EU: Ambassadors Approve E150B SAFE Loans, Moves To Ministerial Sign-Off

As noted earlier, member state permanent representatives to the EU have approved the plan E150B Security Action For Europe (SAFE) loans, which is a pillar of the European Commission's ReArm Europe programme intended to allow member states to bolster their armed forces and defence capabilities. EU Affairs ministers will now need to give final signed off at the General Affairs Council meeting on 27 May, which is seen largely as a formality. Politico reports "Two of the diplomats said that Hungary abstained, but since the regulation was adopted with qualified majority Budapest wasn't able to block the initiative."

• The Commission faces the prospect of being sued by the European Parliament for using Art. 122 of the TFEU to bypass a vote among MEPs on the loans. The clause has previously been used in response to the COVID-19 pandemic and in the immediate aftermath of Russia's full-scale invasion of Ukraine, but the Parliament's Judiciary Committee ruled this utilisation was unjustified.
• In line with MNI's reporting from 15 May, Politico claims that the final draft of SAFE text "also makes the participation of non-member subcontractors easier. It now says that "common procurement involving subcontractors" that are allocated between 15 percent and 35 percent of the value of the contract and "that are not established or don’t have their executive management structures" in the EU, or in one of its partners like Norway and Ukraine, "should be eligible." A separate EU-UK agreement will be required allow British firms to participate.