Preparing for European Defence Industry Grants 2026: Why You Should Start Now?
The European defence industry is undergoing a transformation faster than ever before during the 2021–2027 period.
The Russia-Ukraine war, supply chain vulnerabilities, and discussions about strategic dependence on the US have pushed the EU towards a more integrated, more autonomous, and more aggressive funding model in defence.
At the heart of this transformation, the year 2026 stands out as a turning point. Because 2026 will be the year when the European Defence Fund (EDF) calls mature, new tools such as the European Defence Industrial Strategy (EDIS) and European Defence Industrial Programme (EDIP) are implemented, and the first pre-financing payments for major flagship projects are made.
For companies producing defence, aerospace, advanced manufacturing, artificial intelligence, autonomous systems, cybersecurity, space, and dual-use technologies, this means intense competition even more than Horizon Europe, but with the right strategy, it also means much larger budget grants.
EU Defence Industry Ecosystem: The Big Picture Towards 2026
During the 2021–2027 multiannual budget period, the backbone of EU defence industry policy consists of the following tools:
- European Defence Fund (EDF) – Defence R&D and development grants
- ASAP – Temporary tools focused on accelerating ammunition production
- EDIRPA / EDIS-like transition programmes – Structures supporting joint procurement and stockpiling phases
- EDIP (European Defence Industrial Programme) – New programme focused on industrial production capacity
- European Defence Industrial Strategy (EDIS) – A framework connecting all these tools into a uniform strategy
The core objectives of EDIS aim to radically rebalance the defence market by 2030:
- To raise intra-EU defence trade to at least 35% of the EU defence market
- To ensure that at least 50% of member states’ defence procurements come from the EU defence industry (EDTIB)
- To procure at least 40% of defence equipment collaboratively
These objectives will strengthen the following three trends in grants distributed from 2026 onwards:
- Positive discrimination for those with intra-EU supply chains
- Higher grant rates for joint (multinational) projects
- Less room for “singular R&D projects” that cannot evolve into series production and joint procurement
European Defence Fund (EDF): The EU’s Defence R&D Grant Engine
What is EDF and What Does it Fund?
The European Defence Fund (EDF) is the main financial tool supporting the EU’s defence R&D and development projects. It has a budget of approximately €7.95 billion for the 2021–2027 period and:
- Aims to increase the competitiveness, innovation capacity, and efficiency of the EU defence industry,
- Promotes joint defence projects among companies and research institutions from different member countries,
- Aims to facilitate the entry of SMEs into consortia and supply chains.
In practice, you can think of the EDF as the “defence R&D grant engine” that nourishes the EU’s defence technology ecosystem.
How Does EDF Work? Basic Rules
The EDF only funds transnational, multi-partner consortia. Typical requirements include:
- At least 3 participants from different member/associated countries (often a higher minimum number in many calls)
- Projects must be aligned with the defined “capability needs” of defence ministries or armed forces
- Significant SME and mid-cap participation (especially in subcontractor roles)
The financing logic also varies by phase:
- Research phase: Generally higher grant rates (often covering a large part of the cost with EU funding)
- Development / Demonstration: The co-financing ratio increases, and companies are expected to contribute significant capital to the project
All calls are detailed within the annual EDF Work Programme. The 2025 Programme has been published, and the final application was completed in October 2025. This means that the preparation period for the 2026 calls has begun.
EDF 2026 Cycle: Calendar, EDF Info Days 2026, and Preparation Process
The European Commission is formalizing the official preparation process for the 2026 calls with EDF Info Days 2026. The event will take place on March 10–11, 2026, in Brussels and will be held in a hybrid (physical + online) format.
According to the Commission’s announcement, the structure of EDF Info Days 2026 is as follows:
- Day 1: Presentations on EDF 2026 calls, priority areas, application rules, and evaluation criteria
- Day 2: Networking sessions, thematic pitches, and B2B matchmaking to form consortia
This table practically states:
- Companies that do not start looking for partners for joint ventures from the last quarter of 2025 will struggle to form consortia for the 2026 calls.
- The Info Days event in Brussels is a critical threshold for SMEs to reach the right prime contractors and major industrial players.
EU Defence Roadmap and Priorities for 2026–2030
The EU Commission has defined an accelerated timeline for defence industry projects with the Defence Roadmap, shaping the period from 2026 to 2030. This roadmap clarifies the areas that EDF and future EDIP funding will focus on.
Priority Areas to Stand Out in 2026
The roadmap groups the projects that need to be accelerated from 2026 onwards into nine main themes. These will emerge as “high priority” themes in the calls from 2026 and beyond:
- Air and missile defence systems – Layered air and missile defence systems, next-generation interceptors
- Drones and anti-drone systems – UAVs, swarm technologies, detection and destruction solutions
- Advanced artillery systems – High-precision, long-range artillery and rocket systems
- Munitions – Increasing production capacity for munitions and ammunition
- Information systems and artificial intelligence – AI systems for command-control, decision support, situational awareness
- Land, sea and air combat capabilities – Next-generation capabilities in land, sea, and air platforms
- Military mobility – Systems facilitating the rapid movement of military units and equipment within the EU
Even if not defence-focused; companies working in areas such as sensors, software, data analytics, autonomous navigation, and logistics optimization can be included in these priority headings with a dual-use perspective.
Flagship Initiatives and Target Dates for 2026
The Defence Roadmap also defines four major “flagship” European defence initiatives:
- European Drone Defence Initiative
- Eastern Flank Watch
- European Air Shield
- European Space Shield
The timeline for these initiatives makes 2026 particularly critical:
- For the anti-drone “wall” and Eastern Flank Watch, leaders aim for political approval by the end of 2025; the launch of both initiatives is planned for the first quarter of 2026 and to be fully operational by the end of 2027–2028.
- For the European Air Shield and European Space Shield, activation is expected in the second quarter of 2026 and acceleration of capacity development activities throughout 2026.
- Under the SAFE framework, the first pre-financing payments for these flagship projects are expected to be made by March 2026.
Conclusion: 2026 will be a year of high volumes of EU grants and pre-financing payments, especially in areas such as air & missile defence, space surveillance, drone/anti-drone solutions.
EDIS and EDIP: The New Framework for Industry Grants After 2026
European Defence Industrial Strategy (EDIS)
EDIS is a high-level strategy announced by the Commission in 2024, aiming to strengthen the EU defence industry in the long term. EDIS, currently in the negotiation phase with member states and the European Parliament, is expected to be adopted in 2025.
The main objectives of EDIS can be summarized as follows:
- To reduce fragmentation in the defence market and create common standards and certification processes
- To make joint production and joint procurement the norm
- To limit equipment dependency outside the EU – particularly on the US and other suppliers
- To grow the capacity of EDTIB (European Defence Technological and Industrial Base)
Thus, grants will prioritize not only projects that produce prototypes as a result of R&D but also industrial projects that can transition to series production and procurement.
European Defence Industrial Programme (EDIP)
At the center of EDIS is the European Defence Industrial Programme (EDIP), envisioned as the main financial tool for the future.
- Projected initial budget by 2027: €1.5 billion
- The working logic is similar to the R&D-focused EDF; however, it is focused on series production and joint procurement
The objectives of EDIP include:
- To provide financial incentives for joint production and joint procurement projects
- To increase the intra-EU procurement share of member states
- To establish a security of supply regime for defence equipment
This structure prepares for a much larger defence industry fund ecosystem for the 2028–2035 period. Projects that gain technological maturity with EDF in 2026–2027 will gain an advantage in transitioning to series production with EDIP.
Who Can Apply for the 2026 European Defence Grants?
EU defence funds are open not only to traditional arms manufacturers but also to a wide ecosystem of technology and services. Actors that may see opportunities in the 2026 process include:
- Defence and aerospace companies (platform manufacturers, system integrators)
- Electronics, software, artificial intelligence, cybersecurity and data analytics firms
- Advanced materials, sensors, optics, composite manufacturers
- Universities and research centers
- SMEs and startups (especially those developing dual-use and “disruptive” technologies)
In the EU funding logic, the inclusion of SMEs in consortia is both encouraged and often brings scoring advantages. Companies providing subsystems and niche technologies can view EDF calls as a “gateway” to enter the supply chains of major defence players.
Application Strategy: 5-Step Roadmap for 2026
To benefit from the 2026 EDF and related defence grants, companies must be prepared not only in terms of technology but also in terms of international structure and compliance. Key steps include:
1. Strategic Positioning
- Clarify which of your company’s products/services can align with the air & missile defence, drones/anti-drones, AI, munitions, military mobility axes highlighted in the Roadmap.
- If you are developing a dual-use technology, outline the defence use scenarios at the technical and business model level.
2. Consortia and Collaborations
- Start searching for potential partners for multi-partner consortia covering 3+ countries from the end of 2025.
- The networking sessions at EDF Info Days 2026 provide critical opportunities to meet the right prime contractors.
3. Corporate Structure and Compliance
- EU funds often operate through legal entities based in the EU. In many cases, incorporation in an EU member or associated country is a requirement to lead the project or play a key role.
- International personnel deployment, posted worker model, social security and tax obligations are monitored more closely and strictly in defence projects.
4. Financial and Tax Planning
- Even if the grant rate is high in EDF and future EDIP projects, there is a requirement for co-financing. Your company’s cash flow and investment plan must be structured according to long-term defence projects.
- Calculating costs for payroll/EOR, income tax, social security for personnel operating in multiple countries from the outset is critical for a solid budget structure in your proposal.
5. Preparing the Application File
- In addition to the technical narrative, focus on sections that reflect the EDIS/EDIP perspective, such as risk management, supply security, transition plan to series production.
- Illustrate the project’s contribution to EU strategic autonomy and its impact on strengthening the intra-EU supply chain.
Why is Corporate Structuring, Payroll, and Personnel Mobility Critical in This Process?
European defence projects, by their nature, require not only R&D but also operational, legal, and financial compliance. Especially in the post-2026 EDIS/EDIP period, corporate preparation becomes important in the following areas:
- Incorporation in the EU: Having a legal entity within the EU is often a competitive advantage and, in some cases, a practical necessity to become a consortium leader or prime contractor.
- International payroll and EOR (Employer of Record): For R&D and project teams working simultaneously in different EU countries, providing legal employment without establishing a company in each country is possible with payroll/EOR solutions.
- Posted worker model and tax optimization: Complying with posted worker rules for engineers and technicians sent to another EU country for a short/medium term provides significant savings and risk management in terms of both tax and social security.
- Residence and visa processes: Defence projects are often long-term; securing the mobility of key personnel in EU countries requires residence permits and, where necessary, solutions such as investment-based residence/golden visa.
Corpenza Perspective: Not Just Projects, But Infrastructure Also Wins in Defence Grants
As Corpenza, we specialize in incorporation, residence permits, international accounting, payroll (EOR), personnel leasing (posted worker model), and investment-based citizenship on a European and global scale.
In the context of defence industry grants, we can support you in structuring your corporate setup in the following areas beyond technical project writing:
- Establishing a company in the right EU country and related tax planning to enable you to lead EDF and future EDIP projects
- Setting up the payroll/EOR and international accounting infrastructure for project teams working in different EU countries
- Planning long-term mobility solutions such as residence permits, golden visas, and investment-based residence for R&D personnel and key managers
- Providing social security and tax optimization through the posted worker model, compliant with EU regulations for personnel deployment
Thus, your company prepares not only to win a project in the 2026 EDF call but also to become a permanent player in the European defence industry until 2030.
Conclusion: 2026 is Not Just a Call Year, But a Gateway to the Defence Ecosystem
The 2026 European defence industry grants are a stop on a long-term transformation shaped around EDF, Defence Roadmap, EDIS, and EDIP. Companies that win funding during this period will not only receive R&D grants but will also gain a permanent entry ticket to the European defence supply chain.
Whether your technology is defence-focused or not, if you operate in areas such as artificial intelligence, drone technologies, advanced materials, sensors, software, or logistics, you can position the 2026 EDF and subsequent defence calls as a tool for strategic growth and internationalization.
In this process, obtaining expert support to incorporate in the right EU country, manage personnel mobility in compliance with regulations, and prepare your financial/tax structure for funding will both reduce risks and strengthen the credibility of your project proposal.
Disclaimer
This text is prepared for general informational purposes; it does not constitute legal, financial, or tax advice. EU defence funds, immigration, and tax legislation may change frequently. Each specific situation should be evaluated on its own merits. Before making any decisions, we recommend checking current official sources (for example, the relevant pages of the European Commission) and obtaining professional consulting services from experts in the field. Corpenza or the author cannot be held responsible for the consequences of decisions made based on this text.
