Defence Contracts 2026 Comparisons

The principal regulations concerning the defence sector in Denmark are found in various different legal areas within Danish legislation, with Danish Weapons Act No 1736 of 26 August 2021 on Weapons and Explosives (the “Danish Weapons Act”) (Våbenloven) and the Danish Act No 1004 of 22 October 2012 on War Material (the “Danish War Material Act”) plus related executive orders being the most significant. The relevant legislation is referred to throughout this chapter.

The key governmental authorities are the Ministry of Defence (Forsvarsministeriet) and its agencies, including the Danish Defence Acquisition and Logistics Organisation (DALO) (Forsvarsministeriets Materiel- og Indkøbsstyrelse) and the Danish Business Authority (Erhvervsstyrelsen).

Generally, the distinction is made between civil/military convertibility: war material under the Danish War Material Act covers items designed exclusively for military use with no civil application, whereas dual-use items are – by definition ‒ usable for both civil and military purposes. In this connection, the appendix to Directive 2009/43/EC of 6 May 2009 provides a list of materials considered “defence goods”.

See also 3.1 Export Control Legislation and Regulatory Framework and 3.2 Scope of Controls: Military and Dual-Use Lists.

NATO

Denmark’s NATO commitments are given domestic effect primarily through the Act on the Implementation of the Agreement on the Status of NATO Forces and of the Protocol on the Status of International Military Headquarters (Act No 143 of 1955), which grants allied military authorities the right to exercise criminal and disciplinary jurisdiction on Danish territory over their own forces, within the limits set by the NATO Status of Forces Agreement (SOFA).

A more recent bilateral arrangement built directly on this framework is the Act on Defence Co-Operation Between Denmark and the United States (Act No 698 of 2025), which implements the December 2023 Defence Co-Operation Agreement ‒ under which, US forces may perform tasks in Denmark, and US military authorities are granted disciplinary jurisdiction over their own personnel.

Denmark has also implemented related EU conventional-forces obligations through the Act on Inspection of Conventional Armed Forces in Denmark (Act No 7 of 1992), which allows inspectors from parties to the Treaty on Conventional Armed Forces in Europe to verify Danish compliance on-site.

The Arms Trade Treaty

Denmark signed the Arms Trade Treaty on 3 June 2013 and ratified it on 2 April 2014 following parliamentary approval under Act No 1623 of 26 December 2013. The Arms Trade Treaty was subsequently published in Danish law by Order No 6 of 23 February 2015. Its implementation is integrated into Denmark’s existing weapons and export control legislation, including the Weapons Act (consolidated Act No 1736 of 26 August 2021) and the Danish War Material Act (consolidated Act No 1004 of 22 October 2012), rather than through a standalone implementing act.

The Wassenaar Arrangement

Denmark implements the Wassenaar Arrangement’s export control standards primarily through the EU dual-use framework, in particular Regulation (EU) 2021/821, which applies directly in Denmark. The Export Control Act (Consolidated Act No 635 of 2011) gives further domestic effect to this regime by authorising the Minister for Business and Growth to adopt the national provisions necessary to apply such EU regulations.

EU Defence Directives

Denmark implements EU defence procurement rules through its national procurement framework. In particular, Directive 2009/81/EC on defence and security procurement (the “EU Defence and Security Procurement Directive”) is implemented through Executive Order No 1077 of 29 June 2022, which applies the directive’s rules to certain defence and security contracts in Denmark.

UN Security Council Resolutions

Denmark gives effect to binding United Nations (UN) Security Council resolutions primarily through the EU sanctions framework. Where UN sanctions fall within EU competence, the resolutions are implemented through EU Council decisions and ‒ where necessary ‒ directly applicable EU regulations. Arms embargoes and other defence-related restrictions therefore form part of the legal framework applicable in Denmark. Where implementation falls outside EU competence, Denmark gives effect to the relevant UN measures through the Act on Certain Measures Under the Charter of the United Nations (Consolidated Act No 1079 of 2010), which allows the government to adopt implementing measures by Royal Order.

As a member state of the EU, Denmark’s public procurement regulation is largely shaped by EU legislation. Procurement of defence contracts is therefore generally regulated by three different frameworks:

• the Public Procurement Act (udbudsloven);
• the Executive Order on Defence and Security; and
• Article 346 of the Treaty on the Functioning of the European Union (TFEU).

Which set of rules applies depends on what is being purchased and what interests are at stake.

The Public Procurement Act

Generally, as with all other types of public procurement, defence contracts in Denmark are regulated by the general framework in the Public Procurement Act implementing the EU Defence and Security Procurement Directive.

The Executive Order on Defence and Security

Certain contracts within the defence sector must be evaluated under the Executive Order on contracting entities’ awarding of certain construction, supply and service contracts in the defence and security industry (the “Executive Order on Defence and Security”) that implements the EU Defence and Security Procurement Directive. The special procurement regime applies to contracts in the fields of defence and security for:

• the supply of military equipment;
• the supply of sensitive equipment;
• works, supplies and services directly related to such equipment; and
• works and services for specifically military purposes or sensitive works and sensitive services.

Article 346 of the TFEU

The public procurement rules may be derogated from to the extent necessary and proportionate in the procurement of military equipment, provided that the derogation is justified on grounds of essential security interests and does not adversely affect the conditions of competition within the internal market civilian goods.

The Public Procurement Act

The following entities (“contracting authorities”) are subject to the general framework:

• state authorities;
• regional or municipal authorities;
• public law bodies; and
• associations formed by one or more such authorities or one or more such bodies governed by public law.

The Executive Order on Defence and Security

When contracts fall within the scope the Executive Order on Defence and Security, contracting authorities are subject to a special set of rules. This also applies to public undertakings (undertakings where a contracting authority may exercise dominant influence) and other entities that operate on the basis of special or exclusive rights granted by a competent authority.

Please refer to 1.2 Competent Authorities for more on the most important Danish governmental authorities.

The Public Procurement Act applies to contracts for works, supplies or services; however, as stated in 2.1 Defence Procurement Legislation, the Executive Order on Defence and Security applies to contracts in the fields of defence and security for:

• the supply of military equipment;
• the supply of sensitive equipment;
• works, supplies and services directly related to such equipment; and
• works and services for specifically military purposes or sensitive works and sensitive services.

The Public Procurement Act

Generally, the standard minimum value thresholds apply:

• works ‒ DKK40,313,840 for state authorities and DKK40,313,840 for non-state authorities;
• subcontracts (works) ‒       DKK7.46 million for state authorities and DKK7.46 million for non-state authorities;
• goods and services ‒ DKK1,044,400 million for state authorities and DK1,611,360 for non-state authorities;
• subcontracts (goods and services)‒ DKK596,800 for state authorities and DKK596,800 for non-state authorities; and
• social and other specific services ‒ DK5.595 million for state authorities and DKK5.595 million for non-state authorities.

The Executive Order on Defence and Security

The Executive Order on Defence and Security applies the same minimum value thresholds for contracts related to works and subcontracts for works and goods and services but applies special thresholds for supply and service contracts. As of 2026, the threshold is DKK3,222,720.

Contracts and design contests can be exempted from regulation to the extent that the protection of the essential security interests cannot be guaranteed by less intrusive measures, or where the procurement and performance of the public contract are declared to be secret or must be accompanied by special security measures, provided that the essential interests cannot be guaranteed by less intrusive measures.

Please also refer to 2.9 Evaluation Criteria and Award of Defence Contracts regarding security of information and other non-price factors.

The Public Procurement Act

The following procedures are available for the award of contracts under the Public Procurement Act:

• open procedure where all companies can submit a tender;
• restricted procedure that requires prior pre-qualification;
• negotiated with prior publication of a contract notice;
• competitive dialogue;
• innovation partnership;
• negotiated without publication of a contract notice (direct award); and
• design contest.

Whereas the open and restricted procedures are always available, further conditions apply to the use of the other procurement procedures.

Please refer to 2.4 Restricted and Classified Procurement regarding exemptions.

The Executive Order on Defence and Security

The following tender procedures are available under the Executive Order on Defence and Security:

• restricted procedure that requires prior pre-qualification;
• negotiated procedure with publication of a contract notice;
• competitive dialogue; and
• negotiated procedure without publication (direct award).

Article 346 of the TFEU

Please refer to 2.1 Defence Procurement Legislation.

Trends for Procedures for Defence Contracts

Generally, contracts within the defence sectors are awarded either via regular procedures or via direct award. As such, direct award is used much more commonly for contracts within the defence sector and is typically justified on the basis of urgency or for technical reasons.

Please refer to 2.6 Direct Contract Awards and Single-Source Procurement for an overview of the options for using direct award procurement.

The Public Procurement Act

Contracting authorities may directly award contracts in the following cases:

• no suitable tenders or requests to participate have been submitted in response to an open or restricted procedure;
• the product is manufactured purely for the purpose of R&D, except for quantity production to establish commercial viability or recover research and development costs;
• the works, supplies or services can be supplied only by a particular economic operator for technical reasons or owing to exclusive rights;
• extreme urgency not foreseeable by or attributable to the contracting authority; and
• under certain conditions, works or services consisting in the repetition of similar works or services entrusted to an economic operator awarded an original contract, if not more than three years have passed since the conclusion of the original contract.

All direct award cases are listed in Section 80‒83 of the Public Procurement Act.

The Executive Order on Defence and Security

The defence and security regime broadens the scope for direct award (negotiated procedure without prior publication) as compared with the general public procurement regime, in two respects, as follows.

• A new exemption applies where the periods laid down for the restricted procedure and negotiated procedure are incompatible with the urgency resulting from a crisis, effectively eliminating the “not foreseeable” requirement of the fourth point in the above-mentioned list.
• The time limit for the exemption in the fifth point in the above-mentioned list, concerning the repetition of similar works and services, is extended to five years – with a specific provision allowing this period to be exceeded where justified by exceptional circumstances.

Article 346 of the TFEU

Please refer to 2.1 Defence Procurement Legislation.

Denmark operates a formal industrial-participation (offset) regime for defence procurement, which is administered by the Danish Business Authority (Erhvervsstyrelsen) together with the DALO.

Where a prospective foreign supplier sells defence equipment or services exceeding DKK50 million to DALO, the Ministry of Defence and the Danish Business Authority assess – on a case-by-case basis – whether measures to support Danish defence industrial capability are required. If so, the supplier must sign a legally binding industrial co-operation contract (ICC) with the Danish Business Authority before the acquisition contract with DALO is effective.

The ICC will oblige the supplier to purchase from, or run development/technology-transfer projects with, Danish companies worth between 25% and 100% of the acquisition’s value.

The foreign supplier itself decides how to discharge the obligation, subject to Danish Business Authority approval. Neither DALO nor the Danish Business Authority can force the foreign supplier to work with a specific Danish partner.

Non-compliance can trigger financial penalties and blacklisting from future Ministry of Defence contracts

In general, there are no legislative obligations in respect of security of supply, etc. However, this is typically detailed and regulated in the agreement between the supplier and DALO.

Furthermore, the Danish law on readiness (Consolidated Act No 1741 of 19 December 2025) (Beredskabsloven) authorises the Ministry of Societal Safety and Emergency Management to – in case of war or crisis – seize private property without a court order for the purpose of compulsory acquisition by the government.

Contracting authorities/entities have various options for taking non-price factors (eg, technical capability and security of supply) into account. Each option listed here is subject to the requirement that it be connected to the subject matter of the contract and that it otherwise complies with the general principles of equal treatment, transparency and proportionality

Technical Specifications

The contracting authority may specify the characteristics that the subject matter of the contract must satisfy. This may relate to, among other things, the production process, delivery, or any other process at any stage of the procurement’s life cycle. The technical specifications must be linked to the subject matter of the contract.

Award Criteria

The contract will be awarded to the most economically advantageous tender. The contracting authority/entity may choose between the following award criteria:

• price;
• cost; or
• best price-quality ratio.

Whole-life costs may be taken into account where cost or best price-quality ratio has been chosen as the award criterion.

Other non-price factors (eg, production capacity) related to the subject matter of the contract can be taken into consideration as sub-criteria where best price-quality ratio has been chosen as the award criterion.

Contract Terms

Likewise, contracting authorities/entities may set contract conditions that are also linked to the subject matter of the contract. By way of example, DALO may impose a requirement for security clearance.

The Public Procurement Act

The regulation distinguishes between mandatory and optional grounds for exclusion. The optional grounds apply only if they are set out in the procurement documents.

In addition, exclusion may only take place if it is proportionate and the undertaking has had the opportunity to document its reliability (self-cleaning). The contracting authority may also refrain from excluding on grounds of overriding reasons relating to the public interest.

Mandatory

Any candidate or tenderer shall be excluded if it has been convicted by final judgment or has accepted a fine notice for:

• acts committed as part of a criminal organisation;
• corruption;
• fraud;
• acts of terrorism or criminal offences linked to terrorist activity;
• money laundering or the financing of terrorism; and
• criminal offence related to child labour or human trafficking.

Exclusion also applies if a natural person who is a member of the candidate’s or tenderer’s board of directors, executive board or supervisory board – or who has the power to represent, control, or make decisions on behalf of that board – has been convicted or has accepted a fine notice for the above-mentioned acts.

The contracting authority must also exclude any candidate or tenderer who has unpaid debts of DKK100,000 or more to public authorities in respect of taxes, duties, or social security contributions – provided that no settlement arrangement has been entered into with the recovery authority and complied with.

Furthermore, a candidate or tenderer is to be excluded if:

• it is established in a country included on the EU list of non-cooperative tax jurisdictions (and there are no special agreements);
• a conflict of interest cannot be remedied by other less intrusive measures;
• a distortion of competition from prior involvement in the preparation of the procurement procedure cannot be remedied by other, less intrusive measures;
• where the economic operator has been guilty of serious misrepresentation in supplying information required for exclusion or fulfilment of the selection criteria; and
• it was previously guilty of grave professional misconduct, which renders its integrity questionable.

Optional

Contracting authorities may further choose to apply the following grounds for exclusion:

• non-compliance with applicable obligations in the fields of environmental, social or labour law;
• the candidate or tenderer is declared bankrupt or subject to insolvency proceedings or winding-up proceedings or in a similar situation;
• the candidate or tenderer has materially breached a previous public contract, a contract with a utility company or a concession contract, which has resulted in the termination of the contract or a similar sanction; and
• unpaid debts of less than DKK100,000 to public authorities in respect of taxes, duties or social security contributions (subject to the same exemptions).

The Executive Order on Defence and Security

Under the Executive Order on Defence and Security, the following particular security-related reasons for exclusions apply to procurement.

• The candidate has previously been convicted of grave professional misconduct, such as breach of obligations regarding security of information.
• The candidate does not possess the reliability necessary to exclude risks to the security of the country.       

The following notices must be issued with detailed information that satisfies the principle of transparency in the procurement procedure:

• contract notice;
• contract award notice;
• notice of amendment to the procurement documents or supplementary information; and
• notice of contract modification.

Generally, there must be free and direct access to the tender documents. However, parts of the tender documents may be exempted from publication where the need for confidentiality justifies this.

Please refer to 2.4 Restricted and Classified Procurement regarding security interests and declared secrecy as exemptions to the procurement rules and 2.1 Defence Procurement Legislation regarding Article 346 of the TFEU.

Modification of Contracts Following Award

A distinction is drawn between material changes (which give the contract a substantially different character) and non-material changes. A modification of an essential element requires a new procurement procedure.

Termination of Defence Contracts

There is no specific regulation governing the grounds on which contracting authorities/entities may terminate a defence contract. However, under the general procurement regulation, a contract may be terminated where:

• the contract has been subject to substantial modification;
• the contractor is or becomes subject to a ground for exclusion; or
• the contract infringes the treaties or the EU Defence and Security Procurement Directive.

Bodies and Standing

A defence procurement decision can be challenged by bringing a complaint before the Complaints Board of Public Procurement (Klagenævnet for Udbud) (CBPP) or by bringing proceedings directly before the courts, provided the complainant has legal interest in respect of the tender or the particular contract.

In addition, the Danish Competition and Consumer Authority (Konkurrence- og Forbrugerstyrelsen) (DCCA) has general access to bring complaints before the CBPP and in exceptional cases provides guidance on the interpretation of the public procurement rules. Anyone can contact the DCCA.

Specific Limitations on Decisions Taken on National Security Grounds

There are no specific limitations on the right to challenge decisions taken on national security grounds, as both the CBPP and the courts have jurisdiction to consider complaints concerning violations of the procurement rules under the Executive Order on Defence and Security, as well as complaints related to the use of Article 346 of the TFEU.

Remedies

Complaints filed with the CBPP during the standstill period (generally 10 to 15 days after the publication of the award notice) automatically have suspensive effect until the CBPP decides whether to grant the complaint additional suspensive effect. The burden of proof for suspensive effect is generally high and is in practice rarely granted.

Other Sanctions

When the CBPP has ascertained that public procurement rules have been violated, its sanctions include the following:

• annulling a decision or entire procedure;
• declaring a contract ineffective;
• imposing economic sanction or file a police report for the purpose of a fine; or
• ordering a compensation payment.       

Defence Goods and Military Equipment

In Denmark, the export, transfer, brokering and transit of defence goods and military equipment (eg, weapons, ammunition and explosives) is governed by the Danish Weapons Act and the executive orders issued thereunder, including (but not limited to) the Executive Order No 2531 of 20 December 2021 on weapons and ammunition (the “Danish Weapons Executive Order”). The relevant authority for authorisations is the Danish National Police, acting under the mandate of the Danish Minister of Justice.

As described in 1.1 Principal Legislation and Regulatory Framework and 1.3 Definition of “Defence” and “Dual-Use”,  the Danish War Material Act regulates the production of war material, etc.

Dual-Use Items

Regulation (EU) 2021/821 of the European Parliament and of the Council of 20 May 2021 setting up an EU regime for the control of exports, brokering, technical assistance, transit and transfer of dual-use items (the “EU Dual-Use Regulation”) establishes the EU-wide regime governing the control of exports, brokering, technical assistance and transit of dual-use items.

In Denmark, the EU Dual-Use Regulation is supplemented by the Danish Act No 635 of 9 June 2011 on the Application of Certain European Union Legal Acts Concerning Economic Relations with Third Countries (the “Danish Enabling Act”) and the executive orders issued thereunder, including (but not limited to) the Danish Executive Order No 365 of 23 February 2026 on export control of Dual-Use Items and Technology (the “Danish Dual-Use Executive Order”). Together, these provide the national framework for the administration and enforcement of the EU Dual-Use Regulation in Denmark. The relevant authority for authorisations related to dual-use items, among other things, is the Danish Business Authority.

Defence Goods and Military Equipment

The export of defence goods and military equipment from Denmark requires prior authorisation under Section 6(1) of the Danish Weapons Act. The provision covers all items included on the Common Military List of the European Union, as amended from time to time ‒ as well as, for example, ammunition, military simulation and training equipment, and explosives.

Dual-Use Items

The EU Dual-Use Regulation establishes an EU-wide framework for the control of the export, transfer, brokering and transit of dual-use items. Since February 2026, Denmark no longer maintains a separate national control list for dual-use items that applies in addition to the EU Dual-Use Regulation.

Defence Goods and Military Equipment

The Danish Weapons Act generally prohibits the export, transfer, brokering and transit of controlled defence goods without authorisation. The applicable authorisation may take the form of a general, global or individual licence or an exemption or dispensation from the relevant prohibitions under the Danish Weapons Act. The main categories of licences available are set out in Sections 35‒37 of the Danish Weapons Executive Order.

Dual-Use Items

The categories of licences available are set out in Section 6 of the Danish Dual-Use Executive Order, as follows.

• General national licence ‒ this authorises the export of specified dual-use items to the Ukrainian military, Greenland, and entities within the EU customs territory.
• General EU licence ‒ this authorises the export of specified dual-use items to countries outside the EU, as set out in Annex II to the EU Dual-Use Regulation.
• Global licence ‒ this authorises multiple exports of certain categories of dual-use items for civilian use.
• Individual licence ‒ this authorises a single export that is not covered by a general or global export licence.

Defence Goods and Military Equipment

Applications for export licences are submitted to the Danish National Police using the prescribed digital application form. The information and supporting documentation required depend on the type of licence applied for and may include information on the goods or equipment, the recipient, the end user, and any transit countries, as well as an end-user undertaking and certain declarations. Processing times vary from case to case, depending on the foreign and security policy considerations relevant to the proposed export.

Dual-Use Items

Applications for export licences are submitted to the Danish Business Authority using the prescribed digital application form. The information and supporting documentation required will depend on the type of export licence applied for and may include information on the dual-use items, the value of the export, the recipient, the end user, and any transit countries, as well as an end-user statement and a management statement. Processing times vary from case to case, depending on the foreign and security policy considerations relevant to the proposed export.

Defence Goods and Military Equipment

Export licence applications are assessed on a case-by-case basis against the eight criteria set out in Council Common Position 2008/944/CFSP, as amended, which includes:

• considerations relating to international obligations and commitments;
• respect for human rights and international humanitarian law;
• the internal situation and regional stability in the country of destination; and
• national security.

Dual-Use Items

Applications are assessed on a case-by-case basis, considering the criteria set out in Article 15 of the EU Dual-Use Regulation. These criteria include:

• applicable international obligations and commitments;
• sanctions;
• foreign and security policy considerations;
• the intended end use and end user; and
• the risk of diversion.

Defence Goods and Military Equipment

The standard forms available on the Danish National Police’s website should be used. Post-export verification can be conducted when non-compliance is suspected. Exporters must comply with the conditions of an export licence, including conducting appropriate checks on the recipient and the end use to ensure compliance.

Dual-Use Items

The standard forms available on the Danish Business Authority’s website should be used, including the standard end-user statement form, which the exporter may pre-populate before sending it to the end user for completion. The Danish Business Authority may request information and carry out checks for control purposes. Exporters must comply with the conditions of an export licence, including conducting appropriate checks on the recipient and the end use to ensure compliance.

Defence Goods and Military Equipment

Section 45(a) of the Danish Weapons Act establishes authorisation and registration requirements for certain weapons-brokering activities, including arranging transactions involving weapons, essential components and ammunition, and arranging their transfer between EU member states and third countries.

Dual-Use Items

Brokering activities involving dual-use items are subject to the EU Dual-Use Regulation. As set out in Article 6 of the EU Dual-Use Regulation, authorisation is required in certain circumstances, including where the items may be intended for certain sensitive end uses.

Defence Goods and Military Equipment

There is no general exemption for intra-company or intra-group transfers of controlled defence goods or military equipment across borders.

Dual-Use Items

There is no general exemption for intra-company or intra-group transfers of controlled dual-use items across borders under the EU Dual-Use Regulation. A specific EU general export licence may be used for the transfer of certain types of software and technology between affiliated companies in certain countries.

Defence Goods and Military Equipment

Breaches of the Danish Weapons Act are punishable by a fine or imprisonment for up to four months or, in aggravated circumstances, imprisonment for up to two years. In particularly aggravating circumstances, the conduct may instead fall under Section 192(a) of the Danish Criminal Code, which provides for imprisonment for up to 16 years.

Dual-Use Items

Pursuant to the Danish Enabling Act, breaches of the EU Dual-Use Regulation are punishable by a fine or imprisonment for up to four months or, in aggravated circumstances, imprisonment for up to two years. In particularly aggravating circumstances, the conduct may instead fall under Section 114(h) of the Danish Criminal Code, which provides for imprisonment for up to eight years.

Corporate Criminal Liability and Voluntary Disclosure

Legal persons may also incur criminal liability in accordance with the general rules on corporate criminal liability set out in Chapter 5 of the Danish Criminal Code. As regards civil remedies, the general Danish rules on civil liability and procedure apply and – depending on the circumstances – a breach may give rise to a claim for damages. The Danish National Police is responsible for administering export licences for weapons and military equipment, while enforcement of criminal offences is handled by the police and the prosecution authorities.

There is no formal voluntary disclosure regime. However, voluntary self-disclosure may be considered by the authorities when assessing potential penalties and may support some degree of leniency, depending on the circumstances of the case.

The sanctions regime in Denmark is based on UN and EU sanctions regulations, which contain country-specific and sector-specific sanctions as well as asset freezes, which also apply to the defence sector. The Danish Enabling Act provides the legal basis for enforcing these regulations in Denmark. Denmark has not adopted separate national sanctions legislation. Various Danish authorities handle administration of the sanctions regime in Denmark.

Arms embargoes imposed by the UN and the EU are given effect primarily through directly applicable EU regulations, which prohibit the sale, supply, transfer and export of arms and related material to embargoed destinations, as well as the provision of related technical assistance, brokering services, and financing. Certain EU sanctions regulations allow limited exemptions, such as for non-lethal equipment intended for humanitarian use.

EU and UN sanctions must be complied with by all persons and entities within their scope, regardless of sector. This includes prohibitions on making funds or economic resources available, directly or indirectly, to designated persons or entities. Sanctions screening is therefore an essential compliance measure, particularly in the defence sector and in connection with transactions involving higher-risk jurisdictions or counterparties. Screening standards and ownership and control assessments follow applicable EU requirements and relevant EU guidance.

EU sanctions regulations provide for specific exemptions or derogations from otherwise prohibited activities and specify which licences must be obtained for activities that would otherwise be prohibited. Licences must be obtained from the relevant Danish authorities and the applicable licensing requirements will depend on the area and sector to which the prohibitions relate.

The Danish Business Authority handles licences relating to, for example, asset freezes. Under current practice, the Danish Business Authority requires that an application for a licence under a sanctions regime be submitted as a free-text application, which is not subject to any specific requirements as to form.

Third-country sanctions regimes, such as US sanctions, do not form part of Danish law. However, US sanctions in particular may have broad extraterritorial reach – with the result that Danish persons and entities may face exposure where their activities involve, for example, US-origin goods. In this context, the EU Blocking Statute (Council Regulation No 2271/96, as amended) is of particular relevance, as it is intended to shield EU persons and entities from the effects of certain specified US sanctions with extraterritorial application.

Denmark has not issued specific national guidance on the content of a sanctions compliance programme. At EU level, the Commission Recommendation (EU) 2024/1373 sets out key elements of an effective compliance programme, such as management commitment, risk assessment, sanctions screening, internal controls, record-keeping, training, and auditing. Companies in the defence sector should adapt their programmes to the higher risks associated with the sector, particularly when dealing with higher-risk jurisdictions.

In Denmark, breaches of applicable EU and UN sanctions are subject to criminal penalties under the Danish Criminal Code. Pursuant to Section 110(c) of the Danish Criminal Code, which was amended in 2025 to increase the maximum penalties, breaches are punishable by a fine or imprisonment for up to five years, with a maximum of eight years in particularly aggravating circumstances. In addition, any economic advantage obtained as a result of a breach of applicable EU or UN sanctions may be subject to confiscation under the general rules on confiscation set out in Chapter 9 of the Danish Criminal Code.

As regards civil remedies, the general Danish rules on civil liability and procedure apply. Depending on the circumstances, a breach may give rise to a claim for damages.

See also 3.9 Enforcement, Penalties and Voluntary Disclosure.

There have been no publicly reported sanctions enforcement actions involving Danish defence-sector participants in the past 12 months. The EU has continued to expand its sanctions regime against Russia, including measures targeting Russia’s military industrial complex.

The Danish Weapon Act and the Danish War Material Act are the principal national laws. They regulate, among other things, the production of weapons and war material, import, brokering, and export. The Danish National Police and the Danish Ministry of Justice are the competent authorities.

Furthermore, the Danish Dual-Use Executive Order is relevant. The executive order regulates the export, transfer, brokering, and technical assistance of dual-use products and technology. The Danish Business Authority is the competent authority.

Suppliers to the Danish defence sector may in general be required to submit to a security vetting (depending on the nature of the goods and/or services delivered). When applying for a licence from the Ministry of Justice to manufacture war material pursuant to the Danish War Material Act, the applicant must consent to the Danish Security and Intelligence Service (Politiets Efterretningstjeneste, or PET) and the Danish Defence Intelligence Service (Forsvarets Efterretningstjeneste, or FE) obtaining information about the applicant that is of security-related interest. This includes information obtained from foreign authorities and co-operation partners.

See also 5.7 Counter-Espionage and Inside Threat Obligations.

The Danish Circular on Security and Protection of Classified Information regulates access to and protection of classified information. Section 13 of the circular is referred to in 5.2 Security Vetting and Clearance Requirements.

Public access to documents received or created by a public authority is regulated by the Danish Access to Public Administration Files Act. Under Section 7, any person may request access to documents received or created by a public authority as part of its administrative case processing. However, Sections 19–35 contain a number of exemptions to Section 7, including that access may be restricted to the extent that it is of material importance to the security of the State or the defence of the realm.

See also 5.7 Counter-Espionage and Insider Threat Obligations.

Certain defence-related assets, activities and services are subject to specific protection under Danish law. For instance, certain non-public military installations and other military assets are subject to specific protection under Section 110a of the Danish Criminal Code, including restrictions on unauthorised photography. Military areas may also be subject to access restrictions under the Act on Access to and Passage Through Military Areas.

Please refer to 6.1 FDI Screening Legislation and Regulation in respect of Danish FDI regulation.

Denmark does not operate a single, cross-industry cybersecurity certification scheme for defence contractors comparable to the US Cybersecurity Maturity Model Certification (CMMC). The applicable requirements are layered and turn on the classification of the government information being handled, the contractor’s activities, and the individual contract. The most important layers are:

• the general classified-information regime administered by the Danish Defence Intelligence Service in the defence sector;
• the Network and Information Systems 2 Directive (“NIS2”) baseline (subject to a defence carve-out);
• the national cybermonitoring arrangements now run by the Danish Agency for Societal Security (Styrelsen for Samfundssikkerhed, or SAMSIK) together with the FE; and
• the contractual security clauses that flow from the defence and security procurement regime.

Denmark has no general statute prohibiting components or software from specific countries in the defence sector. Instead, supply chain risks are addressed case-by-case under a targeted regime, complemented by foreign investment screening.

See also section 6.1 FDI Screening Legislation and Regulation in respect of FDI regulation.

Security Clearance

Access to classified information is controlled through a formal security clearance system set out in the Danish Security Circular (Sikkerhedscirkulæret) governing the protection and handling of classified information shared within Denmark, NATO and the EU. Only persons cleared for the relevant classification level may access such information, with “top secret” clearances generally valid for up to five years and “secret/confidential” clearances generally valid for up to ten years.

The Danish Security and Intelligence Service conducts the underlying security investigation, while the relevant public authority makes the decision on whether an individual may be security cleared. The clearance decision is based on an overall assessment of the information available concerning the individual, including in particular the individual’s loyalty, conduct, character, habits, associations and discretion. Access is further restricted by a “need to know” principle, which applies even to personnel who already hold the relevant security clearance.

For companies performing classified work for the Danish defence sector, additional requirements apply under the military security regime administered by the Danish Defence Intelligence Service. Notably, a company may be required to obtain a facility security clearance (områdesikkerhedsgodkendelse) where it is to handle classified information at company level. The applicable security requirements may cover, among other things, personnel security, physical security, information security, access controls, and procedures for the handling and storage of classified information.

These requirements are also relevant to the prevention and management of insider threats. Companies must, among other things, ensure that only appropriately authorised personnel have access to classified information and that access is limited to persons with a genuine need to know. The security regime therefore operates not only through initial security clearances but also through ongoing controls concerning access to and handling of classified information.

Reporting Obligations

Under the Danish Security Circular, a security-cleared supplier must immediately report any loss or compromise of classified information ‒ or any suspicion that an unauthorised person may have gained knowledge of its contents ‒ to its security officer. The security officer must then notify the responsible manager, initiate an investigation, notify the originator of the information, and take the necessary steps to limit the consequences of the actual or suspected compromise.

For companies subject to the FE’s military security regime, the reporting obligations are broader. The company’s security officer must immediately report to the FE’s Industrial Security Section (Sektionen for Industrisikkerhed) any suspicion or detection of espionage, sabotage, subversion, terrorism, or similar activity. Reporting is also required in relation to other security-significant incidents, including attempted or actual break-ins, theft, loss or disappearance of material or components, compromise of classified information, suspicious behaviour, and actual or suspected breaches of the confidentiality, integrity or availability of information systems.

Following such an incident, the security officer must consult the FE regarding any specific considerations or additional measures required, including whether immediate contact with the police is appropriate. A written report must be submitted to the FE’s Industrial Security Section promptly following any suspected or confirmed security breach.

Separately, where a defence-sector company falls within the scope of the Danish NIS2 Act (Act No 434 of 6 May 2025), cybersecurity incidents may trigger additional statutory reporting obligations..

As further described in the foregoing sections and in 6 M&A, Joint Ventures and Foreign Direct Investment in the Defence Sector, the Danish FDI Act allows the Danish Business Authority to impose conditions on foreign investments, including restrictions on ownership and management. Companies producing war material, etc are also subject to restrictions on foreign ownership and board composition under the Danish War Material Act that may have a similar effect.

Denmark regulates defence-related national security through several separate regimes rather than a single overarching framework. These include export controls, sanctions, foreign direct investment (FDI) screening, defence procurement, and the protection of classified information, as described in the foregoing sections and 6 M&A, Joint Ventures and Foreign Direct Investment in the Defence Sector.

Legislation

The primary Danish legislation governing the screening of foreign direct investment is the Danish Act No 1256 of 17 October 2023 on Foreign Direct Investments (the “Danish FDI Act”).

The Danish FDI Act is supplemented by executive orders ‒ the two most significant being:

• Executive Order No 1491 of 25 June 2021 on Delimitation of the Scope of Application of the Act on Screening of Certain Foreign Direct Investments in Denmark (the “Executive Order on Application”); and 
• Executive Order No 958 of 26 June 2023 on Procedure, etc for Applications for Approval of or Notification of Certain Foreign Direct Investments or Special Economic Agreements in Denmark (the “Executive Order on Procedure”).

In addition, foreign investments in companies that produce war material are subject to a separate regime under the Danish War Material Act. If an investment is covered by the Danish War Material Act, the general rules on FDI under the Danish FDI Act do not apply. Instead, the investment must be assessed and, where required, approved under the Danish War Material Act. This exception only applies to investments. The Danish FDI Act’s rules on special economic agreements therefore continue to apply to companies covered by the Danish War Material Act. In practice, this means that if the Danish target holds a licence under the Danish War Material Act, any required prior approval of the investment must be obtained under that the Danish War Material Act rather than under the Danish FDI Act.

Competent Authority

The Danish Business Authority is the competent authority responsible for administering and enforcing the Danish FDI Act.

Where the Danish War Material Act applies, the regulation is enforced by the Danish Minister of Justice.

Scope

Pursuant to the Danish FDI Act, prior authorisation is required before completing foreign investments in and special economic agreements with Danish companies within certain critical sectors and activities if certain thresholds are exceeded.

The Danish FDI Act distinguishes between investments in particularly sensitive sectors and activities, which are subject to mandatory prior screening, and other investments that may be reviewed under the voluntary notification regime where they are capable of affecting national security or public order.

The following are deemed as “particularly sensitive sectors and activities” and are covered by the requirement for prior authorisation set out in Section 5 of the Danish FDI Act:

• companies within IT security functions or processing of classified information;
• companies within the defence sector;
• companies that produce dual-use items;
• companies within “other critical technology”; and
• companies within “critical infrastructure”.

Companies within the defence sector are defined as follows:

• companies developing or producing weapons, ammunition or other technology for military use on the EU Common Military List; and
• companies that provide services to the Danish defence sector that are of particular importance to the operations of the Danish defence sector.

The Danish War Material Act applies to companies that produce war material, including equipment designed exclusively for military use, firearms and firearm-like objects not specifically made for hunting or sport, military-use ammunition, power and explosives, and components or parts designed for such material with no civilian application.

FDI

The mandatory and voluntary screening regimes under the Danish FDI Act cover:

• foreign direct investments in Danish companies; and
• special economic agreements made by foreign entities with Danish companies.

The Danish War Material Act

The screening regime under the Danish War Material Act covers foreign investments but not special economic agreements, which would instead be subject to the Danish FDI rules.

Approval is required from the Danish Minister of Justice in the event of a foreign investment in a company that produces war material under certain circumstances.

FDI

Mandatory pre-approval

Foreign investments and special economic agreements involving Danish companies operating in a particularly sensitive sector or activity, including the defence sector, are subject to mandatory screening and approval where the applicable thresholds are met.

The consequences of failing to obtain mandatory prior approval may include an order from the Danish Business Authority to submit a filing or, where appropriate, to unwind the transaction. If an order to unwind the transaction is not complied with, the Danish Business Authority may ultimately suspend the investor’s voting rights in the Danish target.

There are no fines associated with breaching the Danish FDI screening rules.

Voluntary pre-notification

The Danish FDI Act contains a voluntary cross-sectoral notification mechanism for special economic agreements with or investments of 25% or more of the shares, voting rights or similar means of control in Danish companies that fall outside the applicable sensitive sectors and activities, but which can nevertheless pose a threat to national security or public order.

The Danish War Material Act

Foreign investments that fall within the scope of the Danish War Material Act are subject to a mandatory pre-approval requirement. Failure to obtain such approval can be sanctioned by a fine or imprisonment.

FDI

For FDI applications, the Danish Business Authority conducts its review in up to two phases.

The statutory review period under the first phase is 45 calendar days (after the application has been declared final) ‒ after which, the Danish Business Authority can either approve the application or progress it to the second phase. Under the second phase, the Danish Business Authority and the Ministry of Industry, Business and Financial Affairs have an additional review period of 125 calendar days ‒ after which, the authority/ministry can either:

• clear the transaction without remedies;
• clear the transaction with remedies; or
• prohibit the transaction.

For transactions that fall under the mandatory screening regime, the parties are not allowed to close the transaction before approval has been granted.

The Danish War Material Act

The Danish War Material Act entails a separate approval procedure through the Danish Ministry of Justice. The case-handling procedure is conducted in one phase and typically requires the Danish Ministry of Justice to gather information from various relevant authorities, including the Ministry of Foreign Affairs and a technical assessment from the DALO. The stated average processing time is two to three months but may in certain cases be significantly longer.

FDI

The Danish Business Authority assesses whether an investment may pose a threat to national security or public order. Pursuant to Section 15 of the Danish FDI Act, the assessment takes into account factors relating both to the Danish company and to the foreign investor.

In relation to the Danish company, relevant factors include whether the company:

• operates within or impacts critical infrastructure;
• has access to classified information or sensitive personal data;
• provides products or services that are difficult to replace;
• is active in the defence industry or develops critical or dual-use technology; and
• is involved in the supply of critical raw materials or other strategically important resources.

In relation to the foreign investor, the authority considers whether:

• the investor is directly or indirectly controlled by a foreign government, governmental body or armed forces, including through ownership or significant funding;
• the investor has been involved in activities affecting security or public order in an EU member state or other friendly or allied countries;
• there is a serious risk that the investor is involved in or connected with unlawful or criminal activities relevant to national security or public order; and
• there are indications that the investor is deliberately attempting to circumvent the investment screening rules.

The Danish War Material Act

Pursuant to Section 4 of the Danish War Material Act, the Danish Minister of Justice must approve transactions that fall within the scope of Section 3, unless foreign policy or security considerations speak against it. The assessment is a broad, discretionary foreign policy and security policy evaluation carried out by the Ministry of Justice in consultation with other authorities, including (but not limited to) the Ministry of Foreign Affairs and the Danish intelligence services.

FDI

The Danish Business Authority may impose a broad range of conditions before granting approval, including behavioural commitments, structural remedies, limitations on the investor’s ownership interest or participation in management, restrictions on access to certain areas of the company, and security agreements.

If a potential threat cannot be adequately mitigated by imposing conditions, the Minister for Industry, Business and Financial Affairs may refuse to approve or prohibit the investment or agreement. Where an investment or agreement has already been completed, the Minister for Industry, Business and Financial Affairs may order its termination and require evidence that it has been terminated.

The Danish War Material Act

An authorisation pursuant to Section 3 of the Danish War Material Act will typically be accompanied by certain conditions and reporting obligations. Most notably, the company will normally be obliged to inform the Danish Ministry of Justice about any subsequent changes to the ownership or control structure that may have an effect on the national security and foreign policy assessment of the authority.

Transactions may be prohibited based on foreign policy or security considerations, as further described in 6.5 Assessment Criteria.

Denmark does not have a generally applicable statutory “golden share” regime for defence companies under either the Danish FDI Act or the Danish War Material Act. National security control is principally exercised through the regulatory powers of the relevant authorities rather than through a general statutory government veto attached to a special class of shares.

Restrictions on joint ventures in the defence sector involving a foreign partner are principally governed by the Danish FDI rules or (if applicable) the Danish War Material Act as described previously.

FDI/national security review operate as separate regimes under Danish law, with no specific co-ordination mechanism between the relevant authorities. Where a transaction is caught by both regimes, approval is required under both independently.

In general, it is the Danish National Police who investigates potential breaches of Danish laws. However, the State’s arms control and the Danish Business Authority carries out inspections and supervision with companies that manufacture war material and companies whose activities are covered by dual-use regulations or sanctions.

Procurement Law

The system is designed so that any party with a legal interest can file complaints about breaches of the procurement rules before the CBPP or bring proceedings before the courts. Please refer to 2.13 Challenging Defence Procurement Decisions regarding access to challenging defence procurement decisions.

Competition Law

The DCCA holds the power to investigate any undertaking, including companies active within the defence sector, for breaches of competition law. The DCCA may open investigations if the undertaking enters into agreements that restrict competition or if a dominant undertaking abuses its dominant position.

Generally, investigations are initiated on basis of a suspected breach or violation. However, companies who have a licence to manufacture war material under the Danish War Material Act must annually send specific information to the State’s arms control, including (but not limited to):

• the quantity, type and proportion of turnover accounted for by the war material manufactured during the financial year;
• the parties to whom war material was supplied during the financial year;
• the order book for war material at the end of the financial year; and
• the stock of war material at the end of the financial year.

Procurement Law

An examination of the legality of all or part of a procurement process is typically triggered by a competitor filing a complaint with the CBPP.

Competition Law

Investigations by the DCCA are typically triggered by information received from a competitor, customer, or other party alleging a possible infringement or by the authority opening a case on its own initiative. Cases can also arise from a voluntary self-report made in exchange for immunity or a reduction of fines (a leniency application).

Denmark has no dedicated investigative regime for the defence sector. Breaches of procurement rules, export controls, sanctions, or national security obligations are investigated under the ordinary powers of the Danish Administration of Justice Act, which apply across all Danish criminal procedure. This includes the Danish Security and Intelligence Service and the Danish Defence Intelligence Service, which conduct their investigations under the same statutory framework as the rest of the criminal justice system. These powers are supplemented by sector-specific inspection tools available to regulators such as the Danish Business Authority and DALO.

Competition Law

In the event of an investigation under the Danish Competition Act (Konkurrenceloven), the DCCA can request all information necessary for its investigation. Failure to comply can be met with fines. This is not unique to the defence sector.

Procurement Law

The DCCA and the CBPP can request all information necessary to assess whether the procurement rules have been complied with. Likewise, failure to comply can be met with fines. This is not unique to the defence sector.

Obligations

Under the Danish Competition Act, the DCCA can conduct unannounced inspections at the premises of a company (dawn raids). A court order must have been obtained in advance and proper identification must be presented. Failure to comply with the DCAA’s requirements can be met with fines.

Rights

The DCCA’s right to obtain and examine information is limited by legal professional privilege (see 7.5 Legal Professional Privilege and Confidentiality) and self-incrimination rules.

Investigations Carried Out by Other Authorities

The EC may also carry out unannounced investigations. Generally, the same rules apply; however, there are certain differences.

Parties are generally not required to hand over legal professional privileged documents. Protection is subject to the condition that the document was prepared solely for the purpose of obtaining legal advice from an external lawyer to exercise the right of defence.

Please also see 5.3 Classified Information and Official Secrets and 7.4 Dawn Raids and Unannounced Inspections.

Please refer to 2.10 Exclusion Grounds regarding grounds for exclusion in public procurement.

There is no specialist Danish court with exclusive jurisdiction over disputes arising from defence contracts. Contractual disputes involving the Danish Ministry of Defence, the Danish defence sector or defence-sector suppliers are generally subject to the ordinary Danish courts, unless the contract contains an arbitration agreement or provides for another agreed dispute-resolution mechanism.

Ordinary civil proceedings are therefore the principal forum for contractual disputes.

Denmark does not have a separate statutory whistleblower regime specifically for breaches of defence-related regulation. Such reports may instead fall within the general framework of the Danish Act No 1436 of 29 June 2021 on the Protection of Whistleblowers (the “Danish Whistleblower Act”). Where the Danish Whistleblower Act applies, whistleblowers benefit from the general protections provided under the law, including confidentiality and protection against retaliation. However, the Danish Whistleblower Act does not apply to reports containing classified information.

Under Danish law, legal entities may be subject to criminal liability for breaches of defence-related regulation, where the relevant legislation provides for corporate criminal liability. This may include export control violations and breaches of applicable sanctions legislation. The Danish Weapons Act, for instance, expressly provides that companies and other legal entities may be held criminally liable under the rules in Chapter 5 of the Criminal Code for breaches of its export control provisions.