Written By: Giustiniano Cesare Vasey
Supervised By: Finn Seiffert
Edited By: Theodora Posta
ABSTRACT
The European Union finds itself in a structural paradox: while it increasingly aspires to become a credible defence actor, with goals such as strategic autonomy, strengthened interoperability, and long-term military readiness, its own Treaties prohibit the use of the EU budget for military operations. Indeed, the EU framework entrenches an intergovernmental model within which defence spending and capability development remain predominantly national. Yet, recent geopolitical shocks, especially Russia’s 2022 invasion of Ukraine, have exposed the limitations of this framework, and triggered a ‘fiscal turn’ in EU defence. The Union has begun to stretch its legal boundaries through innovative mechanisms, such as the European Peace Facility (off-budget) and the European Defence Fund (budgetary via industrial policy), thereby allowing it to finance defence-related activities de facto, while remaining de jure compliant with Treaty prohibitions. This paper argues that these innovations, while significant, cannot fully resolve the structural deficits in capability development, market scale, R&D investment, and interoperability, which stem from the absence of an EU-level competence in defence.
