Entering the defence sector: a legal checklist for businesses

Increased defence spending and new investment programmes mean that more and more organisations are considering entering the defence sector. However, this is a market with high barriers to entry, particularly in terms of regulation and contracts. The checklist below sets out the key legal issues that an entrepreneur should analyse before entering the defence market.

• Licences and sector-specific regulations – it is necessary to verify whether the planned activity is subject to a licence requirement (e.g. in relation to the trade in or manufacture of military-use products);
• Industrial security – participation in projects involving classified information requires the acquisition of the relevant industrial security clearances and staff vetting, which in practice can take up to several months;
• Quality standards (e.g. NATO AQAP, ISO 9001) are a practical requirement for participation in many tendering procedures;
• Understanding procurement procedures – the defence sector operates under a different regime to that of the standard Public Procurement Law – defence-related exceptions in the Public Procurement Law.
• Compliance in the defence sector – a system of rules, procedures and tools designed to ensure that an organisation’s activities comply with the law, internal regulations and defence standards. In the defence sector, compliance is crucial for national security;
• Supply chain and due diligence – it is essential to verify existing partners and suppliers, particularly in terms of regulatory and quality compliance. The defence sector is not a market for haphazard decisions. It is an area where legal, organisational and compliance preparedness determines not only the possibility of market entry, but also the long-term security of the business. Companies that take regulatory requirements, quality and safety standards into account at a sufficiently early stage gain a real advantage – they avoid costly mistakes and build credibility in the eyes of contracting authorities. Defence law is not a barrier – it is a tool. Used correctly, it becomes the foundation for secure and scalable growth in one of the most demanding sectors of the economy.