the development phase . ### the financial assistance of the union under the programme should not exceed 30% of the total eligible cost of the action , including part of the indirect cost of the action , within the meaning of article 126 of regulation no 966 / 2012 , when it relates to system prototyping which is often the most costly action in the development phase . the totality of the eligible costs should however be covered for other actions in the development phase .


### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry , a european defence industrial development programme should be established . the programme should aim at enhancing the competitiveness of the union ' s defence industry inter alia cyber defence by supporting the cooperation between undertakings in the development phase of defence products and technologies . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies . ### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry with a view to the european union’s strategic and technological autonomy , a european defence industrial development programme should be established . the programme should aim at defining and implementing the progressive framing of a common defence policy in accordance with article 2 tfeu and is intended to develop the modern capabilities needed by the armed forces of the member states and to improve their security . this programme should aim at enhancing the competitiveness of the union ' s defence industry inter alia cyber defence by supporting the cooperation between undertakings , including research centres , in the development phase of defence products and technologies leading to greater efficiency and a reduction of resource wasting and overlaps in the defence market . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme , as well as its potential continuation after 2020 , regardless of its form , should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies .


### contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities commonly agreed by member states within the union ; and , ### contribution to the security and defence interests of the union by enhancing defence technologies which contribute to the implementation of the defence capability priorities commonly agreed by member states within the union , as part of the capacity development plan or coordinated annual defence review ; and


### the commission should draw up an implementation report at the end of the programme , examining the financial activities in terms of financial implementation results and where possible , impact . this report should also analyse the cross border participation of smes in projects under the programme as well as the participation of smes to the global value chain . ### the commission should draw up an interim progress report by the end of the first year of implementation and an implementation report at the end of the programme . these reports should analyse the development of industrial expertise and defence capacity , as well as coherence with the foreign policy objectives of the union and its member states and the financial activities in terms of financial implementation results and where possible , impact . they should also analyse and promote the cross - border participation of smes and mid - caps in projects under the programme as well as their participation to the global value chain . the reports should also include information on the origin of beneficiaries .


### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry , a european defence industrial development programme should be established . the programme should aim at enhancing the competitiveness of the union ' s defence industry inter alia cyber defence by supporting the cooperation between undertakings in the development phase of defence products and technologies . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies . ### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry , a european defence industrial development programme should be established . the programme should aim at enhancing the competitiveness of the union ' s defence industry especially cyber defence by supporting the cooperation between undertakings in the development phase of defence products and technologies . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . the programme should lead to efficiency gains enabling the reduction of the overall defence spending in the union while at the same time ensuring the defence capabilities necessary to perform the essential core tasks of collective defence , crisis management and cooperative security . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies .


### given that the programme aims particularly at enhancing cooperation between undertakings across member states , an action should be eligible for funding under the programme only if it is undertaken by a cooperation of at least three undertakings based in at least two different member states . ### given that the programme aims particularly at enhancing cooperation between undertakings across member states , an action should be eligible for funding under the programme only if it is undertaken by a cooperation of at least four undertakings based in at least three different member states . this rule shall not apply to actions in support of conversion from military to civil production .


### the action shall be undertaken in a cooperation of at least three undertakings which are established in at least two different member states . the undertakings which are beneficiaries shall not effectively be controlled , directly or indirectly , by the same entity or shall not control each other . ### the action shall be undertaken in a cooperation of at least three undertakings which are established in at least two different member states . at least three undertakings which are beneficiaries and their subcontractors shall not effectively be controlled , directly or indirectly , by the same entity or shall not control each other .


### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive and innovative european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development . ### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive , innovative and balanced european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies and to promote the member states ' joint purchase and maintenance of defence equipment . the fund would complement national budgets already used for this purpose and should act as an incentive for member states to invest more in defence . the fund would support cooperation during the whole cycle of defence product and technology development by enhancing synergies and budgetary efficiency .


### the commission should establish a multiannual work programme in line with the objectives of the programme . the commission should be assisted in the establishment of the work programme by a committee of member states . in light of the union policy on small and medium enterprises as key to ensuring economic growth , innovation , job creation , and social integration in the union and the fact that the supported actions will typically require trans - national collaboration , it is of importance that the work programme will reflect and enable such cross - border participation of smes and that therefore a proportion of the overall budget will benefit such action . ### the commission should establish a multiannual work programme in line with the objectives of the programme , especially that of competitiveness . the commission should be assisted in the establishment of the work programme by a committee of member states within the meaning of regulation 182 / 2011 . in light of the union policy on small and medium enterprises as key to ensuring economic growth , innovation , job creation , and social integration in the union and the fact that the supported actions will typically require trans - national collaboration , it is of importance that the work programme will reflect and emphasize the role of small and medium - sized enterprises as well as middle capitalisation companies and their cross - border participation and therefore set aside a share of at least 20% of the overall budget to benefit such action .


### article 10 award criteria actions proposed for funding under the programme shall be evaluated on the basis of the following cumulative criteria : excellence contribution to the innovation and technological development of defence industries and thus to fostering the industrial autonomy of the union in the field of defence technologies ; and , contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities commonly agreed by member states within the union ; and , viability notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions ; and for actions described in points to of article 6 , the contribution to the competitiveness of the european defence industry through the demonstration by the beneficiaries that member states have committed to jointly produce and procure the final product or technology in a coordinated way , including joint procurement where applicable . ### article 10 award criteria actions proposed for funding under the programme shall be evaluated in a transparent manner , based on objective and measurable parameters , taking into account the overall aim of the programme and in particular to support , leverage and level - up the cross - border cooperation between undertakings on the basis of the following criteria : contribution to the security and defence interests of the union by enhancing defence technologies which contribute to the implementation of defence capability priorities commonly agreed by member states within the union in the context of the capability development plan or the coordinated annual review on defence and , where appropriate , in the context of regional and international cooperative agreements ; and , contribution to excellence , industrial performance and competition by showing that the proposed work achieves measurable enhancements and significant advantages over existing products or technologies , or when the project aims at the development of a critical or a breakthrough technology ; and , viability , notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions and private sources of funding ; and , contribution to innovation in particular by showing that the proposed actions include ground - breaking or novel concepts and approaches , new promising future technological improvements or the application of technologies or concepts previously not applied in defence sector and thus to the technological development of defence industries and to fostering the industrial autonomy of the union in relation to the capability requirements under the common security and defence policy ; contribution to the unification of technical specifications ; the proportion of the overall budget for the action that is to be allocated in such a way as to enable participation by smes established in the european union that provide added value , whether as members of the consortium or as subcontractors , and in particular to smes that are not established in the member states in which the undertakings in the consortium are established ; contribution to greater efficiency and lower costs in the european defence industry by reducing duplication and overlaps ; increased or new cross - border cooperation ; for actions described in points to of article 6 , the contribution to a more efficient and further integrated european defence sector through the demonstration by the beneficiaries that member states have declared to jointly produce and procure or intend to jointly use , own or maintain the final product or technology in a coordinated way .


### to foster the competitiveness and innovation capacity of the union defence industry by supporting actions in their development phase ; ### to foster the competitiveness and innovation capacity of the defence industry in the union and to acquire technological and industrial autonomy by supporting actions carried out on union territory in the development phase of defence technologies and products ;


### each applicant shall declare , by written statement , that it is fully aware of and compliant with applicable national and union legislation and regulations relating to activities in the domain of defence . ### each member of a consortium wishing to participate in an action shall declare , by written statement , that it is fully aware of and compliant with applicable national and union legislation and regulations relating to activities in the domain of defence , including the council common position 2008 / 944 / cfsp of 8 december 2008 defining common rules governing control of exports of military technology and equipment , the community regime for the control of exports , transfer , brokering and transit of dual - use items and the relevant national legislation on export controls .


### the commission shall be assisted by a committee . that committee shall be a committee within the meaning of regulation no 182 / 2011 . the european defence agency shall be invited as observer . ### the commission shall be assisted by a committee . that committee shall be a committee within the meaning of regulation no 182 / 2011 . the european defence agency and the european parliament shall be invited as observers .


### the proposals submitted following the call for proposals shall be evaluated by the commission assisted by independent experts on the basis of the award criteria of article 10 . ### the proposals submitted following the call for proposals shall be evaluated by the commission assisted by independent experts to be validated upon request by member states , on the basis of the eligibility and award criteria set out in articles 6 , 7 , 8 , 9 and 10 . close cooperation between governments , industries and r&t organisations is crucial for success of the programme .


### in order to ensure that the funded actions will contribute to the competitiveness of the european defence industry , they should be market - oriented and demand driven . therefore , the fact that member states have already committed to jointly produce and procure the final product or technology , possibly in a coordinated way , should be taken into account in the award criteria . ### in order to ensure that the funded actions will contribute to the competitiveness of the european defence industry , they should be market - oriented and demand driven , with a view to consolidate the european defence demand . therefore , the fact that member states have already committed to jointly produce and procure the final product or technology , possibly in a coordinated way , should be taken into account in the award criteria .


### contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities commonly agreed by member states within the union ; and , ### contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities agreed by the union ; and ,


### the promotion of innovation and technological development in the union defence industry should take place in a manner coherent with the security interests of the union . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . where appropriate regional or international cooperative initiatives , such as in the nato context , and serving the union security and defence interest , may also be taken into account . ### the promotion of innovation and technological development in the defence industry in the member states should take place in a manner coherent with the security interests of the union as defined within the context of the common foreign and security policy and the common security and defence policy . it should also allow the maintenance and development of the skills and knowhow of the defence industry in the member states and contribute to strengthening the union ' s technological and industrial autonomy . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . member states ' pesco national implementation plans comprising of concrete actions should be coordinated with the programme . where appropriate regional or international cooperative capability initiatives , such as in the nato context , and serving the union security and defence interest , should also be taken into account and should not lead to duplicated efforts .


### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive and innovative european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development . ### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing and acquiring appropriate and sufficient defence capabilities enabling it to respond to security challenges , to foster a competitive , transparent , effective and innovative european defence industry &#8211 ; ensuring a sustainable supply chain &#8211 ; and to contribute to the strategic autonomy and technological and industrial independence of the union . it proposed in particular to launch a european defence fund , enhancing synergies and budgetary efficiency , to support essential investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development .


### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing defence capabilities to respond to security challenges , as well as to foster a competitive and innovative european defence industry . it proposed in particular to launch a european defence fund to support investment in joint research and the joint development of defence equipment and technologies . the fund would support cooperation during the whole cycle of defence product and technology development . ### in the european defence action plan , adopted on 30 november 2016 , the commission committed to complement , leverage and consolidate collaborative efforts by member states in developing and acquiring appropriate and sufficient defence capabilities , enabling it to respond to security challenges , as well as to foster a competitive , transparent , effective and innovative european defence industry &#8211 ; ensuring a sustainable supply chain &#8211 ; and to contribute to the strategic autonomy and technological and industrial independence of the union . it proposed in particular to launch a european defence fund , enhancing synergies and budgetary efficiency , to support investment in joint research and the joint development of defence equipment and technologies . the fund should complement national budgets used for that purpose , and should encourage member states to invest more in the area of defence and in union ' s common defence strategies . the fund would support cooperation during the whole cycle of defence product and technology development .


### the promotion of innovation and technological development in the union defence industry should take place in a manner coherent with the security interests of the union . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . where appropriate regional or international cooperative initiatives , such as in the nato context , and serving the union security and defence interest , may also be taken into account . ### the promotion of innovation and technological development in the union defence industry should allow the maintenance and development of the skills and know - how of the union ' s defence industry and contribute to strengthening its technological and industrial autonomy . it should also take place in a manner coherent with the security interests of the union . accordingly , the action ' s contribution to those interests and to the defence capability priorities commonly agreed by member states should serve as an award criterion . within the union , common defence capability priorities are identified notably through the capability development plan . other union processes such as the coordinated annual review on defence and the permanent structured cooperation will support the implementation of relevant priorities through enhanced cooperation . where appropriate regional or international cooperative initiatives , such as in the nato context , and serving the union security and defence interest , may also be taken into account .


### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry , a european defence industrial development programme should be established . the programme should aim at enhancing the competitiveness of the union ' s defence industry inter alia cyber defence by supporting the cooperation between undertakings in the development phase of defence products and technologies . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies . ### in order to contribute to the enhancement of the competitiveness and innovation capacity of the union ' s defence industry , a european defence industrial development programme should be established . the programme should aim at enhancing the competitiveness of the union ' s defence industry inter alia cyber defence by supporting the cooperation between member states and undertakings in the development phase of defence products and technologies . the development phase , which follows the research and technology phase , entails significant risks and costs that hamper the further exploitation of the results of research and adversely impact the competitiveness of the union ' s defence industry . by supporting the development phase , the programme would contribute to a better exploitation of the results of defence research and it would help to cover the gap between research and production as well as to promote all forms of innovation . the programme should complement activities carried out in accordance with article 182 tfeu and it does not cover the production of defence products and technologies .


### to support and leverage the cooperation between undertakings , including small and medium - sized enterprises , in the development of technologies or products in line with defence capability priorities commonly agreed by member states within the union ; ### to support , leverage and level the cross - border cooperation between undertakings , including promoting the participation of small and medium - sized enterprises as well as mid - caps and research centres , in the value chains of defence technologies or products while avoiding the duplication of industrial skills and crowding - out effects for national defence investments ; where appropriate , and taking into account that unnecessary duplication should be avoided , regional or international cooperative initiatives , such as those in the nato context , which serve the union security and defence interests , shall also be taken into account ;


### beneficiaries shall be undertakings established in the union , in which member states and / or nationals of member states own more than 50% of the undertaking and effectively control it within the meaning of article 6 , whether directly or indirectly through one or more intermediate undertakings . in addition , all infrastructure , facilities , assets and resources used by the participants , including subcontractors and other third parties , in actions funded under the programme shall not be located on the territory of non - member states during the entire duration of the action . ### beneficiaries and their subcontractors shall be public or private undertakings established in the union . the infrastructure , facilities , assets and resources used by the beneficiaries , including subcontractors and other third parties , in actions funded under the programme shall not be located on the territory of non - member states during the entire duration of the action or the production . the use of those infrastructures , facilities , assets and resources shall not be subject to control or restrictions by third countries or third - country entities . the beneficiaries ' ultimate controlling company should be headquartered in the union .


### where reference is made to this paragraph , article 5 of regulation no 182 / 2011 shall apply . ### where reference is made to this paragraph , article 5 of regulation no 182 / 2011 shall apply . where the committee delivers no opinion , the commission shall not adopt the draft implementing act and the third subparagraph of article 5 of regulation no 182 / 2011 shall apply .


### the financial assistance of the union provided under the programme may not exceed 20% of the total cost of the action where it relates to prototyping . in all the other cases , the assistance may cover up to the total cost of the action . ### the financial assistance of the union provided under the programme may not exceed 20% of the total cost of the action where it relates to design or system prototyping . in all the other cases , the assistance may cover up to 50% of the total cost of the action .


### the action shall be undertaken in a cooperation of at least three undertakings which are established in at least two different member states . the undertakings which are beneficiaries shall not effectively be controlled , directly or indirectly , by the same entity or shall not control each other . ### the action shall be undertaken in a cooperation of at least three undertakings which are established in at least three different member states and shall remain open to other undertakings based in other member states . none of those three undertakings which are beneficiaries shall effectively be controlled , directly or indirectly , by the same entity or shall control each other .


### article 10 award criteria actions proposed for funding under the programme shall be evaluated on the basis of the following cumulative criteria : excellence contribution to the innovation and technological development of defence industries and thus to fostering the industrial autonomy of the union in the field of defence technologies ; and , contribution to the security and defence interests of the union by enhancing defence technologies which contribute to implement defence capability priorities commonly agreed by member states within the union ; and , viability notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions ; and for actions described in points to of article 6 , the contribution to the competitiveness of the european defence industry through the demonstration by the beneficiaries that member states have committed to jointly produce and procure the final product or technology in a coordinated way , including joint procurement where applicable . ### article 10 award criteria actions proposed for funding under the programme shall be evaluated in a transparent manner , based on objective and measurable parameters , taking into account the overall aim of the programme and in particular to support , leverage and level - up the cross - border cooperation between undertakings on the basis of the following criteria : contribution to the security and defence interests of the union by enhancing defence technologies which contribute to the implementation of defence capability priorities commonly agreed by member states within the union in the context of the capability development plan or the coordinated annual review on defence and , where appropriate , in the context of regional and international cooperative agreements ; and , contribution to excellence , industrial performance and competition by showing that the proposed work achieves measurable enhancements and significant advantages over existing products or technologies , or when the project aims at the development of a critical or a breakthrough technology ; and , viability , notably via a demonstration by the beneficiaries that the remaining costs of the eligible action are covered by other means of financing such as member states’ contributions and private sources of funding ; and , contribution to innovation in particular by showing that the proposed actions include ground - breaking or novel concepts and approaches , new promising future technological improvements or the application of technologies or concepts previously not applied in defence sector and thus to the technological development of defence industries and to fostering the industrial autonomy of the union in relation to the capability requirements under the common security and defence policy ; contribution to the unification of technical specifications ; the proportion of the overall budget for the action that is to be allocated in such a way as to enable participation by smes established in the european union that provide added value , whether as members of the consortium or as subcontractors , and in particular to smes that are not established in the member states in which the undertakings in the consortium are established ; contribution to greater efficiency and lower costs in the european defence industry by reducing duplication and overlaps ; increased or new cross - border cooperation ; for actions described in points to of article 6 , the contribution to a more efficient and further integrated european defence sector through the demonstration by the beneficiaries that member states have declared to jointly produce and procure or intend to jointly use , own or maintain the final product or technology in a coordinated way .


### the programme shall have the following objectives : ### in an effort to progressively frame a common defence policy in accordance with article 2 tfeu , to enhance the collaboration between member states and the freedom of action of the member states and the union as well as in order to align foreign and security policy requirements with operational capacity and in accordance with common defence capability priorities agreed by member states in the context of the capability development plan of the common security and defence policy , the programme shall have the following objectives :


### the commission should draw up an implementation report at the end of the programme , examining the financial activities in terms of financial implementation results and where possible , impact . this report should also analyse the cross border participation of smes in projects under the programme as well as the participation of smes to the global value chain . ### the commission should draw up an interim progress report by the end of the first year of implementation and an implementation report at the end of the programme . these reports should analyse the development of industrial expertise and defence capacity , as well as coherence with the foreign policy objectives of the union and its member states and the financial activities in terms of financial implementation results and where possible , impact . they should also analyse and promote the cross - border participation of smes and mid - caps in projects under the programme as well as their participation to the global value chain . the reports should also include information on the origin of beneficiaries .


### where a competent authority has exhausted all applicable means to obtain access to the data , it may request the assistance of a competent authority in another member state in accordance with the procedure laid down in article 7 , and the requested competent authority shall provide assistance in accordance with the procedure laid down in article 7 , unless it would be contrary to the public order of the requested member state . ### for the purposes of paragraph 1 of this article , where a competent authority does not receive access to data from a natural or legal persons , and if no specific cooperation mechanism exists under union law or international agreements to exchange data between competent authorities of different member states , that competent authority may request the assistance from a competent authority of another member state in accordance with the procedure set out in article 7 .


### the commission shall encourage and facilitate the development of self - regulatory codes of conduct at union level , in order to define guidelines on best practices in facilitating the switching of providers and to ensure that they provide professional users with sufficiently detailed , clear and transparent information before a contract for data storage and processing is concluded , as regards the following issues : ### the commission may adopt implementing acts in order to specify requirements to facilitate the switching of providers and to ensure that they provide professional users with sufficiently detailed clear and transparent information before a contract for data storage and processing is concluded as regards the following issues :


### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 67930 , directive 2016 / 68031 and directive 2002 / 58 / ec32 should not be affected by this regulation . _________________ 30 regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31 directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha . 32 directive 2002 / 58 / ec of the european parliament and of the council of 12 july 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector . ### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 67930 and directive 2016 / 68031 are not affected by this regulation . the legal framework on the respect for private life and the protection of personal data in electronic communications , in particular directive 2002 / 58 / ec , is not affected by this regulation . _________________ 30 regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31 directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha .


### in order to take full advantage of the competitive environment , professional users should be able to make informed choices and easily compare the individual components of various data storage or other processing services offered in the internal market , including as to the contractual conditions of porting data upon the termination of a contract . in order to align with the innovation potential of the market and to take into account the experience and expertise of the providers and professional users of data storage or other processing services , the detailed information and operational requirements for data porting should be defined by market players through self - regulation , encouraged and facilitated by the commission , in the form of union codes of conduct which may entail model contract terms . nonetheless , if such codes of conduct are not put in place and effectively implemented within a reasonable period of time , the commission should review the situation . ### in order to take full advantage of the competitive environment , professional users should be able to make informed choices and easily compare the individual components of various data storage or other processing services offered in the internal market , including as to the contractual conditions of porting data upon the termination of a contract . in order to align with the innovation potential of the market and to take into account the experience and expertise of the providers and professional users of data storage or other processing services , the detailed information and operational requirements for data porting should be defined by market players based on commission non - binding guidelines , in the form of union codes of conduct which may entail model contract terms . when drafting the guidelines , the commission may take into account “cloud service level agreement standardisation guidelines” and the activities performed within the cloud stakeholders’ platform initiative . the commission shall ensure that all relevant stakeholders , including small and medium enterprises and start - ups are consulted in the process . nonetheless , if such codes of conduct are not put in place and effectively implemented or do not sufficiently meet the objectives of the proposed regulation , the commission should review the situation within two years after the entry into force of this regulation and introduce , if appropriate , a statutory right to data portability .


### data localisation requirements represent a clear barrier to the free provision of data storage or other processing services across the union and to the internal market . as such , they should be banned unless they are justified based on the grounds of public security , as defined by union law , in particular article 52 of the treaty on the functioning of the european union , and satisfy the principle of proportionality enshrined in article 5 of the treaty on european union . in order to give effect to the principle of free flow of non - personal data across borders , to ensure the swift removal of existing data localisation requirements and to enable for operational reasons storage or other processing of data in multiple locations across the eu , and since this regulation provides for measures to ensure data availability for regulatory control purposes , member states should not be able to invoke justifications other than public security . ### data localisation requirements represent a clear barrier to the free provision of data storage or other processing services across the union and to the internal market . as such , they should be banned unless they are justified based on imperative grounds of public security , as defined by union law , in particular article 52 of the treaty on the functioning of the european union , and satisfy the principle of proportionality enshrined in article 5 of the treaty on european union . in order to give effect to the principle of free flow of non - personal data across borders , to ensure the swift removal of existing data localisation requirements and to enable for operational reasons storage or other processing of data in multiple locations across the eu , and since this regulation provides for measures to ensure data availability for regulatory control purposes , member states should not be able to invoke justifications other than public security .


### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 67930 , directive 2016 / 68031 and directive 2002 / 58 / ec32 should not be affected by this regulation . _________________ 30 regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31 directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha . 32 directive 2002 / 58 / ec of the european parliament and of the council of 12 july 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector . ### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 67930 and directive 2016 / 68031 as well as the legal framework on the respect for private life and the protection of personal data in electronic communications , in particular directive 2002 / 58 / ec32 to be repealed by new regulation 2017 / 003 32a should not be affected by this regulation . _________________ 30 regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31 directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha . 32 directive 2002 / 58 / ec of the european parliament and of the council of 12 july 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector . 32a regulation of the european parliament and the council concerning the respect for private life and the protection of personal data in electronic communications and repealing directive 2002 / 58 / ec .


### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 679 , 30 directive 2016 / 68031 and directive 2002 / 58 / ec32 should not be affected by this regulation . _________________ 30regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha . 32directive 2002 / 58 / ec of the european parliament and of the council of 12 july 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector . ### the legal framework on the protection of natural persons with regard to the processing of personal data , in particular regulation 2016 / 679 , 30 directive 2016 / 68031 and directive 2002 / 58 / ec32 must not be affected by this regulation . _________________ 30regulation 2016 / 679 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data , and repealing directive 95 / 46 / ec . 31directive 2016 / 680 of the european parliament and of the council of 27 april 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention , investigation , detection or prosecution of criminal offences or the execution of criminal penalties , and on the free movement of such data , and repealing council framework decision 2008 / 977 / jha . 32directive 2002 / 58 / ec of the european parliament and of the council of 12 july 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector .


### data localisation requirements represent a clear barrier to the free provision of data storage or other processing services across the union and to the internal market . as such , they should be banned unless they are justified based on the grounds of public security , as defined by union law , in particular article 52 of the treaty on the functioning of the european union , and satisfy the principle of proportionality enshrined in article 5 of the treaty on european union . in order to give effect to the principle of free flow of non - personal data across borders , to ensure the swift removal of existing data localisation requirements and to enable for operational reasons storage or other processing of data in multiple locations across the eu , and since this regulation provides for measures to ensure data availability for regulatory control purposes , member states should not be able to invoke justifications other than public security . ### data localisation requirements represent a clear barrier to the free provision of data storage or other processing services across the union and to the internal market . as such , they should be banned unless they are justified based on the grounds of public security , as defined by union law , in particular article 52 of the treaty on the functioning of the european union , and satisfy the principle of proportionality enshrined in article 5 of the treaty on european union . regardless of this data storage or other processing of authorities and political bodies of national or federal governments and parliaments should be always considered to be justified for grounds of public security . in order to give effect to the principle of free flow of non - personal data across borders , to ensure the swift removal of existing data localisation requirements and to enable for operational reasons storage or other processing of data in multiple locations across the eu , and since this regulation provides for measures to ensure data availability for regulatory control purposes , member states should not be able to invoke justifications other than public security .


### public procurement is used by public authorities to ensure value for public money spent and to contribute to a more innovative , sustainable , inclusive and competitive internal market . directive 2014 / 23 / eu of the european parliament and of the council49 , directive 2014 / 24 / eu of the european parliament and of the council50 and directive 2014 / 25 / eu of the european parliament and of the council51 provide the legal framework for the integration and effective functioning of the public procurement markets representing 14% of union’s gross domestic product , to the benefit of public authorities , businesses as well as citizens , including consumers . the programme should therefore support measures to ensure a wider uptake of strategic public procurement , the professionalisation of public buyers , improved access to procurement markets for smes , increase of transparency , integrity and better data , boosting the digital transformation of procurement and promotion of joint procurement , through strengthening a partnership approach with the member states , improving data gathering and data analysis including through development of dedicated it tools , supporting exchange of experiences and good practices , providing guidance , pursuing beneficial trade agreements , strengthening cooperation among national authorities and launching pilot projects . _________________ 49 directive 2014 / 23 / eu of the european parliament and of the council of 26 february 2014 on the award of concession contracts . 50 directive 2014 / 24 / eu of the european parliament and of the council of 26 february 2014 on public procurement and repealing directive 2004 / 18 / ec . 51 directive 2014 / 25 / eu of the european parliament and of the council of 26 february 2014 on procurement by entities operating in the water , energy , transport and postal services sectors and repealing directive 2004 / 17 / ec . ### public procurement is used by public authorities to ensure value for public money spent and to contribute to a more innovative , sustainable , inclusive and competitive internal market , including by applying criteria other than simply the lowest price or cost effectiveness , taking into account qualitative , environmental and / or social aspects . directive 2014 / 23 / eu of the european parliament and of the council49 , directive 2014 / 24 / eu of the european parliament and of the council50 and directive 2014 / 25 / eu of the european parliament and of the council51 provide the legal framework for the integration and effective functioning of the public procurement markets representing 14% of union’s gross domestic product , to the benefit of public authorities , businesses as well as citizens , including consumers . the programme should therefore support measures to ensure a wider uptake of strategic public procurement , the professionalisation of public buyers , to facilitate and improve access to procurement markets for smes and microenterprises , in particular through advisory services and training , increase of transparency , integrity and better data , boosting the digital transformation of procurement and promotion of joint procurement , through strengthening a partnership approach with the member states , improving data gathering and data analysis including through development of dedicated it tools , supporting exchange of experiences and good practices , referencing european and international standards , providing guidance , pursuing beneficial trade agreements , strengthening cooperation among national authorities and launching pilot projects . _________________ 49 directive 2014 / 23 / eu of the european parliament and of the council of 26 february 2014 on the award of concession contracts . 50 directive 2014 / 24 / eu of the european parliament and of the council of 26 february 2014 on public procurement and repealing directive 2004 / 18 / ec . 51 directive 2014 / 25 / eu of the european parliament and of the council of 26 february 2014 on procurement by entities operating in the water , energy , transport and postal services sectors and repealing directive 2004 / 17 / ec .


### placing on the market of products that are not compliant with union law puts those who comply at disadvantage and may endanger consumers . many entrepreneurs disregard the rules either through lack of knowledge or intentionally to gain a competitive advantage . market surveillance authorities are often underfunded and constrained by national boundaries , while entrepreneurs trade at union or even global level . in particular , in the case of e - commerce , market surveillance authorities have great difficulties in tracing non - compliant products imported from third countries and identifying the responsible entity within their jurisdiction . the programme should therefore seek to strengthen product compliance by providing the right incentives to entrepreneurs , intensifying compliance checks and promoting closer cross - border cooperation among enforcement authorities . the programme should also contribute to the consolidation of the existing framework for market surveillance activities , encourage joint actions of market surveillance authorities from different member states , improve the exchange of information and promote convergence and closer integration of market surveillance activities . ### placing on the market of products that are not compliant with union law regardless of whether products are placed on the market by traditional or electronic means and regardless of whether they are produced in the union or enter it from third countries , puts european citizens and consumers at risk . economic operators selling compliant products face distorted competition from those who do not comply with the rules either due to lack of knowledge or intentionally to gain a competitive advantage . market surveillance authorities are often underfunded and constrained by national boundaries , while entrepreneurs trade at union or even global level . in particular , in the case of e - commerce , market surveillance authorities have great difficulties in tracing non - compliant products imported from third countries , identifying the responsible entity within their jurisdiction or conducting risk - assessments or safety tests due to the lack of physical access to products . the programme should therefore seek to strengthen product compliance by strengthening market surveillance , providing clear , transparent and comprehensive rules to economic operators , intensifying compliance checks and promoting closer cross - border cooperation among enforcement authorities . the programme should also contribute to the consolidation of the existing framework for market surveillance activities , encourage joint actions of market surveillance authorities from different member states , improve the exchange of information and promote convergence and closer integration of market surveillance activities , in particular by ensuring that the provisions of the regulation 2018 / 858 of the european parliament and of the council1a are strictly implemented so as to avoid the sale of non - compliant products to european citizens . __________________ 1a regulation 2018 / 858 of the european parliament and of the council of 30 may 2018 on the approval and market surveillance of motor vehicles and their trailers , and of systems , components and separate technical units intended for such vehicles , amending regulations no 715 / 2007 and no 595 / 2009 and repealing directive 2007 / 46 / ec .


### a modern internal market promotes competition and benefits consumers , businesses and employees . making better use of the ever evolving internal market in services should help european businesses create jobs and grow across borders , offer wider choice of services at better prices , and maintain high standards for consumers and workers . to achieve this , the programme should contribute to the removal of remaining barriers , and to ensure a regulatory framework that can accommodate new innovative business models . ### a modern internal market promotes competition , high quality services for the benefit of consumers and businesses and working conditions of employees . it creates a favourable environment for job creation as well as it ensures a better functioning of high - quality services of general economic interest . making better use of the ever evolving internal market in services should help european businesses create quality jobs and grow across borders , offer wider choice of services at better prices , and maintain high standards for consumers and workers . to achieve this , the programme should contribute to the removal of remaining barriers , and to ensure a regulatory framework that can accommodate new innovative business models consistent with a high level of social protection including for entrepreneurs .


### to improve the functioning of the internal market , and especially to protect and empower citizens , consumers and businesses , in particular micro , small and medium - sized enterprises , by enforcement of union law , facilitation of market access , standard setting , and by promoting human , animal and plant health and animal welfare ; as well as to enhance cooperation between the competent authorities of member states and between the competent authorities of member states and the commission and the decentralised union agencies ; ### to improve the functioning of the internal market , and especially to protect and empower citizens , consumers and businesses , in particular micro , small and medium - sized enterprises , by enforcement of union law , facilitating market access , standard setting , by ensuring a uniform and high level of consumer protection , raising awareness about the single market union law and by promoting human , animal and plant health and animal welfare ; as well as to enhance cooperation between the competent authorities of member states and between the competent authorities of member states and the commission and the decentralised union agencies ;


### the programme should provide effective support for smes throughout their life - cycle . it should build on the unique knowledge and expertise developed with regard to smes and industrial sectors and on a long experience in working with european , national and regional stakeholders . this support should build on the successful experience of the enterprise europe network as a one - stop - shop to improve smes competitiveness and develop their business in the single market and beyond . the network plans to continue delivering services on behalf of other union programmes , notably for the horizon2020 programme , using the financial resources of these programmes . also the mentoring scheme for new entrepreneurs should remain the tool to enable new or aspiring entrepreneurs to gain business experience by matching with an experienced entrepreneur from another country and thus allow strengthening entrepreneurial talents . the programme should further strive to grow and extend its geographical coverage and thus offer wider range of matching possibilities to entrepreneurs in complementarity with other union initiatives where relevant . ### the programme should provide effective support for smes throughout their life - cycle , providing assistance ranging from project preparation through to commercialisation and access to the market , and encouraging the creation of business enterprise networks . it should build on the unique knowledge and expertise developed with regard to smes and economic and entrepreneurial sectors and on a long experience in working with european , national and regional stakeholders . this support should build on the experience of the enterprise europe network as a one - stop - shop to improve smes competitiveness and develop their business in the single market and beyond . the network plans to continue delivering services on behalf of other union programmes , notably for the horizon2020 programme , using the financial resources of these programmes . it should also support enhanced participation of smes representatives’ organisation in the development of single market policy initiative , such as public procurement , standardisation processes and intellectual property regimes . the network should also increase the number of actions , providing more targeted advice to sme , in drafting projects and supporting networking and technological and organisational transition . the network should also improve cooperation and liaison with other advisory hubs established in the digital programme and investeu as regards access to finance . the cosme actions in the network should also aim to provide high quality services across europe , paying particular attention to areas of activities and geographical parts of the union where the networks and intermediary stakeholders do not meet expected results . also the successful mentoring scheme for new entrepreneurs - erasmus for young entrepreneurs - should remain the tool to enable new or aspiring entrepreneurs to gain business and managerial experience by matching with an experienced entrepreneur from another country and thus allow strengthening entrepreneurial talents . the programme should grow and extend its geographical coverage and thus offer wider range of matching possibilities to entrepreneurs in complementarity with other union initiatives where relevant . in order to increase the value added by the promotion of entrepreneurship initiatives , special attention should be paid to micro - enterprises and to those that have benefited the least from the existing programme , and where the culture of entrepreneurship remains at a very basic level , and faces more barriers . every effort should be made to achieve reasonably geographically balanced distribution of the funds .


### this regulation establishes the programme for improving the functioning of the internal market and the competitiveness of enterprises , including micro , small and medium - sized enterprises and the framework for financing of development , production and dissemination of european statistics within the meaning of article 13 of regulation no 223 / 2009 . ### this regulation establishes the single market programme for strengthening the internal market and improving its functioning in the fields of competitiveness of enterprises , especially micro , small and medium - sized enterprises , standardisation , consumer protection , food supply chain and the framework for financing of development , production and dissemination of european statistics .


### the power to adopt delegated acts referred to in articles 9 and 17 shall be conferred on the commission until 31 december 2028 . ### the power to adopt delegated acts referred to in articles 9 , 10 and 17 shall be conferred on the commission until 31 december 2028 .


### as consumer markets know no borders with the development of online trade and travel services , it is important to ensure that consumers residing in the union can benefit from adequate protection when importing goods and services from economic operators based in third countries . the programme should therefore allow supporting cooperation with relevant bodies located in key trading third country partners of the union where necessary . ### the development of e - commerce poses certain challenges regarding the protection of the health and safety of end - users from non - compliant products . as consumer markets know no borders with the development of online trade and travel services , it is important to ensure that consumers residing in the union can benefit from equivalent protection when importing goods and services from economic operators based in third countries . the programme should therefore allow supporting cooperation with relevant bodies located in key trading third country partners of the union where necessary with regard to the exchange of information on non - compliant products , on recent scientific developments and new technologies , on emerging risks , and on other aspects related to control activities .


### creation of the right conditions to empower all actors of the internal market , including businesses , citizens and consumers , civil society and public authorities through transparent information and awareness raising campaigns , best practice exchange , promotion of good practices , exchange and dissemination of expertise and knowledge and organization of trainings ; ### creation of the right conditions to empower all actors of the internal market , including businesses , and in particular micro - enterprises , smes , citizens and consumers , civil society and public authorities through transparent information and awareness raising campaigns , best practice exchange , promotion of good practices , exchange and dissemination of expertise and knowledge and organization of trainings ;


### official controls carried out by the member states are an essential tool for verifying and monitoring that relevant union requirements are being implemented , complied with and enforced . the effectiveness and efficiency of official control systems is vital for maintaining a high level of safety for humans , animals and plants along the food chain whilst ensuring a high level of protection of the environment and of animal welfare . union financial support should be made available for such control measures . in particular , a financial contribution should be available to union reference laboratories in order to help them bear the costs arising from the implementation of work programmes approved by the commission . moreover , since the effectiveness of official controls also depends on the availability to the control authorities of well trained staff with an appropriate knowledge of union law , the union should be able to contribute to their training and relevant exchange programmes organised by competent authorities . ### in view of an increasingly globalised food chain , official controls carried out by the member states are now more than ever an essential tool for verifying and monitoring that relevant union requirements are being implemented , complied with and enforced , especially as regards imported food products . the effectiveness and efficiency of official control systems is vital for maintaining a high level of safety for humans , animals and plants along the food chain , as well as consumer confidence , whilst ensuring a high level of protection of the environment and of animal welfare . union financial support should be made available for such control measures . in particular , a financial contribution should be available to union reference laboratories in order to help them bear the costs arising from the implementation of work programmes approved by the commission . financial contribution should also be available to increase the level of controls on imports , in order to tackle phenomena such as illegal imports of bush meat which can put human health at risk and causes biodiversity loss . since the effectiveness of official controls also depends on the availability to the control authorities of well trained staff with an appropriate knowledge of union law , the union should be able to contribute to their training and relevant exchange programmes organised by competent authorities .


### in order to meet the objectives of the programme and to facilitate the lives of citizens and businesses , high - quality user - centric public services need to be put in place . this implies that public administrations will need to start working in new ways , bring down silos between the different parts of their administrations , and to engage in the co - creation of these public services with citizens and businesses . moreover , the continuous and steady increase of cross - border activities in the internal market requires provision of up - to - date information on the rights of businesses and citizens , but also information explaining the administrative formalities . in addition , provision of legal advice and helping to solve problems which occur at cross national level becomes essential . furthermore , connecting national administrations in a simple and efficient manner as well as evaluating how the internal market works on the ground is necessary . the programme should therefore support the following existing internal market governance tools : the your europe portal which should be a backbone of the upcoming single digital gateway , your europe advice , solvit , the internal market information system and the single market scoreboard in order to improve citizens ' daily lives and businesses ' ability to trade across borders . ### in order to meet the objectives of the programme and to facilitate the lives of citizens and businesses , high - quality user - centric public services need to be put in place and e - administration and e - government efforts further boosted . this implies that public administrations will need to start working in new ways , bring down silos between the different parts of their administrations , and to engage in the co - creation of these public services with citizens and businesses . moreover , the continuous and steady increase of cross - border activities in the internal market requires the availability of up - to - date information on the rights of businesses and citizens , but also information explaining the administrative formalities . in addition , provision of legal advice and helping to solve problems which occur at cross national level becomes essential . furthermore , connecting national administrations in a simple and efficient manner as well as evaluating how the internal market works on the ground is necessary . the existing internal market governance tools already play an important role in facilitating the achievement of those objectives . to this end , and in order to keep up with technology and market developments , as well as with new regulatory and enforcement challenges , the programme should support the enhancing of quality , visibility and transparency and of the security of the internal market governance tools . the programme should therefore support , among others , the following existing internal market governance tools : the your europe portal which should be a backbone of the upcoming single digital gateway , your europe advice , solvit , the internal market information system and the single market scoreboard in order to improve citizens ' daily lives and businesses ' ability to trade across borders .


### many of the union ' s competitiveness problems involve smes ' difficulties in obtaining access to finance because they struggle to demonstrate their credit - worthiness and have insufficient collateral . additional financing challenges arise from smes ' need to stay competitive by engaging e . g . in digitization , internationalization and innovation activities and skilling up their workforce . limited access to finance has a negative effect on businesses creation , growth and survival rates , as well as on the readiness of new entrepreneurs to take over viable companies in the context of a business succession . ### many of the union ' s competitiveness problems involve smes ' difficulties in obtaining access to finance because they struggle to demonstrate their credit - worthiness and have insufficient collateral . additional financing challenges arise from the smaller size of micro - enterprises and smes ' need to stay competitive by engaging e . g . in digitization , internationalization and innovation activities and skilling up their workforce . limited access to finance has a negative effect on businesses creation , growth and survival rates , as well as on the readiness of new entrepreneurs to take over viable companies in the context of a business succession .


### the amount referred to in paragraph 1 may be used for technical and administrative assistance for the implementation of the programme , concerning in particular preparatory , monitoring , control , audit and evaluation activities as well as use of information technology networks focusing on information processing and exchange , and use and development of corporate information technology tools . ### the amount referred to in paragraph 1 may be used for technical and administrative assistance for the implementation of the programme , concerning in particular preparatory , monitoring , control , audit and evaluation activities as well as use of information technology networks focusing on information processing and exchange , and use and development of corporate information technology tools . . the total costs of administrative and technical support will be limited in order to allow the maximum availability of the programme to finance actions covered by the objectives of the programme and shall not exceed in any case a limit of 5% of the overall budget referred to in article 4 .


### the fitness check of union consumer and marketing law carried out by the commission in may 2017 exposed the need to better enforce rules and facilitate redress when consumers have been harmed by breaches to consumer laws . as a result the commission adopted a ' new deal for consumers ' in april 2018 to ensure , inter alia , the equal treatment of consumers across the internal market in relation to dual quality standards , stronger enforcement capacities of member states , enhanced product safety , increased international cooperation and new possibilities for redress notably through representative actions by qualified entities . the programme should aim to support consumer policy with awareness raising and knowledge building , capacity building and exchange of best practices of the consumer organisations and consumer protection authorities , networking and development of market intelligence , strengthening the evidence base on the functioning of the internal market for consumers , it systems and communication tools , inter alia . ### the fitness check of union consumer and marketing law carried out by the commission in may 2017 exposed the need to better enforce rules and facilitate redress when consumers have been harmed by breaches to consumer laws . as a result the commission adopted a ' new deal for consumers ' in april 2018 to ensure , inter alia , the equal treatment of consumers across the internal market in relation to cross - border cases , such as selling of non - compliant products in the motor vehicles sector , dual quality standards of products or the problems of passengers stranded as a result of the cancellation of a large number of flights , stronger enforcement capacities of member states , enhanced product safety , increased international cooperation and new possibilities for redress notably through representative actions by qualified entities . the programme should aim to support consumer policy with awareness raising and knowledge building , capacity building and exchange of best practices of the consumer organisations and consumer protection authorities , networking and development of market intelligence , strengthening the evidence base on the functioning of the internal market for consumers , it systems and communication tools , inter alia .


### a high level of health protection through the food supply chain is necessary to allow the internal market to operate efficiently . a safe and sustainable food supply chain is a prerequisite for society and for the internal market . cross border health crises and food scares disrupt the functioning of the internal market by limiting the movements of persons and goods and disrupting production . ### a high level of health protection through the food supply chain is necessary to allow the internal market to operate efficiently and smoothly . a safe and sustainable food supply chain is a prerequisite for society and for the internal market . cross border health crises and food scares disrupt the functioning of the internal market by limiting the movements of persons and goods and disrupting production . it is of utmost importance to prevent cross border health crises and food scares ; therefore , the programme should support concrete actions , such as establishing emergency measures in the event of crisis situations and unforeseeable events affecting animal and plant health .


### legal entities established in a third country which is not associated to the programme may participate in the following actions : ### the commission may allow legal entities established in a third country which is not associated to the programme to participate in the following actions :