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The EU dual-use technologies regulation governs how strategic technologies such as artificial intelligence, semiconductors and aerospace systems can be developed, transferred and exported while creating new opportunities for European industry.
Artificial intelligence systems analysing satellite imagery.
Semiconductors powering advanced computing systems.
Navigation technologies used in autonomous vehicles.
At first glance, these technologies appear purely civilian. However, many of them can also be used for military or defence purposes.
For this reason, they are classified as dual-use technologies.
In recent years, the EU dual-use technologies regulation has become increasingly important. Geopolitical tensions, rising defence spending and global technological competition are pushing governments to pay closer attention to how sensitive technologies are developed and transferred.
As a result, companies operating in sectors such as AI, robotics, aerospace, advanced manufacturing and semiconductors must increasingly navigate complex regulatory frameworks.
Listen to the Podcast on the topic below where I discuss how regulation, geopolitics and industrial policy are reshaping the development of strategic technologies.
In the episode I discuss:
- the growing importance of dual-use technologies
- the EU legal frameworks governing these technologies
- the intersection between defence policy and innovation
- the opportunities for European and Italian industry
Why the EU Dual-Use Technologies Regulation Matters
The importance of the EU dual-use technologies regulation is closely linked to the changing geopolitical landscape.
According to the Stockholm International Peace Research Institute (SIPRI), global military expenditure reached approximately 2.4 trillion dollars in 2024, the highest level ever recorded.
At the same time, many technologies that are essential for military capabilities are now developed in the civilian technology ecosystem.
These include:
- artificial intelligence
- semiconductors
- quantum technologies
- satellite systems
- robotics and autonomous systems
Consequently, governments increasingly view technological capabilities as strategic assets. The EU dual-use technologies regulation therefore plays a key role in ensuring that sensitive technologies are transferred responsibly.
The Core Framework of the EU Dual-Use Technologies Regulation
The central legal instrument governing dual-use technologies in Europe is Regulation (EU) 2021/821, commonly known as the EU Dual-Use Regulation.
This regulation establishes a harmonised framework controlling:
- exports of dual-use goods and technologies
- brokering services
- technical assistance
- transit and transfer of sensitive technologies
Companies exporting controlled technologies outside the European Union must obtain export authorisation from national authorities.
Moreover, the regulation aligns EU rules with international export control regimes such as:
- the Wassenaar Arrangement
- the Missile Technology Control Regime
- the Australia Group
- the Nuclear Suppliers Group
A particularly important innovation introduced in 2021 concerns cyber-surveillance technologies. These technologies may now be restricted if they risk being used to violate human rights.
EU Sanctions and the EU Dual-Use Technologies Regulation
Another important element affecting the EU dual-use technologies regulation is the EU sanctions framework. Following Russia’s invasion of Ukraine, the European Union adopted extensive sanctions that include restrictions on the export of dual-use goods and advanced technologies.
These restrictions cover sectors such as:
- microelectronics
- telecommunications equipment
- aerospace components
- computing technologies
Therefore, companies must carefully assess both export control requirements and sanctions compliance when dealing with dual-use technologies.
Foreign Investment Screening and Strategic Technologies
The EU dual-use technologies regulation is also connected to the EU framework for foreign direct investment screening. Under Regulation (EU) 2019/452, Member States can review foreign investments that may affect security or public order. Dual-use technologies are explicitly identified as strategic sectors.
As a result, acquisitions involving companies active in areas such as artificial intelligence, semiconductors or aerospace may trigger national security review procedures.
Across Europe, governments are strengthening these mechanisms to protect critical technologies.
EU Industrial Policy Supporting Dual-Use Technologies
While regulation introduces controls, the EU is also promoting innovation in strategic technologies.
Several policy initiatives support the development of dual-use technologies.
European Defence Fund
The European Defence Fund (EDF) finances collaborative research and development projects in defence technologies. Between 2021 and 2027, the programme will allocate approximately 8 billion euros.
EU Chips Act
The EU Chips Act aims to strengthen Europe’s semiconductor ecosystem. Semiconductors are among the most important dual-use technologies.
Strategic Technologies for Europe Platform (STEP)
STEP aims to accelerate investment in key technologies including:
- artificial intelligence
- semiconductors
- quantum technologies
- advanced manufacturing
These initiatives demonstrate that the EU dual-use technologies regulation is complemented by industrial policy supporting technological sovereignty.
Opportunities for European and Italian Industry
The expansion of dual-use technologies creates significant opportunities for European companies. Italy, for example, has strong capabilities in sectors closely linked to dual-use innovation, including:
- aerospace
- robotics
- precision engineering
- advanced manufacturing
- artificial intelligence
According to Confindustria, the Italian aerospace and defence supply chain includes more than 4,000 companies and generates approximately 18 billion euros in annual revenue.
Furthermore, structural changes in the automotive sector are pushing several manufacturing companies to explore diversification into advanced technology sectors. Dual-use technologies could therefore become an important driver of industrial transformation.
Compliance Challenges for Companies
Companies operating under the EU dual-use technologies regulation must address several compliance obligations.
These include:
- export control rules
- sanctions compliance
- foreign investment screening
- technology transfer restrictions
- cybersecurity obligations
Failure to comply with these frameworks can lead to significant penalties and restrictions on international trade. Consequently, many companies are strengthening their technology governance and export control compliance programmes.
Technology, Law and Geopolitics
The rise of dual-use technologies reflects a broader transformation in global technology governance.
Technology is no longer viewed only as a driver of economic growth. Instead, it is increasingly considered a strategic geopolitical asset. Export controls, sanctions regimes and industrial policies are therefore becoming central tools in global technological competition. The EU dual-use technologies regulation sits precisely at the intersection of innovation, security and industrial strategy.
Dual-use technologies will likely remain a central component of Europe’s technological future. For companies developing advanced technologies, understanding the EU dual-use technologies regulation is essential. Not only to manage compliance risks, but also to identify new opportunities in strategic markets.
The key challenge for policymakers will be balancing:
- innovation
- competitiveness
- security concerns.