COM(2026) 20 Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL implementing enhanced cooperation on the establishment of the Ukraine Support Loan for 2026 and 2027

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EUROPEAN COMMISSION

Brussels, 14.1.2026

COM(2026) 20 final

2026/0008 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

implementing enhanced cooperation on the establishment of the Ukraine Support Loan

for 2026 and 2027

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EXPLANATORY MEMORANDUM

1. CONTEXT OF THE PROPOSAL

• Reasons for and objectives of the proposal

The EU is steadfast in its support to Ukraine, whose future lies within the EU. The EU

supports Ukraine’s independence, sovereignty and territorial integrity within its

internationally recognised borders and is unwavering in its commitment to provide political,

financial, economic, humanitarian, military and diplomatic support1. In light of the escalating

Russian aggression, it is necessary to act swiftly to ensure Ukraine has access to the resources

it urgently needs. This proposal is designed to ensure the establishment of a new instrument to

address those urgent needs, by providing Union assistance to Ukraine in the form of a loan to

be repaid by reparations due by Russia.

The large-scale invasion by Russia of Ukraine, which began on 24 February 2022, has had a

profoundly damaging impact on the country and its citizens. Despite diplomatic efforts by the

US and Europe to achieve a peaceful resolution, and Ukraine’s readiness to engage in

dialogue to end the war, Russia has intensified its attacks on Ukraine, deliberately targeting

civilians and critical infrastructures. This escalation has further exacerbated the humanitarian

crisis, caused immense suffering for the Ukrainian people and raised the colossal human and

financial cost of this unprovoked and unjustified military aggression. Russia’s illegal war of

aggression is a blatant violation of the territorial integrity, sovereignty and independence of

Ukraine, as well as a violation of the prohibition on the use of force enshrined in Article 2(4)

of the United Nations (UN) Charter, which is a peremptory rule of international law, and of

the other principles of the UN Charter. The unwavering determination and courage shown by

Ukrainians in defending their homeland is a testament to their strength and warrants deep

admiration and appreciation.

However, Russia’s intensified aggression has increased Ukraine’s financing needs and calls

for urgent investment in the Ukrainian Defence Technological and Industrial Base. It is now

clear that additional sources of funding both from the EU and the international community are

necessary. Ukraine’s financing needs for 2026 and 2027 are set to surpass existing projections

by the International Monetary Fund (IMF), whose eighth review of the IMF Programme

underlines that risks and uncertainty remain exceptionally high, with the existing programme

having limited scope to absorb any new shocks, including from a more prolonged and intense

war. On 9 September 2025, Ukraine has submitted an official request for a new IMF

programme to cover additional financing needs from 2026 to 2029. The IMF’s ability to

proceed with this programme is contingent upon receiving sufficient financing assurances

from partners, including the Union.

Ukraine’s recently presented draft budget for 2026, developed in cooperation with the IMF,

projects defence and security expenditure of EUR 56 billion, supported by EUR 51.6 billion

of in-kind military assistance. Given the negative impact of the war on Ukraine’s economy,

that budget projects that, in addition to the necessary in-kind assistance, EUR 43 billion of

international aid is needed. As of January 2026, only EUR 25 billion has been firmly

committed. Ukraine has limited room for additional fiscal adjustments, as further spending

cuts or tax increases could further harm the economy, which is already vulnerable due to

damage to key infrastructure, labour shortages, and the ongoing displacement and

mobilisation of people. Swift financial assistance is vital to help Ukraine maintain essential

1 European Council Conclusions, 27 June 2024; EUCO 15/24.

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state functions, ensure macroeconomic stability, rehabilitate critical energy infrastructures,

and invest into its Defence Technological and Industrial Base. These needs come on top of

significant requirements for medium-term recovery and reconstruction.

In their summit statement of 8 December 2025, G7 Finance Ministers agreed to continue to

work together to develop a wide range of financing options to support Ukraine, including

potentially using the full value of Russian assets immobilised in G7 jurisdictions until

reparations are paid for by Russia, to end the war and ensure a just and lasting peace in

Ukraine, consistent with G7 legal frameworks.

In its conclusions of 27 June 2024, 17 October 2024, 19 December 2024 and 23 October

2025, the European Council has stated that, subject to Union law, Russia’s assets should

remain immobilised until Russia ceases its war of aggression against Ukraine and

compensates it for the damage caused by this war. Additionally, Council Regulation (EU)

2025/26002 temporarily prohibits the transfer of assets or reserves of the Central Bank of

Russia until Russia ceases its war of aggression against Ukraine, Russia provides reparations

to Ukraine to the extent necessary to allow for reconstruction without adverse economic or

financial consequences for the Union, and Russia’s actions in the context of its war of

aggression against Ukraine have objectively ceased to pose a serious risk of severe difficulties

to the economy of the Union and its Member States.

In that context, on 18 December 2025, the European Council has agreed to provide a loan to

Ukraine of EUR 90 billion for the years 2026-2027 based on EU borrowing on the capital

markets backed by the EU budget headroom. The European Council also agreed that by

means of enhanced cooperation (Article 20 TEU) in respect of the instrument based on Article

212 TFEU, any mobilisation of resources of the Union’s budget as a guarantee for this loan

will not have an impact on the financial obligations of the Czech Republic, Hungary and

Slovakia. On the same date, 25 Member States have agreed that this loan would be repaid by

Ukraine only once reparations are received and that until then, Russian Central Bank assets

will remain immobilised and the Union reserves its right to make use of them to repay the

loan, in full accordance with EU and international law. Those Member States underlined the

importance of the following elements in relation to the loan: (a) strengthening of the European

and Ukrainian defence industries; (b) Ukraine continuing to uphold the rule of law, including

the fight against corruption; and (c) the specific character of the security and defence policy of

certain Member States and the security and defence interests of all Member States.

Against this background, it is proposed to establish a new support instrument for Ukraine of

up to EUR 90 billion, which Ukraine would only repay once it receives reparations from

Russia (the ‘Ukraine Support Loan’). Following requests from the Kingdom of Belgium, the

Republic of Bulgaria, the Kingdom of Denmark, the Federal Republic of Germany, the

Republic of Estonia, the Republic of Croatia, Ireland, the Hellenic Republic, the French

Republic, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the

Grand Duchy of Luxembourg, the Republic of Malta, the Kingdom of the Netherlands, the

Republic of Austria, the Republic of Poland, the Portuguese Republic, Romania, the Republic

of Slovenia, the Republic of Finland, the Kingdom of Spain, the Republic of Italy, the

Kingdom of Sweden, an accompanying proposal from the Commission proposes that

enhanced cooperation be authorised for this loan.

A Ukraine Support Loan

2 Council Regulation (EU) 2025/2600 of 12 December 2025 on emergency measures addressing the

serious economic difficulties caused by Russia’s actions in the context of the war of aggression against

Ukraine (OJ L, 2025/2600, 13.12.2025, ELI: http://data.europa.eu/eli/reg/2025/2600/oj).

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Despite the massive needs of Ukraine, the ability for the Ukrainian state to take on more debt

is severely limited. Ukraine’s debt to GDP has drastically expanded since the start of the war,

jumping from less than 50% of GDP at end 2021 to 85% of GDP in 2025 (more than 100% of

GDP including ERA loans). Given the significant destruction that the war has had on

productivity and the on-going drag that the war has on growth dynamics, the significant

financing needs of Ukraine are not possible to be addressed by Ukraine taking on further debt.

At the same time, Member State’s finances are still recovering from a succession of crises

during the last decade, including the significant expenses generated by Russia’s war in

Ukraine and Russia’s hybrid campaign against the Union. The mobilisation of additional

significant resources by Member States to be able to finance Ukraine would constitute an

important economic challenge.

In this context of difficult debt dynamics of Ukraine due to the on-going Russian aggression

and the challenges associated with Member States finances, including as of Russia’s actions,

it is appropriate to develop an innovative solution that is not expected to place a financial

burden on either Ukraine or Member States.

In line with the International Law Commission’s Draft Articles on the Responsibility of States

for Internationally Wrongful Acts (ARSIWA)3 and customary international law, Russia – as

the responsible state – is under an obligation to make full reparation for the injury caused by

its war of aggression against Ukraine. In particular, Articles 30 – 32 of ARSIWA provide that

“The State responsible for the internationally wrongful act is under an obligation: (a) to

cease that act, if it is continuing; [...]; “The responsible State is under an obligation to make

full reparation for the injury caused by the internationally wrongful act.” “Injury includes

any damage, whether material or moral, caused by the internationally wrongful act of a

State.”

In the context of this legal obligation on Russia to make reparations for the damage that it has

caused through its illegal war of aggression, it is appropriate for the Union to provide the

Ukraine Support Loan as a limited recourse loan that will become due and payable when

Ukraine receives from Russia cash or non-monetary assets as war reparations, indemnities or

any financial settlement from Russia, other than territory.

Use of funds

Given Ukraine’s financing needs and the considerable uncertainty on the future of the war, it

is critical that the Ukraine Support Loan is designed in a flexible manner that is reactive to the

situation. There should be flexibility to use the money towards the most pressing financing

needs, whether driven by the current war situation or also to support reconstruction should

peace prevail.

This proposal provides for a Ukraine Support Loan that will be delivered in a predictable,

continuous, orderly, flexible and timely manner with a view to supporting Ukraine in

covering its financing and defence needs in 2026 and 2027, in particular those resulting from

Russia’s war of aggression. Specifically, the Ukraine Support Loan should support macro-

financial stability in Ukraine and ease its external financing constraints, whether driven by

war or by reconstruction, and support Ukraine’s defence industrial capacities through

economic, financial and technical cooperation.

3 Articles on Responsibility of States for Internationally Wrongful Acts, 2001, International Law

Commission.

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To support macro-financial stability in Ukraine and ease its external financing constraints, the

proposal creates multiple options via which the funds can be channelled to support Ukraine,

where support would be able to be provided through macro-financial assistance and through

the Ukraine Facility. Under both instruments, disbursements will be linked to preconditions

and policy conditions. For macro-financial assistance, those conditions would be set out in a

memorandum of understanding (MoU) between the Commission and Ukraine including

conditions to strengthen revenue mobilisation, tackle root causes of corruption, improving the

sustainability and quality of public expenditure and enhance the efficiency, transparency and

accountability of the public finance management systems. For the Ukraine Facility, the

Ukraine Plan should be updated to reflect these additional amounts, including measures to

strengthen the rule of law and the fight against corruption.

To support Ukraine’s defence industrial capacities through economic, financial and technical

cooperation, the proposal provides for assistance that aims at enabling Ukraine to carry out

urgent and major public investments in support of the Ukrainian defence industry and its

integration into the European defence industry in response to and following the current crisis

situation. In order to urgently reinforce the Ukrainian defence industrial base in an efficient

and autonomous manner, eligibility criteria should be structured in a manner that directs the

activities, expenditures and measures to support Ukraine’s defence industrial capacities

towards the reconstruction, recovery and modernisation of the Ukrainian Defence

Technological and Industrial Base, taking into account its gradual future integration into the

European Defence Technological and Industrial Base. Furthermore, in order to allow Ukraine

to use the financial and economic assistance in the way that is the most adapted to the

circumstances, it is appropriate to allow it to employ the funds to support Ukraine’s defence

industrial capacities by different implementation methods that reflect the diversity of the

needs.

The financial and economic assistance available under the Ukraine Support Loan will be

made accessible to Ukraine in line with its financing needs. To that end, Ukraine will submit a

Ukrainian Financing Strategy on Ukraine’s financing needs and sources. Upon assessment of

the Commission, the Council would approve that assessment and determine the amount of

assistance to be made accessible to Ukraine to assist in the implementation of the Ukrainian

Financing Strategy.

• Consistency with existing policy provisions in the policy area

The support under the Ukraine Support Loan will be consistent with and complementary to

the support provided through Regulation (EU) 2024/7924, Regulation (EU) 2021/9475,

Regulation (EC) No 1257/966, Regulation (EC) No 2024/27737 and Regulation (EU)

4 Regulation (EU) 2024/792 of the European Parliament and of the Council of 29 February 2024

establishing the Ukraine Facility (OJ L, 2024/792, 29.2.2024, ELI:

http://data.europa.eu/eli/reg/2024/792/oj). 5 Regulation (EU) 2021/947 of the European Parliament and of the Council of 9 June 2021 establishing

the Neighbourhood, Development and International Cooperation Instrument – Global Europe,

amending and repealing Decision No 466/2014/EU of the European Parliament and of the Council and

repealing Regulation (EU) 2017/1601 of the European Parliament and of the Council and Council

Regulation (EC, Euratom) No 480/2009 (Text with EEA relevance) (OJ L 209, 14.6.2021, p. 1, ELI:

http://data.europa.eu/eli/reg/2021/947/2021-06-14). 6 Council Regulation (EC) No 1257/96 of 20 June 1996 concerning humanitarian aid (OJ L 163,

2.7.1996, p. 1, ELI: http://data.europa.eu/eli/reg/1996/1257/2019-07-26). 7 Regulation (EU) 2024/2773 of the European Parliament and of the Council of 24 October 2024

establishing the Ukraine Loan Cooperation Mechanism and providing exceptional macro-financial

assistance to Ukraine (OJ L, 2024/2773, 28.10.2024, ELI: http://data.europa.eu/eli/reg/2024/2773/oj).

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2025/11068, and is in line with the respective objectives, intervention logic and rules of these

instruments.

In particular, the Ukraine Support Loan comes in addition and is complementary to the

support provided by the EU under the G7 ERA Loans initiative and the Ukraine Facility.

Specific attention is paid to the consistency and mutual reinforcement of the Ukraine Support

Loan and the implementation of defence policies, provided under the SAFE Regulation and

the proposed EDIP Regulation.

• Consistency with other Union Policies

The support under the Ukraine Support Loan initiative is consistent with the application of

restrictive measures (sanctions) against Russia and complementary to the European Peace

Facility.

Furthermore, the candidate status granted by the European Council on 23 June 2022 and the

decision of the 14-15 December 2023 European Council to open accession negotiations with

Ukraine anchors Ukraine firmly on its European path. For this reason, the whole EU response

in support of Ukraine’s resilience and recovery – including through the Ukraine Support

Loan, which will in turn be consistent with and supporting the implementation of the Ukraine

Facility – will also contribute to the early phase of Ukraine’s pre-accession process.

2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

• Legal basis

Article 212 TFEU is an appropriate legal basis for financial assistance programmes granted by

the Union for third countries, which are not developing countries.

• Subsidiarity (for non-exclusive competence)

The subsidiarity principle is respected as the need for a common response in providing

support to Ukraine on adequate scale cannot be sufficiently achieved by the Member States

alone and, by reasons of its scale and effect, can be better achieved by the EU. The main

reasons are the fiscal capacity and budgetary constraints faced at the national level and the

need for strong donor coordination in order to maximise the scale and effectiveness of the

support, while limiting the burden on the administrative capacity of Ukrainian authorities,

which is very stretched in the current circumstances. The EU is in a unique position to deliver

external assistance to Ukraine to provide support in covering urgent budgetary needs in a

predictable, continuous, orderly and timely manner, including those linked to supporting

Ukraine’s defence industrial capacities.

• Proportionality

The continued unprovoked and unjustified military aggression by Russia requires granting

additional financial assistance to Ukraine in line with the objectives and modalities described

under this proposal.

The proposed financial support to Ukraine is considered adequate in size for 2026 and 2027,

based on the elevated funding needs and best estimates of Ukraine’s defence needs submitted

by the national authorities, while taking into account the high uncertainty of the war

8 Council Regulation (EU) 2025/1106 of 27 May 2025 establishing the Security Action for Europe

(SAFE) through the Reinforcement of the European Defence Industry Instrument (OJ L, 2025/1106,

28.5.2025, ELI: http://data.europa.eu/eli/reg/2025/1106/oj).

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circumstances. Such support does not go beyond what is necessary for the sought purpose to

provide structured support to Ukraine and its related financing.

The proposal is proportionate to the scale and gravity of the deficiencies that have been

identified, including the need to provide budget support to Ukraine, and the need to carry out

urgent and major public investments in support of the Ukrainian Defence Technological and

Industrial Base and its integration into the European Defence Technological and Industrial

Base. The proposal respects the limits of possible Union intervention under the Treaties.

• Choice of the instrument

A Regulation of the European Parliament and of the Council is the appropriate instrument as

it provides directly applicable rules for the implementation of the Ukraine Support Loan.

3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER

CONSULTATIONS AND IMPACT ASSESSMENTS

• Ex-post evaluations/fitness checks of existing legislation

The proposal follows a series of macro-financial assistance operations provided to Ukraine

since 2015. Past ex-post evaluations of previous macro-financial assistance operations to

Ukraine have shown that in general they were highly relevant in terms of their objectives,

financial envelope and policy conditions. In particular, macro-financial assistance operations

proved crucial to support Ukraine in addressing its balance-of-payment problems and

implementing key structural reforms to stabilise the economy and enhance the sustainability

of its external position. They allowed for fiscal savings and financial benefits and acted as a

catalyst for additional financial support and investor confidence. The conditionality attached

to the macro-financial assistance operations was found complementary to the related IMF

programmes. It created a politically reinforcing effect that contributed to the mobilisation of

the Ukrainian authorities around essential reforms, especially in structural policy areas that

are less covered by other international donor programmes.

• Stakeholder consultations

The proposal follows up on the European Council conclusions of 18 December 2025 where

the European Council agreed to provide a loan to Ukraine of EUR 90 billion for the years

2026-2027 based on EU borrowing on the capital markets backed by the EU budget

headroom. In the preparation of this proposal, the Commission services have consulted with

international financial institutions and other bilateral (including Member States and G7

members) and multilateral donors. The Commission is also in regular contact with the

Ukrainian authorities.

Due to the urgency of preparing the proposal for timely adoption by the co-legislators and

ensuring its operational status by early 2026, a formal stakeholder consultation could not be

conducted. This approach aims to address the emerging and escalating defence and budgetary

demands resulting from Russia’s war of aggression. These needs encompass efforts related to

recovery and reconstruction. The European Union will ensure adequate communication and

visibility regarding the objectives and actions implemented under the scope of the Ukraine

Support Loan, both within Ukraine, across the Union, and internationally.

• Collection and use of expertise

The proposal builds on decades long experience with macro-financial assistance as well as on

experience with the Union’s external action support, including the Ukraine Facility since

2024.

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The Commission based this proposal on a careful analysis, also building on inputs from

international financial institutions and other competent international institutions, of the

defence needs and broader macro-economic situation of Ukraine. This includes discussions on

a regular basis of the latest projections of Ukraine’s funding needs within international fora,

such as the G7 and the IMF, as well as continuous direct contact with the Ukrainian

authorities.

• Impact assessment

Due to the urgent nature of the proposal, which is designed to provide urgent assistance to a

country at war, no impact assessment could be carried out. The ex-ante assessment of needs

proposed to be covered by the Ukraine Support Loan inter alia draw upon recent data from

the IMF and Ukrainian authorities. The support under the Ukraine Support Loan should build

upon the lessons learned and achievements of recent support initiatives, such as the G7 ERA

Loans initiative.

• Regulatory fitness and simplification

The proposal is not linked to regulatory fitness and simplification.

• Fundamental rights

A precondition for granting support under the Ukraine Support Loan is that Ukraine continues

to uphold and respect effective democratic mechanisms and its institutions, including a multi-

party parliamentary system, and the rule of law, and to guarantee respect for human rights,

including those of persons belonging to minorities. Upholding and respecting the rule of law

should include the fight against corruption.

The reform-commitment and political will by the Ukrainian authorities is a positive sign, in

particular as evidenced by the European Council granting candidate status to Ukraine in June

2022 and the European Council decision of December 2023 to open accession negotiations

with Ukraine, by the renewed successful completion of the structural policy conditionality

attached to the recent macro-financial assistance operations to Ukraine and the continuing

implementation of the Ukraine Plan. On 14 May 2025, Ukraine adopted roadmaps on (among

others) the rule of law, public administration reform and on the functioning of democratic

institutions. Bilateral screening meetings were completed in September 2025. Since the

Russian aggression, the Ukrainian authorities have shown an impressive degree of resilience

and have remained committed to pursue these reforms in a transparent manner and working

towards EU standards and in line with the country’s path towards EU integration.

In view of this, the precondition for the Ukraine Support Loan is considered to be met at

present. Concurrently, the continuous adherence to this precondition will be further ensured

by specific conditions relating to the Commission’s assessment of future Ukrainian Financing

Strategies and before disbursements. A similar precondition for support is applicable to the

implementation of the Ukraine Plan.

4. BUDGETARY IMPLICATIONS

The Ukraine Support Loan will take the form of a limited recourse loan to Ukraine of up to

EUR 90 billion to be repaid by reparations due by Russia. The loan will be based on EU

borrowing on the capital markets backed by the EU budget headroom. The Union budget will

also cover the debt service costs (cost of funding and costs of issuing and managing liquidity)

related to the borrowing as well the associated administrative costs. To cater for these

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elements, the Regulation on the multiannual financial framework for 2021-2027 will be

revised.

The debt service costs will be financed by a new special instrument over and above the MFF

expenditure ceilings, the Ukraine Loan Instrument, which may be mobilised solely for this

purpose. When mobilising the Ukraine Loan Instrument in the framework of the budgetary

procedure, budgetary availabilities in other special instruments, applicable sectoral rules, any

legal or other obligations including under the EURI Instrument, priorities, prudent budgeting

and sound financial management will be considered.

This loan will be financed under enhanced cooperation, which in accordance with Article 332

of the Treaty on the Functioning of the European Union implies that the resulting

expenditures, other than administrative costs entailed for the institutions, shall be borne by the

participating Member States.

A new budget line will be created to clearly and transparently identify the expenditure related

to the debt service costs resulting from the enhanced cooperation. The methodology to

calculate the contributions of participating Member States is defined in Article 11 of the

Making Available Regulation (Regulation EU, Euratom No 609/2014). Similarly, should the

EU budget guarantee be called, the amounts will be mobilised over and above the MFF

expenditure ceilings and the financial contributions will be borne by participating Member

States, calculated with the same methodology.

Details on the budgetary implications are provided in the Legislative Financial Statement

attached to this proposal.

5. OTHER ELEMENTS

• Implementation plans and monitoring, evaluation and reporting arrangements

The Ukraine Support Loan will be for a maximum amount of EUR 90 billion, to be made

available in accordance with Ukraine’s financing needs per the provisions of this proposal.

Specifically, for the purposes of implementing the Ukraine Support Loan Regulation, Ukraine

is to submit to the European Commission a Ukrainian Financing Strategy providing details on

Ukraine’s financing needs and financing sources in principle for the forthcoming 12 months.

The Commission is to assess the Ukrainian Financing Strategy and, in case of a positive

assessment, submit a proposal to the Council for the approval of its assessment by means of

an implementing decision. The Commission’s proposal will outline the amount of assistance

to be made available to Ukraine to assist in the implementation of the Ukrainian Financing

Strategy, including the amount of that assistance accessible for (i) assistance through the

Ukraine Facility, (ii) macro-financial assistance and (iii) assistance to support Ukraine’s

defence industrial capacities.

To receive financial and economic assistance under the Ukraine Support Loan, Ukraine will

submit to the Commission a duly justified request for funds, which may be submitted by

Ukraine to the Commission, in principle, six times a year.

Furthermore, the Commission will submit to the European Parliament and to the Council a

report on the implementation of the Ukraine Support Loan Regulation in the preceding year,

which will include an evaluation of that implementation. Additionally, by 30 June 2029, the

Commission will submit to the European Parliament and to the Council an evaluation report,

assessing the results and efficiency of the Ukraine Support Loan provided under the Ukraine

Support Loan Regulation and the extent to which it has contributed to the aims of the

assistance.

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Finally, in order to enhance the dialogue between the Union institutions, in particular the

European Parliament, the Council and the Commission, and to ensure greater transparency

and accountability, the competent committee of the European Parliament may invite the

Commission to discuss the implementation of this Regulation.

• Detailed explanation of the specific provisions of the proposal

Chapter I of the Regulation concerns its general provisions.

Article 1 provides the subject matter of the Regulation, which is the establishment of the

Ukraine Support Loan.

Article 2 defines the general and specific objectives of the Ukraine Support Loan, which are

to provide financial and economic assistance to Ukraine in a predictable, continuous manner,

through supporting Ukraine’s macro-financial stability and defence industrial capacities.

Article 3 provides the definitions applicable under the Regulation.

Article 4 sets the available assistance under the Ukraine Support Loan.

Article 5 prescribes the preconditions for assistance under the Ukraine Support Loan.

Chapter II of the Regulation concerns the implementation of the Ukraine Support Loan.

Article 6 stipulates that Ukraine shall submit to the Commission the Ukrainian Financing

Strategy, providing details on its contents, with specific reference to Ukraine’s needs and

financing resources for the next 12 months.

Article 7 provides for the assessment by the Commission of the Ukrainian Financing Strategy,

defining the necessary criteria to be observed.

Article 8 provides for a Council implementing decision making the financial and economic

assistance accessible.

Article 9 provides for the close cooperation between the Commission, Ukraine, Member

States, relevant international bodies and donors to Ukraine to ensure a coherent and consistent

approach to address Ukraine’s financial and economic assistance needs.

Chapter III of the Regulation concerns the Macro-Financial Assistance.

Article 10 provides for the purpose of macro-financial assistance, notably to contribute to

covering Ukraine’s financing gap as identified in a positively assessed Ukrainian Financing

Strategy.

Article 11 sets out that the Commission shall agree with Ukraine on the policy conditions to

which the support is to be linked, which shall be described in a memorandum of

understanding.

Chapter IV of the Regulation concerns assistance to support Ukraine’s Defence Industrial

Capacities.

Article 12 provides for the purpose of the assistance to support Ukraine’s defence industrial

capacities, notably to carry out urgent and major public investments in support of the

Ukrainian defence industry and its integration into the European defence industry.

Article 13 defines the eligibility conditions for the activities, expenditures and measures to

support Ukraine’s defence industrial capacities.

Article 14 requires Ukraine to produce a schedule for each activity, expenditure or measure

related to a defence product or other product for defence purposes for which it intends to

request assistance.

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Article 15 prescribes the establishment of the Ukraine’s Defence Industrial Capacities Expert

Group.

Article 16 provides for the opening of a special account for the sole purpose of the

management of the financial and economic assistance received by Ukraine to support its

defence industrial capacities.

Article 17 sets out the monitoring requirements for the assistance provided to support

Ukraine’s defence industrial capacities.

Article 18 defines the conditions for the modification of an existing framework agreement or

contract for defence products.

Article 19 allows for Member States, for the sole purpose of the Regulation, to request an

economic operator on its territory, to prioritise certain order of defence products.

Chapter V of the Regulation concerns the financing and implementation of the Ukraine

Support Loan.

Article 20 stipulates that the detailed financial terms of the Ukraine Support Loan shall be laid

down in the Ukraine Support Loan Agreement and sets out certain mandatory requirements.

Article 21 sets out that in order for Ukraine to receive financial and economic assistance, it

shall submit to the Commission a duly justified request for funds.

Article 22 provides for a borrowing cost subsidy for the Ukraine Support Loan.

Article 23 prescribes the requirements on the Commission for making a decision to release an

instalment under the Ukraine Support Loan.

Article 24 empowers the Commission to borrow the necessary funds, on behalf of the Union,

to finance the Ukraine Support Loan.

Article 25 lays out the rules on classified information and sensitive information.

Chapter VI concerns final provisions.

Article 26 empowers the Commission to adopt delegated acts, subject to conditions.

Article 27 regulates the governance through committee procedures.

Article 28 provides for a Ukraine Support Loan dialogue, which foresees to enhance

communication between the Union institutions, in particular the European Parliament, the

Council and the Commission.

Article 29 prescribes the provision of information to the European Parliament and to the

Council.

Article 30 regulates the entry into force.

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2026/0008 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

implementing enhanced cooperation on the establishment of the Ukraine Support Loan

for 2026 and 2027

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular

Article 212 TFEU thereof,

Having regard to Council Decision [XX] of [date] authorising enhanced cooperation on the

establishment of a Loan for Ukraine, and in particular Article 1 thereof,

Having regard to the proposal from the Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) On 24 February 2022, the President of the Russian Federation announced a military

operation in Ukraine, and Russia’s armed forces began an unprovoked and unjustified

military aggression against Ukraine. This illegal war of aggression is a blatant

violation of the territorial integrity, sovereignty and independence of Ukraine, as well

as a violation of the prohibition on the use of force enshrined in Article 2(4) of the

United Nations (UN) Charter, which is a peremptory rule of international law, and of

the other principles of the UN Charter.

(2) Since the beginning of Russia’s unprovoked and unjustified war of aggression against

Ukraine, the Union, its Member States and European financial institutions have

mobilised unprecedented support for Ukraine’s economic, social, financial and

defence resilience. That support combines support from the Union budget, including

exceptional macro-financial assistance and support from the European Investment

Bank and the European Bank for Reconstruction and Development, fully or partially

guaranteed by the Union budget, as well as further financial support by Member

States.

(3) Decision (EU) 2022/313 of the European Parliament and the Council9, Decision (EU)

2022/1201 of the European Parliament and the Council10, Decision (EU) 2022/1628 of

the European Parliament and the Council11 and Regulation (EU) 2022/2463 of the

9 Decision (EU) 2022/313 of the European Parliament and of the Council of 24 February 2022 providing

macro-financial assistance to Ukraine (OJ L 55, 28.2.2022, p. 4, ELI:

http://data.europa.eu/eli/dec/2022/313/oj). 10 Decision (EU) 2022/1201 of the European Parliament and of the Council of 12 July 2022 providing

exceptional macro-financial assistance to Ukraine (OJ L 186, 13.7.2022, p. 1, ELI:

http://data.europa.eu/eli/dec/2022/1201/oj). 11 Decision (EU) 2022/1628 of the European Parliament and of the Council of 20 September 2022

providing exceptional macro-financial assistance to Ukraine, reinforcing the common provisioning fund

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European Parliament and the Council12 collectively made available EUR 25.2 billion

of macro-financial assistance to Ukraine throughout 2022 and 2023. This support

constituted a major contributing factor to Ukraine’s macroeconomic and financial

resilience at a critical time.

(4) On 29 February 2024, Regulation (EU) 2024/792 of the European Parliament and of

the Council13 established the Ukraine Facility as an exceptional medium-term

instrument that brings together the bilateral support provided by the Union to Ukraine,

ensuring coordination and efficiency (the ‘Ukraine Facility’). Over the period 2024 to

2027, the Ukraine Facility helps address Ukraine’s financing needs and contributes to

its recovery, reconstruction and modernisation needs, while at the same time

supporting Ukraine’s reforms effort as part of its path towards accession to the Union.

(5) On 24 October 2024, Regulation (EU) 2024/2773 of the European Parliament and the

Council14 established the Ukraine Loan Cooperation Mechanism and provided

exceptional macro-financial assistance to Ukraine. That assistance was the Union

contribution as part of the G7 ‘Extraordinary Revenue Acceleration Loans for

Ukraine’ initiative, which collectively assisted in addressing Ukraine’s financing gap

for 2025.

(6) Russia’s war of aggression against Ukraine has caused tremendous damage in

Ukraine, with estimated recovery and reconstruction costs of EUR 506 billion as of 31

December 2024. Moreover, Ukraine has lost access to international financial markets

and experienced a significant drop in public revenue, while public expenditure has

increased substantially. Against that background, substantive funding needs for the

coming years can be foreseen.

(7) On 9 September 2025, Ukraine submitted an official request to the International

Monetary Fund (IMF) for a new programme to cover additional financing needs from

2026 to 2029. That programme would succeed the successful implementation of the

existing IMF programme, where Ukraine completed eight reviews, but takes into

consideration that Russia’s war of aggression has continued. The IMF’s ability to

proceed with this programme is contingent upon receiving sufficient financing

assurances from other partners, including the European Union.

(8) Despite ongoing international efforts to broker a peaceful resolution to the conflict, the

prolongation of Russia's war of aggression has resulted in significant damage to

Ukraine's critical defence, civilian and energy infrastructure, necessitating the

mobilisation of substantial additional resources to address the country's immediate

financing needs.

by guarantees by Member States and by specific provisioning for some financial liabilities related to

Ukraine guaranteed under Decision No 466/2014/EU, and amending Decision (EU) 2022/1201 (OJ L

245, 22.9.2022, p. 1, ELI: http://data.europa.eu/eli/dec/2022/1628/oj). 12 Regulation (EU) 2022/2463 of the European Parliament and of the Council of 14 December 2022

establishing an instrument for providing support to Ukraine for 2023 (macro-financial assistance +) (OJ

L 322, 16.12.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2463/oj). 13 Regulation (EU) 2024/792 of the European Parliament and of the Council of 29 February 2024

establishing the Ukraine Facility (OJ L, 2024/792, 29.2.2024, ELI:

http://data.europa.eu/eli/reg/2024/792/oj). 14 Regulation (EU) 2024/2773 of the European Parliament and of the Council of 24 October 2024

establishing the Ukraine Loan Cooperation Mechanism and providing exceptional macro-financial

assistance to Ukraine (OJ L, 2024/2773, 28.10.2024, ELI: http://data.europa.eu/eli/reg/2024/2773/oj).

EN 3 EN

(9) Russia’s war of aggression against Ukraine represents a strategic geopolitical threat to

the Union as a whole and requires Member States to stand strong and united. It is

therefore essential that Union support be deployed rapidly and be able to adapt

flexibly for immediate relief and short-term rehabilitation on the way to future

reconstruction.

(10) In line with the Articles on the Responsibility of States for Internationally Wrongful

Acts and customary international law, Russia – as the responsible state – is under an

obligation to make full reparation for the injury caused by its war of aggression.

(11) Decision (CFSP) 2022/335 of 28 February 2022 amending Decision 2014/512/CFSP

concerning restrictive measures in view of Russia’s actions destabilising the situation

in Ukraine15 and Council Regulation (EU) 2022/334 of 28 February 2022 amending

Council Regulation (EU) No 833/201416 prohibits transactions related to the

management of reserves as well as of assets of the Central Bank of Russia including

transactions with any legal person, entity or body acting on behalf of, or at the

direction of, the Central Bank of Russia. In its conclusions of 27 June 2024, 17

October 2024 and 19 December 2024, the European Council has stated that, subject to

Union law, Russia’s assets should remain immobilised until Russia ceases its war of

aggression against Ukraine and compensates it for the damage caused by this war.

(12) Additionally, Council Regulation (EU) 2025/260017 prohibits the transfer of assets or

reserves of the Central Bank of Russia on a temporary basis until Russia ceases its war

of aggression against Ukraine; Russia provides reparations to Ukraine to the extent

necessary to allow for reconstruction without adverse economic or financial

consequences for the Union; and Russia’s actions in the context of its war of

aggression against Ukraine have objectively ceased to pose a serious risk of severe

difficulties to the economy of the Union and its Member States.

(13) On 18 December 2025, the European Council has agreed to provide a loan to Ukraine

of EUR 90 billion for the years 2026 and 2027 based on Union borrowing on the

capital markets backed by the Union budget headroom. The European Council also

agreed that by means of enhanced cooperation in accordance with Article 20 of the

Treaty on European Union, any mobilisation of resources of the Union’s budget as a

guarantee for this loan should not have an impact on the financial obligations of the

Czech Republic, Hungary and Slovakia. On the same date, 25 Member States have

agreed that this loan should be repaid by Ukraine only once reparations are received.

Until then, the assets of the Central Bank of Russia should remain immobilised and the

Union should reserve its right to make use of them to repay the loan, in full

accordance with EU and international law. Those Member States underlined the

importance of the following elements in relation to the loan: (a) strengthening of the

European and Ukrainian defence industries; (b) Ukraine continuing to uphold the rule

of law, including the fight against corruption; and (c) the specific character of the

15 Council Decision (CFSP) 2022/335 of 28 February 2022 amending Decision 2014/512/CFSP

concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ L

57, 28.2.2022, p. 4, ELI: http://data.europa.eu/eli/dec/2022/335/oj). 16 Council Regulation (EU) 2022/334 of 28 February 2022 amending Council Regulation (EU) No

833/2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in

Ukraine (OJ L 57, 28.2.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/334/oj). 17 Council Regulation (EU) 2025/2600 of 12 December 2025 on emergency measures addressing the

serious economic difficulties caused by Russia’s actions in the context of the war of aggression against

Ukraine (OJ L, 2025/2600, 13.12.2025, ELI: http://data.europa.eu/eli/reg/2025/2600/oj).

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security and defence policy of certain Member States and the security and defence

interests of all Member States.

(14) On [DATE], the Council adopted Decision [XX] authorising enhanced cooperation

between Belgium, Bulgaria, Denmark, Germany, Estonia, Ireland, Greece, Spain,

France, Italy, Croatia, Cyprus, Latvia, Lithuania, Luxembourg, Malta, Netherlands,

Austria, Poland, Portugal, Romania, Slovenia, Finland and Sweden on the

establishment of a Loan for Ukraine.

(15) Given the financing position of Ukraine, the criticality that Ukraine has the resources

to counter Russia’s aggression and, where possible, reconstruct, it is appropriate that

the Union provide additional support to address Ukraine's urgent financing

requirements and facilitate the implementation of the IMF programme. To that end, it

is appropriate to establish an instrument for providing Union support to Ukraine in

2026 and 2027 in the form of a loan to be repaid by reparations due by Russia (the

‘Ukraine Support Loan’).

(16) The Ukraine Support Loan should provide financial assistance to Ukraine in a

predictable, continuous, orderly, flexible and timely manner with a view of supporting

Ukraine in covering its financing and defence needs, in particular those resulting from

Russia’s war of aggression. Specifically, the Ukraine Support Loan should support

macro-financial stability in Ukraine and ease its external financing and support

Ukraine’s defence industrial capacities through economic, financial and technical

cooperation, thereby contributing to providing Ukraine a Qualitative Military Edge.

(17) The Ukraine Support Loan should, subject to conditions, provide support to Ukraine in

the form of a loan of up to EUR 90 000 000 000. In view of the principle of sound

financial management, the Ukraine Support Loan should be made available by the

Commission in instalments, which may be disbursed in one or more tranches.

(18) The support to Ukraine under the Ukraine Support Loan should be made available

under the precondition that Ukraine continues to uphold and respect effective

democratic mechanisms, including a multi-party parliamentary system and the rule of

law, and to guarantee respect for human rights, including those of persons belonging

to minorities. Upholding and respecting the rule of law should include the fight against

corruption.

(19) The financial and economic assistance available under the Ukraine Support Loan

should be made accessible to Ukraine in line with its financing needs. To that end,

Ukraine should submit a Ukrainian Financing Strategy on its financing needs and

sources. That Ukrainian Financing Strategy should contain the main information on

Ukraine’s budget, financial and economic situation, as well as the support that Ukraine

is receiving from the international community.

(20) The Commission should assess the Ukrainian Financing Strategy without undue delay

and should act in close cooperation with Ukraine. Given the significant scale of

Ukraine’s needs for both budget assistance and assistance for defence industrial

capacities, as well as the constraints that some external partners have on the provision

of their support, it is appropriate to establish an indicative distribution of the Ukraine

Support Loan between those two financing needs. Whilst ensuring that Ukraine’s

financing needs as calculated by the IMF for 2026 are fully addressed, that distribution

should be indicative in order to reflect changing circumstances that may impact

Ukraine’s financing needs and to ensure that those needs continue to be addressed in a

predictable, continuous, orderly, flexible and timely manner. In its assessment of the

EN 5 EN

Ukrainian Financing Strategy, the Commission should consider the consistency of the

expected external financing gap with that indicative distribution.

(21) In view of the importance of the financial effects of the measures imposed,

implementing powers should be conferred on the Council which should act on the

basis of a Commission proposal. The Council should approve the assessment of the

Ukrainian Financing Strategy by means of an implementing decision, which it should

endeavour to adopt without undue delay from the adoption of the proposal. That

implementing decision should determine the amount of assistance to be made

accessible to Ukraine to assist in the implementation of the Ukrainian Financing

Strategy, including the amount for budget assistance and the amount for supporting

Ukraine’s defence industrial capacities.

(22) Financial and economic assistance in the form of budget assistance should be made

available in view of supporting Ukraine in covering its financing needs. The financial

and economic assistance under this Regulation provides important input into Ukraine’s

post-war economic recovery, long-term growth and prosperity all of which will have

an important role to play in a future peace agreement. To ensure flexibility in

addressing those needs, it is appropriate to use multiple means of delivery, where

support should be able to be provided through macro-financial assistance and through

a loan to be implemented pursuant to Chapter III of the Ukraine Facility.

(23) Chapter III of the Ukraine Facility provides for financing to Ukraine upon satisfactory

fulfilment of the conditions laid down in the Ukraine Plan, which sets out the reform

and investment agenda of Ukraine. As a medium-term instrument that has the

objective to support Ukraine’s recovery and reconstruction, gradual integration into

the internal market, as well as, inter alia, the adoption and implementation of the

political, institutional, legal, administrative, social and economic reforms required to

align to Union values and to progressively align to Union rules, standards, policies and

practices (‘acquis’) with a view to future Union membership, thereby contributing to

mutual stability, security, peace, prosperity and sustainability, it is appropriate to

provide for amounts stemming from the Ukraine Support Loan to be utilised through

the Ukraine Facility. The Ukraine Plan should be updated to reflect these this

additional budget assistance, including measures to strengthen the rule of law and the

fight against corruption.

(24) Macro-financial assistance should be linked to policy conditions to be set out in the

MoU. The MoU should include robust and ambitious reform commitments by

Ukraine, including those to strengthen revenue mobilisation to support Ukraine’s

financing needs and tackle the root causes of corruption in public finances, including

via improving the sustainability and quality of public expenditure and enhancing the

efficiency, transparency and accountability of the public finance management systems.

Such macro-financial assistance may be used by Ukraine to assist in the financing of

compensation, as a form of reparations, to those individuals who have suffered

damage from the illegal actions of Russia, including through the Claims Commission

for Ukraine established under the auspices of the Council of Europe. The Council

implementing decision approving the assessment of the Ukrainian Financing Strategy

should establish the maximum number and indicative value of instalments for the

macro-financial assistance. In view of the principle of sound financial management

and to facilitate the Ukrainian authorities’ liquidity management and ensure

predictability, there should, in principle, be a maximum of four instalments of that

macro-financial assistance.

EN 6 EN

(25) In order to ensure uniform conditions for the implementation of this Regulation, and

for reasons of efficiency, the Commission should be empowered to negotiate

conditions for the macro-financial assistance with the Ukrainian authorities under the

supervision of the committee of representatives of the Participating Member States in

accordance with Regulation (EU) No 182/2011 of the European Parliament and of the

Council18. Considering the potentially significant impact of assistance, it is appropriate

that the examination procedure as specified in Regulation (EU) No 182/2011 be used.

Considering the amount of the Ukraine Support Loan, the examination procedure

should apply to the adoption of the MoU and to any reduction or cancellation of the

Ukraine Support Loan.

(26) The Ukraine Support Loan should provide financial and economic assistance to

Ukraine as a country at war, the financial stability of which is intrinsically linked to

and depends on its ability to defend itself against the aggression. This justifies that a

specific amount of the financial and economic assistance to Ukraine is used to increase

Ukraine’s capacity to cope with budgetary needs in relation with the capacity of the

country to strengthen its defence and military capabilities, thereby contributing to

providing Ukraine a qualitative military edge. This financial and economic assistance

should aim at enabling Ukraine to carry out urgent and major public investments in

support of the Ukrainian defence industry and its integration into the European

defence industry in response to and following the current crisis situation. This

assistance should contribute, in particular, to the reconstruction, recovery and

modernisation of the Ukrainian Defence Technological and Industrial Base, with a

view to increasing its defence industrial readiness, taking into account its gradual

future integration into the European Defence Technological and Industrial Base and

through support for the timely availability of defence products and other products for

defence purposes, through cooperation between the Union and Ukraine.

(27) Financial and economic assistance to support Ukraine’s defence industrial capacities

should be made available for activities, expenditures and measures related to defence

products or other products for defence purposes that meet certain eligibility criteria. In

order to urgently reinforce the Ukrainian defence industrial base in an efficient and

autonomous manner, those eligibility criteria should be structured in a manner that

directs the activities, expenditures and measures to support Ukraine’s defence

industrial capacities towards the reconstruction, recovery and modernisation of the

Ukrainian Defence Technological and Industrial Base, taking into account its gradual

future integration into the European Defence Technological and Industrial Base. In

that context, when examining whether manufacturers are controlled by third countries

or third-country entities, control should be understood as the ability to exercise a

decisive influence over a legal entity, directly or indirectly, through one or more

intermediate legal entities.

(28) In order to allow Ukraine to use the financial and economic assistance in the way that

is the most adapted to the circumstances, it is appropriate to allow it to employ the

funds to support Ukraine’s defence industrial capacities by different implementation

methods that reflect the diversity of the needs. The funds may also contribute to the

Ukraine Support Instrument under Regulation (EU) [the EDIP Regulation], the

18 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011

laying down the rules and general principles concerning mechanisms for control by the Member States

of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13,

ELI: http://data.europa.eu/eli/reg/2011/182/oj).

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Ukraine Investment Framework established by the Ukraine Facility for dual-use goods

or other Union programmes. Moreover, the funds should allow Ukraine to engage in a

massive intervention in the demand of defence products in order to create the suitable

conditions to incentivise massive investments in the ramp up of the production

capacity and in the development of new products. To this purpose, Ukraine should be

allowed to use the funds to launch massive procurements of defence products made

from the Ukrainian Defence Technological and Industrial Base and the European

Defence Technological and Industrial Base via procurements under the SAFE

Instrument set out by Council Regulation (EU) 2025/110619 or, subject to validations,

under other modalities.

(29) For certain defence products whose underlying technologies are not widely available

in the Union and which may be difficult to substitute at a large scale, such as air and

missile defence systems and strategic enablers additional conditions should be

required in order to ensure Ukraine’s armed forces freedom related to those products

without limitations imposed by third countries. Therefore, for such defence products,

the manufacturer should have the ability to decide, without any restriction being

imposed by third countries or third-country entities, on the definition, adaptation or

evolution of the design of the defence products procured, including the legal authority

to substitute or remove those components that are subject to restrictions imposed by

third countries or by third-country entities.

(30) To ensure a smooth implementation of this Regulation in conjunction with the SAFE

Instrument, it is appropriate to apply similar eligibility conditions. The SAFE

instrument supports the procurement of defence products as identified in the SAFE

regulation. The list of products being part of Category 1 and 2 has been agreed by the

Council, and it has proven comprehensive enough to allow support for the

procurement of products needed by Member States, including air platforms. Given the

constantly evolving situation on the battlefield, it is essential to avoid that the

existence of a list of products that can be supported constrains Ukraine in getting the

assistance it needs. Taking into account the fact that Ukraine is a country at war whose

capacity to defend its territory might depend on the availability of a given product at

very short term, Ukraine should be allowed to procure products which do not comply

with these eligibility conditions where there is an urgent need for a product and where

no alternative product is available by procurement. To that end, Ukraine should

provide to the Commission the information reasonably available to it to demonstrate

that a derogation is necessary, where whilst the war is ongoing, when Ukraine’s needs

are as such urgent, it should not require extensive market research. In order to ensure

uniform conditions for the implementation of this Regulation, and for reasons of

efficiency, the Commission should be empowered to examine such requests for

derogations under the supervision of the committee of representatives of the

Participating Member States in accordance with Regulation (EU) No 182/2011.

Considering the potentially significant impact of assistance, it is appropriate that the

examination procedure as specified in Regulation (EU) No 182/2011 be used. Due to

the exceptional situation caused by Russia’s war of aggression and the necessity for

the timely availability of defence products, it is appropriate that the duly justified case

referred to in Article 3(3) of Regulation (EU) No 182/2011 is invoked to allow for an

19 Council Regulation (EU) 2025/1106 of 27 May 2025 establishing the Security Action for Europe

(SAFE) through the Reinforcement of the European Defence Industry Instrument (OJ L, 2025/1106,

28.5.2025, ELI: http://data.europa.eu/eli/reg/2025/1106/oj).

EN 8 EN

opinion of the committee within a time limit which the chair of the committee may lay

down according to the urgency of the matter. Where necessary, the written procedure

referred to in Article 3(5) of that Regulation should be used.

(31) To further ensure a smooth implementation of Regulation in conjunction with the

SAFE Instrument, it is appropriate that there is the possibility to extend eligibility

conditions to manufacturers within third countries that have concluded an agreement

with the Union in accordance with Article 17 of Council Regulation 2025/1106.

(32) This Regulation is without prejudice to applicable international law prohibiting the

use, development or production of certain defence products and technologies.

(33) The implementation of the assistance to support Ukraine’s defence industrial

capacities should be carried out in line with the principles of sound financial

management ensuring the protection of the financial interests of the Union as set out in

Article 223(4) of Regulation (EU, Euratom) 2024/2509 of the European Parliament

and the Council20. Detailed requirements in this respect might be entered into an

arrangement to be signed between the Commission and Ukraine. Furthermore, for the

management of the financial and economic assistance received to support Ukraine’s

defence industrial capacities, Ukraine should open a single account via which to

manage the assistance, where the Commission should be able to monitor that account.

(34) To support the implementation of assistance to support Ukraine’s defence industrial

capacities, the Commission should establish the Ukraine’s Defence Industrial

Capacities Expert Group. That Expert Group should advise the Commission on

matters related to the assistance to support Ukraine’s defence industrial capacities.

(35) The Commission should monitor the implementation of assistance to support

Ukraine’s defence industrial capacities, notably including the delivery of products. To

that end, various monitoring arrangements should be established to reflect the different

methods of implementation.

(36) Directive 2009/81/EC of the European Parliament and of the Council21 concerns,

amongst other things, the establishment of an appropriate legislative framework on the

coordination of procurement procedures for the award of contracts to meet the security

requirements of Member States and the obligations arising from the TFEU. To achieve

that aim, that Directive 2009/81/EC caters, in particular, for addressing crisis

situations, notably by providing specific provisions applicable in cases of urgency

resulting from a crisis, such as shortening periods for the receipt of tenders and the

possibility to use the negotiated procedure without prior publication of a contract

notice. However, in certain cases of urgency, those rules might be insufficient,

especially where the urgency resulting from the crisis can be addressed only by having

Ukraine and at least one Participating Member State engaging in a common

procurement. In those cases, often the only solution that ensures the security interests

of those countries is to open an existing framework agreement or contract of a

Participating Member State to contracting authorities of Ukraine that was not

20 Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council of 23 September

2024 on the financial rules applicable to the general budget of the Union (OJ L, 2024/2509, 26.9.2024,

ELI: http://data.europa.eu/eli/reg/2024/2509/oj). 21 Directive 2009/81/EC of the European Parliament and of the Council of 13 July 2009 on the coordination

of procedures for the award of certain works contracts, supply contracts and service contracts by

contracting authorities or entities in the fields of defence and security, and amending Directives

2004/17/EC and 2004/18/EC (OJ L 216, 20.8.2009, p. 76, ELI: http://data.europa.eu/eli/dir/2009/81/oj).

EN 9 EN

originally party to it, even though that possibility had not been provided for in the

original framework agreement or contract. As those possibilities are not foreseen in

Directive 2009/81/EC at the moment of the entry into force of this Regulation, the

latter provides for the possibility to complement or derogate from the provisions of

that Directive in the current crisis situation stemming from the war of aggression of

Russia, provided that the agreement of the undertaking which concluded the

framework agreement is obtained. With respect to additional quantities for Ukraine,

Ukrainian contracting authorities should enjoy the same conditions as the original

contracting authority that concluded the original framework agreement. In addition,

appropriate transparency measures should be taken to ensure that all potentially

interested parties are informed.

(37) Council Regulation (EU) 2025/1106 provides for financial assistance to Member

States, enabling them to carry out urgent and major public investments in support of

the European defence industry in response to the crisis situation resulting from the

stark deterioration in the Union’s security context. With that instrument, the Union

started to support Member States so that they can place orders rapidly, incentivising

the defence industrial sector to invest, in the very short term, in the strengthening of

production capacities in order to be able to serve Member States needs by 2030. In

addition, this Regulation supports the placement of Ukrainian orders with the

European Defence Technological and Industrial Base in order to support the

cooperation between the European Defence Technological and Industrial Base and the

Ukrainian Defence Technological and Industrial Base. Such an exceptionally high

demand for a wide range of defence products carries an imminent risk of a severe

negative impact on the proper functioning of the internal market. In order to address

this risk and in view of the objectives of this Regulation, taking into account the

specific situation of Ukraine, prioritisation measures at Union level that aim to ensure

the availability of the defence products concerned could prove to be indispensable in

ensuring the proper functioning of the internal market for defence products and its

supply chains. The Commission should be able to use in this respect, upon a request of

a Participating Member State, priority-rated requests for facilitating the supply of

defence products to meet the objectives of this Regulation.

(38) Priority-rated requests should consist of requests by the Commission, upon an

initiative of a Participating Member State, to relevant economic operators established

in the Union to accept or to prioritise orders of crisis-relevant products. Only to be

used when necessary and proportionate for the purpose of ensuring that defence supply

chains can operate normally, those priority-rated requests should be aimed at

supporting Ukraine which faces severe difficulties either in the placing of an order or

in the execution of a contract for the supply of defence products. Economic operators

should have the possibility to refuse to be subject to a priority-rated request. A

priority-rated request should be taken based on objective, factual, measurable and

substantiated data. It should have regard for the legitimate interests of the undertakings

and the cost and effort required for any change in production sequence. When

accepted, the obligation to perform the priority-rated request should take precedence

over performance obligations under private or public law. In light of the importance of

ensuring the supply of defence products, which are indispensable to the correct

functioning of the internal market and its supply chains, compliance with the

obligation to perform a priority-rated request should not entail liability to third parties

for damages that might result from any breach of contractual obligations governed by

the law of a Member State, to the extent that the breach of contractual obligations was

necessary for compliance with the mandated prioritisation. Where the economic

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operator has expressly accepted a priority-rated request and the Commission has

adopted an implementing act following such an acceptance, the economic operator

should comply with all the conditions of that implementing act. Non-compliance by

the economic operator with the conditions laid down in the implementing act should

result in a loss of the benefit of a waiver of contractual liability. Where the non-

compliance is intentional or attributable to gross negligence, the Commission should

be able to impose on the economic operator a fine, subject to the proportionality

principle.

(39) Given that specific amounts should be made available for budget assistance and

assistance to support Ukraine’s defence industrial capacities, coherence and

complementarity should be ensured in their respective implementation.

(40) This Regulation should apply without prejudice to the specific character of the security

and defence policy of certain Member States.

(41) This Regulation does not apply to Member States that are not participant to the

enhanced cooperation. In this context, it should be recalled that the non-participation

of certain Member States to this enhanced cooperation does not exempt them from the

obligation to ensure the full enforcement of Article 325 TFEU and the Union acquis

aiming at ensuring the protection of Union’s financial interests, including Council

Regulation (EC, Euratom) No 2988/9522; Regulation (EU, Euratom) No 883/2013 of

the European Parliament and of the Council23, Directive (EU) 2017/1371 of the

European Parliament and of the Council24, the rules of Regulation (EU, Euratom)

2024/2509 and where applicable, Council Regulation (EU) 2017/193925. These

Member States and the economic entities under their jurisdiction should thus fully

collaborate with the Court of Auditor, OLAF, the Commission and, where applicable

EPPO, in the exercise of their competences.

(42) The Ukraine Support Loan Agreement to be concluded between the Commission and

the Ukrainian authorities should contain provisions aligned with the rights,

responsibilities and obligations provided for in the framework agreement under the

Ukraine Facility referred to in Article 9 of Regulation (EU) 2024/792 signed between

the Union and Ukraine that entered into force on 20 June 2024. That will ensure that

the Union’s financial interests linked to the Ukraine Support Loan are protected

efficiently, providing the appropriate measures relating to the prevention of, and fight

against, fraud, corruption and any other irregularities linked to the assistance. It will

also, in accordance with Regulation (EU, Euratom) 2024/2509, grant the necessary

rights and access to the Commission, the European Anti-Fraud Office (OLAF), the

European Court of Auditors and, where applicable, the European Public Prosecutor’s

22 Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European

Communities financial interests (OJ L 312, 23.12.1995, p. 1, ELI:

http://data.europa.eu/eli/reg/1995/2988/oj). 23 Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September

2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing

Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation

(Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1, ELI: http://data.europa.eu/eli/reg/2013/883/oj). 24 Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight

against fraud to the Union's financial interests by means of criminal law (OJ L 198, , p. 29,

ELI: http://data.europa.eu/eli/dir/2017/1371/oj). 25 Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the

establishment of the European Public Prosecutor’s Office (‘the EPPO’) (OJ L 283, 31.10.2017, p. 1, ELI:

http://data.europa.eu/eli/reg/2017/1939/oj).

EN 11 EN

Office, including from third parties involved in the implementation of Union funds

during and after the availability period of the Ukraine Support Loan. Ukraine should

also report irregularities in relation to the use of the funds to the Commission, in line

with the procedures provided for in the framework agreement under the Ukraine

Facility.

(43) Given the difficult situation of Ukraine caused by Russia’s war of aggression and in

order to support Ukraine on its long-term stability path, it is appropriate for the Union

to provide the Ukraine Support Loan as a limited recourse loan that is to become due

and payable when Ukraine receives from Russia cash or non-monetary assets for war

reparations, indemnities or any financial settlement from Russia, other than territory.

(44) The release of funds under the Ukraine Support Loan should be contingent on the

positive assessment by the Commission of a request for funds submitted by Ukraine.

For the macro-financial assistance, the assessment of the conditions should be without

prejudice to the assessment of the fulfilment of conditions under other Union

programmes and instruments. For the assistance to support Ukraine’s defence

industrial capacities, the release of funds should be linked to contracts or agreements

for activities, expenditures and measures to support Ukraine’s defence industrial

capacities related to defence products or other products for defence purposes.

(45) This Regulation should lay down appropriate provisions for the financing of the

Ukraine Support Loan.

(46) In the context of Ukraine’s financing needs, it is appropriate to organise the financial

assistance under the diversified funding strategy provided for in Article 224 of

Regulation (EU, Euratom) 2024/2509.

(47) In line with the firm support of 25 Heads of State and Government in the margins of

the European Council of 18 December 2025, the Ukraine Support Loan should be

repaid by Ukraine once reparations from Russia are received, and the Union reserves

its right to make use of the Russian assets immobilised in the Union to repay the loan,

in full accordance with EU and international law.

(48) By way of derogation from Article 31(3) of Regulation (EU) 2021/947 of the

European Parliament and of the Council26, the financial liability from loans under this

Regulation should not be supported by the External Action Guarantee, established by

that Regulation. Support in the form of loans under this Regulation should constitute

financial assistance within the meaning of Article 223(1) of Regulation (EU, Euratom)

2024/2509. In considering the financial risks and the presence of guarantees, no

provisioning should be constituted for the support in the form of loans under this

Regulation, to be guaranteed over and above the ceilings, and, by way of derogation

from Article 214(1) of Regulation (EU, Euratom) 2024/2509, no provisioning rate

should be set.

(49) Given the situation of Ukraine, caused by Russia’s war of aggression and to support it

on its long-term stability path, it is appropriate to derogate from Article 223(4), point

26 Regulation (EU) 2021/947 of the European Parliament and of the Council of 9 June 2021 establishing

the Neighbourhood, Development and International Cooperation Instrument – Global Europe,

amending and repealing Decision No 466/2014/EU of the European Parliament and of the Council and

repealing Regulation (EU) 2017/1601 of the European Parliament and of the Council and Council

Regulation (EC, Euratom) No 480/2009 (Text with EEA relevance) (OJ L 209, 14.6.2021, p. 1, ELI:

http://data.europa.eu/eli/reg/2021/947/2021-06-14).

EN 12 EN

(e), of Regulation (EU, Euratom) 2024/2509 and to allow the Union the possibility to

provide a borrowing costs subsidy to cover the costs that would otherwise be borne by

Ukraine. These costs comprise debt service costs (cost of funding and cost of liquidity

management) and related administrative costs. The borrowing costs subsidy to be

granted is deemed appropriate to ensure the effectiveness of the support under the

Ukraine Support Loan within the meaning of Article 223(1) of Regulation (EU,

Euratom) 2024/2509, notably to avoid adding pressure on Ukraine’s public finances.

(50) In accordance with Article 332 TFEU, expenditure other than administrative costs

entailed for the institutions resulting from the enhanced cooperation should be borne

by the Participating Member States. To that effect, Member States which do not

participate in enhanced cooperation should be entitled to an adjustment in accordance

with Article 11 of Council Regulation (EU, Euratom) No 609/201427 in respect of any

operational expenditure borne by the Union budget, comprising in particular debt

service costs, as well as calls on the guarantee. Administrative costs entailed for the

institutions when implementing enhanced cooperation should be borne by the Union

budget without any adjustment for the Member States which do not participate in

enhanced cooperation.

(51) Union support to Ukraine under this Regulation should be managed by the

Commission.

(52) The assistance to Ukraine under the Ukraine Support Loan should be additional and

complementary to the Union support provided under the Ukraine Facility. The

Commission should, wherever possible, seek to minimise the administrative and

reporting burden on Ukraine.

(53) The Commission should duly take into account Council Decision 2010/427/EU28 and

the role of the European External Action Service, in line with their competences.

(54) The competent committee of the European Parliament might invite the Commission to

discuss in a Ukraine Support Loan dialogue matters that concern the implementation

of the Regulation. The Commission should take into account elements arising from the

views expressed through the Ukraine Support Loan dialogue, including the resolutions

from the European Parliament if provided.

(55) In order to ensure that the European Parliament and the Council are able to follow the

implementation of this Regulation, the Commission should regularly inform them of

developments relating to Union assistance to Ukraine under this Regulation and

provide them with the relevant documents.

(56) In order to ensure the continued effectiveness of the arrangements established by this

Regulation, the Commission should regularly review their adequacy and report to the

European Parliament and to the Council thereon, thereby guaranteeing transparency

and accountability.

27 Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for

making available the traditional, VAT and GNI-based own resources and on the measures to meet cash

requirements (Recast) (OJ L 168, 7.6.2014, p. 39, ELI: http://data.europa.eu/eli/reg/2014/609/oj). 28 Council Decision 2010/427/EU of 26 July 2010 establishing the organisation and functioning of the

European External Action Service (OJ L 201, 3.8.2010, p. 30, ELI:

http://data.europa.eu/eli/dec/2010/427/oj).

EN 13 EN

(57) In order to ensure uniform conditions for the implementation of this Regulation,

implementing powers should be conferred on the Commission. Those powers should

be exercised in accordance with Regulation (EU) No 182/2011.

(58) Since the objectives of this Regulation, namely to provide financial and economic

assistance to Ukraine for 2026 and 2027 in a predictable, continuous, orderly and

timely manner with a view to supporting Ukraine in coverings its financing needs

resulting from Russia’s war of aggression, cannot be sufficiently achieved by the

Member States but can rather, by reasons of their scale and effect, be better achieved

at Union level, the Union may adopt measures, where appropriate by means of

enhanced cooperation, in accordance with the principle of subsidiarity as set out in

Article 5 of the Treaty on European Union. In accordance with the principle of

proportionality, as set out in that Article, this Regulation does not go beyond what is

necessary in order to achieve those objectives.

(59) In view of the urgency entailed by the exceptional circumstances caused by Russia’s

unprovoked and unjustified war of aggression, it is considered to be appropriate to

invoke the exception to the eight-week period provided for in Article 4 of Protocol No

1 on the role of national Parliaments in the European Union, annexed to the Treaty on

European Union, to the Treaty on the Functioning of the European Union and to the

Treaty establishing the European Atomic Energy Community.

(60) In light of the situation in Ukraine, this Regulation should enter into force as a matter

of urgency on the day following that of its publication in the Official Journal of the

European Union,

HAVE ADOPTED THIS REGULATION:

CHAPTER I

GENERAL PROVISIONS

Article 1

Subject matter

1. This Regulation implements enhanced cooperation on the establishment of an instrument

for providing Union assistance to Ukraine for 2026 and 2027 in the form of a loan to be

repaid by reparations due by Russia (the ‘Ukraine Support Loan’).

2. It lays down the objective of the Ukraine Support Loan, its financing, the forms of Union

funding under it and the rules for providing such funding.

Article 2

Objectives of the Ukraine Support Loan

1. The general objective of the Ukraine Support Loan shall be to provide financial and

economic assistance to Ukraine in a predictable, continuous, orderly, flexible and timely

manner with a view to supporting Ukraine in covering its financing needs notably

resulting from Russia’s war of aggression and Russia’s non-payment of reparations due.

EN 14 EN

2. To achieve this general objective, the specific objectives of the Ukraine Support Loan

shall be:

a. To support macro-financial stability via easing Ukraine’s external and internal

financing constraints;

b. to support Ukraine’s defence industrial capacities through economic, financial and

technical cooperation.

Article 3

Definitions

For the purposes of this Regulation the following definitions apply:

(1) ‘defence product’ means goods, services and works that fall within the scope of

Directive 2009/81/EC, as set out in Article 2 thereof;

(2) ‘EEA EFTA State’ means a Member of the European Free Trade Association

which is a member of the European Economic Area;

(3) ‘ERA Loans’ means eligible bilateral loans and the Union’s Macro-financial

Assistance loan pursuant to Regulation (EU) 2024/2773;

(4) ‘Non-Participating Member State’ means a Member State which does not

participate in the enhanced cooperation established by Council Decision [XX];

(5) ‘Participating Member State’ means a Member State which participates in the

enhanced cooperation established by Council Decision [XX];

(6) ‘other products for defence purposes’ means any good, service and work other

than those falling within the scope of Directive 2009/81/EC, as set out in

Article 2 thereof, which are necessary for or aimed at defence purposes.

Article 4

Available assistance under the Ukraine Support Loan

1. The Ukraine Support Loan shall be for a maximum amount of EUR 90 000 000 000.

That amount shall be made available to Ukraine in accordance with Ukraine’s financing

needs, as provided for in the Ukrainian Financing Strategy approved in accordance with

Article 8.

2. The Ukraine Support Loan shall be available until 31 December 2027. It shall be made

available by the Commission in instalments, which may be disbursed in one or more

tranches. The disbursement of all such tranches shall take place by 31 December 2028.

3. If the financing needs of Ukraine decrease fundamentally during the period of

availability of the Ukraine Support Loan, including in the event of a settlement by Russia

of Ukraine’s war damages, the Commission, acting in accordance with the examination

EN 15 EN

procedure referred to in Article 27(3), may reduce the undisbursed amount of the

Ukraine Support Loan or cancel it.

4. In accordance with Article 332 TFEU, Non-Participating Member States shall be entitled

to an adjustment in accordance with Article 11 of Council Regulation (EU, Euratom) No

609/2014 in respect of expenditure financed from the voted budget resulting from the

implementation of the enhanced cooperation other than administrative costs entailed for

the institutions, borne by the Union budget. Such adjustment shall in particular comprise

any debt service costs as well as calls on the guarantee.

Article 5

Preconditions for assistance under the Ukraine Support Loan

1. A precondition for granting the assistance under the Ukraine Support Loan shall be that

Ukraine continue to uphold and respect effective democratic mechanisms, including a

multi-party parliamentary system, the rule of law, and to guarantee respect for human

rights, including the rights of persons belonging to minorities. Upholding and respecting

the rule of law shall include the fight against corruption.

2. The Commission services and the European External Action Service shall monitor the

fulfilment of the precondition set out in paragraph 1, in particular before the adoption of

the Council implementing decision referred to in Article 8 and the release of funds

referred to in Article 23. Furthermore, the monitoring shall take into account the relevant

recommendations of international bodies, such as the Council of Europe and its Venice

Commission. The Commission shall inform the European Parliament and the Council of

its monitoring.

CHAPTER II

IMPLEMENTATION OF THE UKRAINE SUPPORT LOAN

Article 6

Ukrainian Financing Strategy

1. In order to receive financial and economic assistance under the Ukraine Support Loan,

Ukraine shall submit, in principle each year, to the Commission a Ukrainian Financing

Strategy that shall provide details on Ukraine’s financing needs and financing sources, in

principle for the forthcoming 12 months.

2. The Ukrainian Financing Strategy shall contain:

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a. the main macroeconomic assumptions underpinning the Ukrainian Financing

Strategy;

b. information on Ukraine’s budget, per quarter and year, including:

i. the targeted budget balance for the general government, broken down by

subsector of general government;

ii. the projections for expenditure and revenue for the general government and its

main subsectors, and their main components according to the economic

classification;

iii. relevant information on the general government expenditure by function,

notably on defence;

iv. a description and quantification of the expenditure and revenue measures to be

included in the budget;

v. an annex containing the methodology and assumptions, and any other relevant

parameters underpinning the budgetary forecasts.

c. information on Ukraine’s past and projected financial developments in the general

government, per quarter and year, including:

i. information on the liquidity situation (cash balance) for the general

government and its main subsectors;

ii. debt amortisations;

iii. a debt issuance strategy;

iv. other debt creating and reducing flows;

v. the stock of payment arrears and its projected developments.

d. information on the implementation of previously granted assistance under the

Ukraine Support Loan, including any financial recoveries thereof;

e. information on projected in-kind military assistance needs;

f. on the basis of Ukraine’s budget and the projected in-kind military assistance needs,

the expected external financing needs for the period covered by that Ukrainian

Financing Strategy, including a breakdown of the amounts in that budget necessary

for the purposes of Article 2(2)(a) and (b) of this Regulation. That breakdown shall

EN 17 EN

contain the value of defence products to be purchased outside the Union and

Ukraine;

g. committed and expected external financing and in-kind military assistance at the

time of submission of the Ukrainian Financing Strategy for the period covered by

that Ukrainian Financing Strategy, including a breakdown of the amounts of that

external financing to be used in line with the purposes of Article 2(2)(a) and (b) of

this Regulation;

h. on the basis of the information in points (f) and (g) of this paragraph, the expected

external financing gap for which Ukraine seeks assistance under the Ukraine

Support Loan under that Ukrainian Financing Strategy, including a breakdown of

the amounts of that expected external financing gap for the purposes of Article

2(2)(a) and (b) of this Regulation;

i. in order to support multiannual expenditure under Chapter IV of this Regulation,

information on potential multiannual needs and a corresponding budget.

3. Ukraine may submit updated Ukrainian Financing Strategies until such time as the

maximum amount of the Ukraine Support Loan as referred to in Article 4(1) has been

made accessible under the Ukraine Support Loan in accordance with Article 8.

Article 7

Commission’s assessment of the Ukrainian Financing Strategy

1. The Commission shall assess the Ukrainian Financing Strategy submitted in accordance

with Article 6 without undue delay.

2. When carrying out the assessment referred to in paragraph 1, the Commission shall act in

close cooperation with Ukraine. The Commission may make observations or seek

additional information, including verifying information with Member States, third

countries and international organisations. Ukraine shall provide any requested additional

information and may revise the Ukrainian Financing Strategy if needed, including after

its submission.

3. The Commission shall assess the Ukrainian Financing Strategy and shall, in particular

assess:

a. the completeness, feasibility and coherence of the Ukrainian Financing Strategy

with the underlying assumptions;

EN 18 EN

b. the consistency of the information in the Ukrainian Financing Strategy with external

sources, including any recent reviews of the International Monetary Fund and

information from the Ukraine Donor Platform and the Ukraine Defence Contact

Group;

c. the consistency of the expected external financing gap with the following indicative

distribution of the Ukraine Support Loan:

i. EUR 30 000 000 000 for macro-financial assistance in accordance with

Chapter III or for budget assistance in the form of a loan to be implemented

under the Ukraine Facility pursuant to Chapter III of Regulation (EU)

2024/792;

ii. EUR 60 000 000 000 to support Ukraine’s defence industrial capacities in

accordance with Chapter IV.

d. compliance with the precondition set out in Article 5(1).

4. Where the Commission gives a positive assessment of the Ukrainian Financing Strategy,

it shall, without delay, submit a proposal for a Council implementing decision in

accordance with Article 8.

5. Where the Commission gives a negative assessment of the Ukrainian Financing Strategy,

it shall, without delay, inform Ukraine, giving reasons for its assessment. A negative

assessment shall not prevent Ukraine from submitting a revised Ukrainian Financing

Strategy.

6. Where the Commission assesses an update to the Ukrainian Financing Strategy, the

provisions of this Article shall apply.

Article 8

Council implementing decision

1. Where the Commission makes a positive assessment of the Ukrainian Financing Strategy

or its update, the Commission shall submit a proposal to the Council for an implementing

decision making the financial and economic assistance accessible.

2. The Council implementing decision referred to in paragraph 1 shall:

a. determine the amount of assistance to be made accessible to Ukraine to assist in the

implementation of the Ukrainian Financing Strategy, including the amount of that

assistance accessible:

EN 19 EN

i. for budget assistance in the form of a loan to be implemented pursuant to

Chapter III of Regulation (EU) 2024/792;

ii. for macro-financial assistance in accordance with Chapter III;

iii. to support Ukraine’s defence industrial capacities in accordance with Chapter

IV.

b. establish the maximum number and indicative value of instalments for the

assistance accessible for macro-financial assistance in accordance with Chapter III.

3. The determination of the amounts of the Ukraine Support Loan to be made accessible

shall:

a. respect the maximum amount available for the Ukraine Support Loan provided in

Article 4(1);

b. take into account the need to ensure a fair burden sharing with other donors in the

coverage of Ukraine’s financing needs.

c. for budget assistance, determine to what extent regular budget assistance can be

provided in the form of a loan to be implemented pursuant to Chapter III of

Regulation (EU) 2024/792 or as macro-financial assistance, as appropriate.

4. The Council shall adopt the implementing decision referred to in paragraph 1 without

undue delay.

Article 9

Complementarity and coordination

1. In the implementation of the Ukraine Support Loan, the Commission shall act in close

cooperation with Ukraine, Member States, relevant international bodies and donors to

Ukraine, notably through the Ukraine Donor Platform and the Ukraine Defence Contact

Group, to ensure a coherent and consistent approach from those supporting Ukraine to

address Ukraine’s financial and economic assistance needs. In doing so, the Commission

shall draw on the expertise of the European External Action Service.

2. Article 5, Article 7, Article 13, Article 14, Article 15 and Article 23(1)(b) shall apply in

accordance with Decision 2010/427/EU.

EN 20 EN

CHAPTER III

BUDGET ASSISTANCE IN THE FORM OF MACRO-

FINANCIAL ASSISTANCE

Article 10

Purpose

1. The macro-financial assistance shall contribute to covering Ukraine’s financing gap, as

identified in a positively assessed Ukrainian Financing Strategy.

2. The release of the macro-financial assistance shall be managed by the Commission on

the basis of its assessment of the precondition referred to in Article 5 and of the

satisfactory fulfilment of the policy conditions included in the memorandum of

understanding referred to in Article 11.

Article 11

Memorandum of Understanding

1. In respect of the approved amounts of macro-financial assistance as referred to in Article

8(2)(a)(ii), the Commission shall agree with Ukraine on policy conditions to which the

macro-financial assistance is to be linked. Those policy conditions shall be set out in a

memorandum of understanding (MoU).

2. The policy conditions shall include robust and ambitious reform commitments, including

those that aim, in particular, at strengthening revenue mobilisation to support Ukraine’s

financing needs and tackle the root causes of corruption in public finances, including via

improving the sustainability and quality of public expenditure and enhancing the

efficiency, transparency and accountability of the public finance management systems.

Where relevant, those commitments shall be consistent with any programme that

Ukraine has with the IMF whilst going further where appropriate. Progress in attaining

the commitments shall be regularly monitored by the Commission.

3. The Commission shall approve the signature of the MoU and of its amendments by

means of implementing acts. Those implementing acts shall be adopted in accordance

with the examination procedure referred to in Article 27(3).

EN 21 EN

CHAPTER IV

ASSISTANCE TO SUPPORT UKRAINE’S DEFENCE

INDUSTRIAL CAPACITIES

Article 12

Purpose

1. The assistance to support Ukraine’s defence industrial capacities shall aim at enabling

Ukraine to carry out urgent and major public investments in support of the Ukrainian

defence industry and its integration into the European defence industry in response to

and following the current crisis situation. This assistance shall contribute, in particular, to

the reconstruction, recovery and modernisation of the Ukrainian Defence Technological

and Industrial Base, with a view to increasing its defence industrial readiness, taking into

account its gradual future integration into the European Defence Technological and

Industrial Base and through support for the timely availability of defence products and

other products for defence purposes, through cooperation between the Union and

Ukraine.

2. The activities, expenditures and measures to support Ukraine’s defence industrial

capacities shall be related to defence products or other products for defence purposes and

shall aim to:

a. speed up the adjustment of the Ukrainian defence industry to structural changes,

including through the creation and ramp-up of its manufacturing capacities as well

as related supporting activities;

b. improve the timely availability of defence products or other products for defence

purposes for Ukraine, including through the reduction of their delivery lead time,

reservation of manufacturing slots or stockpiling of defence products or other

products for defence purposes, intermediate products or raw materials; or

c. enhance cross-border cooperation between the European Defence Technological

and Industrial Base and the Ukrainian Defence Technological and Industrial Base,

taking into account the defence industrial reinforcement and defence procurement

needs of Ukraine, allowing for interchangeability of defence products or other

products for defence purposes manufactured by the Ukrainian defence industry and

the European defence industry.

EN 22 EN

Article 13

Eligibility

1. Activities, expenditures and measures to support Ukraine’s defence industrial capacities

related to defence products and other products for defence purposes shall be eligible for

assistance provided that they comply with the eligibility conditions set out in this Article.

2. Defence products shall belong to one of the following categories:

a. category one: ammunition and missiles; artillery systems, including deep precision

strike capabilities; ground combat capabilities and their support systems, including

soldier equipment and infantry weapons; small drones (NATO class 1) and related

anti-drone systems; critical infrastructure protection; cyber; and military mobility

including counter-mobility;

b. category two: air and missile defence systems; maritime surface and underwater

capabilities; drones other than small drones (NATO class 2 and 3) and related anti-

drone systems; strategic enablers such as, but not limited to, strategic airlift, air-to-air

refuelling, C4ISTAR systems as well as space assets and services; space assets

protection; artificial intelligence and electronic warfare.

3. The activities, expenditures and measures to support Ukraine’s defence industrial

capacities related to defence products or other products for defence purposes shall not

contravene the security and defence interests of the Union and its Member States as

established in the framework of the common foreign and security policy pursuant to Title

V of the Treaty on European Union, including respect for the principle of good

neighbourly relations, or the objectives set out in Article 2 of this Regulation.

4. Defence products shall be produced in compliance with the following conditions:

a. Manufacturers and subcontractors involved in the production shall be established

and have their executive management structures in the Union, in an EEA EFTA

State or in Ukraine. They shall not be subject to control by a third country which is

not an EEA EFTA State or Ukraine or by another third-country entity which is not

established in the Union, an EEA EFTA State or in Ukraine;

b. By way of derogation from point (a), in order to take into account industrial

cooperation with non-EU partners, defence products that involve a subcontractor

involved in the production which is allocated between 15 % and 35 % of the value

of the contract, and that is not established or does not have its executive

EN 23 EN

management structures in the Union, EEA EFTA State or Ukraine, shall be eligible

providing that at least one of the following conditions are met:

i. a direct contractual relationship related to the defence product has been

established between the manufacturer and that subcontractor prior to 28 May

2025;

ii. the manufacturer commits to studying, within two years, the feasibility of

replacing the input provided by that subcontractor with an alternative,

restriction-free input originating in the Union, EEA EFTA States or Ukraine,

and meeting technical and time requirements.

c. By way of derogation from point (a), defence products involving manufacturers or

subcontractors established in the Union and controlled by another third country or

by another third-country entity which is not an EEA EFTA State or Ukraine shall be

eligible if this manufacturer or subcontractor has been subject to screening within

the meaning of Regulation (EU) 2019/452 and, where necessary, to appropriate

mitigation measures, or if this manufacturer provides guarantees in accordance with

point (d) verified by the Member State in which it is established;

d. The guarantees referred to in point (c) of this paragraph shall provide assurances

that the involvement of the manufacturer or subcontractor in the production of the

defence product does not contravene the security and defence interests of the Union

and its Member States as established in the framework of the common foreign and

security policy pursuant to Title V of the Treaty on European Union. Those

guarantees shall in particular substantiate that, for the purposes of activities,

expenditures and measures, measures are in place to ensure that:

i. control over the manufacturer or subcontractor is not exercised in a manner

that restrains or restricts its ability to carry out the activities, expenditures and

measures supported; and

ii. access by a non-associated third country or by a non-associated third-country

entity to classified or sensitive information relating to the defence product

produced is prevented and the employees or other persons involved in the

production of the defence product have national security clearance issued by a

Member State, where appropriate, in accordance with national laws and

regulations.

EN 24 EN

e. The infrastructure, facilities, assets and resources of the manufacturers and

subcontractors involved in the production shall be located in the territory of a

Member State, an EEA EFTA State or Ukraine. Where manufacturers or

subcontractors involved in the production have no readily available alternatives or

relevant infrastructure, facilities, assets and resources in the territory of a Member

State, an EEA EFTA State or Ukraine, they may use their infrastructure, facilities,

assets and resources which are located or held outside those territories, provided

that such use does not contravene the security and defence interests of the Union

and its Member States;

f. Manufacturers and subcontractors involved in the production may be considered to

fulfil the eligibility conditions referred to in this paragraph where they have fulfilled

equivalent conditions under Regulations (EU) 2018/109229, (EU) 2021/69730, (EU)

2023/152531, or (EU) 2023/241832 of the European Parliament and of the Council or

under Regulation (EU) 2025/1106 and provided that no subsequent changes call

into question the fulfilment of those conditions;

g. The cost of components originating outside the Union, EEA EFTA States and

Ukraine shall not be higher than 35 % of the estimated cost of the components of

the defence product. No component shall be sourced from a third country that

contravenes the security and defence interests of the Union and its Member States;

h. For defence products related to category two as referred to in paragraph 2 of this

Article, manufacturers shall have the ability to decide, without restrictions imposed

by third countries or by third-country entities, on the definition, adaptation and

evolution of the design of the defence product procured, including the legal

29 Regulation (EU) 2018/1092 of the European Parliament and of the Council of 18 July 2018 establishing

the European Defence Industrial Development Programme aiming at supporting the competitiveness

and innovation capacity of the Union’s defence industry (OJ L 200, 7.8.2018, p. 30, ELI:

http://data.europa.eu/eli/reg/2018/1092/oj). 30 Regulation (EU) 2021/697 of the European Parliament and of the Council of 29 April 2021 establishing

the European Defence Fund and repealing Regulation (EU) 2018/1092 (OJ L 170, 12.5.2021, p. 149,

ELI: http://data.europa.eu/eli/reg/2021/697/oj). 31 Regulation (EU) 2023/1525 of the European Parliament and of the Council of 20 July 2023 on

supporting ammunition production (ASAP) (OJ L 185, 24.7.2023, p. 7, ELI:

http://data.europa.eu/eli/reg/2023/1525/oj). 32 Regulation (EU) 2023/2418 of the European Parliament and of the Council of 18 October 2023 on

establishing an instrument for the reinforcement of the European defence industry through common

procurement (EDIRPA) (OJ L, 2023/2418, 26.10.2023, ELI: http://data.europa.eu/eli/reg/2023/2418/oj).

EN 25 EN

authority to substitute or remove components that are subject to restrictions imposed

by third countries or by third-country entities;

i. For the purposes of this paragraph, ‘subcontractors involved in the production’

means any legal entity which provides critical inputs that possess unique attributes

essential for the functioning of a product, which is allocated at least 15 % of the

value of the contract, and which needs access to classified information for the

performance of the contract.

5. By way of derogation from paragraphs 2 and 4 and in full respect of paragraph 3, where

there is an urgent need for a given defence product stemming from Russia’s war of

aggression against Ukraine, the procurement of a defence product which does not

comply with one or more of the conditions set out in paragraphs 2 and 4 shall be eligible

for financial assistance under this chapter provided that:

a. there is no equivalent product that responds to that urgent need which complies with

the conditions set out in paragraphs 2 and 4 or it is not available at the required

scale; or

b. the delivery lead time for such a product is significantly shorter than for a product

which would comply with the conditions set out in paragraphs 2 and 4, even if this

product were subject to a priority rated request as referred to in Article 19.

In such a case, Ukraine shall provide the information reasonably available to it

demonstrating that the conditions for the application of this derogation are met to be

checked by the Commission without undue delay. In the context of point (b), that

information shall include a formal commitment on compliance with the delivery lead

time.

The procurement of defence products from manufacturers established in third countries

shall be made only where there are no other alternatives available in the Union under the

circumstances described in points (a) and (b).

The Commission shall approve such derogations by means of implementing acts, acting

in accordance with the examination procedure referred to in Article 27(3).

6. Where applicable, Participating Member States shall ensure that the procurement

procedures and contracts for other products for defence purposes resulting from

procurements receiving support under the Ukraine Support Loan contain appropriate

EN 26 EN

eligibility conditions to protect the security and defence interests of the Union and its

Member States.

7. By way of derogation from paragraph 4, contributions in accordance with point (e) of

paragraph 8 of this Article shall be utilised in line with the eligibility conditions of the

respective Union programme.

8. Activities, expenditures and measures related to defence products or other products for

defence purposes shall be implemented within one of the following methods of

implementation:

a. procurements by Ukraine, subject to the procurement and delivery being validated

by the Commission or Participating Member States. Ukraine shall be responsible for

such procurements in accordance with Ukrainian law, where validations by the

Commission or Participating Member States shall include on a sample basis checks

on contractual documentation, invoices and delivery certificates, physical

inspections to suppliers and physical verification of deliveries;

b. procurements by Ukraine that are a common procurement in accordance with

Regulation (EU) 2025/1106;

c. agreements between Ukraine and Member States or the European Defence Agency;

d. procurement agreements between Ukraine and international or intergovernmental

organisations;

e. contributions by Ukraine to the Ukraine Support Instrument established by [EDIP

Regulation], the Ukraine Investment Framework established by Regulation (EU)

2024/792 for dual-use goods or other Union programmes.

Activities, expenditures and measures related to other products for defence purposes may

also be implemented by procurements by Ukraine for procurements below EUR 7 000

000, provided that sound financial management and the protection of the financial

interest of the Union are ensured.

9. Contracts entered into by Ukraine relating to procurements, agreements or contributions

referred to in paragraph 8 shall be eligible if signed after 14 January 2025 provided that

they comply with the requirements set out in this Article.

10. The Commission shall be empowered to adopt a delegated act in accordance with Article

26 to supplement this Regulation by extending eligibility criteria to include third

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countries other than EEA EFTA States and Ukraine that do not contravene the security

and defence interests of the Union and its Member States, provided that such countries

have concluded an agreement with the Union in accordance with Article 17 of Council

Regulation 2025/1106.

Article 14

Product schedules

1. In respect of the approved amounts of assistance to support Ukraine’s defence industrial

capacities as referred to in Article 8(2)(a)(iii), Ukraine shall draw up a schedule for each

activity, expenditure or measure related to a defence product or other product for defence

purposes for which it intends to request assistance. That schedule shall set out:

a. a description of the defence product or other product for defence purposes;

b. information on compliance with Article 13.

2. Ukraine shall consult the schedule with the Commission with a view of ensuring

compliance with Article 13. In determining whether an alternative method of

implementation is more economical or when considering the prices available, the

Commission shall take into consideration any co-financing that is to be provided by

Member States. When proposing to Ukraine the most appropriate method of

implementation, the Commission shall take into consideration the timeliness of delivery

of the relevant product, activity, expenditure or measure, the prices available, the past

experience with that method of implementation and, where warranted, past experience

with manufacturers under that method of implementation. Should Ukraine not identify a

method of implementation in accordance with Article 13(8) or should the Commission

consider that an alternative method of implementation is more economical, efficient or

effective, the Commission may propose a method of implementation to Ukraine.

3. By derogation from paragraph 1, Ukraine shall not be required to draw up a schedule for

implementation in accordance with Article 13(8)(e).

Article 15

Ukraine’s Defence Industrial Capacities Expert Group

1. To support the implementation of assistance to support Ukraine’s defence industrial

capacities, the Commission shall establish the Ukraine’s Defence Industrial Capacities

Expert Group.

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2. In addition to representatives of the Commission services and the European External

Action Service, the Ukraine’s Defence Industrial Capacities Expert Group shall include

representatives of Participating Member States and EEA EFTA States. Ukraine shall be

invited to the meetings of the Ukraine’s Defence Industrial Capacities Expert Group as

appropriate.

3. The Ukraine’s Defence Industrial Capacities Expert Group shall provide advice,

expertise and support on the defence products and other products for defence purposes,

as well as on the method of implementation.

Article 16

Administration of the assistance to support Ukraine’s defence industrial capacities

Ukraine shall open a special account for the sole purpose of the management of the financial

and economic assistance received to support Ukraine’s defence industrial capacities. In

relation to this account:

a. all payments of the contracts or agreements that are requested for assistance to

support Ukraine’s defence industrial capacities shall be paid from this account;

b. the Commission shall be granted monitoring rights of this account;

c. Ukraine shall provide the Commission with a monthly report, to be submitted

within 10 working days of the end of each month, containing the following

information:

i. the date and amount of each payment made from the account during the

preceding month;

ii. the name of the recipient of each payment;

iii. a description of the purpose of each payment and how it relates to the contracts

or agreements submitted in requests for funds;

iv. any other information as may be reasonably requested by the Commission.

Article 17

Monitoring of implementation

1. The Commission shall monitor the implementation of assistance to support Ukraine’s

defence industrial capacities, notably including the delivery of products, in accordance

with this Article.

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2. For procurements by Ukraine in accordance with Article 13(8), point (a), that are

validated by the Commission, the Commission shall utilise the validation process therein.

3. For procurements by Ukraine in accordance with Article 13(8), point (a), that are

validated by Participating Member States, the Participating Member State shall monitor

the implementation of the procurement and the delivery in accordance with that

provision and report to the Commission.

4. For procurements by Ukraine in accordance with Article 13(8), point (b), the

Participating Member States that are part of such a common procurement shall monitor

the implementation of the procurement and the delivery and report to the Commission.

Where in the context of a common procurement under Regulation (EU) 2025/1106 a

Non-Participating Member State agrees to be bound by and to apply the eligibility rules

set out in this Regulation, ensures the protection of the financial interests of the Union

and is the contracting authority which acts on behalf of the other countries, Ukraine shall

require as a condition of its participation that the Non-Participating Member State

monitors the implementation of the procurement and the delivery and report to the

Commission.

5. For agreements between Ukraine and Participating Member States in accordance with

Article 13(8), point (c), the Participating Member State shall monitor the implementation

of the agreement and the delivery and report to the Commission. For agreements

between Ukraine and Non-Participating Member States in accordance with Article 13(8),

point (c), Ukraine shall include in such agreements obligations on the respective Non-

Participating Member State to be bound by and to apply the eligibility rules set out in

this Regulation, to ensure the protection of the financial interests of the Union and to

monitor the implementation of the agreement and the delivery and report to the

Commission.

6. For agreements between Ukraine and the European Defence Agency in accordance with

Article 13(8), point (c), the European Defence Agency shall monitor the implementation

of the agreement and the delivery and report to the Commission.

7. For procurement agreements between Ukraine and international or intergovernmental

organisations in accordance with Article 13(8), point (d), Ukraine shall include in such

procurement agreements obligations on the respective international or intergovernmental

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organisations to monitor the implementation of the procurement and the delivery and to

report to the Commission.

8. Paragraphs 1 to 7 shall not apply to procurements by Ukraine in accordance with Article

13(8) regarding activities, expenditures and measures related to other products for

defence purposes below EUR 7 000 000. However, Ukraine shall regularly report to the

Commission on how it monitors the implementation of these procurements and delivery.

The Commission shall undertake risk-based controls.

9. Should the Commission be notified by Ukraine of the non-implementation of a contract

in accordance with Article 20(2), point (g), or become aware of the non-delivery of

products under this Article or the non-use of funds in the account referred to in Article

16, the Commission shall engage with Ukraine to repurpose those funds in accordance

with the provisions of this Regulation.

Article 18

Modification of framework agreements or contracts

1. Where activities, expenditures and measures related to defence products are implemented

through the methods referred to in paragraph 8(b) or (c) of Article 13 within the Union,

the rules provided for in paragraphs 2 to 4 shall apply to an existing framework

agreement or contract that has as its object the purchase of defence products, which is

used in that implementation method, and which does not provide for the possibility to

substantially amend it. When applying paragraphs 2 and 3, the contracting authority that

concluded the framework agreement or contract shall obtain the prior agreement of the

undertaking with which it has concluded that framework agreement or contract.

2. A contracting authority of a Participating Member State may modify an existing

framework agreement or contract for defence products, where that framework agreement

or contract has been concluded with an undertaking complying with criteria equivalent to

those laid down in Article 13(4) and (5) of this Regulation, in order to add Ukraine as a

party to that framework agreement or contract.

3. By way of derogation from Article 29(2), third subparagraph, of Directive 2009/81/EC, a

contracting authority of a Participating Member State may make substantial amendments

to the quantities set out in a framework agreement or contract, with an estimated value

above the thresholds laid down in Article 8 of Directive 2009/81/EC, where that

framework agreement or contract has been concluded with an undertaking that complies

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with criteria equivalent to those laid down in Article 13(4) and (5) of this Regulation,

and insofar as the modification is strictly necessary for the application of paragraph 2 of

this Article.

4. For the purpose of calculating the value referred to in paragraph 3, the updated value

shall be the reference point when the contract includes an indexation clause.

5. A contracting authority which has modified a framework agreement or contract in the

cases referred to in paragraph 2 or 3 of this Article shall publish a notice to that effect in

the Official Journal of the European Union in accordance with Article 32 of Directive

2009/81/EC.

6. In the cases referred to in paragraphs 2 and 3, the principle of equal rights and

obligations shall apply between the contracting authorities which are party to the

framework agreement or contract, in particular regarding the cost of additional quantities

procured.

Article 19

Voluntary prioritisation of defence products

1. For the sole purpose of this Regulation and where Ukraine is confronted with severe

difficulties in the placing or in the execution of a contract for the supply of defence

products that are urgently needed and meet the eligibility requirements set out in Article

13(4) or (5), an economic operator together with the Participating Member State on the

territory of which its production site is located may jointly submit a request to the

Commission to issue a prioritisation measure to prioritise a certain order of such products

manufactured by that economic operator.

2. The joint request referred to in paragraph 1 shall include the following elements:

a. The initial request from Ukraine;

b. The list of products to be subject to the prioritisation measure, their specifications

and the quantities in which they are to be supplied;

c. The time limits within which the delivery of these products is to be completed;

d. Evidence that the economic operator cannot meet the request from Ukraine referred

to in point (a) without a prioritisation measure;

e. An indication of a fair and reasonable price at which the prioritisation measure

could be placed as well as elements substantiating that price.

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3. Upon reception of a request as referred to in paragraph 1, the Commission shall assess

that request without undue delay.

4. The Commission shall base its assessment referred to in paragraph 3 on objective,

factual, measurable and substantiated data, with the aim of determining whether such

prioritisation is indispensable in order to address the severe difficulties referred to in

paragraph 1.

5. Where the assessment referred to in paragraph 3 concludes that the prioritisation is

indispensable, the Commission, by means of an implementing act, shall adopt a

prioritisation measure setting out:

a. the legal basis of the priority-rated request to be complied with by the economic

operator;

b. the list of products subject to the priority-rated request, their specifications and the

quantities in which they are to be supplied;

c. the time limits within which the priority-rated request is to be completed;

d. the beneficiaries of the priority-rated request;

e. the scope of contractual obligations over which the priority-rated request shall have

precedence;

f. the waiver of contractual liability under the conditions laid down in paragraph 7 of

this Article; and

g. the penalties provided for in paragraphs 12 to 18 of this Article for non-compliance

with the obligations stemming from that implementing act.

The implementing act referred to in the first subparagraph of this paragraph shall be

adopted in accordance with the examination procedure referred to in Article 27(3).

6. The prioritisation measure referred to in paragraph 5 shall:

a. be placed at a fair and reasonable price, adequately taking into account the

economic operator’s opportunity costs when fulfilling the prioritisation measure as

compared to existing contractual obligations; and

b. take precedence over any contractual obligations under private or public law related

to the defence products subject to the prioritisation measure, under the conditions

laid down in the implementing act referred to in paragraph 5.

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7. The economic operator subject to a prioritisation measure pursuant to paragraph 5 shall

not be liable for any breach of contractual obligation that is governed by the law of a

Participating Member State, provided that:

a. the breach of contractual obligation is strictly necessary for compliance with the

required prioritisation;

b. the implementing act referred to in paragraph 5 has been complied with; and

c. the request referred to in paragraph 1 did not have the sole purpose of unduly

avoiding a prior performance obligation under private or public law.

8. The economic operator subject to a prioritisation measure may request the Commission

to modify the implementing act referred to in paragraph 5 where it considers it to be duly

justified based on one of the following grounds:

a. the economic operator is unable to perform the prioritisation measure on account of

insufficient production capability or production capacity, even under preferential

treatment of the request;

b. completion of the prioritisation measure would place an unreasonable economic

burden on, and entail particular hardship for, the economic operator.

9. The economic operator shall provide all relevant and substantiated information to allow

the Commission to assess the merits of the request for modification referred to in

paragraph 8.

10. Based on the examination of the reasons and evidence provided by the economic

operator, the Commission may, after consultation and prior agreement of the

Participating Member State on the territory of which the relevant production site of the

economic operator concerned is located, amend its implementing act to release, partially

or in totality, the economic operator concerned from its obligations under this Article.

11. Where an economic operator, after having expressly accepted to prioritise the orders

requested by the Commission, intentionally or through gross negligence does not comply

with the obligation to prioritise those orders, it shall be subject to fines set out in

paragraphs 12 to 18 of this Article, except where:

a. the economic operator is unable to perform the priority-rated request on account of

insufficient production capability or production capacity, or on technical grounds;

or

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b. performance or completion of the request would place an unreasonable economic

burden on, and entail particular hardship for, the economic operator, including

substantial risks relating to business continuity.

The revenue from the fines shall constitute external assigned revenue within the

meaning of Article 21(5) of the Regulation (EU, Euratom) 2024/2509 to an external

assistance programme under which Ukraine is eligible.

12. Where it deems it to be necessary and proportionate, the Commission may, by way of

implementing acts, impose on the economic operators fines not exceeding EUR 300 000

where the economic operator, intentionally or through gross negligence, does not comply

with the obligation to perform the priority-rated request pursuant to this Article.

The implementing acts referred to in the first subparagraph of this paragraph shall be

adopted in accordance with the examination procedure referred to in Article 27(3).

13. Before taking a decision pursuant to paragraph 12, the Commission shall provide an

opportunity for the economic operator concerned to be heard in accordance with

paragraph 15. The Commission shall take into account any duly reasoned justification

presented by the economic operator for the purpose of determining whether fines are

deemed necessary and proportionate.

14. In fixing the amount of the fine, the Commission shall take into consideration the nature,

gravity and duration of the infringement, including whether the economic operator has

partially complied with the priority-rated order or the priority-rated request.

15. Before adopting a decision pursuant to paragraph 12, the Commission shall ensure that

the economic operators concerned have been given the opportunity to submit

observations on:

a. the preliminary findings of the Commission, including any matter in relation to

which the Commission has raised objections;

b. the measures that the Commission may intend to take in view of the preliminary

findings pursuant to point (a) of this paragraph.

16. The economic operators concerned may submit to the Commission their observations on

the Commission’s preliminary findings within a time limit which shall be fixed by the

Commission in its preliminary findings, and which may not be less than 14 working

days.

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17. The Commission shall base its imposition of fines only on objections on which the

economic operators concerned have been able to comment.

18. Where the Commission has informed the economic operators concerned of its

preliminary findings as referred to in paragraph 15, it shall give access, if so requested,

to the Commission's file under the terms of a negotiated disclosure, subject to the

legitimate interest of economic operators in the protection of their business secrets, or in

order to preserve business secrets or other confidential information of any person. The

right of access to the file shall not extend to confidential information and internal

documents of the Commission or the authorities of the Participating Member States, in

particular to correspondence between the Commission and the authorities of the

Participating Member States. Nothing in this paragraph shall prevent the Commission

from disclosing and using information necessary to prove an infringement.

19. This Article is without prejudice to the rights of the Participating Member States to

protect their essential security interests in accordance with Article 346(1)(b) TFEU.

CHAPTER V

FINANCING AND IMPLEMENTATION

Article 20

Ukraine Support Loan Agreement

1. The detailed financial terms of the Ukraine Support Loan shall be laid down in the

Ukraine Support Loan Agreement.

2. In addition to the elements laid down in Article 223(4) of Regulation (EU, Euratom)

2024/2509, the Ukraine Support Loan Agreement shall require that:

(a) the Ukraine Support Loan shall be a limited recourse loan that shall become

due and payable upon the occurrence of a repayment trigger as defined in

subparagraph (j);

(b) Ukraine shall provide the Union a security interest over its claim on Russia for

reparations as security for the Ukraine Support Loan. The value of that security

interest shall at any given time be equal to the value of disbursed funds under

the Ukraine Support Loan;

(c) the rights, responsibilities and obligation provided for in the framework

agreement under the Ukraine Facility referred to in Article 9 of Regulation

(EU) 2024/792 apply to this Ukraine Support Loan Agreement and the funds

therein;

(d) the amount of assistance referred to in Article 8(2)(a)(i) shall be implemented

in accordance with Chapter III of Regulation (EU) 2024/792, with the

exception of rules on the duration and repayment of the loan, including

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borrowing cost subsidy, which shall be governed by the rules of this

Regulation;

(e) Ukraine utilises the same management and control systems as proposed in the

Ukraine Plan established under Regulation (EU) 2024/792, including beyond

the availability period referred to in Article 6(2) in that Regulation;

(f) the Commission have the right to monitor activities, expenditures and measures

under Chapter IV of this Regulation that are carried out by the Ukrainian

authorities, along the whole project cycle;

(g) Ukraine immediately notify the Commission should a draft contract or

agreement financed through the Ukraine Support Loan not be implemented;

(h) Ukraine continues to respect the precondition set out in Article 5(1);

(i) Ukraine does not reverse any measure taken under any other current or

previous instruments of support provided by the Union or IMF concerning anti-

corruption;

(j) Ukraine shall be liable for the repayment of the principal of the Ukraine

Support Loan within 30 days, if any of the following conditions are fulfilled,

each constituting a repayment trigger for the purposes of this Regulation:

i. the receipt of cash by Ukraine for war reparations, indemnities or any

financial settlement from Russia, up to the amount of such settlement; or

ii. 90 days from the receipt of non-monetary assets by Ukraine for war

reparations, indemnities or any financial settlement from Russia, except

territory, up to the amount of such settlement which shall be determined by an

independent valuation. Upon request of Ukraine, the Commission may grant an

extension of this timeframe if strictly warranted; or

iii. that Ukraine is in breach of subparagraph (h); or

iv. it has been established that, in relation to the management of the

Ukraine Support Loan, Ukraine has engaged in any act of fraud, corruption or

any other illegal activity detrimental to the financial interests of the Union.

(k) Ukraine is liable to repay the Ukraine Support Loan:

i. in the event of subparagraph (j), points (i) and (ii), for an amount of the

monetary value of the war reparations, indemnities or any financial settlement

from Russia equal to the proportion of the Ukraine Support Loan outstanding

against the sum of the value of the Ukraine Support Loan outstanding, any

outstanding reparations loans provided by G7 members and any outstanding

liabilities under ERA Loans;

ii. in the event of subparagraph (j), point (iii), for the total outstanding

amount of the Ukraine Support Loan;

iii. in the event of subparagraph (j), point (iv), for the value of fraud,

corruption or any other illegal activity detrimental to the financial interests of

the Union.

(l) any amounts of the Ukraine Support Loan not covered by the liability referred

to in subparagraph (k) shall remain in place until future repayment trigger

events occur;

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(m) in case of payments or recoveries, Ukraine shall indicate the relevant payments

from the Ukraine Support Loan that are being repaid or recovered;

(n) the Union have the right to make use of Russian assets immobilised in the

Union to repay the loan, in full accordance with Union and international law;

(o) Ukraine shall ensure that the procurement procedures and contracts for other

products for defence purpose resulting from procurement receiving support

under the Ukraine Support Loan contain appropriate eligibility conditions to

protect the security and defence interests of the Union and its Member States.

The Ukraine Support Loan Agreement shall also include any other requirements

needed for the implementation of the Ukraine Support Loan, including those

necessary to implement Article 17 of this Regulation.

3. Non-compliance with the terms of the Ukraine Support Loan Agreement shall constitute

a ground for the Commission to suspend or cancel, in full or in part, the release of the

instalment or tranches. Non-compliance with repayment terms of the Ukraine Support

Loan Agreement shall additionally constitute a ground for the total or part of the

outstanding amount of the Ukraine Support Loan to become due and payable.

4. The Ukraine Support Loan Agreement shall be made available, upon request,

simultaneously to the European Parliament and to the Council.

Article 21

Request for funds

1. To receive financial and economic assistance, Ukraine shall submit to the Commission a

duly justified request for funds. Such a request for funds may be submitted by Ukraine to

the Commission, in principle, six times a year. For budget assistance in the form of a

loan to be implemented pursuant to Chapter III of Regulation (EU) 2024/792, the request

for funds shall be submitted in accordance with Chapter III of Regulation (EU)

2024/792.

2. For macro-financial assistance, the request for funds shall be accompanied by a report in

accordance with the provisions of the MoU.

3. For assistance to support Ukraine’s defence industrial capacities:

(a) the request for funds may cover multiple products. For each covered product,

the request for funds shall contain a contract or agreement in compliance with Article

13 and a schedule in accordance with Article 14. Such contracts or agreements may

be signed or in a finalised draft form;

(b) if the request for funds requests funding for an amount greater than 20% of the

amount made accessible in accordance with the Council implementing decision

referred to in Article 8, Ukraine shall provide a detailed justification, including on

the impact for future requests for funds under that decision.

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Article 22

Borrowing costs subsidy

1. By way of derogation from Article 223(4), point (e), of Regulation (EU, Euratom)

2024/2509 and subject to available resources, the Union may bear the costs arising from

the borrowing for a loan to Ukraine that would otherwise be borne by Ukraine

(‘borrowing costs subsidy’). These costs comprise service costs (cost of funding, cost of

liquidity management, and cost of service for administrative overheads related to the

borrowing and lending).

2. Ukraine may request the borrowing costs subsidy referred to in paragraph 1 each year.

The Commission may award the borrowing costs subsidy for an amount not exceeding

the limits of the appropriations made available in the context of the budgetary procedure.

Article 23

Decision on the release of assistance

1. The Commission shall decide on the release of assistance subject to its assessment of the

following requirements:

(a) for macro-financial assistance:

i. compliance with the precondition set out in Article 5(1);

ii. the satisfactory fulfilment of the policy conditions set out in the MoU

referred to in Article 11; and

iii. compliance with the Ukraine Support Loan Agreement referred to in

Article 20.

(b) for assistance to support Ukraine’s defence industrial capacities:

i. compliance with the precondition set out in Article 5(1);

ii. confirmation that the contracts or agreements are for products in

compliance with Article 13 and that the Commission does not object to the

methods of implementation;

iii. confirmation that Ukraine broadly respects the qualitative and

quantitative steps contained in the Annex to Implementing Decision (EU)

2024/1447 and any amendments thereto;

iv. compliance with the obligations referred to in Article 16 and the

Ukraine Support Loan Agreement referred to in Article 20; and

v. to the extent necessary, the adequacy of the detailed justification of

Ukraine, taking into account the situation in Ukraine and the committed and

expected external financing available.

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For budget assistance in the form of a loan to be implemented pursuant to Chapter III of

Regulation (EU) 2024/792, the release of assistance shall be implemented in accordance

with Chapter III of Regulation (EU) 2024/792.

2. Subject to compliance with the amount of assistance accessible provided for in the

Council implementing decision adopted in accordance with Article 8, where the

Commission makes a positive assessment of the request for funds, it shall adopt, without

undue delay, a decision authorising the disbursement of the Ukraine Support Loan. For

assistance to support Ukraine’s defence industrial capacities, that amount to be disbursed

shall be equal to the value of the contracts or agreements included in the request for

funds.

3. The Commission may proceed with the decision referred to in paragraph 2 for points (a)

and (b) under paragraph 1 collectively or individually.

4. Where the Commission gives a negative assessment to the request for funds, it shall,

without undue delay, inform Ukraine, giving reasons for its assessment. A negative

assessment shall not prevent Ukraine from submitting a new request for funds.

Article 24

Financing of the Ukraine Support Loan

1. In order to finance the assistance under the Ukraine Support Loan, the Commission shall

be empowered, on behalf of the Union, to borrow the necessary funds on the capital

markets or from financial institutions under the diversified funding strategy referred to in

Article 224 of Regulation (EU, Euratom) 2024/2509.

2. The borrowing and lending operations for the Ukraine Support Loan shall be carried out

in euro.

3. By way of derogation from Article 31(3), second sentence, of Regulation (EU) 2021/947,

the financial assistance provided to Ukraine under the Ukraine Support Loan shall not be

supported by the External Action Guarantee. No provisioning for the Ukraine Support

Loan shall be constituted and, by way of derogation from Article 214(1) of Regulation

(EU, Euratom) 2024/2509, no provisioning rate shall be set.

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Article 25

Application of the rules on classified information and sensitive information

1. Classified information that is created, handled, stored, exchanged or shared under this

Regulation shall be protected in accordance with the security rules set out in Commission

Decision (EU, Euratom) 2015/44433 or the Agreement between the Member States of the

European Union, meeting within the Council, regarding the protection of classified

information exchanged in the interests of the European Union, as appropriate.

2. The Commission shall use a secured exchange system in order to facilitate the exchange

of classified information and sensitive information between the Commission and Ukraine

and, where appropriate, with the Participating Member States.

3. The Commission shall have access to information, including classified information,

necessary for the tasks assigned to it under this Regulation, in particular for the purpose

of verifying the conditions for disbursement of payments and carrying out the checks,

reviews, audits, investigations, reports as well as the controls and audits, as referred to in

Article 20.

4. Information received as a result of the application of this Regulation shall be used only

for the purpose for which it was requested.

5. The Commission and Participating Member States shall ensure the protection of trade

and business secrets and other sensitive information acquired and generated in

application of this Regulation in accordance with Union law and respective national law.

CHAPTER VI

FINAL PROVISIONS

Article 26

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the

conditions laid down in this Article.

2. The power to adopt delegated acts referred to in Article 13 shall be conferred on the

Commission for an indeterminate period of time from seven days after the entry into

force of this Regulation.

33 Commission Decision (EU, Euratom) 2015/444 of 13 March 2015 on the security rules for protecting

EU classified information (OJ L 72, 17.3.2015, p. 53, ELI: http://data.europa.eu/eli/dec/2015/444/oj).

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3. The delegation of power referred to in Article 13 may be revoked at any time by the

European Parliament or by the Council. A decision to revoke shall put an end to the

delegation of the power specified in that decision. It shall take effect on the day

following the publication of the decision in the Official Journal of the European Union or

at a later date specified therein. It shall not affect the validity of any delegated acts

already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by

each Member State in accordance with the principles laid down in the Interinstitutional

Agreement of 13 April 2016 on Better Law-Making.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the

European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 13 shall enter into force only if no objection

has been expressed either by the European Parliament or by the Council within a period

of two months of notification of that act to the European Parliament and the Council or

if, before the expiry of that period, the European Parliament and the Council have both

informed the Commission that they will not object. That period shall be extended by two

months at the initiative of the European Parliament or of the Council.

Article 27

Committee procedure

1. The Commission shall be assisted by a committee. That committee shall be a committee

within the meaning of Regulation (EU) No 182/2011.

2. The EDA shall be invited to provide its views and expertise to the committee as an

observer. The EEAS shall also be invited to assist in the work of the committee.

3. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011

shall apply.

Article 28

Ukraine Support Loan dialogue

1. In order to enhance the dialogue between the Union institutions, in particular the

European Parliament, the Council and the Commission, and to ensure greater

transparency and accountability, the competent committee of the European Parliament

may invite the Commission to discuss the implementation of this Regulation.

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2. The European Parliament may express its views in resolutions as regards the Ukraine

Support Loan.

3. The Commission shall take into account any elements arising from the views expressed

through the Ukraine Support Loan dialogue, including the resolutions from the European

Parliament if provided.

Article 29

Information to the European Parliament and to the Council

1. The Commission shall inform the European Parliament and the Council of

developments regarding the implementation of this Regulation, including Article 4(4), Article

6(1), Article 7(5), Article 11(4), Article 20(3) and Article 23(2) and shall provide those

institutions with the relevant documents without undue delay. Information transmitted by the

Commission to the Council in the context of this Regulation or its implementation shall

simultaneously be made available to the European Parliament, subject to confidentiality

arrangements if necessary.

2. By 30 June 2027 and 30 June 2028, the Commission shall submit to the European

Parliament and to the Council a report on the implementation of this Regulation in the

preceding year, including an evaluation of that implementation. That report shall:

(a) examine progress made in implementing the Ukraine Support Loan;

(b) provide information on the monitoring referred to in Article 17; and

(c) assess the economic situation and prospects of Ukraine, as well as progress

made in implementing the policy conditions referred to in Article 11(1).

3. By 30 June 2029, the Commission shall submit to the European Parliament and to the

Council an evaluation report, assessing the results and efficiency of the Ukraine Support Loan

provided under this Regulation and the extent to which it has contributed to the aims of the

assistance.

Article 30

Entry into force

This Regulation shall enter into force on the day following that of its publication in the

Official Journal of the European Union.

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For those Member States which participate in enhanced cooperation by virtue of a decision

adopted pursuant to Article 331(1) TFEU, second or third subparagraph, this Regulation shall

apply as from the date indicated in the decision concerned.

This Regulation shall be binding in its entirety and directly applicable in the participating

Member States in accordance with the Treaties.

Done at Brussels,

For the European Parliament For the Council

The President The President

EN 44 EN

LEGISLATIVE FINANCIAL AND DIGITAL STATEMENT

1. FRAMEWORK OF THE PROPOSAL/INITIATIVE ................................................. 3

1.1. Title of the proposal/initiative ...................................................................................... 3

1.2. Policy area(s) concerned .............................................................................................. 3

1.3. Objective(s) .................................................................................................................. 3

1.3.1. General objective(s) ..................................................................................................... 3

1.3.2. Specific objective(s) ..................................................................................................... 3

1.3.3. Expected result(s) and impact ...................................................................................... 3

1.3.4. Indicators of performance ............................................................................................ 3

1.4. The proposal/initiative relates to: ................................................................................. 4

1.5. Grounds for the proposal/initiative .............................................................................. 4

1.5.1. Requirement(s) to be met in the short or long term including a detailed timeline for

roll-out of the implementation of the initiative ............................................................ 4

1.5.2. Added value of EU involvement (it may result from different factors, e.g.

coordination gains, legal certainty, greater effectiveness or complementarities). For

the purposes of this section 'added value of EU involvement' is the value resulting

from EU action, that is additional to the value that would have been otherwise

created by Member States alone. ................................................................................. 4

1.5.3. Lessons learned from similar experiences in the past .................................................. 4

1.5.4. Compatibility with the multiannual financial framework and possible synergies with

other appropriate instruments ....................................................................................... 5

1.5.5. Assessment of the different available financing options, including scope for

redeployment ................................................................................................................ 5

1.6. Duration of the proposal/initiative and of its financial impact .................................... 6

1.7. Method(s) of budget implementation planned ............................................................. 6

2. MANAGEMENT MEASURES................................................................................... 8

2.1. Monitoring and reporting rules .................................................................................... 8

2.2. Management and control system(s) ............................................................................. 8

2.2.1. Justification of the budget implementation method(s), the funding implementation

mechanism(s), the payment modalities and the control strategy proposed .................. 8

2.2.2. Information concerning the risks identified and the internal control system(s) set up

to mitigate them............................................................................................................ 8

2.2.3. Estimation and justification of the cost-effectiveness of the controls (ratio between

the control costs and the value of the related funds managed), and assessment of the

expected levels of risk of error (at payment & at closure) ........................................... 8

2.3. Measures to prevent fraud and irregularities ................................................................ 9

3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE ............ 10

3.1. Heading(s) of the multiannual financial framework and expenditure budget line(s)

affected ....................................................................................................................... 10

EN 45 EN

3.2. Estimated financial impact of the proposal on appropriations ................................... 12

3.2.1. Summary of estimated impact on operational appropriations.................................... 12

3.2.1.1. Appropriations from voted budget ............................................................................. 12

3.2.1.2. Appropriations from external assigned revenues ....................................................... 17

3.2.2. Estimated output funded from operational appropriations......................................... 22

3.2.3. Summary of estimated impact on administrative appropriations ............................... 24

3.2.3.1. Appropriations from voted budget .............................................................................. 24

3.2.3.2. Appropriations from external assigned revenues ....................................................... 24

3.2.3.3. Total appropriations ................................................................................................... 24

3.2.4. Estimated requirements of human resources.............................................................. 25

3.2.4.1. Financed from voted budget....................................................................................... 25

3.2.4.2. Financed from external assigned revenues ................................................................ 26

3.2.4.3. Total requirements of human resources ..................................................................... 26

3.2.5. Overview of estimated impact on digital technology-related investments ................ 28

3.2.6. Compatibility with the current multiannual financial framework.............................. 28

3.2.7. Third-party contributions ........................................................................................... 28

3.3. Estimated impact on revenue ..................................................................................... 29

4. DIGITAL DIMENSIONS .......................................................................................... 29

4.1. Requirements of digital relevance .............................................................................. 30

4.2. Data ............................................................................................................................ 30

4.3. Digital solutions ......................................................................................................... 31

4.4. Interoperability assessment ........................................................................................ 31

4.5. Measures to support digital implementation .............................................................. 32

EN 46 EN

1. FRAMEWORK OF THE PROPOSAL/INITIATIVE

1.1. Title of the proposal/initiative

Proposal for a Regulation of the European Parliament and of the Council

implementing enhanced cooperation on the establishment of the Ukraine Support

Loan for 2026 and 2027.

1.2. Policy area(s) concerned

Economic and Financial Affairs as well as support to the Defence Industry.

1.3. Objective(s)

1.3.1. General objective(s)

To establish the Ukraine Support Loan and make available to Ukraine financial and

economic assistance with a view to supporting Ukraine in covering its financing

needs for 2026 and 2027 notably resulting from Russia’s war of aggression and

Russia’s non-payment of reparations due. The Ukraine Support Loan shall provide

financial and economic assistance to Ukraine in a predictable, continuous, orderly,

flexible and timely manner.

1.3.2. Specific objective(s)

To support macro-financial stability in Ukraine by easing its external and internal

financing constraints, and to support Ukraine’s defence industrial capacities through

economic, financial and technical cooperation.

1.3.3. Expected result(s) and impact

Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted.

Ukraine will be provided with sufficient and continuous financial support for 2026

and 2027 in response to and following the current crisis situation. The Ukraine

Support loan is expected to help support Ukraine’s budgetary and defence needs for

the immediate future.

1.3.4. Indicators of performance

Specify the indicators for monitoring progress and achievements.

The authorities of Ukraine will be required to regularly report on the implementation

of previously granted assistance under the Ukraine Support Loan. The Commission

services will remain in close contact with the Ukraine Donor Platform to benefit

from insights from ongoing activities of the respective donors.

As regards the objective on easing financing constraints, the authorities of Ukraine

will be required to provide a report on the compliance with the agreed policy

conditions ahead of the disbursement of the instalment of the macro-financial

assistance. The Commission services will continue to monitor public finance

management, following the operational assessment of the financial circuits and

administrative procedures in Ukraine, which was delivered in June 2020, where an

update will be undertaken.

An annual report on the implementation of this Regulation to the European

Parliament and Council is foreseen. An ex-post evaluation of the Ukraine Support

Loan will be carried out by the Commission.

EN 47 EN

1.4. The proposal/initiative relates to:

☒ a new action

¨ a new action following a pilot project / preparatory action34

¨ the extension of an existing action

¨ a merger or redirection of one or more actions towards another/a new action

1.5. Grounds for the proposal/initiative

1.5.1. Requirement(s) to be met in the short or long term including a detailed timeline for

roll-out of the implementation of the initiative

For the implementation of the Ukraine Support Loan, the Commission will enter into

a Ukraine Support Loan Agreement with Ukraine detailing the financial terms of the

Ukraine Support Loan.

Once the Ukraine Support Loan Agreement is in place, the disbursements from the

Ukraine Support Loan will be conditional on the submission and positive assessment

of a Ukrainian Financing Strategy. Furthermore, for budget assistance, a

memorandum of understanding (MoU) must be agreed between the Commission and

the authorities of Ukraine for macro-financial assistance and the Ukraine Plan

updated under the Ukraine Facility. Disbursements will then be conditional upon

relevant conditions for both budget assistance and assistance to support Ukraine’s

defence industrial capacities.

The Ukraine Support Loan will be managed by the Commission. Specific provisions

on the prevention of fraud and other irregularities, consistent with the Financial

Regulation, are applicable, including the relevant provisions on ensuring the Union’s

financial interest as laid down in the Framework Agreement under Regulation (EU)

2024/792. The Commission and the Ukrainian authorities would agree on the MoU

setting out reporting requirements.

1.5.2. Added value of EU involvement (it may result from different factors, e.g.

coordination gains, legal certainty, greater effectiveness or complementarities). For

the purposes of this section 'added value of EU involvement' is the value resulting

from EU action, that is additional to the value that would have been otherwise

created by Member States alone.

Reasons for action at EU level (ex-ante): This proposal responds to the need for a

common response in providing support to Ukraine on an adequate scale, which

cannot be sufficiently achieved by the Member States alone and can be better

achieved by the EU. The main reasons are the fiscal capacity and budgetary

constraints faced at the national level and the need for strong coordination in order to

maximise the scale and effectiveness of the support, while limiting the burden on the

administrative capacity of Ukrainian authorities, which is very stretched in the

current circumstances.

The initiative is part of the EU’s objective to provide support to Ukraine and

reinforces actions by the Union for economic and defence support, as well as the

Union’s initiatives to coordinate multilateral actions.

34 As referred to in Article 58(2), point (a) or (b) of the Financial Regulation.

EN 48 EN

Expected generated EU added value (ex-post): The expected EU added value,

notably in comparison to other EU instruments, is to swiftly support macro-financial

stability via easing Ukraine’s external and internal financing constraints and to

support Ukraine’s defence industrial capacities - within an appropriate framework for

reporting requirements.

1.5.3. Lessons learned from similar experiences in the past

Previous macro-financial assistance operations to Ukraine are subject to ex-post

evaluation. Past ex-post evaluations of previous macro-financial assistance

operations to Ukraine have shown that in general they were highly relevant in terms

of its objectives, budget and policy objectives. They proved crucial to support

Ukraine in addressing its balance-of-payment problems and implementing key

structural reforms to stabilise the economy and enhance the sustainability of its

external position. They allowed for fiscal savings and financial benefits, as well as

acted as a catalyst for additional financial support and investor confidence.

1.5.4. Compatibility with the multiannual financial framework and possible synergies with

other appropriate instruments

The resources for the Ukraine Support Loan will be financed by borrowing under the

diversified funding strategy referred to in Article 224 of Regulation (EU, Euratom)

2024/2509. In considering the financial risks and the budgetary coverage, no

provisioning should be constituted for the support in the form of loans under this

Regulation, to be guaranteed over and above the ceilings, and, by way of derogation

from Article 214(1) of Regulation (EU, Euratom) 2024/2509, no provisioning rate

should be set.

With a view to providing support to Ukraine on a highly concessional basis, the

Union budget will provide for a subsidy for the costs arising from borrowing for a

loan to Ukraine that would otherwise have to be borne by Ukraine. These costs

include debt service costs (cost of funding and costs of issuing and managing

liquidity) and the associated administrative costs. The debt service costs will be

covered by a dedicated special instrument over and above the ceilings of the

Multiannual Financial Framework, in line with an accompanying proposal to amend

Regulation 2020/2093. When mobilising it in the framework of the budgetary

procedure, budgetary availabilities in other special instruments, applicable sectoral

rules, any legal or other obligations including under the EURI Instrument, priorities,

prudent budgeting and sound financial management will be considered.

A new budget line will be created to clearly and transparently identify the

expenditure related to the debt service costs resulting from the enhanced cooperation.

Administrative costs will be borne by the Union budget with staff costs being

covered by Heading 7 of the Multiannual Financial Framework.

1.5.5. Assessment of the different available financing options, including scope for

redeployment

On 23 October 2025, 26 Member States invited the Commission to present, as soon

as possible, options for financial support to Ukraine. The Commission presented a

number of options, where on 18 December 2025 the European Council agreed to

provide a loan to Ukraine of EUR 90 billion for the years 2026-2027 based on EU

borrowing on the capital markets backed by the EU budget headroom.

EN 49 EN

1.6. Duration of the proposal/initiative and of its financial impact

☒ limited duration

– ☒ financial impact from 2026 to 2027 for commitment appropriations and from

2026 to 2028 for payment appropriations.

In addition, an interest rate subsidy to Ukraine may be provided annually over

the duration of the loan.

 unlimited duration

1.7. Method(s) of budget implementation planned

☒ Direct management by the Commission

– ☒ by its departments, including by its staff in the Union delegations;

–  by the executive agencies

 Shared management with the Member States

 Indirect management by entrusting budget implementation tasks to:

–  third countries or the bodies they have designated

–  international organisations and their agencies (to be specified)

–  the European Investment Bank and the European Investment Fund

–  bodies referred to in Articles 70 and 71 of the Financial Regulation

–  public law bodies

–  bodies governed by private law with a public service mission to the extent that

they are provided with adequate financial guarantees

–  bodies governed by the private law of a Member State that are entrusted with

the implementation of a public-private partnership and that are provided with

adequate financial guarantees

–  bodies or persons entrusted with the implementation of specific actions in the

common foreign and security policy pursuant to Title V of the Treaty on

European Union, and identified in the relevant basic act

– bodies established in a Member State, governed by the private law of a

Member State or Union law and eligible to be entrusted, in accordance with

sector-specific rules, with the implementation of Union funds or budgetary

guarantees, to the extent that such bodies are controlled by public law bodies or

by bodies governed by private law with a public service mission, and are provided

with adequate financial guarantees in the form of joint and several liability by the

controlling bodies or equivalent financial guarantees and which may be, for each

action, limited to the maximum amount of the Union support.

Comments

N/A

EN 50 EN

2. MANAGEMENT MEASURES

2.1. Monitoring and reporting rules

The monitoring and reporting obligations under Regulation (EU, Euratom)

2024/2509 apply.

The monitoring of the action by the Commission services will take place based on

the implementation of previously granted assistance under the Ukraine Support Loan.

Furthermore, the monitoring of the action will take into consideration the specific

measures to be agreed with the Ukrainian authorities in the MoU. The Commission

will verify the fulfilment of the policy conditions set out in the MoU. The

Commission will inform the European Parliament and the Council about the results

of that verification.

Finally, the monitoring of the action will take into consideration the engagement with

the Ukrainian authorities, including the respective requests for funds and the

information contained therein, regarding the assistance to support Ukraine’s defence

industrial capacities.

In order to ensure that the European Parliament and the Council are able to follow

the implementation of this Regulation, the Commission should regularly inform them

of developments relating to Union assistance to Ukraine under this Regulation and

provide them with the relevant documents.

The Commission should regularly review the adequacy of such reporting and

monitoring requirements and report to the European Parliament and to the Council

thereon, thereby guaranteeing transparency and accountability.

No later than 30 June 2029, the Commission will submit to the European Parliament

and to the Council an ex-post evaluation report, assessing the results and efficiency

of the Ukraine Support Loan provided under this Regulation and the extent to which

it has contributed to the aims of the assistance.

2.2. Management and control system(s)

2.2.1. Justification of the budget implementation method(s), the funding implementation

mechanism(s), the payment modalities and the control strategy proposed

The actions to be financed under this proposal will be implemented under direct

management by the Commission. The financial support under the Ukraine Support

Loan will be made available by the Commission. The release of funds can be

organised swiftly to start in the course of 2026 and be completed in 2028 at the latest.

2.2.2. Information concerning the risks identified and the internal control system(s) set up

to mitigate them

The Commission shall have access to information, including classified information,

strictly necessary for the tasks assigned to it under this Regulation, in particular for

the purpose of verifying the conditions for disbursement of payments and carrying

out the checks, reviews, audits, investigations, reports as well as the controls and

audits, as referred to in Article 20.

To protect the Union’s financial interests linked to the Ukraine Support Loan, the

Ukraine Support Loan Agreement to be concluded between the Commission and the

Ukrainian authorities should contain provisions aligned with the rights,

EN 51 EN

responsibilities and obligations provided for in the framework agreement under the

Ukraine Facility. Ukraine will utilise the same management and control systems as

proposed in the Ukraine Plan established under Regulation (EU) 2024/792.

Ukraine will be required to provide monthly reports providing information covering

all payments. It will open a special account for the sole purpose of the management

of the financial and economic assistance received to support Ukraine’s defence

industrial capacities. All payments of the contracts or agreements that are requested

for assistance to support Ukraine’s defence industrial capacities will be paid from

this account. The Commission will be granted monitoring rights of this account.

Additionally, if it has been established that Ukraine has engaged in acts of fraud,

corruption or other illegal activity with respect to the management of the Ukraine

Support Loan, to the detriment of the Union’s financial interests, the Union can

demand early repayment of the Ukraine Support Loan.

In order to address the risks related to information confidentiality, classified

information that is created, handled, stored, exchanged or shared under this

Regulation should be protected in accordance with the security rules set out in

Commission Decision (EU, Euratom) 2015/444 or the Agreement between the

Member States of the European Union, meeting within the Council, regarding the

protection of classified information exchanged in the interests of the European

Union, as appropriate. The Commission should use a secured exchange system in

order to facilitate the exchange of classified information and sensitive information

between the Commission and Ukraine and, where appropriate, with the Participating

Member States.

2.2.3. Estimation and justification of the cost-effectiveness of the controls (ratio

between the control costs and the value of the related funds managed), and

assessment of the expected levels of risk of error (at payment & at closure)

The control systems in place have ensured an effective error rate for the macro-

financial assistance type of payments so far of 0%. There are no known cases of

fraud, corruption or illegal activity. Operations have a clear intervention logic, one

that allows the Commission to evaluate their impact. The controls enable the

confirmation of assurance and of attainment of policy objectives and priorities.

Measures to prevent fraud and irregularities

The Ukraine Support Loan Agreement to be concluded between the Commission and

the Ukrainian authorities will require that Ukraine utilises the same management and

control systems as proposed in the Ukraine Plan established under Regulation (EU)

2024/792 that entered into force on 20 June 2024 to ensure that the Union’s financial

interests linked to the Ukraine Support Loan are protected efficiently, providing the

appropriate measures relating to the prevention of, and fight against, fraud,

corruption and any other irregularities linked to the assistance. It will also, in

accordance with the Financial Regulation, grant the necessary rights and access to

the Commission, the European Anti-Fraud Office (OLAF), the European Court of

Auditors and, where applicable, the European Public Prosecutor’s Office, including

from third parties involved in the implementation of Union funds during and after the

availability period of the Ukraine Support Loan. Ukraine should also report

irregularities in relation to the use of the funds to the Commission, in line with the

procedures provided for in the framework agreement under the Ukraine Facility.

EN 52 EN

3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE

3.1. Heading(s) of the multiannual financial framework and expenditure budget

line(s) affected

• Existing budget lines

In order of multiannual financial framework headings and budget lines.

Heading of

multiannual

financial

framework

Budget line Type of

expenditure Contribution

Number

Diff./Non-

diff.35

from

EFTA

countries 36

from

candidate

countries

and

potential

candidates 37

From

other

third

countries

other assigned

revenue

2.2 [06.01.03] – Support expenditure for

borrowing and debt management activities

of the European Union

Non-diff. NO NO NO NO

• New budget lines requested

In order of multiannual financial framework headings and budget lines.

Over and

above MFF

ceilings

Budget line Type of

expenditure Contribution

Number

Diff./Non-

diff.

from

EFTA

countries

from

candidate

countries

and

potential

candidates

from

other

third

countries

other assigned

revenue

O [16.07- Ukraine Support Loan Diff. NO NO NO YES

O [16.07.01] – Debt service cost of Ukraine

Support Loan Diff. NO NO NO YES

35 Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations. 36 EFTA: European Free Trade Association. 37 Candidate countries and, where applicable, potential candidates from the Western Balkans.

EN 53 EN

3.2. Estimated financial impact of the proposal on appropriations

3.2.1. Summary of estimated impact on operational appropriations

–  The proposal/initiative does not require the use of operational appropriations

–  The proposal/initiative requires the use of operational appropriations, as explained below

3.2.1.1. Appropriations from voted budget

EUR million (to three decimal places)

Heading of multiannual financial framework Number

DG: <…….> Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

Operational appropriations

Budget line 16.07.01 Commitments (1a) 0 1 000.000(*) 1 000.000(*)

Payments (2a) 0 1 000.000(*) 1 000.000(*)

Budget line Commitments (1b) 0.000

Payments (2b) 0.000

Appropriations of an administrative nature financed from the envelope of specific programmes

Budget line 06.01.03 (3) 1.000 1.000 2.000

TOTAL appropriations

for DG <…….>

Commitments =1a+1b+3 0.000 0.000 1.000 1 001.000 1 002.000

Payments =2a+2b+3 0.000 0.000 1.000 1 001.000 1 002.000

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

TOTAL operational appropriations

Commitments (4) 0.000 0.000 0 1 000.000(*) 1 000.000(*)

Payments (5) 0.000 0.000 0 1 000.000(*) 1 000.000(*)

EN 54 EN

TOTAL appropriations of an administrative nature financed

from the envelope for specific programmes (6) 0.000 0.000 1.000 1.000 2.000

TOTAL appropriations under

HEADING <….> Commitments =4+6 0.000 0.000 1.000 1 001.000 1 002.000

of the multiannual financial framework Payments =5+6 0.000 0.000 1.000 1 001.000 1 002.000

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

• TOTAL operational appropriations (all

operational headings)

Commitments (4) 0.000 0.000 0.000 0.000 0.000

Payments (5) 0.000 0.000 0.000 0.000 0.000

• TOTAL appropriations of an administrative nature financed

from the envelope for specific programmes (all operational

headings)

(6) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations Under

Heading 1 to 6 Commitments =4+6 0.000 0.000 0.000 0.000 0.000

of the multiannual financial framework

(Reference amount) Payments =5+6 0.000 0.000 0.000 0.000 0.000

(*) These amounts are indicative and based on current forward interest rates and assuming disbursement of EUR 45 billion in 2026 (EUR 15

billion per quarter as of second quarter of 2026). Actual appropriations in 2027 will depend on market conditions at the time of borrowing and

the actual pace of disbursement, and may reach up to EUR 1.3 billion in a scenario of increase in interest rates by 100 basis points compared to

the baseline.

Heading of multiannual financial framework 7 ‘Administrative expenditure’

Year Year Year Year TOTAL

MFF 2021-

2027 2024 2025 2026 2027

 Human resources 0.000 0.000 11.366 11.366 22.732

 Other administrative expenditure 0.000 0.000 0.336 0.336 0.672

EN 55 EN

TOTAL Appropriations 0.000 0.000 11.702 11.702 23/404

TOTAL appropriations under HEADING 7 of the multiannual financial

framework

(Total

commitments

= Total

payments)

0.000 0.000 11.702 11.702 23.404

EUR million (to three decimal places)

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

TOTAL appropriations under HEADINGS 1 to 7 Commitments 0.000 0.000 12.702 1 012.702 1 025.404

of the multiannual financial framework Payments 0.000 0.000 12.702 1 012.702 1 025.404

3.2.1.2. Appropriations from external assigned revenues

EUR million (to three decimal places)

Heading of multiannual financial framework Number

DG: <…….> Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

Operational appropriations

Budget line Commitments (1a) 0.000

Payments (2a) 0.000

Budget line Commitments (1b) 0.000

Payments (2b) 0.000

Appropriations of an administrative nature financed from the envelope of specific programmes

Budget line (3) 0.000

TOTAL appropriations Commitments =1a+1b+3 0.000 0.000 0.000 0.000 0.000

EN 56 EN

for DG <…….> Payments =2a+2b+3 0.000 0.000 0.000 0.000 0.000

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

TOTAL operational appropriations

Commitments (4) 0.000 0.000 0.000 0.000 0.000

Payments (5) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations of an administrative nature financed

from the envelope for specific programmes (6) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations under

HEADING <….> Commitments =4+6 0.000 0.000 0.000 0.000 0.000

of the multiannual financial framework Payments =5+6 0.000 0.000 0.000 0.000 0.000

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

TOTAL operational appropriations

Commitments (4) 0.000 0.000 0.000 0.000 0.000

Payments (5) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations of an administrative nature financed

from the envelope for specific programmes (6) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations under

HEADING <….> Commitments =4+6 0.000 0.000 0.000 0.000 0.000

of the multiannual financial framework Payments =5+6 0.000 0.000 0.000 0.000 0.000

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

• TOTAL operational appropriations (all

operational headings)

Commitments (4) 0.000 0.000 0.000 0.000 0.000

Payments (5) 0.000 0.000 0.000 0.000 0.000

EN 57 EN

• TOTAL appropriations of an administrative nature financed

from the envelope for specific programmes (all operational

headings)

(6) 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations under Headings 1

to 6 Commitments =4+6 0.000 0.000 0.000 0.000 0.000

of the multiannual financial framework (Reference

amount) Payments =5+6 0.000 0.000 0.000 0.000 0.000

Heading of multiannual financial framework 7 ‘Administrative expenditure’

EUR million (to three decimal places)

DG: <…….> Year Year Year Year TOTAL

MFF 2021-

2027 2024 2025 2026 2027

 Human resources 0.000 0.000 0.000 0.000 0.000

 Other administrative expenditure 0.000 0.000 0.000 0.000 0.000

TOTAL DG <…….> Appropriations 0.000 0.000 0.000 0.000 0.000

TOTAL appropriations under HEADING 7 of the multiannual

financial framework

(Total

commitments

= Total

payments)

0.000 0.000 0.000 0.000 0.000

EUR million (to three decimal places)

Year Year Year Year TOTAL MFF

2021-2027 2024 2025 2026 2027

TOTAL appropriations under HEADINGS 1 to 7 Commitments 0.000 0.000 0.000 0.000 0.000

of the multiannual financial framework Payments 0.000 0.000 0.000 0.000 0.000

EN 58 EN

3.2.2. Estimated output funded from operational appropriations (not to be completed for decentralised agencies)

Commitment appropriations in EUR million (to three decimal places)

Indicate

objectives and

outputs



Year 2024

Year 2025

Year 2026

Year 2027

Enter as many years as necessary to show the

duration of the impact (see Section1.6) TOTAL

OUTPUTS

Type38

Avera

ge

cost

N o

Cost N o

Cost N o

Cost N o

Cost N o

Cost N o

Cost N o

Cost Total

No

Total

cost

SPECIFIC OBJECTIVE No 139…

- Output

- Output

- Output

Subtotal for specific objective No 1

SPECIFIC OBJECTIVE No 2 ...

- Output

Subtotal for specific objective No 2

TOTALS

38 Outputs are products and services to be supplied (e.g. number of student exchanges financed, number of km of roads built, etc.). 39 As described in Section 1.3.2. ‘Specific objective(s)’

EN 1 EN

3.2.3. Summary of estimated impact on administrative appropriations

–  The proposal/initiative does not require the use of appropriations of an

administrative nature

–  The proposal/initiative requires the use of appropriations of an administrative

nature, as explained below

3.2.3.1. Appropriations from voted budget

VOTED APPROPRIATIONS Year Year Year Year TOTAL

2021 - 2027 2024 2025 2026 2027

HEADING 7

Human resources 0.000 0.000 11.366 11.366 22.732

Other administrative expenditure 0.000 0.000 0.336 0.336 0.672

Subtotal HEADING 7 0.000 0.000 11.702 11.702 23.404

Outside HEADING 7

Human resources 0.000 0.000 0.000 0.000 0.000

Other expenditure of an administrative nature 0.000 0.000 0.000 0.000 0.000

Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000

TOTAL 0.000 0.000 11.702 11.702 23.404

3.2.3.2. Appropriations from external assigned revenues

EXTERNAL ASSIGNED REVENUES Year Year Year Year TOTAL

2021 - 2027 2024 2025 2026 2027

HEADING 7

Human resources 0.000 0.000 0.000 0.000 0.000

Other administrative expenditure 0.000 0.000 0.000 0.000 0.000

Subtotal HEADING 7 0.000 0.000 0.000 0.000 0.000

Outside HEADING 7

Human resources 0.000 0.000 0.000 0.000 0.000

Other expenditure of an administrative nature 0.000 0.000 0.000 0.000 0.000

Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000

TOTAL 0.000 0.000 0.000 0.000 0.000

3.2.3.3. Total appropriations

TOTAL

VOTED APPROPRIATIONS

+

EXTERNAL ASSIGNED REVENUES

Year Year Year Year TOTAL

2021 - 2027 2024 2025 2026 2027

HEADING 7

Human resources 0.000 0.000 11.366 11.366 22.732

Other administrative expenditure 0.000 0.000 0.336 0.336 0.672

Subtotal HEADING 7 0.000 0.000 11.702 11.702 23.404

Outside HEADING 7

Human resources 0.000 0.000 0.000 0.000 0.000

EN 2 EN

Other expenditure of an administrative nature 0.000 0.000 0.000 0.000 0.000

Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000

TOTAL 0.000 0.000 11.702 11.702 23.404

3.2.4. Estimated requirements of human resources

–  The proposal/initiative does not require the use of human resources

–  The proposal/initiative requires the use of human resources, as explained

below

3.2.4.1. Financed from voted budget

Estimate to be expressed in full-time equivalent units (FTEs)

VOTED APPROPRIATIONS Year Year Year Year

2024 2025 2026 2027

 Establishment plan posts (officials and temporary staff)

20 01 02 01 (Headquarters and Commission’s Representation Offices) 0 0 43 43

20 01 02 03 (EU Delegations) 0 0 10 10

01 01 01 01 (Indirect research) 0 0 0 0

01 01 01 11 (Direct research) 0 0 0 0

Other budget lines (specify) 0 0 0 0

• External staff (inFTEs)

20 02 01 (AC, END from the ‘global envelope’) 0 0 2 2

20 02 03 (AC, AL, END and JPD in the EU Delegations) 0 0 0 0

Admin. Support

line [XX.01.YY.YY]

- at Headquarters 0 0 0 0

- in EU Delegations 0 0 0 0

01 01 01 02 (AC, END - Indirect research) 0 0 0 0

01 01 01 12 (AC, END - Direct research) 0 0 0 0

Other budget lines (specify) - Heading 7 0 0 0 0

Other budget lines (specify) - Outside Heading 7 0 0 0 0

TOTAL 0 0 55 55

3.2.4.2. Financed from external assigned revenues

EXTERNAL ASSIGNED REVENUES Year Year Year Year

2024 2025 2026 2027

 Establishment plan posts (officials and temporary staff)

20 01 02 01 (Headquarters and Commission’s Representation Offices) 0 0 0 0

20 01 02 03 (EU Delegations) 0 0 0 0

01 01 01 01 (Indirect research) 0 0 0 0

01 01 01 11 (Direct research) 0 0 0 0

Other budget lines (specify) 0 0 0 0

• External staff (in full time equivalent units)

20 02 01 (AC, END from the ‘global envelope’) 0 0 0 0

20 02 03 (AC, AL, END and JPD in the EU Delegations) 0 0 0 0

Admin. Support - at Headquarters 0 0 0 0

EN 3 EN

line

[XX.01.YY.YY] - in EU Delegations 0 0 0 0

01 01 01 02 (AC, END - Indirect research) 0 0 0 0

01 01 01 12 (AC, END - Direct research) 0 0 0 0

Other budget lines (specify) - Heading 7 0 0 0 0

Other budget lines (specify) - Outside Heading 7 0 0 0 0

TOTAL 0 0 0 0

3.2.4.3. Total requirements of human resources

TOTAL VOTED APPROPRIATIONS

+

EXTERNAL ASSIGNED REVENUES

Year Year Year Year

2024 2025 2026 2027

 Establishment plan posts (officials and temporary staff)

20 01 02 01 (Headquarters and Commission’s Representation Offices) 0 0 43 43

20 01 02 03 (EU Delegations) 0 0 10 10

01 01 01 01 (Indirect research) 0 0 0 0

01 01 01 11 (Direct research) 0 0 0 0

Other budget lines (specify) 0 0 0 0

• External staff (in full time equivalent units)

20 02 01 (AC, END from the ‘global envelope’) 0 0 2 2

20 02 03 (AC, AL, END and JPD in the EU Delegations) 0 0 0 0

Admin. Support line

[XX.01.YY.YY]

- at Headquarters 0 0 0 0

- in EU Delegations 0 0 0 0

01 01 01 02 (AC, END - Indirect research) 0 0 0 0

01 01 01 12 (AC, END - Direct research) 0 0 0 0

Other budget lines (specify) - Heading 7 0 0 0 0

Other budget lines (specify) - Outside Heading 7 0 0 0 0

TOTAL 0 0 55 55

12 posts and 2 FTE will come from redeployments from the limited Commission redeployment pool.

The implementation of this proposal requires 41 additional posts on top of the establishment plan, all

to be financed by Heading 7 beyond stable staffing. A statement to this effect will be proposed as part

of the legislative procedure.

All staff will be financed by Heading 7.

The staff required to implement the proposal (in FTEs):

To be covered by

current staff

available in the

Commission

services

Exceptional additional staff*

To be financed

under Heading 7

or Research

To be financed

from BA line

To be financed

from fees

Establishment 12 posts 41 posts N/A

EN 4 EN

plan posts

External staff

(CA, SNEs, INT)

2 CA

Description of tasks to be carried out by:

Officials and temporary staff 53 officials and temporary staff to work on:

- Programming/expert group/Committee

- Implementation: horizontal tasks, thematic/technical expertise for EU and UA

desks

- Ukraine financing strategy

- Work on MFA

- Work on defence support

- Audit and control

- Legal work

- Financial circuit design

- Accounting tasks

- Headroom sustainability

- Borrowing and loan management

- Cash calls, settlement reporting, etc.

- Manage contracts

External staff 2 FTE to support the work on programming/expert group/committee

3.2.5. Overview of estimated impact on digital technology-related investments

Compulsory: the best estimate of the digital technology-related investments entailed

by the proposal/initiative should be included in the table below.

Exceptionally, when required for the implementation of the proposal/initiative, the

appropriations under Heading 7 should be presented in the designated line.

The appropriations under Headings 1-6 should be reflected as “Policy IT expenditure

on operational programmes”. This expenditure refers to the operational budget to be

used to re-use/ buy/ develop IT platforms/ tools directly linked to the implementation

of the initiative and their associated investments (e.g. licences, studies, data storage

etc). The information provided in this table should be consistent with details

presented under Section 4 “Digital dimensions”.

TOTAL Digital and IT appropriations

Year Year Year Year TOTAL

MFF

2021 -

2027 2024 2025 2026 2027

HEADING 7

IT expenditure (corporate) 0.000 0.000 0.336 0.336 0.672

Subtotal HEADING 7 0.000 0.000 0.336 0.336 0.672

Outside HEADING 7

Policy IT expenditure on operational programmes

0.000 0.000 0.000 0.000 0.000

Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000

EN 5 EN

TOTAL 0.000 0.000 0.336 0.336 0.672

3.2.6. Compatibility with the current multiannual financial framework

The proposal/initiative:

–  can be fully financed through redeployment within the relevant heading of the

multiannual financial framework (MFF)

–  requires use of the unallocated margin under the relevant heading of the MFF

and/or use of the special instruments as defined in the MFF Regulation

–  requires a revision of the MFF

3.2.7. Third-party contributions

The proposal/initiative:

– ☒does not provide for co-financing by third parties

– provides for the co-financing by third parties estimated below.

Appropriations in EUR million (to three decimal places)

Year 2024

Year 2025

Year 2026

Year 2027

Total

Specify the co-financing body

TOTAL appropriations co-

financed

3.3. Estimated impact on revenue

–  The proposal/initiative has no financial impact on revenue.

– The proposal/initiative has the following financial impact:

–  on own resources

–  on other revenue

–  please indicate, if the revenue is assigned to expenditure lines

EUR million (to three decimal places)

Budget revenue line:

Appropriations

available for the

current financial

year

Impact of the proposal/initiative40

Year 2024 Year 2025 Year 2026 Year 2027

Budget line

For assigned revenue, specify the budget expenditure line(s) affected.

Other remarks (e.g. method/formula used for calculating the impact on revenue or

any other information).

40 As regards traditional own resources (customs duties, sugar levies), the amounts indicated must be net

amounts, i.e. gross amounts after deduction of 20% for collection costs.

EN 6 EN

4. DIGITAL DIMENSIONS

4.1. Requirements of digital relevance

The initiative provides support to a third country and does not establish new EU-level

digital public services for natural or legal persons inside the Union. Nonetheless, digital

elements are supportive for the Ukraine Support Loan where financial assistance

management, defence industrial capability support, and loan initiatives require information

exchange, verification, storage and also provision of information to the Council and

European Parliament where applicable.

R1 – Digital processes for financing and implementation (Chapter V and in particular

Article 26)

Description: transmission of reports, statements or supporting documents electronically

using secure channels and Commission systems for workflows such as requests,

verification, implementing decision or disbursements.

Stakeholders: Commission services and Council; beneficiary authorities, and EEAS for

monitoring the preconditions defined in Article 5.

Processes: Reporting, monitoring, financial management, information exchange.

R2 – Administration of defence-industrial capability support (Chapter IV, in particular

Article 16)

Description: Beneficiary authorities must transmit digital documentation demonstrating

progress on supported defence-industrial capabilities, following Commission standard

templates enabling automated verification.

Stakeholders: Beneficiary authorities; Commission services.

Processes: Monitoring of the implementation and validation of procurements in accordance

with the Regulation.

R3 – Exchange with the European Parliament and the Council, including audit-relevant

information (in particular Chapter VI Articles 28 and 29)

Description: The Commission must provide the European Parliament and Council with

reports and sensitive information through secure systems, where necessary.

Stakeholders: Commission services; European Parliament; Council; beneficiary authorities

(upstream).

Processes: Reporting; audit information exchange; transmission of classified/sensitive

documents.

4.2. Data

For R1–R3, the data includes financial figures, disbursement documentation, defence-

industrial capability data, and other information (including potentially sensitive/classified

material).

Data exchanges are purpose-bound, minimal, interoperable and carried out through existing

EN 7 EN

secure EU systems, avoiding duplicate data collection, aligning with the European Data

Strategy.

Existing Commission datasets and reporting channels will get reused and the aim is that

data already submitted for disbursement or monitoring is not requested again, in-line with

the once-only principle.

Providers: Beneficiary authorities (R1–R2).

Recipients: Commission services; European Parliament and Council for reporting (R3).

Triggers: Reporting cycles, disbursement requests, guarantee notifications, audit

requirements.

Frequency: Periodic (e.g. monthly, or as otherwise defined in the Regulation), and ad hoc

for financial or audit needs.

4.3. Digital solutions

4.4. Interoperability assessment

4.5. Measures to support digital implementation

Concerning all relevant requirements of digital relevance (R1-3), the Commission shall use

a secured exchange system and data templates in order to facilitate the exchange of

classified information and sensitive information between the Commission and Ukraine and,

where appropriate, with the Participating Member States.

Responsibility: Commission services and beneficiary authorities or Participating Member

States or third countries, where appropriate.

AI: No AI functionality is mandated.

Compliance: All systems shall comply with the EU cybersecurity framework, eIDAS, data-

protection rules, and Commission rules on handling classified information.

Reusability: All digital solutions build on existing Commission infrastructure.

The Regulation requires secure exchange of classified/sensitive information, access by the

Commission to all necessary data for obligations laid down in the Regulation, including

verification, and protection of data. All obligations are planned to be met using existing

Commission secure systems without interoperability gaps. This supports R1–R3.

As the Commission already provides assistance to the beneficiary country under existing

financial and operational support frameworks, no additional digital implementation

measures are required for R1 and R3. For defence-industrial capability reporting (R2), the

Commission may, at service level, provide guidance and clarification on the digital

templates and secure exchange procedures to ensure readiness and consistent use by the

involved parties.

    Resolutsiooni liik: Riigikantselei resolutsioon Viide: Rahandusministeerium /  / ; Riigikantselei /  / 2-5/26-00098

Resolutsiooni teema: Ukraina toetuslaenu loomine aastateks 2026 ja 2027 tõhustatud koostöö alusel

Adressaat: Rahandusministeerium Ülesanne: Tulenevalt Riigikogu kodu- ja töökorra seaduse § 152` lg 1 p 2 ning Vabariigi Valitsuse reglemendi § 3 lg 4 palun valmistada ette Vabariigi Valitsuse seisukohtade ja otsuste eelnõud järgmiste algatuste kohta, kaasates seejuures olulisi huvigruppe ja osapooli:

- Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL implementing enhanced cooperation on the establishment of the Ukraine Support Loan for 2026 and 2027, COM(2026)20

- Amended proposal for a COUNCIL REGULATION amending Regulation (EU, Euratom) 2020 /2093 laying down the multiannual financial framework for the years 2021 to 2027, COM(2026)21

- Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EU) 2024/792 establishing the Ukraine Facility,COM(2026)22

EISi toimiku nr: 26-0020 Tähtaeg: 23.01.2026

Adressaat: Kaitseministeerium, Välisministeerium Ülesanne: Palun esitada oma sisend Rahandusministeeriumile seisukohtade kujundamiseks antud eelnõu kohta (eelnõude infosüsteemi (EIS) kaudu). Tähtaeg: 21.01.2026

Lisainfo: Eelnõu on kavas arutada valitsuse 29.01.2026 istungil ja Vabariigi Valitsuse reglemendi § 6 lg 6 kohaselt sellele eelneval nädalal (28.01.2026) EL koordinatsioonikogus. Esialgsed materjalid EL koordinatsioonikoguks palume esitada hiljemalt 23.01.2026. 

Kinnitaja: Nele Grünberg, Euroopa Liidu asjade direktori asetäitja Kinnitamise kuupäev: 15.01.2026 Resolutsiooni koostaja: Sandra Metste [email protected],  

.

15.01.2026

Ukraina toetuslaenu loomine aastateks 2026 ja 2027 tõhustatud koostöö alusel

Otsuse ettepanek koordinatsioonikogule

Kujundada seisukoht

Peavastutaja: Rahandusministeerium

Kaasvastutajad: Välisministeerium, Kaitseministeerium

Kaasvastutaja sisendi tähtpäev 21.01.2026

KOKi esitamise tähtpäev 28.01.2026

VV esitamise tähtpäev 29.01.2026

Seisukoha valitsusse toomise alus ja põhjendus

Algatuse reguleerimisala nõuab vastavalt Eesti Vabariigi põhiseadusele seaduse või Riigikogu otsuse vastuvõtmist, muutmist või kehtetuks tunnistamist (RKKTS § 152¹ lg 1 p 1);

Algatuse vastuvõtmisega kaasneks oluline majanduslik või sotsiaalne mõju (RKKTS § 152¹ lg 1 p 2);

Seisukoha võtmist peab oluliseks peaminister või minister (VVS § 20¹ lg 2);

Sisukokkuvõte

2025. aasta 18. detsembri Euroopa Ülemkogu kohtumisel otsustati toetada Ukrainat järgmisel kahel aastal 90 miljardi euro suuruse laenuga, mis põhineb Euroopa Liidu ühisel laenamisel kapitaliturgudelt liidu eelarve tagatisel. Ukraina ei pea laenu tagasi maksma kuni Venemaa on hüvitanud kahjud. Samuti jätab Euroopa Liit endale õiguse kasutada Venemaa keskpanga külmutatud varasid laenu tagasimaksmiseks. Laenus ei osale Ungari, Slovakkia ja Tšehhi, mistõttu vormistatakse laen tõhustatud koostöö raamistikus, milles osaleb 24 liikmesriiki. Tõhustatud koostöö on mehhanism, mis võimaldab ELi liikmesriikidel teha koostööd konkreetsetes valdkondades juhul, kui on selge, et EL tervikuna ei suuda sellise koostöö eesmärke mõistliku aja jooksul saavutada.

Vastavalt ülemkogu suunisele võttis Euroopa Liidu Nõukogu 12. jaanuaril vastu otsuse, mis annab loa kasutada tõhustatud koostööd laenuinstrumendi loomiseks. 14. jaanuaril esitas Euroopa Komisjon ettepaneku "Ukraina toetuslaenu" (Ukraine Support Loan) loomiseks. Pakett koosneb kolmest eelnõust:

2

1. ettepanek kehtestada Ukrainale toetuslaen summas 90 miljardit eurot - COM(2026) 20 final;

2. ettepanek muuta mitmeaastast finantsraamistikku käsitlevat määrust, et võimaldada Ukraina laenu katmine ELi eelarvelae arvelt - COM(2026) 21 final

3. ettepanek muuta Ukraina rahastut (Ukraine Facility) kui üht vahendit eelarvetoetuse rakendamiseks Ukrainale - COM(2026) 22 final.

Ettepaneku kohaselt jaguneks 90 miljardi suurune toetus kaheks komponendiks: ligikaudu kaks kolmandikku ehk 60 miljardit eurot suunataks sõjalisele abile ning ülejäänud kolmandik ehk 30 miljardit eurot eraldataks üldiseks eelarvetoetuseks kas makromajandusliku finantsabi või Ukraina rahastu (Ukraine Facility raames) vastavalt kokkuleppele Ukrainaga. Toetus aitab Ukrainal tugevdada kaitsevõimet ning tagada riigi ja põhiliste avalike teenuste jätkuv toimimine, aidates samal ajal kaasa Ukraina vastupanuvõimele ja tihedamale lõimumisele Euroopa kaitsetööstusliku baasiga.

Esimesed väljamaksed loodetakse Ukrainale teha II kvartali alguseks, mistõttu on vajalik paketti menetleda nõukogus kiireloomuliselt.

Kas EL algatus reguleerib karistusi või haldustrahve? Ei

Kas nähakse ette uue asutuse loomine (järelevalvelised või muud asutused)? Ei

Kas lahenduse rakendamine vajab IT-arendusi? Ei

Eesmärgid

Mõju valdkonnad

Majandus

Ettevõtlus

Sõjalise abi samba raames võib Eesti kaitsetööstusettevõtetele tekkida vastavalt Ukraina vajadustele ja sõltuvalt pakkumise kiirusest võimalus täiendavalt toetada Ukraina kaitsevõimet, sealhulgas koostöös Ukraina kaitsetööstusega

Riigivalitsemine

Riigieelarve

Laenu tagab ELi eelarve. Laenu teenindamisega seotud kulud (sh intressikulud) kaetaks jooksvalt Eesti ELi eelarve makse sees.

Riigikaitse ja välissuhted

Suhted välisriikide ja organisatsioonidega

Algatus ühtib Eesti prioriteediga toetada Ukrainat pikaajaliselt ja võimalikult suures mahus. Samuti tõstab Euroopa Liidu suurenenud toetus Ukrainale Euroopa Liidu

3

nähtavust ja tõsiseltvõetavust väliste partnerite seas. Samuti seostub laen kolmandate riikide, eelkõige ELi-väliste NATO liitlastega seoses kaitsetoodete abikõlbulikkuse kriteeriumitega – komisjoni ettepaneku alusel on kolmandate riikide kaasumine teatud tingimustel võimaldatud (abikõlbulikud kaitsetooted peavad vastama teatud tingimustele ning pärinema ELi riikidest, Euroopa majanduspiirkonna riikidest, Ukrainast või SAFE laenuinstrumendi raames eraldi kokkuleppe sõlminud riikidega (Kanada), kuid pakiliste vajaduste puhul, mida ei ole võimalik hankida EList või ülaltoodud riikidest, nähakse Ukrainale ette võimalus taotleda erandeid).

Riigikaitse

Ukraina võime ennast pikaajaliselt kaitsta Vene agressiooni eest toetab Eesti ja Euroopa julgeolekut laiemalt.

Kaasamine

Võimalusel kaasata asjassepuutuvad huvirühmad