On Friday 17 July 2026, Luxembourg Government approved a draft law establishing the country's first dedicated legal framework for the manufacture of defence-related products.
The legislation, presented by Luxembourg’s Minister of the Economy, SMEs, Energy and Tourism Lex Delles during the Government Council meeting, forms part of the government's defence industry strategy adopted in March 2026. It aims to strengthen Luxembourg's legal framework while supporting national, European and allied efforts to enhance defence capabilities and resilience.
According to Luxembourg’s Ministry of the Economy the legislation was prepared with the support of Luxembourg’s Ministry of Justice, the Directorate of Defence and the Office for Export, Import and Transit Controls (OCEIT), which are part of Luxembourg’s Ministry of Foreign and European Affairs, Defence, Development Cooperation and Foreign Trade, as well as the Customs and Excise Administration.
Lex Delles commended: "This draft law represents an important step towards developing a modern, transparent and secure framework for Luxembourg's defence industry. It will allow companies operating in this sector to work within a clear legal environment while ensuring a high level of oversight and protecting Luxembourg's essential security interests."
Currently, Luxembourg has no specific legislation governing the manufacture of defence-related products. The proposed law seeks to fill this gap by introducing a regulatory framework tailored to the sector, said the ministry.
Among its key measures is the introduction of a mandatory licensing system for manufacturers. The ministry added that it will assess licence applications against criteria including the integrity of company directors and beneficial owners, the transparency of ownership structures, and the security of production and storage facilities.
According to the ministry, the draft law also stipulates that neither a company's activities nor its ownership or control structure may pose a risk to Luxembourg's national or public security. It detailed that high-risk activities include those linked to espionage, foreign interference, terrorism, violent extremism, the proliferation of weapons of mass destruction, and certain forms of organised crime or cybercrime.
In addition, manufacturers will be required to maintain detailed records tracing defence-related products throughout their lifecycle, from production to export, integration or destruction. Compliance with these obligations will be monitored with the support of the Customs and Excise Administration.
The legislation also clarifies how the new framework will interact with existing laws governing export controls and weapons and ammunition, distinguishing defence industry activities from those involving firearms intended for civilian use, added the ministry.
