This policy brief is the second of a three-paper CER/KAS project, “Shared Values, Common Challenges - UK European Security Co-operation after the War in Ukraine.” The first brief focused on the European Political Community. This paper deals with co-operation in defence capabilities. The last will focus on China policy.

• Security and defence co-operation is not formally part of the UK-EU relationship. However, Russia’s invasion of Ukraine prompted the EU and the UK to work together more closely. The UK and the EU have co-ordinated sanctions against Russia and intensified their dialogue on security and defence issues. The UK has also joined the military mobility project within the EU’s Permanent Structured Cooperation (PESCO) framework.
   

   

• This increased UK-EU defence engagement co-exists with a growing gap in terms of British involvement in the EU’s growing efforts to develop defence capabilities. The UK is not included in EU initiatives to promote joint research and development between EU members through the European Defence Fund (EDF). At the same time, EU countries have recently agreed to procure ammunition jointly using the European Peace Facility (EPF), and the European Commission is trying to foster more joint procurement of military equipment. None of these initiatives allow for much involvement by nonEU countries.
   

   

• The EU’s deepening role in defence has not yet had a major impact on bilateral and small group defence co-operation between the UK and its EU partners. France, Germany and Italy remain important partners for the UK in defence capability development and there is scope for deepening co-operation in many areas. However, growing EU involvement in defence could over time reshape the way defence co-operation between member-states takes place. The UK may eventually find itself shut out of co-operative capability projects. That would be a challenge for the UK but also for the EU, given the expertise and industrial capacity of Britain’s defence sector.
   

   

• A closer and mutually beneficial UK-EU defence relationship is possible. The first steps to improving co-operation would be establishing a formal UK-EU defence and security dialogue and concluding a UK-European Defence Agency (EDA) administrative arrangement. These would provide an institutional underpinning for the relationship and enable more contacts between UK and EU representatives. These steps could be followed by UK involvement in more PESCO projects to test the boundaries of third country involvement in EU capability development tools.
   

   

• Following these steps, the UK and the EU could consider closer UK association with the EPF for future joint procurement projects on the model of the EU’s joint ammunition purchase. That could be complicated, but the EU may be receptive to such an idea if the UK was willing to make a financial contribution to the EPF. In the longer term, closer UK association with the EDF could also be an option.