EU Defence Capabilities after the War in Ukraine: The Act in Support of Ammunition Production and the Development of an EU Defence Industrial Policy

Federico Fabbrini No. 5/2025 Working Paper Series EU Defence Capabilities after the War in Ukraine: The Act in Support of Ammunition Production and the Development of an EU Defence Industrial Policy EU Defence Capabilities after the War in Ukraine: The Act in Support of Ammunition Production and the Development of an EU Defence Industrial Policy Federico Fabbrini1* Abstract This chapter examines Regulation (EU) 2023/1525—the Act in Support of Ammunition Production (ASAP)—as a key element of the European Union’s response to Russia’s invasion of Ukraine and its implications for EU defence capability. ASAP seeks to accelerate ammunition and missile production within the Union by using internal market and industrial policy competences, marking a notable widening of EU involvement in the defence-industrial field. The chapter situates the instrument within the broader post-2022 evolution of CFSP/CSDP, the expansion of EU financial support for Ukraine, and the Union’s emerging economic security agenda. While ASAP represents a meaningful step towards strengthening the European Defence Technological and Industrial Base, its modest €500 million budget and the removal of the Commission’s proposed power to issue priority-rated orders substantially limit its effect. The analysis concludes that, although ASAP moves the EU closer to a defence union, the current framework remains insufficient in light of the ongoing war and the uncertainty surrounding long-term US commitments to European security. 1. Introduction In early summer 2023 the European Parliament (EP) and the Council of the European Union (EU) approved the Act on supporting ammunition production (ASAP), which was published in the EU official journal as Regulation (EU) 2023/1525 on 20 July 2023.2 The ASAP is an important component of a wide-ranging EU response to the war in Ukraine, which began when Russia illegally invaded its sovereign neighbor in February 2022. The core purpose of the ASAP is to promote through ad hoc EU funding the rump up of production capabilities of the EU defense industry, thus supporting Ukraine on the battlefield, by providing it with a significant amount of ground-to-ground and artillery ammunitions, as well as missiles. Given the amount of shells which are shot daily by Ukraine and its opponent, in the most high-intensity military conflict in the European continent since the end of World War II (WWII),3 a particular urgency surrounds this new EU defense production effort. Hence the acronym of the new regulation, which reveals the EU’s ambition to replenish the Ukrainian stockpiles -- as soon as possible. 3 See Erlanger, “Ukraine Needs Shells, and Arms Makers Want Money. Enter the E.U.”, The New York Times, 8 March 2023 https://www.nytimes.com/2023/03/08/world/europe/ukraine-eu-shells-ammunition.html 2 Regulation (EU) 2023/1525 of the European Parliament and of the Council of 20 July 2023 on supporting ammunition production (ASAP), OJ 2023 L 185/7 [hereinafter ASAP regulation]. 1* A revised and updated version of this paper is forthcoming in I. Govaere, S. Garben & E. Spaventa (eds), The Impact of the War (in Ukraine) on the EU (Hart Publishing, Oxford, 2025) The purpose of this chapter is to examine the ASAP, as adopted by the EU co-legislator, but also to reflect more broadly at its implications for the EU defense capabilities. The ASAP, in fact, is the latest piece of the puzzle of an ever more comprehensive EU response to the return of war on the European continent.4 As a growing body of literature has pointed out, the war in Ukraine has profoundly transformed the EU, leading to unprecedented advances in the field of Common Foreign and Security Policy (CFSP), Common Security and Defense Policy (CSDP)5 -- but also energy, with the phasing out of Russian fossil fuels, and asylum and migration, with the first ever deployment of the Temporary Protection Directive.6 Moreover, in response to the war the EU has rolled out several new financial instruments to provide support to the Ukrainian government and military, which largely tracked the use of common debt experimented in response to Covid-19.7 At the same time, the war in Ukraine, has also led the EU to revive its enlargement process, by granting candidate status to, and starting accession negotiation with, Ukraine (and Moldova);8 and by setting up a new forum -- the European Political Community -- to deepen relations with the wider Europe.9 Yet, the war in Ukraine has also impacted on the EU industrial policy strategy, leading to a rethink of the role of public intervention in the economy in pursuance of geo-strategic priorities.10 In fact, the ASAP is closely connected to a European Defense Industry Reinforcement through common Procurement Act (EDIRPA), which has also been approved by the EP and the Council of the EU in early summer 2023.11 Moreover, the ASAP relates to other recent legislative priorities of the European Commission, including the Chips Act, and the Critical Raw Materials Act, which have all been designed to increase the resilience of EU supply chains, to reduce foreign dependences, and to adjust to the reality of the new, selective, globalization.12 Along the lines of this new European economic security strategy,13 the ASAP regulation endeavors to support the capacity of the EU defense industry to live up to the challenges posed by the war in Ukraine, while also positioning the EU to address in a supranational way a more threatening geo-strategic environment. From this point of view, 13 See European Commission & High Representative, ‘European economic security strategy’, 20 June 2023, JOIN(2023) 20 final. 12 See H James, ‘The new globalization and the economic consequences of Brexit’ in F Fabbrini (ed), The Law & Politics of Brexit. Volume V. The Trade & Cooperation Agreement (Oxford University Press 2024) 29. 11 Regulation (EU) 2023/2418 of the European Parliament and of the Council of 18 October 2023 on establishing an instrument for the reinforcement of the European defence industry through common procurement (EDIRPA), OJ 2023 L 1. 10 See Editorial Comments, ‘Paying for the EU’s Industry Policy’, (2023) 60 CMLRev. 617. 9 See also Luigi Lonardo, “The European Political Community: A Nebulous Answer to the Strategic Question of How to Unite Europe” (2023) 8 European Papers 755. 8 See R Petrov and C Hillion, Guest Editorial, “‘Accession through War’ -- Ukraine’s road to the EU”, (2022) 59 CMLRev. 1289. 7 See F Fabbrini, ‘Funding the War in Ukraine: the European Peace Facility, the Macro-Financial Assistance Instrument and the Slow Rise of an EU Fiscal Capacity’ (2023)10 Politics & Governance 52. 6 See F Fabbrini, ‘“To Establish Justice”: The EU Response to the War in Ukraine in the Field of Justice and Home Affairs’ (2024) 49 ELR 359. 5 See S Blockmans, Editorial, ‘The Birth of a Geopolitical EU’, (2022) 27 EFAR 155. 4 This chapter builds on F Fabbrini, ‘European Defense Union ASAP’ (2024) 29 EFAR. On the topic addressed in this chapter see also, more extensively F Fabbrini, The EU Constitution in Time of War: Legal Responses to Russia’s Aggression of Ukraine (Oxford University Press 2024). therefore, the ASAP is a step in the direction of establishing a European defense union, seen both as a combination of military capability and industrial capacity. Nevertheless, as this chapter maintains, the ASAP cannot be equated to the EU equivalent of the United States (US) Defense Production Act.14 To begin with, the funding for ASAP charged on the EU budget is remarkably limited – only €500 million for two years. Moreover, the final ASAP regulation has dropped some of the ambitions of the original Commission proposal, including the power to compel private companies to produce by priority specific defense equipment -- a hallmark of the US Defense Production Act. Otherwise, the ASAP is affected by some broader structural limitations of the EU’s power in CFSP, CSDP, industry policy and fiscal resources. While the EU itself is a peace project -- created to prevent war in the European continent15 -- the war in Ukraine has arguably reinvigorated the leading role of the North Atlantic Treaty Organization (NATO) as the primary security architecture for the European continent. In this framework therefore ASAP constitutes a step towards strengthening the EU defense union. However, if the EU wants to be serious about its defense, given the ongoing conflict and the uncertainties about future US commitment, new EU law and policy initiatives would be much needed. As such, this chapter is structured as follows. Section 2 lays out the context of the ASAP regulation, explaining the political and military background to its adoption. Section 3 examines the content of regulation (EU) 2023/1525 detailing its main features. Section 4 discusses the consequences of ASAP, assessing the choice of legal basis and its significance for the role of the EU in defense industrial policy. Section 5, however, critically considers a number of weaknesses of the ASAP, particularly compared to the original Commission proposal, and highlights the unsettled status of the EU defense union. Section 6, finally, concludes. 2. The Context The outburst of the war in Ukraine on 24 February 2022 was a shock for the EU and its member states. The return of land warfare on the European continent for the first time since the end of WWII shattered expectations of a perpetual peace, and forced the EU to face the reality of hard power.16 Since the Russian illegal military aggression of Ukraine, however, the EU has responded in unprecedented ways -- with European integration in security, defense and beyond advancing more in the months since the beginning of the war than it had during the prior three decades. As leaders of the EU institutions and Heads of state and government of the 27 member states acknowledged in a special summit organized by the French Presidency of the Council of the EU in Versailles on 11 March 2022, “Russia’s war of aggression constitutes a tectonic shift in European history.”17 To face this changing geo-political scenario, therefore, the EU “decided to take more responsibility for our security and take further more decisive steps towards building our European sovereignty”18 -- along 18 Ibid para 7. 17 Informal meeting of the Heads of State or Government, Versailles Declaration, 10-11 March 2022, para 6. 16 Statement by the HR/VP Josep Borrell, EEAS, 27 February 2022. 15 See Eilstrup-Sangiovanni and D Verdier, ‘European Integration as a Solution to War’ (2005), 11 European Journal of International Relations 99. 14 Defense Production Act of 1950 (Pub. L. 81–774). three key dimensions, namely: “a) bolstering our defense capabilities; b) reducing our energy dependencies; and c) building a more robust economic base.”19 In the field of CFSP/CSDP, in particular, the EU rolled out a series of groundbreaking measures. To begin with, the EU approved a strategic compass designed to outline a united foreign policy and security strategy,20 and deepened its partnership with NATO.21 Moreover, between February 2022 and June 2024 the EU approved 14 rounds of sanctions designed to financially target President Vladimir Putin and his inner circle of oligarchs, politically deter Russia, and economically weaken its ability to continue the illegal war of aggression. At the same time, the EU decided for the first time ever to mobilize the European Peace Facility (EPF)22 -- a novel financial instrument established in connection with the new EU multi-annual budget -- to provide financial support to the Ukrainian military, including funding for the purchase of lethal weapons. Furthermore, the EU also activated a Military Assistance Mission, with the aim to train Ukrainian army officers to the use of advanced weapons.23 In particular, as the conflict in Ukraine continued, the EPF emerged as a leading tool in the EU defense strategy. In February 2022, the Council quickly approved a Decision on assistance measure for the supply to the Ukrainian armed forces of military equipment.24 The Decision empowered the High Representative of the EU for Foreign Affairs and Security to implement the measure,25 making arrangements with the beneficiary, including ensuring compliance with international human rights law and humanitarian law,26 and foresaw a disbursement of €450 million.27 This amount was subsequently doubled in March 2022,28 and tripled in April 2022 to a total of €1.5 billion.29 Subsequently, EPF funding to support to the Ukrainian military were further tapped in May 2022,30 and July 2022,31 bringing the total size 31 See Council Decision (CFSP) 2022/1285 of 21 July 2022 amending Decision (CFSP) 2022/338 on an assistance measure under the European Peace Facility for the supply to the Ukrainian Armed Forces of military equipment, and platforms, designed to deliver lethal force, OJ 2022 L 195/93. 30 See Council Decision (CFSP) 2022/809 of 23 May 2022 amending Decision (CFSP) 2022/338 on an assistance measure under the European Peace Facility for the supply to the Ukrainian Armed Forces of military equipment, and platforms, designed to deliver lethal force, OJ 2022 L 145/40. 29 See Council Decision (CFSP) 2022/636 of 13 April 2022 amending Decision (CFSP) 2022/338 on an assistance measure under the European Peace Facility for the supply to the Ukrainian Armed Forces of military equipment, and platforms, designed to deliver lethal force, OJ 2022 L 117/34. 28 See Council Decision (CFSP) 2022/471 of 23 March 2022 amending Decision (CFSP) 2022/338 of an assistance measure under the European Peace Facility for the supply to the Ukrainian Armed Forces of military equipment and platforms designed to deliver lethal force, OJ 2022 L 96/43. 27 Ibid., Article 2. 26 Ibid., Article 3. 25 Ibid., Article 4. 24 See Council Decision (CFSP) 2022/338 of 28 February 2022 on an assistance measure under the European Peace Facility for the supply to the Ukrainian Armed Forces of military equipment and platforms designed to deliver lethal force, OJ 2022 L 60/1. 23 Council Decision (CFSP) 2022/2245 of 14 November 2022 on an assistance measure under the European Peace Facility to support the Ukrainian Armed Forces trained by the European Union Military Assistance Mission in support of Ukraine with military equipment, and platforms, designed to deliver lethal force, OJ 2022 L 294/25. 22 Council Decision (CFSP) 2021/509 of 22 March 2021 establishing a European Peace Facility and repealing Decision (CFSP) 2015/528, OJ 2021 L 102/14 [hereinafter EPF Decision]. 21 See also Joint Declaration on EU-NATO Cooperation, 10 January 2023. 20 See Council of the EU, ‘A strategic compass for security and defense - For a European Union that protects its citizens, values and interests and contributes to international peace and security’, 21 March 2022, Doc. 7371/22. 19 Ibid. of support to €3.1 billion. This, combined with other EPF expenditures towards other third countries carried out in 2022, largely depleted in a single year a budget that had been designed for a seven-year time-frame. As a result, the Council decided in December 2022 for a €2 billion increase in the EPF for 2023,32 and in June 2023, the Council agreed to a further €3.5 billion top-up of the EPF, increasing its size to €12 billon.33 Yet, the continuation of the war and the need to fund the Ukrainian army in its defense against the Russian aggression forced a further re-organization of the EPF. Following a request by the European Council in December 2023,34 the Council agreed in March 2024 to increase the envelope of the EPF by a further €5 billion, ringfencing this new amount for Ukraine only, via a so-called Ukraine Assistance Fund (UAF).35 Moreover, the Council decided to improve the governance arrangements for the implementation of the UAF, tasking the FC to decide on the disbursement of this amount within a month.36 At the same time, the Council agreed to limit after a transition period the ability of member states to obtain reimbursement from the EPF for the national deliveries of ammunition from stocks to Ukraine,37 thus promoting joint procurement of new weapons. The latest increase of the EPF – which brings it to a total of over €17 billion, more than three times more the original EPF funding of €5.6 billion – constitutes a significant increase. However, the Council acknowledged that “further comparable annual increases could be envisaged until 2027, based on Ukrainian needs.”38 Nevertheless, the war quickly exposed also the limited military capabilities and dwindling arsenals of the EU member states -- a process caused by two interrelated factors. On the one hand, under the post-Cold War peace dividend, member states had consistently reduced their defense spending. In fact, this had long been a matter of complaint by the US: while in 2014, following Russia’s illegal invasion and annexation of Crimea, NATO had set a target of 2% of gdp national defense spending on the military,39 European countries had largely failed to abide by this rule.40 On the other hand, uncoordinated national military expenditures had led to duplication and waste -- a dynamic often called the costs of non-Europe in defense.41 To address this state of affairs, as requested by the Versailles Declaration,42 on 18 May 2022 the European Commission and High Representative published a joint whitepaper on defense investment gap and way forward, where they outlined options 42 Versailles Declaration (n _) para 11. 41 See B Ballester, ‘The Cost of Non-Europe in Common Security and Defense Policy’ (2013) European Parliament Research Service. 40 See F Fabbrini, ‘Do NATO Obligations Trump European Budgetary Constraints?’ (2018) 9 Harvard National Security Journal 121. 39 See Summit Declaration Issued by the Heads of State and Government Participating in the Meeting of the North Atlantic Council in Wales, 5 September 2014, para 14. 38 Ibid recital 15. 37 Ibid recital 10. 36 Council Decision (CFSP) 2024/890 of 18 March 2024 amending Decision (CFSP) 2021/509 establishing a European Peace Facility, OJ 2024 L 1/4, art 1. 35 Council of the EU press release, “Ukraine Assistance Fund: Council allocates €5 billion under the European Peace Facility to support Ukraine militarily”, 18 March 2024. 34 European Council conclusions 14-15 December 2023, EUCO 20/23, para 3. 33 Council of the EU press release, “European Peace Facility: Council agrees on second top-up of the overall financial ceiling by 3.5 billion”, 26 June 2023. 32 Council Decision (CFSP) 2023/577 of 13 March 2023 amending Decision (CFSP) 2021/509 establishing a European Peace Facility, OJ 2023 L 75/23. to incentivize joint procurement of military equipment.43 Building on this policy document, on 19 July 2022 the Commission put forward a legislative proposal for an EDIRPA.44 This short-term instrument, which had its legal basis in Article 173 TFEU, on industrial policy, was specifically designed to incentivize the EU member states to procure defence products jointly, addressing the EU’s most urgent and critical defence capability gaps and developing the EU Defence Technological & Industrial Base (EDTIB). To this end, the Commission proposed for EDIRPA a dedicated financial envelope of €500 million, to be drawn down from the EU budget. The EDIRPA regulation was ultimately approved by the EP and the Council in October 2023, but with a smaller budget of €300 million for the period until 31 December 2025. As the war increasingly turned into a high-intensity conflict of attrition, however, a specific need emerged to supply the Ukrainian army on the battlefield with ammunition. On 20 March 2023, therefore, the Council of the EU approved a plan in three steps to secure the delivery and joint procurement of ammunition for Ukraine.45 First, “[t]he Council call[ed] on Member States to urgently deliver ground-to-ground and artillery ammunition to Ukraine and, if requested, missiles”46 Second, “The Council further call[ed] on Member States to jointly procure 155mm ammunition and, if requested, missiles for Ukraine in the fastest way possible before 30 September 2023”47 Third, and finally, “The Council invite[d] the Commission to present concrete proposals to urgently support the ramp-up of manufacturing capacities of the European defence industry, secure supply chains, facilitate efficient procurement procedures, address shortfalls in production capacities and promote investments, including, where appropriate, mobilising the Union budget.”48 On this basis, on 3 May 2023 the Commission put forward a proposal for an ASAP regulation,49 as a complement to the EDIRPA. The ASAP – which has as its legal bases Article 173 TFEU on industrial policy, and Article 114 TFEU on internal market – was approved by the co-legislators at record speed, indeed much faster than the EDIRPA, and entered into force in July 2023, with a envelop of €500 million, funded from the EU budget, for the period from 25 July 2023 until 30 June 2025 3. The Content The ASAP regulation is a relatively lean piece of EU legislation, comprising 24 articles, structured in five chapters. The preamble to the regulation recalls the historical setting in which ASAP was put forward, including the outburst of the war in Ukraine and the 49 European Commission proposal for a Regulation of the European Parliament and of the Council on establishing the Act in Support of Ammunition Production, 3 May 2023, COM(2023) 237 final. 48 Ibid para 4. 47 Ibid para 3. 46 Ibid para 2. 45 Council of the EU, Doc. 7632/23, Annex: Speeding up the delivery and joint procurement of ammunition for Ukraine, 20 March 2023. 44 See European Commission proposal for a Regulation of the European Parliament and of the Council on establishing the European defense industry Reinforcement through common procurement Act, 19 July 2022, COM(2022) 349 final. 43 See European Commission and High Representative Joint Communication on Defense Investment Gap Analysis and Way Forward, 18 May 2022, JOIN(2022)24 final, p 9-10. consequential decision taken by Heads of state and government in the Versailles summit of 11 March 2022 to “take further decisive steps towards building European sovereignty.”50 The preamble also explain the rationale for the adoption of the ASAP, namely Ukraine’s pressing defense need of ground-to-ground and artillery ammunitions and missiles and the urgency to increase the production to replenish depleting national stocks.51 The preamble furthermore highlights “the specificities of the defense industry, where demand comes almost exclusively from Member States,”52 clarifying that “the functioning of the defence industry sector does not follow the conventional rules and business models that govern more traditional markets.”53 As such, the ASAP emphasizes how “additional [EU] industrial policy measures are necessary to ensure a rapid ramp-up of manufacturing capacities”54 and stresses that EU “defense industry is a crucial contribution to the resilience and the security of the [EU].”55 Article 1 of regulation states that the purpose of the ASAP is to “establish[] a set of measures and lay[] down a budget aimed at urgently strengthening the responsiveness and ability of the [EDTIB] to ensure the timely availability and supply of [...] relevant defence products.” This overall purpose is further teased out in Article 4, which clarifies that: “The objective of the Instrument is to foster the efficiency and competitiveness of the [EDTIB] to support the ramp-up of the production capacity and timely delivery of relevant defence products through industrial reinforcement.” To this end, Article 5 sets aside a budget of €500 million in current prices, “for the period 25 July 2023 to 30 June 2025.” Indeed, as indicated in Article 24(2), “[t]his Regulation shall apply until 30 June 2025” -- hence with a sunset. Nevertheless, pursuant to Articles 1(2) and 23, “[b]y 30 June 2024, the Commission shall draw up a report evaluating the implementation of the measures set out in this Regulation and their results, as well as the opportunity to extend their applicability and provide for their funding”56 -- hence leaving open the door to extend and expand the instrument’s funding. Moreover, as stated in Article 6, ASAP funding “shall be implemented in synergy with other [EU] programmes”, with the consequence that an action receiving funding under this regulation may also get support from other EU funding schemes, provided alternative contributions do not cover the same costs. The substantive core of ASAP is enshrined in Article 8. This provision clarifies the eligible actions to be funded, and states that “[t]he Instrument shall provide financial support for actions addressing identified bottlenecks in production capacities and supply chains with a view to securing and accelerating the production of relevant defence products in order to ensure their effective supply and timely availability.”57 The provision, in particular, lists a number of defense production activities, including the optimisation, expansion, modernisation, upgrading or repurposing of existing, or the establishment of new, production capacities, in relation to relevant defence products; the establishment of cross-border industrial partnerships; the testing and reconditioning of defense products; and the training, 57 Ibid Article 8(2). 56 Ibid Article 23(1). 55 Ibid recital 34. 54 Ibid recital 6. 53 Ibid. 52 Ibid recital 20. 51 Ibid recital 4. 50 ASAP Regulation, recital 2. reskilling or upskilling of personnel. At the same time, Article 8(4) prohibits funder under ASAP for “actions related to the production of goods or delivery of services which are prohibited by applicable international law; [and] actions related to the production of lethal autonomous weapons.” From this point of view, for example, the ASAP could not be used to produce cluster munitions, which the US controversially decided to provide to Ukraine at its request,58 but which are banned by an international convention.59 From a management viewpoint, the regulation empowers the Commission to lay out a work-program,60 and directly award ASAP funding to relevant defense industries, based on their applications. According to Article 11(2), the “Commission shall, by means of implementing acts, award the funding under this Regulation.” Pursuant to Article 10(1) eligible entities include “public or privately owned [companies], which are established and have their executive management structures in the [EU] or in an associated country.” In fact, as stated in Article 3, ASAP is open also to members of the European Economic Area -- basically Norway. As clarified in Article 11 the award of funding depends on several criteria, including: increase in production capacity in the EU; reduction of lead production time; elimination of sourcing and production bottlenecks; and resilience through cross-border cooperation. As stated in Article 9, the financing rate offered by the EU can fund “up to 35 % of the eligible costs of an eligible action related to the production capacities of relevant defence products, and up to 40 % of the eligible costs of an eligible action related to the production capacities of components and raw materials insofar as they are intended or used wholly for the production of relevant defence products”. However, this percentage can increase further “where applicants demonstrate a contribution to the creation of new cross-border cooperation” or “where applicants commit to prioritising, for the duration of the action, orders stemming from [...] the common procurement of relevant defence products by at least three Member States; [or] the procurement of relevant defence products [... for] Ukraine.”61 Moreover, the regulation introduces further special provision to secure the security of supply. To ensure the timely availability of relevant defence products, Article 13 encourages member states to accelerate the permit granting process related to the planning, construction and operation of production facilities, transfer of inputs within the EU as well as qualification and certification of end products. To facilitate common procurement during the ammunition supply crisis, Article 14 of the regulation introduces a derogation to Directive 2009/81/EC on defense procurement,62 allowing at least two EU member states to modify existing framework agreements to increase production. At the same time, “to leverage, de-risk and speed-up investments needed to increase manufacturing capacities” Article 15 authorizes the establishment of a rump-up fund, which the Commission will manage.63 The regulation then 63 ASAP regulation, Article 7(1). 62 Directive 2009/81/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of procedures for the award of certain works contracts, supply contracts and service contracts by contracting authorities or entities in the fields of defence and security, and amending Directives 2004/17/EC and 2004/18/EC, OJ 2009 L 216/76. 61 Ibid Article 9(2). 60 ASAP regulation, Article 12. 59 Convention on Cluster Munitions (CCM) 58 « Pourquoi la livraison d’armes à sous-munitions à l’Ukraine annoncée par Washington est controversée », Le Monde, 7 July 2023. EU reached only “one third of the objective, mainly taken from our stockpiles.”99 Hence, despite the best intentions, national jalousies and governance obstacles in the EU decision-making system removed from the ASAP regulation an empowerment in favour of the Commission, which would have been necessary to effectively prioritize defence production. In sum, the ASAP reflects how the EU foreign affairs and security policy remains a work-in-progress, and the challenges of developing a full-fledged EU defense union.100 In the aftermath of the Brexit referendum, the EU had taken a number of important steps to deepen defense cooperation, including the launch of the Permanent Structured Cooperation on Defense (PESCO),101 as allowed by Article 42(6) TEU; the authorization of the first PESCO operational projects;102 and the establishment of an operational planning and conduct capability infrastructure designed to oversee common security and defense policy missions and operations.103 Nevertheless, the EP had more ambitiously called for the creation of a real EU Defense Union, underpinned by strong and modern military capabilities.104 In fact, in the aftermath of the Russian invasion of Ukraine, the EP has called for a reinforcement of the EU capacity to act in a more challenging geo-political context,105 and underlined “the urgent need to establish a truly European defence equipment market”, with increased financial support from the EU budget.106 To get there, however, further steps are needed. Indeed, while the pandemic pushed the EU to develop a centralized fiscal capacity,107 in the form of NGEU, the war in Ukraine arguably has not yet led the EU to develop unified military capabilities. Rather, NATO has been strengthened as the preeminent organization for the security of Europe – a dynamic made evident by its enlargement to Finland and Sweden.108 From an international relations perspective, the decision by these two member states to abandon their military neutrality dwarfed in importance e.g. the decision by Denmark to renounce its output on CSDP.109 As a matter of fact, NATO is backed by the US military commitment – which makes the mutual defense clause of Article V NATO Treaty credible. At the moment, instead, no similar credibility underpins the EU’s mutual defense clause, Article 42(7) TEU – and this is precisely because of the lack of common EU military 109 See also High Representative/Vice-President Josep Borrell, statement on the outcome of the referendum on the opt-out in defence matters, 1 June 2022. 108 See C Bildt, “NATO’s Nordic Expansion”, Foreign Affairs, 26 April 2022. 107 F Fabbrini, EU Fiscal Capacity: Legal Integration after Covid-19 and the War in Ukraine (Oxford University Press 2022). 106 European Parliament resolution of 18 January 2023 on the implementation of the common security and defence policy – annual report 2022, P9_TA(2023)0010, para 34. 105 See European Parliament resolution of 19 May 2022 on the social and economic consequences for the EU of the Russian war in Ukraine -- reinforcing the EU’s capacity to act, P9_TA(2022)0219. 104 European Parliament Resolution of 22 November 2016 on the European Defense Union, P8_TA(2016)0435. 103 Council of the EU Conclusions, On Progress in Implementing the EU Global Strategy in the Area of Security and Defence, Annex – Concept Note: Operational Planning and Conduct Capabilities for CSDP Missions and Operations, 6 March 2017, Doc. 110/17. 102 Council Decision (CFSP) 2018/340 of 6 March 2018 establishing the list of projects to be developed under PESCO, OJ 2018 L65/24. 101 Council Decision (CFSP) 2017/2315 of 11 December 2017 Establishing Permanent Structured Cooperation (PESCO) and Determining the List of Participating Member States, OJ 2017 L 331/57. 100 See also R Wessel, ‘Common Foreign, Security and Defense Policy’, in R Wessel, J Larik (eds), EU External Relations Law (Hart Publishing, 2020). 99 High Representative/Vice-President Josep Borrell, press remarks, 31 January 2024. capabilities and deterrence. Yet, with the war in Ukraine showing no sign of abating, and with future uncertainties about the US commitment to European security,110 especially in view of the elections of 2024, the EU should move in the direction of a real defense union – asap.111 6. Conclusion This chapter has examined ASAP – a new regulation adopted by the EP and the Council to boost the production and procurement of ammunitions and missiles with the aim to support Ukraine in the war against Russia. ASAP is the latest piece in a wide-ranging EU response to the war in Ukraine, and pushes the EU into a new terrain, that of industrial defense policy. In particular, through a constructive use of supranational legal bases in the Treaties, ASAP has attributed to the Commission the authority to use resources from the EU budget to fund the industrial production of ammunitions and missiles urgently needed by Ukraine, thus helping to strengthen the EU’s role in developing common defense capabilities. Yet, the EU’s involvement in the military industrial complex remains limited, as ASAP suffers from a number of weaknesses, including a very tiny €500 million bi-annual budget. Moreover, contrary to the original Commission proposal, the co-legislator have ditched the power for the Commission to issue priority rated order, compelling defense industries to produce specific defense goods on demand. From this point of view, therefore, ASAP cannot be regarded as the EU’s equivalent of the US Defense Production Act, a landmark piece of legislation which gives wide authority to the US executive to command the production of materiel needed for the national defense. This state of affairs is hardly surprising, considering the constraints on the EU defense policy. Nevertheless, this state of affairs is at odds with the declared EU aspirations to establish a form of European sovereignty, and may be unsustainable in light of the ongoing war in Ukraine, and uncertainties about future US commitment. Beyond ASAP, the EU therefore needs a defense union – asap. 111 See further Federico Fabbrini, “Activating the Law Creatively to Integrate Defence in Europe”. 110 K Engelbrekt, ‘Beyond Burdensharing and European Strategic Autonomy: Rebuilding Transatlantic Security after the Ukraine War’ (2022) 27 EFAR 383