Council allocates €5 billion under the European Peace Facility

The Council decided to increase the financial ceiling of the European Peace Facility (EPF) by €5 billion in current prices, and ringfence this top-up for Ukraine, by establishing a dedicated Ukraine Assistance Fund (UAF) within the EPF.

The EU is living up to its commitments. The Ukraine Assistance Fund turns our words into action. With the fund, we will continue to support Ukraine defend itself from Russia’s war of aggression with whatever it takes and for as long as we need to.

Josep Borrell, High Representative for Foreign Affairs and Security Policy

The newly established UAF will allow the EU to further support the evolving needs of the Ukrainian Armed Forces through the provision of both lethal and non-lethal military equipment and training.

The UAF will seek to maximise the EU’s added value in terms of delivering more and better operational support to Ukraine, complementing EU member states’ bilateral efforts, and focusing on increased joint procurement from the European and Norwegian defence industries.

In parallel, the Council decided today to improve the governance rules for the facility to make them more sustainable and adapt them to the new international circumstances. The improved governance rules will build on well-functioning national procurement structures as well as existing framework contracts, leveraging both a lead nation approach and the European Defence Agency (EDA), and including the joint procurement of the required defence equipment from the European defence industry and Norway - including small and medium sized enterprises - while allowing for flexibility in supply chains which may include operators established or with production facilities outside the EU or Norway.

The reimbursement of member states’ donations (i.e., from stocks, unilateral and joint purchases of equipment available in the market, and unilateral procurement) will be limited after a transition period.

Following today’s decision, the EPF financial ceiling will total over €17 billion for the 2021-2027 period.

Background

On 1 February 2024, the European Council reaffirmed the EU’s unwavering commitment to continue to provide strong political, financial, economic, humanitarian, military and diplomatic support to Ukraine and its people for as long as it takes.

In that context, the European Council reviewed work in the Council on military support for Ukraine under the European Peace Facility and the proposed increase of its overall financial ceiling. It invited the Council to reach agreement on this matter by early March.