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French officials have proposed an initiative to limit the use of British-made defense equipment in the European Union's €150bn defence program, a move that could hinder talks over Britain’s involvement in the scheme.

Proposed Fifty Percent Limit on UK Content

Per officials, France has suggested a 50% ceiling on the value of British components in initiatives financed through the European Union’s SAFE program.

This €150bn loans scheme is part of the EU’s wider effort to increase defence spending and strengthen continental security resources.

British-European Security Partnership

In May, UK Prime Minister Keir Starmer and European Commission President the Commission’s head agreed to a landmark security and defence agreement, enabling greater British involvement in EU military projects.

Without this agreement, the UK would have been limited to providing no more than 35% of the value of components in any SAFE-funded initiative.

Current Negotiations and Potential Challenges

However, the UK must still finalize a detailed arrangement to secure a more significant part for its military industry, and the European Union may set additional restrictions on British participation.

Moreover, the UK government must negotiate a cost to participate in the scheme.

Such suggested limits on British contributions were raised during internal meetings as European countries draft a negotiating mandate for the EU executive before negotiations with the British leadership.

Member State Reactions

The vast majority of member states are said to oppose restrictions on UK participation, favoring flexibility in military acquisitions.

One European official described the suggested fifty percent limit as a “typical French fixation.”

Paris has long advocated for a European defence industry that is independent from the United States, and has argued that post-Brexit, the UK should not benefit from the bloc’s internal market privileges.

UK Aims and Benefits

The UK does not intend to request loans from the scheme—which are reserved for EU member states—but hopes that British defence companies will profit from the investment surge.

A official deal to join the program would make it simpler for British companies to participate in defence production networks, supplying gear ranging from small drones and munitions to sophisticated artillery systems with deep strike abilities.

Official Comments

“We support the European Commission in its efforts to establish the terms for the Britain’s association with the program. Foundation for this is laid out by the SAFE regulation, which state that some of components must come from the European industry.”

— Spokesperson, French Diplomatic Mission

“Britain is an essential partner for the EU. We share many common interests, thus our will to conclude a mutually beneficial agreement to fully integrate them with our defence instrument.”

— Thomas Regnier, EU Executive

Future Proceedings

Britain must also negotiate a fee to enter the scheme, which is intended to cover operational costs.

European diplomats are set to review UK accession to SAFE this week, along with a similar proposal for Canada, which lately signed its own security pact with the EU.

Latest Participating Countries

EU authorities announced that 19 member states will receive program loans.

• The Polish government is receiving the biggest amount of €43.7bn.
• The French state and Hungary will each obtain €16.2 billion.
• The Romanian leadership is set to access €16.7bn.
• Italy will take €14.9bn.

The EU-backed loans reduce interest rates for several countries and can be allocated for equipping national armies or supporting Ukraine.