European Defence Fund 2025: Key Conditions and Features

Main Objectives and Features

The European Defence Fund (EDF) aims to enhance the competitiveness, efficiency, and innovation of the European defence industry. It supports collaborative actions and cross-border cooperation among companies and research organizations within the EU. By funding joint defence research and development projects through lump sum or actual cost grants, the EDF seeks to boost the EU's strategic autonomy and address both traditional and emerging security threats.

Project Budget 

Each call for proposals has an allocated budget, which is divided among various topics and action categories. Topic budgets range from EUR 2 mln to EUR 79 mln.

Thematic Categories of Activities and Indicative Budget Allocation (in million euros)

Defence Medical Response, CBRN, Biotech, and Human Factors  35 mln. EUR
Information Superiority (C4ISR)  39 mln. EUR
Advanced Passive and Active Sensors 58.5 mln. EUR
Cyber Defence  54 mln. EUR
Space Capabilities  115 mln. EUR
Digital Transformation 27 mln. EUR
Energy Resilience and Environmental Transition 93 mln. EUR
Materials and Components 25 mln. EUR
Air Combat 103 mln. EUR
Ground Combat 192 mln. EUR
Force Protection and Mobility 35 mln. EUR
Naval Combat  54 mln. EUR
Underwater Warfare 45 mln. EUR
Simulation and Training 43 mln. EUR
Disruptive Technologies  43 mln. EUR
Non-thematic Calls for SMEs and Research Organisations  67 mln. EUR
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Eligible applicants:

  • Small and Medium-sized Enterprises (SMEs)
  • Research Organisations
  • Larger Defence Industry Players
  • Entities from EU Member States and Associated Countries
  • Entities from Ukraine (as third parties for a limited number of calls for proposals) 
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Funding rates

Research Actions: 100% of eligible costs.

Development Actions: Baseline funding rates vary from 20% to 90% of eligible costs, with potential bonuses for projects under the Permanent Structured Cooperation (PESCO), SME involvement, and mid-cap participation

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Consortium Requirements

Consortia must include at least three eligible legal entities from at least three different EU Member States or Associated Countries. For projects focusing on disruptive technologies, smaller consortia (with at least two entities from EU Member States or Associated Countries) are permitted.

Ukrainian entities are now eligible to participate as third parties, recognizing their valuable battlefield experience and potential contributions to the European defence technological and industrial base.

Eligible Activities (distributed according to the type of activity - research actions and development actions) 

  1. Generating knowledge
  2. Integrating knowledge 
  3. Studies, such as feasibility studies
  4. Design
  5. System prototyping 
  6. Testing 
  7. Qualification
  8. Certification 
  9. Increasing efficiency
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Expected deadline for submission: 16 October 2025 

Orlin Hadjiiski

Partner, Tax & Legal Services, PwC Bulgaria

Email

Nikolay Ilchev

Partner, Tax Services, PwC Bulgaria

+ 359 894 332 921

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