Proposal for a new act on defence and security procurement

This initiative is largely a response to the dramatically changed security situation in Europe and globally, which has led to an increased focus on defence, security and preparedness in Norway. The proposed legislation was presented to the Ministry of Defence on 5 September 2025. 

Here, Wikborg Rein provides an overview of the new proposal. Feel free to contact us if you need more information on this topic.

What is the current regulatory situation?

Today, procurements in the defence and security sector are regulated by a separate regulation – the Defence and Security Procurement Regulations ("FOSA"). FOSA implements the EU Defence Procurement Directive (Directive 2009/81/EC) into Norwegian law.

FOSA sets out detailed procedures that the public sector must follow when purchasing in the defence and security sector, but it differs somewhat from the general procurement regulations in Norway. For example, open tendering is not used. FOSA also includes more flexible and tailored solutions to meet the special needs of the defence and security sector.

It is important to note that many defence and security procurements are exempt from FOSA under Article 123 of the EEA Agreement (which is quite similar to Article 346 TFEU). In short, this provision exempts certain procurements from FOSA when essential security interests are involved, in a crisis, or when the procurement relates to the production or trade of weapons. The purpose of the provision is to give the Norwegian Armed Forces greater operational freedom and flexibility in this particularly sensitive area.

What legislative amendments are proposed?

From regulation to a separate act

In practice, the proposed act means that FOSA will be elevated from a regulation (Norwegian: forskrift) to a separate act. Having a dedicated act on defence and security procurement will make the rules more accessible and is also in line with the Procurement Committee’s recommendation for four separate procurement acts (NOU 2023:26).

The act will apply to procurements over NOK 300,000

Today's FOSA applies to procurements equal to or exceeding NOK 100,000 excluding VAT. The working group proposes that the new act raises the limit to NOK 300,000 excluding VAT. This provides greater flexibility for the contracting authority in the case of smaller procurements (i.e. those under NOK 300,000 excluding VAT). The proposal also aligns the scope of application with other legislative trends in Norway, such as the proposals for a new Procurement Act, Supply Act, and Concession Contract Act.

New main purpose: Defence capability and national security

The working group proposes a significant change to the objective of the act compared to the current FOSA. While the current FOSA’s objective is to "increase value creation in society by ensuring the most efficient possible use of resources," the main objective of the new act will be "to strengthen and maintain defence capability and national security." The goal of "promoting the efficient and sustainable use of society's resources" will become only a secondary objective. This change in the act’s objective is perhaps the clearest example of how the new procurement regulations reflect the current defence and security policy situation.

A new and "updated" implementation of the EU Defence Procurement Directive in separate Part III

FOSA implements the EU Defence Procurement Directive (Directive 2009/81/EC) into Norwegian law. This directive ensures that defence and security procurements above the EEA threshold follow a set of common procurement rules throughout the EEA. The working group proposes a new and "updated" implementation of this directive in the new act.

Firstly, it is proposed to collect the directive-based provisions as much as possible in a separate part of the new act (Part III). The working group believes this will clarify that important provisions in the act have an EU/EEA background, and that these provisions must be interpreted in light of both national and EU/EEA legal sources.

Secondly, the working group wants to "update" the implementation. This means that some legal provisions will be designed in line with the more recent procurement directive (2014/24/EU), provided this aligns with current law in the area of defence and security.

Social considerations - but with flexibility for the contracting authority

In Norway, it has become increasingly common to include provisions requiring that procurement processes contribute to achieving specific societal objectives, such as climate, human rights, and social justice. The working group proposes similar provisions in a separate chapter, for example, on climate and environment, pay and working conditions, and human rights. These rules are, however, proposed to be more flexible than those in other Norwegian procurement rules (like the Public Procurement Regulation, Norwegian: anskaffelsesforskriften), as it is acknowledged that social considerations must be balanced against and adapted to defence and security needs. In our opinion, this is due to: 

• Security policy considerations: Defence and security procurements are often crucial for national security, preparedness, and sovereignty. This may require prioritising security of supply, technical capacity, and strategic considerations over other societal objectives.
• Limited supplier base: The defence equipment market is often highly specialised, with few qualified suppliers. Strict requirements for green transition or labour conditions could, in the worst case, exclude critical suppliers or technologies.
• International cooperation: Defence cooperation and NATO commitments may require procurement from allied countries with different standards than Norway, where rigid application of social considerations may prevent necessary cooperation.
• Operational needs: In crisis and war situations, the defence sector must be able to act quickly and efficiently, where national security considerations may take precedence over other societal objectives.

Clarification of the relationship to the Security Act

To date, there has been some uncertainty about how FOSA interacts with the Norwegian Security Act. The proposal addresses this and includes a separate chapter on classified procurements and information security in the act.

Enforcement and sanctions

The proposed act introduces several provisions on enforcement. It clarifies that courts can issue temporary injunctions and set aside decisions made by the contracting authority, provided the case is brought before the contract is signed. Complaints can also be submitted to the Norwegian complaints board for procurement ("KOFA"), but KOFA's decisions will continue to be advisory only. One reason for this is that complex assessments related to Article 123 of the EEA Agreement are best handled by the courts.

It is also proposed to clarify when a supplier may claim compensation for negative and positive contract interest. 

Insightful about Article 123 of the EEA Agreement

As mentioned above, many defence and security procurements will be exempt from FOSA if they fall under Article 123 of the EEA Agreement. This will also apply under the new act. The working group’s working document provides detailed guidance on when a procurement is covered by Article 123 and when it is not, which is very useful.

Article 123 of the EEA Agreement authorises derogations from the obligations of the EEA Agreement. This article contains three main exceptions:

1. The security exception (letter a): To prevent the dissemination of information contrary to essential security interests.
2. Weapons exception (letter b): For measures relating to the production of or trade in arms, ammunition and war material.
3. The crisis exception (letter c): For measures that are considered essential to security in the event of serious internal unrest, war or threat of war.

In Norwegian practice, there have been differing opinions on how Article 123 should be interpreted. This is partly because there are few legal sources clarifying the understanding of Article 123, especially to what degree the provision differs from the similar EU provision (Article 346 TFEU). Both contracting authorities and suppliers have found it challenging to understand the scope of the exemption provisions. In practice, this has resulted in significant discretion for the individual contracting authority.

More flexible rules expected from the EU

To a large extent, the proposed act retains the substantive rules in FOSA, but elevates them to statutory law. Significant regulatory changes in Norwegian law will not be considered until there is a revision at the EU level.

Such a revision is on the way. On 17 June 2025, the European Commission presented a proposal for comprehensive changes to the Defence Procurement Directive. The aim is to simplify and streamline procurement processes in order to strengthen Europe's ability to deal with today's security challenges. The Commission proposes major changes towards a more flexible regulatory framework:

• The EU threshold is dramatically increased to EUR 900,000 (approx. 10 MNOK)
• Open tendering is introduced - a fundamental change for the sector
• New procedures such as dynamic purchasing schemes and innovation partnerships
• Framework agreements can last up to 10 years (compared to the current maximum of 7 years)
• Extended use of the procedures negotiation without publication for joint procurements and off-the-shelf products
• New exemptions and simplifications for joint procurements, innovative products and EDF-funded projects

If the European Commission's proposal is adopted, it will give the contracting authority significantly greater flexibility. However, the new EU rules must also be incorporated into the EEA Agreement to become binding for Norway. Once this happens, the Norwegian procurement regulations will need to be updated accordingly.

The way forward 

In our view, the working group’s proposal includes several appropriate and well-considered measures that will, in many ways, help make the regulations more accessible. At the same time, the proposal reflects the current context, with a clear emphasis on defence and security considerations. This is particularly evident in the new objective of the act and in the way other societal interests are considered secondary to defence and security needs.

The act has now been handed over to the Ministry of Defence for further work. The Ministry has not yet clarified whether the proposal will be sent for public consultation or if a revised proposal will be issued first. A key question for the Ministry will likely be whether to wait for developments at the EU level before making further changes.

Wikborg Rein is closely monitoring these developments and assists clients both with the current regulations and with preparing for future changes. Our experts have deep knowledge of EEA law, procurement law, and contract law, combined with practical experience in defence and security procurement. Please contact us if you need more information.