Following Canada’s agreement to participate in the EU’s SAFE Instrument, The Innovation Platform contacted Global Affairs Canada to discuss the collaboration and its opportunities
In March 2025, the European Council committed to decisively ramping up Europe’s Defence readiness over the next five years, recognising the urgent need to adapt in order to respond decisively and swiftly. Through the ReArm Europe Plan/Readiness 2030, the European Union aimed to boost European Defence spending by unlocking over €800 bn in investment across five key pillars.
The first of these pillars is the Security Action for Europe (SAFE) Instrument, a €150 bn loan programme designed to accelerate defence preparedness among EU Member States by facilitating “urgent and large-scale procurement initiatives”. The programme aims to provide competitively priced and long-duration loans that reduce reliance on non-participating countries and establish resilient defence procurement within the EU. SAFE focuses on common procurement efforts, requiring projects to involve at least two Member States, or one Member State participating with Ukraine and EEA-EFTA countries, in order to maximise efficiency.
In 2026, Canada entered into an agreement with the EU to participate in the SAFE Instrument. This provided Canadian firms with preferential access and treatment to defence procurements supported by the programme. This collaboration ensures that Canadian companies receive equitable treatment in comparison to their European counterparts, and aims to enhance the collective defence capabilities of both Europe and Canada.
To find out more about Canada’s involvement with the SAFE Instrument, The Innovation Platform Editor Maddie Hall corresponded by email with Global Affairs Canada Spokesperson Thida Ith.
The Canada-EU SAFE Agreement
The EU is a key defence and security partner for Canada. As the EU strengthens its role as a collective security actor, the relationship between Canada and the EU has also grown, as it aligns with Canada’s strategic interests in transatlantic security.
In March 2025, the European Commission presented the “Readiness 2030” Plan (formerly ReArm Europe), aimed at leveraging the EU’s financial strength to provide members with advantageous financing conditions including easing EU fiscal constraints and increasing the flexibility of current programmes. As a component of Readiness 2030, the EU passed the Security Action for Europe legislation, an EU loan programme which allows third parties with a Security and Defence Partnership (SDP) to participate in joint procurement and benefit from some of the Readiness 2030 provisions.
The Canada–EU SAFE Agreement was signed on 14 February, 2026, and entered into provisional application in April 2026, enabling Canadian companies and products to participate more substantially in procurement under the SAFE instrument. Canadian companies can now bid on SAFE-funded contracts with up to 80% Canadian content. Under the Canada-EU SAFE Agreement, Canadian firms will be treated the same as European companies and are eligible to participate as both prime contractors and subcontractors. This preferential access gives European companies a strong incentive to partner with Canadian defence firms. Canadian companies can help supply the products, services and expertise needed to deliver the growing number of defence contracts, while ensuring projects continue to meet SAFE content requirements. By creating greater and more predictable procurement opportunities, SAFE may help stimulate investment in innovation and advanced technologies, support cross-border industrial collaboration, and assist innovative defence capabilities in reaching market and scaling more rapidly.
The SAFE Agreement is unique in that it provides Canada with preferential participation in an EU defence procurement financing mechanism rather than a traditional market-access or free trade arrangement. While Canada maintains defence industrial cooperation arrangements with a number of allies, SAFE provides direct access to procurement supported by EU financing. The SAFE framework also allows other countries that have concluded Security and Defence Partnerships with the EU to negotiate similar arrangements, subject to EU approval.
Strengthening collaboration and expanding opportunities
Canada is also exploring opportunities to deepen defence industrial cooperation with EU Member States, including through potential collaborative procurement and capability-development initiatives where mutually beneficial.
SAFE complements NATO’s objectives by helping European Allies address shared capability shortfalls, expand defence production and undertake more coordinated procurement.
By supporting the acquisition of interoperable capabilities and strengthening transatlantic defence supply chains, Canada’s participation can help Allies meet NATO capability targets, improve readiness and reinforce NATO’s deterrence and collective-defence posture.
Canada is the first non-European country to join the EU’s SAFE defence procurement initiative, underscoring the deepening of Canada-EU security and defence cooperation.
The SAFE Agreement is expected to create new commercial opportunities for Canadian defence companies and may support economic growth, export opportunities, and employment across Canada’s defence industrial base, while contributing to stronger transatlantic defence readiness.
For more details on the SAFE Agreement, please visit: Agreement between the European Union and Canada concerning participation under the SAFE Instrument.
Please note, this article will also appear in the 27th edition of our quarterly publication.
