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US President Donald Trump's administration has threatened to retaliate against European countries if the European Union decides to favor domestic arms manufacturers as part of efforts to rearm the continent.
The US Department of Defense opposed any changes to European rules that would limit US companies' access to the EU defense market and stressed that such a step would bring a response from Washington.
"The United States strongly opposes any changes to the Directive that would limit the ability of U.S. industry to support or participate in national defense procurements of EU member states," the U.S. administration document states.
The administration adds that " Protectionist and exclusionary policies that force American companies out of the market, when the largest defense firms in Europe continue to benefit greatly from market access in the United States, are the wrong course of action."
Washington's stance highlights a tension in transatlantic relations: while the Trump administration has repeatedly called on European countries to take more responsibility for the continent's defense, it opposes this process harming the interests of the American defense industry.
POLITICO previously reported that Deputy Secretary of State Christopher Landau criticized European NATO allies during a closed-door meeting in December for favoring domestic industry over American suppliers. The State Department co-signed the administration’s contribution to the Commission’s consultation.
For several years, the European Commission has been trying to increase the share of European products in the bloc's arsenals and procurement contracts, as part of preparations for a possible conflict with Russia. Currently, almost two-thirds of the EU's imported weapons come from the United States, including F-35 fighter jets, HIMARS systems and Patriot air defenses.
The Trump administration's strong opposition could complicate the Commission's efforts to promote broader industrial policies with a "Buy European" orientation. This situation is expected to test the willingness of member states to reduce dependence on the US in the field of defense.
The European Commission is expected to present an update of the 2009 Directive in the third quarter of this year. It is not yet clear whether the new text will include binding rules to favor domestic producers.
The EU already applies criteria that favor European industry in several programs, such as the €150 billion SAFE instrument for arms loans and the €90 billion loan for Ukraine. Under current rules, EU funds can only be used for purchases if at least 65 percent of the value of the equipment is of European origin.
In its contribution, the Pentagon warns that the inclusion of a strong "Buy European" clause would lead to a review of exemptions from US "Buy American" laws, provided for under the Reciprocal Defense Procurement Agreements.
This would mean limiting European companies' access to the US defense market. Currently, 19 of the 27 EU member states have such agreements with the US, which allow European firms to compete for some Pentagon contracts.
According to the US administration, any future exemptions will be considered on a case-by-case basis and only when deemed necessary for interoperability and standardization within NATO.
Washington argues that a mandatory European preference clause would limit member states' freedom, weaken NATO and jeopardize the alliance's capability goals. The administration also points out that such a step would run counter to commitments made in last summer's US-EU trade deal, where the Commission pledged to increase purchases of American weapons.
"The language of European preference is already featured in all EU programs, but its inclusion in the Directive would be a turning point in the impact on the sovereign and national budgets of individual member states ," the Trump administration document states.
The Pentagon and State Department's stance also found support from the American Chamber of Commerce, which in its contribution warned against including a mandatory European preference in the new legislation./ Politico
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