Investment alert – Is your technology dual-use proof?

Flemish Minister-President Matthias Diependaele has put forward a bold proposal: a 1-billion-euro defence fund, backed by both public and private investment, aimed at strengthening Flanders’ defence industry.

For Flemish high-tech companies, and particularly those with a focus on research and development, this could open an important new funding avenue. If you’re developing advanced technologies with civilian applications, there’s a good chance you already have innovations in your company’s portfolio that could be relevant to security or defence, which would then become “dual-use technology”. The upcoming framework and funding opportunities may help you take those technologies to the next level.

In this blogpost, we focus on the scope of “dual–use technology”, the already existing (funding) opportunities for such technology and the new defence fund proposal.

What Are Dual-Use Technologies?

Dual-use technologies are products, services, or innovations that can serve both civilian and military purposes. Think of drones used for crop monitoring that can also be adapted for border surveillance, or cybersecurity infrastructure that protects both hospitals and critical defence systems. These technologies are becoming increasingly important in both public policy and private R&D strategies, as governments seek to reduce dependence on foreign tech providers.

Since 2018, Flanders has permitted support for military or dual-use innovation under certain conditions (laid down in the 2018 Muyters resolution). A leaked proposal from the Flemish Minister of Economy allows support for projects with a civilian spillover, while excluding offensive weapons and requiring ethical review in sensitive cases.

The Current Framework and What Might Change

The existing rules and requirements allow for a broad spectrum of R&D support, with some exclusions:

• offensive weapons systems are excluded from public R&D support. Think of guns, bombs, or missile systems; and
• other defence technologies can qualify for funding, as long as they receive a positive opinion from the Advisory Committee on Military and Dual-Use Applications. EU and international defence programs (e.g., EDA, PESCO, or NATO-funded programs) are exempt from this advisory step if they already apply ethical guidelines.

Applicants for Flemish dual-use funding must clearly indicate which category their project falls into and provide a business case that outlines expected commercial revenues on both civilian and military fronts. If the project leans heavily toward military use, additional justification is required.

However, Minister-President Diependaele now proposes abolishing the 2018 resolution, arguing that it has outlived its usefulness and is being interpreted too restrictively by institutions like universities and research centres. Many of them, while not legally bound by the directive, have self-imposed policies against military-linked work. The goal now is to remove this chill to enable dual-use innovation as a pillar of strategic autonomy.

Strategic Context: Why Now?

The 2024–2029 Flemish Government Agreement names defence as a strategic sector for the first time. This symbolic shift reflects geopolitical and economic pressures: from global instability and supply chain fragility to the EU’s push for technological sovereignty.

According to the Flemish innovation council (VARIO), Flemish companies often operate in high-tech niches. This makes them ideal candidates for dual-use consortia, but also vulnerable to being overlooked in large defence frameworks. The new defence fund could empower these companies by connecting them with larger value chains and helping them scale in both civilian and military markets.

In parallel, the already existing European Defence Fund is offering €8 billion in co-financing between 2021 and 2027. There’s increasing alignment across the European Union around the importance of so-called “triple helix” collaboration, where governments, businesses, and universities innovate together.

Opportunities for Flemish Innovators

For Flemish businesses, especially in the tech, engineering, materials, and software spaces, this fund signals more than just public investment. It’s an invitation to focus on broad, multi-functional innovation. The defence and security market is evolving quickly and it’s no longer just for traditional contractors.

Companies that previously hadn’t considered defence as a target market may now find themselves ideally positioned to:

• access new funding channels for R&D in dual-use or security-focused tech;
• join international consortia working on EU or NATO-aligned projects;
• strengthen their role in key value chains, by developing critical components or systems that serve both civilian and defence needs; and
• accelerate the commercialization of deep tech through public-private collaboration.

That said, the commercialization of dual-use technologies does come with compliance requirements: export control, end-use declarations, and licensing procedures still apply under the Dual Use Regulation (EU Regulation 2021/821). Diependaele has proposed speeding up these processes, to avoid delays that discourage Flemish participation in international programs.

Looking Ahead

There’s no question that the intent to set-up a more local defence fund represents a strategic pivot. Whether the full €1 billion fund materializes or not, the message is clear: Flanders wants to be a player in Europe’s defence innovation ecosystem. For companies with R&D potential in AI, materials, sensors, cyber, aerospace, or secure communications, now is the time to evaluate whether your technology could be dual-use ready.

While ethical and strategic guardrails remain essential, the political climate has become more supportive of such innovations, and the barriers to entry have become lower.

How Cresco Can Help

At Cresco, we help innovative companies navigate complex legal environments, particularly where technology, regulation, and funding intersect. Whether you’re preparing to apply for dual-use support, joining a defence consortium, or simply exploring commercialization models, our team is ready to guide you, also taking into account ethical principles surrounding dual use of technology.

From business case validation to funding strategy, from intellectual property structuring to compliance with EU dual-use rules, we work closely with Belgian founders, scale-ups, and research institutions to unlock opportunity and manage risk.

Reach out to our team if you have any questions.