Category: Machine Learning

  • MIL-Evening Report: Pope Leo XIV expresses solidarity for ‘persecuted’ journalists seeking truth, calls for their freedom

    By Devin Watkins of Vatican News

    Only four days have passed since his election to the papacy, and Pope Leo XIV has made it a point to hold an audience with the men and women who were in Rome to report on the death of Pope Francis, the conclave, and the first days of his own ministry.

    He met media professionals in the Vatican’s Paul VI Hall yesterday, and thanked reporters in Italian for their tireless work over these intense few weeks.

    The newly-elected Pope began his remarks with a call for communication to foster peace by caring for how people and events are presented.

    He invited media professionals to promote a different kind of communication, one that “does not seek consensus at all costs, does not use aggressive words, does not follow the culture of competition, and never separates the search for truth from the love with which we must humbly seek it.”

    “The way we communicate is of fundamental importance,” he said. “We must say ‘no’ to the war of words and images; we must reject the paradigm of war.”

    Solidarity with persecuted journalists
    The Pope went on to reaffirm the Church’s solidarity with journalists who have been imprisoned for reporting the truth, and he called for their release.

    He said their suffering reminded the world of the importance of the freedom of expression and the press, adding that “only informed individuals can make free choices”.

    Service to the truth
    Pope Leo XIV then thanked reporters for their service to the truth, especially their work to present the Church in the “beauty of Christ’s love” during the recent interregnum period.

    He commended their work to put aside stereotypes and clichés, in order to share with the world “the essence of who we are”.


    Pope Leo XIV calls for release of journalists imprisoned for ‘seeking truth’   Video: France 24

    Our times, he continued, present many issues that were difficult to recount and navigate, noting that they called each of us to overcome mediocrity.

    Facing the challenges of our times
    “The Church must face the challenges posed by the times,” he said. “In the same way, communication and journalism do not exist outside of time and history.

    “Saint Augustine reminds of this when he said, ‘Let us live well, and the times will be good. We are the times’.”

    Pope Leo XIV said the modern world could leave people lost in a “confusion of loveless languages that are often ideological or partisan.”

    The media, he said, must take up the challenge to lead the world out of such a “Tower of Babel,” through the words we use and the style we adopt.

    “Communication is not only the transmission of information,” he said, “but it is also the creation of a culture, of human and digital environments that become spaces for dialogue and discussion.”

    AI demands responsibility and discernment
    Pointing to the spread of artificial intelligence, the Pope said AI’s “immense potential” required “responsibility and discernment in order to ensure that it can be used for the good of all, so that it can benefit all of humanity”.

    Pope Leo XIV also repeated Pope Francis’ message for the 2025 World Day of Social Communication.

    “Let us disarm communication of all prejudice and resentment, fanaticism and even hatred,” he said. “Let us disarm words, and we will help disarm the world.”

    The Paris-based global media freedom watchdog Reporters Without Borders (RSF) welcomed the Pope’s commitment and has issued five concrete recommendations to the new head of the Catholic Church and Vatican City.

    As censorship, misinformation and violence against journalists are on the rise worldwide, RSF has called on the Holy See to maintain a strong, committed voice for press freedom and the protection of journalists everywhere.

    “The fact that one of Pope Leo XIV’s first speeches addressed press freedom and the protection of journalists sends a strong signal to news professionals around the world. RSF salutes Pope Leo XIV’s commitment to press freedom and calls on him to build on his declaration with concrete actions to promote the right to information,” said RSF director-generalThibaut Bruttin.

    In his first Sunday noon blessing, Pope Leo XIV called for genuine peace in Ukraine and an immediate ceasefire in Israel’s war on Gaza.

    “No more war,” the pontiff said, adding a warning against “the dramatic scenario of a third world war being fought piecemeal.”

    Devin Watkins writes for Vatican News. Republished under Creative Commons.

    MIL OSI AnalysisEveningReport.nz

  • MIL-OSI USA: Rep. Peters & Colleagues Reintroduce Landmark Legislation to Restore Patent Protections

    Source: United States House of Representatives – Congressman Scott Peters (52nd District of California)

    WASHINGTON, D.C. – Today, Representatives Scott Peters (D-CA-50) and Kevin Kiley (R-CA-03) and U.S. Senators Thom Tillis (R-NC) and Chris Coons (D-DE) reintroduced legislation to restore patent eligibility for inventions that are essential to the life sciences and technology industries. Their Patent Eligibility Restoration Act will help support American businesses and universities from foreign actors that stand to steal their innovations.  

    “For more than two centuries, a U.S. patent has guaranteed inventions will be protected from theft, helping the U.S. become the innovation capital of the world. San Diego, in particular, is the proud home of a thriving life sciences and technology ecosystem that has benefited from these protections,” said Rep. Peters. “Over the last 15 years, however, several Supreme Court decisions have created confusion about what exactly is eligible for a patent. Innovators, consumers, and even the judges who adjudicate patent law have called on Congress to provide clarity on what can be patented. I look forward to working with Congressman Kiley, Senator Coons, and Senator Tillis to advance our Patent Eligibility Restoration Act and protect American innovation.” 

    “American innovators have been at a disadvantage in recent years because of the U.S. patent system,” said Rep. Kiley. “Convoluted Supreme Court rulings and tests on subject matter eligibility have made it increasingly difficult for inventors to receive patents, leading to foreign companies overtaking our own. That’s why I’m proud to introduce the bi-partisan Patent Eligibility Restoration Act, which will dramatically reverse this trend, and unleash a tide of economic growth and job creation here at home.” 

    “When American innovators know their ideas are eligible for patent protection, they take the risks that push us into the future – whether that’s the next medical test or the latest AI technology,” said Senator Coons. “PERA restores clarity to the law on what can be patented and what cannot – guidance that federal courts have been requesting for years and that the Supreme Court has refused to provide. Congress must step up to provide America’s inventors with the stable legal foundation they need to produce the cutting-edge technologies that power our economy.” 

    “Clear, reliable, and predictable patent rights are imperative to enable investments in the broad array of innovative technologies that are critical to the economic and global competitiveness of the United States, and to ensuring the national security of our great country,” said Senator Tillis. “Unfortunately, a series of Supreme Court decisions have rendered patent eligibility law unclear, unreliable, and unpredictable, resulting in U.S. inventors being unable to obtain patents in areas where our economic peers offer patent protection. This is particularly concerning in the economically critical areas of biotechnology and artificial intelligence. This bipartisan, bicameral legislation maintains the existing statutory categories of eligible subject matter, which have worked well for over two centuries, while addressing inappropriate judicially created eligibility limitations by creating clear rules for what is eligible. We cannot allow foreign adversaries like China to overtake us in key areas of technology innovation due to the current state of patent eligibility law. I look forward to continuing to work with all stakeholders on this important matter. Passing patent eligibility reform is one of my top legislative priorities.” 

    Background: 

    Throughout our history, patent law has generally recognized three limited judicial exceptions to patent eligibility: abstract ideas, natural phenomena, and laws of nature. Since 2010, the Supreme Court has handed down several rulings that vastly expand those three initial exceptions. As a result, new medical diagnostics, like those pioneered by the biosciences community in San Diego, are almost entirely excluded from patent eligibility. 

    There is widespread bipartisan agreement in Congress and across recent Administrations that reforms are necessary to restore the United States to a position of global strength and leadership in key areas of technology and innovation, such as medical diagnostics, biotechnology, personalized medicine, artificial intelligence, 5G, and blockchain. 

    PERA would replace vague judicial exceptions like “abstract ideas” and “laws of nature” with a clear statutory framework for determining patent eligibility. This change will give inventors and courts predictable guidelines, reducing confusion and inconsistency in patent determinations. 

    By broadening patent eligibility to include areas like AI and medical diagnostics, PERA brings U.S. patent law in line with our international competitors. This alignment will help prevent innovation and investment in these areas from drying up in the United States and flowing to countries with more accommodating patent systems. 

    Full text of the bill is available HERE.

    ###

    MIL OSI USA News

  • MIL-OSI Economics: Meet the Samsung Galaxy S25 Edge: An Engineering Marvel of New Slim Hardware Innovation

    Source: Samsung

    Samsung Electronics Co., Ltd. today has revealed the full specifications of the Galaxy S25 Edge, a category-defining slim smartphone joining the Galaxy S series. Crafted with style and strength in mind, Galaxy S25 Edge strikes a new balance of premium, pro-level performance in a resilient titanium frame only 5.8mm thick.1 S25 Edge delivers on the S series legacy, integrating an iconic Galaxy AI-enabled2 camera and unleashing a new realm of creativity in an effortlessly portable device.
    “Galaxy S25 Edge is more than a slim smartphone. The superior engineering that brought this revolutionary smartphone to life illustrates a commitment to overcoming barriers that helps Galaxy deliver truly unexpected premium experiences for people around the world,” said TM Roh, President and Acting Head of the Device eXperience (DX) Division at Samsung Electronics. “S25 Edge not only marks a breakthrough for its category, but it also accelerates important innovation across the mobile industry.”
    Exceptionally Sleek and Strong Design
    With a thin 5.8mm chassis and weighing in at just 163 grams, Galaxy S25 Edge is a remarkable feat of engineering that reimagines nearly every element of smartphone design for an even more compact and convenient experience. This refined design bridges form and function, taking slim smartphones to the next level while staying true to the Galaxy S series’ unified design.
    Alongside its streamlined silhouette is an exceptionally resilient device. The optimally curved edges of the sturdy titanium frame offer enduring protection for everyday use.  The latest Corning® Gorilla® Glass Ceramic 2, a new glass ceramic offering that delivers engineered resilience, is used for the front display to yield both vibrancy and strength on Galaxy S25 Edge.
    Dynamic Creativity with a Pocketable 200MP Camera
    The slim and light design of Galaxy S25 Edge makes it easier than ever for users to capture memorable moments and express their creativity anytime, anywhere. The 200MP wide lens upholds the Galaxy S series’ iconic camera experience including Nightography. Thanks to its ultra-high resolution, users get sharp photos while maintaining clear shots with the large pixel size — capturing images with over 40% improved brightness3 in low-light environments. The 12MP ultra-wide sensor features autofocus, powering crisp, detailed macro photography for even more creative flexibility.
    Galaxy S25 Edge benefits from the same ProVisual Engine that was optimized for Galaxy S25 with pro-grade enhancements, like ensuring sharp details for clothes or plants, and natural, true-to-life skin tone in portraits.4 Galaxy AI-powered editing features,5 including fan-favorites like Audio Eraser6 and Drawing Assist7 are all brought over from the Galaxy S25 series, pairing advanced creative and editing tools with a never-before-seen slim form factor.
    Peak Performance Expertly Configured in Ultra-Slim Housing
    Galaxy S25 Edge is built to deliver premium performance, starting with the Snapdragon 8 ® Elite Mobile Platform for Galaxy, the same processor available in all Galaxy S25 series devices globally. Customized by Qualcomm Technologies, Inc., the chipset powers Galaxy S25 Edge’s on-device AI processing capabilities and offers reliably fast performance all day.8 Galaxy S25 Edge also features a reconfigured vapor chamber that is now thinner, yet broader for steady heat dissipation.
    Matching the Galaxy S series’ renowned performance standards, Galaxy S25 Edge features advanced, efficient AI image processing with ProScaler,9 which delivers a 40% improvement10 in display image scaling quality, while incorporating Samsung’s customized mobile Digital Natural Image engine (mDNIe) — improving power consumption, so you can enjoy peak performance for longer.
    A Trusted Companion with Galaxy AI
    Integrating Galaxy AI at nearly every touchpoint, Galaxy S25 Edge offers our most natural and context-aware mobile AI experiences. Users get personalized, multimodal AI capabilities with peace of mind that their data is secured.
    Mirroring the broader Galaxy S25 series, Galaxy S25 Edge integrates AI agents that work seamlessly across multiple apps, serving as a true AI companion to get things done more easily. Galaxy AI also gets better at integrating with daily routines. Now Brief11 and Now Bar12 include third-party app integrations for greater convenience and helpful reminders during everyday commuting, dining, and more.
    Thanks to Galaxy’s deep integration with Google, Galaxy S25 Edge brings Gemini’s13 latest advancements to more users. For example, with Gemini Live’s14 new camera and screen sharing abilities, users can show Gemini Live what they see on their screen or in the world around them while simultaneously interacting with it in a live conversation.
    Experiences powered by Galaxy AI on Galaxy S25 Edge aren’t just convenient — they’re designed with privacy at the core. On-device AI processing ensures data is kept secure by Samsung Knox Vault,15 continuing Samsung’s unwavering commitment to ensure hyper-personalized mobile experiences while prioritizing privacy.
    Rooted in craftsmanship and driven by performance, Galaxy S25 Edge delivers pro-level photography, personalized AI experiences, and more. It goes beyond a slim form factor to challenge expectations for what a smartphone can be.
    Your Digital Essentials Always by Your Side
    Galaxy S25 Edge opens access to Samsung’s wide range of features and services to help you live your best life
    Samsung Health offers extensive fitness and health tracking, sleep coaching, personalized guides, and wellness tools to help you reach your goals without a subscription fee.
    Samsung Wallet is a convenient way to keep and use many of your most essential digital items securely on your phone including payment cards, digital keys, boarding passes, mobile driver’s license, student ID, and more.
    Galaxy S25 Edge will enable users to take advantage of Samsung Wallet’s soon-to-be-released Tap to Transfer feature. This enables quick6 and convenient peer-to-peer (P2P) payments by using the debit card stored in Samsung Wallet to send money directly to friends and family members’ bank account. No additional apps needed, and transfers are seamless between digital wallets — all it takes is a tap to transfer.17
    Availability
    Galaxy S25 Edge is available for pre-order starting today, May 12, at Amazon, Best Buy, and Samsung.com, and from carriers nationwide, with general availability starting on May 30, 2025.
    Galaxy S25 Edge starts at $1,099.99 for the 256GB storage option and $1,219.99 for 512GB. It comes in stylish Titanium Silver, Titanium Jetblack, and Titanium Icyblue colors options.
    Preorder now through May 30 on Samsung.com or the Shop Samsung app to receive up to $800 in total savings. Claim a $50 credit just by pre-ordering,18 plus if you select the 256GB storage model, you will receive the 512GB model at no additional charge19 — that’s a value of $120. For extra savings, trade-in an eligible device and receive up to $630 in credit towards your purchase of Galaxy S25 Edge.20
    For more information about Galaxy S25 Edge and the Galaxy S25 series, please visit: Samsung Newsroom, SamsungMobilePress.com or Samsung.com.

    Galaxy S25 Edge
    Display6.7-inch* QHD+  
    Dynamic AMOLED 2X Display   
    Super Smooth 120Hz refresh rate (1~120Hz)    
    Vision booster  
    Adaptive color tone  
    *Measured diagonally, Galaxy S25 Edge’s screen size is 6.7-inch in the full rectangle and 6.5-inch with accounting for the rounded corners; actual viewable area is less due to the rounded corners and camera hole.
    Dimensions & Weight75.6 X 158.2 X 5.8mm, 163g
    Camera12MP Ultra-Wide Camera    
    • F2.2    
        
    200 MP Wide Camera    
    • OIS F1.7, 2x optical quality zoom, up to 10x AI zoom
           
    12MP Front Camera    
    • F2.2
    Memory & Storage12 + 512GB   
    12 + 256GB   
    *Available storage capacity is subject to preloaded software.
    Battery3,900 mAh
    *Typical value tested under third-party laboratory condition. Typical value is the estimated average value considering the deviation in battery capacity among the battery samples tested under IEC 61960 standard. Rated (minimum) capacity is 3786mAh. Actual battery life may vary depending on network environment, usage patterns and other factors.   
    Charging*  Wired charging*: Up to 55% charge in around 30 mins with 25W Adapter**   
    Fast Wireless Charging ***   
    Wireless PowerShare****   
    *Wired charging compatible with QC2.0 and AFCPD.
    **25W Power Adapter sold separately. Use only Samsung-approved chargers and cables.
    ***Wireless charging compatible with WPC.
    ****Limited to Samsung or other brand smartphones with Qi wireless charging, such as Galaxy S24 Ultra, S24+, S24, S23 Ultra, S23+, S23, Z Fold4, Z Flip4, S22 series, Z Fold3 5G, Z Flip3 5G, S21 FE 5G, S21 series, Z Fold2, Note20 series, S20 series, Z Flip, Note10, Note10+, S10e, S10, S10+, Fold, S9, S9+, S8, S8+, S8 Active, S7, S7 edge, S7 Active, S6, S6 edge, S6 Active, S6 edge+, Note9, Note8, Note FE and Note5. Only available with certain Samsung Galaxy wearables such as Galaxy Buds FE, Buds2 Pro, Buds2, Buds Pro, Buds Live, Watch6, Watch6 Classic, Watch5, Watch 5 Pro, Watch4, Watch4 Classic, Watch3, Watch Active2, Watch Active, Gear Sport, Gear S3, Galaxy Watch and Galaxy Buds. If battery power is lower than 30% Wireless PowerShare may not function. May not work with certain accessories, covers, other brand devices or some Samsung wearables. During PowerShare, it may affect call reception or data services, depending on your network environment.   
    OSAndroid 15
    One UI 7
    Network and Connectivity5G*, LTE**, Wi-Fi 7***, Wi-Fi Direct Bluetooth® v 5.4
    *Requires optimal 5G network connection. Check with your carrier for availability and details. Download and streaming speeds may vary based on content provider, server connection and other factors.   
    **Availability of LTE model varies by carrier. Actual speed may vary depending on carrier, and user environment.   
    ***Wi-Fi 7 network availability may vary by network provider and user environment. Requires optimal connection. Will require a Wi-Fi 7 router.
    Water ResistanceIP68
    *IP68 Rating: Water and dust resistant based on lab test conditions for submersion in up to 1.5 meters of freshwater for up to 30 minutes. Rinse residue/dry after wet. Not advised for beach or pool use. Water and dust resistance of your device is not permanent and may diminish over time. Water and dust resistance of the S Pen may also diminish over time because of normal wear and tear.
    1 Excluding camera lenses.
    2 Galaxy AI features by Samsung are free through 2025 and require Samsung account login.
    3 Compared to Galaxy S25 and Galaxy S25+.
    4 Results may vary depending on light condition and/or shooting condition including multiple subjects, being out of subject, or moving subjects.
    5 Galaxy AI features by Samsung are free through 2025 and require Samsung account login.
    6 Compatible with common video formats accessible in Gallery; helps minimize six sounds (Voice/speech, Music, Noise, Crowd, Nature, Wind) utilizes AI; results may vary.
    7 Drawing assist feature requires a network connection and Samsung Account login. A visible watermark is overlaid on the image output upon saving in order to indicate that the image is generated by AI. The accuracy and reliability of the generated output is not guaranteed.
    8 Based on average battery life under typical usage conditions. Average expected performance based on typical use. Actual battery life depends on factors such as network, features selected, frequency of calls, and voice, data, and other application usage patterns. Results may vary.
    9 Available on Galaxy S25 Edge, Galaxy S25 Ultra, and Galaxy S25+ only; requires screen resolution setting to QHD+.
    10 13 Compared to Qualcomm Snapdragon® 8 Gen 3 on Galaxy S24 series based on PSNR (Peak Signal-to-Noise Ratio) test.
    11 Displays daily select information from select apps (some apps may require internet connection and/or consent to access data). Personal data intelligence must be enabled.
    12 Requires WIFI connection and Samsung and Google accounts.
    13 Product functionality may be dependent on your app and device settings. Requires internet connection. Results may vary depending on visual matches. Gemini is a trademark of Google LLC.
    14 Results for illustrative purposes and may vary. Check responses for accuracy. Compatible with certain features and with certain accounts. Internet connection required. Available on select devices, languages, and countries. Only available to users 18 years and older.
    15 Galaxy AI Personal Data Engine secures select data from select apps on device in Knox Vault. Galaxy AI features by Samsung are free through 2025 and require Samsung account login.
    16 Actual funds availability varies depending on receiving financial institutions. Service provided by Green Dot® ©2025 Green Dot Corporation.  All rights reserved. Green Dot Corporation NMLS #914924; Green Dot Bank NMLS #908739.
    17 Requires a contactless enabled Visa or Mastercard debit card from a participating U.S. bank. Fees and limits apply. Your financial institution or mobile carrier may charge you. See Samsung.com for details.
    18 5/12/25 – 5/30/25, pre-order the latest Galaxy S25 Edge device on Samsung.com or in the Shop Samsung App and receive a $50 Samsung Credit (“Reservation Gift”) when you pre-order and purchase the device. Pre-order and purchase required. The Reservation Gift cannot be applied to the pre-ordered device(s) and must be used at the time of pre-order purchase towards purchasing additional eligible products on Samsung.com, or in the Shop Samsung App. Reservation Gift will be applied automatically when you use the same email address during Reserve and Pre-order Periods. Reservation Gift is a one-time use e-certificate; when first used, any value not used is lost and must be used at the time of purchase. The Gift is non-transferable and limited to 1 per Qualifying Purchase. If you return or cancel your purchase, the discount will be forfeit.
    19 5/12/25 – 5/30/25, while supplies last, purchase a Galaxy S25 Edge 512GB (“Qualifying Purchase”) for the price of the next lowest storage level (“Gift”) at samsung.com or the Shop Samsung app. Portion of storage/memory occupied by existing content. The discount will be automatically applied at checkout. The Gift is non transferrable and limited to 1 per Qualifying Purchase. If you return or cancel your purchase the discount will be lost.
    20 For a limited time only, on Samsung.com/Shop Samsung App, or purchase a new qualifying Galaxy device (“Qualifying Purchase”), send in your qualifying trade-in device to Samsung through the Samsung Trade-In Program, and if Samsung determines your trade-in device meets all eligibility requirements, you will receive a trade-in credit specific to your qualifying trade-in device to apply toward your Qualifying Purchase. Device models that currently qualify for trade-in and trade-in credit amounts associated with those models are available on Samsung.com and the Shop Samsung App; eligible models and amounts may change at Samsung’s sole discretion. To be eligible for trade-in, your qualifying device must meet all Trade-In Program eligibility requirements, which include, but are not limited to, that the device powers on, holds a charge, and does not power off unexpectedly; has a functioning display; has no breaks or cracks in the screen (unless a cracked screen offer applies); has no breaks or cracks in the case; has no liquid damage (whether visible or not); has no other defects that go beyond normal wear and tear; is not on a black list; has a verified FCC ID; has been reset to factory settings; has all personal information removed; has all software locks disabled; and is owned by you (leased devices are not eligible). Anticipated trade-in value will be applied as a credit at time of purchase, but, if you do not send in your trade-in device within 15 days of receipt of your Qualifying Purchase, you will be charged back for the trade-in credit applied to your purchase, or if you send in your trade-in device within 15 days of receipt of your Qualifying Purchase but Samsung determines your device does not meet all eligibility requirements, you will be charged back for the trade-in credit applied to your purchase minus $25. Participation in this program does not excuse you from contracts with your carrier or retailer (or any related payments or fees) for the device that was traded in. Limit 1 trade-in per Qualifying Purchase. Samsung reserves the right to modify or discontinue this offer at any time. The Trade-In Program cannot be combined with any other Samsung, carrier or retailer promotions, discounts, or offers unless specifically provided for in the terms and conditions of such offers. Additional terms, including terms that govern the resolution of disputes, apply.
    * All functionality, features, specifications and other product information provided in this document including, but not limited to, the benefits, design, pricing, components, performance, availability, and capabilities of the product are subject to change without notice.

    MIL OSI Economics

  • MIL-OSI New Zealand: Revolutionising Predator Control: A New Wave of Tech Tools Accelerating New Zealand’s Predator Free Mission

    Source: Predator Free 2050

    Aotearoa New Zealand’s fight for a predator free future has taken a bold leap forward, with a powerful suite of next-generation tools and technologies already starting to transform pest management across the motu.
    Developed through Predator Free 2050 Limited (PF2050 Limited) Products to Projects (P2P) funding of innovation since 2019, 20 cutting-edge tools are becoming operational with more on the way. These tools range from AI-driven detection systems and remote monitoring networks to smarter traps and more targeted toxin use.
    Over $8 million in revenue sales to developers has been accomplished to date, with further commitments to purchase from interested parties later this year. A number of these tools are also gaining international attention with sales as far afield as Guam, Scotland, USA and the UK. Not only is this good news for the developers, it’s also further growing New Zealand’s reputation as global leaders in pest management for conservation.
    “These tools are game-changers,” says PF2050 Limited Research and Development Project Support Manager Olivia Rothwell. “For example, the ‘Backcountry Camera’, a remote-reporting thermal camera with onboard AI image recognition, is enabling the maintenance of tens of thousands of hectares of predator free space in Predator Free South Westland.”
    ‘’This is no longer just about one device. It’s an ecosystem of tools-powered by cutting-edge technology, informed by our in-depth knowledge of possums, rats and mustelids, and brought together through local innovation to protect our native species,” Rothwell says.
    The Toolbox
    Better Luring
    – PoaUku- Developed by Boffa Miskell, these long-life ceramic-based lures can stay attractive in the field for up to three months and be refilled when they run out. Two versions are available – one for mustelids (stoats, ferrets and weasels) and one for possums and rats.
    – EzyLure- Developed by Boffa Miskell, this is a set-and-forget device that automatically dispenses fresh lure at pre-determined intervals. It can be retrofitted to a wide range of existing traps and bait stations and paired with trail cameras for effective monitoring.
    – Motolure- Developed by Zero Invasive Predators, Motolure dispenses a preset amount of fresh lure for up to one year without requiring manual service. It can be used as a lure for traps, a prefeeding tool, a detection device, and a biomarker tool to monitor predator movements.
    Remote Monitoring
    – BaitSense- Developed by eTrapper, Baitsense provides a near real-time view of levels in mini Philproof Gen III baitstations. Data is remote-reported and displayed on the Trap.NZ web platform, making it free for the user to be notified if bait is being taken or if a refill is required.
    – Backcountry Camera- Developed by Zero Invasive Predators, is a remote-reporting thermal video camera with onboard AI image recognition that supports landscape-scale predator surveillance across tens of thousands of hectares in Predator Free South Westland.
    – Smart Camera Monitoring System- Developed by Critter Solutions, this trail-camera with onboard AI image recognition and thermal triggering offers improved detection and species recognition. The camera can also send alerts of images taken of target species in real-time.
    Remote Communication
    – OutPost- Developed by Zero Invasive Predators, this is a remote communication system for traps and detection cameras. Outpost can be paired with a range of devices and utilises LoRaWan to send data out of remote landscapes where there is no cell connectivity.
    – Flexicomms- Developed by Critter Solutions, Flexicomms is a remote communication platform (web-based front and back end) developed for trap and detection device integration. Currently a cell-based version, it will also utilise OneNZ direct-to-satellite IoT technology.
    – Connected Leg-Hold Traps- Developed by Encounter Solutions, this system enables real-time notification from, and monitoring of, leg-hold traps over even challenging topographies (utilising the Celium network, a dynamic low-power long-range communication system).
    – Live Capture Remote Locking- Developed by Encounter Solutions, also utilising the Celium network, this system allows users to remotely lock live capture cage-traps, ensuring that animal welfare is maintained when staff are unable to physically disable live capture traps.
    Supporting Software
    – CamTrap- Developed by Manaaki Whenua Landcare Research, this free to use AI image recognition software can identify 11 species and supports the rapid assessment for predator detection of images that standard motion-triggered cameras (‘trail cameras’) produce.
    – Open Sensor Network- Developed by Trap.NZ and using LoRaWAN (a low power long range wide area network protocol), this enables ‘off-the-shelf’ hardware to send trap-trigger alerts and data directly to the Trap.NZ platform (a free predator control data management app).
    – Deployment & Planning Module- Developed by Trap.NZ, these new functions enable Trap.NZ users to better plan predator trapping deployment within the Trap.NZ web app. Recording functions also help users to keep track of landowner permissions and device installations.
    Self-resetting Traps
    – AT220- Developed by NZ AutoTraps, the AT220 is New Zealand’s first multi-species, automatic resetting and re-luring predator trap, controlling both possums and rats for predator free. It has been shown to quickly and effectively control pest populations with minimal labour costs.
    – Multi-species AI Kill Trap- Developed by Critter Solutions, this trap with AI species recognition targets mice, rats, mustelids and possums with the highest animal-welfare rating. With open architecture, it can target shy pests while protecting native wildlife.
    High-interaction Rate Traps
    – High Interaction Rate Trap- Developed by The Cacophony Project, this earlier version of the High Interaction Rate Trap is an open-architecture motion-sensing multi-species cage trap, ideal for targeting remaining hard to control predator individuals, or those re-invading.
    – Intelligent High Interaction Rate Trap- The Cacophony Project further developed their trap to include a PIR (passive infrared red) sensor and an automated reset mechanism, further improving its sensitivity for capturing predators and allowing it to be deployed for longer.
    – PosStop- Developed by Zero Invasive Predators, this is an improved raised set for the leg-hold trapping of possums, still one of the best approaches that we have for helping to eliminate remaining possum individuals following their knock-down control in backcountry landscapes.
    Selective Toxin Application
    – Wildlife Friendly Bait Station- Developed by Zero Invasive Predators, this bait station effectively delivers toxic bait to predators over long periods while ensuring that non-targets cannot access the bait (with a focus on being safe for kea in backcountry landscapes).
    – Possum Spitfire- Developed by Envico Technologies, the Spitfire is a self-resetting, species-specific toxin delivery device, that uses a sensor array to accurately spray liquid toxin onto the stomach of only possums (and no other species), which is then ingested during grooming.
    Latest Technology Videos 
    https://youtu.be/0KMzv6scjss – Envico Technologies Limited
    https://youtu.be/zZO-j1lroIg – Encounter Solutions 
    https://youtu.be/N4Ic7u1A8FI – Manaaki Whenua Landcare Research
    https://youtu.be/TgQpbaC58II – Critter Solutions
    https://youtu.be/xJ3w7PjfhIg – Zero Invasive Predators

    MIL OSI New Zealand News

  • MIL-OSI New Zealand: Chris Hipkins: Pre-Budget speech

    Source: New Zealand Labour Party

    So as we gather here for an early conversation about next week’s Budget, it’s also a good time for us to have some hard, and honest, conversations about the crossroads our country finds itself at.

    We’re at a moment that demands honesty. A moment that demands leadership. And above all, a moment that demands hope.

    I want to say upfront that paying for your Budget at the expense of women, cutting their chance at fair pay, is the opposite of all of those things.

    I think the reaction over the past week has been swift, strong and utterly justified.

    Women all over this country rightly felt like pay equity was something they had fought for, in some cases devoting their lives to it. It was hard fought, and we were making progress.

    Let’s be clear – this Government is gaslighting all Kiwi women.

    Telling them they aren’t cutting women’s pay on one hand, while cancelling 33 active claims representing hundreds of thousands of women with no due process on the other.

    Claiming it wasn’t to pay for their Budget, then admitting their changes will see billions slashed from that same Budget.

    I think one of the many reasons this is resonating so strongly is because for many Kiwis, the promises they were sold at the last election have turned to dust.

    They were told the economy would be stronger. But it’s slower.

    They were told the cost of living would come down. But prices have gone up.

    They were told families with kids would get an extra $250 a fortnight to help with the cost of living, yet only a handful, if that, are getting it.

    They were told a new government would get things moving, and yet building projects have ground to a halt and 13,000 people working in construction lost their jobs.

    They were told the country would be united. But it’s more divided than ever.

    And at every turn, when people ask ‘why can’t we invest in our schools, in our hospitals, in our future?’ the government is giving them the same answer:

    “There’s no alternative.”

    Well, let me be clear: there is always an alternative. There are always choices.

    And this government is making the wrong ones.

    A $3 billion tax break for landlords while cutting funding for pay equity for women.

    A rollback of our world-leading smoke-free laws while giving tobacco companies over $200 million in tax breaks.

    Borrowing $12 billion for tax cuts while cutting jobs, cutting investment, and cutting hope for future generations.

    They are choosing austerity. Nicola Willis doesn’t like that word, but it is absolutely true. Choosing decline. Choosing division.

    But we in Labour are choosing a different path. A better path. A fairer path. One that puts people at the heart of our economy and decency back at the heart of our politics.

    Because we’ve done it before, and we can do it again.

    There are challenges ahead. Challenges like the rise of artificial intelligence and the changing nature of work that’s going to prompt.

    The climate crisis, and the energy transition that’s going to demand.

    An ageing population, in need of care and dignity.

    The widening gap between rich and poor, between city and region, between young and old.

    And the creeping polarisation that seeks to divide us, when what we need most is to come together.

    What’s this government’s response now to these challenges?

    Deregulate here. Privatise there.

    If it moves, sell it. If it breaks, blame someone else.

    This is a government more interested in finding someone else to blame than solving the problems facing the country.

    They’re trying to solve the challenges of the 21st century with ideas from the 19th.

    They have no plan for the future. Just slogans and spreadsheets.

    But we do have a plan. A serious, credible, ambitious plan one that is rooted in fairness, decency, and community. One that believes in people. One that backs New Zealand.

    Labour is the party that governs for all, not just a few.

    Let’s start with the economy—because you can’t build anything if your foundations are crumbling.

    The current government loves to repeat the myth that New Zealand is drowning in debt.

    Let’s look at the facts. Before COVID-19 arrived, our net core Crown debt was around 18%. After the pandemic, it peaked at 40%. That’s an increase—but it’s broadly in line with what National borrowed during the Global Financial Crisis, when they increased debt by 20%.

    And if you include our assetts—like the New Zealand Super Fund—our net debt falls closer to 25%. That’s still one of the lowest levels in the developed world.

    You wouldn’t sell your house because of a mortgage you can easily manage. And we shouldn’t sell our public assets because of debt that’s low by international standards.

    And net debt isn’t the full story either. The government’s net worth more than doubled over the past decade —from $81 billion in 2014 to $191 billion in 2023.

    We need a more mature conversation about government debt and assets than the one that we are having at the moment.

    Borrowing more money to support a higher number of people on unemployment benefits because you’ve slashed government investment in areas like infrastructure and housing simply isn’t sustainable.

    Now is exactly the time for government to make the investments we need in infrastructure, housing, health, and our environment so we are creating jobs and get New Zealand moving again.

    Anchor projects funded by government have helped us get through major economic shocks before, like the rollout of broadband during the GFC. They create jobs, stimulate the economy, and leave a positive legacy for the future.

    Yet all we’ve seen from this government so far is big talk about a pipeline of future projects that’s yet to eventuate. In fact, the opposite has happened. They spent less last year than the year before.

    All the big talk about infrastructure is actually resulting in less investment in it.

    Talking about economic growth without actually having a plan to deliver it just doesn’t cut it.

    Labour will get New Zealand back to work, just as we’ve done before.

    We didn’t get everything right in government, but let’s put a few facts on the table.

    GDP per person grew by $18,000 under the last Labour government—more than under either the Clark or Key governments, despite the fact we were in office for 3 years less than both of those predecessor governments.

    And wages? Under Bolger and Shipley, ordinary hourly pay grew by $3.30 over nine years. Under Clark, $7.22. Under Key and English, $6.29. Under Ardern and Hipkins? $9.98.

    We grew the economy faster. We lifted wages faster. We created more jobs. Unemployment was lower.

    So when the government tells you there is no alternative to cuts—don’t believe it. There is.

    But it’s not just about numbers. It’s about values.

    If we are genuinely going to turn things around, and provide New Zealanders with hope and the opportunity of a better future, this year’s Budget will need to do three things.

    First, it will need to properly fund our frontline public services like health, education, aged care and police.

    National promised New Zealanders before the election frontline public services wouldn’t be cut, yet hiring freezes in health, cuts to specialist teachers, and cruel cuts to disability support all serve as vivid examples that just wasn’t true.

    Second, it will need to provide a credible answer to how the government is going to fund all of its promises, and that should not be at the expense of working New Zealand women.

    They’ve committing billions in infrastructure investment, for example, but still haven’t said how they will pay for it all.

    Third, they need to show they have a plan to invest in our future. To rebuild our ageing schools, hospitals, public homes and infrastructure. To create jobs, upskill our workers, and raising wages and living standards.

    Because fundamentally, good economic management is about people. Shifting numbers around on a page while making life harder for everyday working Kiwis is not a sign of success.

    How can we look our kids in the eye when we give $3 billion tax break to landlords—while cutting funding for food banks?

    How can we justify increasing returns for landlords while we cut the pay of those who clean our hospitals and protect our schools?

    We can’t. We won’t and we shouldn’t.

    Labour is not anti-wealth. We are anti-poverty. And we are pro-opportunity—for everyone.

    We believe in a fair tax system, and you’ll hear more from us on that soon. Not to punish success, but to ask those who have benefitted most to contribute their fair share—to the schools that taught them, the roads that connect them, and the hospitals that care for their families.

    Because you can’t build a strong economy on a weak society.

    We want to build a country where our kids don’t feel they have to leave New Zealand to build a life for themselves.

    Where our elders can live with dignity.

    Where no child goes hungry.

    Where our businesses thrive.

    Where being a nurse, a teacher, or a farmer isn’t a path to burnout—but a path to pride.

    We want New Zealand to be a place where our best and brightest don’t just want to stay—but they can stay. Because there is opportunity here. Hope here. A future here.

    We know the future will test us. Artificial intelligence is going to change how we work. Climate change is going to challenge how we live. New technologies will transform jobs and our industries.

    But these aren’t reasons to fear the future. They are reasons to shape it.

    And that’s exactly what Labour will do.

    We will invest in green energy and the industries of tomorrow.

    We will reform our education system so that we prepare young people for the jobs of the future—not the jobs of the 19th century.

    We will make sure that new technologies benefit everyone, not just the few.

    We will build homes—not sell them off.

    We will protect our environment—not carve it up and privatise it.

    And need to focus on uniting this country—not driving division.

    Because diversity is not a weakness. It is our greatest strength.

    Whether you are Māori, Pākehā, Pasifika, Asian, or new to this land—you are all Kiwis.

    Whether you’re a nurse in Palmerston North, a teacher in Ōtaki, a small business owner in Timaru, a cleaner in South Auckland, a builder in Rotorua, or a farmer in Wairoa – your contribution matters.

    Whether you’re young or old, rich or poor, gay or straight or transgender, Labour sees you. Labour hears you. Labour is fighting for you.

    Because what unites us is far greater than what divides us.

    We are a nation of workers and dreamers, of creators and carers.

    We believe in fairness. In decency. In community.

    And we believe the role of government is not to sit on the sidelines—it’s to step up, to help, to serve.

    This government is making different choices. Choosing a lucky few, over the rest of us.

    And those choices show us, more than anything, what kind of country this government wants to build.

    But I ask you: is that the country we want?

    A broken health system.

    Children going to school hungry.

    People sleeping in cars.

    And a generation—our kids—growing up believing they may never own a home, never raise a family, never build a future here.

    Or do we want a New Zealand where everyone gets a fair go?

    Where the dignity of work is restored, the promise of opportunity renewed, and the bonds of community rebuilt?

    We’re not here to manage decline. We are here to build the future.

    A future where prosperity is shared.

    Where no one is left behind.

    Where we choose hope over fear.

    Where we say to the next generation: yes—you can dream here. You can build here. You can stay here.

    We’ve done it before.

    And with your support, we’ll do it again.

    Let’s build a better way. Together.

    Kia kaha. Kia māia. Kia manawanui.

    Thank you.

    MIL OSI New Zealand News

  • MIL-OSI New Zealand: Tupu Accelerator continues to nurture seeds of Māori startup economy

    Source: Tapuwae Roa

    Tapuwae Roa has welcomed ten Māori-founded startups into the 2025 Tupu Accelerator cohort, continuing its mission to grow the Māori startup ecosystem in Aotearoa.
    Delivered in partnership with Sprout Agritech and co-funded by Callaghan Innovation, the eight-week programme now enters its second year and continues its mission to provide intensive support to early-stage Māori founders.
    Participants will work with experienced coaches to refine their business models, strengthen operational capability, and prepare for investment, and present at a capstone showcase in June.
    Recent research commissioned by Tapuwae Roa found that just 5% of Aotearoa’s 2400 startups have Māori founders. The findings also highlighted key challenges for Māori founders, including limited access to investment, capability-building opportunities, and a lack of cohesive support networks.
    Tupu aims to address these gaps by providing a kaupapa-Māori approach to business support, with structured guidance, grounded mentorship, and a platform to scale.
    For BEINGS founder Léon Bristow (Ngāpuhi, Ngāti Manu), joining the cohort is an opportunity to grow alongside others who share a values-based approach to business.
    “I’m genuinely moved to have been selected for this year’s Tupu Accelerator programme. Coming from an industry with only 4% Māori, I look forward to being supported by others who see pakihi through a similar lens. This experience will not only benefit my own professional and personal growth, but hopefully other Māori that I hope to influence and inspire,” says Bristow.
    Lui Hellesoe (Tūhoe), founder of KiwiData, says Tupu provides the structure and support to grow a business grounded in kaupapa Māori.
    “Getting into the Tupu Accelerator is a big step for me and for KiwiData. I built this company to solve real problems that Māori and Pacific businesses face when it comes to AI. This opportunity gives me the support and backing to grow something that reflects who we are and how we work. It means I can build with purpose, stay grounded in our values, and scale a business that creates space for our people in the future of tech.”
    The 2025 Tupu Accelerator Showcase will be held on 26 June 2025 at the Auckland Art Gallery. Earlybird tickets are on sale now for $110 +GST: https://tupu2025.lilregie.com
    TUPU ACCELERATOR 2025 COHORT:
    To read more about the cohort and their pakihi please visit: https://tupu.org.nz/purapura
    • Green Waste Products NZ: Koro Carman (Ngāpuhi) & Simon Tanner
    • Girl Native: Rawinia Rimene (Whakatōhea)
    • BEINGS: Léon Bristow (Ngāpuhi, Ngāti Manu)
    • Performnz IQ: Pele Aumua (Ngāi Tahu/Kāi Tahu) & Maraki Aumua (Ngāi Tahu/Kāi Tahu)
    • Makachilli: Hira Nathan (Ngāti Kahungunu ki Heretaunga)
    • KiwiData: Lui Hellesoe (Tūhoe)
    • Aro: Tina Wickliffe (Ngāti Porou)
    • Mauriora Kombucha: Tamara Kirwan (Ngāti Tūwharetoa), Julian Kirwan (Ngāti Tūwharetoa) & Keela Atkinson (Ngāti Kahungunu ki Heretaunga)
    • Plunge Lab: Oliver George (Tūhourangi) & Teancum Kahaki (Ngāti Porou)
    • Takesfour: Jenny Steward (Ngāti Maniapoto) & Renee McCallum (Ngāti Pikiao/Te Arawa) 

    TE ARA TAKATŪ: PATHWAYS FOR MĀORI ENTREPRENUERSHIP RESEARCH REPORT Te Ara Takatū explores Aotearoa New Zealand’s venture capital ecosystem and provides supportive advice and insights to Rakahinonga Māori (Māori entrepreneurs) to become ‘investment ready’, navigate their pathways, and become more successful in the early stages of startup growth. As a joint research endeavour by Tapuwae Roa and PWC New Zealand, with support from New Zealand Trade & Enterprise, this report seeks to provide the playbook for Māori startups on the path to gaining investment. Read the full report here: https://www.tapuwaeroa.org/te-ara-takatu/

    MIL OSI New Zealand News

  • MIL-OSI New Zealand: Peace Action Wellington Statement – Mahia: now a US nuclear base?

    Source: Peace Action Wellington

    13 May 2025 – The US military has indicated it wants to increase the number of space launches from Rocket Lab’s launchpad on the Mahia Peninsula including launching satellites involved in nuclear command-control-and-comms. 

    “This raises serious questions about compliance with New Zealand’s Nuclear Free legislation,” said Valerie Morse, member of Peace Action Wellington.

    “We have been very concerned that the national security assessments by MBIE of Rocket Lab launches are insufficient. In particular, US military launches that are ‘classified’ means that New Zealand officials have very little knowledge about the military capabilities and targets of these satellites.”

    “The Ministry of Business Innovation and Employment who oversee space launches specifically state that ‘payloads that contribute to nuclear weapons programmes or capabilities” are expressly prohibited. Yet without the actual access to classified information from the US we have incomplete information about what these satellites do.”

    “Moreover the integration and consolidation of command systems means that satellites may serve multiple outcomes including the operation of nuclear weapons. The US’s Joint All-Domain Command and Control or CJADC2 is the concept that the Department of Defense has developed to connect sensors from all branches of the armed forces into a unified network powered by artificial intelligence.”

    “Mahia has become a de facto outpost of the US military where it can do what it wants, when it wants with very little real oversight and no concern for the implications of that for New Zealand independence as a nation. ”

    “The threat of nuclear war is at the highest level it has been at in 40 years. New Zealanders rejected nuclear weapons two generations ago, we should not give up our principled stand under any circumstances, but particularly not by stealth under the cover of US ‘classified’ programmes.” 

    Notes

    MIL OSI New Zealand News

  • MIL-OSI New Zealand: Emerging tech entrepreneurs from Southeast Asia to visit New Zealand this month

    Source: Asia New Zealand Foundation

    Ten emerging tech entrepreneurs from Southeast Asia will visit New Zealand from 18-25 May to meet with leading innovators and businesses and attend a number of tech events.
    Their visit is part of the ASEAN Young Business Leaders Initiative (YBLI), managed by the Asia New Zealand Foundation on behalf of the Ministry of Foreign Affairs and Trade.
    The initiative facilitates trade and builds networks and connections between entrepreneurs and business leaders in Southeast Asia and in New Zealand.
    The delegation represents a diverse mix of cutting-edge sectors, including med-tech, AI, digital mobility and eCommerce. Fam Alonto, a participant from the Philippines and founding partner of Embiggen Group, says:
    “I believe innovation happens through meaningful relationships and open collaboration. The YBLI programme is a great chance to connect, learn and build partnerships across ASEAN and New Zealand. For me, this visit is about more than business-it’s about building relationships that spark real ideas.”
    Dr Elaine Chan, co-founder and CEO of Vidanex, Malaysia, adds:
    “As a medtech entrepreneur based in Kuala Lumpur, I’m looking forward to meeting other innovators from Southeast Asia [on the delegation] and learning about New Zealand’s health tech scene. This visit is a great chance to learn from each other and explore ways we might work together in the future.”
    During their week-long programme, the group will meet with New Zealand companies such as Sharesies, Partlyand Outset Ventures, and engage with startup and innovation communities in Auckland, Wellington and Christchurch.
    The visit will conclude with the NZ Hi-Tech Awards gala dinner, one of New Zealand’s premier events celebrating innovation and technological excellence.
    Asia New Zealand Foundation Chief Executive, Suzannah Jessep, said the visit reflects the best of how the YBLI programme is evolving – bringing in dynamic, cutting-edge innovators to brainstorm and share ideas with their New Zealand-based counterparts.
    “To date, we have worked with hundreds of entrepreneurs and seen many partnerships and ideas flourish. Southeast Asia is a region of growing importance for New Zealand. Through initiatives like YBLI, and with the support of the Ministry of Foreign Affairs and Trade, we’re helping to lay the groundwork for future partnerships and cross-border collaboration.”
    Since its inception in 2011, the ASEAN Young Business Leaders Initiative has facilitated visits for more than 130 ASEAN entrepreneurs to New Zealand and supported over 80 New Zealand entrepreneurs in exploring opportunities in Southeast Asia. In total, the YBLI Network numbers over 270 entrepreneurs.                               
    For more information, contact: Taniya Scott, director communications and media | Asia New Zealand Foundation | email: tscott@asianz.org.nz
    Meet the 2025 ASEAN YBLI Tech delegation:
    • Anugrah Nurrewa – Founder and CEO, Komuto (Indonesia): Delivering real-time urban mobility solutions for public transport.
    • Dr Darren Gouk – Founder, AOne (Malaysia): Providing management software for over 2,000 education centres in Southeast Asia.
    • Dr Elaine Chan – Co-founder and CEO, Vidanex (Malaysia): Using AI and digital pathology to improve cancer diagnostics. [Available for interview]
    • Ella Trinh – Co-founder and COO, Vulcan Augmetics (Vietnam): Developing affordable prosthetics and wearable tech for amputees in emerging markets and conflict zones.
    • Fam Alonto – Founding Partner, Embiggen Group (Philippines): Driving digital transformation and inclusive growth in Southeast Asia. [Available for interview]
    • Nelson Shih – Co-founder and COO, Oakra (Thailand): Enabling Southeast Asian manufacturers to scale eCommerce through logistics and analytics.
    • Nik Muhammad Amin – Founder and CEO, Moovby (Malaysia): A peer-to-peer car-sharing platform transforming urban mobility. [Available for interview]
    • Tan Sukhonpanich – Chief Product Officer, FutureSkill (Thailand): Advancing tech-driven workforce learning and upskilling.
    • Thang Pham – Founder and CEO, Mamibabi (Vietnam): AI-powered parenting app for pregnancy and childcare support.
    • Dr Yen Nguyen – Chief Business Officer, Quickom (Vietnam): Working at the intersection of education, innovation and social impact. [Available for interview]
    About the Asia New Zealand Foundation Te Whītau Tūhono
    Established in 1994, the Asia New Zealand Foundation Te Whītau Tūhono is New Zealand’s leading provider of Asia insights and experiences. Its mission is to equip New Zealanders to excel in Asia, by providing research, insights and targeted opportunities to grow their knowledge, connections and experiences across the Asia region. The Foundation’s activities cover more than 20 countries in Asia and are delivered through eight core programmes: arts, business, entrepreneurship, leadership, media, research, Track II diplomacy and sports. 

    MIL OSI New Zealand News

  • MIL-OSI: 3D Systems Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    ROCK HILL, S.C., May 12, 2025 (GLOBE NEWSWIRE) — 3D Systems Corporation (NYSE:DDD) announced today its financial results for the first quarter ended March 31, 2025.

    • Revenue of $95 million as growth in new hardware systems and related services was offset by a decline in materials sales driven primarily by inventory management in the dental aligner market.
    • Previously announced $50 million cost savings initiative proceeding on schedule for completion by mid-2026. Reduction in operating expenses in Q1 continues to reflect the Company’s focus on cost and efficiency.
    • Company announcing an additional cost reduction initiative estimated to deliver $20 million incremental savings in 2025 to accelerate organizational alignment in response to potential macroeconomic and tariff risks.
    • Company withdrawing full year guidance due to risk of protracted weakness in customer capex spending. Top priority on delivering profitability at current scale. Strong new product portfolio spanning all metal and polymer platforms positions company well for accelerated growth and profitability when customer capex rebounds.
    • Balance sheet significantly strengthened as April sale of Geomagic portfolio provided over $100 million post-tax increase to Company cash reserves, which totaled approximately $250 million as of April 30, 2025.
    Unaudited Three Months Ended
    (in millions, except per share data) March 31, 2025   March 31, 2024
    Revenue $ 94.5     $ 102.9  
    Gross profit $ 32.7     $ 40.9  
    Gross profit margin   34.6 %     39.8 %
    Operating expense $ 69.5     $ 80.8  
    Operating loss $ (36.8 )   $ (39.9 )
    Net loss attributable to 3D Systems Corporation $ (37.0 )   $ (16.0 )
    Diluted loss per share $ (0.28 )   $ (0.12 )
           
    Non-GAAP measures for year-over-year comparisons    
    Non-GAAP gross profit margin   35.0 %     40.1 %
    Non-GAAP operating expense $ 61.6     $ 66.3  
    Adjusted EBITDA $ (23.9 )   $ (20.1 )
    Non-GAAP diluted loss per share $ (0.21 )   $ (0.17 )
                   

    Summary Comments on Results

    Dr. Jeffrey Graves, president and CEO of 3D Systems said, “Our first quarter revenues reflect a continuation of challenging top-line pressures as many customers are delaying their capital investments in order to get greater clarity around potential tariff impacts on their manufacturing and distribution strategies. This is in addition to the ongoing geopolitical and broader macroeconomic uncertainty that we have been experiencing for some time. We believe that these factors led to a noticeable dampening of our customers’ near-term capital spending, particularly in consumer-facing and service bureau related end markets. While we were pleased to see this growth in new printer sales for the second straight quarter, the rate was clearly impacted by these capital spending delays. Encouragingly, this growth in printer sales was driven predominantly by our newest hardware systems, as our strengthened technology portfolio delivered strategic wins for all three of our metal printing platforms, and steady growth broadly in Aerospace and Defense markets. These wins bode well for the future, particularly in the high-reliability Healthcare and Industrial markets, which include Aerospace and Defense, and AI infrastructure, areas that have been an increasing focus for us for some time. These trends were true not only in our US markets, but also in Europe, Asia and the Middle East. With regard to materials sales, the decline we experienced was primarily related to short-term inventory management in the dental orthodontics market. More broadly within our Healthcare segment, we delivered impressive results in spite of the broader economy, with 17% growth in our Personalized Healthcare business, and 18% in our manufacturing operations for FDA-approved parts – both crucial elements of our growth strategy moving forward.”

    Dr. Graves continued, “While margins remained under pressure given lower volumes and less favorable mix, we are focused intently on the items within our direct control. In this respect, our cost reduction plans that we announced last quarter are gaining momentum and contributed approximately $5 million of year-over-year improvement in operating expenses in Q1. While this is the progress we had anticipated, as we continue to assess the unpredictability of the current demand environment, we are taking a more conservative view with respect to revenue expectations for the remainder of 2025 and have announced additional, incremental actions to drive profitability improvements. These latest actions will ensure that our organizational capacity is aligned to our current demand environment. These new actions will be taken in the short term and are designed to deliver $20 million of in-year savings for 2025. Our deliberate preservation of R&D investments over the last few years has yielded a significant wave of new technology introduction across the entirety of our product portfolio, including both our polymer and metal platforms. While the short-term impact on profitability from these investments has been painful, based upon the strong customer interest we have received in these new products, we believe the strength of our offerings and the groundwork we have laid through our application specialists, will be a key competitive differentiator in the market as the headwinds on customer capex spending recede and new production inroads are expanded upon. This is particularly true in metal applications, where our new systems are increasingly preferred for high-quality/high-reliability component manufacturing, for applications within the human body, and in advanced industrial systems. With many of these new products now entering the critical phase of commercialization, our focus can expand to cost reduction activities, including significant footprint consolidations, simplification and modernization of our back-office activities, and a reorganization of our workforce to better align it with current market conditions. Given the scale of our company, we believe these actions can deliver profitability and the positive cash performance needed to sustain our development efforts and serve our customers’ production needs as they expand around the world. In addition, with the closing of our Geomagic asset sale in early April, we have strengthened our balance sheet by adding over $100 million of net proceeds, ending the most recent month with approximately $250 million of cash.”

    Dr. Graves concluded, “So, in short, we have followed a very deliberate strategy for the last three years of investing to be a technology leader in both metals and polymers, and one that has full control over all design, production and sourcing operations that are essential to the quality of our products, as the market for new production applications of 3D printing now opens in earnest. While the short term headwinds driven by tariff risks and other factors are painful and require us to implement significant cost savings initiatives, in the longer-term the new opportunities for localized manufacturing within the US, Europe, India and other nations is a significant driver for long-term value creation for all of our stakeholders.”

    First Quarter 2025 Results

    Revenue for the first quarter of 2025 decreased 8% to $94.5 million compared to the same period last year. The revenue decrease primarily reflects lower materials sales, partially offset by growth in services and hardware systems.

    Healthcare Solutions revenue decreased 9% to $41.3 million compared to the prior year period.

    Industrial Solutions revenue decreased 7% to $53.2 million compared to the prior year period.

    Gross profit margin for the first quarter of 2025 was 34.6% compared to 39.8% in the same period last year. Non-GAAP gross profit margin was 35.0% compared to 40.1% in the same period last year and decreased primarily due to lower volumes and unfavorable price and mix.

    Net loss attributable to 3D Systems Corporation increased by $21.0 million to a loss of $37.0 million in the first quarter of 2025 compared to the same period in the prior year.

    Adjusted EBITDA decreased by $3.8 million to a loss of $23.9 million in the first quarter of 2025 compared to the same period last year primarily driven by lower volumes and unfavorable price and mix, partially offset by an improvement in operating expenses as result of previously announced cost reduction actions.

    2025 Outlook

    Due to the risk of protracted weakness in customer capital investment spending, the Company is withdrawing full year guidance for 2025 as it continues to focus on delivering profitability at its current scale. The Company believes with its strong new product portfolio, spanning all metal and polymer platforms, it is well-positioned for accelerated growth and profitability when customer spending on capex rebounds.

    Financial Liquidity

    At March 31, 2025, cash and cash equivalents totaled $135.0 million and decreased $36.3 million since December 31, 2024. This decrease resulted primarily from cash used in operations of $33.8 million and capital expenditures of $2.8 million. At March 31, 2025, the company had total debt, net of deferred financing costs of $212.3 million.

    Q1 2025 Conference Call and Webcast

    The company will host a conference call and simultaneous webcast to discuss these results on May 13, 2025, which may be accessed as follows:

    Date: Tuesday, May 13, 2025
    Time: 8:30 a.m. Eastern Time
    Listen via webcast: www.3dsystems.com/investor
    Participate via telephone: 201-689-8345

    A replay of the webcast will be available approximately two hours after the live presentation at www.3dsystems.com/investor.

    Forward-Looking Statements

    Certain statements made in this release that are not statements of historical or current facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the company to be materially different from historical results or from any future results or projections expressed or implied by such forward-looking statements. In many cases, forward looking statements can be identified by terms such as “believes,” “belief,” “expects,” “may,” “will,” “estimates,” “intends,” “anticipates” or “plans” or the negative of these terms or other comparable terminology. Forward-looking statements are based upon management’s beliefs, assumptions and current expectations and may include comments as to the company’s beliefs and expectations as to future events and trends affecting its business and are necessarily subject to uncertainties, many of which are outside the control of the company. The factors described under the headings “Forward-Looking Statements” and “Risk Factors” in the company’s periodic filings with the Securities and Exchange Commission, as well as other factors, could cause actual results to differ materially from those reflected or predicted in forward-looking statements. Although management believes that the expectations reflected in the forward-looking statements are reasonable, forward-looking statements are not, and should not be relied upon as a guarantee of future performance or results, nor will they necessarily prove to be accurate indications of the times at which such performance or results will be achieved. The forward-looking statements included are made only as the date of the statement. 3D Systems undertakes no obligation to update or revise any forward-looking statements made by management or on its behalf, whether as a result of future developments, subsequent events or circumstances or otherwise, except as required by law.

    About 3D Systems

    More than 35 years ago, Chuck Hull’s curiosity and desire to improve the way products were designed and manufactured gave birth to 3D printing, 3D Systems, and the additive manufacturing industry. Since then, that same spark continues to ignite the 3D Systems team as we work side-by-side with our customers to change the way industries innovate. As a full-service solutions partner, we deliver industry-leading 3D printing technologies, materials and software to high-value markets such as medical and dental; aerospace, space and defense; transportation and motorsports; AI infrastructure; and durable goods. Each application-specific solution is powered by the expertise and passion of our employees who endeavor to achieve our shared goal of Transforming Manufacturing for a Better Future. More information on the company is available at www.3dsystems.com.

     
    3D SYSTEMS CORPORATION
    Condensed Consolidated Balance Sheets
    (Unaudited)
     
    (in thousands, except par value) March 31, 2025   December 31, 2024
    ASSETS      
    Current assets:      
    Cash and cash equivalents $ 135,040     $ 171,324  
    Accounts receivable, net of reserves — $2,621 and $2,433   104,691       101,471  
    Inventories   120,045       118,530  
    Prepaid expenses and other current assets   39,172       34,329  
    Assets held for sale   2,936       3,176  
    Total current assets   401,884       428,830  
    Property and equipment, net   50,918       51,044  
    Intangible assets, net   17,874       18,020  
    Goodwill   15,102       14,879  
    Operating lease right-of-use assets   51,983       50,715  
    Finance lease right-of-use assets   8,504       8,726  
    Long-term deferred income tax assets   2,107       2,063  
    Other assets   34,983       34,569  
    Total assets $ 583,355     $ 608,846  
    LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST AND EQUITY      
    Current liabilities:      
    Current operating lease liabilities $ 11,775     $ 9,514  
    Accounts payable   39,767       41,833  
    Accrued and other liabilities   44,310       45,488  
    Customer deposits   5,750       4,712  
    Deferred revenue   32,110       27,298  
    Liabilities held for sale   10,305       10,251  
    Total current liabilities   144,017       139,096  
    Long-term debt, net of deferred financing costs   212,310       211,995  
    Long-term operating lease liabilities   51,525       52,527  
    Long-term deferred income tax liabilities   2,001       2,076  
    Other liabilities   25,829       25,001  
    Total liabilities   435,682       430,695  
    Commitments and contingencies      
    Redeemable non-controlling interest   2,034       1,958  
    Stockholders’ equity:      
    Common stock, $0.001 par value, authorized 220,000 shares; shares issued 135,361 and 135,510 as of March 31, 2025 and December 31, 2024, respectively   135       136  
    Additional paid-in capital   1,596,747       1,593,366  
    Accumulated deficit   (1,399,229 )     (1,362,243 )
    Accumulated other comprehensive loss   (52,014 )     (55,066 )
    Total stockholders’ equity   145,639       176,193  
    Total liabilities, redeemable non-controlling interest and stockholders’ equity $ 583,355     $ 608,846  
                   
    3D SYSTEMS CORPORATION
    Condensed Consolidated Statements of Operations
    (Unaudited)
     
      Three Months Ended
    (in thousands, except per share amounts) March 31, 2025   March 31, 2024
    Revenue:      
    Products $ 54,723     $ 64,051  
    Services   39,817       38,854  
    Total revenue   94,540       102,905  
    Cost of sales:      
    Products   37,365       39,587  
    Services   24,486       22,396  
    Total cost of sales   61,851       61,983  
    Gross profit   32,689       40,922  
    Operating expenses:      
    Selling, general and administrative   49,769       57,304  
    Research and development   19,683       23,480  
    Asset impairment charges          
    Total operating expenses   69,452       80,784  
    Loss from operations   (36,763 )     (39,862 )
    Non-operating income (loss):      
    Foreign exchange gain, net   1,139       1,909  
    Interest income   953       2,798  
    Interest expense   (581 )     (714 )
    Other (loss) income, net   (160 )     21,386  
    Total non-operating income   1,351       25,379  
    Loss before income taxes   (35,412 )     (14,483 )
    Provision for income taxes   (671 )     (1,371 )
    Loss on equity method investment, net of income taxes   (903 )     (247 )
    Net loss before redeemable non-controlling interest   (36,986 )     (16,101 )
    Less: net loss attributable to redeemable non-controlling interest         (100 )
    Net loss attributable to 3D Systems Corporation $ (36,986 )   $ (16,001 )
           
    Net loss per common share:      
    Basic $ (0.28 )   $ (0.12 )
    Diluted $ (0.28 )   $ (0.12 )
           
    Weighted average shares outstanding:      
    Basic   132,462       130,820  
    Diluted   132,462       130,820  
                   

    3D SYSTEMS CORPORATION
    Condensed Consolidated Statements of Cash Flows
    (Unaudited)

      Three Months Ended
    (in thousands) March 31, 2025   March 31, 2024
    OPERATING ACTIVITIES      
    Net loss before redeemable non-controlling interest $ (36,986 )   $ (16,101 )
    Adjustments to reconcile net loss to net cash used in operating activities:      
    Depreciation and amortization   5,712       7,272  
    Accretion of debt discount   316       434  
    Stock-based compensation   4,168       8,252  
    Non-cash operating lease expense   2,371       2,728  
    Provision for inventory obsolescence   1,311       4,259  
    Provision for bad debts   325       (71 )
    Loss on the disposition of businesses, property, equipment and other assets   128       155  
    Gain on debt extinguishment         (21,518 )
    Provision for deferred income taxes and reserve adjustments   1,652       714  
    Loss on equity method investment, net of taxes   903       247  
    Changes in operating accounts:      
    Accounts receivable   (1,231 )     (2,391 )
    Inventories   (1,870 )     30  
    Prepaid expenses and other current assets   (4,078 )     (3,277 )
    Accounts payable   (2,799 )     (8,708 )
    Deferred revenue and customer deposits   5,745       7,854  
    Accrued and other liabilities   (4,144 )     (1,017 )
    All other operating activities   (5,309 )     (4,407 )
    Net cash used in operating activities   (33,786 )     (25,545 )
    INVESTING ACTIVITIES      
    Purchases of property and equipment   (2,795 )     (3,190 )
    Proceeds from sale of assets and businesses, net of cash sold         3  
    Acquisitions and other investments, net of cash acquired   (550 )      
    Other investing activities   (67 )      
    Net cash used in investing activities   (3,412 )     (3,187 )
    FINANCING ACTIVITIES      
    Repayment of borrowings/long-term debt         (87,150 )
    Taxes paid related to net-share settlement of equity awards   (285 )     (1,710 )
    Other financing activities   (364 )     (327 )
    Net cash used in financing activities   (649 )     (89,187 )
    Effect of exchange rate changes on cash, cash equivalents and restricted cash   1,178       (1,579 )
    Net decrease in cash, cash equivalents and restricted cash   (36,669 )     (119,498 )
    Cash, cash equivalents and restricted cash at the beginning of the year   172,883       333,111  
    Cash, cash equivalents and restricted cash at the end of the period $ 136,214     $ 213,613  
                   
    3D SYSTEMS CORPORATION
    Segment Information
    (Unaudited)
     
      Three Months Ended
    (in millions) March 31, 2025   March 31, 2024
    Revenue:      
    Healthcare Solutions $ 41.3     $ 45.4  
    Industrial Solutions $ 53.2     $ 57.5  
    Total $ 94.5     $ 102.9  
                   
    3D SYSTEMS CORPORATION
    Reconciliations of GAAP to Non-GAAP Measures
     

    Presentation of Information in this Press Release

    3D Systems reports its financial results in accordance with GAAP. Management also reviews and reports certain non-GAAP measures, including: non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP diluted income (loss) per share, non-GAAP Operating expense and Adjusted EBITDA. These non-GAAP measures exclude certain items that management does not view as part of 3D Systems’ core results as they may be highly variable, may be unusual or infrequent, are difficult to predict and can distort underlying business trends and results. Management believes that the non-GAAP measures provide useful additional insight into underlying business trends and results and provide meaningful information regarding the comparison of period-over-period results. Additionally, management uses the non-GAAP measures for planning, forecasting and evaluating business and financial performance, including allocating resources and evaluating results relative to employee compensation targets. 3D Systems’ non-GAAP measures are not calculated in accordance with or as required by GAAP and may not be calculated in the same manner as similarly titled measures used by other companies. These non-GAAP measures should thus be considered as supplemental in nature and not considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP.

    To calculate the non-GAAP measures, 3D Systems excludes the impact of the following items:

    • amortization of intangible assets, a non-cash expense, as 3D Systems’ intangible assets were primarily acquired in connection with business combinations;
    • costs incurred in connection with acquisitions and divestitures, such as legal, consulting and advisory fees;
    • stock-based compensation expenses, a non-cash expense;
    • charges related to restructuring and cost optimization plans, impairment charges, including goodwill, and divestiture gains or losses;
    • certain compensation expense related to the 2021 Volumetric acquisition; and
    • costs, including legal fees, related to significant or unusual litigation matters.

    Amortization of intangibles and acquisition and divestiture-related costs are excluded from non-GAAP measures as the timing and magnitude of business combination transactions are not predictable, can vary significantly from period to period and the purchase price allocated to amortizable intangible assets and the related amortization period are unique to each acquisition. Amortization of intangible assets will recur in future periods until such intangible assets have been fully amortized. While intangible assets contribute to the company’s revenue generation, the amortization of intangible assets does not directly relate to the sale of the company’s products or services. Additionally, intangible assets amortization expense typically fluctuates based on the size and timing of the company’s acquisition activity. Accordingly, the company believes excluding the amortization of intangible assets enhances the company’s and investors’ ability to compare the company’s past financial performance with its current performance and to analyze underlying business performance and trends. Although stock-based compensation is a key incentive offered to certain of our employees, the expense is non-cash in nature, and we continue to evaluate our business performance excluding stock-based compensation; therefore, it is excluded from non-GAAP measures. Stock-based compensation expenses will recur in future periods. Charges related to restructuring and cost optimization plans, impairment charges, including goodwill, divestiture gains or losses, and the costs, including legal fees, related to significant or unusual litigation matters are excluded from non-GAAP measures as the frequency and magnitude of these activities may vary widely from period to period. Additionally, impairment charges, including goodwill, are non-cash. Furthermore, the company believes the costs, including legal fees, related to significant or unusual litigation matters are not indicative of our core business’ operations. Finally, 3D Systems excludes contingent consideration recorded as compensation expense related to the 2021 Volumetric acquisition from non-GAAP measures as management evaluates financial performance excluding this expense, which is viewed by management as similar to acquisition consideration.

    The matters discussed above are tax effected, as applicable, in calculating non-GAAP diluted income (loss) per share.

    Adjusted EBITDA, defined as net income, plus income tax (provision) benefit, interest and other income (expense), net, stock-based compensation expense, amortization of intangible assets, depreciation expense, and other non-GAAP adjustments, all as described above, is used by management to evaluate performance and helps measure financial performance period-over-period.

    A reconciliation of GAAP to non-GAAP financial measures is provided in the accompanying schedules.

    Certain columns may not add due to the use of rounded numbers. Percentages presented are calculated from the underlying numbers in thousands.

    3D Systems does not provide forward-looking guidance for certain measures on a GAAP basis. The company is unable to provide a quantitative reconciliation of forward-looking non-GAAP gross profit margin, Adjusted EBITDA, and non-GAAP operating expense to the most directly comparable forward-looking GAAP measures without unreasonable effort because certain items, including litigation costs, acquisition expenses, stock-based compensation expense, intangible assets amortization expense, restructuring expenses, and goodwill impairment charges are difficult to predict and estimate. These items are inherently uncertain and depend on various factors, many of which are beyond the company’s control, and as such, any associated estimate and its impact on GAAP performance could vary materially.

    Non-GAAP Gross Profit and Gross Profit Margin (unaudited)

      Three Months Ended
    (in millions) March 31, 2025   March 31, 2024
      Gross Profit   Gross Profit Margin (1)   Gross Profit   Gross Profit Margin (1)
    Gross profit (GAAP) $ 32.7       34.6 %   $ 40.9       39.8 %
    Amortization expense   0.2       0.2 %     0.3       0.3 %
    Restructuring expense   0.2       0.2 %           %
    Gross profit (Non-GAAP) $ 33.1       35.0 %   $ 41.2       40.1 %
                                   

    (1) Calculated as non-GAAP gross profit as a percentage of total revenue.

    Non-GAAP Operating Expense (unaudited)

      Three Months Ended
    (in millions) March 31, 2025   March 31, 2024
    Operating expense (GAAP) $ 69.5     $ 80.8  
    Amortization expense   (0.8 )     (2.0 )
    Stock-based compensation expense   (4.2 )     (8.2 )
    Acquisition and divestiture-related expense   (0.9 )     (0.1 )
    Legal and other expense   (1.1 )     (4.2 )
    Restructuring expense   (0.8 )      
    Non-GAAP operating expense $ 61.6     $ 66.3  
                   

    Net Loss Attributable to 3D Systems Corporation to Adjusted EBITDA (unaudited)

      Three Months Ended
    (in millions) March 31, 2025   March 31, 2024
    Net loss attributable to 3D Systems Corporation (GAAP) $ (37.0 )   $ (16.0 )
    Interest income, net   (0.4 )     (2.1 )
    Provision for income taxes   0.7       1.4  
    Depreciation expense   4.7       5.0  
    Amortization expense   1.0       2.3  
    EBITDA (Non-GAAP)   (31.0 )     (9.4 )
    Stock-based compensation expense   4.2       8.2  
    Acquisition and divestiture-related expense   0.9       0.1  
    Legal and other expense   1.1       4.2  
    Restructuring expense   1.0        
    Net loss attributable to redeemable non-controlling interest         (0.1 )
    Loss on equity method investment, net of tax   0.9       0.2  
    Gain on repurchase of debt         (21.5 )
    Other non-operating income   (1.0 )     (1.8 )
    Adjusted EBITDA (Non-GAAP) $ (23.9 )   $ (20.1 )
                   

    Diluted Loss per Share (unaudited)

      Three Months Ended
    (in dollars) March 31, 2025   March 31, 2024
    Diluted loss per share (GAAP) $ (0.28 )   $ (0.12 )
    Amortization expense   0.01       0.02  
    Stock-based compensation expense   0.03       0.06  
    Acquisition and divestiture-related expense   0.01        
    Legal and other expense   0.01       0.03  
    Restructuring expense   0.01        
    Gain on repurchase of debt         (0.16 )
    Loss on equity method investment and other   0.01        
    Non-GAAP diluted loss per share $ (0.21 )   $ (0.17 )
                   

    The MIL Network

  • MIL-OSI: Altus Group Announces Q2 2025 Dividend Payment

    Source: GlobeNewswire (MIL-OSI)

    TORONTO, May 12, 2025 (GLOBE NEWSWIRE) — Altus Group Limited (ʺAltus Group” or “the Company”) (TSX: AIF), a leading provider of commercial real estate (“CRE”) intelligence, announced today that its Board of Directors approved the payment of a cash dividend of $0.15 per common share for the second quarter ending June 30, 2025. Payment will be made on July 15, 2025 to common shareholders of record as at June 30, 2025.

    Altus Group’s Dividend Reinvestment Plan (“DRIP”) permits eligible shareholders to direct their cash dividends to be reinvested in additional common shares of the Company. For shareholders who wish to reinvest their dividends under the DRIP, Altus Group intends to issue common shares from treasury at a price equal to 96% of the weighted average closing price of the shares for the five trading days preceding the dividend payment date. Full details of the DRIP program are available on the Company’s website.

    Altus Group confirms that all dividends paid or deemed to be paid to its common shareholders qualify as ʺeligible dividendsʺ for purposes of subsection 89(14) of the Income Tax Act (Canada) and similar provincial and territorial legislation, unless indicated otherwise.

    About Altus Group

    Altus connects data, analytics, and expertise to deliver the intelligence necessary to drive optimal CRE performance.  The industry’s top leaders rely on our market-leading solutions and expertise to power performance and mitigate risk. Our global team of ~ 2,000 experts are making a lasting impact on an industry undergoing unprecedented change – helping shape the cities where we live, work, and build thriving communities. For more information about Altus (TSX: AIF) please visit www.altusgroup.com.

    FOR FURTHER INFORMATION PLEASE CONTACT:

    Martin Miasko
    Sr. Director, Investor Relations and Strategy, Altus Group
    (416) 204-5136
    martin.miasko@altusgroup.com

    The MIL Network

  • MIL-OSI: Oxbridge Re Highlights Growth in Tokenized Reinsurance, Strategic Partnerships, and Reports Q1 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    GRAND CAYMAN, Cayman Islands, May 12, 2025 (GLOBE NEWSWIRE) — Oxbridge Re Holdings Limited (NASDAQ: OXBR), (the “Company”), which together with its subsidiary SurancePlus is engaged in the business of tokenized Real-World Assets (“RWAs”), initially in the form of tokenized reinsurance securities, and reinsurance business solutions to property and casualty casualty – bridging the gap between the SEC, blockchain, and tokenization. The company today, reported its results for the three months ended March 31, 2025.

    “As the first Nasdaq-listed company to issue a tokenized security in reinsurance, Oxbridge Re, through SurancePlus, is transforming access to this asset class,” said Jay Madhu, Chairman and CEO of Oxbridge Re. “We are proud of our progress and remain focused on expanding SurancePlus, democratizing access to reinsurance with a commitment to transparency and compliance.”

    The Company recently signed a Memorandum of Understanding (MOU) with Plume, a blockchain platform managing over $4.5 billion in assets and serving 18 million unique addresses. This partnership represents a significant opportunity to enhance distribution, while Oxbridge Re continues to explore additional partnerships to further broaden its reach.

    SurancePlus is also highlighting its previously launched 2025–2026 tokenized reinsurance offerings, which provide a diverse range of investment opportunities. These offerings include a balanced-yield product targeting a 20% annual return, designed for investors seeking stable, attractive yields with moderate risk, and a high-yield option targeting a 42% annual return. These options broaden the investor base, offering both risk-averse and high-return-seeking investors a compliant, blockchain-powered pathway to participate in the reinsurance sector.

    The company actively participated in major global tokenization and blockchain events, including Consensus 2024 in Austin, Texas, Token2049 in Singapore, and Token2049 in Dubai. These forums provided an opportunity to showcase SurancePlus, strengthen industry relationships, and explore collaborative opportunities with leading blockchain platforms.

    “Supported by a strong balance sheet and a disciplined approach, we are well-positioned to capitalize on emerging opportunities in the RWA sector,” added Madhu. “Looking ahead, we remain committed to scaling SurancePlus with integrity, innovation, and a focus on long-term value creation.” 

    Financial Performance

    Net premiums earned for the quarter ended March 31, 2025 increased to $595,000 from $549,000 for the quarter ended March 31, 2024. The increase is due to the rates on contracts that were in force in the quarter ended March 31, 2025 when compared to the contracts in force in the prior period.

    For the three months ended March 31, 2025, the Company generated net loss of $139,000 or ($0.02) per basic and diluted loss per share compared to net loss of $905,000 or ($0.15) per basic and diluted earnings per share, for the quarter ended March 31, 2024. The decrease in net loss is primarily due to the positive change in the fair value of equity securities and sale of investments in Jet.AI during the quarter ended March 31, 2025 when compared with the prior period.

    For the three months ended March 31, 2025, total expenses, including policy acquisition costs and general and administrative expenses, increased to $570,000 from $548,000 for the quarter ended March 31, 2024. The increase is primarily due to the value stock-based compensation incurred during the three-month period ending March 31, 2025 as a result of higher share price on grant date.

    As of March 31, 2025, our restricted cash, and cash equivalents increased by $3.7 million, or 62.85%, to $9.6 million, from $5.9 million as of December 31, 2024. The increase is primarily due to premium deposits made during the three months ending March 31, 2025 as well the completion of a registered direct offering that generated $2.7 million net of expenses.

    Financial Ratios

    Loss Ratio. The loss ratio is the ratio of losses and loss adjustment expenses incurred to premiums earned and measures the underwriting profitability of our reinsurance business. The loss ratio remained consistent at 0% for the quarter end March 31, 2025 compared with the quarter ended March 31, 2024.

    Acquisition Cost Ratio. The acquisition cost ratio is the ratio of policy acquisition costs and other underwriting expenses to net premiums earned. The acquisition cost ratio measures our operational efficiency in producing, underwriting and administering our reinsurance business.

    The acquisition cost ratio remained consistent at 10.9% for the quarter end March 31, 2025 compared with the quarter ended March 31, 2024.

    Expense Ratio. The expense ratio is the ratio of policy acquisition costs and general and administrative expenses to net premiums earned. We use the expense ratio to measure our operating performance. The expense ratio decreased marginally from 99.8% for the three-month period ended March 31, 2024 to 95.8% for the three-month period ended March 31, 2025. The decrease is due to higher net premiums earned during the three-month period ended March 31, 2025, when compared with the prior period.

    Combined ratio. We use the combined ratio to measure our underwriting performance. The combined ratio is the sum of the loss ratio and the expense ratio. The combined ratio decreased marginally from 99.8% for the three-month period ended March 31, 2024 to 95.8% for the three-month period ended March 31, 2025. The decrease is due to higher net premiums earned during the three-month period ended March 31, 2025, when compared with the prior period.

    Conference Call

    Management will host a conference call later today to discuss these financial results, followed by a question and answer session. The Company’s President and Chief Executive Officer Jay Madhu and Chief Financial Officer Wrendon Timothy will host the call starting at 4:30 p.m. Eastern time. The live presentation can be accessed by dialing the number below.

    Date: May 12, 2025
    Time: 4.30 p.m. Eastern time
    Toll-free number: 877-524-8416
    International number: +1 412-902-1028

    Please call the conference telephone number 15 minutes before the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact InComm Conferencing at +1-201-493-6280 or media@incommconferencing.com

    A replay of the call will be available by telephone after 4:30 p.m. Eastern time on the same day of the call until May 26, 2025.

    Toll-free replay number: 877-660-6853
    International replay number: +1-201-612-7415
    Conference ID: 13753764

    About Oxbridge Re Holdings Limited

    Oxbridge Re Holdings Limited (NASDAQ: OXBR, OXBRW) (“Oxbridge Re”) is headquartered in the Cayman Islands. The company offers tokenized Real-World Assets (“RWAs”) as tokenized reinsurance securities and reinsurance business solutions to property and casualty insurers, through its wholly owned subsidiaries Oxbridge Reinsurance Limited, Oxbridge Re NS, and SurancePlus Inc.

    Insurance businesses in the Gulf Coast region of the United States purchase property and casualty reinsurance through our licensed reinsurers Oxbridge Reinsurance Limited and Oxbridge Re NS.

    Our new Web3-focused subsidiary, SurancePlus Inc. (“SurancePlus”), has developed the first “on-chain” reinsurance RWA of its kind to be sponsored by a subsidiary of a publicly traded company. By digitizing interests in reinsurance contracts as on-chain RWAs, SurancePlus has democratized the availability of reinsurance as an alternative investment to both U.S. and non-U.S. investors.

    Forward-Looking Statements

    This press release may contain forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “estimate,” “expect,” “intend,” “plan,” “project” and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various risks and uncertainties. A detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section entitled “Risk Factors” contained in our Form 10-K filed with the Securities and Exchange Commission (“SEC”) on 26th March 2025. The occurrence of any of these risks and uncertainties could have a material adverse effect on the Company’s business, financial condition and results of operations. Any forward-looking statements made in this press release speak only as of the date of this press release and, except as required by law, the Company undertakes no obligation to update any forward-looking statement contained in this press release, even if the Company’s expectations or any related events, conditions or circumstances change.

    Company Contact:

    Oxbridge Re Holdings Limited
    Jay Madhu, CEO
    345-749-7570
    jmadhu@oxbridgere.com

    OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES
    Consolidated Balance Sheets
    (expressed in thousands of U.S. Dollars, except per share and share amounts)

        At March 31, 2025     At December 31, 2024  
                 
    Assets                
    Equity securities, at fair value (cost: $1,532 and $1,532)   $ 116       113  
    Cash and cash equivalents     4,963       2,135  
    Restricted cash and cash equivalents     4,634       3,758  
    Premiums receivable     223       1,059  
    Other Investments           48  
    Deferred policy acquisition costs     44       109  
    Operating lease right-of-use assets     122       148  
    Prepayment and other assets     160       94  
    Property and equipment, net     1       1  
    Total assets   $ 10,263       7,465  
                     
    Liabilities and Shareholders’ Equity                
    Liabilities:                
    Notes payable to noteholders     118       118  
    Unearned Premium Reserve     397       991  
    Operating lease liabilities     122       148  
    Accounts payable and other liabilities     432       366  
    Total liabilities     1,069       1,623  
                     
    Mezzanine Equity                
    Due to EpsilonCat Re / DeltaCat Re Tokenholders     1,979       1,732  
                     
    Shareholders’ equity:                
    Ordinary share capital, (par value $0.001, 50,000,000 shares authorized; 7,442,922 and 6,379,002 shares issued and outstanding)     6       6  
    Additional paid-in capital     37,335       34,105  
    Accumulated Deficit     (30,302 )     (30,163 )
    Total Oxbridge shareholders’ equity     7,039       3,948  
    Non-controlling interests     176       162  
    Total shareholders’ equity     7,215       4,110  
    Total liabilities and shareholders’ equity   $ 10,263       7,465  


    OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARIES

    Consolidated Statements of Operations
    (Unaudited)
    (expressed in thousands of U.S. Dollars, except per share amounts)

        Three Months Ended March 31,  
        2025     2024  
                 
    Revenue                
    Net premiums earned     595       549  
    Net investment and other income     79       63  
    Net realized investment gain            
    Interest and gain on redemption of loan receivable           41  
    Unrealized gain on other investments     (20 )     (688 )
    Realized gain on other investments     35        
    Change in fair value of equity securities     3       (90 )
                     
    Total revenue     692       (125 )
                     
    Expenses                
    Policy acquisition costs and underwriting expenses     65       60  
    General and administrative expenses     505       488  
                     
    Total expenses     570       548  
                     
    Income (loss) before income attributable to tokenholders and non-controlling interests     122       (673 )
                     
    Income attributable to tokenholders     (247 )     (232 )
                     
    Loss before income attributable to non-controlling interests     (125 )     (905 )
                     
    Income attributable to non-controlling interests     (14 )      
    Net loss attributable to ordinary shareholders     (139 )     (905 )
                     
    Loss per share attributable to ordinary shareholders                
    Basic and Diluted     (0.02 )     (0.15 )
                     
    Weighted-average shares outstanding                
    Basic and Diluted     6,899,062       6,005,162  
                     
    Performance ratios to net premiums earned:                
    Loss ratio     0.0 %     0.0 %
    Acquisition cost ratio     10.9 %     10.9 %
    Expense ratio     95.8 %     99.8 %
    Combined ratio     95.8 %     99.8 %

    The MIL Network

  • MIL-Evening Report: Range anxiety – or charger drama? Australians are buying hybrid cars because they don’t trust public chargers

    Source: The Conversation (Au and NZ) – By Ganna Pogrebna, Executive Director, AI and Cyber Futures Institute, Charles Sturt University

    VisualArtStudio/Shutterstock

    Range anxiety has long been seen as the main obstacle stopping drivers from going electric.

    But range isn’t the real issue. The average range of a new electric vehicle (EV) is more than 450 kilometres, and top models offer more than 700km per charge. By contrast, the average car is driven about 33km per day in Australia as of 2020.

    What’s really going on is charger anxiety – the question of whether you can find somewhere reliable to recharge when you’re away from home. Australia’s public chargers are not common enough or reliable enough to give motorists certainty they can find a place to recharge.

    This is why many drivers are hedging their bets. Rather than embracing battery-electric vehicles, many Australian drivers are opting for hybrids as well as plug-in hybrids (PHEVs), which couple a smaller battery with an internal combustion engine. Hybrids and PHEVs accounted for almost 20% of new car sales from July–September last year, compared to 6.5% for fully electric vehicles.

    Labor’s reelection could lead to better charging infrastructure. Last term, the federal government set a goal of a fast charging station every 150km along major highways, while state governments are also building more. But so far, these efforts aren’t enough to ensure Australia has reliable chargers in the right locations. Until then, cautious drivers will buy hybrids.

    Australia’s charger network has expanded, but many drivers are anxious about availability and reliability.
    Stepan Skorobogadko/Shutterstock

    Public chargers matter

    EV owners charge their cars at home an estimated 70–85% of the time. They use public chargers just 10–20% of the time and workplace charging 6–10% of the time.

    This makes sense – home charging is reliable and cheap. But these figures also point to a problem: EV drivers don’t trust public chargers.

    At present, Australia has about 3,700 public chargers nationwide. Each charging station typically supports one or two EVs, often offering different charging speeds. By contrast, there are around 6,600 service stations, with the ability to fuel multiple vehicles at once.



    Other countries have much larger charger networks. The United Kingdom has more than 40,000 and Canada 16,000. China, the world leader, has almost 10 million.

    China now has 10 million EV chargers.
    Tang Yan Song/Shutterstock

    Outside major Australian cities, chargers are harder to find and are often broken or in use. Chargers are usually not staffed, meaning there’s no one watching to prevent vandalism or organise maintenance.

    EV plugs are not yet standardised. Some plugs may not be available, and using chargers isn’t always easy. By contrast, petrol cars use standard nozzles, payment is simpler and staff and CCTV presence discourages vandalism and ensures the pumps work.

    If a petrol car runs out of fuel, the problem can be solved with a lift and a jerry can. But if your EV runs flat in a rural area because you can’t find a charger, you may have to get it towed.

    This lack of reliability is more than just a logistical hurdle — it’s a psychological barrier.

    Psychological roadblocks

    A recent study found the fear of running out of charge was a major psychological barrier to buying an EV – particularly for rural and regional Australians, who drive longer distances. As long as chargers remain unreliable or located too far apart, this anxiety will persist.

    In Australia, it’s easy to find reports of broken chargers, long queues at charging stations, gaps in the rural network and personal anecdotes of EV owners struggling to find a way to charge.

    A 2023 survey found almost 70% of EV owners had come across an inoperable charger at least once over the previous six months.

    What can Australia take from overseas experience?

    Australia’s government wants to increase EV uptake. While EVs are getting cheaper, the supporting infrastructure isn’t good enough yet to make them the norm.

    Across the European Union, chargers are being installed every 60km along major highways and efforts are being made to tackle psychological barriers to uptake.

    Federal and state governments in the United States have invested heavily in filling gaps in the charger network and working with consumers to encourage more sustainable commuting.

    Plug-in hybrids are powered by batteries and an internal combustion engine.
    algre/Shutterstock

    Choosing a hybrid is rational but not ideal

    It should be no surprise more Australians are buying hybrids as a safety net, given there are plenty of service stations and not as many EV chargers. City driving can allow near-total use of the electric motor, while longer trips still require petrol.

    The choice is rational. But it’s not ideal from an environmental point of view. Traditional hybrids are still largely powered by an internal combustion engine, while PHEVs can run as electric for longer but still use their combustion engines.

    While plug-ins have lower emissions than traditional vehicles, they often fail to deliver the full emissions savings drivers and regulators might hope for. Many drivers don’t charge regularly and rely instead on petrol.

    Chargers aren’t the only factor, of course. A tax break for PHEVs boosted their popularity for several years before ending in April, while sales of Tesla EVs have fallen off a cliff due to the unpopularity of owner Elon Musk.

    What needs to change?

    The solutions are straightforward: expand the charger network, especially in regional and rural areas. Improve maintenance schedules and ensure existing chargers are reliable. Make sure data on their availability is accessible in real time so drivers can avoid anxiety and frustration. Counter EV misinformation and anecdotal biases with information campaigns.

    When EV ownership and charging in Australia is practical and low risk, the sluggish EV transition will accelerate. But until then, many drivers will keep buying hybrids as a compromise.

    Ganna Pogrebna does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. Range anxiety – or charger drama? Australians are buying hybrid cars because they don’t trust public chargers – https://theconversation.com/range-anxiety-or-charger-drama-australians-are-buying-hybrid-cars-because-they-dont-trust-public-chargers-250281

    MIL OSI AnalysisEveningReport.nz

  • MIL-OSI: Phunware Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    New Customer Launches Drive 40% Revenue Growth for Software Subscriptions and Services

    Strong Balance Sheet of $109.7 Million Powering R&D Activities in AI-Driven Customer Platform and Corporate Initiatives

    AUSTIN, Texas, May 12, 2025 (GLOBE NEWSWIRE) — Phunware, Inc. (“Phunware” or the “Company”) (NASDAQ: PHUN), a leader in enterprise cloud solutions for mobile applications, today reported financial results for the first quarter ended March 31, 2025.

    Financial Highlights

    • Software subscriptions and services revenue increased 40% to $0.6 million in Q1 2025, as compared to Q1 2024.
    • Q1 2025 software and subscription bookings totaled $0.4 million.
    • Net loss was $3.7 million for the three months ended March 31, 2025, as compared to $2.3 million in the previous year period.
      • Primary driver for net loss increase was $1.2 million one-time legal expenses related to the Wild Basin litigation bench trial that concluded in Q1 2025; a decision is expected in Q3 2025.
    • Net loss per share improved to ($0.18) per share in Q1 2025, as compared to ($0.33) per share in Q1 2024.
    • Net cash used in operations decreased to $3.3 million for the three months ended March 31, 2025, compared to $5.5 million for the previous year period.
    • Cash and cash equivalents as of March 31, 2025, was $109.7 million.

    Recent Business Highlights

    • During Q1 2025, added three (3) new customers in the hospitality vertical. Momentum carried into Q2, with a new $0.5 million booking for a multi-location health care facility.
    • Appointed Quyen Du to the Board of Directors, a 25-year corporate strategy and development executive with Fortune 500 consumer brands.
      • Her appointment satisfies Nasdaq Stock Market LLC (“Nasdaq”) continued listing requirements for audit committee service.
    • Attended investor and industry conferences including the 37th Annual ROTH Conference and upcoming 2025 Hospitality Industry Technology Exposition and Conference (HITEC®) June 16–19 in Indianapolis, Indiana.

    Management Commentary

    “The first quarter of 2025 was underscored by new customers and bookings and continued focus on our AI-related initiatives,” said interim CEO Stephen Chen. “First quarter revenues of $0.7 million and gross margin of 52% were driven by a 40% increase in Mobile software subscriptions and services with delivered customer projects. With an existing hospitality customer, we launched an integrated conference solution including dynamic wayfinding, mobile engagement messaging, events scheduling, and content management. With a well-known resort and entertainment venue customer, we launched our hospitality industry solution application to enhance guest experiences.”

    “Software bookings for the first quarter were $0.4 million and we continue to accelerate our pipeline while simultaneously shortening the sales cycle. With three new customers in the hospitality vertical during the first quarter, and a $0.5 million multi-location health care facility booking in the second quarter, we believe customer momentum continues to accelerate.”

    “We were honored to appoint Quyen Du to our Board of Directors in February. Ms. Du brings 25 years’ experience in strategy and corporate development as an executive at Fortune 500 consumer brands. She has an impressive record of guiding strategic growth and will add tremendous expertise to our Board for Phunware investments, M&A and new business development strategies. We are happy to announce that Ms. Du was elected to three-year term at our most recent stockholders’ meeting.”

    “While we’ve seen some softness in the ad market, we are focused on new opportunities in that market and investing in marketing and research and development in generative and agentic AI initiatives, among others. We remain committed to reinforcing our core business units, identifying high-impact investment and M&A opportunities, driving operational excellence, and aligning our cost structure for long-term scalability. We are also committed to enhancing our team with experienced sales, marketing, and technology professionals to amplify market visibility and accelerate customer acquisition.”

    “Looking ahead, we are developing additional features and functionalities for our existing products, including AI-related features such as AI Personal Concierge for hospitality customers and their guests and Intelligent Reporting for large real property owners. We expect to launch the initial AI Personal Concierge product in mid-2025. With our leadership position in mobile app development, combined with compelling new technology improvements and AI integration, we are executing on our strategic vision to deliver our solutions globally. I look forward to additional announcements and milestones in the months ahead,” concluded Chen.

    Note about Non-GAAP Financial Measures

    A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States of America, or GAAP. Non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. Other companies may use different non-GAAP measures and presentation of results.

    In addition to financial results presented in accordance with GAAP, this press release presents adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is determined by taking net loss and adding interest expense (income), income tax expense, depreciation, and further adjusted for non-cash impairment, valuation adjustments and stock-based compensation expense. The company believes that this non-GAAP measure, viewed in addition to and not in lieu of net loss, provides additional information to investors by providing a more focused measure of operating results. This metric is an integral part of the Company’s internal reporting to evaluate its operations and the performance of senior management. A reconciliation of adjusted EBITDA to net loss, the most comparable GAAP measure, is available in the accompanying financial tables below. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies.

           
    US-GAAP NET LOSS TO ADJUSTED EBITDA RECONCILIATION
    (Unaudited)
           
        Three Months Ended March 31,  
    (in thousands)   2025     2024  
    Net loss   $ (3,723 )   $ (2,292 )
    Add back: Depreciation     4       4  
    Add back: Interest expense     9       108  
    Less: Interest income     (1,119 )     (140 )
    EBITDA     (4,829 )     (2,320 )
    Add back: Stock-based compensation     86       630  
    Less: Gain on extinguishment of debt           (535 )
    Adjusted EBITDA   $ (4,743 )   $ (2,225 )
                     

    About Phunware

    Phunware, Inc. (NASDAQ: PHUN) is an enterprise software company specializing in mobile app solutions with integrated intelligent capabilities. We provide businesses with the tools to create, implement, and manage custom mobile applications, analytics, digital advertising, and location-based services. Phunware is transforming mobile engagement by delivering scalable, personalized, and data-driven mobile app experiences.

    Phunware’s mission is to achieve unparalleled connectivity and monetization through the widespread adoption of Phunware mobile technologies, leveraging brands, consumers, partners, digital asset holders, and market participants. Phunware is poised to expand its software products and services audience through a new Generative AI platform which is in development, utilize and monetize its patents and other intellectual property, and renewed focus on development of a digital asset ecosystem for existing holders and new market participants.

    For more information on Phunware, please visit www.phunware.com. To better understand and leverage generative AI and Phunware’s mobile app technologies, visit ai.phunware.com.

    Safe Harbor / Forward-Looking Statements

    This press release includes forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations and financial position, business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” and similar expressions are intended to identify forward-looking statements. For example, Phunware is using forward-looking statements when it discusses the adoption and impact of emerging technologies and their use across mobile engagement platforms. The forward-looking statements contained in this press release are based on our current expectations and beliefs concerning future developments and their potential effects on us. These forward-looking statements involve risks, uncertainties, and other assumptions that may cause actual results to differ materially from those expressed or implied. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors” in our filings with the SEC. We undertake no obligation to update any forward-looking statements.

    By their nature, forward-looking statements involve risks and uncertainties. We caution you that forward-looking statements are not guarantees of future performance and that our actual results may differ materially from those expressed or implied by these forward-looking statements.

    Investor Relations Contact:
    Chris Tyson, Executive Vice President
    MZ Group – MZ North America
    949-491-8235
    PHUN@mzgroup.us
    www.mzgroup.us

    Phunware Media Contact:
    Joe McGurk, Managing Director
    917-259-6895
    PHUN@mzgroup.us

               
    Phunware, Inc.
    Consolidated Balance Sheets
    (In thousands, except share and per share data)
               
      March 31,     December 31,  
      2025     2024  
    Assets: (Unaudited)        
    Current assets:          
    Cash and cash equivalents $ 109,719     $ 112,974  
    Accounts receivable, net of allowance for credit losses of $264 and $166 as of March 31, 2025 and December 31, 2024, respectively   697       276  
    Digital currencies   82       103  
    Prepaid expenses and other current assets   588       406  
    Total current assets   111,086       113,759  
    Non-current assets:          
    Property and equipment, net   20       24  
    Right-of-use asset   770       840  
    Other assets   158       158  
    Total non-current assets   948       1,022  
    Total assets $ 112,034     $ 114,781  
               
    Liabilities and stockholders’ equity          
    Current liabilities:          
    Accounts payable $ 4,073     $ 3,754  
    Accrued expenses   492       148  
    Deferred revenue   1,124       1,034  
    Lease liability   320       313  
    PhunCoin subscription payable   1,202       1,202  
    Total current liabilities   7,211       6,451  
    Deferred revenue   660       528  
    Lease liability   537       619  
    Total noncurrent liabilities   1,197       1,147  
    Total liabilities   8,408       7,598  
    Commitments and contingencies (See Note 7)          
    Stockholders’ equity          
    Common stock, $0.0001 par value, 1,000,000,000 shares authorized; 20,180,875 shares issued and 20,170,745 share outstanding as of March 31, 2025 and 20,166,665 shares issued and 20,156,535 shares outstanding as of December 31, 2024   2       2  
    Treasury Stock   (502 )     (502 )
    Additional paid-in capital   421,169       421,003  
    Accumulated deficit   (317,043 )     (313,320 )
    Total stockholders’ equity   103,626       107,183  
    Total liabilities and stockholders’ equity $ 112,034     $ 114,781  
                   
    Phunware, Inc.
    Consolidated Statements of Operations and Comprehensive Loss
    (In thousands, except share and per share information)
         
      Three Months Ended  
      March 31,  
      2025     2024  
               
    Net revenues $ 688     $ 921  
    Cost of revenues   329       397  
    Gross profit   359       524  
    Operating expenses:          
    Sales and marketing   896       443  
    General and administrative   3,464       2,471  
    Research and development   813       484  
    Total operating expenses   5,173       3,398  
    Operating loss   (4,814 )     (2,874 )
    Other income (expense):          
    Interest expense   (9 )     (108 )
    Interest income   1,119       140  
    Gain on extinguishment of debt         535  
    Other (expense) income, net   (19 )     15  
    Total other income   1,091       582  
    Loss before taxes   (3,723 )     (2,292 )
    Income tax expense          
    Net loss   (3,723 )     (2,292 )
    Net loss per share, basic and diluted $ (0.18 )   $ (0.33 )
    Weighted-average shares used to compute net loss per share, basic & diluted   20,169,640       6,864,226  
                   
    Phunware, Inc.
    Consolidated Statements of Cash Flows
    (In thousands)
         
      Three Months Ended  
      March 31,  
      2025     2024  
    Operating activities          
    Net loss $ (3,723 )   $ (2,292 )
    Adjustments to reconcile net loss to net cash used in operating activities:          
    Gain on extinguishment of debt         (535 )
    Stock-based compensation   86       630  
    Other adjustments   132       329  
    Changes in operating assets and liabilities:          
    Accounts receivable   (444 )     (82 )
    Prepaid expenses and other assets   (182 )     (11 )
    Accounts payable and accrued expenses   663       (2,893 )
    Lease liability payments   (89 )     (185 )
    Deferred revenue   222       (286 )
    Net cash used in operating activities from continued operations   (3,335 )     (5,325 )
    Net cash used in operating activities from discontinued operations         (205 )
    Net cash used in operating activities   (3,335 )     (5,530 )
    Investing activities          
    Net cash provided by (used in) investing activities          
    Financing activities          
    Proceeds from sales of common stock, net of issuance costs   80       23,204  
    Net cash provided by financing activities   80       23,204  
               
    Effect of exchange rate on cash         (41 )
    Net (decrease) increase in cash and cash equivalents   (3,255 )     17,633  
    Cash and cash equivalents at the beginning of the period   112,974       3,934  
    Cash and cash equivalents at the end of the period $ 109,719     $ 21,567  
               
               
    Supplemental disclosure of cash flow information          
    Interest paid $ 9     $ 4  
    Income taxes paid $     $ 26  
    Supplemental disclosures of non-cash financing activities:          
    Issuance of common stock upon conversion of the 2022 Promissory Note $     $ 4,505  
    Issuance of common stock for payment of bonuses and consulting fees $     $ 35  
                   

    The MIL Network

  • MIL-OSI: Rapid7 Announces First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    • Annualized recurring revenue (“ARR”) of $837 million, an increase of 4% year-over-year
    • Total revenue of $210 million, up 3% year-over-year; Product subscriptions revenue of $204 million, up 4% year-over-year
    • GAAP operating loss of $0.1 million; Non-GAAP operating income of $32 million
    • Net cash provided by operating activities of $30 million; Free cash flow of $25 million

    BOSTON, May 12, 2025 (GLOBE NEWSWIRE) — Rapid7, Inc. (Nasdaq: RPD), a leader in extended risk and threat detection, today announced its financial results for the first quarter 2025.

    “We had a slower start to 2025 than anticipated however we have a clear strategy and strong conviction in our long-term opportunity,” said Corey Thomas, Chairman and CEO of Rapid7. “Against a more uncertain macroeconomic environment, we are executing with increased focus and urgency—investing behind our leadership in MDR, accelerating Exposure Command adoption, and sharpening our go-to-market engine. We believe these steps position us for improved ARR in the second half of the year and beyond. At the same time, we remain committed to operational discipline and delivering strong free cash flow in 2025.”

    First Quarter 2025 Financial Results and Other Metrics

      As of March 31,
      2025
      2024
      % Change
      (dollars in thousands)
    ARR $ 837,220     $ 807,196     4 %
    Number of customers   11,685       11,462     2 %
    ARR per customer $ 71.6     $ 70.4     2 %
      Three Months Ended March 31,
      2025   2024   % Change
      (in thousands, except per share data)
    Product subscriptions revenue $ 203,935     $ 196,918     4 %
    Professional services revenue   6,318       8,183     (23 %)
    Total revenue $ 210,253     $ 205,101     3 %
               
    North America revenue $ 157,945     $ 157,340     %
    Rest of world revenue   52,308       47,761     10 %
    Total revenue $ 210,253     $ 205,101     3 %
               
    GAAP gross profit $ 150,773     $ 144,107      
    GAAP gross margin   72 %     70 %    
    Non-GAAP gross profit $ 157,460     $ 151,112      
    Non-GAAP gross margin   75 %     74 %    
               
    GAAP (loss) income from operations $ (101 )   $ 9,716      
    GAAP operating margin   %     5 %    
    Non-GAAP income from operations $ 32,353     $ 40,285      
    Non-GAAP operating margin   15 %     20 %    
               
    GAAP net income $ 2,105     $ 1,406      
    GAAP net income per share, basic $ 0.03       0.02      
    GAAP net income per share, diluted $ 0.03     $ 0.02      
    Non-GAAP net income $ 35,578     $ 39,388      
    Non-GAAP net income per share:          
    Basic $ 0.56     $ 0.64      
    Diluted $ 0.49     $ 0.55      
               
    Adjusted EBITDA $ 38,898     $ 46,619      
               
    Net cash provided by operating activities $ 29,757     $ 31,070      
    Free cash flow $ 24,677     $ 27,534      
                       

    For additional details on the reconciliation of non-GAAP measures and certain other business metrics to their nearest comparable GAAP measures, please refer to the accompanying financial data tables included in this press release. The prior year period reflects an immaterial correction. Refer to Note 16, Immaterial Correction of an Error, in the notes to our unaudited condensed consolidated financial statements for further information.

    Recent Business Highlights

    • In April, Rapid7 launched unified threat-informed remediation for its Command Platform, delivering effective remediation at scale via proactive exposure remediation and AI-assisted automated detection and response. In addition to these enhancements to the Command Platform, Rapid7 also launched Breach Protection Warranty, offering MTC (Managed Thread Complete) Ultimate customers up to $1,000,000 in coverage embedded directly into the service.
    • In April, Rapid7 launched Managed Detection & Response (MDR) for Enterprise, a fully managed and customizable detection and response service designed to meet the unique demands of complex, distributed enterprise environments.
    • In April, Rapid7 introduced Intelligence Hub within its Command Platform, an integrated threat intelligence solution designed to provide security teams with meaningful context and actionable insights for accelerated detection and response.
    • In March, Rapid7 announced the appointment of three new members to its Board of Directors: Wael Mohamed, Mike Burns, and Kevin Galligan. These strategic appointments reinforce the company’s commitment to scaling the business, enhancing operational efficiency, and driving long-term shareholder returns.
    • In March, Rapid7 announced plans for expansion in India, including the opening of a global capacity center, which will serve as a Security Operations Center (SOC) and innovation hub to house technology, security operations, customer support, and IT teams.

    Second Quarter and Full Year 2025 Guidance

    Rapid7 anticipates ARR, revenue, non-GAAP income from operations, non-GAAP net income per share and free cash flow to be in the following ranges:

      Second Quarter 2025   Full-Year 2025
      (in millions, except per share data)
    ARR         $850 to $880
    Year-over-year growth         1% to 5%
    Revenue $211 to $213   $853 to $863
    Year-over-year growth 1% to 2%   1% to 2%
    Non-GAAP income from operations $30 to $32   $125 to $135
    Non-GAAP net income per share $0.43 to $0.46   $1.78 to $1.91
    Weighted average shares outstanding 75.3   76.7
    Free cash flow         $125 to $135
                   

    The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. Guidance for the second quarter 2025 does not include any potential impact of foreign exchange gains or losses. The guidance provided above is based on a number of assumptions, estimates and expectations as of the date of this press release and, while presented with numerical specificity, this guidance is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Rapid7’s control and are based upon specific assumptions with respect to future business decisions or economic conditions, some of which may change. Rapid7 undertakes no obligation to update guidance after this date.

    Non-GAAP guidance excludes estimates for stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs, and certain other items such as acquisition-related expenses, impairment of long-lived assets, restructuring expense, induced conversion expense, change in the fair value of derivative assets, litigation-related expenses and discrete tax items. Rapid7 has provided a reconciliation of each non-GAAP guidance measure to the most comparable GAAP measures in the financial statement tables included in this press release. The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty.

    Conference Call and Webcast Information

    Rapid7 will host a conference call today, May 12, 2025, to discuss its results at 4:30 p.m. Eastern Time. The call will be accessible by telephone at 888-330-2384 (domestic) or +1 240-789-2701 (international) with the event code 8484206. The call will also be available live via webcast on Rapid7’s website at https://investors.rapid7.com. A webcast replay of the conference call will be available at https://investors.rapid7.com.

    About Rapid7

    Rapid7 (Nasdaq: RPD) is on a mission to create a safer digital world by making cybersecurity simpler and more accessible. We empower security professionals to manage a modern attack surface through our best-in-class technology, leading-edge research, and broad, strategic expertise. Rapid7’s comprehensive security solutions help more than 11,000 global customers unite cloud risk management and threat detection to reduce attack surfaces and eliminate threats with speed and precision. For more information, visit our website, check out our blog, or follow us on LinkedIn or Twitter.

    Non-GAAP Financial Measures and Other Metrics

    To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we provide investors with certain non-GAAP financial measures and other metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We also use certain non-GAAP financial measures as performance measures under our executive bonus plan. We believe that these non-GAAP financial measures and other metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

    While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, you should review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate our business.

    Non-GAAP Financial Measures

    We disclose the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, adjusted EBITDA and free cash flow. We also disclose non-GAAP gross margin and non-GAAP operating margin derived from these financial measures.

    We define non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share as the respective GAAP balances excluding the effect of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs and certain other items such as acquisition-related expenses, impairment of long-lived assets, change in the fair value of derivative assets, restructuring expense, induced conversion expense and discrete tax items. Non-GAAP net income per basic and diluted share is calculated as non-GAAP net income divided by the weighted average shares used to compute net income per share, with the number of weighted average shares decreased, when applicable, to reflect the anti-dilutive impact of the capped call transactions entered into in connection with our convertible senior notes.

    We believe these non-GAAP financial measures are useful to investors in assessing our operating performance due to the following factors:

    Stock-based compensation expense. We exclude stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact our non-cash expense. We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period.

    Amortization of acquired intangible assets. We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.

    Amortization of debt issuance costs. The expense for the amortization of debt issuance costs related to our convertible senior notes and our former revolving credit facility is a non-cash item, and we believe the exclusion of this interest expense provides a more useful comparison of our operational performance in different periods.

    Induced conversion expense. In conjunction with the third quarter of 2023 partial repurchase of our 2.25% convertible senior notes due 2025, we incurred a non-cash induced conversion expense of $53.9 million. We exclude induced conversion expense because this amount is not indicative of the performance of or trends in our business, and neither is comparable to the prior period nor predictive of future results.

    Litigation-related expenses. We exclude non-ordinary course litigation expense because we do not consider legal costs and settlement fees incurred in litigation and litigation-related matters of non-ordinary course lawsuits and other disputes to be indicative of our core operating performance. We do not adjust for ordinary course legal expenses, including legal costs and settlement fees resulting from maintaining and enforcing our intellectual property portfolio and license agreements.

    Acquisition-related expenses. We exclude acquisition-related expenses, including accretion expense associated with contingent consideration, as costs that are unrelated to the current operations and are neither comparable to the prior period nor predictive of future results.

    Change in fair value of derivative assets. The expense for the change in fair value of derivative assets related to our 2023 capped calls settlement is a non-cash item and we believe the exclusion of this other income (expense) provides a more useful comparison of our operational performance in different periods.

    Impairment of long-lived assets. Impairment of long-lived assets consists of impairment charges allocated to the carrying amount of certain operating right-of-use assets and the associated leasehold improvements when the carrying amounts exceed their respective fair values and we believe the exclusion of the impairment charges provides a more useful comparison of our operational performance in different periods.

    Restructuring expense. We exclude non-ordinary course restructuring expenses related to our restructuring plan, that was completed during fiscal year 2024, because we do not believe these charges are indicative of our core operating performance and we believe the exclusion of the restructuring expenses provides a more useful comparison of our performance in different periods.

    Discrete tax items. We exclude certain discrete tax items such as income tax expenses or benefits that are not related to ongoing business operations in the current year and adjustments to uncertain tax position reserves as these charges are not indicative of our ongoing operating results, and they are not considered when we are forecasting our future results.

    Anti-dilutive impact of capped call transaction. Our capped call transactions are intended to offset potential dilution from the conversion features in our convertible senior notes. Although we cannot reflect the anti-dilutive impact of the capped call transactions under GAAP, we do reflect the anti-dilutive impact of the capped call transactions in non-GAAP net income (loss) per diluted share, when applicable, to provide investors with useful information in evaluating our financial performance on a per share basis.

    Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure that we define as net income (loss) before (1) interest income, (2) interest expense, (3) other (income) expense, net, (4) provision for (benefit from) income taxes, (5) depreciation expense, (6) amortization of intangible assets, (7) stock-based compensation expense, (8) acquisition-related expenses, and (9) restructuring expense. We believe that the use of adjusted EBITDA is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods.

    Free Cash Flow. Free cash flow is a non-GAAP measure that we define as cash provided by operating activities less purchases of property and equipment and capitalization of internal-use software costs. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures.

    Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact upon our reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in our business and an important part of the compensation provided to our employees.

    Other Metrics

    ARR. ARR is defined as the annual value of all recurring revenue related to contracts in place at the end of the period. ARR should be viewed independently of revenue and deferred revenue as ARR is an operating metric and is not intended to be combined with or replace these items. ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates, and does not include revenue reported as professional services revenue in our consolidated statement of operations.

    Number of Customers. We define a customer as any entity that has an active Rapid7 recurring revenue contract as of the specified measurement date, excluding InsightOps and Logentries only customers with a contract value of less than $2,400 per year.

    ARR per Customer. We define ARR per customer as ARR divided by the number of customers at the end of the period.

    Cautionary Language Concerning Forward-Looking Statements

    This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the statements regarding our financial guidance for the second quarter and full-year 2025, and the assumptions underlying such guidance. Our use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. The events described in our forward-looking statements are subject to a number of risks and uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Risks that could cause or contribute to such differences include, but are not limited to, growing macroeconomic uncertainty, unstable market and economic conditions, fluctuations in our quarterly results, our ability to successfully grow our sales of our cloud-based solutions, including through the shift to a consolidated platform sales approach, effectiveness of our restructuring plan that was completed during fiscal year 2024, failure to meet our publicly announced guidance or other expectations about our business, our ability to sustain our revenue growth rate, the ability of our products and professional services to correctly detect vulnerabilities, renewal of our customer’s subscriptions, competition in the markets in which we operate, market growth, our ability to innovate and manage our growth, our sales cycles, our ability to integrate acquired companies, exposure to greater than anticipated tax liabilities, and our ability to operate in compliance with applicable laws as well as other risks and uncertainties that could affect our business and results described in our filings with the Securities and Exchange Commission (the “SEC”), including our most recent Annual Report on Form 10-K filed with the SEC on February 28, 2025, particularly in the section entitled “Item 1.A Risk Factors,” and in the subsequent reports that we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed in any forward-looking statements we may make. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

    Investor contact:

    Elizabeth Chwalk
    Vice President, Investor Relations
    investors@rapid7.com
    (617) 865-4277

    Press contact:

    Alice Randall
    Director, Global Corporate Communications
    press@rapid7.com
    (214) 693-4727

     
    RAPID7, INC.
    Consolidated Balance Sheets (Unaudited)
    (in thousands)
             
        March 31, 2025   December 31, 2024
    Assets        
    Current assets:        
    Cash and cash equivalents   $ 291,462     $ 334,686  
    Short-term investments     202,011       187,025  
    Accounts receivable, net     140,541       168,242  
    Deferred contract acquisition and fulfillment costs, current portion     50,667       52,134  
    Prepaid expenses and other current assets     47,964       44,024  
    Total current assets     732,645       786,111  
    Long-term investments     99,136       37,274  
    Property and equipment, net     31,659       32,245  
    Operating lease right-of-use assets     46,404       48,877  
    Deferred contract acquisition and fulfillment costs, non-current portion     69,843       73,672  
    Goodwill     575,268       575,268  
    Intangible assets, net     79,763       85,719  
    Other assets     10,092       12,868  
    Total assets   $ 1,644,810     $ 1,652,034  
    Liabilities and Stockholders’ Equity        
    Current liabilities:        
    Accounts payable   $ 12,318     $ 18,908  
    Accrued expenses and other current liabilities     69,458       88,802  
    Convertible senior notes, current portion, net     45,967       45,895  
    Operating lease liabilities, current portion     13,614       15,493  
    Deferred revenue, current portion     447,798       461,118  
    Total current liabilities     589,155       630,216  
    Convertible senior notes, non-current portion, net     889,303       888,356  
    Operating lease liabilities, non-current portion     65,484       68,430  
    Deferred revenue, non-current portion     27,524       27,078  
    Other long-term liabilities     20,622       20,243  
    Total liabilities     1,592,088       1,634,323  
    Stockholders’ equity:        
    Common stock   $ 642     $ 635  
    Treasury stock     (4,765 )     (4,765 )
    Additional paid-in-capital     1,042,355       1,011,080  
    Accumulated other comprehensive (loss) income     419       (1,205 )
    Accumulated deficit     (985,929 )     (988,034 )
    Total stockholders’ equity     52,722       17,711  
    Total liabilities and stockholders’ equity   $ 1,644,810     $ 1,652,034  
                     

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Consolidated Statements of Operations (Unaudited)
    (in thousands, except share and per share data)
       
      Three Months Ended March 31,
      2025   2024
    Revenue:      
    Product subscriptions $ 203,935     $ 196,918  
    Professional services   6,318       8,183  
    Total revenue   210,253       205,101  
    Cost of revenue:      
    Product subscriptions   54,368       54,734  
    Professional services   5,112       6,260  
    Total cost of revenue   59,480       60,994  
    Total gross profit   150,773       144,107  
    Operating expenses:      
    Research and development   47,888       41,368  
    Sales and marketing   79,400       73,095  
    General and administrative   23,586       19,928  
    Total operating expenses   150,874       134,391  
    (Loss) income from operations   (101 )     9,716  
    Other income (expense), net:      
    Interest income   5,758       4,720  
    Interest expense   (2,654 )     (2,670 )
    Other income (expense), net   1,802       (1,435 )
    Income before income taxes   4,805       10,331  
    Provision for income taxes   2,700       8,925  
    Net income $ 2,105     $ 1,406  
    Net income per share, basic $ 0.03     $ 0.02  
    Net income per share, diluted (1) $ 0.03     $ 0.02  
    Weighted-average common shares outstanding, basic   63,835,945       61,907,808  
    Weighted-average common shares outstanding, diluted   64,224,415       74,021,704  
                   

    (1) We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive. On an if-converted basis, for the three months ended March 31, 2025 and 2024, the 2025, 2027 and 2029 Notes were anti-dilutive.

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Consolidated Statements of Cash Flows (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    Cash flows from operating activities:      
    Net income $ 2,105     $ 1,406  
    Adjustments to reconcile net income to net cash provided by operating activities:      
    Depreciation and amortization   11,665       11,348  
    Amortization of debt issuance costs   1,019       1,053  
    Stock-based compensation expense   27,151       25,745  
    Deferred income taxes         1,840  
    Other   (1,153 )     (203 )
    Changes in assets and liabilities:      
    Accounts receivable   27,668       39,529  
    Deferred contract acquisition and fulfillment costs   5,295       (679 )
    Prepaid expenses and other assets   (1,995 )     (1,223 )
    Accounts payable   (6,555 )     (4,190 )
    Accrued expenses   (20,325 )     (24,890 )
    Deferred revenue   (12,874 )     (21,186 )
    Other liabilities   (2,244 )     2,520  
    Net cash provided by operating activities   29,757       31,070  
    Cash flows from investing activities:      
    Purchases of property and equipment   (1,361 )     (620 )
    Capitalization of internal-use software   (3,719 )     (2,916 )
    Purchases of investments   (144,461 )     (93,158 )
    Sales and maturities of investments   69,000       55,000  
    Other investing activities   1,328        
    Net cash used in investing activities   (79,213 )     (41,694 )
    Cash flows from financing activities:      
    Taxes paid related to net share settlement of equity awards   (1,303 )     (1,764 )
    Proceeds from employee stock purchase plan   4,446       5,046  
    Proceeds from stock option exercises   1,589       1,080  
    Net cash provided by financing activities   4,732       4,362  
    Effect of exchange rate changes on cash ,cash equivalents and restricted cash   1,334       (1,493 )
    Net decrease in cash, cash equivalents and restricted cash   (43,390 )     (7,755 )
    Cash, cash equivalents and restricted cash, beginning of period $ 342,101     $ 214,130  
    Cash, cash equivalents and restricted cash, end of period $ 298,711     $ 206,375  
    Supplemental cash flow information:      
    Cash paid for interest on convertible senior notes   1,571       2,698  
    Cash paid for income taxes, net of refunds   992       2,352  
    Reconciliation of cash, cash equivalents and restricted cash:      
    Cash and cash equivalents $ 291,462     $ 198,716  
    Restricted cash included in prepaid expenses and other current assets and other assets   7,249       7,659  
    Total cash, cash equivalents and restricted cash $ 298,711     $ 206,375  
                   

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    GAAP to Non-GAAP Reconciliation (Unaudited)
    (in thousands, except share and per share data)
       
      Three Months Ended March 31,
      2025   2024
    GAAP gross profit $ 150,773     $ 144,107  
    Add: Stock-based compensation expense1   2,264       2,671  
    Add: Amortization of acquired intangible assets2   4,423       4,317  
    Non-GAAP gross profit $ 157,460     $ 151,095  
    Non-GAAP gross margin   74.9 %     73.7 %
           
    GAAP gross profit – Product subscriptions $ 149,567     $ 142,184  
    Add: Stock-based compensation expense   1,731       2,298  
    Add: Amortization of acquired intangible assets   4,423       4,317  
    Non-GAAP gross profit – Product subscriptions $ 155,721     $ 148,799  
    Non-GAAP gross margin – Product subscriptions   76.4 %     75.6 %
           
    GAAP gross profit – Professional services $ 1,206     $ 1,923  
    Add: Stock-based compensation expense   533       373  
    Non-GAAP gross profit – Professional services $ 1,739     $ 2,296  
    Non-GAAP gross margin – Professional services   27.5 %     28.1 %
           
    GAAP (loss) income from operations $ (101 )   $ 9,716  
    Add: Stock-based compensation expense1   27,151       25,745  
    Add: Amortization of acquired intangible assets2   5,120       5,014  
    Add: Acquisition-related expenses3   183        
    Add: Restructuring expense         (190 )
    Non-GAAP income from operations $ 32,353     $ 40,285  
           
    GAAP net income $ 2,105     $ 1,406  
    Add: Stock-based compensation expense1   27,151       25,745  
    Add: Amortization of acquired intangible assets2   5,120       5,014  
    Add: Amortization of debt issuance costs   1,019       1,053  
    Add: Acquisition-related expenses3   183        
    Add: Restructuring expense4         (190 )
    Add: Discrete tax items5         6,360  
    Non-GAAP net income $ 35,578     $ 39,388  
    Add: Interest expense of convertible senior notes6   1,571       1,571  
    Numerator for non-GAAP earnings per share, diluted calculation $ 37,149     $ 40,959  
           
    Weighted average shares used in GAAP earnings per share calculation, basic   63,835,945       61,907,808  
    Dilutive effect of convertible senior notes6   11,183,611       11,183,611  
           
    Dilutive effect of employee equity incentive plans7   388,471       930,195  
    Weighted average shares used in non-GAAP earnings per share calculation, diluted   75,408,027       74,021,614  
           
    Non-GAAP net income per share:      
    Basic $ 0.56     $ 0.64  
    Diluted $ 0.49     $ 0.55  
           
    Includes stock-based compensation expense as follows:      
    Cost of revenue $ 2,264     $ 2,671  
    Research and development   10,386       7,944  
    Sales and marketing   7,241       7,137  
    General and administrative   7,260       7,993  
           
    Includes amortization of acquired intangible assets as follows:      
    Cost of revenue $ 4,423     $ 4,317  
    Sales and marketing   652       652  
    General and administrative   45       45  
           
    Includes acquisition-related expenses as follows:      
    General and administrative $ 183     $  
           
    For the three months ended March 31, 2024 restructuring expense was included within general and administrative expense in our consolidated statements of operations.
           
    Includes discrete tax items as follows:
    Provision for income taxes $     $ 6,360  
           
    We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive.
           
    We use the treasury method to compute the dilutive effect of employee equity incentive plan awards.
           

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Reconciliation of Net Income (Loss) to Adjusted EBITDA (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    GAAP net income $ 2,105     $ 1,406  
    Interest income   (5,758 )     (4,720 )
    Interest expense   2,654       2,670  
    Other (income) expense, net   (1,802 )     1,435  
    Provision for (benefit from) income taxes   2,700       8,925  
    Depreciation expense   2,791       2,908  
    Amortization of intangible assets   8,874       8,440  
    Stock-based compensation expense   27,151       25,745  
    Acquisition-related expenses   183        
    Restructuring expense         (190 )
    Adjusted EBITDA $ 38,898     $ 46,619  
                   

    Note: Certain prior period reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    Net cash provided by operating activities $ 29,757     $ 31,070  
    Less: Purchases of property and equipment   (1,361 )     (620 )
    Less: Capitalized internal-use software costs   (3,719 )     (2,916 )
    Free cash flow $ 24,677     $ 27,534  
                   
     
    Second Quarter and Full-Year 2025 Guidance
    GAAP to Non-GAAP Reconciliation
    (in millions, except per share data)
           
      Second Quarter 2025   Full-Year 2025
    Reconciliation of GAAP income from operations to non-GAAP income from operations:              
    Anticipated GAAP loss from operations $ (2 ) to $     $ (11 ) to $ (1 )
    Add: Anticipated stock-based compensation expense   27   to   27       116   to   116  
    Add: Anticipated amortization of acquired intangible assets   5   to   5       20   to   20  
    Anticipated non-GAAP income from operations $ 30   to $ 32     $ 125   to $ 135  
                   
    Reconciliation of GAAP net income to non-GAAP net income:              
    Anticipated GAAP net loss $ (2 ) to $     $ (9 ) to $ 1  
    Add: Anticipated stock-based compensation expense   27   to   27       116   to   116  
    Add: Anticipated amortization of acquired intangible assets   5   to   5       20   to   20  
    Add: Anticipated amortization of debt issuance costs   1   to   1       4   to   4  
    Anticipated non-GAAP net income $ 31   to $ 33     $ 131   to $ 141  
    Add: Anticipated interest expense on convertible senior notes   1.4   to   1.4       5.6   to   5.6  
    Numerator for non-GAAP earnings per share calculation $ 32.4   to $ 34.4     $ 136.6   to $ 146.6  
                   
    Anticipated GAAP net (loss) income per share1 $ (0.03 )   $     $ (0.14 )   $ 0.02  
    Anticipated non-GAAP net income per share, diluted $ 0.43     $ 0.46     $ 1.78     $ 1.91  
                   
    Weighted average shares used in earnings per share calculation, diluted 75.3   76.7
                   
    The anticipated GAAP net loss per share is calculated using basic weighted average shares for periods in which the Company anticipated a GAAP net loss. The anticipated GAAP net income per share is calculated using GAAP diluted weighted average shares for periods in which the Company anticipated GAAP net income.
     

    The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty. As a result, the estimates shown for Anticipated GAAP loss from operations, Anticipated GAAP net loss and Anticipated GAAP net loss per share are expected to change.

       
      Full-Year 2025
    Reconciliation of net cash provided by operating activities to free cash flow:      
    Anticipated net cash provided by operating activities $ 146   to $ 156  
    Less: Anticipated purchases of property and equipment   (7 ) to   (7 )
    Less: Anticipated capitalized internal-use software costs   (14 ) to   (14 )
    Anticipated free cash flow $ 125     $ 135  
                   

    The MIL Network

  • MIL-OSI: Lantronix Appoints Sailesh Chittipeddi to Its Board of Directors

    Source: GlobeNewswire (MIL-OSI)

    IRVINE, Calif., May 12, 2025 (GLOBE NEWSWIRE) — Lantronix Inc. (NASDAQ: LTRX), a global leader of compute and connectivity for IoT solutions enabling Edge AI Intelligence, today announced that Sailesh Chittipeddi, Ph.D., has joined the Lantronix Board of Directors as an independent director, effective May 6, 2025. Following the appointment of Chittipeddi, the Lantronix Board of Directors will be comprised of five directors, four of whom are independent under applicable listing standards of the Nasdaq Stock Market.

    “We are very pleased to welcome Dr. Chittipeddi to the Lantronix Board of Directors,” said Hoshi Printer, chairman of the Board at Lantronix. “Dr. Chittipeddi is a respected subject expert in Industrial, IoT and Infrastructure businesses. He also has an extensive background in leading operations, procurement and supply chains globally.”

    Dr. Chittipeddi is currently a Venture Partner at Novo Tellus Capital Partners, a Singapore-based private equity firm, and a Board Member at Tessolve, which is headquartered in India. Most recently, he was executive vice president of Global Operations at Renesas Electronics, where he oversaw internal and external manufacturing and associated functions, including supply chain, procurement and related development.

    “Lantronix will benefit greatly from Dr. Chittipeddi’s extensive technology and broad industry expertise, including his service on boards of several global companies where he helped drive successful results,” added Saleel Awsare, CEO and president of Lantronix. “With his expertise in manufacturing, procurement, logistics and global supply chain strategy, Dr. Chittipeddi adds a valuable perspective as we navigate complex geopolitical and associated supply chain environment challenges.”

    At Renesas, Dr. Chittipeddi also served as executive vice president of its Industrial, IoT and Infrastructure Business Unit. In this capacity, he nearly doubled the revenue to more than $7 billion USD. This business unit included the microcontroller, power and analog-mixed signal businesses of former IDT, ISL and DLG acquisition companies. He joined Renesas in 2019 following its acquisition of IDT. In this capacity, he also served as the president of Renesas Electronics America as well as the CEO of its acquired IDT Division.

    Before his tenures at Renesas and IDT, Dr. Chittipeddi held numerous senior positions at other leading technology companies, including Conexant Systems, where he served as the CEO and president, as well as AT&T Bell Labs, Lucent Technologies and Agere Systems. He has also served on global public and private boards, including Sequans Communications, Tessolve (India), Avalanche Technologies (India), Steradian (India), Blu Wireless Technology (U.K.) and Peraso (Canada).

    Dr. Chittipeddi holds an MBA from the University of Texas at Austin and a Ph.D. in Physics from The Ohio State University. He holds 83 U.S. semiconductor process, package and design patents and has published more than 40 technical articles.

    About Lantronix

    Lantronix Inc. is a global leader of compute and connectivity IoT solutions that target high-growth markets, including Smart Cities, Enterprise and Transportation. Lantronix’s products and services empower companies to succeed in the growing IoT markets by delivering customizable solutions that enable AI Edge Intelligence. Lantronix’s advanced solutions include Intelligent Substations infrastructure, Infotainment systems and Video Surveillance, supplemented with advanced Out-of-Band Management (OOB) for Cloud and Edge Computing.

    For more information, visit the Lantronix website.

    ©2025 Lantronix, Inc. All rights reserved. Lantronix is a registered trademark. Other trademarks and trade names are those of their respective owners.

    Lantronix Media Contact:
    Gail Kathryn Miller
    Corporate Marketing &
    Communications Manager
    media@lantronix.com

    Lantronix Analyst and Investor Contact:
    investors@lantronix.com

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/d04b3fa2-b8d8-4656-adad-c8d4eb6267c4

    The MIL Network

  • MIL-OSI: OptimizeRx Reports First Quarter 2025 Financial Results and Updates Fiscal Year 2025 Guidance

    Source: GlobeNewswire (MIL-OSI)

    • Q1 revenue of $21.9 million, increasing 11% year-over-year
    • Q1 gross profit increased 9% year-over-year to $13.3 million
    • Increases full year 2025 guidance to a revenue range between $101 million and $106 million and adjusted EBITDA range between $13 million and $15 million

    WALTHAM, Mass., May 12, 2025 (GLOBE NEWSWIRE) — OptimizeRx Corp. (the “Company”) (Nasdaq: OPRX), a leading provider of healthcare technology solutions helping life sciences companies reach and engage healthcare professionals (HCPs) and patients, today reported results for the three months ended March 31, 2025. Quarterly comparisons are to the same year-ago period.

    Financial Highlights

    • Revenue in the first quarter of 2025 increased 11% to $21.9 million, as compared to $19.7 million in the same year ago period
    • Gross profit in the first quarter of 2025 increased 9% year-over-year to $13.3 million, from $12.2 million during the first quarter of 2024
    • GAAP net loss totaled $(2.2) million or $(0.12) per basic and diluted share in the first quarter of 2025, as compared to $(6.9) million or $(0.38) per basic and diluted share during the first quarter of 2024
    • Non-GAAP net income in the first quarter totaled $1.5 million or $0.08 per diluted share, as compared to Non-GAAP net loss of $(2.0) million or $(0.11) per diluted share during the first quarter of 2024 (see *Non-GAAP Measures below)
    • Adjusted EBITDA for the first quarter of 2025 increased to $1.5 million compared to $(0.3) million in the same year ago period (see *Non-GAAP Measures below)
    • Cash, cash equivalents and short-term investments totaled $16.6 million as of March 31, 2025, as compared to $13.4 million as of December 31, 2024

    Stephen L. Silvestro, OptimizeRx CEO commented, “I’m encouraged by our year-to-date performance, which has exceeded both consensus estimates and our internal expectations. The momentum we saw at the end of 2024 has carried into 2025, with year-to-date contracted revenue up more than 20% compared to the same period last year—positioning us well for a strong second half of the year. I believe this performance clearly reflects the results of our focus on operational excellence, our commitment to delighting customers, and our efforts to deepen relationships with valued business partners, all of which are driving meaningful shareholder value.

    “At the same time, we’ve already converted over 5% of our expected 2025 sales into subscription-based revenue streams. I believe this transition, combined with our improving operating leverage, puts us on a strong path toward achieving Rule of 40 performance in the coming years.

    “Given our strong performance and positive outlook, I’m pleased to announce that we are raising our full-year guidance. We now expect the revenue range to be between $101 million and $106 million, and adjusted EBITDA to be between $13 million and $15 million.”

      Rolling Twelve Months Ended March 31,
    Key Performance Indicators (KPIs)**  2025     2024 
      (in thousands, except percentages)
    Average revenue per top 20 pharmaceutical manufacturer $ 2,960     $ 2,592  
    Percent of total revenue attributable to top 20 pharmaceutical manufacturers   63 %     66 %
    Net revenue retention   114 %     116 %
    Revenue per average full-time employee $ 710     $ 641  

    2025 Financial Outlook

    The Company is increasing its 2025 guidance and expects revenue to be between $101 million and $106 million with Adjusted EBITDA to be between $13 million and $15 million.

    Conference Call

    Individual Meeting Invitation

    In an effort to increase relations with institutional investors, OptimizeRx management has dedicated time to hosting individual meetings with portfolio managers and analysts. If you are interested in scheduling a meeting with OptimizeRx management, please contact: adsilva@optimizerx.com or shalper@lifesciadvisors.com.

    *Non-GAAP Measures

    In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains non-GAAP financial measures. The reasons why we believe these measures provide useful information to investors and, for historical periods, a reconciliation of these measures to the most directly comparable GAAP measures are included in the supplemental tables that follow.

    Although the Company provides guidance for Adjusted EBITDA, a non-GAAP financial measure, it is not able to provide guidance to the most directly comparable GAAP measure. Reconciliations for forward-looking figures would require unreasonable effort at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including, for example, those related to compensation, acquisition expenses, other income, amortization or others that may arise during the year, and the Company’s management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. For the same reasons, the Company is unable to address the probable significance of the unavailable information.

    **Definition of Key Performance Indicators

    Top 20 pharmaceutical manufacturers: We have updated the definition of “top 20 pharmaceutical manufacturers” in our key performance indicators to be based upon Fierce Pharma’s most updated list of “The top 20 pharma companies by 2024 revenue”. We previously used “The top 20 pharma companies by 2023 revenue”. As a result of this change, prior periods have been restated for comparative purposes.

    Net revenue retention: Net revenue retention is a comparison of revenue generated from all clients in the previous period to total revenue generated from the same clients in the following year (i.e., excludes new client relationships for the most recent year).

    Revenue per average full-time employee: We define revenue per average full-time employee (FTE) as total revenue over the last 12 months (LTM) divided by the average number of employees over the LTM, which is calculated by taking our total number of FTEs at the end of the prior year period by our total FTE headcount at the end of the most recent period.

    About OptimizeRx

    OptimizeRx is a leading healthcare technology company that’s redefining how life science brands connect with patients and healthcare providers. Our platform combines innovative AI-driven tools like the Dynamic Audience Activation Platform (DAAP) and Micro-Neighborhood Targeting (MNT) to deliver timely, relevant, and hyper-local engagement. By bridging the gap between HCP and DTC strategies, we empower brands to create synchronized marketing solutions that drive faster treatment decisions and improved patient outcomes.

    Our commitment to privacy-safe, patient-centric technology ensures that every interaction is designed to make a meaningful impact, delivering life-changing therapies to the right patients at the right time. Headquartered in Waltham, Massachusetts, OptimizeRx partners with some of the world’s leading pharmaceutical and life sciences companies to transform the healthcare landscape and create a healthier future for all.

    For more information, follow the Company on Twitter, LinkedIn or visit www.optimizerx.com.  

    Important Cautions Regarding Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipates”, “believes”, “estimates”, “expects”, “forecasts”, “intends”, “plans”, “projects”, “targets”, “designed”, “could”, “may”, “should”, “will” or other similar words and expressions are intended to identify these forward-looking statements. All statements that reflect the Company’s expectations, assumptions, projections, beliefs or opinions about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements relating to the Company’s future performance, expected revenues, expected Adjusted EBITDA, plans to grow shareholder value creation, plans to continue the Company’s growth and transformation, plans to position the Company to become a “Rule of 40” company, plans for forging stronger relationships with valued business partners, and other statements relating to future performance, plans, and expectations. These forward-looking statements are based on the Company’s current expectations and involve assumptions regarding the Company’s business, the economy, and other future conditions that may never materialize or may prove to be incorrect. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted, or quantified. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties including, but not limited to, the effect of government regulation, seasonal trends, dependence on a concentrated group of customers, cybersecurity incidents that could disrupt operations, the ability to keep pace with growing and evolving technology, the ability to maintain contracts with electronic prescription platforms and electronic health records networks, competition, and other factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, its subsequent Quarterly Reports on Form 10-Q, and in other filings the Company has made and may make with the Securities and Exchange Commission in the future. One should not place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. The Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as may be required by law.

    OptimizeRx Contact
    Andy D’Silva, SVP Corporate Finance
    adsilva@optimizerx.com

    Investor Relations Contact
    Steven Halper
    LifeSci Advisors, LLC
    shalper@lifesciadvisors.com

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (in thousands, except share and per share data)

      March 31,
    2025
      December 31,
    2024
    ASSETS (unaudited)    
    Current assets      
    Cash and cash equivalents $ 16,573     $ 13,380  
    Accounts receivable, net of allowance for credit losses of $335 at March 31, 2025 and December 31, 2024   32,720       38,212  
    Taxes receivable   113        
    Prepaid expenses and other   2,305       2,379  
    Total current assets   51,711       53,971  
    Property and equipment, net   150       150  
    Other assets      
    Goodwill   70,869       70,869  
    Patent rights, net   5,349       5,517  
    Technology assets, net   7,931       8,180  
    Tradename and customer relationships, net   31,226       31,819  
    Operating lease right of use assets   303       366  
    Security deposits and other assets   229       296  
    Total other assets   115,907       117,047  
    TOTAL ASSETS $ 167,768     $ 171,168  
           
    LIABILITIES AND STOCKHOLDERS’ EQUITY      
    Current liabilities      
    Current portion of long-term debt $ 3,300     $ 2,000  
    Accounts payable   3,381       2,156  
    Accrued expenses   9,277       8,486  
    Revenue share payable   1,743       5,053  
    Taxes payable         318  
    Current portion of lease liabilities   139       168  
    Deferred revenue   511       473  
    Total current liabilities   18,351       18,654  
    Non-current liabilities      
    Long-term debt, net   29,190       30,816  
    Lease liabilities, net of current portion   171       209  
    Deferred tax liabilities, net   3,786       4,491  
    Total liabilities   51,498       54,170  
           
    Stockholders’ equity      
    Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding at March 31, 2025 or December 31, 2024          
    Common stock, $0.001 par value, 166,666,667 shares authorized, 20,234,186 and 20,194,697 shares issued at March 31, 2025 and December 31, 2024, respectively   20       20  
    Treasury stock, $0.001 par value, (1,741,397) shares held at March 31, 2025 and December 31, 2024   (2 )     (2 )
    Additional paid-in-capital   202,819       201,348  
    Accumulated deficit   (86,567 )     (84,368 )
    Total stockholders’ equity   116,270       116,998  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 167,768     $ 171,168  
     

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except share and per share data, unaudited)

      For the Three Months Ended
    March 31,
       2025     2024 
           
    Net revenue $ 21,928     $ 19,690  
    Cost of revenues, exclusive of depreciation and amortization presented separately below   8,584       7,486  
    Gross profit   13,344       12,204  
           
    Operating expenses      
    General and administrative expenses   14,364       16,166  
    Depreciation and amortization   1,094       1,067  
    Total operating expenses   15,458       17,233  
    Loss from operations   (2,114 )     (5,029 )
    Other income (expense)      
    Interest expense   (1,297 )     (1,546 )
    Other income   39        
    Interest income   88       20  
    Total other expense, net   (1,170 )     (1,526 )
    Loss before provision for income taxes   (3,284 )     (6,555 )
    Income tax benefit (expense)   1,085       (344 )
    Net loss $ (2,199 )   $ (6,899 )
    Weighted average number of shares outstanding – basic   18,470,808       18,170,108  
    Weighted average number of shares outstanding – diluted   18,470,808       18,170,108  
    Loss per share – basic $ (0.12 )   $ (0.38 )
    Loss per share – diluted $ (0.12 )   $ (0.38 )
     

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands, unaudited)

      For the Three Months Ended
    March 31,
      2025   2024
    CASH FLOWS FROM OPERATING ACTIVITIES:      
    Net loss $ (2,199 )   $ (6,899 )
    Adjustments to reconcile net loss to net cash provided by operating activities:      
    Depreciation and amortization   1,094       1,067  
    Stock-based compensation   1,558       3,024  
    Bad debt reserve         132  
    Amortization of debt issuance costs   174       182  
    Changes in:      
    Accounts receivable   5,492       6,373  
    Prepaid expenses and other assets   74       800  
    Accounts payable   1,225       (562 )
    Revenue share payable   (3,310 )     (2,692 )
    Accrued expenses and other liabilities   854       (362 )
    Taxes receivable and payable   (431 )     323  
    Deferred tax liabilities   (705 )      
    Deferred revenue   38       732  
    NET CASH PROVIDED BY OPERATING ACTIVITIES   3,864       2,118  
           
    CASH FLOWS USED IN INVESTING ACTIVITIES:      
    Purchase of property and equipment   (27 )     (32 )
    Capitalized software development costs   (57 )     (121 )
    NET CASH USED IN INVESTING ACTIVITIES   (84 )     (153 )
           
    CASH FLOWS USED IN FINANCING ACTIVITIES:      
    Cash paid for employee withholding taxes related to the vesting of restricted stock units   (87 )     (140 )
    Repayment of long-term debt   (500 )     (500 )
    NET CASH USED IN FINANCING ACTIVITIES   (587 )     (640 )
    NET INCREASE IN CASH AND CASH EQUIVALENTS   3,193       1,325  
    CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD   13,380       13,852  
    CASH AND CASH EQUIVALENTS – END OF PERIOD $ 16,573     $ 15,177  
           
    SUPPLEMENTAL CASH FLOW INFORMATION:      
    Cash paid for interest $ 1,121     $ 1,350  
    Cash paid for income taxes $     $ 21  

    OPTIMIZERX CORPORATION
    RECONCILIATION of GAAP to NON-GAAP FINANCIAL MEASURES
    (in thousands, except share and per share data, unaudited)

    This earnings release includes certain financial measures not derived in accordance with generally accepted accounting principles (GAAP). These non-GAAP financial measures are measures of performance not defined by accounting principles generally accepted in the United States and should be considered in addition to, not in lieu of, GAAP reported measures. Additionally, these non-GAAP measures may not be comparable to similarly titled measures reported by other companies. However, management believes that presenting certain non-GAAP financial measures provides additional information to facilitate comparison of the Company’s historical operating results and trends in its underlying operating results and provides transparency on how the Company evaluates its business. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company’s performance. Management believes that financial information excluding certain items that are not considered to reflect the Company’s ongoing operating results, such as those listed below, improves the comparability of year-to-year results. Consequently, management believes that investors may be able to better understand the Company’s operating results excluding these items. Non-GAAP financial measures may reflect adjustments for items such as asset impairment charges, amortization, stock-based compensation, acquisition expenses, severance, shareholder activist related fees, CEO search fees, other income, as well as other items that management believes are not related to the Company’s ongoing performance.

      Three Months Ended March 31,
       2025     2024 
    Net loss $         (2,199 )   $         (6,899 )
    Depreciation and amortization           1,094               1,067  
    Stock-based compensation           1,558               3,024  
    Severance expenses           275               419  
    Shareholder activist related fees           451               —  
    CEO search fees           225               —  
    Other income           (39 )             —  
    Amortization of debt issuance costs           174               182  
    Acquisition expenses           —               243  
    Non-GAAP net income (loss) $         1,539     $         (1,964 )
           
    Non-GAAP net income (loss) per share      
    Diluted $         0.08     $         (0.11 )
    Weighted average shares outstanding:      
    Diluted   18,579,012       18,170,108  
      Three Months Ended March 31,
      2025   2024
    Net loss $ (2,199 )   $ (6,899 )
    Depreciation and amortization   1,094       1,067  
    Income tax (benefit) expense   (1,085 )     344  
    Stock-based compensation   1,558       3,024  
    Severance expenses   275       419  
    Acquisition expenses         243  
    Shareholder activist related fees   451        
    CEO search fees   225        
    Other income   (39 )      
    Interest expense, net   1,209       1,526  
    Adjusted EBITDA $ 1,489     $ (276 )

    The MIL Network

  • MIL-OSI: PennantPark Floating Rate Capital Ltd. Announces Financial Results for the Second Quarter Ended March 31, 2025

    Source: GlobeNewswire (MIL-OSI)

    MIAMI, May 12, 2025 (GLOBE NEWSWIRE) — PennantPark Floating Rate Capital Ltd. (NYSE: PFLT) announced today its financial results for the second quarter ended March 31, 2025.

    HIGHLIGHTS
    Quarter ended March 31, 2025 (Unaudited)
    ($ in millions, except per share amounts)
             
               
    Assets and Liabilities:          
    Investment portfolio (1)       $ 2,344.1  
    Net assets       $ 1,067.1  
    GAAP net asset value per share       $ 11.07  
    Quarterly change in GAAP net asset value per share         (2.4 )%
    Adjusted net asset value per share (2)       $ 11.07  
    Quarterly change in adjusted net asset value per share (2)         (2.4 )%
               
    Credit Facility       $ 273.8  
    2036 Asset-Backed Debt       $ 284.4  
    2036-R Asset-Backed Debt       $ 265.3  
    2026 Notes       $ 184.2  
    2037 Asset-Backed Debt       $ 358.1  
    Regulatory debt to equity       1.29x  
    Weighted average yield on debt investments at quarter-end         10.5 %
               
    Operating Results:          
    Net investment income       $ 25.0  
    Net investment income per share (GAAP)       $ 0.28  
    Core net investment income per share (3)       $ 0.28  
    Distributions declared per share       $ 0.31  
               
    Portfolio Activity:          
    Purchases of investments       $ 293.3  
    Sales and repayments of investments       $ 122.4  
               
    PSSL Portfolio data:          
    PSSL investment portfolio       $ 1,060.2  
    Purchases of investments       $ 60.0  
    Sales and repayments of investments       $ 36.8  

    (1)    Includes investments in PennantPark Senior Secured Loan Fund I LLC, or PSSL, an unconsolidated joint venture, totaling $297.3 million, at fair value.

    (2)    This is a non-GAAP financial measure. The Company believes that this number provides useful information to investors and management because it reflects the Company’s financial performance excluding the impact of the unrealized amounts on the Credit Facility. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.

    (3)    Core net investment income (“Core NII”) is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company’s financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended March 31, 2025, Core NII excluded: i) $0.4m of credit facility amendment costs and ii) $0.1m of incentive fee expense offset.

    CONFERENCE CALL AT 9:00 A.M. ET ON May 13, 2025

    PennantPark Floating Rate Capital Ltd. (“we”, “our”, “us”, or the “Company”) will also host a conference call at 9:00 a.m. (Eastern Time) on Tuesday May 13, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (888) 394-8218 approximately 5-10 minutes prior to the call. International callers should dial (929) 477-0402. All callers should reference conference ID #6661250 or PennantPark Floating Rate Capital Ltd. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark’s website.

    PORTFOLIO AND INVESTMENT ACTIVITY

    “We are pleased that we significantly increased our financial strength during the quarter. A lower cost credit facility, a new low cost long term securitization, new low cost securitization at our PSSL JV and additional equity capital at PFLT have positioned us well to take advantage of the upcoming attractive vintage of new loans,” said Art Penn, Chairman and CEO. “Additionally, we are pleased that our senior secured loan portfolio, with among the lowest portfolio company leverage and most meaningful covenants in the industry, is positioned defensively and continues to perform well.”

    As of March 31, 2025, our portfolio totaled $2,344.1 million, and consisted of $2,100.2 million of first lien secured debt (including $237.7 million in PSSL), $4.4 million of subordinated debt and $239.5 million of preferred and common equity (including $59.6 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of March 31, 2025, we had four portfolio companies on non-accrual, representing 2.2% and 1.2% of our overall portfolio on a cost and fair value basis, respectively. As of March 31, 2025, the portfolio had net unrealized depreciation of $61.2 million. Our overall portfolio consisted of 159 companies with an average investment size of $14.7 million and had a weighted average yield on debt investments of 10.5%.

    As of September 30, 2024, our portfolio totaled $1,983.5 million and consisted of $1,746.7 million of first lien secured debt (including $237.7 million in PSSL), $2.7 million of second lien secured debt and subordinated debt and $234.1 million of preferred and common equity (including $56.5 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 0.4% and 0.2% of our overall portfolio on a cost and fair value basis, respectively. As of September 30, 2024, the portfolio had net unrealized depreciation of $11.4 million. Our overall portfolio consisted of 158 companies with an average investment size of $12.6 million, and a weighted average yield on debt investments of 11.5%.

    For the three months ended March 31, 2025, we invested $293.3 million in three new and 54 existing portfolio companies at a weighted average yield on debt investments of 9.9%. Sales and repayments of investments for the same period totaled $122.4 million including $52.9 million of sales to PSSL. For the six months ended March 31, 2025, we invested $900.2 million in 14 new and 96 existing portfolio companies with a weighted average yield on debt investments of 10.2%. Sales and repayments of investments for the same period totaled $523.7 million, including $240.6 million of sales to PSSL.

    For the three months ended March 31, 2024, we invested $338.3 million in 11 new and 48 existing portfolio companies at a weighted average yield on debt investments of 11.6%. For the three months ended March 31, 2024, sales and repayments of investments totaled $144.8 million, including $77.2 million of sales to PSSL. For the six months ended March 31, 2024, we invested $640.9 million in 24 new and 64 existing portfolio companies at a weighted average yield on debt investments of 11.8%. For the six months ended March 31, 2024, sales and repayments of investments totaled $248.7 million, including $139.9 million of sales to PSSL.

    PennantPark Senior Secured Loan Fund I LLC

    As of March 31, 2025, PSSL’s portfolio totaled $1,060.2 million, consisted of 118 companies with an average investment size of $9.0 million and had a weighted average yield on debt investments of 10.5%. As of September 30, 2024, PSSL’s portfolio totaled $913.3 million, consisted of 109 companies with an average investment size of $8.4 million and had a weighted average yield on debt investments of 11.4%.

    For the three months ended March 31, 2025, PSSL invested $60.0 million (including $52.9 million purchase from the Company) in four new and five existing portfolio companies with a weighted average yield on debt investments of 9.8%. PSSL’s sales and repayments of investments for the same period totaled $36.8 million. For the six months ended March 31, 2025, PSSL invested $284.9 million (including $240.6 million purchased from the Company) in 21 new and 12 existing portfolio companies with a weighted average yield on debt investments of 10.2%. PSSL’s sales and repayments of investments for the same period totaled $123.4 million.

    For the three months ended March 31, 2024, PSSL invested $80.1 million (including $77.2 million purchased from the Company) in six new and four existing portfolio companies at a weighted average yield on debt investments of 11.6%. Sales and repayments of investments for the three months ended March 31, 2024 totaled $49.5 million. For the six months ended March 31, 2024, PSSL invested $155.9 million (including $139.9 million purchased from the Company) in 10 new and 11 existing portfolio companies at a weighted average yield on debt investments of 11.9%. Sales and repayments of investments for the six months ended March 31, 2024 totaled $77.2 million.

    RESULTS OF OPERATIONS

    Set forth below are the results of operations for the three and six months ended March 31, 2025 and 2024.

    Investment Income

    For the three and six months ended March 31, 2025 investment income was $61.9 million and $128.9 million, respectively, which was attributable to $56.2 million and $117.2 million from first lien secured debt and $5.7 million and $11.7 million from other investments, respectively. For the three and six months ended March 31, 2024, investment income was $44.4 million and $82.3 million, respectively, which was attributable to $39.0 million and $72.2 million from first lien secured debt and $5.4 million and $10.1 million from other investments, respectively. The increase in investment income for the three and six months ended March 31, 2025, was primarily due to the increase in the size of the debt portfolio.

    Expenses

    For the three and six months ended March 31, 2025, expenses totaled $36.9 million and $74.0 million, respectively and were comprised of: $22.5 million and $44.9 million of debt related interest and expenses, $5.6 million and $10.9 million of base management fees, $6.3 million and $13.8 million of performance-based incentive fees, $1.9 million and $3.6 million of general and administrative expenses, $0.2 million and $0.5 million of taxes and $0.4 million and $0.4 million in Credit Facility amendment costs. For the three and six months ended March 31, 2024, expenses totaled $25.3 million and $43.8 million, respectively and were comprised of: $14.7 million and $23.6 million of debt related interest and expenses, $3.4 million and $6.4 million of base management fees, $4.8 million and $9.6 million of performance-based incentive fees, $1.8 million and $3.5 million of general and administrative expenses and $0.5 million and $0.7 million of taxes. The increase in expenses for the three and six months ended March 31, 2025, was primarily due to the increase in interest expense from increased borrowings and an increase in base management fees and incentive fee as a result of the increase in our investment portfolio.

    Net Investment Income

    For the three and six months ended March 31, 2025 net investment income totaled $25.0 million or $0.28 per share, and $55.0 million or $0.64 per share, respectively. For the three and six months ended March 31, 2024, net investment income totaled $19.1 million or $0.31 per share, and $38.5 million or $0.64 per share, respectively. The increase in net investment income for the three and six months ended March 31, 2025, was primarily due to an increase in investment income partially offset by an increase in expenses.

    Net Realized Gains or Losses

    For the three and six months ended March 31, 2025 net realized gains (losses) totaled $(3.5) million and $23.1 million, respectively. For the three and six months ended March 31, 2024, net realized gains (losses) totaled $4.0 million and $0.9 million, respectively. The change in net realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.

    Unrealized Appreciation or Depreciation on Investments and Debt

    For the three and six months ended March 31, 2025 we reported net change in unrealized appreciation (depreciation) on investments of $(20.8) million and $(49.7) million, respectively. For the three and six months ended March 31, 2024, we reported net change in unrealized appreciation (depreciation) on investments of $7.7 million and $13.9 million, respectively. As of March 31, 2025 and September 30, 2024, our net unrealized appreciation (depreciation) on investments totaled $(61.2) million and $(11.4) million, respectively. The net change in unrealized appreciation (depreciation) on our investments was primarily due to the operating performance of the portfolio companies within our portfolio, changes in the capital market conditions of our investments and realization of investments.

    For the three and six months ended March 31, 2025, our Credit Facility had a net change in unrealized appreciation (depreciation) of less than $0.1 million and $0.1 million, respectively. For the three and six months ended March 31, 2024, our Credit Facility had a net change in unrealized appreciation (depreciation) of less than $0.1 million and ($0.1) million, respectively. As of March 31, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Credit Facility totaled approximately $0.1 million and zero, respectively. The net change in net unrealized (appreciation) or depreciation was primarily due to changes in the capital markets.

    Net Change in Net Assets Resulting from Operations

    For the three and six months ended March 31, 2025, net increase (decrease) in net assets resulting from operations totaled $1.2 million or $0.01 per share and $29.6 million or $0.34 per share, respectively. For the three and six months ended March 31, 2024, net increase (decrease) in net assets resulting from operations totaled $31.1 million or $0.51 per share and $53.6 million, or $0.89 per share, respectively. The net increase or (decrease) from operations for the three and six months ended March 31, 2025, was primarily due to operating performance of our portfolio and changes in capital market conditions of our investments along with change in size and cost yield of our debt portfolio and costs of financing.

    LIQUIDITY AND CAPITAL RESOURCES

    Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments, and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations.

    In February 2025 the Company, through the 2037 Securitization Issuer, completed a $474.6 million term debt securitization of which we retained $85.1 million of subordinated notes and $28.5 million of BBB-(sf) Class D Notes of the debt securitization. The weighted average credit spread is 1.59%. This 2037 Asset-Backed Debt is scheduled to mature on April 20, 2037.

    For the six months ended March 31, 2025 and 2024, the annualized weighted average cost of debt, inclusive of the fee on the undrawn commitment on the Credit Facility, amendment costs and debt issuance costs, was 6.8% and 7.1%, respectively. As of March 31, 2025 and September 30, 2024, we had $462.1 million and $192.1 million of unused borrowing capacity under the Credit Facility, respectively, subject to leverage and borrowing base restrictions.

    As of March 31, 2025 and September 30, 2024, we had cash equivalents of $111.4 million and $112.1 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to take advantage of market opportunities.

    During the three and six months ended March 31, 2025 we issued 11,562,000 shares and 18,838,000 shares of our common stock through the 2024 ATM Program, respectively at an average price of $11.34 per share and $11.35 per share raising $131.0 million and $213.2 million of net proceeds after commissions to the Sales Agents and inclusive of proceeds from the Investment Adviser to ensure that all shares were sold at or above NAV, respectively. During the three and six months ended March 31, 2024, we issued 4,493,436 shares of common stock through the 2022 ATM Program at an average price of $11.35 per share, raising $51.0 million of net proceeds after commissions to the Sales Agents and inclusive of proceeds from the Investment Adviser to ensure that all shares were sold at or above NAV, respectively.

    For the six months ended March 31, 2025, our operating activities used cash of $350.8 million and our financing activities provided cash of $350.1 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily due to borrowings under our Credit Facility, proceeds from the 2037 Asset-Backed debt and proceeds from the public offerings under our 2024 ATM Program.

    For the six months ended March 31, 2024, our operating activities used cash of $354.5 million and our financing activities provided cash of $379.2 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily due to borrowings under the Credit Facility and proceeds from the 2036 Asset-Backed debt partially offset by the repayment of the 2023 Notes.

    DISTRIBUTIONS

    During the three and six months ended March 31, 2025 we declared distributions of $0.3075 and $0.615 per share for total distributions of $27.7 million and $52.9 million, respectively. During the three and six months ended March 31, 2024, we declared distributions of $0.3075 and $0.615 per share for total distributions of $18.8 million and $36.9 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.

    RECENT DEVELOPMENTS

    In April 2025, PennantPark Floating Rate Capital Ltd. amended its credit facility agreement led by Truist Bank. As part of the amendment, the Company pricing decreased to SOFR plus 200 basis points from SOFR plus 225 basis points, the reinvestment period was extended one year to August 2028, the maturity date was extended one year to August 2030, and the maximum first lien advance rate was increased to 72.5% from 70.0%. As part of this amendment, commitments decreased from $736 million to $718 million.

    In April 2025, PSSL through its wholly-owned and consolidated subsidiary, PennantPark CLO 12, LLC closed a four year reinvestment period, twelve-year final maturity $301 million debt securitization in the form of a collateralized loan obligation. The debt in this securitization is structured in the following manner: (i) $30.0 million of Class A-1 Loans, which bear interest at three-month SOFR plus 1.45%, (ii) $141.0 million of Class A-1 Notes,which bear interest at three-month SOFR plus 1.45%, (iii) $12.0 million of Class A-2 Notes, which bear interest at a three-month SOFR plus 1.60%, (iv) $21.0 million of Class B notes, which bears interest at three-month SOFR plus 1.85%, (v) $24.0 million of Class C notes, which bears interest at three-month SOFR plus 2.30%, (vi) $18.0 million Class D notes, which bears interest at three-month SOFR plus 3.30%, (vii) $55.0 million of Sub notes. The weighted average credit spread is 1.71%. PSSL will continue to retain all of the subordinated notes through a consolidated subsidiary. The reinvestment period for the term debt securitization ends in April 2029 and the debt is scheduled to mature in April 2037. The term debt securitization is expected to be approximately 100% funded at close. The proceeds from the debt will be used to repay a portion of PSSL’s $325 million secured credit facility.

    AVAILABLE INFORMATION

    The Company makes available on its website its Quarterly Report on Form 10-Q filed with the SEC, and stockholders may find such report on its website at www.pennantpark.com.

    PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
    (in thousands, except per share data)
     
       
        March 31, 2025     September 30, 2024  
        (unaudited)        
    Assets            
    Investments at fair value            
    Non-controlled, non-affiliated investments (amortized cost— $2,043,844 and $1,622,669, respectively)   $ 2,046,762     $ 1,632,269  
    Controlled, affiliated investments (amortized cost— $361,375 and $372,271, respectively)     297,290       351,235  
    Total investments (amortized cost— $2,405,219 and $1,994,940, respectively)     2,344,052       1,983,504  
    Cash and cash equivalents (cost— $111,368 and $112,046, respectively)     111,358       112,050  
    Interest receivable     11,094       12,167  
    Receivables from investments sold     2,048        
    Distributions receivable     946       635  
    Due from affiliate     82       291  
    Prepaid expenses and other assets     2,268       198  
    Total assets     2,471,848       2,108,845  
    Liabilities            
    Credit Facility payable, at fair value (cost— $273,855 and $443,855, respectively)     273,790       443,880  
    2026 Notes payable, net (par—$185,000)     184,220       183,832  
    2036 Asset-Backed Debt, net (par—$287,000)     284,357       284,086  
    2036-R Asset-Backed Debt, net (par-$266,000)     265,300       265,235  
    2037 Asset-Backed Debt, net (par— $361,000)     358,083        
    Payable for investments purchased           20,363  
    Interest payable on debt     15,202       14,645  
    Distributions payable     9,627       7,834  
    Base management fee payable     5,604       4,588  
    Incentive fee payable     6,258       3,189  
    Accounts payable and accrued expenses     1,664       2,187  
    Deferred tax liability     612       1,712  
    Total liabilities     1,404,717       1,231,551  
    Net assets            
    Common stock, 96,417,896 and 77,579,896 shares issued and outstanding, respectively Par value $0.001 per share and 200,000,000 shares authorized     96       78  
    Paid-in capital in excess of par value     1,189,888       976,744  
    Accumulated deficit     (122,853 )     (99,528 )
    Total net assets   $ 1,067,131     $ 877,294  
    Total liabilities and net assets   $ 2,471,848     $ 2,108,845  
    Net asset value per share   $ 11.07     $ 11.31  
    PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except per share data)
    (Unaudited)
     
       
        Three Months Ended
    March 31,
        Six months Ended
    March 31,
     
        2025     2024     2025     2024  
    Investment income:                        
    From non-controlled, non-affiliated investments:                        
    Interest   $ 49,215     $ 30,470     $ 96,678     $ 54,238  
    Dividend     369       577       946       1,085  
    Other income     634       1,268       2,114       3,031  
    From controlled, affiliated investments:                        
    Interest     7,345       8,320       20,153       16,754  
    Dividend     4,375       3,719       8,750       7,219  
    Other income                 306        
    Total investment income     61,938       44,354       128,947       82,327  
    Expenses:                        
    Interest and expenses on debt     22,529       14,688       44,890       23,630  
    Performance-based incentive fee     6,258       4,767       13,750       9,630  
    Base management fee     5,604       3,424       10,868       6,375  
    General and administrative expenses     1,200       1,255       2,400       2,243  
    Administrative services expenses     650       585       1,150       1,211  
    Expenses before amendment costs and provision for taxes     36,241       24,719       73,058       43,089  
    Provision for taxes on net investment income     225       547       450       701  
    Credit Facility amendment costs     442             442        
    Total expenses     36,908       25,266       73,950       43,790  
    Net investment income     25,030       19,088       54,997       38,537  
    Realized and unrealized gain (loss) on investments and debt:                        
    Net realized gain (loss) on:                        
    Non-controlled, non-affiliated investments     (795 )     4,010       386       921  
    Non-controlled and controlled, affiliated investments     (2,682 )           22,811        
    Provision for taxes on realized gain (loss) on investments     (21 )           (94 )      
    Net realized gain (loss) on investments     (3,498 )     4,010       23,103       921  
    Net change in unrealized appreciation (depreciation) on:                        
    Non-controlled, non-affiliated investments     (9,630 )     3,278       (6,688 )     8,506  
    Controlled and non-controlled, affiliated investments     (11,146 )     4,466       (43,050 )     5,408  
    Provision for taxes on unrealized appreciation (depreciation) on investments     468       230       1,100       230  
    Debt appreciation (depreciation)     1       39       91       (23 )
    Net change in unrealized appreciation (depreciation) on investments and debt     (20,307 )     8,013       (48,547 )     14,121  
    Net realized and unrealized gain (loss) from investments and debt     (23,805 )     12,023       (25,444 )     15,042  
    Net increase (decrease) in net assets resulting from operations   $ 1,225     $ 31,111     $ 29,553     $ 53,579  
    Net increase (decrease) in net assets resulting from operations per common share   $ 0.01     $ 0.51     $ 0.34     $ 0.89  
    Net investment income per common share   $ 0.28     $ 0.31     $ 0.64     $ 0.64  

    ABOUT PENNANTPARK FLOATING RATE CAPITAL LTD.

    PennantPark Floating Rate Capital Ltd. is a business development company which primarily invests in U.S. middle-market companies in the form of floating rate senior secured loans, including first lien secured debt, second lien secured debt and subordinated debt. From time to time, the Company may also invest in equity investments. PennantPark Floating Rate Capital Ltd. is managed by PennantPark Investment Advisers, LLC.

    ABOUT PENNANTPARK INVESTMENT ADVISERS, LLC

    PennantPark Investment Advisers, LLC is a leading middle-market credit platform, managing approximately $10 billion of investable capital, including potential leverage. Since its inception in 2007, PennantPark Investment Advisers, LLC has provided investors access to middle-market credit by offering private equity firms and their portfolio companies as well as other middle-market borrowers a comprehensive range of creative and flexible financing solutions. PennantPark Investment Advisers, LLC is headquartered in Miami and has offices in New York, Chicago, Houston, Los Angeles, and Amsterdam.

    FORWARD-LOOKING STATEMENTS AND OTHER

    This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports we file under the Exchange Act. All statements other than statements of historical facts included in this press release are forward-looking statements and are not guarantees of future performance or results, and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the Securities and Exchange Commission. PennantPark Floating Rate Capital Ltd. undertakes no duty to update any forward-looking statement made herein. You should not place undue influence on such forward-looking statements as such statements speak only as of the date on which they are made.

    We may use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations.

    The information contained herein is based on current tax laws, which may change in the future. The Company cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in this material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.

    CONTACT: Richard T. Allorto, Jr.
      PennantPark Floating Rate Capital Ltd.
      (212) 905-1000
      www.pennantpark.com

    The MIL Network

  • MIL-OSI: PennantPark Investment Corporation Announces Financial Results for the Quarter Ended March 31, 2025

    Source: GlobeNewswire (MIL-OSI)

    MIAMI, May 12, 2025 (GLOBE NEWSWIRE) — PennantPark Investment Corporation (NYSE: PNNT) announced today its financial results for the second quarter ended March 31, 2025.

    HIGHLIGHTS       
    Quarter ended March 31, 2025 (unaudited)
    ($ in millions, except per share amounts)                           

    Assets and Liabilities:    
    Investment portfolio (1) $ 1,213.6  
    Net assets $ 488.1  
    GAAP net asset value per share $ 7.48  
    Quarterly change in GAAP net asset value per share   (1.2 )%
    Adjusted net asset value per share (2) $ 7.48  
    Quarterly change in adjusted net asset value per share (2)   (1.2 )%
         
    Credit Facility $ 311.4  
    2026 Notes $ 149.0  
    2026-2 Notes $ 163.5  
    Regulatory debt to equity 1.29x  
    Weighted average yield on debt investments   12.0 %
         
    Operating Results:    
    Net investment income $ 11.4  
    Net investment income per share $ 0.18  
    Core net investment income per share (3) $ 0.18  
    Distributions declared per share $ 0.24  
         
    Portfolio Activity:    
    Purchases of investments * $ 176.8  
    Sales and repayments of investments * $ 263.1  
         
    PSLF Portfolio data:    
    PSLF investment portfolio $ 1,392.9  
    Purchases of investments $ 169.9  
    Sales and repayments of investments $ 48.3  
           

    * excludes U.S. Government Securities

    1. Includes investments in PennantPark Senior Loan Fund, LLC (“PSLF”), an unconsolidated joint venture, totaling $217.7 million, at fair value.
    2. This is a non-GAAP financial measure. The Company believes that this number provides useful information to investors and management because it reflects the Company’s financial performance excluding the impact of unrealized gain on the Company’s multi-currency, senior secured revolving credit facility with Truist Bank, as amended, the “Credit Facility.” The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.
    3. Core net investment income (“Core NII”) is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company’s financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended March 31, 2025, Core NII excluded: i) $0.3 million of credit facility amendment cost, and ii) $0.1 million of incentive fee expense offset.

    CONFERENCE CALL AT 12:00 P.M. EST ON MAY 13, 2025

    PennantPark Investment Corporation (“we,” “our,” “us” or the “Company”) will also host a conference call at 12:00 p.m. (Eastern Time) on Tuesday, May 13, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (888) 394-8218 approximately 5-10 minutes prior to the call. International callers should dial (646) 828-8193. All callers should reference conference ID #1509093 or PennantPark Investment Corporation. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark’s website.

    PORTFOLIO AND INVESTMENT ACTIVITY 

    “We are pleased that our secured loan portfolio, with among the lowest portfolio company leverage and most meaningful covenants in the industry, is positioned defensively and continues to perform well,” said Art Penn, Chairman and CEO. “Additionally, our dividend stream is supported by substantial spillover income as we look to rotate equity investments over time.”

    As of March 31, 2025, our portfolio totaled $1,213.6 million and consisted of $503.0 million or 41% of first lien secured debt, $124.6 million or 10% of U.S. Government Securities, $17.9 million or 2% of second lien secured debt, $216.8 million or 18% of subordinated debt (including $140.3 million or 12% in PSLF) and $351.3 million or 29% of preferred and common equity (including $77.4 million or 6% in PSLF). Our interest bearing debt portfolio consisted of 91% variable-rate investments and 9% fixed-rate investments. As of March 31, 2025, we had three portfolio companies on non-accrual, representing 1.6% and 0.4% percent of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $40.7 million as of March 31, 2025. Our overall portfolio consisted of 158 companies with an average investment size of $6.9 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.0%.

    As of September 30, 2024, our portfolio totaled $1,328.1 million and consisted of $667.9 million or 50% of first lien secured debt, $99.6 million or 8% of U.S. Government Securities, $67.2 million or 5% of second lien secured debt, $181.7 million or 14% of subordinated debt (including $115.9 million or 9% in PSLF) and $311.7 million or 23% of preferred and common equity (including $67.9 million or 5% in PSLF). Our interest bearing debt portfolio consisted of 94% variable-rate investments and 6% fixed-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 4.1% and 2.3% of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $11.2 million as of September 30, 2024. Our overall portfolio consisted of 152 companies with an average investment size of $8.1 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.3%.

    For the three months ended March 31, 2025, we invested $176.8 million in three new and 52 existing portfolio companies with a weighted average yield on debt investments of 10.7% (excluding U.S. Government Securities). For the three months ended March 31, 2025, sales and repayments of investments totaled $263.1 million (including $154.4 million was sold to PSLF) which excludes U.S. Government Securities. For the six months ended March 31, 2025, we invested $472.5 million in 15 new and 96 existing portfolio companies with a weighted average yield on debt investments of 10.6% (excluding U.S. Government Securities). For the six months ended March 31, 2025, sales and repayments of investments totaled $616.8 million (including $441.0 million was sold to PSLF) which excludes U.S. Government Securities.

    For the three months ended March 31, 2024, we invested $188.5 million in six new and 43 existing portfolio companies with a weighted average yield on debt investments of 11.7% (excluding U.S. Government Securities). For the three months ended March 31, 2024, sales and repayments of investments totaled $176.2 million (including $103.1 million was sold to PSLF) which excludes U.S. Government Securities. For the six months ended March 31, 2024, we invested $419.6 million in 18 new and 60 existing portfolio companies with a weighted average yield on debt investments of 11.8% (excluding U.S. Government Securities). For the six months ended March 31, 2024, sales and repayments of investments totaled $247.2 million (including $154.0 million was sold to PSLF) which excludes U.S. Government Securities.
      
    PennantPark Senior Loan Fund, LLC

    As of March 31, 2025, PSLF’s portfolio totaled $1,392.9 million, consisted of 119 companies with an average investment size of $11.7 million and had a weighted average yield interest bearing debt investments of 10.4%.

    As of September 30, 2024, PSLF’s portfolio totaled $1,031.2 million, consisted of 102 companies with an average investment size of $10.1 million and had a weighted average yield interest bearing debt investments of 11.3%.

    For the three months ended March 31, 2025, PSLF invested $169.9 million (including $154.4 million were purchased from the Company) in eight new and 14 existing portfolio companies at weighted average yield interest bearing debt investments of 10.1%. PSLF’s sales and repayments of investments for the same period totaled $48.3 million. For the six months ended March 31, 2025, PSLF invested $523.7 million (including $441.0 million were purchased from the Company) in 23 new and 57 existing portfolio companies at weighted average yield interest bearing debt investments of 10.4%. PSLF’s sales and repayments of investments for the same period totaled $157.4 million.

    For the three months ended March 31, 2024, PSLF invested $113.2 million (including $103.1 million were purchased from the Company) in 11 new and five existing portfolio companies at weighted average yield on interest bearing debt investments of 11.8%. PSLF’s sales and repayments of investments for the same period totaled $49.7 million. For the six months ended March 31, 2024, PSLF invested $194.2 million (including $154.0 million were purchased from the Company) in 16 new and 11 existing portfolio companies at weighted average yield on interest bearing debt investments of 12.2%. PSLF’s sales and repayments of investments for the same period totaled $78.9 million.

    RESULTS OF OPERATIONS

    Set forth below are the results of operations for the three and six months ended March 31, 2025 and 2024.

    Investment Income

    For the three and six months ended March 31, 2025, investment income was $30.7 million and $64.9 million, respectively, which was attributable to $22.1 million and $47.3 million from first lien secured debt, $1.0 million and $3.0 million from second lien secured debt, $1.1 million and $2.2 million from subordinated debt and $6.5 million and $12.4 million from other investments, respectively. For the three and six months ended March 31, 2024, investment income was $36.0 million and $70.3 million, respectively, which was attributable to $27.8 million and $52.9 million from first lien secured debt, $2.8 million and $5.4 million from second lien secured debt, $0.1 million and $1.4 million from subordinated debt and $5.3 million and $10.6 million from preferred and common equity, respectively. The decrease in investment income for three and six months ended March 31, 2025, was primarily due to a decrease in our total portfolio size and a decrease in our weighted average yield on debt investments.

    Expenses

    For the three and six months ended March 31, 2025, expenses totaled $19.2 million and $40.4 million, respectively, and were comprised of $10.6 million and $22.4 million of debt related interest and expenses, $4.0 million and $8.3 million of base management fees, $2.4 million and $5.2 million of incentive fees, $1.6 million and $3.3 million of general and administrative expenses and $0.6 million and $1.3 million of provision for excise taxes, respectively. For the three and six months ended March 31, 2024, expenses totaled $21.7 million and $40.4 million, respectively, and were comprised of; $11.9 million and $21.4 million of debt-related interest and expenses, $4.1 million and $8.1 million of base management fees, $3.0 million and $6.3 million of incentive fees, $1.9 million and $3.3 million of general and administrative expenses and $0.8 million and $1.2 million of provision for excise taxes, respectively. The decrease in expenses for the three months ended March 31, 2025, was primarily due to decreases in interest and expenses on debt and incentive fees. Total expenses were flat for the six months ended March 31, 2025.

    Net Investment Income

    For the three and six months ended March 31, 2025, net investment income totaled $11.4 million and $24.4 million, or $0.18 per share and $0.37 per share, respectively. For the three and six months ended March 31, 2024, net investment income totaled $14.3 million and $29.9 million, or $0.22 per share and $0.46 per share, respectively. The decrease in net investment income was primarily due to a decrease in investment income and partially offset by a decrease in expenses.

    Net Realized Gains or Losses

    For the three and six months ended March 31, 2025, net realized gains (losses) totaled $(27.7) million and $(30.3) million, respectively. For the three and six months ended March 31, 2024, net realized gains (losses) totaled $(31.0) million and $(29.2) million, respectively. The change in realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.

    Unrealized Appreciation or Depreciation on Investments and Debt

    For the three and six months ended March 31, 2025, we reported net change in unrealized appreciation (depreciation) on investments of $27.1 million and $29.5 million, respectively. For the three and six months ended March 31, 2024, we reported net change in unrealized appreciation (depreciation) on investments of $33.2 million and $28.3 million, respectively. As of March 31, 2025 and September 30, 2024, our net unrealized appreciation (depreciation) on investments totaled $40.7 million and $11.2 million, respectively. The net change in unrealized depreciation on our investments was primarily due to changes in the capital market conditions of our investments and the values at which they were realized.

    For the three and six months ended March 31, 2025, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $(1.4) million and $1.9 million, respectively. For the three and six months ended March 31, 2024, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $0.5 million and $(1.6) million, respectively. As of March 31, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Truist Credit Facility totaled $3.0 million and $1.1 million, respectively. The net change in unrealized depreciation compared to the same periods in the prior period was primarily due to changes in the capital markets.

    Net Change in Net Assets Resulting from Operations

    For the three and six months ended March 31, 2025, net increase (decrease) in net assets resulting from operations totaled $9.5 million and $25.5 million or $0.14 per share and $0.39 per share, respectively. For the three and six months ended March 31, 2024, net increase (decrease) in net assets resulting from operations totaled $16.1 million and $26.7 million or $0.25 per share and $0.41 per share, respectively. The change in net assets from operations for the six months ended March 31, 2025 was primarily due to a change in the net realized and unrealized depreciation in the portfolio primarily driven by changes in market conditions and decrease in net investment income.

    LIQUIDITY AND CAPITAL RESOURCES

    Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of interest expense, fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from the rotation of our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations.

    As of March 31, 2025 and September 30, 2024, we had $314.5 million and $461.5 million, respectively, in outstanding borrowings under the Truist Credit Facility. The Truist Credit Facility had a weighted average interest rate of 6.7% and 7.2%, respectively, exclusive of the fee on undrawn commitment.  As of March 31, 2025 and September 30, 2024, we had $185.5 million and $13.5 million of unused borrowing capacity under the Truist Credit Facility, respectively, subject to leverage and borrowing base restrictions.

    As of March 31, 2025 and September 30, 2024, we had cash and cash equivalents of $32.6 million and $49.9 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to allows us to effectively operate our business.

    For the six months ended March 31, 2025, our operating activities provided cash of $161.1 million and our financing activities used cash of $178.3 million. Our operating activities provided cash primarily due to our investment activities and our financing activities used cash primarily for repayments of our credit facility and distributions paid to stockholders.

    For the six months ended March 31, 2024, our operating activities used cash of $150.9 million and our financing activities provided cash of $147.5 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily from borrowings under the Truist Credit Facility.

    DISTRIBUTIONS

    During the three and six months ended March 31, 2025, we declared distributions of $0.24 and $0.48 per share, for total distributions of $15.7 million and $31.3 million, respectively. During the three and six months ended March 31, 2024, we declared distributions of $0.21 and $0.42 per share, for total distributions of $13.7 million and $27.4 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.

    AVAILABLE INFORMATION

    The Company makes available on its website its Quarterly Report on Form 10-Q filed with the SEC and stockholders may find the report on our website at www.pennantpark.com.

    PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
    (In thousands, except share data)
     
      March 31, 2025     September 30, 2024  
      (unaudited)        
    Assets          
    Investments at fair value          
    Non-controlled, non-affiliated investments (amortized cost—$716,505 and $916,168, respectively) $ 723,808     $ 910,323  
    Non-controlled, affiliated investments (amortized cost—$58,068 and $56,734, respectively)   11,050       33,423  
    Controlled, affiliated investments (amortized cost—$398,359 and $343,970, respectively)   478,752       384,304  
    Total investments (amortized cost—$1,172,932 and $1,316,872, respectively)   1,213,610       1,328,050  
    Cash and cash equivalents (cost—$32,568 and $49,833, respectively)   32,587       49,861  
    Interest receivable   5,322       5,261  
    Distribution receivable   6,040       5,417  
    Due from affiliates   35       228  
    Prepaid expenses and other assets   185       269  
    Total assets   1,257,779       1,389,086  
    Liabilities          
    Truist Credit Facility payable, at fair value (cost—$314,456 and $461,456, respectively)   311,412       460,361  
    2026 Notes payable, net (par— $150,000)   149,022       148,571  
    2026 Notes-2 payable, net (par— $165,000)   163,506       163,080  
    Payable for investment purchased   124,609       100,096  
    Interest payable on debt   6,349       6,406  
    Distributions payable   5,224       5,224  
    Base management fee payable   4,017       4,297  
    Accounts payable and accrued expenses   3,108       4,053  
    Incentive fee payable   2,425       3,057  
    Due to affiliate   1       33  
    Total liabilities   769,673       895,178  
    Commitments and contingencies          
    Net assets          
    Common stock, 65,296,094 and 65,296,094 shares issued and outstanding, respectively              
    Par value $0.001 per share and 200,000,000 shares authorized   65       65  
    Paid-in capital in excess of par value   743,968       743,968  
    Accumulated deficit   (255,927 )     (250,125 )
    Total net assets $ 488,106     $ 493,908  
    Total liabilities and net assets $ 1,257,779     $ 1,389,086  
    Net asset value per share $ 7.48     $ 7.56  
                   
    PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (In thousands, except share data)
    (Unaudited)
     
      Three Months Ended March 31,     Six Months Ended March 31,  
      2025     2024     2025     2024  
    Investment income:                      
    From non-controlled, non-affiliated investments:                      
    Interest $ 14,987     $ 22,904     $ 33,753     $ 43,972  
    Payment-in-kind   1,564       187       2,985       189  
    Dividend income   499       623       1,006       1,315  
    Other income   120       778       702       2,203  
    From non-controlled, affiliated investments:                      
    Payment-in-kind                     347  
    From controlled, affiliated investments:                      
    Interest   7,887       5,941       15,142       11,422  
    Payment-in-kind         857       823       1,489  
    Dividend income   5,579       4,689       10,430       9,378  
    Other income   27             27        
    Total investment income   30,663       35,979       64,868       70,315  
    Expenses:                      
    Interest and expenses on debt   10,318       11,868       22,058       21,424  
    Base management fee   4,017       4,137       8,285       8,141  
    Incentive fee   2,425       3,018       5,180       6,339  
    General and administrative expenses   1,150       1,379       2,400       2,593  
    Administrative services expenses   450       550       950       739  
    Expenses before amendment costs, debt issuance costs and provision for taxes   18,360       20,952       38,873       39,236  
    Provision for taxes on net investment income   550       775       1,250       1,168  
    Credit facility amendment and debt issuance costs   324             324        
    Net expenses   19,234       21,727       40,447       40,404  
    Net investment income   11,429       14,252       24,421       29,911  
    Realized and unrealized gain (loss) on investments and debt:                      
    Net realized gain (loss) on investments and debt:                      
    Non-controlled, non-affiliated investments   (27,714 )     (1,434 )     (30,274 )     1,146  
    Non-controlled and controlled, affiliated investments         (29,419 )           (30,169 )
    Provision for taxes on realized gain on investments   (49 )     (177 )     (49 )     (177 )
    Net realized gain (loss) on investments and debt   (27,763 )     (31,030 )     (30,323 )     (29,200 )
    Net change in unrealized appreciation (depreciation) on:                      
    Non-controlled, non-affiliated investments   17,918       (1,528 )     13,141       (13,798 )
    Non-controlled and controlled, affiliated investments   9,214       34,751       16,352       42,075  
    Provision for taxes on unrealized appreciation (depreciation) on investments   37       (830 )           (680 )
    Debt appreciation (depreciation)   (1,379 )     470       1,949       (1,570 )
    Net change in unrealized appreciation (depreciation) on investments and debt   25,790       32,863       31,442       26,027  
    Net realized and unrealized gain (loss) from investments and debt   (1,973 )     1,833       1,119       (3,173 )
    Net increase (decrease) in net assets resulting from operations $ 9,456     $ 16,085     $ 25,540     $ 26,738  
    Net increase (decrease) in net assets resulting from operations per common share $ 0.14     $ 0.25     $ 0.39     $ 0.41  
    Net investment income per common share $ 0.18     $ 0.22     $ 0.37     $ 0.46  
                                   

    ABOUT PENNANTPARK INVESTMENT CORPORATION

    PennantPark Investment Corporation, or the Company, is a business development company that invests primarily in U.S. middle-market companies in the form of first lien secured debt, second lien secured debt, subordinated debt and equity investments. PennantPark Investment Corporation is managed by PennantPark Investment Advisers, LLC.

    ABOUT PENNANTPARK INVESTMENT ADVISERS, LLC

    PennantPark Investment Advisers, LLC is a leading middle market credit platform, managing approximately $10 billion of investable capital, including available leverage. Since its inception in 2007, PennantPark Investment Advisers, LLC has provided investors access to middle market credit by offering private equity firms and their portfolio companies as well as other middle-market borrowers a comprehensive range of creative and flexible financing solutions. PennantPark Investment Advisers, LLC is headquartered in Miami and has offices in New York, Chicago, Houston, Los Angeles, and Amsterdam.

    FORWARD-LOOKING STATEMENTS

    This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports PennantPark Investment Corporation files under the Exchange Act. All statements other than statements of historical facts included in this press release are forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the SEC. PennantPark Investment Corporation undertakes no duty to update any forward-looking statement made herein. You should not place undue influence on such forward-looking statements as such statements speak only as of the date on which they are made.

    We may use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations.

    The information contained herein is based on current tax laws, which may change in the future. The Company cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in this material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.

    Contact: Richard T. Allorto, Jr.
      PennantPark Investment Corporation
      (212) 905-1000
      www.pennantpark.com

    The MIL Network

  • MIL-OSI Economics: Commemoration of the Customs Valuation Agreement at 30 WTO Committee on Customs Valuation

    Source: World Trade Organization

    Distinguished delegates, ladies and gentlemen,

    It is a pleasure to address you today to celebrate the 30th anniversary of the Customs Valuation Agreement, as well as the Committee on Customs Valuation overseeing the Agreement’s implementation.

    While 2025 marks the 30th anniversary of the Agreement, its origins trace back to the GATT era, when it was called the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994.

    Its long history demonstrates the importance of customs valuation, and its particular relevance in today’s environment when there is so much focus on tariffs. Customs valuation is a threshold question that importers must address because it can dramatically change the effect of tariffs. How customs value goods can be just as important as the tariff rate applicable to that good because the customs value and the tariff rate together determine the amount of duty the importer must pay. A low tariff with high customs valuation can hurt as much as a high tariff.

    This interrelationship shows that the WTO rules are more than about tariff levels – our rules benefit all Members by establishing how value is measured for purposes of applying tariffs. Inconsistent valuation methods created uncertainty and unpredictability for traders. Without these rules, Members cannot predict how much they would collect in tariffs and how much their exporters would pay abroad.

    Just consider what happened before the Agreement was negotiated. Article VII of the GATT, which first regulated customs valuation in 1947, set out broad principles for national customs valuation systems but allowed countries considerable flexibility to implement their own national systems. In practice, this flexibility led to wide variation and a lack of transparency across customs administrations.

    By the time of the Tokyo Round, these challenges had become so significant that customs valuation practices were increasingly considered to be non-tariff barriers to trade, prompting the international community to seek stronger, more harmonized rules.

    The Tokyo Round resulted in the conclusion in 1979 of the GATT Valuation Code, which provided for the first time a detailed regulation of customs valuation aimed at establishing a fair, uniform, and neutral system that reflected commercial realities and prohibited the use of arbitrary or fictitious customs values.

    The WTO Customs Valuation Agreement we are commemorating today is in essence that Valuation Code with two key advancements:

    • First, it strengthened the plurilateral GATT Valuation Code into a multilateral agreement, and therefore all WTO Members are obliged to comply; and
    • Second, it ensures that the market access opportunities achieved through rounds of tariff reductions are not eroded as a result of arbitrary, fictitious or non-transparent valuation methodologies. 

    In so doing, the Customs Valuation Agreement was a forward-looking agreement for its time. Let me highlight two aspects that illustrate its progressive nature.  

    • First, the Agreement recognizes the importance of a constructive relationship between customs authorities and the private sector. It is premised on an idea that an informed and committed private sector is more likely to comply voluntarily. This partnership-based approach was a significant shift at the time, particularly given the importance for governments to maintain control over revenue fraud.
    • Second, the Agreement introduced market-oriented and trade facilitating practices to customs valuation. For example, it established the transaction value – i.e., the price actually paid or payable – as the basis for customs valuation. This approach reflected market conditions more accurately than other valuation methods by ensuring that the customs value of goods is based on the true value of goods negotiated between buyer and seller.

    The Customs Valuation Agreement serves also as a trade facilitating tool. Given the inherent complexity of customs valuation, by providing a uniform set of rules for valuing goods, it leads to greater predictability and consistency in the treatment of goods at the border. This standardization helps minimize costs and delays for developed and developing Members alike by enabling traders to understand, in advance, how their goods will be valued.  

    Nevertheless, the implementation of the Customs Valuation Agreement is not without challenges. For some Members, customs duties remain a significant source of government revenue; others operate under trade policy frameworks that include high tariffs or face the realities of large informal trading sectors. In some cases, customs administrations also contend with limited resources, which can impede full and effective implementation of the Agreement.

    The Committee has shown its commitment to supporting implementation efforts by Members. This activity includes targeted initiatives, such as the 2002 seminar on mobilizing technical assistance and, more recently, the 2019 workshop organized in collaboration with the Trade Facilitation Agreement Facility to address implementation challenges and explore how the TFA can reinforce CVA implementation.

    Just last year, the Committee brought renewed attention to one of the fundamental aspects of the Customs Valuation Agreement and the WTO more broadly – transparency.  Your efforts to strengthen the notification process have yielded tangible results, leading to the strongest year in recent memory for notification submissions. This is a commendable achievement. Transparency through timely notifications is essential – not only for the effective operation of the CVA, but also for the credibility and functioning of the WTO as a whole. I encourage you to continue this important work. Thirty years on, notification remains a cornerstone of successful implementation.

    Your Committee stands as a reminder that WTO Agreements cannot operate in a silo nor in a vacuum. Let me give you an example. As you know, this Committee also oversees the Preshipment Inspection Agreement. Historically, the CVA was strongly linked to the Preshipment Inspection Agreement because some governments relied on preshipment inspection entities to carry out customs valuation-related activities.  However, since the entry into force of the Trade Facilitation Agreement in 2017, which prohibits the use of preshipment inspections for customs valuation, this linkage has naturally diminished. At the same time, a growing alignment between the Customs Valuation Agreement and the Trade Facilitation Agreement has emerged. These two Agreements now reinforce each other in promoting transparency, efficiency, and predictability at the border.

    Over the past 30 years, the Customs Valuation Agreement has proven to be flexible and successful at adapting to a changing environment by requiring that customs value be based on simple and equitable criteria consistent with commercial practices. But today, we are entering a new phase – one marked by rapid, transformative change. Digitalization, artificial intelligence, and evolving trade dynamics will challenge us to interpret and apply the CVA in new and complex ways.  

    It is up to you as Members of the Committee on Customs Valuation to collectively ensure uniformity in interpretation and application of the Agreement in this volatile trading environment and constantly evolving business models. In this effort, our continued partnership with the World Customs Organization Technical Committee on Customs Valuation will continue to be indispensable. I am pleased that we are joined today by the Chairperson of this Committee, whose presence reflects the strength of that collaboration.

    As we mark 30 years of this Agreement, I wish to thank all our delegates, as well as the Secretariat team, for the dedication and professionalism that has sustained its implementation. I am confident that, through your continued engagement, this Committee will remain a cornerstone of the multilateral trading system – resilient, effective, and ready to address the challenges we are facing.

    Thank you.

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    MIL OSI Economics

  • MIL-OSI Economics: Members note benefits, challenges for Customs Valuation Agreement at anniversary event

    Source: World Trade Organization

    “In today’s complex and tariff-sensitive trading environment, the Customs Valuation Agreement is more critical than ever,” she said. “The way a product is valued at the border can be just as important as the tariff rate itself. Even a low tariff can result in significant duties if the customs value is high. That is why the CVA – by providing transparent and uniform rules – plays a foundational role in ensuring predictability for traders and stability for all members,” she said. “This standardization helps minimize costs and delays for developed and developing members alike by enabling traders to understand, in advance, how their goods will be valued,” she emphasized.

    DDG Ellard underscored the Agreement’s forward-looking design, noting its introduction of market-based valuation principles and its emphasis on collaboration between customs authorities and the private sector. These features have become increasingly relevant in light of current challenges, such as digital trade, artificial intelligence and rapidly evolving global supply chains.

    Looking forward, DDG Ellard acknowledged the new phase of challenges posed by rapid technological advancements. Digitalization, artificial intelligence and evolving trade dynamics require innovative interpretations and applications of the CVA. Customs administrations must adapt to these changes to ensure uniformity in the Agreement’s implementation amidst a volatile trading environment.

    DDG Ellard called on the Committee to continue working with the World Customs Organization (WCO) Technical Committee on Customs Valuation, a partnership she said is indispensable for addressing the complexities introduced by digital trade and ensuring the CVA remains resilient and effective. DDG Ellard’s full remarks are available here.

    The Committee also heard from a number of Customs experts. Santa Marianela Marte De Los Santos of the Dominican Republic noted that implementation of the CVA in her country has led to reduced time and costs for goods to clear customs.

    Omar Cisse, an official from Senegal, underlined the importance of the Committee’s work on transparency while Lin Qianyu, Chairperson of the WCO Technical Committee on Customs Valuation, provided an overview of the  Technical Committee’s work over the past 30 years and its close cooperation with theCVA. Kelly Morgero of the Federal Revenue Office of Brazil shared with members Brazil’s most recent customs valuation-related developments. 

    “I believe that our exchanges have provided us with a very valuable opportunity to highlight, and hopefully, learn from the various experiences of 30 years of implementing the Customs Valuation Agreement,” the Chair of the Committee, Sergio Prieto López (Spain), said in wrapping up the anniversary event.

    Committee regular work

    At the Committee meeting, the Chair updated members on the current notification status regarding customs valuation legislation. Under Article 22 of the Customs Valuation Agreement and the Decision on “Notification and circulation of national legislation in accordance with Article 22 of the Agreement”, members must submit the complete texts of their national legislation on customs valuation in one of the three official WTO languages. They should also inform the Committee of any changes in their laws and regulations relevant to this Agreement and in the administration of such laws and regulations.

    Following the consideration of 34 specific notifications at the Committee meeting, the Chair noted that to date 119 members have notified their national legislation on customs valuation and 92 members have provided responses to a checklist of issues.

    The Chair welcomed eight new notifications that resulted directly from the Customs Valuation Workshop on notifications organized by the Secretariat in May 2024 to assist developing and least-developed members with notifications.

    The Chair also brought to the Committee’s attention a new WTO Secretariat report, “Notifications Status of Regular/Periodic and One Time Only Notifications in the Goods Area (1995-2024) (G/C/W/859)”. 

    The results from the report indicate that there is room for improvement with regard to the rate of customs valuation notifications, the Chair said. The rate of notifications under CVA Article 22. 1 – which are notifications of any changes in a member’s laws and regulations relevant to the Agreement – stood at 85.4% for 1995-2024. However, the report also shows that three CVA notification categories are among the five notification requirements with the lowest submission rates for one-time only notifications.  These three categories are the Carrier Media Decision of the Committee on Customs Valuation with a rate of 47.4%, the Decision on Interest Charges of the Committee on Customs Valuation with a rate of 49.6% and the “Checklist of Issues” with a rate of 65.7%.

    “This new report could provide an opportunity for the Committee to address the issue of outstanding notifications and to try to identify a means by which members can be assisted in fulfilling their notification requirements in a timely manner,” the Chair said.

    Next meeting

    The next meeting of the Committee is scheduled for 10 November 2025.

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    MIL OSI Economics

  • MIL-OSI USA: Presidential Message on the National Charter Schools Week, 2025

    US Senate News:

    Source: The White House
    From the earliest days of our Republic, great schools and teachers have fortified the American mind and emboldened generations of students to achieve the American Dream.  This National Charter Schools Week, my Administration renews its commitment to defend American charter schools, advance school choice, and protect the sacred right of every parent to be the steward of their children’s education. Since the first American public charter school opened in 1992, charter schools have provided children—especially those in low-income and urban areas—with the opportunity to grow, succeed, and fulfill their God-given potential, regardless of their zip code or financial situation.  Today, there are more than 8,000 operational charter schools in America empowering parents to pursue the right educational fit for their children.  Charter school students are outperforming their peers in math and reading—and in the overwhelming majority of states, charter school enrollment growth is exceeding school-aged population growth. As President, I am steadfastly committed to promoting choice, opportunity, and innovation in American classrooms.  Since taking office, I proudly signed an Executive Order to expand educational freedom and opportunity for families.  It is the official policy of my Administration that parents have the fundamental right to oversee the education, upbringing, and moral formation of their children. Last month, I also took action to create new educational and workforce development opportunities for our Nation’s youth in the realm of artificial intelligence, so that our children will be equipped with the skills they need to be leaders in the digital age.  Additionally, I signed an order directing the Secretary of Education to take all necessary steps to facilitate the closure of the Department of Education—handing education authority back to the States, where it belongs.  America’s schools should be shining examples to the rest of the world, and my Administration will never waver in its commitment to empowering parents and renewing safety, security, and sanity in our classrooms.  This National Charter Schools Week, we celebrate the tremendous accomplishments of charter school students, parents, teachers, and advocates.  We renew our pledge to support freedom in education in all its forms, whether through homeschooling or charter, public, or religious schools.  Above all, we remember that great schools are the gateway to a great, hopeful, and prosperous American future.

    MIL OSI USA News

  • MIL-OSI USA: Governor Newsom releases state model for cities and counties to immediately address encampments with urgency and dignity

    Source: US State of California 2

    May 12, 2025

    What you need to know: Governor Newsom today released a model ordinance for cities and counties to immediately address dangerous and unhealthy encampments and connect people experiencing homelessness with shelter and services. Backed in part by $3.3 billion in new Prop 1 funding being announced today, the Governor is calling on all local governments to act without delay and use their authority affirmed by the U.S. Supreme Court to address encampments.

    SACRAMENTO —  As part of California’s ambitious push to tackle the nationwide homelessness crisis head-on, Governor Gavin Newsom released a model ordinance for cities and counties to address unhealthy and dangerous encampments. The Governor is calling on every local government to adopt and implement local policies without delay, backed by billions in state funding and authority affirmed by the U.S. Supreme Court last year. The model ordinance follows and builds on the Governor’s 2024 executive order, which urged all local jurisdictions to quickly address encampments and use state and local funding to connect people experiencing homelessness with the care and support they need.

    This announcement is coupled with the release of $3.3 billion in voter-approved Proposition 1 funding, which will be made available later today to communities statewide to expand behavioral health housing and treatment options for the most seriously ill and homeless in California.

    “There’s nothing compassionate about letting people die on the streets. Local leaders asked for resources — we delivered the largest state investment in history. They asked for legal clarity — the courts delivered. Now, we’re giving them a model they can put to work immediately, with urgency and with humanity, to resolve encampments and connect people to shelter, housing, and care. The time for inaction is over. There are no more excuses.”

    Governor Gavin Newsom

    Giving locals the tools they need

    Governor Newsom has been a fierce advocate for people experiencing homelessness, creating new resources to support local governments to help provide support and care. The Newsom administration has provided local communities with more than $27 billion to address homelessness, created stronger accountability laws and tools to ensure that every community is doing its part.

    Today, Governor Newsom is continuing the state’s support by sharing with local communities a model ordinance to help local governments set appropriate rules around encampments and establish effective enforcement procedures that prioritize notice, shelter, and services.  Encampments pose a serious public safety risk, and expose the people in encampments to increased risk of sexual violence, criminal activity, property damage and break-ins, and unsanitary conditions. 

    Clear formal guidelines for clearing encampments 

    The state’s model ordinance will be provided to every community as a starting point so jurisdictions can create their own policies.  It draws from the state’s proven and workable approach — an approach that, since July 2021, has cleared more than 16,000 encampments and over 311,873 cubic yards of waste and debris from sites along the state right of way. These results demonstrate that the policy is effective and scalable, offering a sound, adoptable framework for jurisdictions to resolve encampments with urgency and dignity.

    The ordinance contains key provisions, which may be modified based on local need, including:

    • A prohibition on persistent camping in one location
    • A prohibition on encampments that block free passage on sidewalks
    • A requirement that local officials provide notice and make every reasonable effort to identify and offer shelter prior to clearing an encampment

    The ordinance helps ensure that local communities take a balanced approach to address and prevent encampments with compassion and care. 

    The ordinance reflects the guidance for local governments created following the Governor’s Executive Order, requiring at least 48 hours’ notice, outreach to local service providers, and proper storage of items when addressing encampments.

    Learn about your community’s progress

    Visit accountability.ca.gov, which brings together thousands of locally reported data points to provide an accurate picture of local communities’ work to address homelessness, create housing, and create behavioral health supports.  The new accountability tool helps Californians quickly and clearly assess the progress being made by their local governments on these pressing issues and learn more about the process and funding provided to communities by the state.

    Reversing decades of inaction 

    The Newsom Administration is making significant progress in reversing decades of inaction on homelessness. Between 2014 and 2019, unsheltered homelessness in California increased by approximately 37,000 people, more than double the increase seen during the Newsom Administration.

    As states throughout the nation continue to see ever-higher increases in homeless populations, California has dramatically slowed the growth in homelessness and reduced the number of veterans and youth experiencing homelessness — more than any other state.

    Homelessness continues to increase nationwide, increasing in 2024 by more than 18%, but California is bucking the national trend by holding the statewide increase to 3%. This is a lower rate than in 40 other states.

    California is also one of the few states that have dramatically blunted the increases in unsheltered homelessness, holding it to 0.45%. By comparison, in 2024, nationwide unsheltered homelessness grew by nearly 7%. Unsheltered homelessness growth in other large population states like Illinois, Florida, New York, and Texas surpassed California’s percentage and number. California experienced the largest decrease in veteran homelessness in the nation last year.

    Recent news

    News Sacramento, California – Governor Gavin Newsom today issued a proclamation declaring May 2025 as “Older Californians Month.”The text of the proclamation and a copy can be found below: PROCLAMATIONCalifornia is home to nearly nine million older residents who…

    News What you need to know: Ahead of peak wildfire season, California has launched “Ask CAL FIRE,” an AI-powered chatbot on CAL FIRE’s website offering wildfire resources and emergency information in 70 languages. SACRAMENTO — As California marks Wildfire Preparedness…

    News What you need to know: Governor Newsom has been appointed co-chair of the U.S. Climate Alliance – a bipartisan coalition of 24 governors working to achieve a net-zero carbon pollution future in America by advancing state-led, high-impact climate action….

    MIL OSI USA News

  • MIL-OSI Europe: Text adopted – Discharge 2023: EU general budget – Court of Justice of the European Union – P10_TA(2025)0080 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to its decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2023, Section IV – Court of Justice of the European Union,

    –  having regard to Rule 102 of and Annex V to its Rules of Procedure,

    –  having regard to the opinion of the Committee on Legal Affairs,

    –  having regard to the report of the Committee on Budgetary Control (A10-0050/2025),

    A.  whereas in the context of the discharge procedure, the discharge authority wishes to stress the particular importance of further strengthening the democratic legitimacy of the Union institutions by improving transparency and accountability, and by implementing the concept of performance-based budgeting and good governance of human resources;

    B.  whereas the Court of Justice of the European Union (CJEU) is the judicial institution of the Union, having the task of ensuring compliance with Union law by overseeing the uniform interpretation and application of the Treaties and ensuring the lawfulness of measures adopted by the Union institutions, bodies, offices and agencies;

    C.  whereas the CJEU helps preserving the values of the Union and, through its case-law, works towards the building of Europe;

    D.  whereas the CJEU comprises two courts: the Court of Justice and the General Court;

    E.  whereas Parliament and Council amended Protocol No 3 on the Statute of the CJEU (the ‘Statute’)(1) in 2024 with respect to the transfer of preliminary rulings in specific areas to the jurisdiction of the General Court;

    1.  Notes that the budget of the CJEU falls under MFF heading 7, ‘European public administration’, which amounted to EUR 12,3 billion in 2023 (representing 6,4 % of the total Union budget); notes that the CJEU’s budget of approximately EUR 0,5 billion represents approximately 3,9 % of the total administrative expenditure of the Union;

    2.  Notes that the Court of Auditors (the ‘Court’), in its Annual Report for the financial year 2023 (the ‘Court’s report’) examined a sample of 70 transactions under the heading ‘Administration’, 10 more than were examined in 2022; the Court further states that administrative expenditure comprises expenditure on human resources, including expenditure on pensions, which in 2023 accounted for approximately 70 % of the total administrative expenditure, and expenditure on buildings, equipment, energy, communications and information technology (IT), and that its work over many years indicates that, overall, this spending is low risk;

    3.  Notes that 21 (30 %) of the 70 transactions contained errors but that the Court, based on the five errors which were quantified, estimates the level of error to be below the materiality threshold;

    4.  Notes that the Court’s report did not identify any specific issues concerning the CJEU;

    Budgetary and financial management

    5.  Notes that the budget allocated for the CJEU in 2023 amounted to EUR 486 025 796, which represented an increase of 3,9 % compared to 2022; notes that this increase was mainly related to salary adjustments forecasted for 2023; stresses that the budget of the CJEU is essentially administrative, with around 75 % of the appropriations related to expenditure for its members and staff, and almost all of the rest related to expenditure for buildings and IT;

    6.  Notes that the overall implementation rate of the budget at the end of 2023 was 97,72 %; notes that five transfers were submitted to the budgetary authority in accordance with Article 29 of the Financial Regulation to reinforce the budget lines for ‘Energy consumption’, ‘Purchases, work, servicing and maintenance of equipment and software’ and ‘buildings’ from other budget lines, mainly the budget line for staff ‘Remuneration and allowances’; notes that Russia’s war of aggression against Ukraine continued to create budgetary pressure for the CJEU, including through rising inflation and salary adjustments, strongly increasing energy costs and costs for a number of goods and services;

    7.  Notes with satisfaction that the authorising officer by delegation declared that the resources allocated had been used for the purpose intended and in accordance with the principle of sound financial management and that the control procedures put in place provided the necessary guarantees as to the legality and regularity of the underlying transactions;

    8.  Notes that the average payment time stood at 23,1 days in 2023 compared to 24,32 days in 2022; calls on the CJEU to continue its efforts to reduce the time for payment, particularly considering that 81 % of invoices were received electronically in 2023;

    9.  Notes that the CJEU’s mission budget, which stood at EUR 638 000 for both staff and Members in 2023, continued to decrease by 3,3 % in 2023 compared to 2022; notes that 85,1 % of the appropriations for missions in 2023 were used compared to 46,6 % in 2022 due to the persistent travel restrictions in application at that time;

    Internal management, performance and internal control

    10.  Notes the significant steps taken by the CJEU in 2023 towards its judicial reform which has led to the partial transfer of jurisdiction to give preliminary rulings from the Court of Justice to the General Court; notes that a political agreement with Parliament and Council was reached at the end of 2023 in view of the amendment to the Statute of the CJEU and with a view to improving the functioning of the CJEU against the background of a steady increase in the caseload and in the complexity and sensitive nature of questions raised; notes that, further to the adoption of the reform in 2024, detailed rules and procedures were adopted in order to complete the reform and allow the implementation of the new regulatory framework as of 1 October 2024;

    11.  Notes that, in 2023, the Court of Justice ruled on five cases concerning the principle of primacy in the context of four preliminary rulings brought by the courts in Germany, Ireland, Poland, and Romania, as well as one infringement case concerning Poland; stresses the fundamental importance of the principle of primacy of Union law, which ensures the uniform interpretation and application of Union law across all Member States and safeguards the rule of law as a core value of the Union; strongly reaffirms that the primacy of Union law is the cornerstone of the Union’s legal order and highlights the pivotal role of the CJEU in upholding the rule of law across the Union. Furthermore, notes that the General Court ruled on six cases related to measures for the protection of the Union budget against breaches of the principles of the rule of law by the Hungarian government, which systematically undermines core Union values; urges the Commission to take decisive enforcement actions against any Member State that challenges or disregards the binding nature of CJEU rulings; highlights that, in cases relating to the investigation of the Union budget, the principles of due process and fundamental rights must be fully respected by all competent authorities;

    12.  Notes that Article 4(2) of the Treaty on European Union states that “The Union shall respect the equality of Member States before the Treaties as well as their national identities, inherent in their fundamental structures, political and constitutional, inclusive of regional and local self-government. It shall respect their essential State functions […]”;

    13.  Condemns any national measures or legislative actions that seek to undermine the codification and enforcement of CJEU judgments; calls for the establishment of a formal monitoring mechanism to track Member State compliance with CJEU rulings and recommends linking compliance with EU funding disbursement under the rule of law conditionality framework;

    14.  Notes that 821 new cases were submitted to the Court of Justice in 2023, compared to 806 in 2022, out of which 63 % were references for preliminary ruling and 28,6 % were appeals against decisions of the General Court; notes that the General Court saw a major increase of cases with 1 271 new cases in 2023 compared to 904 in 2022, including an exceptional series of 404 joint cases submitted in October 2023; notes that in 2023 for the General Court, 37 % of the new cases, including the series of 404 joint cases, concerned actions relating to institutional law, 24,3 % concerned actions relating to intellectual property and 6 % concerned disputes between institutions of the Union and their staff; notes that the total number of pending cases remains stable when compared to previous years: considering the previously mentioned 404 cases as a single case, 2 587 cases were pending at the end of 2023, compared to 2 585 at the end of 2022 and 2 541 at the end of 2021;

    15.  Notes that the Court of Justice closed 783 cases in 2023, compared to 808 in 2022, and that the General Court closed 904 cases in 2023, compared to 858 in 2022;

    16.  Welcomes the decrease in the average length of proceedings for the cases closed by the Court of Justice, whereas in 2023 that average was 16,1 months, compared to 16,4 months in 2022; notes that the average duration for the cases closed by the General Court was 18,2 months, compared to 16,2 months in 2022, which the General Court explained was due to the nature and related complexity of the proceedings managed in 2023;

    17.  Notes the decrease in the average time taken to deal with direct actions before the Court of Justice (from 23,5 months in 2022 to 20,8 months in 2023) and with references for preliminary rulings (from 17,3 months to 16,8 months); notes that, as regards the litigation before the Court of Justice, there was a significant increase in the number of direct actions, in particular in the field of the environment, and that the questions referred to the Court of Justice for a preliminary ruling in 2023 related principally to the area of freedom, security and justice, followed by taxation, consumer protection and transport; notes that, as regards the litigation before the General Court, there was an increase of cases in the fields of intellectual property and economic and monetary policy, including banking;

    18.  Notes with satisfaction the high use rate of e-Curia in 2023, with 10 502 e-Curia accounts being registered: 94 % of lodgements before the General Court were made via e-Curia, which is the same as in 2022, while the use rate of e-Curia at the Court of Justice went up to approximately 89 %, compared to 87 % in 2022;

    19.  Appreciates the progress made in digitising the judicial archives with a view to preserving documents for future consultation and facilitating access for researchers and the public by means of a digital portal;

    20.  Welcomes the performance-based approach developed by the CJEU, allowing the CJEU to take decisions based on performance outcomes and the level of achievement of its objectives, measured through a set of workload and operational indicators; notes that the key performance indicators used by the CJEU cover a wide range of specific areas in support of the five management objectives relating to the proper functioning of the CJEU, digitalisation and emerging technologies, openness and transparency, multilingualism and human resources management;

    21.  Notes that the internal control framework of the CJEU was subject to an in-depth evaluation in 2022-2023, which confirmed its soundness; notes that, as part of that evaluation, the financial control circuits were adapted in order to make the controls more efficient;

    22.  Notes that the main internal audits carried out in 2023 concerned the CJEU’s expenditure on the cleaning of buildings, the effectiveness of the internal control system to safeguard the CJEU’s IT assets and the staff selection procedures; notes that an internal audit also carried out a study on the use of artificial intelligence in the area of justice in relation to the implementation of a “strategy for integrating tools based on artificial intelligence into the operation of the CJEU”; notes that, in many cases, the services of the CJEU took actions to implement the internal audit recommendations before the formal finalisation of the internal audits and that those actions were considered satisfactory by the internal auditor;

    Human resources, equality and staff well-being

    23.  Notes that, at the end of 2023, the CJEU employed 1340 officials (58 %), 765 temporary agents (33 %) under Articles 2(a), 2(b) and 2(c) of the Conditions of Employment of Other Staff of the EU, and 198 contract agents (9 %); notes that, at the end of 2023, the occupation rate of the establishment plan stood at 97,11 %; notes further that the annual turnover of staff was 7,8 % in 2023, which was particularly due to the 20 % of those staff who left the CJEU by taking retirement;

    24.  Notes that the Court of Justice is composed of 27 Judges and 11 Advocates General and that no new Judge or Advocate General took office in 2023; notes further that the General Court is composed of 54 Judges and that two new Judges, one woman and one man, took office during 2023; notes further that a new Registrar for the General Court was elected in 2023;

    25.  Welcomes the CJEU’s detailed responses to the questionnaire from Parliament’s Committee on Budgetary Control, provided as part of the current discharge procedure, particularly regarding staff distribution at the end of 2023; notes that the gender composition of the Court of Justice and the General Court continues to be very unbalanced; expresses its appreciation of the letter from the President of the General Court to the President of the Conference of the Representatives of the Member States in 2024, calling on Member States to take the need for gender balance into account when nominating candidates for the replacement of Judges and Advocates General; calls on Member States to take the need for gender balance into account when nominating candidates for the replacement of judges;

    26.  Takes note that, of the 2 303 officials and agents serving at the end of 2023, 61 % are women; welcomes the fact that the proportion of women in administrative positions is 55 %, and especially the fact that, in managerial posts, the proportion has increased to 43 %, compared to 40 % in 2022 and 2021, confirming the upward trend recorded since 2018 (41 % in 2020, 39 % in 2019 and 37,5 % in 2018); notes however that representation of women was the highest in assistant grades, whereas it was the lowest in senior management positions; calls on the CJEU to ensure a greater representation of women in senior management positions and take further measures to promote gender balance at all levels; welcomes the efforts deployed by the CJEU in favour of equality, inclusion and diversity, especially at recruitment stage;

    27.  Calls on the CJEU to publish an annual Gender and Diversity Report to provide transparency on gender representation at all levels of the institution, including Judges, Advocates General, and administrative staff, as well as to provide for concrete measures of improving gender parity in senior positions;

    28.  Welcomes that all Union nationalities are represented in the staff of the CJEU, but notes that certain nationalities are more represented than others; welcomes the continued efforts of the CJEU to promote a better geographical balance among its staff, in particular by fostering the visibility and attractiveness of its job vacancies, creating and offering more favourable job conditions to attract temporary agents from certain less-represented Member States and communicating widely to varied audiences on the job opportunities at the CJEU in 2023; notes that a significant effort was made to attract many talented young people from different Member States though the CJEU’s internship programme; invites the CJEU to examine whether trainees are proportionally represented from all member states;

    29.  Urges the CJEU to promote a multilingual working environment, recognizing its potential to enhance the fair distribution of nationalities among its staff; calls on all EU institutions to uphold and ensure the principle of multilingualism;

    30.  Welcomes the work done by the High Level Interinstitutional Group on enhancing the attractiveness of Luxembourg as a place of work for staff; calls on the CJEU to maintain and enhance cooperation with other Luxembourg-based institutions across different initiatives; notes with appreciation that the budgetary authority approved for the financial year 2025 the necessary appropriations in order to allow the granting of a housing allowance to staff at lower grades, as recommended by the High Level Interinstitutional Group; asks that Parliament be updated on the progress of such initiatives intended to improve the attractiveness of Luxembourg as a place of work;

    31.  Notes that, in 2023, the CJEU implemented several initiatives to promote physical and mental wellbeing of staff through specialised workshops and awareness-raising activities; notes that the teleworking scheme, which entered into force on 1 May 2022, was assessed positively by the managers, among whom 92 % replied that the productivity of staff teleworking was either equivalent or better than prior to the existence of the teleworking scheme; notes that, with a view to achieving a better work and personal-life balance, in 2023, the CJEU renewed the possibility for its staff to telework from outside the place of employment up to 10 days per year, especially during the judicial vacations;

    32.  Welcomes the ongoing awareness-raising, information and training campaigns aiming at promoting inclusion, mutual respect, cooperation and support for people with disabilities and their helpers;

    33.  Notes that the number of working days of sick leave was 20 198 in 2023, corresponding to a reduction of 14,78 % compared to 2022; notes with concern that the medical service reported 11 cases of burnout in 2023; welcomes a thorough analysis of diagnostic reports undertaken by the CJEU to identify instances of professional burnout and the CJEU’s focus on preventive measures, especially the reinforcement of its medical and social workers’ team, the prevention of psychosocial risks in the workplace and the introduction of awareness-raising activities for management on the right to disconnect and the risks of over-performance; encourages the CJEU to maintain focus on this problem in order to prevent any further cases associated with burnout and inform the Parliament of the measures taken in this regard;

    34.  Notes that an administrative enquiry was launched in 2023 on an alleged case of sexual harassment concerning a member of staff and that this case was closed in 2024 with a sanction; expresses concern that a procedure of assistance for alleged harassment concerning a judge was also filed in 2023 but no harassment was established in that case; notes that an interdepartmental working group, established in March 2023, therefore ahead of the ratification of the Council of Europe Convention on preventing and combating violence against women and domestic violence, examined the rules and procedures in place in the CJEU to prevent harassment and made some recommendations with a view to improving these rules and procedures; encourages the CJEU to follow up and continue to show no tolerance for harassment in the workplace by introducing mandatory training on unconscious bias and ethical standards for all judges and senior officials to prevent abuse of power;

    Ethical framework

    35.  Notes with satisfaction that, as requested in previous discharge recommendations, the new code of conduct on the rights and obligations of officials and other servants of the CJEU reflecting the CJEU’s values and commitment to ethics was drawn up in 2023 and adopted in March 2024; notes that the code of conduct includes provisions on conflict of interests, duty of loyalty, duty of confidentiality and discretion, outside activities, occupational activities after leaving the service and publications and also applies to seconded national experts and trainee judges hosted under the European Judicial Training Network; notes that, in 2023, awareness-raising activities and revamped training on the code of conduct were organised for staff and managers, with a particular focus on newcomers; calls for a mandatory training for all staff on a regular basis and asks that Parliament be kept informed about the implementation of the code of conduct;

    36.  Notes that, before the code of conduct entered into force, two potential cases of conflict of interest were declared and handled in accordance with the procedures in place, with the aim of ensuring that the new members of staff concerned were not involved in the management of files that they knew from a previous job;

    37.  Notes that, further to the adoption of the code of conduct for Members and former Members of the CJEU, the declaration of interests of the Members have been published online to avoid any potential conflict of interest in the handling of cases; notes that the CJEU is constantly reassessing its internal rules on this matter with a view to updating those rules and to ensuring the highest possible standards of ethical behaviour; calls on the CJEU to establish an independent ethics committee to oversee compliance with the code of conduct and investigate potential breaches; calls for mandatory annual ethics training for all CJEU personnel, including Judges and Advocates General to preserve the integrity of the CJEU; asks the CJEU to inform Parliament about the results of any further assessment of the effectiveness of that measure aimed at the prevention of conflicts of interest;

    38.  Welcomes the publication of the declarations of interests of the Members of the CJEU but calls for the introduction of a standard pre-appointment screening process to identify and mitigate potential conflicts of interest at an early stage; urges the Council to establish transparent guidelines for Member States when nominating candidates for judicial positions at the CJEU;

    39.  Urges the CJEU to introduce a mandatory recusal policy for judges in cases where they have past professional affiliations with litigants appearing before the CJEU; calls for stricter conflict-of-interest screening for judges and high-ranking staff, including regular updates to financial disclosure requirements; asks for the publication of real-time recusal decisions in cases where judges declare a conflict of interest, ensuring greater transparency in the judicial process and reinforcing public confidence in the impartiality and integrity of the CJEU;

    40.  Notes that in 2023, all Members of the CJEU were resident of Luxembourg in accordance with Article 14 of the Statute;

    41.  Notes that the list of external activities carried out by the Members of both the Court of Justice and the General Court has been published on the CJEU website since 2018; further notes that the list is difficult to read for the general public and recommends its revision to ensure greater clarity and informativeness; notes that the prior authorisation by the general meeting of the Court of Justice or by the plenary conference of the General Court is only granted when the external activity is compatible with the requirements of the code of conduct and with the Members’ obligations to be available for judicial activities; asks the CJEU to inform the discharge authority about any initiatives to improve the readability of the information related to external activities, in line with previous discharge recommendations;

    42.  Notes that the rules governing Members’ travels, missions and use of drivers and cars, as updated in 2021, provide that only the running costs resulting from the car use for purposes related to the execution of a mission order or to the exercise of his or her mandate within a limit of 10 000 km are borne by the CJEU; reiterates its opinion that the use of the car fleet outside of the strict performance of the duties of the Members of the CJEU should not take place under any circumstances, notes that the CJEU reported to be in discussion with other institutions in order to obtain a harmonised set of rules for the use of official vehicles, while respecting the autonomy of each institution; invites all Union institutions to agree on a single system to be applied horizontally, which would reduce the confusion and increase transparency and efficiency in the use of public money; asks the CJEU to keep Parliament informed of any progress in this matter;

    43.  Notes that an OLAF case, referred to in previous discharge resolutions, which dealt with the conduct of a member of staff that might have constituted a serious failure to comply with their obligations, was closed in 2023; notes that the CJEU is not aware of any new OLAF investigation or recommendation in 2023;

    44.  Notes that the CJEU did not report any cases of fraud, corruption or misuse of Union funds in 2023; notes that the CJEU’s anti-fraud strategy is an integral part of its integrated internal control and risk management framework, with a particular focus on the risks of improper disclosure of information;

    Transparency and access to justice for citizens

    45.  Welcomes the CJEU’s engagement to enhance transparency, access to justice and public openness, thus contributing to foster public trust in the Union institutions;

    46.  Notes that, in 2023, the CJEU consolidated the streaming service for hearings of the Court of Justice and of the General Court on the Curia website, thus facilitating the access of citizens to the judicial activities of the CJEU; welcomes the improvement of the CVRIA website, in terms of its structure, functionalities and content; welcomes that the delivery of judgments of the Court of Justice, the reading of opinions of the Advocates General, the hearings of the Grand Chamber and certain hearings of chambers sitting with five Judges have been broadcast live on the Curia website since 2023; calls on the CJEU to further improve transparency by broadcasting all hearings of both the Court of Justice and the General Court on its website and permanently storing them online;

    47.  Welcomes that, further to the reform of its Statute, the CJEU will publish statements of case or written observations lodged in preliminary ruling proceedings after the closure of such proceedings, except in cases of objection to the publication of a person’s statement of case or observation; underlines that such publication will improve transparency and access to justice for citizens and calls on the CJEU to publish all documents related to a file on its website; calls on the CJEU to implement a procedure that could be used by any person to access in house all the documents related to a case;

    48.  Notes that rules on the use of videoconferencing were adopted by the General Court in April 2023 and by the Court of Justice in September 2024, according to which a party may request the use of videoconferencing where security or other serious reasons prevent that party’s representative from participating in a hearing in person;

    49.  Notes that the rules laid down by the CJEU decision of 26 November 2019 concerning public access to documents held by the CJEU in the exercise of its administrative function do not apply to judicial documents for which access is governed by the Rules of Procedure of the Court of Justice or the Rules of Procedure of the General Court; notes that the CJEU registered 21 requests of public access to administrative documents in 2023 and granted access to administrative documents in 12 cases; notes that the European Ombudsman found no instances of maladministration on the part of the CJEU in 2023;

    50.  Invites the CJEU to simplify the process of finding specific rulings on e-curia; welcomes efforts to make the interface more client-friendly and intuitive;

    Digitalisation, cybersecurity and data protection

    51.  Notes that compared to 2022 the budget expenditure increased by 10,9 % for IT projects, by 13 % for IT equipment, by 59 % for cybersecurity projects and by 72 % for cybersecurity services, licences and equipment in 2023;

    52.  Notes that the implementation of major digitalisation projects under the digital transformation strategy remained a priority for the CJEU in 2023, such as the development of the integrated case management system (SIGA), the promotion of the use of the e-Curia application for the lodging and notification of procedural documents by electronic means, the adoption of eSignature and the adoption of HAN/Ares electronic document record and management system; notes that the CJEU tracks the return on investment in digitalisation projects in terms of costs and resources efficiency and asks the CJEU to keep the discharge authority informed of its findings in that area;

    53.  Notes that, as part of its comprehensive initiative to increase accessibility and inclusion for persons with vulnerability, the CJEU has continued to implement the “accessibility by design” approach for any change and evolution of its IT systems; notes that, following an audit of the Curia website, the CJEU started to improve the site’s accessibility to a wide range of users, such as people with visual impairments, hearing impairments or learning disabilities;

    54.  Notes that the CJEU implemented several projects based on artificial intelligence (AI), such as the automation of document analysis for references to applicable legislation and assistance with invoice verification through robotic processes and hearing transcription, in line with its new AI integration strategy adopted in June 2023; underlines that it is of vital importance that AI is used in a manner which fully preserves the independence, the quality and the serenity of the legal processes, is in full consideration of ethical matters and is used under human oversight and allowing human intervention in order to avoid negative consequences or risks, or stop the system if it does not perform as intended; notes that, as part of that strategy, the CJEU set up an AI management board composed of members of the Court of Justice and of the General Court to oversee the ethical aspects of AI use within the CJEU and to set clear boundaries for its application; welcomes the staff guidelines on the use of AI issued by the board; welcomes the initiatives in place to upskill employees in digital competencies through the training path developed in cooperation with the Interinstitutional Committee for Digital Transformation (ETA); emphasises that the digitalisation of justice and the adoption of emerging technologies such as AI will offer significant advantages for the efficient functioning of the CJEU; recommends however that the CJEU anticipate the associated cybersecurity risks and strengthen even more its collaboration with the EU Agency for Cybersecurity and CERT-EU;

    55.  Notes that no EDPS enquiries were communicated to the CJEU in 2023; notes that, in 2023, EDPS had not addressed any specific recommendation to the CJEU following its investigation regarding the use of cloud services by Amazon web services; notes that EDPS published a decision in 2023 confirming compliance of the CJEU’s use of cloud videoconferencing services with data protection law; reiterates however its concerns regarding the use of external cloud services, given the growing threats about cybersecurity and digital sovereignty;

    56.  Welcomes the CJEU adoption of a cyber roadmap in 2023 and strengthening of its cybersecurity operational capabilities to better protect its systems against the increasing number of cyberattacks; underlines furthermore that a robust cybersecurity strategy is an essential tool to fight against foreign interferences aiming to undermine the integrity of the European Institutions; notes that the CJEU has taken various measures to reinforce its cybersecurity preparedness and ability to recover from security incidents, including through its participation in the governance of the Interinstitutional Cybersecurity Board and through a combination of cybersecurity controls and tools in line with the recommendations of CERT-EU; notes that the budgetary authority approved for the financial year 2025 the necessary appropriations for two additional posts in order to reinforce the CJEU’s staff capacities in the field of cybersecurity;

    57.  Welcomes the measures taken, such as cybersecurity audits, staff training and rapid incident response protocols, to protect the CJEU’s technological infrastructure from cyber threats; stresses that the digitisation of justice and the use of new technologies such as artificial intelligence will bring many benefits in terms of the smooth functioning of the CJEU, but also entail risks that the CJEU needs to pre-empt and protect itself against; suggests in this regard that the CJEU develop a cybersecurity strategy and step up collaboration with other Union institutions, in particular ENISA (the EU Agency for Cybersecurity), on the prevention of cyber-attacks, the number and sophistication of which are growing exponentially in Europe;

    58.  Welcomes the initiative to assign fictitious names to anonymised cases, by using a computerised automatic name generator, in order to strengthen the protection of personal data and facilitate the identification of individual cases;

    59.  Notes with satisfaction the amendment to the Rules of Procedure of the General Court, which will clarify and simplify judicial procedures, including the possibility of using videoconferencing for hearings, electronic signature of decisions and the designation of pilot cases;

    Buildings

    60.  Notes that, following-up on the cross services reflection about the most efficient use of the CJEU’s premises, that was concluded in 2023, pilot projects were launched; notes that the results of those projects, together with other factors, such as environmental and budgetary aspects, quality of justice, well-being at work, inclusion, accessibility and the attractiveness of the CJEU, will be taken into account in the final decision on the use of the CJEU’s buildings; asks that Parliament be kept informed about the implementation of those conclusions and the consequences for the organisation of the workspace;

    61.  Notes that, in 2023, the CJEU further pursued its comprehensive initiative to increase accessibility and inclusion for persons with disabilities, with the aim of guaranteeing access to the CJEU, physically or virtually, to all individuals, participants in proceedings and visitors; notes further that, in 2023, the CJEU started to make an inventory of its infrastructure with a view to complying with the new national accessibility legislation as of 1 January 2032; asks that Parliament be kept informed about further initiatives in this area;

    Environment and sustainability

    62.  Notes with satisfaction that, in 2023, the CJEU continued to significantly reduce its energy consumption and carbon footprint compared to 2015, which is the baseline for the implementation of the CJEU’s eco-management and audit scheme strategy, thanks to energy-saving measures and optimisation of its heating, cooling and lighting infrastructures; notes that heating consumption was reduced by 33,5 %, electricity by 28,7 %, water by 20,1 %, office paper by 63 %, office and canteen waste by 43 % and greenhouse gas emissions by 30,2 % in 2023 compared to 2015; welcomes that the CJEU applied green procurement criteria in 10 calls for tender above EUR 60 000; welcomes the CJEU’s commitment to the Eco-Management and Audit Scheme (EMAS); encourages the CJEU to continue its efforts in reducing its environmental impact, with a strategy to reach carbon neutrality by 2035;

    63.  Welcomes that the CJEU has taken several initiatives to support and increase sustainable mobility for its staff and Members, including subsidies for public transportation, subsidies for self-service bicycles, improved bike parking facilities and improved facilities for hybrid and electrical cars;

    Interinstitutional cooperation

    64.  Welcomes the budgetary savings achieved through cooperation with other institutions and in particular the shared applications and hosting services based on service-level agreements with the Commission as well as the participation in interinstitutional procurement procedures, which have allowed the CJEU to optimise costs and resources;

    65.  Welcomes the efforts of the European Judicial Training Network (EJTN) in training national judges on EU law; notes with appreciation that, in line with the CJEU’s declaration entitled “Supporting the EJTN to shape a sustainable European judicial culture”, the CJEU and the EJTN sought to increase the diversity of long-term trainees in 2023, with the aim of ultimately increasing their number to one per Member State; notes that the measures taken have already been successful since the CJEU has trainees from some Member States which previously did not actively participate in the programme; notes that 15 remunerated traineeships were offered for the year 2023-24; calls on the CJEU to further develop its knowledge-sharing initiatives, including joint case-law databases and virtual collaboration platforms to support national courts in complex legal interpretations;

    66.  Emphasises that traineeships should be remunerated in compliance with the European Parliament’s resolution of 14 June 2023 on Quality Traineeships in the Union (2020/2005(INL)), which calls for all internships in Europe to be paid; welcomes that currently all trainees at the CJEU receive a grant during their stay, mainly from the CJEU and, in some specific cases, from other sources; take notes that the CJEU only accepts a few trainees (less than 10 per year) paid by other sources, and for short periods (on average 2 months); welcomes that in such cases, the CJEU administration carefully checks that these trainees receive a grant, allowance or remuneration for this traineeship, paid directly by their employer or academic institution;

    67.  Appreciates that the CJEU fully cooperates with OLAF, the Court, the EDPS and the European Ombudsman; notes that, in 2023, the CJEU has continued to work towards maintaining the established dialogue with national courts, and in particular with the constitutional and supreme courts, and that the CJEU hosted a number of meetings, including the annual meeting of national judges; encourages deeper cooperation between the CJEU and national courts to strengthen uniform application of Union law; recommends establishing a permanent judicial exchange programme for judges from Member States to work alongside their CJEU counterparts, fostering best practices in the interpretation of Union law;

    Communication

    68.  Notes that, in 2023, the CJEU strengthened its efforts to engage with Union citizens by enhancing its outreach on social media; notes that, at the end of 2023, the number of subscribers to the CJEU’s LinkedIn account increased by 32 % and the number of followers on the CJEU’s two accounts on X (formerly Twitter) by 9 %,while the views on its YouTube channel increased by 84,96 % compared to the previous year;

    69.  Welcomes the CJEU’s efforts to enhance strategic communication and transparency towards Union citizens on the judicial activities of the CJEU, especially through the organisation of an open day, the offer for visitors, in particular the special virtual visits, in which 800 students participated in 2023, and the review of the drafting of its press releases and online publications in an accessible style, about matters of media interest or which have an impact on the lives of citizens.

    (1) Regulation (EU, Euratom) 2024/2019 of the European Parliament and of the Council of 11 April 2024 amending Protocol No 3 on the Statute of the Court of Justice of the European Union, OJ L, 2024/2019, 12.8.2024, ELI: http://data.europa.eu/eli/reg/2024/2019/oj.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – Old challenges and new commercial practices in the internal market – P10_TA(2025)0107 – Thursday, 8 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to its resolution of 18 January 2023 on the 30th anniversary of the single market: celebrating achievements and looking towards future developments(1),

    –  having regard to the report by Enrico Letta of 17 April 2024 entitled ‘Much more than a Market’ (the Letta report),

    –  having regard to the report by Mario Draghi of 9 September 2024 entitled ‘The future of European competitiveness’ (the Draghi report),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘the 2025 Annual Single Market and Competitiveness Report’ (COM(2025)0026),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’ (COM(2025)0030),

    –  having regard to the Commission communication of 11 February 2025 entitled ‘A simpler and faster Europe: Communication on implementation and simplification (COM(2025)0047),

    –  having regard to the question to the Commission on the old challenges and new commercial practices in the internal market (O-000012/2025 – B10‑0264/2025),

    –  having regard to Rules 142(5) and 136(2) of its Rules of Procedure,

    A.  whereas the European Union’s ability to compete and prosper in the global economy is vital, especially amid the current geopolitical challenges and climate and other environmental crises; whereas its current, medium and long-term competitiveness relies on a fully integrated and efficient single market that allows European businesses to innovate and prosper and prioritises the reduction of administrative burdens;

    B.  whereas the single market, comprising nearly 450 million citizens and 23 million businesses, generates a gross domestic product (GDP) of EUR 17 trillion, positioning the EU among the world’s three largest economies and contributing approximately one-sixth of global economic output;

    C.  whereas the Draghi report demonstrated that compliance costs resulting from various pieces of legislation remain very high for European companies, therefore hindering European innovation capacity;

    D.  whereas it remains crucial to improve the functioning of the single market by addressing persisting fragmentation through common, harmonised EU policies, more efficient implementation and enforcement, and the simplification of EU rules; whereas reducing administrative burdens and costs, especially for small and medium-sized enterprises (SMEs), can help foster innovation and support European businesses; whereas unlocking the full potential of the single market requires overcoming persistent barriers to the free movement of goods and services;

    E.  whereas the rapid expansion of digital platforms and e-commerce has introduced new market dynamics and whereas evolving trends in global e-commerce are exerting additional pressure on customs controls, market surveillance and consumer protection authorities;

    F.  whereas geopolitical shifts and global economic transformations are reshaping supply chains, requiring the EU to adapt its single market policies; whereas the EU has set the highest standards for product safety and consumer protection, both offline and online;

    G.  whereas attention has been drawn to a growing number of cases reported across the EU in which goods and services offer reduced quantity or quality, despite stable or rising prices;

    Old and enduring challenges

    1.  Reaffirms that the single market has been a cornerstone of European economic integration, enabling the free movement of goods, services, capital and people; stresses, however, that there are long-standing and emerging challenges that necessitate ambitious reforms without harming European competitiveness or imposing unnecessary administrative burdens on companies; calls on the Commission and the Member States to accelerate efforts towards implementing these reforms and to eliminate remaining unjustified obstacles to the free movement of goods and services, while ensuring a high level of consumer protection;

    2.  Calls on the Commission and the Member States to maintain strong consumer protection while also providing for competition rules that are innovation-friendly, future-proof and proportionate; emphasises the need to ensure legal certainty and consistency and minimise regulatory complexity and fragmentation, which could disproportionately affect SMEs, start-ups and scale-ups;

    3.  Highlights that ongoing barriers and regulations have constrained the development of the single market, as noted in the Draghi report; calls for a shift towards a regulatory approach that empowers companies to grow, innovate and lead internationally, thereby restoring the single market as a true engine of growth and competitiveness;

    4.  Calls on the Commission to ensure that future legislative initiatives are consistently guided by the strategic priorities outlined in its communications and competitiveness strategy;

    5.  Underscores that, as demonstrated by the Letta and Draghi reports, there is still untapped potential in the services sector; calls for further action in this sector to address the significant obstacles that persist, starting from setting ambitious targets in the upcoming single market strategy; notes that services account for three quarters of EU GDP, represent two thirds of employment and create 9 out of 10 new jobs in the EU economy; notes also, however, that services are still the least developed segment of the EU single market;

    6.  Welcomes the proposal for a regulation on a public interface connected to the Internal Market Information System for the declaration of posting of workers and amending Regulation (EU) No 1024/2012 (COM(2024)0531), which should lead to simplification and strengthened enforcement; notes also that digitalisation could significantly reduce administrative burdens for cross-border services and ensure better access for businesses and consumers; calls, in this regard, for a single declaration portal and the digitalisation of A1 forms for cross-border services;

    7.  Stresses the importance of the effective recognition of professional qualifications and the removal of unjustified barriers to the free movement of professionals in order to make EU professional services globally competitive in future decades; encourages the Commission to remain vigilant in pursuing infringement procedures where Member States do not comply with EU legislation on the recognition of qualifications;

    8.  Stresses that single market rules should safeguard access to public services and preserve consumer rights as well as other overriding reasons of public interest; adds that any assessment to evaluate restrictions in the single market for services should include qualitative criteria;

    9.  Notes the role that EU public procurement can play in overcoming barriers to market entry, supporting sustainable and resilient industrial ecosystems, high quality jobs and value creation in the EU;

    10.  Acknowledges that the new legislative framework (NLF) has contributed to consistency in EU product legislation and that since its adoption, the industry sector, supply chains and products have experienced important transformations in the light of the digital and green transition, but also changes in market dynamics; notes that the 2022 evaluation of the NLF identified critical challenges, such as potential foreign influence, illegal practices, inadequacies in addressing digitalisation and the circular economy, and potential updates to obligations and definitions for certain economic operators to reflect new market realities;

    11.  Stresses that addressing these issues and making the NLF future-proof is essential to ensure coherence, reduce costs and ensure free movement of goods; calls, therefore, for an update to the NLF in order to streamline product rules, promote digitalisation and simplify compliance and market surveillance procedures; considers that the NLF should promote the use of Digital Product Passports as a means of demonstrating product conformity and complying with information requirements;

    12.  Calls on the Commission and the Member States to simplify EU rules and make them easier to implement, and to significantly reduce administrative burdens, in particular for SMEs, which play a vital role in sustaining local communities and economies; stresses the importance of ensuring legal certainty and consistency for businesses, as well as predictability for long-term investments, which are essential to boost competitiveness, innovation and resilience and to deliver fast and meaningful improvements for consumers and businesses; calls, furthermore, on the Member States to prevent actions that could compromise the level playing field in the internal market;

    13.  Calls on the Commission to facilitate the activities of SMEs and small mid-caps within the single market, notably with a dedicated simplification omnibus;

    14.  Recognises that inconsistent and fragmented enforcement of EU laws across the Member States continues to distort competition and undermine the single market’s integrity; adds that primary responsibility for enforcement of EU rules lies with the Member States; invites the Commission to make full use of its enforcement powers; calls for improved monitoring and enforcement mechanisms at EU level, such as harmonised rules on minimum levels of checks, harmonised methodologies to conduct these checks and joint inspections, in order to ensure the uniform application of EU law and, where applicable, swift redress for consumers;

    15.  Stresses the importance of maintaining a competitive and dynamic economic environment by safeguarding consumers’ rights and enforcing digital competition rules to address unfair business practices that distort market conditions; calls, furthermore, on the Member States to increase the capacity of market surveillance authorities and customs authorities to ensure effective enforcement of single market rules, particularly in respect of e-commerce and imports from non-EU countries;

    16.  Recalls that territorial supply constraints in the retail and wholesale segments fragment the single market, limit consumer choice and contribute to significant price disparities across the Union, particularly affecting the prices of basic consumer goods; highlights that while competition law penalises some of these practices effectively, many fall outside its scope; calls, therefore, on the Commission to propose measures to address the issue, including stronger enforcement against anti-competitive distribution agreements, in order to safeguard fair competition, thereby ensuring the integrity of the single market;

    17.  Calls on the Commission to investigate the causes for the differentiated levels of the inflation of basic goods and consumer price increases observed in some EU Member States;

    18.  Considers that the single market is a key tool in times of crisis if the Member States can act in a coordinated way; considers that the recently adopted Internal Market Emergency and Resilience Act(2) will be crucial to ensure coordination in order to prevent shortages and ensure the smooth functioning of the single market, including the free movement of essential goods and services throughout the EU;

    19.  Calls on the Commission to empower consumers to easily exercise their passenger rights by establishing national enforcement bodies, which should be granted harmonised investigation and enforcement powers and which should be able to efficiently process individual complaints and related fines;

    20.  Highlights that e-commerce measures targeting geo-blocking, notably the Geoblocking Regulation(3), have been successful in creating a framework for a less fragmented single market and enhancing consumer choice for online shopping; notes with concern that the implementation of the regulation has been inadequate;

    21.  Notes that the European Accessibility Act(4) will become applicable across all EU Member States as of 28 June 2025; stresses the importance of its full and effective implementation by the Member States in order to ensure the harmonisation of accessibility requirements for products and services, thereby guaranteeing their accessibility to persons with disabilities across the EU internal market;

    Emerging commercial practices

    22.  Highlights that the rapid expansion of digital platforms and e-commerce has introduced new market dynamics and has created advanced opportunities and challenges and risks for users; acknowledges that the Digital Markets Act(5) (DMA) and the Digital Services Act(6) (DSA) constitute key legislative instruments ensuring fair competition, contestability and fairness in digital platforms, while also fostering consumer protection and a safer, more trustworthy and more transparent digital environment in the digital economy; calls for proper enforcement of the EU’s new technology legislation to ensure genuine, autonomous and informed consumer choice, protection and fair competition;

    23.  Considers it essential to ensure the effective implementation and enforcement of these two legislative acts and urges the Commission to conclude its ongoing investigations in the framework of the DSA and the DMA;

    24.  Stresses that the implementation of the DSA must fully respect freedom of expression; underlines that actions against illegal content must not restrict lawful speech and calls for transparent enforcement to protect an open and democratic digital space;

    25.  Calls on the Commission and the Member States to ensure that the Artificial Intelligence (AI) Act(7) maintains a risk-based, innovation-friendly approach, ensuring that compliance requirements are proportionate to the actual risks posed by AI applications while respecting the need to ensure a high level of protection of health, safety and fundamental rights;

    26.  Welcomes the Commission’s ‘digital fairness’ fitness check of consumer law and the upcoming public consultation; underlines that some issues remain unaddressed concerning the protection of consumers online, leading to an imbalance between consumers and traders within the digital economy; calls on the Commission to address these issues in the upcoming Digital Fairness Act; believes that digital addiction, online gambling, protection of minors online and persuasive technologies used by online actors, such as targeted advertising, influencer advertising and dark patterns, should fall under the Digital Fairness Act, which should close legal loopholes and be consistent with current legal instruments in order to better protect consumers online, taking into account the need to avoid unnecessary regulatory burdens;

    27.  Notes that evolving trends in global e-commerce and supply chain restructuring are placing greater pressure on customs controls, market surveillance and consumer protection authorities; highlights that the volume of unsafe and illicit products sold on e-commerce platforms, in particular from non-EU countries, has been increasing in recent years; highlights the significance of Digital Product Passports in these processes; calls, therefore, for a reinforced market surveillance framework and a revision of the Consumer Protection Cooperation Regulation(8) and calls on the Council to swiftly adopt its position in order to enable the adoption of the revised Union Customs Code and the establishment of an EU customs authority in 2026;

    28.  Calls on the Member States to allocate sufficient technical, human and financial resources to national authorities; calls on the Member States and the Commission to ensure sufficient funds and expertise to strengthen customs authorities and market surveillance across the Union and to intensify joint activities and EU testing;

    29.  Emphasises the need to strengthen consumer protection in both online and offline markets, ensuring transparency in advertising and pricing, especially concerning dynamic pricing, ensuring fair business practices and stronger safeguards against fraud to foster consumer trust in cross-border commerce and the highest level of protection;

    30.  Stresses that attention has increasingly been drawn to instances where goods and services offer less in terms of quantity or quality while prices remain the same or increase; calls on the Commission to assess the scale and underlying causes of such practices and to explore appropriate measures to enhance transparency and consumer awareness;

    31.  Underlines that environmental sustainability and fair-trade considerations are increasingly shaping commercial practices by playing an important role in consumers’ purchasing decisions and consequently driving businesses towards sustainability; adds that transparency and information for consumers on environmental aspects as well as on socially-responsible and ethical production processes allow consumers to adopt sustainable consumption patterns;

    32.  Calls on the Commission and the Member States to maintain their level of ambition in this regard and work further on EU-wide labelling schemes; recalls that the objective of the Green Claims Directive is to establish a tool to protect consumers against greenwashing by establishing requirements for substantiation and verification;

    33.  Highlights the need to further combat misleading advertising and greenwashing and to strengthen the second-hand market; notes, however, that restrictive sustainability rules may have a negative impact on European competitiveness;

    34.  Highlights that some growing trends in e-commerce raise concerns with regard to goods from non-EU countries not fulfilling EU safety and sustainability requirements, thus negatively impacting SMEs in the EU; welcomes the Commission communication on ‘A comprehensive EU toolbox for safe and sustainable e-commerce’ and asks the Commission to swiftly implement the recommendations contained therein;

    35.  Emphasises that harmonised technical standards are essential for the free movement of goods within the single market, ensuring product safety, quality and performance across the Member States; highlights that standards must reflect the interests, policy objectives and values of the Union by taking into account the views of all stakeholders; adds that the recent Court of Justice of the European Union ruling(9) acknowledges the added value of harmonised standards that form part of EU law because of their legal effects and establishes that they should be made freely accessible; underlines the need to improve the agility of the standardisation framework, particularly for emerging green and digital value chains, and to help industry to maintain competitive positions in key technology markets;

    36.  Considers that the EU must increase its efforts to set up a new mechanism with the Member States and national standardisation bodies to share information, coordinate and strengthen the European approach to international standardisation activities; calls for swift action to update the EU standardisation framework in order to speed up the standardisation process to ensure the rapid publication of harmonised standards that grant presumption of conformity and are aligned with international standards to support global trade while encouraging greater industry participation, particularly from SMEs;

    37.  Stresses the need to reinforce the external dimension of the single market to safeguard the EU’s strategic autonomy and global influence and welcomes the gradual integration of EU candidate countries to the single market with a view to their future EU membership; emphasises that the EU’s high regulatory standards can serve as a global benchmark and must be effectively enforced to ensure a level playing field for European businesses; calls on the Commission to intensify regulatory dialogues and political cooperation with other relevant non-EU countries in order to identify common challenges and try to build joint actions, especially concerning e-commerce, digital rules and consumers;

    38.  Reiterates its call for innovative, complementary and flexible interaction between the ongoing work on the implementation of the EU-Ukraine Association Agreement currently in force and the accession negotiation process, thus allowing for Ukraine’s gradual integration into the EU single market and sectoral programmes;

    Conclusions

    39.  Recognises that geopolitical tensions, climate change, challenges to EU competitiveness and economic disparities pose significant risks to the integrity of the single market; calls for a robust, coordinated and strategic policy response to strengthen the single market;

    40.  Calls for the continued evolution of the single market to address both remaining unjustified barriers and emerging commercial challenges; takes the view that eliminating regulatory fragmentation, promoting simplification, significantly reducing administrative burdens, enhancing enforcement and ensuring resilient supply chains are critical to maintaining the EU’s competitive edge and fair market conditions and enhancing the single market; underlines the importance of consulting all relevant stakeholders in these processes;

    41.  Emphasises the importance of digital transformation, the circular economy and adaptability to global economic shifts in securing the EU’s long-term economic dynamism;

    42.  Reiterates that strengthening the internal and external dimensions of the single market is essential for preserving the EU’s strategic autonomy and competitiveness;

    43.  Urges the Commission, therefore, to reflect the foregoing in the forthcoming new single market strategy, scheduled for June 2025, in the 2030 consumer agenda, scheduled for the end of 2025, and in the Digital Fairness Act, scheduled for 2026;

    o
    o   o

    44.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ C 214, 16.6.2023, p. 8.
    (2) Regulation (EU) 2024/2747 of the European Parliament and of the Council of 9 October 2024 establishing a framework of measures related to an internal market emergency and to the resilience of the internal market and amending Council Regulation (EC) No 2679/98 (OJ L, 2024/2747, 8.11.2024, ELI: http://data.europa.eu/eli/reg/2024/2747/oj).
    (3) Regulation (EU) 2018/302 of the European Parliament and of the Council of 28 February 2018 on addressing unjustified geo-blocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment within the internal market and amending Regulations (EC) No 2006/2004 and (EU) 2017/2394 and Directive 2009/22/EC (OJ L 60I, 2.3.2018, p. 1, ELI: http://data.europa.eu/eli/reg/2018/302/oj).
    (4) Directive (EU) 2019/882 of the European Parliament and of the Council of 17 April 2019 on the accessibility requirements for products and services (OJ L 151, 7.6.2019, p. 70, ELI: http://data.europa.eu/eli/dir/2019/882/oj).
    (5) Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (OJ L 265, 12.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/1925/oj).
    (6) Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (OJ L 277, 27.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2065/oj).
    (7) Regulation (EU) 2024/1689 of the European Parliament and of the Council of 13 June 2024 laying down harmonised rules on artificial intelligence and amending Regulations (EC) No 300/2008, (EU) No 167/2013, (EU) No 168/2013, (EU) 2018/858, (EU) 2018/1139 and (EU) 2019/2144 and Directives 2014/90/EU, (EU) 2016/797 and (EU) 2020/1828 (OJ L, 2024/1689, 12.7.2024, ELI: http://data.europa.eu/eli/reg/2024/1689/oj).
    (8) Regulation (EU) 2017/2394 of the European Parliament and of the Council of 12 December 2017 on cooperation between national authorities responsible for the enforcement of consumer protection laws and repealing Regulation (EC) No 2006/2004 (OJ L 345, 27.12.2017, p. 1, ELI: http://data.europa.eu/eli/reg/2017/2394/oj).
    (9) Judgment of 5 March 2024, Public.Resource.Org Inc. v Right to Know CLG, C‑588/21 P, EU:C:2024:201.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – The European Water Resilience Strategy – P10_TA(2025)0091 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Treaty of the Functioning of the European Union (TFEU), in particular Article 191 thereof,

    –  having regard to the Agreement adopted at the 21st Conference of the Parties to the UNFCCC (COP21) in Paris on 12 December 2015 (the Paris Agreement),

    –  having regard to the United Nations 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs), with particular emphasis on the SDG 6 on clean water and sanitation,

    –  having regard to the Kunming-Montreal Global Biodiversity Framework, adopted in December 2022,

    –  having regard to the Stockholm Convention on Persistent Organic Pollutants of 22 May 2001,

    –  having regard to the precautionary principle and the principles that preventive action should be taken, that environmental damage should, as a priority, be rectified at source and that the polluter should pay, as enshrined in Article 191(2) TFEU,

    –  having regard to Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (European Climate Law)(1),

    –  having regard to Directive 2000/60/EC of the European Parliament and of the Council of 23 October 2000 establishing a framework for Community action in the field of water policy(2) (Water Framework Directive),

    –  having regard to Directive 2006/118/EC of the European Parliament and of the Council of 12 December 2006 on the protection of groundwater against pollution and deterioration(3) (Groundwater Directive),

    –  having regard to Directive 2008/105/EC of the European Parliament and of the Council of 16 December 2008 on environmental quality standards in the field of water policy, amending and subsequently repealing Council Directives 82/176/EEC, 83/513/EEC, 84/156/EEC, 84/491/EEC, 86/280/EEC and amending Directive 2000/60/EC of the European Parliament and of the Council(4) (Environmental Quality Standards Directive),

    –  having regard to Directive 2007/60/EC of the European Parliament and of the Council of 23 October 2007 on the assessment and management of flood risks(5),

    –  having regard to Directive (EU) 2020/2184 of the European Parliament and of the Council of 16 December 2020 on the quality of water intended for human consumption(6) (Drinking Water Directive),

    –  having regard to Regulation (EU) 2020/741 of the European Parliament and of the Council of 25 May 2020 on minimum requirements for water reuse(7) (Water Reuse Regulation),

    –  having regard to Directive 2008/56/EC of the European Parliament and of the Council of 17 June 2008 establishing a framework for community action in the field of marine environmental policy (Marine Strategy Framework Directive)(8),

    –  having regard to Directive (EU) 2024/3019 of the European Parliament and of the Council of 27 November 2024 concerning urban wastewater treatment(9) (revised Urban Wastewater Treatment Directive),

    –  having regard to Directive (EU) 2024/1785 of the European Parliament and of the Council of 24 April 2024 amending Directive 2010/75/EU on industrial emissions (integrated pollution prevention and control) and Council Directive 1999/31/EC on the landfill of waste(10),

    –  having regard to Council Directive 91/676/EEC of 12 December 1991 concerning the protection of waters against pollution caused by nitrates from agricultural sources(11),

    –  having regard to Regulation (EU) 2024/1991 of the European Parliament and of the Council of 24 June 2024 on nature restoration and amending Regulation (EU) 2022/869(12),

    –  having regard to Directive (EU) 2022/2557 of the European Parliament and of the Council of 14 December 2022 on the resilience of critical entities and repealing Council Directive 2008/114/EC(13) (Critical Entities Resilience Directive),

    –  having regard to Directive (EU) 2022/2555 of the European Parliament and of the Council on 14 December 2022 on measures for a high common level of cybersecurity across the Union, amending Regulation (EU) No 910/2014 and Directive (EU) 2018/1972, and repealing Directive (EU) 2016/1148 (NIS 2 Directive)(14),

    –  having regard to Directive 2009/128/EC of the European Parliament and of the Council of 21 October 2009 establishing a framework for Community action to achieve the sustainable use of pesticides(15),

    –  having regard to Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing Regulations (EU) No 1305/2013 and (EU) No 1307/2013(16),

    –  having regard to Commission Regulation (EU) 2024/3190 of 19 December 2024 on the use of bisphenol A (BPA) and other bisphenols and bisphenol derivatives with harmonised classification for specific hazardous properties in certain materials and articles intended to come into contact with food, amending Regulation (EU) No 10/2011 and repealing Regulation (EU) 2018/213(17),

    –  having regard to the Commission communication of 19 February 2021 entitled ‘A Vision for Agriculture and Food’ (COM(2025)0075),

    –  having regard to the Commission communication of 11 December 2019 on the European Green Deal (COM(2019)0640),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’ (COM(2025)0030),

    –  having regard to the Commission communication of 12 May 2021 entitled ‘Pathway to a Healthy Planet for All – EU Action Plan: ‘Towards Zero Pollution for Air, Water and Soil’’ (COM(2021)0400),

    –  having regard to the Commission communication of 24 February 2021 entitled ‘Forging a climate-resilient Europe – the new EU Strategy on Adaptation to Climate Change’ (COM(2021)0082),

    –  having regard to the Commission communication of 18 July 2007 on addressing the challenge of water scarcity and droughts in the European Union (COM(2007)0414),

    –  having regard to the Commission communication of 11 March 2020 entitled ‘A new Circular Economy Action Plan: For a cleaner and more competitive Europe’ (COM(2020)0098),

    –  having regard to the Commission communication of 14 November 2012 entitled ‘A Blueprint to Safeguard Europe’s Water Resources’ (COM(2012)0673),

    –  having regard to the EU biodiversity strategy for 2030,

    –  having regard to the COP29 Declaration on Water for Climate Action, endorsed by the European Union,

    –  having regard to the European Oceans Pact announced by Commission President von der Leyen in her political guidelines for the next European Commission (2024-2029) on 18 July 2024,

    –  having regard to the European climate adaptation plan and the European water resilience strategy announced by Commission President von der Leyen in her political guidelines for the next European Commission (2024-2029) on 18 July 2024,

    –  having regard to the EU’s 8th environment action programme,

    –  having regards to its resolution of 5 October 2022 entitled ‘Access to water as a human right – the external dimension’(18),

    –  having regard to its resolution of 19 September 2024 on the devastating floods in central and eastern Europe, the loss of lives and the EU’s preparedness to act on such disasters exacerbated by climate change(19),

    –  having regard to its resolution of 6 October 2022 on momentum for the ocean: strengthening ocean governance and biodiversity(20),

    –  having regard to its resolution of 28 November 2019 on the climate and environment emergency(21),

    –  having regard to its resolution of 14 November 2024 on the UN climate change conference in Baku, Azerbaijan (COP29)(22),

    –  having regard to the Commission report of 4 February 2025 on the implementation of the Water Framework Directive (2000/60/EC) and the Floods Directive (2007/60/EC) entitled ‘Third river basin management plans – Second flood risk management plans’ (COM(2025)0002),

    –  having regard to the European Court of Auditors special report 15/2024 of 16 October 2024 entitled ‘Climate adaptation in the EU – action not keeping up with ambition’,

    –  having regard to former Finnish President Sauli Niinistö’s report of 30 October 2024 entitled ‘Safer Together – Strengthening Europe’s civil and military preparedness and readiness’,

    –  having regard to Enrico Letta’s report of April 2024 entitled ‘Much more than a market’,

    –  having regard to its resolution of 17 December 2020 on the implementation of the EU water legislation(23),

    –  having regard to the European Court of Auditors special report 33/2018 of 18 December 2018 entitled ‘Combating desertification in the EU: a growing threat in need of more action,

    –  having regard to the European citizens’ initiative (ECI) on the right to water,

    –  having regard to its resolution of 8 September 2015 on the follow-up to the European Citizens’ Initiative Right2Water(24),

    –  having regard to UN General Assembly Resolution 64/292 of 28 July 2010, which recognises the human right to water and sanitation,

    –  having regard to the Strategic Dialogue on the future of EU agriculture,

    –  having regard to the European Court of Auditors special report 20/2024 of 30 September 2024 entitled ‘Common Agricultural Policy Plans – Greener, but not matching the EU’s ambitions for the climate and the environment’,

    –  having regard to European Environment Agency report 07/2024 of 15 October 2024 entitled ‘Europe’s state of water 2024: the need for improved water resilience’ (EEA Report 07/2024),

    –  having regard to the Environment Council conclusions of 17 June 2024 on the 8th environment action programme,

    –  having regard to European Court of Auditors special report 20/2021 of 28 September 2021 entitled ‘Sustainable water use in agriculture: CAP funds more likely to promote greater rather than more efficient water use’,

    –  having regard to the European Economic and Social Committee declaration of 26 October 2023 for an EU Blue Deal,

    –  having regard to the Commission proposal of 5 July 2023 for a directive of the European Parliament and of the Council on Soil Monitoring and Resilience (Soil Monitoring Law) (COM(2023)0416),

    –  having regard to its position at first reading of 24 April 2024 on the proposal for a directive of the European Parliament and of the Council amending Directive 2000/60/EC establishing a framework for Community action in the field of water policy, Directive 2006/118/EC on the protection of groundwater against pollution and deterioration and Directive 2008/105/EC on environmental quality standards in the field of water policy(25),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the opinion of the Committee on Agriculture and Rural Development,

    –  having regard to the report of the Committee on the Environment, Climate and Food Safety (A10-0073/2025),

    A.  whereas water is essential for life and humanity; whereas the EU has to manage current and future water resources efficiently and respond effectively to the current water challenges, as they directly affect human health, the environment and its ecosystems, strategic socio-economic activities such as energy production, agriculture and food security, and the EU’s competitiveness;

    B.  whereas water is a scarce and limited resource and, while 70 % of the earth’s surface is water-covered, available and usable fresh water accounts for only 0,5 % of water on earth(26); whereas mountains are real water towers and important freshwater reservoirs in Europe, the Alps alone providing 40 % of Europe’s fresh water(27);

    C.  whereas groundwater supplies two thirds of the EU’s drinking water and supports many ecosystems(28); whereas the services provided by freshwater ecosystems are worth over EUR 11 trillion in Europe, and provide considerable health and recreational benefits, such as from angling(29);

    D.  whereas water stress is already occurring in Europe, affecting approximately 20 % of Europe’s territory and 30 % of the population on average every year, figures that are likely to increase in the future on account of climate change(30), despite the fact that total water abstraction at the EU-27 level appeared to decrease by 15 % between 2000 and 2019; whereas the increase in the number and recurrence of extreme weather events such as droughts and floods, and the fact that they are expected to become yet more frequent in the near future, poses a risk to human life and the EU’s food sovereignty and could lead to regions in Europe becoming uninhabitable;

    E.  whereas 78 % of Europeans consider that the EU should propose additional measures to address water-related issues in Europe and 21 % of Europeans consider pollution to be the main threat linked to water in their country(31);

    F.  whereas the human right to water and sanitation was recognised as a human right in a resolution adopted by the UN General Assembly on 28 July 2010;

    G.  whereas the European Citizens’ Initiative Right2Water was the first ever to gather the required number of signatories, calling for the EU to ensure the right to water for all;

    H.  whereas the provisions of Article 14 TFEU and Protocol No 26 thereto on Services of General Interest are key elements to be prominently taken into account in all aspects of the design and implementation of the European water resilience strategy (EWRS), thus safeguarding the status of Europe’s water services as essential public services, and ensuring accessibility, equity, affordability and the maintenance of high quality standards;

    I.  whereas the Member States should follow up on the recommendations of the Commission report of November 2023(32) in order to improve water balances as the knowledge basis for making decisions about water allocation;

    J.  whereas substantive corporate value may be at risk owing to worsening water insecurity, with a decrease in the capacity of production or its complete halt as a consequence; whereas assets in water-stressed regions could become stranded, temporarily or permanently, if assumptions made about water availability and access prove inaccurate, if regulatory responses are unanticipated or if risk mitigation and stewardship plans are not put in place(33);

    K.  whereas the deadline set by the Water Framework Directive (WFD) for European rivers, lakes, transitional waters, coastal waters and groundwaters to achieve ‘good’ status was 2015, with a possible postponement to 2027 under certain conditions; whereas the objective of achieving good chemical status for all EU water bodies by 2027 remains far from being achieved, primarily due to substances such as mercury, brominated flame retardants and polycyclic aromatic hydrocarbons(34);

    L.  whereas the 2025 report on the implementation of the WFD shows that delays in meeting the WFD’s targets are not due to a deficiency in the legislation but to a lack of funding, slow implementation and insufficient integration of environmental objectives into sectoral policies; whereas analysis has shown that the Member States are not meeting the annual investment needs, which are estimated to be EUR 77 billion, with a financing gap currently estimated at around EUR 25 billion a year; whereas the report also shows the clear need for the Member States to increase their level of ambition and accelerate action to reduce the compliance gap as much as possible before 2027, to increase investment and ensure adequate financing, including via EU funds, to achieve the objectives of their programmes of measures, as well as to put in place additional measures to reduce current persistent environmental challenges to and improve transboundary cooperation;

    M.  whereas the water legislation has been evaluated as fit for purpose; whereas it establishes a framework for the protection of inland surface waters, transitional waters, coastal waters and groundwater; whereas, at the same time, it allows for less stringent environmental objectives to be achieved if socio-economic needs served by such human activity cannot be achieved by other means and it allows for a failure to achieve the objectives for water bodies if the reason for the failure is overriding public interest; whereas the legislation is proportionate and mandates the authorities of the Member States, in line with the principle of subsidiarity, to decide on the overriding public interest; whereas in some cases this may be the protection of the environment and in others a socio-economic activity;

    N.  whereas industry accounts for approximately 40 % of total water abstraction in Europe; whereas the largest categories of the annual water abstraction in the EU-27, according to the statistical classification of economic activities in the European Community (NACE), are abstraction for cooling in electricity generation (34 %), followed by abstraction for agriculture (29 %), public water supply (21 %) and manufacturing (15 %)(35); whereas data on water abstraction and use in the EU is historical and poor(36);

    O.  whereas electricity production is the largest water-abstracting sector, but most of the water is returned to the environment after cooling or turbine propulsion; whereas overall, agriculture is the highest net water-consuming sector at the EU level, as most of the water is consumed by the crop or evaporates; whereas other uses, such as industry and water utilities, abstract and consume comparatively less water, but they can represent significant pressures at a local level, especially on groundwater(37);

    P.  whereas all industrial activity requires water to produce its end products or to support production activities; whereas businesses depend on water for their daily operations, and as water scarcity increases, it can disrupt operations, raise costs and create regulatory and reputational risks;

    Q.  whereas the energy sector relies heavily on water resources; whereas this dependency poses a serious risk as water scarcity can impact energy production processes and supply security, especially where water is used as feedstock or for cooling; whereas the transition to renewable energy, particularly wind and solar energy, offers sustainable and water-efficient decarbonisation pathways and the opportunity to halt or reverse the trend of increasing water consumption;

    R.  whereas water is an essential resource for agriculture in the production of high-quality food, feed and renewable raw materials; whereas agriculture depends on water availability and irrigation helps to shield farmers from irregular rainfall and to increase the viability, yield and quality of the crops, but is a significant drain on water resources; whereas in view of climate change, changing weather patterns and increased frequency of floods and droughts, the importance of water as a resource for the production of high-quality agricultural products and of the need for water to be used efficiently will therefore be fundamental to the security of food supply and to the solutions to address water scarcity; whereas reducing pressure on surface water and groundwater from agriculture must go hand in hand with investment aimed at the use of reclaimed water and innovative desalination technologies, thereby achieving a better water balance as well as promoting clean alternative energies such as green hydrogen;

    S.  whereas global population growth requires increased food production, and the EU must guarantee food sovereignty, as laid down in Article 39 TFEU;

    T.  whereas reliable data on water accounting, that is, the systematic study of the current status and trends in water supply, demand, accessibility and use in domains that have been specified(38), is crucial for an assessment of the current situation in the EU and for European competitiveness;

    U.  whereas the potential of wastewater as an alternative water supply is underestimated, given that 60-70 % of the potential value of wastewater across the EU is currently unexploited(39) and less than 3 % of treated wastewater is reused in the EU(40); whereas there is significant potential for circular approaches to water in households, as only a small amount of the water in households is used for drinking and eating and therefore requires the highest quality standards;

    V.  whereas a very large quantity of water is lost due to obsolete or ageing water networks and the lack of necessary maintenance; whereas investment in the maintenance, improvement and development of resilient innovative irrigation infrastructures is essential for reducing and improving the efficiency of water consumption in agriculture; whereas such improvements in efficiency enable the water saved to be used for other purposes or enable the natural flow rates of watercourses to be maintained;

    W.  whereas clean and sufficient water is an essential element in implementing and achieving a real sustainable circular economy in the EU;

    X.  whereas water leakage is an underestimated global issue, which significantly exacerbates water scarcity, with an average of 23 % of treated water lost during distribution in the EU due to leaky pipes, outdated treatment facilities and insufficient reservoirs(41); whereas the revised Drinking Water Directive included measures to reduce water leakages, as well as risk assessment and management of the catchment areas for drinking water abstraction;

    Y.  whereas in 2021, 91 % of Europe’s groundwater bodies were reported as having achieved ‘good quantitative status’, while 77 % were reported as having ‘good chemical status’(42);

    Z.  whereas in 2021, only 37 % of Europe’s surface water bodies were reported as being in ‘good’ or ‘high’ ecological status, while 29 % achieved ‘good chemical status’(43);

    AA.  whereas the European Environment Agency emphasises that the proportion of surface waters failing to achieve good ecological status is uneven across Europe, and that these are more prevalent in parts of central and western Europe, and stresses that differences in water status between the Member States may be caused by different pressures, but that those differences may also result from varying approaches to monitoring and assessment(44);

    AB.  whereas the quality of surface waters across the continent reflects continuing and combined pressures, in particular diffuse pollution and the degradation of their natural flow and physical features; whereas pollution by nutrients and persistent priority substances, as well as by substances newly emerging as pollutants, continues; whereas groundwaters are affected by diffuse pollution and also suffer from intensive abstraction(45);

    AC.  whereas groundwater supplies 65 % of water for drinking and 25 % of water for agricultural irrigation in the EU(46); whereas it is a finite resource that needs to be protected from pollution and over-exploitation(47);

    AD.  whereas monitoring data from the European Environment Agency indicates widespread pollution by per- and polyfluoralkyl substances (PFAS), commonly referred to as ‘forever chemicals’, in European waters, posing significant risks to aquatic ecosystems and human health; whereas short-chain PFAS trifluoroacetic acid (TFA) has been detected in drinking water all over Europe; whereas PFAS persist in the environment, bioaccumulate in living organisms and cause adverse (eco)toxicological effects; whereas from a group of 6 000 to 10 000 individual substances, only a few have been extensively studied and their impact on human health and environment is known; whereas 99 % of PFAS remain undetected in the environment as a result of limits in monitoring;

    AE.  whereas the lack of EU-wide quality standards for PFAS in groundwater and insufficient monitoring of less-studied PFAS compounds exacerbate the challenge of achieving good chemical status for EU waters in line with the WFD and pose a substantial technical and financial burden on health systems and on water service providers while jeopardising applications of water and sewage sludge reuse;

    AF.  whereas hazardous chemicals, including heavy metals and other pollutants, released into water bodies by industrial activities, significantly impact water quality and aquatic ecosystems(48);

    AG.  whereas pharmaceutical substances are increasingly identified in surface water and groundwater; whereas pollution caused by pharmaceutical residues necessitates advanced water treatment technologies, including membrane filtration, activated carbon treatment, advanced oxidation processes and other innovative purification techniques;

    AH.  whereas Directive 2010/75/EU(49) mandates that the potential aggravation of the impact of industrial discharges on the state of water bodies due to variations of water flow dynamics should be explicitly taken into account in the granting and reviewing of permits; whereas the best available techniques will newly incorporate notions of environmental performance levels related to water and permits, which translate the use of these techniques into environmental performance limit values; whereas this is a welcome change with a potential improvement to the industry’s resilience, as EU installations may already face a lower production capacity seasonally due to water scarcity;

    AI.  whereas urban wastewater is one of the main sources of water pollution, if not properly collected and treated; whereas the objectives of the Urban Wastewater Treatment Directive should not be lowered, and its scope should be extended to other sectors and substances that contribute to water pollution;

    AJ.  whereas nutrient pollution in EU water bodies leads to eutrophication, loss of biodiversity, and degradation of aquatic ecosystems(50); whereas pesticide run-off contaminates surface water and groundwater, threatening water quality and human health;

    AK.  whereas research indicates that exposure in Europe to the synthetic chemical bisphenol A (BPA), which is used in products ranging from plastic and metal food containers to reusable water bottles, is well above acceptable health safety levels(51);

    AL.  whereas soil and nutrient management lies at the basis of improving water quality and availability; whereas the EWRS should focus on improving nutrient management, with the aim of closing nutrient loops to reduce nutrient emissions to waterways; whereas the safe use of sewage sludge in agriculture will also reduce the EU’s very high dependency on the import of phosphorus mineral fertiliser, for example, from Russia; whereas the safe use of sludge should therefore also be considered as contributing to European resilience and strategic autonomy;

    AM.  whereas climate change represents a major threat to water resources and aquatic ecosystems; whereas many impacts of climate change are felt through water, such as more intense and frequent droughts, more extreme flooding and more erratic seasonal rainfall; whereas floods and water scarcity compromise food and water security, and the health of the general population, ultimately affecting social cohesion, economic prosperity and stability, as well as jeopardising the long-term availability of this valuable resource;

    AN.  whereas the European climate risk assessment recognised that Europe’s policies and adaptation actions are not keeping pace with the rapidly growing risks that threaten ecosystems, infrastructure, food and water supply and people’s health, as well as the economy and finance(52);

    AO.  whereas assessments by the Intergovernmental Panel on Climate Change show that the sea level rise due to climate change is leading to an increase in the salinity of soils and freshwaters, compromising ecosystem health and water quality, as well as affecting 80 million Europeans living in low elevation coastal zones and flood plains; whereas freshwater and marine ecosystems are interconnected as riverine pollution, disruption to sediment flows and water shortages all have a very strong impact on the health of marine ecosystems, particularly the coastal ones, as well as on the viability of social and economic activities that depend on them, such as transport, fisheries, agriculture, aquaculture and tourism;

    AP.  whereas prolonged drought, extreme heat and large-scale flooding events, caused by changing weather patterns, will intensify and become more frequent throughout the continent, damaging ecosystems and human health and leading to major disruption to economic activities and decreasing the overall quantity and quality of available water; whereas preserving water resources and the natural functions of rivers, while supplying sufficient water of good quality, is becoming a major challenge that will require increased climate change mitigation and adaptation efforts, effective management and innovative measures to increase water availability; whereas managing water scarcity and flood risks affordably and sustainably will increasingly become important across the EU;

    AQ.  whereas in 2022, Europe experienced its hottest summer and the second warmest year on record, leading to drought impacting over 15 % of EU territory; whereas the average annual economic loss caused by droughts in the EU between1981 and 2010 was estimated at around EUR 9 billion per year; whereas with no adaptation measures, it is estimated that annual drought losses in Europe and the UK could increase to EUR 45 billion per year up to 2100 with warming of 3°C(53); whereas in the period of 1998-2020, floods comprised 43 % of all disaster events in Europe; whereas climate change impacts and socio-economic developments are leading to more frequent flooding, affecting an increasing number of people and causing increasing damage; whereas 12 % of Europe’s population lives in floodplains(54);

    AR.  whereas the cost of inaction in addressing water-related challenges is extremely high, given that 90 % of disasters are related to water(55); whereas without policy action, the cost of economic losses from coastal floods alone could exceed EUR 1 trillion per year by the end of the century in the EU(56) and the economic cost of droughts in Europe could exceed EUR 65 billion a year by 2100(57);

    AS.  whereas significant differences exist between the Member States in water availability, management strategies and usage patterns, and vulnerability to climate change impacts can vary considerably; whereas a tailored approach is required to enhance water resilience and ensure sustainable water management;

    AT.  whereas droughts constitute one of the chief catastrophic consequences of climate change; whereas around 23 % of the EU’s territory is moderately susceptible to desertification and 8 % is highly susceptible to it; whereas Hungary, Bulgaria, Spain and Italy are among the countries most affected, and 74 % of Spain’s surface area is at risk of desertification; whereas the EWRS should look beyond prolonged droughts, but rather address the reality that the semi-arid line is moving north, resulting in increasing areas in the EU that will face chronic long-term unavailability of sufficient freshwater resources;

    AU.  whereas policies related to desertification, water consumption and climate change are closely interconnected; whereas as part of the United Nations Convention to Combat Desertification, the EU reaffirmed in 2015 and later re-confirmed in 2024(58) its commitment to achieving land degradation neutrality by 2030, which, according to the European Court of Auditors special report on desertification, is unlikely to be achieved;

    AV.  whereas water infrastructure can help maintain a constant and predictable flow and supply of water; whereas in 2022, the annual average river discharge across Europe was the second lowest since records began in 1991(59);

    AW.  whereas downstream areas are particularly dependent on upstream water management and abstraction; whereas the Member States should refrain from implementing measures that significantly increase flood risks upstream or downstream of other countries in the same river basin, in accordance with the WFD;

    AX.  whereas nature-based solutions are pertinent interventions that, when tailored to specific ecosystems and needs, can increase resilience in the water cycle and provide multiple benefits in terms of biodiversity protection, carbon sequestration, improved water quality, nutrient retention, supply of drinking water, wildfire prevention and flood risk mitigation; whereas nature-based solutions can enhance the effectiveness and the operable life of water infrastructure, therefore ensuring, in many cases, complementarity of both solutions;

    AY.  whereas natural water retention measures are nature-based solutions that aim to store water in natural, agricultural, forested and urban landscapes;

    AZ.  whereas water is not a commercial product like any other but, rather, a heritage which must be protected, defended and treated as such; whereas, under Directive (EU) 2024/1203 on the protection of the environment through criminal law(60), abstraction of surface water or groundwater within the meaning of the WFD constitutes a criminal offence where such conduct is unlawful and intentional, and causes, or is likely to cause, substantial damage to the ecological status or the ecological potential of surface water bodies or to the quantitative status of groundwater bodies;

    BA.  whereas soil biodiversity and soil organic carbon affect water retention capacity; whereas soil erosion, compaction and certain soil management practices that cause soil degradation lead to a steady decrease in the water retention capacity of soil, which as a consequence exacerbates drought and flood events with a direct negative impact on farming; whereas healthy soil is therefore one of the drivers of water resilience, which itself should be approached and managed at river basin level; whereas better land management is key to preventing disasters;

    BB.  whereas the current multiannual financial framework (MFF) includes an ambitious but non-binding target of dedicating at least 7,5 % of annual EU spending to the biodiversity objectives in 2024 and 10 % in both 2026 and 2027; whereas the new financial framework should incorporate a water perspective with a view to allocating sufficient resources to the future EWRS in order to ensure resilient water ecosystems and infrastructure, and security of water supply, and to facilitate investments in innovative solutions;

    BC.  whereas cohesion funding has played a crucial role in improving water and sanitation services across the Member States; whereas continued support is required to ensure their long-term resilience and compliance with increasingly stringent quality standards;

    BD.  whereas pricing policies can improve the efficiency of water use; whereas such policies are a national competence and account for the regional differences in water availability and the source of water supply; whereas pricing can play a significant role in prompting households and other economic sectors to optimise consumption, as well as in ensuring that water users effectively participate in recovering the costs of water services; whereas pricing policies should also consider affordability for households and small businesses;

    BE.  whereas digitalisation and innovation can effectively assist the Member States, regional bodies and the Commission in collecting data on and monitoring water management; whereas the EU is at the forefront of new technological developments in the water sector, accounting for 40 % of all international patent families in this sector between 1992 and 2021(61), a position that needs to be fostered and nurtured, and the potential of the internal market fully exploited; whereas hurdles for the introduction and scaling-up of new water technologies need to be examined and a just European level playing field guaranteed; whereas continued support for research in water technology innovation is needed to secure and to create jobs and boost European competitiveness;

    BF.  whereas innovation is a crucial tool to help the water sector meet the challenges of the United Nation’s SDGs, adapt to climate change and become more water-efficient;

    BG.  whereas deployment of monitoring and modelling technologies is still lagging behind in many Member States, and the digitalisation of the sector is too slow; whereas provisions on the river basin management plans in the WFD do not explicitly include concrete measures to digitise the water sector; whereas common shortcomings for the current policies harnessing the potential digital solutions are related to the lack of technology guidance, monitoring standards, policy integration, standardisation and public involvement;

    BH.  whereas the water sector is vulnerable to various threats, including physical attacks, cyberattacks and contamination with harmful agents; whereas such incidents could result in widespread illness, casualties and service disruptions, significantly impacting public health, the environment and economic stability; whereas the digitalisation of water management might introduce further security risks in a context of increasing hostile attacks on critical infrastructure; whereas the implementation of the NIS2 Directive and Critical Entities Resilience Directive can contribute to mitigating security risks to vital (drinking) water systems and (drinking) water infrastructure, arising from geopolitical tensions;

    BI.  whereas advances in sensor technology, computing, artificial intelligence (AI) and big data management can help monitor water quantity and quality and inform the operational decisions of the policymakers and water management companies; whereas innovations in nature-based systems to manage water are available and can contribute to resilient water management;

    BJ.  whereas water is a vital component in the life cycle of AI, both in the operation of data centres and the manufacture of hardware; whereas the rapid expansion of AI could result in an exponential increase in water demand; whereas that dependency on an increasingly scarce resource poses significant challenges in terms of sustainability; whereas strategic technologies, such as semiconductors, hydrogen, electric vehicle batteries and data centres, play a key role in achieving a competitive and autonomous EU;

    BK.  whereas chiller and cooling tower systems, based on innovative cooling technologies such as evaporative and closed-loop cooling, are already available and can contribute to reducing water consumption in industrial, heating, ventilation and air conditioning systems applications;

    BL.  whereas research must be promoted with a view to producing alternative active ingredients to combat pests, to ensure greater plant health and reduce the use of inputs and phytosanitary products;

    BM.  whereas water resilience is crucial in education and teaching, and in raising awareness and giving information about the functioning of the water cycle;

    BN.  whereas limited access to water and related infrastructure has a negative impact, especially on women, as it undermines the realisation of other human rights, such as self-determination, economic independence and education;

    BO.  whereas 60 % of European river basin districts are transnational, which makes effective transboundary cooperation crucial; whereas 20 European countries depend on other countries for more than 10 % of their water resources, with five countries relying on more than 75 % of their resources coming from abroad via rivers(62); whereas this cooperation should be strengthened to account for current and future climate challenges such as droughts and floods;

    BP.  whereas United Nations Secretary-General António Guterres appointed a Special Envoy on Water, aiming to enhance international cooperation and synergies among international water processes;

    BQ.  whereas clean water access and sustainable and resilient sanitation infrastructure are key components of the One Health approach, recognising the interconnection between the health of humans and water pollution;

    BR.  whereas water cooperation across borders and sectors generates many benefits, including enhancing food security, sustaining healthy livelihoods and ecosystems, helping address resilience to climate change, contributing to disaster risk reduction, providing renewable energy, supporting cities and industry, and fostering regional integration and peace;

    BS.  whereas geopolitical developments demonstrate that the EU should be ready to withstand the challenges that go beyond the environmental sphere; whereas non-environmental threats, such as recent accidents related to the damaged cable in the Baltic Sea, send the EU a strong message that strengthening transboundary cooperation is key in addressing both the environmental and security-related objectives;

    BT.  whereas about 41 000 kilometres of inland waterways flow through 25 of the Member States; whereas inland waterways, which rely on the availability of water resources, perform a crucial role in optimising water supply and mitigating the impact of droughts and floods, as well as supporting the economic activities and the development of regions;

    BU.  whereas the increasing water scarcity, inequalities in access to water, and external shocks to the water sector have heightened interdependencies, increasing competition for water and leading to complex economic repercussions;

    General remarks

    1.  Welcomes and supports President von der Leyen’s announcement in the political guidelines for the next European Commission (2024-2029) on putting forward a European Water Resilience Strategy (EWRS) addressing water efficiency, scarcity, pollution and water-related risks, as well as the recognition that water is an indispensable resource that is increasingly under stress from climate change and increasing demands;

    2.  Believes that while implementing legislation, economic competitiveness should be taken into account in line with the Competitiveness Compass; calls for the implementation of EU environmental legislation in order to build a resilient and competitive Europe, mitigate and adapt to climate change, halt biodiversity loss, prevent pollution, ensure food security, limit resource use and waste, and strive towards efficient use of resources, including water, while taking into account the precautionary principle, the control-at-source principle and the polluter-pays principle; highlights the fact that water availability impacts the quantity, quality, variety and seasonal availability of foods that can be produced;

    3.  Calls for the EU to integrate its commitments to the COP29 Baku Dialogue on Water for Climate Action and the UN 2023 Water Conference into the international dimension of the strategy;

    4.  Stresses the urgent need to enhance water resilience and management to ensure sustainable freshwater supplies for people, the economy and the environment; emphasises that the EWRS should be developed in coordination with the European Oceans Pact, ensuring a cohesive and integrated approach to managing freshwater and ocean resources, addressing interconnected challenges, enhancing competitiveness and promoting sustainable water management across inland and marine environments, while ensuring a holistic ‘source-to-sea’ approach;

    5.  Insists on the need for a comprehensive and holistic EWRS that integrates water quality, quantity, security, infrastructure, technology and management aspects and includes the restoration of the water cycle as a key element, as it underpins economic activities, ensures resource availability and contributes to climate regulation;

    6.  Stresses the importance of water supply, in particular drinking water, as well as water security of supply; points out that all environmental restoration projects should take into account the water security aspects, prioritising solutions that not only provide environmental benefits, but also guarantee the supply and efficient management of water; emphasises, furthermore, that ecological restoration measures should be carried out in synergy with the development of the EU’s renewable energy potential and not impact the overall energy resilience;

    7.  Recommends that lakes and other freshwater-dependent habitats be included in the strategy, alongside rivers, transitional waters and groundwater, as essential components of the EU’s water resilience efforts;

    8.  Stresses the urgent need to improve crisis-warning systems with regard to heavy water incidents, as well as to improve preventive measures;

    9.  Calls on the Commission to present a European climate adaptation plan, including concrete legislative proposals and actions, particularly regarding infrastructure resilience, water management and nature-based solutions, while prioritising the protection of vulnerable communities, to make the EU more resilient and to lead by example;

    10.  Reiterates that access to clean and safe drinking water and sanitation is a human right; emphasises that this right must be unequivocally ensured, with everyone having access to affordable and good quality water services, including the inhabitants of islands and outermost regions;

    11.  Stresses that no one, whether in public places or private establishments, should be denied access to water supplied from a distribution network intended for human consumption, where available;

    12.  Notes that industrial activities and agricultural production require water to produce their end products or to support production activities, with the amount of water used varying depending on the type of activity; highlights the fact that ensuring Europe’s competitiveness and strategic autonomy requires a water-smart society where technology and data enhance a circular economy, fostering sustainable and water-efficient practices; calls on all relevant actors to accelerate the transition towards water-efficient, circular industry and agriculture by promoting and investing in innovative solutions, including digital tools and technologies, resource recovery, water reuse, renewable energy production, infrastructure, nature-based solutions and inclusive governance mechanisms;

    13.  Urges the Commission to integrate and mainstream the water dimension into internal and external EU policies through a cross-sectoral approach in order to ensure that water resilience, sustainability and security is woven into the fabric of European policies; calls on the Commission, in particular, to carry out a water-related assessment of any regulatory measure, including related to energy, as part of the socio-economic and environmental impact assessment; emphasises that assessing how each EU policy, and EU-funded projects and infrastructure, can impact water resources in terms of quantity, quality and accessibility would ensure that water resilience is a cornerstone of policy formulation and implementation, thus shifting the paradigm from treating water as an infinite resource to recognising its intrinsic value for humanity and for the EU’s ecological and socio-economic landscape and its competitiveness;

    Water efficiency

    14.  Stresses that efficient water use is essential for preserving the EU’s water resources and that water efficiency should be a key objective of the EU; calls, in this regard, for a consequential reduction in water demand, including by addressing excessive leakage levels, investing in research and innovative solutions, modernising industrial and production processes, upgrading water infrastructure, managing water resources and peak demands sustainably, prioritising uses and ensuring that higher water efficiency results in a reduction in overall freshwater consumption as well as in an increase in water availability in water-stressed areas at the local and regional levels; believes that areas affected by prolonged drought and desertification should be given priority;

    15.  Calls for a legislative framework setting sectoral water efficiency and water abstraction targets at basin level, based on up-to-date assessments of water availability and climate risks, including a water valuation approach that accounts for ecosystem services and long-term sustainability, and covering all water uses, including industry, energy, agriculture, public institutions and households; underlines the fact that these targets should be ambitious yet adaptable, taking into account the specific circumstances and progress already achieved by each Member State to ensure continued efforts towards efficiency gains across all regions; stresses the importance of efficient and uniform data collection practices across the Member States and all sectors, including through the use of innovative technologies, as well as real-time data collection points for more transparency on water consumption; emphasises the need to carry out an appropriate assessment of the environmental and socio-economic impacts of water use; stresses that the strategic importance of food production must not be compromised; emphasises that science, research and technology are important for water efficiency and water use as well as for the circular economy in this regard; calls for the creation and promotion of new smart and high-performance irrigation systems, rainwater retention and water from reuse, as well as water-efficient irrigation systems;

    16.  Reiterates the need to develop a common EU methodology for setting water efficiency and water abstraction targets to ensure the sustainable use of available renewable water resources within an integrated water resources management framework which gives due consideration to linkages beyond the water sector through the water-energy-food-ecosystems nexus, thus enabling decision-makers and economic actors to plan the necessary investment to ensure water supply security in an increasingly sustainable manner, while giving due consideration to the characteristics of the water bodies concerned;

    17.  Calls for close collaboration on integrated energy and water resource planning and related technologies across all sectors at national, regional and local levels, including between all stakeholders, in order to establish mechanisms for ensuring coherence across water and energy policies;

    18.  Calls on the Commission to put forward a comprehensive policy on sustainable water management for industry based on reducing, recovering, reusing and recycling, including a focus on the use of water-efficient and circular technologies, water recycling, pollutant reduction strategies and the promotion of closed-loop systems;

    19.  Recalls that the growing threat of water scarcity is jeopardising industries and projects that are key to Europe’s competitiveness drive, including semiconductors, data centres, renewable hydrogen and electric vehicle battery production; notes that these industries will increasingly face pressure to reduce their environmental impact and improve water resource efficiency, including both direct and indirect water usage; calls on the Member States to support water-intensive industries in setting up water-efficiency plans aimed at saving, reusing and recycling water, preventing water pollution and implementing water-efficient technologies; calls on the Commission to incorporate comprehensive water management strategies into relevant EU industrial policies and sector-specific transition pathways, with a particular focus on strategic water-intensive sectors;

    20.  Stresses that knowledge, data, research and technology are key for efficient water use; calls for adequate financial and technical support to be given to the Member States to implement efficient water management measures, including by means of innovative and modern technologies;

    21.  Welcomes the recommendations of the final report of the Strategic Dialogue on the future of EU agriculture underlining that sustainable farming practices and new business models need to be scaled up to promote more efficient use of natural resources, especially water;

    22.  Calls for the transition to a more sustainable and competitive farming model, assisted by the implementation of sustainable practices and innovative solutions that promote biodiversity, reduce chemical inputs and enable water resources to be managed efficiently, including nature-based solutions, regenerative management, smart precision irrigation technologies, digital monitoring systems, advanced treatment methods and smart water distribution networks, optimising consumption and preventing water resource depletion, and that help ensure continued productivity while enabling agriculture to reduce pollution, use pesticides and fertilisers efficiently, improve the hydrological cycle, enhance groundwater recharge and adapt to lower water use; considers that technological solutions can also include measures that can increase water absorption, infiltration and retention in agricultural systems, which are important amid increasing occurrences of both drought and heavy rains;

    23.  Points out that innovative irrigation solutions and practices can enhance water efficiency in agriculture, gaining an economic advantage while also reducing environmental burdens; notes that farmers generally lack sufficient means and incentives to know about water use by crops, actual irrigation applications, the yield responses of crops to different water management practices, and thus current on-farm water-efficiency levels; calls on the Commission and the Member States to incentivise the uptake and support the maintenance of innovative irrigation solutions such as drip irrigation to allow for an active management of water levels and efficient use of water resources, as well as to promote continuous knowledge exchange, so that all relevant stakeholders can share greater responsibility across the entire water supply chain;

    24.  Recalls that the use of nutrients such as nitrate and phosphate is essential for food production, as this activity would not be possible without their use; recommends better consideration of the nutrient cycle in agricultural production and the exploitation of the value in urban wastewater; calls for more research into the effective use of nutrients and the development of nutrient recovery technologies, in order to decrease the Union’s dependence on imported raw materials; recognises the high potential for nutrient recovery from water and calls on the Member States to support the agricultural sector to optimise their nutrient consumption including by using resources (nitrate and phosphorus) recovered from wastewater treatment plants; calls on the Commission to propose an integrated nutrient management action plan to effectively address loss of valuable agricultural inputs, recycling of nutrients, nutrient pollution and inefficiencies in the nutrient cycle; calls for the proper and safe recovery of phosphorus from organic sources and for incentivising investments in its recovery and circular nutrient management in accordance with the Commission’s JRC publication(63);

    25.  Stresses that the current Nitrates Directive is due for revision, as outdated provisions promote the use of artificial fertilisers rather than organic manure; calls for an urgent review of the Nitrates Directive before the end of this year, and its revision to promote circular nutrient management;

    26.  Emphasises, in line with the final report of the Strategic Dialogue on the future of EU agriculture, the need to support the transition to regionally adapted crop and seed varieties and the switch to different crops, with reduced water requirements and greater drought resistance, as well as the need to support the adoption of appropriate soil management practices; considers the need for stronger support for scientific research and technological development related to the breeding of new species, to enable the production and supply of foodstuffs to be diversified and their quality enhanced, while raising the level of protection for human health and the environment; notes the potential of plant varieties that are more resistant to water stress and pests and could play a role in reducing water use and could reduce the environmental footprint of crops;

    27.  Calls for financial and technical support for farmers and rural communities, particularly in water-stressed areas, to help them adopt sustainable land management practices that improve soil and water quality, contribute to biodiversity and mitigate climate change; emphasises the need for special attention to be given to regions that are particularly vulnerable to soil degradation and water scarcity;

    28.  Acknowledges the significant efforts made by farmers to enhance water quality and emphasises the need for an appropriate timeframe to allow the effects of these measures to be accurately assessed;

    29.  Points to the success of the agricultural European Innovation Partnership EIP‑AGRI and calls for the continuation of knowledge exchange, expertise and peer-to-peer learning via the EU’s Common Agricultural Policy (CAP) Network;

    30.  Notes the links between carbon sinking and water availability, and calls for coherence between the water resilience strategy and carbon farming schemes;

    31.  Reiterates that the Water Reuse Regulation aims at reducing the pressure on water bodies by setting out provisions on reusing water after appropriate treatment extends its life cycle, thereby preserving water resources; emphasises, however, that regulatory, financial and technological barriers, including the economic competitiveness of reclaimed wastewater, risk management planning and the sharing of responsibilities, contribute to the slow uptake of reuse of reclaimed water for agriculture; calls, therefore, on the Commission and the Member States to adopt supportive policies, at both the EU and the local level, that incentivise water reuse practices, taking into account the importance of adapting wastewater treatment and quality requirements to the intended water use; notes that treated wastewater also finds valuable applications in various industrial processes and urban contexts, contributing to reducing the pressure on freshwater resources and the conservation of drinking water; calls therefore on the Commission to assess a possible extension of the scope of the Water Reuse Regulation in order to establish, at EU level, minimum water quality standards for safe water reuse for industrial and urban purposes;

    32.  Calls on the Commission and the Member States to specify systems of regulatory and financial incentives for the reuse of treated wastewater in water-intensive sectors and to provide specific funding for the construction of infrastructure connecting wastewater treatment plants and refined water distribution networks; urges a streamlined approach in EU legislation to remove administrative barriers and promote safe and efficient water recycling across the Member States; calls on the Member States to set up national water reuse and saving plans to incentivise cross-sectoral cooperation in water management;

    33.  Reiterates that reused water could alleviate abstraction from rivers, lakes and groundwater for irrigated agriculture; underlines the fact that reused water can contribute to maintaining base flows and minimum water levels during dry periods;

    34.  Highlights the potential of the building sector to save water, for example, with the help of smart sub-metering systems, efficient greywater systems, reuse of domestic wastewater or rainwater harvesting; stresses that the energy performance of buildings can be enhanced by water efficiency, reducing greenhouse gas emissions; calls on the Member States and local authorities to incentivise water-saving features in new buildings; stresses, in this regard, that water-efficient practices should be factored into urban planning; highlights the fact that harvesting rain water as well as using and reusing water efficiently can improve climate adaptation in cities;

    35.  Calls for the transition, in industry and in the energy and digital sectors, to optimised cooling efficiency and alternative cooling methods that are less water-dependent, in order to ensure significant water savings in these sectors;

    36.  Points out that, while households represent 10 % of the overall water consumption in the EU, action on improving domestic water efficiency is also necessary; notes that water-saving technological solutions are readily available and can reduce water consumption in households without compromising comfort or requiring high investment; calls on the Member States to support consumers in transitioning towards such technologies and to strengthen consumer awareness of water consumption and potential efficiency gains by anchoring domestic water efficiency in water, building and consumer policies across the EU;

    37.  Notes that the leakage rates from pipes are high in some Member States, which increases the total share of domestic water consumption; welcomes the provisions of the new Drinking Water Directive on leakage rates and the ongoing work of the Commission to evaluate those rates and set threshold values that will trigger action in the Member States concerned; calls on the Member States to urgently tackle leakage in water supply networks and to fully implement the monitoring and reporting requirements of the Drinking Water Directive, so that the Commission can set a threshold value for leakage by January 2028; emphasises the need for sustainable urban irrigation networks to be modernised, to curb leakages and reduce their water footprint; calls on the Member States to regularly inform the public about the efficiency and effectiveness of their water supplies;

    38.  Points out that public sector organisations provide significant untapped potential for saving water by virtue of their size or their nature as public organisations; believes that the public sector should act as a role model for other sectors;

    39.  Calls on the Commission and the Member States to promote easily accessible and free information, training, advisory programmes and information campaigns aimed at raising public awareness of sustainable water resource management;

    40.  Recommends that water-efficiency aspects, such as reductions in water loss and reuse of water, be integrated in the upcoming revision of the public procurement framework;

    Water pollution

    41.  Underlines the fact that the existing EU water policy framework is designed to address the effective management of water resources and the protection and restoration of freshwater and marine ecosystems, but that its poor implementation and enforcement, insufficient funding and lack of proper cost-benefit analyses of the implementation measures undermine its effectiveness;

    42.  Calls on the Commission and the Member States to implement and enforce the current legislation, in particular the WFD and its ‘daughter’ directives (the Groundwater Directive and the Environmental Quality Standards Directive), with a particular focus on strengthening the monitoring and reporting mechanisms to ensure that all Member States consistently implement the required water protection measures; recalls the need for sufficient funding to implement these acts;

    43.  Stresses that the chemical pollution of surface water and groundwater poses a threat to the aquatic environment, with effects such as acute and chronic toxicity in aquatic organisms, accumulation of pollutants in the ecosystem and loss of habitats and biodiversity, as well as to human health;

    44.  Calls for the establishment of comprehensive EU-wide quality standards for PFAS in groundwater and surface water; stresses that respective updates of the relevant directives are essential for safeguarding water quality and achieving good chemical status for water bodies as mandated under the WFD;

    45.  Insists that essential uses of PFAS in critical sectors, such as medical devices, pharmaceuticals and products necessary for the twin transition to a climate neutral and digital economy, are not endangered in the context of upcoming legislative and non-legislative proposals; calls on the Commission to propose to phase out forever chemicals (PFAS) – starting with consumer goods – linked to harmful effects on human health and the environment, based on scientific evidence, allowing their use where there are no safe alternatives; underlines the need to scale up investments and accelerate the research and development of equivalent and safe alternatives;

    46.  Calls on the Commission to propose updated limits on PFAS in drinking water, taking into account the latest scientific knowledge;

    47.  Emphasises the urgency of addressing, primarily at the source, and effectively monitoring pollution from pharmaceuticals, bisphenols, antimicrobial resistance genes, persistent organic pollutants and other existing and emerging pollutants, to align with the EU’s zero pollution ambition and the goal of achieving good chemical status for all water bodies;

    48.  Calls on the Commission to close the gaps with enhanced funding and the enforcement of current laws, and the integration of circular economy principles to mitigate pollution at its source and safeguard water ecosystems for future generations; underscores the fact that antibiotic-resistant bacteria and certain emerging pollutants remain insufficiently addressed, necessitating further innovation and investment; emphasises the need for all sectors to apply sustainable production processes and circular practices, proactively preventing pollutants from entering water systems;

    49.  Recalls that microplastics may enter drinking water sources in a number of ways: from surface run-off (for example, after a rain event) to wastewater effluent (both treated and untreated), combined sewer overflows, industrial effluent, degraded plastic waste and atmospheric deposition; calls on the Commission to put forward, in line with the requirements of the Drinking Water Directive, a full risk assessment of microplastics in drinking water, while continuously working on reliable and robust sampling and analytical methods in order to appropriately address the potential threat of this emerging pollutant to sources of water intended for human consumption;

    50.  Emphasises the need to improve the monitoring and regulation of plastic pollution in freshwater and marine environments, with particular attention to microplastics and single-use plastics; encourages the Commission to assess current enforcement mechanisms and consider further measures to protect water quality;

    51.  Calls on the stakeholders to develop safe water contact materials, to substitute BPA and other bisphenols and ensure compliance with Regulation (EU) 1935/2004 on materials and articles intended to come into contact with food(64) and the recently adopted provisions as regards the use of BPA and other bisphenols and bisphenol derivatives (Commission Regulation (EU) 2024/3190);

    52.  Recalls that the revised Urban Wastewater Treatment Directive, in effect since 1 January 2025, imposes new obligations regarding water purification, requiring pharmaceutical and cosmetic producers to cover at least 80 % of the costs of removing micropollutants from wastewater, with the aim of reducing harmful substances in the environment; notes the existence of differing figures and assessments regarding the impact this would have on the pharmaceutical sector and, consequently, on the availability and affordability of medicines, and therefore calls on the Commission to conduct a new and comprehensive assessment of the impact on this sector;

    53.  Calls for increased EU support for local authorities for the modernisation of wastewater treatment plants and the promotion of water reuse, to align with the EU’s zero pollution ambition, ensuring that municipal wastewater management contributes effectively to good chemical and ecological water status;

    54.  Calls for increased monitoring of pesticide residues in water bodies and enforcement of pesticide application regulations to mitigate their impact on water quality; stresses the need for increased funding to support farmers in the adoption of low-input and organic farming practices that reduce reliance on chemical pesticides and fertilisers, as well as to provide appropriate training and independent advisory services to farmers and other operators on the use, effectiveness and toxicity of pesticides, as well as best practice;

    55.  Insists on the integration of circular economy principles to reduce hazardous chemical use in industrial processes; stresses the need for additional funding to support industries in transitioning to clean technologies that minimise water pollution(65);

    56.  Recognises the role of treated sludge as a local and circular source of fertiliser, contributing to soil health, nutrient recycling and reduced dependency on synthetic fertilisers; emphasises the importance of preventing PFAS, heavy metals, microplastics and other harmful substances from entering sewer networks in order to enable the safe and sustainable use of high-quality sewage sludge in agriculture;

    57.  Calls on the Commission to include an overview of measures in an annex to the EWRS, with a timeline for achieving the objectives in question;

    Adaptation to climate change: floods, droughts, stress areas, disaster preparedness

    58.  Calls for the climate adaptation proofing of all new EU legislative and non-legislative acts in order to ensure the integration of climate adaptation into sectoral plans and policy measures affecting water and land use; highlights, in this regard, the need for increased climate ambition as part of the fight against climate change, while urging the Member States to ensure that all climate adaptation measures affecting water use contribute to long-term, improved water resilience; calls on the Commission to take fully into account the geographical and environmental conditions in the Member States, as well as the specific situation of islands, outermost regions and other areas of high vulnerability, such as areas affected by desertification, when adopting new legislative and non-legislative proposals; asks the Commission to present a roadmap for current and ongoing legislative and non-legislative policy measures, including targets and monitoring requirements affecting water and land use;

    59.  Emphasises the need for tailored climate adaptation measures for the Mediterranean region, which faces unique challenges such as prolonged droughts and saline intrusion into freshwater resources;

    60.  Stresses the specific challenges faced by island areas due to the scarcity of drinking water and calls for targeted measures to protect island water resources, including improving rainwater collection and storage infrastructure, and implementing alternative water sources, while enhancing water resource monitoring and management systems; calls, further, on the Member States to take better account of mountainous regions in national adaptation plans in order to meet the specific challenges of water management in mountainous areas;

    61.  Reiterates that climate change mitigation and adaptation solutions should not come at the cost of ecosystem degradation, and should avoid increasing the demand for water- and energy-intensive activities, and should instead prioritise energy- and water-efficient innovation and technologies as part of moving towards a more resource-efficient economy, without undermining its productivity, while ensuring equitable access to water for all; points out that, in order to be effective, climate change mitigation and adaptation solutions should be tailored to national circumstances, while enhancing competitiveness and productivity in the short and long term; points out the possibilities of synergies, in this regard, with innovative energy production such as photovoltaics and biogas, as it can also contribute to an increase in agricultural income;

    62.  Recognises the importance of reserving water for nature and the need to maintain healthy freshwater ecosystems, for the good functioning of the water cycle, for human activities and for mitigating the impacts of droughts and water scarcity; underlines, in the context of restoring freshwater ecosystems and the natural functions of rivers, the importance of removing ‘obsolete barriers’, namely artificial barriers that no longer fulfil their original purpose or are no longer needed, wherever such opportunities exist, on the basis of current knowledge and experience; calls for the establishment of specific programmes for the cleaning and conservation of river channels, ensuring minimum flow and reducing the accumulation of debris and sediment that can affect water storage and distribution capacity;

    63.  Insists that, with climate change impact becoming more persistent, flood and drought management must fully integrate the arising risks, including changing weather patterns, such as increased rain patterns leading to excess of water; is convinced that a combination of monitoring and data collection, preparedness, emergency and recovery responses taking into account the principle of ‘building back better’(66)on the one hand, and adapting societal and economic activities on the other, is essential to reduce vulnerability and increase resilience, especially in the light of the quantitative aspect of water becoming more prominent; stresses, in this regard, the need for climate-resilient nature-based solutions and infrastructure that take into account the impact of extreme climate events in their development to ensure their viability in the face of extreme climate events;

    64.  Recalls that in 2007, the WFD was supplemented by Directive 2007/60/EC on the assessment and management of flood risks, which aims to establish a framework to reduce the adverse consequences of flooding on human health, the environment, cultural heritage and economic activity; notes that making the two directives mutually compatible is achieved through risk management plans and river basin flood management plans as the components of an integrated water management system in which coordination is crucial; recalls that flood prevention is closely connected to urban green spaces, soil protection strategies and investment in drainage networks;

    65.  Stresses that preparedness for water scarcity and drought can be significantly improved in the EU, considering that no drought management plans are in place in several Member States(67); calls on the Member States and, where applicable, competent regional and local authorities, to develop drought management plans, particularly with a view to ensuring the provision of drinking water, ensuring food production and integrating digitalised monitoring, control and early warning systems in order to support effective and data-based decisions on protection, response and communication measures with clearly defined areas of responsibility; points out the need to introduce EU-level provisions as regards drought management plans, similar to the ones on flood management plans;

    66.  Insists, in view of the numerous climatic events, such as floods, droughts and cyclones, which have affected Europe, on the importance of the EU having a robust mechanism for responding to such crises, including systems for warning and providing assistance to the civilian population; points out that digital monitoring, adequate public display of relevant data and early warning systems are key to developing effective drought and flood management plans at the level of the Member States; emphasises, further, the importance of fully using the available EU tools, such as the flood forecasts of the European Flood Awareness System and the Global Flood Awareness System, and the Global Flood Monitoring tool, as part of the Copernicus Emergency Management Service;

    67.  Stresses the importance of the Union Civil Protection Mechanism (UCPM) in helping countries hit by water-related disasters such as flood and droughts; calls for increased funding to provide the UCPM with sufficient and upgraded resources in order to increase preparedness and improve capacity building;

    68.  Calls on the Commission and the Member States to enhance citizen preparedness in the event of water-related disasters or crisis; stresses the importance of information campaigns and demonstration exercises in education facilities, public administration and businesses in order to build a ‘preparedness culture’ for citizens;

    69.  Calls on the Member States to systematically renew and upgrade their water infrastructure, including drinking water and sanitation infrastructure, as well as infrastructure regulating river flows, and to invest in innovative solutions based on good practice, making water systems more resilient to climate change, ensuring stable drinking water supply, enabling the early detection of losses and reducing water leakages and waste, while optimising water transport and storage systems; highlights the fact that funding for innovative water infrastructure is insufficient compared to the investment needs across the EU; calls, in this regard, for dedicated funding, on national, regional or EU level, to ensure adequate financing for the development, maintenance and modernisation of water-resilient infrastructure, to foster innovative solutions and technologies and ensure long-term sustainability of that water infrastructure;

    70.  Regrets that, despite the threat that desertification poses to water quality and availability, soil fertility and food production, and despite the fact that 13 Member States have declared themselves to be affected by desertification in the context of the United Nations Convention to Combat Desertification, the Commission is not addressing desertification effectively and efficiently; urges the Commission, therefore, in line with the Council conclusions of 14 October 2024 on desertification, land degradation and drought, to present an integrated EU-wide action plan to combat desertification, land degradation and drought, aiming at building resilience to drought and achieving land degradation neutrality in the EU by 2030, based on a full impact assessment;

    71.  Insists that the agricultural sector be further supported in implementing new technologies to reduce the demand for water, while at the same time increasing access to water, including by supporting water retention and groundwater recharge; calls for research results, for example on seawater desalination, to be made accessible and to facilitate the deployment of innovative desalination solutions; calls on the Member States to create natural water reserves based on up-to-date assessments of climate risks to protect critical water supplies and their catchments, and taking into consideration the environmental and socio-economic impact of developing such reserves; points out that such natural water reserves would complement the WFD’s requirement for Member States to identify water bodies used for drinking water abstraction, making sure they meet the objectives set out in Article 4 WFD and in the Drinking Water Directive, and would ensure their necessary protection; notes that such natural water reserves already exist under different forms in various Member States; stresses that assistance should be given to Member States or local and regional governments to help them develop natural water reserves;

    72.  Notes the potential of retention infrastructure as an example of water generation systems created using the best available, cost-effective techniques that have the lowest environmental impact, including by means of wastewater reuse or rainwater collection, in order to reduce the risks of droughts and floods, increase water security and foster circularity, water reclamation and reuse; believes that water retention facilities may be useful tools provided that they are authorised by local or national authorities under clear conditions, including the capacity of local groundwater to sustain such activities and the need for farmers accessing the water resource to adapt their practices to more sustainable practices, in particular in terms of water needs and water quality; calls on the Commission to use its available tools, including financial support, to streamline this approach among the Member States;

    73.  Deplores the unlawful or intentional abstraction of water, which is likely to cause substantial damage to water bodies; calls for strong dissuasive measures to be applied, including through the criminal law, to protect the ecological status or the ecological potential of surface water bodies or of the quantitative status of groundwater bodies; notes that additional support for training and knowledge transfer for national enforcement capacities is needed;

    74.  Notes the important cross-cutting role of nature-based solutions in addressing the challenges of the triple planetary crisis and restoring the natural water cycle; calls on the Commission and the Member States to prioritise, taking into account the environmental and socio-economic impacts, the deployment of nature-based solutions for water resilience in their policy actions and recommendations, such as the re-wetting of wetlands and peatlands to increase ground water availability and surrounding soil moisture, the restoration and protection of floodplains, natural water retention measures, revegetation as a barrier against floods, and rainwater conservation, in order to strengthen water availability, mitigate climate change risks and support long-term resilience for communities, businesses and food production; underlines that, in addition to nature-based solutions, complementary investment in engineering solutions remains necessary to ensure successful climate adaptation and water resilience in the long term;

    Funding and pricing

    75.  Notes that nature-based solutions and natural water retention measures have the potential to restore groundwater levels and support ecological flows while reducing water-related risks from water scarcity, floods and droughts; notes that in flood management, nature-based solutions cannot usually replace existing solutions and may not be effective for the most extreme events; points out, however, that nature-based solutions can enhance the effectiveness and operable life of grey infrastructure by increasing water absorption capacity, reducing water velocity and regulating peak flows; reiterates, in this regard, that the effectiveness of nature-based solutions is context-specific and must be adapted to the local situation; emphasises in this regard that a ‘one solution that fits all’ does not exist;

    76.  Stresses the need to provide financial support for sustainable innovative methods and solutions, while having due regard to public-private partnerships;

    77.  Stresses, in the context of climate adaptation, the importance of healthy soils in ensuring water security and circularity; emphasises that the natural water retention of soils must be improved through measures to enhance soil health, minimising carbon losses, as well as actions at the level of the water body, such as the stabilisation of riverbanks, including through re-naturalisation, and the restoration of the retention capacities of aquifers;

    78.  Notes that thoroughly designed forest management measures can improve watershed health, regulate water flow and reduce drought and flood stress, given the essential role of trees and forests in water cycle regulation, through their ability to purify water, increase the availability of water resources and improve soil moisture retention; proposes that this be duly considered when the Commission, in cooperation with the Member States, develops Union disaster resilience goals and that it be considered in the development and refinement of disaster risk management and contingency planning; highlights the need, in this regard, for more research, data collection, innovation and funding to support land managers in preventing the impact of environmental stressors such as drought floods and diminishing watershed function;

    79.  Recognises that urban areas are increasingly vulnerable to water-related climate risks such as flooding, water shortages and heat stress; calls for the integration of urban water resilience planning into climate adaptation strategies, including investment in green roofs, permeable infrastructure, rainwater harvesting and storm water retention systems, as well as measures aimed at increasing green and blue spaces in urban areas, in order to mitigate extreme weather impacts and to reduce the risks to human life and property; calls further for the maintenance of, and regained access to, urban waterways in cities;

    80.  Emphasises that the EWRS should ensure adequate funding from public and private sources in order to support the modernisation, upgrading, adaptation and maintenance of resilient water infrastructure, sustainable water management, data collection, research, effective monitoring, digitalisation, upskilling, nature-based solutions, the development and the uptake of innovative water-efficient technologies, as well as to ensure environmental and socio-economic sustainability in line with the goals set by the new European Competitiveness Compass;

    81.  Calls on the Commission to create a separate and dedicated fund for water resilience within the upcoming MFF; believes that specific financial mechanisms should also be established within the European Regional Development Fund and the Cohesion Fund to support water-smart technologies and water investment; strongly believes that, in the interim, water should be prioritised in existing funding frameworks, including the Cohesion Fund; stresses that EU funding mechanisms must incorporate considerations of social equity and affordability, in particular in the context of providing water services to the population, ensuring support for Member States and citizens with greater financial constraints and specific realities, while meeting water management obligations; highlights the importance of adjusting existing funding, subsidies and financing streams related to water management and other related land uses, moving away from outdated engineering solutions to innovative ones, as well as nature-based solutions or a combination thereof;

    82.  Calls for targeted funding, via Horizon Europe and the EIP-AGRI, for field trials on the water relations of different cropping systems; calls for the recognition of the role of women in water policies and for specific funding to be identified to promote their access to agriculture;

    83.  Recalls that the lack of dedicated funding for water or binding funding targets within the current MFF limits the EU’s capacity to direct targeted investment towards essential water resilience measures, including infrastructure modernisation, innovation, climate adaptation measures and the implementation of nature-based solutions, and thus its competitive capacity, as the absence of a water balance creates an additional burden for the economy of the regions; notes that outermost and mountainous regions and islands in the EU are particularly struggling to access funding or public-private partnerships to support local and regional investment in water management and infrastructure;

    84.  Stresses the important role of the European Investment Bank (EIB) in water financing; highlights the fact that the EIB is actively investing in and supporting the water sector; stresses that the EU should collaborate with the EIB to share best practice and calls, further, on the EIB and other financial institutions to strengthen their role in the funding of innovative and resilient water infrastructure, improved sanitation and drinking water infrastructure, digitalisation, as well as to support projects aimed at flood risk reduction, erosion prevention and the revitalization of watercourses, by facilitating favourable conditions for water investment;

    85.  Urges the Commission to explore and promote innovative financing mechanisms, including payments for ecosystem services and green bonds, while ensuring regulatory clarity and safeguards to prevent market distortions; calls on the EIB and other financial institutions to prioritise low-interest loans and credits for Member States and regional and local authorities undertaking large-scale restoration projects, with specific provisions to support economically disadvantaged regions;

    86.  Highlights the importance of public-private partnerships as a source of funding for water investment; calls on the Commission to incentivise private investment in the water sector by creating a supportive regulatory framework that may include co-financing opportunities and public-private partnerships in order to drive innovation, improve infrastructure and ensure sustainable water management solutions across the Member States; underlines, nevertheless, that the involvement of private investment in the EU water sector must not undermine the status of water as a public good and a public service, and that the long-term resilience of the sector, as well as the principles of accessibility, affordability and sustainability must be ensured;

    87.  Calls on the Member States to adopt governance frameworks that clearly define the roles and responsibilities of stakeholders in planning, financing and implementing nature-based solutions; believes that these frameworks should integrate funding from diverse sources, including philanthropic contributions and private-sector partnerships, while ensuring equitable access to resources for small-scale projects, particularly managed at local or regional levels;

    88.  Urges the Commission and the Member States to address water aspects in their budgets and to improve governance within the regions in the use of EU funds;

    89.  Underlines the need to provide targeted financial and technical assistance to municipalities to facilitate compliance with water-related legislation;

    90.  Encourages the Member States to accelerate the granting of authorisations for sustainable and innovative resilient water infrastructure projects to enable their rapid implementation in the face of the urgent challenges;

    91.  Notes that the application of the cost recovery principle on water services, which provides that all water users effectively and proportionately participate financially in the recovery of the costs of water services, remains low to non-existent in several Member States; calls on the Member States and their regional authorities to implement adequate water pricing policies and apply the cost recovery principle for both environmental and resource costs in line with the WFD; calls on the Member States to take into account the long investment cycles when implementing the cost recovery principle and to ensure sufficient funding is available for needed (re)investment;

    92.  Stresses the importance of ensuring that water pricing supports long-term water security by reflecting the economic, environmental and resource costs of water use; encourages the Member States and competent regional and local authorities to ensure that water pricing is economically sustainable, socially fair and promotes efficient water use, and that it reflects the availability of water across different Member States and regions, particularly in water-stressed regions, while safeguarding affordability for households and small businesses; calls on the Member States and competent regional and local authorities to insure transparent water prices and to raise awareness of the value of water services;

    93.  Points out that competent national water authorities will play a central role in implementing new water management and conservation plans at the level of the Member States; calls, therefore, on the Members States to financially and technically increase the capacity of those competent authorities to play a more significant enabling and advisory role in sustainable and future-proof water management and storage infrastructure; believes that EU funds, such as the Just Transition Fund, should be used to further assist Member States and water agencies in implementation;

    Digitalisation, security and technological innovation

    94.  Stresses the potential and the necessity for digitalisation and AI in improving the management and monitoring of bodies of water and water infrastructure, as well as in reporting and ensuring the comparability of data reflecting different geographical flow conditions;

    95.  Calls on the Commission, the Member States and water providers to mainstream transparency and digitalisation as fundamental principles in water management and to enhance the use of management and metering data, with the aim of strengthening monitoring, assessment, accountability and decision-making, while optimising and simplifying reporting obligations; calls for digitally enabled water technologies to facilitate real-time, sample-based and distance monitoring and reporting on water quality, leakages, usage and resources; calls for improved efficiency in the use of public funds and public spending in this area; recognises that widespread deployment of innovative digital technologies needs to be accompanied by digital skills training;

    96.  Emphasises the need to promote digitalisation and data-centric solutions in building a water-smart society; stresses the need to develop digital solutions for monitoring water consumption and optimising the use of water resources across all sectors; calls on the Commission, in cooperation with the Member States, to provide financial support for the implementation of smart water management systems, focusing on the needs of small and medium-sized enterprises (SMEs);

    97.  Points out that water systems, including water treatment and distribution systems, are considered one of the nation’s critical infrastructures and security pillars, and hence key for the EU’s strategic autonomy, and require increased protection and the ability of utilities to detect, respond to, and recover from physical and cyberthreats and cyberattacks; notes that a higher level of digitalisation comes with new vulnerabilities; points out that, in the event of a threat or an attack, water system operators can lose their ability to control the flow and quality of the water or lose the ability to track the true status of the water system; insists that vulnerability assessments and an emergency response plan should be an integral part of the water management system in every Member State; encourages the promotion of information sharing about threats to cybersecurity and procedures to exchange best practice among operators, as well as to establish a cybersecurity culture through technical security measures, competence building and awareness creation and communication; draws attention to the measures and provisions in the NIS2 Directive and the Critical Entities Resilience Directive which could help mitigate the arising security risks; calls on the Commission to take the lead in reinforcing the EU-level coordination formats and to propose effective tools in the upcoming Preparedness Union Strategy with the aim of ensuring timely preparedness to tackle environmental and non-environmental risks to the water bodies that are threatening the EU’s overall security;

    98.  Calls on the Commission and the Member States to increase the involvement of women in decisions regarding water resilience; calls for the adoption of a methodological approach that effectively considers gender-related needs in the implementation of water supply projects, by implementing monitoring, reporting and tracking that use tools and indicators disaggregated by gender;

    99.  Notes that better data and data analysis are key to evidence-based decision-making and the swift identification of small changes in water quality that could present a threat to bodies of water, together with the evaluation of best practice and identification of the most cost-effective and impactful measures;

    100.  Stresses that improved, reliable and interoperable data on water supply, demand, distribution, accessibility and use are needed and that data points need to be established; urges the Commission and the Member States to enhance data collection and improve data interoperability across all levels to support the implementation of current water legislation, as well as to facilitate circular economy and water-smart industrial symbiosis strategies; highlights the fact that data and AI could be used in modelling water and energy consumption as well as reuse and recycling capacities;

    101.  Calls on the Commission to better recognise the fundamental role of the water sector in bolstering EU competiveness by fostering research and innovation and promoting entrepreneurship and talent; emphasises, in this regard, the importance of ramping up innovation in the water sector; points out that the European Innovation Centre for Industrial Transformation and Emissions, created as part of Directive 2010/75/EU, could play a role in this regard, as it evaluates the environmental performance of industrial technologies and gathers information on innovative industrial environmental techniques; points, further, to existing partnerships like the Water4All Partnership, a funding programme for scientific research;

    102.  Believes that there is a need to build and nurture multi-stakeholder platforms to promote innovation uptake at all levels, local and national; recommends that these platforms involve a wide range of participants – the public and private sectors, and civil society associations – to build a coalition of partners to bring about change; supports the promotion of knowledge sharing on how digital water technologies can support the implementation of existing EU water legislation, as well as capacity building at local, regional and national levels; calls on the Commission and the Members States to expand digital skills, and research and development (R&D) programmes targeting water, including through collaboration with universities, research centres and SMEs;

    103.  Acknowledges the critical role of data centres in the digital economy; notes with concern that the rapid expansion of the technology could lead to a substantial increase in AI’s demand for water resources associated with their operations, which could undermine the environmental benefits that AI promises to deliver, such as resource optimisation and carbon emission reductions, and stresses the need to integrate water efficiency measures in their design and operation; urges the Commission to address the use of water resources by information and communications technologies (ICT) and, in particular, by AI and data centres in its EWRS, in particular by encouraging data centres to reuse treated water and to promote the design of more efficient chips and components to reduce the need for cooling; recommends that the Member States prioritise water resilience strategies that address the specific challenges posed by data centres to ensure the sustainability of both the digital and the environmental agendas;

    104.  Recalls that seawater desalination is the process of removing salt from sea or brackish water to make it useable for a range of ‘fit for use’ purposes, including drinking, and that it is thus an important technological solution for people’s livelihoods; notes that, at the same time, desalination is an energy-intensive process and should ideally be done using renewable energy, whenever possible, in order to minimise environmental impacts; reiterates that desalination produces a by-product, brine (a concentrated salt solution), that must be properly disposed of to avoid adverse impacts on the marine environment; considers, therefore, that desalination based on reverse osmosis or thermal technologies should be applied, if other more environmentally sustainable options are not available or cannot be implemented, particularly in remote areas and islands; highlights, in this regard, the ongoing work on new technological solutions, such as microbial desalination cells, offering an environmentally sustainable and innovative alternative to traditional desalination methods, particularly to provide clean water and wastewater treatment to small, isolated locations without electricity;

    105.  Stresses the need for increased funding and R&D into technologies such as innovative desalination techniques in order to increase the efficiency, sustainability and the scaling up of such technologies; calls for research into the possibilities of using such technologies in agriculture to diversify the water supply points and therefore decrease the vulnerability of the sector to water stress;

    106.  Notes that in the last decade, there have been many scientific breakthroughs for making water treatment smarter and more circular, with these solutions offering opportunities for using digital solutions, AI and remote sensing to use water more efficiently and by reusing treated wastewater for irrigation and recovering energy and nutrients from wastewater;

    107.  Calls on the Commission and the Member States to address the regulatory obstacles within the single market to facilitate the development, scaling-up, and placing on the market of innovative biotechnology and biomanufacturing solutions and the promotion of cleaner manufacturing and circularity;

    108.  Calls for the funding, development and authorisation of innovative solutions for crop protection and fertilisation, including biological control agents and active substances with lower impact on the environment, which are needed for a just transition to more sustainable agricultural systems;

    109.  Calls for specific programmes to be established for the cleaning and conservation of river channels, ensuring adequate flow and reducing the accumulation of debris and sediment that can affect water storage and distribution capacity;

    Cross-border and international cooperation

    110.  Stresses the need for a comprehensive EWRS that fosters cross-border cooperation, more uniform data collection and reporting, sharing best practice between local, regional and national actors, ensuring sustainable water management and equitable resource distribution among the Member States, preventing water challenges such as scarcity and flood risk from being passed on to other Member States;

    111.  Emphasises that climate change represents a major threat to water resources and aquatic ecosystems; notes that floods and water scarcity compromise food and water security and the health of the general population, ultimately affecting social cohesion and stability; recognises that water resilience is crucial for preventing and addressing current and future health, food, energy and security crises; emphasises that water resilience promotes transboundary water cooperation, serving as a catalyst for peace and security, as countries are interconnected through shared rivers and groundwater resources;

    112.  Calls for increased cross-border cooperation between the Member States in the management of shared river basins and groundwater aquifers and in the effective collection and sharing of data on water quality, pollution levels and water levels; recommends the establishment of regional cooperation centres to coordinate the implementation of joint water resilience strategies, taking into account the climate, social and economic challenges of each territory;

    113.  Calls for enhanced international cooperation, including at the level of river basins, to address the growing water crisis, ensure clean and high-quality water, promote sustainable water management and implement various innovative water technologies, including nature-based solutions; calls for the anchoring of cooperation across borders at operational, tactical and strategic levels;

    114.  Calls for the establishment of cross-border projects under Interreg and other EU funds to improve regional cooperation in the management of water resources, with a particular focus on ensuring the fair distribution of water between sectors and Member States;

    115.  Stresses the need to strengthen EU monitoring capacities through digitalisation and modern technologies, including satellite surveillance and real-time pollution tracking, which are essential for preventing and combating cross-border pollution;

    116.  Urges the Commission to implement a specific diplomatic role dedicated to resolving water-related conflicts, promoting water cooperation and protecting water sources and systems, particularly during armed conflicts and in transboundary contexts;

    117.  Urges the EU to lead international efforts to protect and restore water ecosystems in line with the SDG 6 on clean water and sanitation;

    o
    o   o

    118.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 243, 9.7.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/1119/oj.
    (2) OJ L 327, 22.12.2000, p. 1, ELI: http://data.europa.eu/eli/dir/2000/60/oj.
    (3) OJ L 372, 27.12.2006, p. 19, ELI: http://data.europa.eu/eli/dir/2006/118/oj.
    (4) OJ L 348, 24.12.2008, p. 84, ELI: http://data.europa.eu/eli/dir/2008/105/oj.
    (5) OJ L 288, 6.11.2007, p. 27, ELI: http://data.europa.eu/eli/dir/2007/60/oj.
    (6) OJ L 435, 23.12.2020, p. 1, ELI: http://data.europa.eu/eli/dir/2020/2184/oj.
    (7) OJ L 177, 5.6.2020, p. 32, ELI: http://data.europa.eu/eli/reg/2020/741/oj.
    (8) OJ L 164, 25.6.2008, p. 19, ELI: http://data.europa.eu/eli/dir/2008/56/oj.
    (9) OJ L, 2024/3019, 12.12.2024, ELI: http://data.europa.eu/eli/dir/2024/3019/oj.
    (10) OJ L, 2024/1785, 15.7.2024, ELI: http://data.europa.eu/eli/dir/2024/1785/oj.
    (11) OJ L 375, 31.12.1991, p. 1, ELI: http://data.europa.eu/eli/dir/1991/676/oj.
    (12) OJ L, 2024/1991, 29.7.2024, ELI: http://data.europa.eu/eli/reg/2024/1991/oj.
    (13) OJ L 333, 27.12.2022, p. 164, ELI: http://data.europa.eu/eli/dir/2022/2557/oj.
    (14) OJ L 333, 27.12.2022, p. 80, ELI: http://data.europa.eu/eli/dir/2022/2555/oj.
    (15) OJ L 309, 24.11.2009, p. 71, ELI: http://data.europa.eu/eli/dir/2009/128/oj.
    (16) OJ L 435, 6.12.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/2115/oj.
    (17) OJ L, 2024/3190, 31.12.2024, ELI: http://data.europa.eu/eli/reg/2024/3190/oj.
    (18) OJ C 132, 14.4.2023, p. 54.
    (19) OJ C, C/2024/7216, 10.12.2024, ELI: http://data.europa.eu/eli/C/2024/7216/oj.
    (20) OJ C 132, 14.4.2023, p. 106.
    (21) OJ C 232, 16.6.2021, p. 28.
    (22) OJ C, C/2025/808, 11.2.2025, ELI: http://data.europa.eu/eli/C/2025/808/oj.
    (23) OJ C 445, 29.10.2021, p. 126.
    (24) OJ C 316, 22.9.2017, p. 99.
    (25) Texts adopted, P9_TA(2024)0358.
    (26) World Meteorological Organization, 2021 State of Climate Services – Water, WMO-No 1278, WMO, Geneva, 2021.
    (27) European Environment Agency, Water resources across Europe – confronting water scarcity and drought, EEA Report 2/2009.
    (28) EEA Report 07/2024.
    (29) WWF, High Cost of Cheap Water, WWF, Gland, 2021.
    (30) EEA Report 07/2024.
    (31) European Commission, Attitudes of Europeans towards the environment, Special Eurobarometer 550, May 2024.
    (32) European Commission: Directorate-General for Environment, et al., Implementation of water balances in the EU – Final report, Publications Office of the European Union, 2024.
    (33) Disclosure Insight Action (CDP) and Planet Tracker, High and Dry. How Water Issues Are Stranding Assets, 2022.
    (34) EEA Report 07/2024.
    (35) European Environment Agency, ‘Water abstraction by economic sector in the 27 EU Member States, 2000-2022’, European Environment Agency website, 5 December 2024, https://www.eea.europa.eu/en/analysis/indicators/water-abstraction-by-source-and/water-abstraction-by-economic?activeTab=8a280073-bf94-4717-b3e2-1374b57ca99d.
    (36) Eurostat, ‘Archive: Water use in industry’, Eurostat website, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Archive:Water_use_in_industry&oldid=196132#Further_Eurostat_information.
    (37) EEA Report 07/2024.
    (38) Food and Agriculture Organization of the United Nations, Water accounting and auditing, A sourcebook, FAO Water Reports 43, FAO, Rome, 2016.
    (39) European Investment Bank, Wastewater as a resource, EIB, 2022.
    (40) European Commission: Directorate-General for Environment, ‘Water reuse: New EU rules to improve access to safe irrigation’, European Commission website, 26 June 2023, https://environment.ec.europa.eu/news/water-reuse-new-eu-rules-improve-access-safe-irrigation-2023-06-26_en.
    (41) European Commission: Directorate-General for Environment, ‘Zero pollution: Improved quality and access to drinking water’, European Commission website, 12 January 2023, https://environment.ec.europa.eu/news/improved-quality-and-access-drinking-water-all-europeans-2023-01-12_en.
    (42) EEA Report 07/2024.
    (43) Ibid.
    (44) Ibid.
    (45) Ibid.
    (46) Ibid.
    (47) Ibid.
    (48) European Environment Agency, ‘Industrial pollutant releases to water in Europe’, European Environment Agency website, 30 May 2024, https://www.eea.europa.eu/en/analysis/indicators/industrial-pollutant-releases-to-water.
    (49) Directive 2010/75/EU of the European Parliament and of the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control) (OJ L 334, 17.12.2010, p. 17, ELI: http://data.europa.eu/eli/dir/2010/75/oj).
    (50) European Commission ‘Nitrates’, European Commission website, https://environment.ec.europa.eu/topics/water/nitrates_en#implementation.
    (51) European Environment Agency, ‘Public exposure to widely used Bisphenol A exceeds acceptable health safety levels’, European Environment Agency website, 14 September 2023, https://www.eea.europa.eu/en/newsroom/news/public-exposure-to-bisphenol-a.
    (52) European Environment Agency, European Climate Risk Assessment, EEA Report 01/2024.
    (53) Cammalleri, C. et al., Global warming and drought impacts in the EU, JRC Technical Report , Publications Office of the European Union, Luxembourg.
    (54) EEA Report 07/2024.
    (55) Feyen, L. et al., Climate change impacts and adaptation in Europe, JRC PESETA IV final report, Publications Office of the European Union, Luxembourg.
    (56) European Environment AgencyEuropean Climate Risk Assessment, EEA Report 01/2024.
    (57) United Nations Office for Disaster Risk Reduction, GAR Special Report on Drought 2021, Geneva, UNDRR, 2021.
    (58) Council conclusions of 14 October 2024 on Desertification, Land Degradation and Drought.
    (59) EEA Report 07/2024.
    (60) Directive (EU) 2024/1203 of the European Parliament and of the Council of 11 April 2024 on the protection of the environment through criminal law and replacing Directives 2008/99/EC and 2009/123/EC (OJ L, 2024/1203, 30.4.2024, ELI: http://data.europa.eu/eli/dir/2024/1203/oj).
    (61) European Patent Office, Innovation in water-related technologies, EPO, Munich 2024.
    (62) EEA Report 07/2024.
    (63) European Commission JRC Science for Policy Report, ‘Technical proposals for the safe use of processed manure above the threshold established for Nitrate Vulnerable Zones by the Nitrates Directive (91/676/EEC)’, 2020.
    (64) Regulation (EC) No 1935/2004 of the European Parliament and of the Council of 27 October 2004 on materials and articles intended to come into contact with food and repealing Directives 80/590/EEC and 89/109/EEC (OJ L 338, 13.11.2004, p. 4, ELI: http://data.europa.eu/eli/reg/2004/1935/oj).
    (65) European Environment Agency,‘Industrial pollutant releases to water in Europe, European Environment Agency website, 30 May 2024, https://www.eea.europa.eu/en/analysis/indicators/industrial-pollutant-releases-to-water.
    (66) United Nations Office for Disaster Risk Reduction, Build Back Better in recovery, rehabilitation and reconstruction, UNISDR, Geneva, 2019.
    (67) European Commission: Directorate-General for Environment et al. Stock-taking analysis and outlook of drought policies, planning and management in EU Member States – Final Report, Publications Office of the European Union, 2023.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – A revamped long-term budget for the Union in a changing world – P10_TA(2025)0090 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to Articles 311, 312, 323 and 324 of the Treaty on the Functioning of the European Union (TFEU),

    –  having regard to Council Regulation (EU, Euratom) 2020/2093 of 17 December 2020 laying down the multiannual financial framework for the years 2021 to 2027(1) and to the joint declarations agreed between Parliament, the Council and the Commission in this context and the related unilateral declarations,

    –  having regard to Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European Union and repealing Decision 2014/335/EU, Euratom(2),

    –  having regard to the amended Commission proposal of 23 June 2023 for a Council decision amending Decision (EU, Euratom) 2020/2053 on the system of own resources of the European Union (COM(2023)0331),

    –  having regard to the Interinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources(3) (the IIA),

    –  having regard to Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council of 23 September 2024 on the financial rules applicable to the general budget of the Union (recast)(4) (the Financial Regulation),

    –  having regard to Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council of 16 December 2020 on a general regime of conditionality for the protection of the Union budget(5) (the Rule of Law Conditionality Regulation),

    –  having regard to its position of 27 February 2024 on the draft Council regulation amending Regulation (EU, Euratom) 2020/2093 laying down the multiannual financial framework for the years 2021 to 2027(6),

    –  having regard to its resolution of 10 May 2023 on own resources: a new start for EU finances, a new start for Europe(7),

    –  having regard to its resolution of 15 December 2022 on upscaling the 2021-2027 multiannual financial framework: a resilient EU budget fit for new challenges(8),

    –  having regard to its position of 16 December 2020 on the draft Council regulation laying down the multiannual financial framework for the years 2021 to 2027(9),

    –  having regard to the Interinstitutional Proclamation on the European Pillar of Social Rights of 13 December 2017(10) and to the Commission Action Plan of 4 March 2021 on the implementation of the European Pillar of Social Rights (COM(2021)0102),

    –  having regard to the Agreement adopted at the 15th Conference of the Parties to the Convention on Biological Diversity (COP 15) in Montreal on 19 December 2022 (Kunming-Montreal Global Biodiversity Framework),

    –  having regard to the Agreement adopted at the 21st Conference of the Parties to the UNFCCC (COP 21) in Paris on 12 December 2015 (the Paris Agreement),

    –  having regard to the United Nations Sustainable Development Goals,

    –  having regard to the report of 30 October 2024 by Sauli Niinistö entitled ‘Safer together – strengthening Europe’s civilian and military preparedness and readiness’ (the Niinistö report),

    –  having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’ (the Draghi report),

    –  having regard to the report of 4 September 2024 of the Strategic Dialogue on the Future of EU Agriculture entitled ‘A shared prospect for farming and food in Europe’,

    –  having regard to the report of 17 April 2024 by Enrico Letta entitled ‘Much more than a market – speed, security, solidarity: empowering the Single Market to deliver a sustainable future and prosperity for all EU Citizens’ (the Letta report),

    –  having regard to the report of 20 February 2024 of the High-Level Group on the Future of Cohesion Policy entitled ‘Forging a sustainable future together – cohesion for a competitive and inclusive Europe’,

    –  having regard to the Budapest Declaration on the New European Competitiveness Deal,

    –  having regard to the joint communication of 26 March 2025 entitled ‘European Preparedness Union Strategy’ (JOIN(2025)0130),

    –  having regard to the joint white paper of 19 March 2025 entitled ‘European Defence Readiness 2030’ (JOIN(2025)0120),

    –  having regard to the Commission communication of 7 March 2025 entitled ‘A Roadmap for Women’s Rights’ (COM(2025)0097),

    –  having regard to the Commission communication of 26 February 2025 entitled ‘The Clean Industrial Deal: a joint roadmap for competitiveness and decarbonisation’ (COM(2025)0085),

    –  having regard to the Commission communication of 19 February 2025 entitled ‘A Vision for Agriculture and Food’ (COM(2025)0075),

    –  having regard to the Commission communication of 11 February 2025 entitled ‘The road to the next multiannual financial framework’ (COM(2025)0046),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’ (COM(2025)0030),

    –  having regard to the Commission communication of 9 December 2021 entitled ‘Building an economy that works for people: an action plan for the social economy’ (COM(2021)0778),

    –  having regard to the European Council conclusions of 20 March 2025, 6 March 2025 and 19 December 2024,

    –  having regard to the political guidelines of 18 July 2024 for the next European Commission 2024-2029,

    –  having regard to the opinion of the Committee of the Regions of 20 November 2024 entitled ‘EU budget and place-based policies: proposals for new design and delivery mechanisms in the MFF post-2027’(11),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Budgetary Control, the Committee on Economic and Monetary Affairs, the Committee on Employment and Social Affairs, the Committee on the Environment, Climate and Food Safety, the Committee on Industry, Research and Energy, the Committee on Internal Market and Consumer Protection, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Agriculture and Rural Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Constitutional Affairs, and the Committee on Women’s Rights and Gender Equality,

    –  having regard to the report of the Committee on Budgets (A10-0076/2025),

    A.  whereas, under Article 311 TFEU, the Union is required to provide itself with the means necessary to attain its objectives and carry through its policies;

    B.  whereas the Union budget is primarily an investment tool that can achieve economies of scale unattainable at Member State level and support European public goods, in particular through cross-border projects; whereas all spending through the Union budget must provide European added value and deliver discernible net benefits compared to spending at national or sub-national level, leading to real and lasting results;

    C.  whereas spending through the Union budget, if effectively targeted, aligned with the Union’s political priorities and better coordinated with spending at national level, helps to avoid fragmentation in the single market, promote upwards convergence, decrease inequalities and boost the overall impact of public investment; whereas public investment is essential as a catalyst for private investment in sectors where the market alone cannot drive the required investment;

    D.  whereas the NextGenerationEU recovery instrument (NGEU) established in the wake of the COVID-19 pandemic enabled significant additional investment capacity of EUR 750 billion in 2018 prices – beyond the Union budget, which amounts to 1,1 % of the EU-27’s gross national income (GNI) – prompting a swift recovery and return to growth and supporting the green and digital transitions; whereas NGEU will not be in place post-2027;

    E.  whereas in 2022 Member States spent an average of 1,4 % of gross domestic product (GDP) on State aid – significantly more than their contribution to the Union budget – with over half of the State aid unrelated to crises;

    F.  whereas the Union budget, bolstered by NGEU and loans through the SURE scheme, has been instrumental in alleviating the economic and social impact of the COVID-19 crisis and in responding to the effects of Russia’s war of aggression against Ukraine; whereas the Union budget remains ill-equipped, in terms of size, structure and rules, to fully play its role in adjusting to evolving spending needs, addressing shocks and responding to crises and giving practical effect to the principle of solidarity, and to enable the Union to fulfil its objectives as established under the Treaties;

    G.  whereas people rightly expect more from the Union and its budget, including the capacity to respond quickly and effectively to evolving needs and to provide them with the necessary support, especially in times of crisis;

    H.  whereas, since the adoption of the current multiannual financial framework (MFF), the political, economic and social context has changed beyond recognition, compounding underlying structural challenges for the Union and leading to a substantial revision of the MFF in 2024;

    I.  whereas the context in which the Commission will prepare its proposals for the post-2027 MFF is every bit as challenging, with the established global and geopolitical order changing quickly and radically, the return of large-scale warfare in the Union’s immediate neighbourhood, a highly challenging economic and social backdrop and the worsening climate and biodiversity crisis; whereas, as the Commission has made clear, the status quo is not an option and the Union budget will need to change accordingly;

    J.  whereas the US administration has decided to retreat from the country’s post-war global role in guaranteeing peace and security, in leading on global governance in the rules-based, multilateral international order and in providing essential development and humanitarian aid to those most in need around the world; whereas the Union will therefore have to step up to fill part of the void the US appears set to leave, placing additional demands on the budget;

    K.  whereas the Union has committed to take all the steps needed to achieve climate neutrality by 2050 at the latest and to protect nature and reverse biodiversity loss; whereas delivering on the policy framework put in place to achieve this objective will require substantial investment; whereas the Union budget will have to play a key role in providing and incentivising that investment;

    L.  whereas, in order to compensate for the budget’s shortcomings, there have been numerous workaround solutions that make the budget more opaque, leaving the public in the dark about the real volume of Union spending, undermining the longer-term predictability of investment the budget is designed to provide and undercutting not only the principle of budget unity, but also Parliament’s role as a legislator and budgetary and discharge authority and in holding the executive to account;

    M.  whereas the Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities; whereas breaches of those values undermine the cohesion of the Union, erode the rights of Union citizens and weaken mutual trust among Member States;

    1.  Insists that, in a fast changing world where people rightly expect more from the Union and its budget and where the Union is confronted with a growing number of crises, the next MFF must be endowed with increased resources compared to the 2021-2027 period, moving away from the historically restrictive, self-imposed level of 1 % of GNI;

    2.  Underscores that the next MFF must focus on financing European public goods with discernible added value compared to national spending; highlights the need for enhanced synergies and better coordination between Union and national spending; emphasises that spending will have to address major challenges, such as the return of large-scale warfare in the Union’s immediate neighbourhood, a highly challenging economic and social backdrop, a competitiveness gap and the worsening climate and biodiversity crisis;

    3.  Considers that the ‘one national plan per Member State’ approach as envisaged by the Commission, with the Recovery and Resilience Facility model as a blueprint, cannot be the basis for shared management spending post-2027; underlines that the design of shared management spending under the next MFF must fully safeguard Parliament’s roles as legislator and budgetary and discharge authority and be designed and implemented through close collaboration with regional and local authorities and all relevant stakeholders;

    4.  Calls for the next MFF to continue support for economic, social and territorial cohesion in order to help bind the Union together, deepen the single market, promote convergence and reduce inequality, poverty and social exclusion;

    5.  Considers that the idea of an umbrella Competitiveness Fund merging existing programmes as envisaged by the Commission is not fit for purpose; stresses that the fund should instead be a new instrument taking advantage of a toolbox of funding based on lessons learned from InvestEU and the Innovation Fund and complementing existing, highly successful programmes;

    6.  Stresses that, in particular in the light of the US’s retreat from its role as a global guarantor of peace and security, there is a clear need to progress towards a genuine Defence Union, with the next MFF supporting a comprehensive security approach through an increase in investment; stresses that defence spending cannot come at the expense of nor lead to a reduction in long-term investment in the economic, social and territorial cohesion of the Union;

    7.  Calls for genuine simplification for final beneficiaries by avoiding programmes with overlapping objectives, diverging eligibility criteria and different rules governing horizontal provisions; underlines that simplification cannot mean more leeway for the Commission without the necessary checks and balances and must therefore be achieved with full respect for the institutional balance provided for in the Treaties;

    8.  Insists on enhanced in-built crisis response capacity in the next MFF and sufficient margins under each heading; stresses that, alongside predictability for investment, spending programmes should retain a substantial in-built flexibility reserve, with allocation to specific policy objectives to be decided by the budgetary authority; underlines that flexibility for humanitarian aid should be ring-fenced; considers that the post-2027 MFF should include two special instruments – one dedicated to ensuring solidarity in the event of natural disasters and one for general-purpose crisis response;

    9.  Underlines that compliance with Union values and fundamental rights is an essential pre-requisite to access EU funds; insists that the Union budget be protected against misuse, fraud and breaches of the principle of the rule of law and calls for a stronger link between the rule of law and the Union budget post-2027;

    10.  Underlines that the repayment of NGEU borrowing must not endanger the financing of EU policies and priorities; stresses, therefore, that all costs related to borrowing backed by the Union budget or the budgetary headroom be treated distinctly from appropriations for EU programmes within the future MFF architecture;

    11.  Calls on the Council to adopt new own resources as a matter of urgency in order to enable sustainable repayment of NGEU borrowing; stresses that new genuine own resources, beyond the IIA, are essential for the Union’s higher spending needs; considers that all instruments and tools should be explored in order to provide the Union with the necessary resources, and considers, in this respect, that joint borrowing presents a viable option to ensure that the Union has sufficient resources to respond to acute Union-wide crises, such as the ongoing crisis in the area of security and defence;

    12.  Stands ready to work constructively with the Council and Commission to deliver a long-term budget that addresses the Union’s needs; highlights that the post-2027 MFF is being constructed in a far from ‘business as usual’ context and takes seriously its institutional role as enshrined in the Treaties; insists that it will only approve a long-term budget that is fit for purpose for the Union in a changing world and calls for swift adoption of the MFF to enable timely implementation of spending programmes from 1 January 2028;

    A long-term budget with a renewed spending focus

    13.  Considers that, in view of the structural challenges facing the Union, the post-2027 MFF should adjust its spending focus to ensure that the Union can meet its strategic policy aims as detailed below;

    Competitiveness, strategic autonomy, social, economic and territorial cohesion and resilience

    14.  Is convinced that boosting competitiveness, decarbonising the economy and enhancing the Union’s innovation capacity are central priorities for the post-2027 MFF and are vital to ensure long-term, sustainable and inclusive growth and a thriving, more resilient economy and society;

    15.  Considers that the Union must develop a competitiveness framework in line with its own values and political aims and that competitiveness must foster not only economic growth, but also social, economic and territorial cohesion and environmental sustainability as underlined in both the Draghi and Letta reports;

    16.  Underlines that, as spelt out in the Letta and Draghi reports, the European economy and social model are under intense strain, with the productivity, competitiveness and skills gap having knock-on effects on the quality of jobs and on living standards for Europeans already grappling with high housing, energy and food prices; is concerned that a lack of job opportunities and high costs of living increase the risk of a brain drain away from Europe;

    17.  Points out that Draghi puts the annual investment gap with respect to innovation and infrastructure at EUR 750-800 billion per year between 2025 and 2030; underlines that the Union budget must play a vital role but it cannot cover that shortfall alone, and that the bulk of the effort will have to come from the private sector – points to the need to exploit synergies between public and private investment, in particular by simplifying and harmonising the EU investment architecture;

    18.  Stresses that the Union budget must be carefully coordinated with national spending, so as to ensure complementarity, and must be designed such that it can de-risk, mobilise and leverage private investment effectively, enabling start-ups and SMEs to access funds more readily; calls, therefore, for programmes such as InvestEU, which ensures additionality and follows a market-based, demand-driven approach, to be significantly reinforced in the next MFF; considers that financial instruments and budgetary guarantees are an effective use of resources to achieve critical Union policy goals and calls for them to be further simplified;

    19.  Insists that more must be done to maximise the potential of the role of the European Investment Bank (EIB) Group – together with other international and national financial institutions – in lending and de-risking in strategic policy areas, such as climate and, latterly, security and defence projects; calls for an increased risk appetite and ambition from the EIB Group to crowd in investment, based on a strong capital position, and for a reinforced investment partnership to ensure that every euro spent at Union level is used in the most effective manner;

    20.  Emphasises that funding for research and innovation, including support for basic research, should be significantly increased, should be focused on the Union’s strategic priorities, should continue to be determined by the principle of excellence and should remain merit-based; considers that there should be sufficient resources across the MFF and at national level to fund all high-quality projects throughout the innovation cycle and to achieve the 3 % GDP target for research and development spending by 2030;

    21.  Stresses that the next MFF, building on the current Connecting Europe Facility, should include much greater, directly managed funding for energy, transport and digital infrastructure, with priority given to cross-border connections and national links with European added value; considers that such infrastructure is an absolute precondition for a successful deepening of the single market and for increasing the Union’s resilience in a changing geopolitical order;

    22.  Points out that a secure and robust space sector is critical for the Union’s autonomy and sovereignty and therefore needs sustained investment;

    23.  Underlines that a more competitive, productive and socially inclusive economy helps to generate high-quality, well-paid jobs, thus enhancing people’s standard of living; emphasises that, through programmes such as the European Social Fund+ and Erasmus+, the Union budget can play an important role in supporting education and training systems, enhancing social inclusion, boosting workforce adaptability through reskilling and upskilling, and thus preparing people for employment in a modern economy;

    24.  Insists that the Union budget should continue to support important economic and job-creating sectors where the Union is already a world leader, such as tourism and the cultural and creative sectors; underscores the need for dedicated funding for tourism, including to implement the EU Strategy for Sustainable Tourism, in the Union budget post-2027; points to the importance of Creative Europe in contributing to Europe’s diversity and competitiveness and in supporting vibrant societies;

    25.  Stresses that, in order to compete with other major global players, the European economy must also become more competitive and resilient on the supply side by investing more in the Union’s open strategic autonomy through enhanced industrial policy and a focus on strategic sectors, resource-efficiency and critical technologies to reduce dependence on third countries;

    26.  Considers that, in light of the above, the idea of an umbrella Competitiveness Fund merging existing programmes as envisaged by the Commission is not fit for purpose; stresses that the fund should instead be a new instrument taking advantage of a toolbox of funding based on lessons learned from InvestEU and the Innovation Fund; recalls that, under Article 182 TFEU, the Union is required to adopt a framework programme for research;

    27.  Notes that, in the Commission communication on the competitiveness compass, the Commission argues that a new competitiveness coordination tool should be established in order to better align industrial and research policies and investment between EU and national level; notes that the proposed new tool is envisaged as part of a ‘new, lean steering mechanism’ designed ‘to reinforce the link between overall policy coordination and the EU budget’; insists that Parliament must play a full decision-making role in both mechanisms;

    28.  Emphasises that food security is a vital component of strategic autonomy and that the next MFF must continue to support the competitiveness and resilience of the Union’s farming and fisheries sectors, including small-scale and young farmers and fishers, and help the sectors to better protect the climate and biodiversity, as well as the seas and oceans; highlights that a modern and simplified common agricultural policy is crucial for increasing productivity through technical progress, ensuring a fair standard of living for farmers, guaranteeing food security and the production of safe, high-quality and affordable food for Europeans, fostering generational renewal and ensuring the viability of rural areas;

    29.  Points out that the farming sector is particularly vulnerable to inflationary shocks which affect farmers’ purchasing power; calls for an increased and dedicated budget for the CAP in the next MFF, safeguarding it from possible cuts, in order to maintain its integrity and commonality, as well as the coherence and interconnection between its first and second pillar, and therefore opposes the idea of integrating the CAP into a single fund for each Member State; calls for additional dedicated funding sources to be explored where appropriate, including outside of the CAP, in order to cope with natural disasters and provide incentives to farmers and foresters to contribute to climate change mitigation, biodiversity recovery and nature protection, without measures causing a regression in EU agricultural production;

    30.  Stresses that the new global challenges facing EU farmers, including the present geopolitical situation, climate change and rising input prices, require sound financial allocation in the next CAP; emphasises that, in order to address these challenges, taking into account the lessons learned from the COVID-19 crisis, and to avoid reductions to farmers’ support, the CAP urgently needs an increased budget in the next MFF that is indexed to inflation through annual re-evaluation; underlines, in that respect, that direct payments in the current form generate clear EU added value and should continue to strengthen income security, production and protection against price volatility, better targeting persons actively engaged in agricultural production and the provision of public goods, while respecting realistic and balanced EU environmental and social standards; calls for a fair and efficient distribution of CAP support within and among the Member States; calls for the continuation and reinforcement of measures that maintain production in vulnerable areas and guarantee the viability of rural communities and the adequacy of public infrastructure, specifically regarding digitalisation and particularly through the European Agricultural Fund for Rural Development, and the renewed involvement of local and regional authorities in the management of such measures; stresses the need to increase and reform the agricultural reserve in order to respond effectively and rapidly to future crises that the European agricultural sector will have to deal with, and to establish new tools for managing natural, market and sanitary risks, such as an EU reinsurance scheme to better mitigate the effects of future crises and provide greater stability for farmers; emphasises that specific solutions must be found for the farmers in eastern Europe who are most affected by the cascade effects of Russia’s war against Ukraine, such as high input prices, inflation and market disturbances; urges the Commission to continue to set up the necessary financial and legal framework for the food supply chain in order to strengthen the position of farmers and better combat unfair trading practices; calls on the Commission to support EU farmers by promoting agri-food products inside and outside the Union through a dynamic and stronger EU promotion policy; regrets the funding cuts made to the programme on the promotion of agricultural products during the review of the current MFF; emphasises that the next MFF must include dedicated funds for agri-tourism, female entrepreneurship, vocational training and technological innovation in agriculture;

    31.  Recalls that social, economic and territorial cohesion is a cornerstone of European integration and is vital in binding the Union together and deepening the single market; reaffirms, in that respect, the importance of the convergence process; underlines that a modernised cohesion policy must follow a decentralised, place-based, multilevel governance approach and be built around the shared management and partnership principle, fully involving local and regional authorities and relevant stakeholders, ensuring that resources are directed where they are most needed to reduce regional disparities;

    32.  Stresses that cohesion policy funding must tackle the key challenges the Union faces, such as demographic change and depopulation, and target the regions and people most in need; calls, furthermore, for enhanced access to EU funding for cities, regions and urban authorities; recalls that, under Article 349 TFEU, the Union is required to put in place specific measures for the outermost regions and stresses, therefore, the need for continued, targeted support for these regions in the next MFF, including via a reinforced programme of options specifically relating to remoteness and insularity (POSEI);

    33.  Recalls the importance of the social dimension of the European Union and of promoting the implementation of the European Pillar of Social Rights, its Action Plan and headline targets; emphasises that the Union budget should, therefore, play a pivotal role in reducing inequality, poverty and social exclusion, including by supporting children, families and vulnerable groups; recalls that around 20 million children in the Union are at risk of poverty and social exclusion; stresses that addressing child poverty across the Union requires appropriately funded, comprehensive and integrated measures, together with the efficient implementation of the European Child Guarantee at national level; emphasises that Parliament has consistently requested a dedicated budget within the ESF+ to support the Child Guarantee as a central pillar of the EU anti-poverty strategy;

    34.  Highlights, in this regard, the EU-wide housing crisis affecting millions of families and young people; stresses the need for enhanced support for housing through the Union budget, in particular via cohesion policy, and through other funding sources, such as the EIB Group and national promotional banks; acknowledges that, while Union financing cannot solve the housing crisis alone, it can play a crucial role in financing urgent measures and complementing broader Union and national efforts to improve housing affordability and enhance energy efficiency of the housing stock;

    35.  Points out that Russia’s war of aggression against Ukraine has had substantial economic and social consequences, in particular in Member States bordering Russia and Belarus; insists that the next MFF provide support to these regions;

    The green and digital transitions

    36.  Highlights that the green and digital transitions are inextricably linked to competitiveness, the modernisation of the economy and the resilience of society and act as catalysts for a future-oriented and resource-efficient economy; insists therefore, that the post-2027 MFF must continue to support and to further accelerate the twin transitions;

    37.  Recalls that the Union budget is an essential contributor to achieving climate neutrality by 2050, including through support for the 2030 and 2040 targets; underlines that the transition will require a decarbonisation of the economy, in particular through the deployment of clean technologies, improved energy and transport infrastructure and more energy-efficient housing; notes that the Commission estimates additional investment needs to achieve climate neutrality by 2050 at 1,5 % of GDP per year compared to the decade 2011-2020 and that, while the Union budget alone cannot cover the gap, it must remain a vital contributor; calls, therefore, for increased directly managed support for environment and biodiversity protection and climate action building on the current LIFE programme;

    38.  Underlines that industry will be central in the transition to net zero and the establishment of the Energy Union, and that support will be needed in helping some industrial sectors and their workers to adapt; stresses the importance of a just transition that must leave no one behind, requiring, inter alia, investment in regions that are heavily fossil-fuel dependent and increased support for vulnerable households, in particular through the Just Transition Mechanism and the Social Climate Fund;

    39.  Points to the profound technological shift under way, with technologies such as artificial intelligence and quantum both creating opportunities, in terms of the Union’s economic potential and global leadership and improvements to citizens’ lives, and posing reliability, ethical and sovereignty challenges; stresses that the next MFF must support research into, and the development and safe application of digital technologies and help people to hone the knowledge and skills they need to work with and use them;

    Security, defence and preparedness

    40.  Recalls that peace and security are the foundation for the Union’s prosperity, social model and competitiveness, and a vital pillar of the Union’s geopolitical standing; stresses that the next MFF must support a comprehensive security approach by investing significantly more in safeguarding the Union against the myriad threats it faces;

    41.  Underlines that, as the Niinistö report makes clear, multiple threats are combining to heighten instability and increase the Union’s vulnerability, chief among them the fragmenting global order, the security threat posed by Russia and Belarus, growing tensions globally, hostile international actors, the globalisation of criminal networks, hybrid campaigns – which include cyberattacks, foreign information manipulation, disinformation and interference and the instrumentalisation of migration – increasingly frequent and intense extreme weather events as a result of climate change, and health threats;

    42.  Points out that the Union has played a vital role in achieving lasting peace on its territory and must continue to do so by adjusting to the reality of war on its doorstep and the need to vastly boost defence infrastructure, capabilities and readiness, including through the Union budget, going far beyond the current allocation of less than 2 % of the MFF;

    43.  Notes that European defence capabilities suffer from decades of under-investment and that, according to the Commission, the defence spending gap currently stands at EUR 500 billion for the next decade; underlines that the Union budget alone cannot fill the gap, but has an important role to play, in conjunction with national budgets and with a focus on clear EU added value; considers that the Union budget and lending through the EIB Group can help incentivise investment in defence; stresses that defence spending must not come at the expense of social and environmental spending, nor must it lead to a reduction in funding for long-standing Union policies that have proved their worth over time;

    44.  Underlines the merits of the defence programmes and instruments put in place during the current MFF, which have enhanced joint research, production and procurement in the field of defence, providing a valuable foundation on which to build further Union policy and investment;

    45.  Emphasises that, given the geopolitical situation, there is a clear need to act and to progress towards a genuine Defence Union, in coordination with NATO and in full alignment with the neutrality commitments of individual Member States; concurs, in that regard, with the Commission’s analysis that the next MFF must provide a comprehensive and robust framework in support of EU defence;

    46.  Underscores the importance of a competitive and resilient European defence technological and industrial base; considers that enhanced joint EU-level investment in defence in the next MFF backed up by a clear and transparent governance structure can help to avoid duplication, generate economies of scale, and thus significant savings for Member States, reduce fragmentation and ensure the interoperability of equipment and systems; underscores the importance of technology in modern defence systems and therefore of investing in research, cyber-defence and cybersecurity and in dual-use products; points to the need to direct support towards the defence industry within the Union, thus strengthening strategic autonomy, creating quality high-skilled jobs, driving innovation and creating cross-border opportunities for EU businesses, including SMEs;

    47.  Points to the importance of increasing support in the budget for military mobility, which upgrades infrastructure for dual-use military and civilian purposes, enabling the large-scale movement of military equipment and personnel at short notice and thus contributing to the Union’s defence capabilities and collective security; highlights, in that regard, the importance of financing for the trans-European transport networks to enable their adaptation for dual-use purposes;

    48.  Emphasises that the Union needs to ramp up funding for preparedness across the board; is alarmed by the growing impact of natural disasters, which are often the result of climate change and are therefore likely to occur with greater frequency and intensity in the future; points out that, according to the 2024 European Climate Risk Assessment Report, cumulated economic losses from natural disasters could reach about 1,4 % of Union GDP;

    49.  Underlines, therefore, that, in addition to efforts to mitigate climate change through the green transition, significant investment is required to adapt to climate change, in particular to prevent and reduce the impact of natural disasters and severe weather events; considers that support for this purpose, such as through the current Union Civil Protection Mechanism, must be significantly increased in the next MFF and made available quickly to local and regional authorities, which are often on the frontline;

    50.  Emphasises that reconstruction and recovery measures after natural disasters must be based on the ‘build back better’ approach and prioritise nature-based solutions; stresses the importance of sustainable water management and security and hydric resilience as part of the Union’s overall preparedness strategy;

    51.  Recalls that the COVID-19 pandemic wreaked economic and social havoc globally and that a key lesson from the experience is that there is a need to prioritise investment in prevention of, preparedness for and response to health threats, in medical research and disease prevention, in access to critical medicines, in healthcare infrastructure, in physical and mental health and in the resilience and accessibility of public health systems in the Union; recalls that strategic autonomy in health is key to ensuring the Union’s preparedness in this area;

    52.  Considers that the next MFF must build on the work done in the current programming period by ensuring that the necessary investment is in place to build a genuine European Health Union that delivers for all citizens;

    53.  Underlines that, with technological developments, it has become easier for malicious and opportunistic foreign actors to spread disinformation, encourage online hate speech, interfere in elections and mount cyberattacks against the Union’s interests; insists that the next MFF must invest in enhanced cybersecurity capabilities and equip the Union to counter hybrid warfare in its various guises;

    54.  Stresses that a free, independent and pluralistic media is a fundamental component of Europe’s resilience, safeguarding not only the free flow of information but also a democratic mindset, critical thinking and informed decision-making; points to the importance of investment in independent and investigative journalism, fact-checking initiatives, digital and media literacy and critical thinking to safeguard against disinformation, foreign information manipulation and electoral interference as part of the European Democracy Shield initiative and therefore to guarantee democratic resilience; underscores the need for continued Union budget support for initiatives in these areas;

    55.  Underscores the importance of continued funding, in the next MFF, for effective protection of the EU’s external borders; underlines the need to counter transnational criminal networks and better protect victims of trafficking networks, and to strengthen resilience and response capabilities to address hybrid attacks and the instrumentalisation of migration, by third countries or hostile non-state actors; highlights, in particular, the need for support to frontline Member States for the purposes of securing the external borders of the EU;

    56.  Underlines that the EU’s resilience and preparedness are inextricably linked to those of its regional and global partners; emphasises that strengthening partners’ capacity to prevent, withstand and effectively respond to extreme weather events, health crises, hybrid campaigns, cyberattacks or armed conflict also lowers the risk of spill-over effects for Europe;

    External action and enlargement

    57.  Insists that, in a context of heightened global instability, the Union must continue to engage constructively with third countries and support peace, and conflict prevention, stability, prosperity, security, human rights, the rule of law, equality, democracy and sustainable development globally, in line with its global responsibility values and international commitments;

    58.  Regrets the fact that external action in the current MFF has been underfunded, leading to significant recourse to special instruments and substantial reinforcements in the mid-term revision; notes, in particular, that humanitarian aid funding has been woefully inadequate, prompting routine use of the Emergency Aid Reserve;

    59.  Underlines that the US’s retreat from its post-war global role in guaranteeing peace, security and democracy, in leading on global governance in the rules-based, multilateral international order and in providing essential development and humanitarian aid to those most in need around the world will leave an enormous gap and that the Union has a responsibility and overwhelming strategic interest in helping to fill that gap; calls on the Commission to address the consequences of the US’s retreat at the latest in its proposal for the post-2027 MFF;

    60.  Stresses that the next MFF must continue to tackle the most pressing global challenges, from fighting climate change, to providing relief in the event of natural disasters, preventing and addressing violent conflict and guaranteeing global security, ensuring global food security, improving healthcare and education systems, reducing poverty and inequality, promoting democracy, human rights, the rule of law and social justice and boosting competitiveness and the security of global supply chains, in full compliance with the principle of policy coherence for development; emphasises, in particular, the need for support for the Union’s Southern and Eastern Neighbourhoods;

    61.  Underlines that, in particular in light of the drastic cuts to the USAID budget, the budget must uphold the Union’s role as the world’s leading provider of development aid and climate finance in line with the Union’s global obligations and commitments; recalls, in that regard, that the Union and its Member States have collectively committed to allocating 0,7 % of their GNI to official development assistance and that poverty alleviation must remain its primary objective; insists that the budget must continue to support the Union in its efforts to defend the rules-based international order, democracy, multilateralism, human rights and fundamental values;

    62.  Insists that, given the unprecedented scale of humanitarian crises, mounting global challenges and uncertainty of US assistance under the current administration, humanitarian aid funding must be significantly enhanced and that its use must remain solely needs-based and respect the principles of neutrality, independence and impartiality; emphasises that the needs-based nature of humanitarian aid requires ring-fenced funding delivered through a stand-alone spending programme, distinct from other external action financing; underscores, furthermore, that effective humanitarian aid provision is contingent on predictability through a sufficient annual baseline allocation;

    63.  Emphasises that humanitarian aid, by its very nature, requires substantial flexibility and response capacity; considers, therefore, that, in addition to an adequate baseline figure, humanitarian aid will require significant ring-fenced flexibility in its design to enable an effective response to the growing crises;

    64.  Emphasises that, in a context in which global actors are increasingly using trade interdependence as a means of economic coercion, the Union must bolster its capacity to protect and advance its own strategic interests, develop more robust tools to counter coercion and ensure genuine reciprocity in its partnerships; stresses that such an approach requires the strategic allocation of external financing so as to support, for example, economic, security and energy partnerships that align with the Union’s values and strategic interests;

    65.  Considers that enlargement represents an opportunity to strengthen the Union as a geopolitical power and that the next MFF is pivotal for preparing the Union for enlargement and the candidate countries for accession; recalls that the stability, security and democratic resilience of the candidate countries are inextricably connected to those of the EU and require sustained strategic investment, linked to reforms, to support their convergence with Union standards; underlines the important role that citizens and civil society organisations play in the process of enlargement;

    66.  Points to the need for strategically targeted support for pre-accession and for growth and investment; is of the view that post-2027 pre-accession assistance should be provided in the form of both grants and loans; believes, in that context, that the future framework should allow for innovative financing mechanisms, as well as lending to candidate countries backed by the budgetary headroom (the difference between the own resources and the MFF ceilings);

    67.  Stresses that financial support must be conditional on the implementation of reforms aligned with the Union acquis and policies and adherence to Union values; emphasises, in this regard, the need for a strong governance model that ensures parliamentary accountability, oversight and control and a strong, effective anti-fraud architecture;

    68.  Reiterates its full support for Ukrainians in their fight for freedom and democracy and deplores the terrible suffering and impact resulting from Russia’s unprovoked and unjustifiable war of aggression; welcomes the decision to grant Ukraine and the neighbouring Republic of Moldova candidate country status and insists on the need to deploy the necessary funds to support their accession processes;

    69.  Underlines that pre-accession support to Ukraine has to be distinct from and additional to financial assistance for macroeconomic stability, reconstruction and post-war recovery, where needs are far more substantial and require a concerted international effort, of which support through the Union budget should be an important part;

    70.  Is convinced that the existing mandatory revision clause in the event of enlargement should be maintained in the next framework and that national envelopes should not be affected; underlines that the next MFF will also have to put in place appropriate transitional and phasing-in measures for key spending areas, such as cohesion and agriculture, based on a careful assessment of the impacts on different sectors;

    Fundamental rights, Union values and the rule of law

    71.  Emphasises the importance of the Union budget and programmes like Erasmus+ and Citizens, Equality, Rights and Values in promoting and protecting democracy and the Union’s values, fostering the Union’s common cultural heritage and European integration, enhancing citizen engagement, civic education and youth participation, safeguarding and promoting fundamental rights enshrined in the Charter of Fundamental Rights and the rule of law; calls, in this regard, for increased funding for Erasmus+ in the next MFF; points to the importance of the independence of the justice system, the sound functioning of national institutions, de-oligarchisation, robust support for and, in line with article 11(2) TEU, an active dialogue with civil society, which is vital for fostering an active civic space, ensuring accountability and transparency and informing policymakers about best practices from the ground;

    72.  Highlights, in that connection, that the recast of the Financial Regulation requires the Commission and the Member States, in the implementation of the budget, to ensure compliance with the Charter of Fundamental Rights and to respect the values on which the Union is founded, which are enshrined in Article 2 TEU; expects the Commission to ensure that the proposals for the next MFF, including for the spending programmes, are aligned with the Financial Regulation recast;

    73.  Stresses that instability in neighbouring regions and beyond, poverty, underlying trends in economic development, demographic changes and climate change, continue to generate migration flows towards the Union, placing significant pressure on asylum and migration systems; underlines that the post-2027 MFF must support the full and swift implementation of the Union’s Asylum and Migration Pact and effective return and readmission policies, in line with fundamental rights and EU values, including the principle of solidarity and fair sharing of responsibility; underlines, moreover, that, in line with the Pact, the EU must pursue enhanced cooperation and mutually beneficial partnerships with third countries on migration, with adequate parliamentary scrutiny, and that such cooperation must abide by EU and international law;

    74.  Underlines that compliance with Union values and fundamental rights is an essential pre-requisite to access EU funds; highlights the importance of strong links between respect for the rule of law and access to EU funds under the current MFF; believes that the protection of the Union’s financial interests depends on respect for the rule of law at national level; welcomes, in particular, the positive impact of the Rule of Law Conditionality Regulation in protecting the Union’s financial interests in cases of systemic and persistent breaches of the rule of law; calls on the Commission and the Council to apply the regulation strictly, consistently and without undue delay wherever necessary; emphasises that decisions to suspend or reduce Union funding over breaches of the rule of law must be based on objective criteria and not be guided by other considerations, nor be the outcome of negotiations;

    75.  Points to the need for a stronger link between the rule of law and the Union budget post-2027 and welcomes the Commission’s commitment to bolster links between the recommendations in the annual rule of law report and access to funds through the budget; calls on the Commission to outline, in the annual rule of law report from 2025 onwards, the extent to which identified weaknesses in rule of law regimes potentially pose a risk to the Union budget; welcomes, furthermore, the link between respect for Union values and the implementation of the budget and calls on the Commission to actively monitor Member States’ compliance with this principle in a unified manner and to take swift action in the event of non-compliance;

    76.  Calls for the consolidation of a robust rule of law toolbox, building on the current conditionality provisions under the Recovery and Resilience Facility (RRF), the horizontal enabling conditions in the Common Provisions Regulation and the relevant provisions of the Financial Regulation and insists that the toolbox should cover the entire Union budget; underlines the need for far greater transparency and consistency with regard to the application of tools to protect the rule of law and for Parliament’s role to be strengthened in the application and scrutiny of such measures; insists, furthermore, on the need for consistency across instruments when assessing breaches of the rule of law in Member States;

    77.  Recalls that the Rule of Law Conditionality Regulation provides that final recipients should not be deprived of the benefits of EU funds in the event of sanctions being applied to their government; believes that, to date, this provision has not been effective and stresses the importance of applying a smart conditionality approach so that beneficiaries are not penalised because of their government’s actions; calls on the Commission, in line with its stated intention in the political guidelines, to propose specific measures to ensure that local and regional authorities, civil society and other beneficiaries can continue to benefit from Union funding in cases of breaches of the rule of law by national governments without weakening the application of the regulation and maintaining the Member State’s obligation to pay under Union law;

    A long-term budget that mainstreams the Union’s policy objectives

    78.  Stresses that a long-term budget that is fully aligned with the Union’s strategic aims requires that key objectives be mainstreamed across the budget through a set of horizontal principles, building on the lessons from the current MFF and RRF;

    79.  Recalls that the implementation of horizontal principles should not lead to an excessive administrative burden on beneficiaries and be in line with the principle of proportionality; calls for innovative solutions and the use of automated reporting tools, including artificial intelligence, to achieve more efficient data collection;

    80.  Underlines, therefore, that the next MFF must ensure that, across the board, spending programmes pursue climate and biodiversity objectives, promote and protect rights and equal opportunities for all, including gender equality, support competitiveness and bolster the Union’s preparedness against threats;

    81.  Points out that effective mainstreaming is best achieved through a toolbox of measures, primarily through policy, project and regulatory design, thorough impact assessments and solid tracking of spending and, in specific cases, spending targets based on relevant and available data; welcomes the significant improvements in performance reporting in the current MFF, which allow for much better scrutiny of the impact of EU spending and calls for this to be further developed in the next programing period;

    82.  Welcomes the development of a methodology to track gender-based spending and considers that the lessons learnt, in particular as regards the collection of gender-disaggregated data, the monitoring of implementation and impact and administrative burden, should be applied in the next MFF in order to improve the methodology; calls on the Commission to explore the feasibility of gender budgeting in the next MFF; stresses, in the same vein, the need for a significant improvement in climate and biodiversity mainstreaming methodologies to move towards the measurement of impact;

    83.  Regrets that the Commission has not systematically conducted thorough impact assessments, including gender impact assessments, for all legislation involving spending through the budget and insists that this change;

    84.  Is pleased that the climate mainstreaming target of 30 % is projected to be exceeded in the current MFF; regrets, however, that the Union is not on track to meet the 10 % target for 2026 for biodiversity-related expenditure; insists that the targets in the IIA have nevertheless been a major factor in driving climate and biodiversity spending; calls on the Commission to adapt the spending targets contributing positively to climate and biodiversity in line with the Union policy ambitions in this regard, taking into account the investment needs for these policy ambitions;

    85.  Stresses, furthermore, that the Union budget should be implemented in line with Article 33(2) of the Financial Regulation, therefore without doing significant harm(12) to the specified objectives, respecting applicable working and employment conditions and taking into account the principle of gender equality;

    86.  Welcomes the Commission’s commitment to phase out all fossil fuel subsidies and environmentally harmful subsidies in the next MFF; expects the Commission to come forward with its planned roadmap in this regard as part of its proposal for the next MFF;

    A long-term budget with an effective administration at the service of Europeans

    87.  Underlines the need for Union policies to be underpinned by a well-functioning administration; insists that, post-2027, sufficient financial and staff resources be allocated from the outset so that Union institutions, bodies, decentralised agencies and the European Public Prosecutor’s Office can ensure effective and efficient policy design, high-quality delivery and enforcement, provide technical assistance, continue to attract the best people from all Member States, thus ensuring geographical balance, and have leeway to adjust to changing circumstances;

    88.  Regrets that the Union’s ability to implement policy effectively and protect its financial interests within the current MFF has been undermined by stretched administrative resources and a dogmatic application of a policy of stable staffing, despite increasing demands and responsibilities; points, for example, to the failure to provide sufficient staff to properly implement and enforce the Digital Services(13) and Digital Markets Acts(14), thus undercutting the legislation’s effectiveness and to the repeated redeployments from programmes to decentralised agencies to cover staffing needs; insists that staffing levels be determined by an objective needs assessment when legislation is proposed and definitively adopted, and factored into planning for administrative expenditure from the outset;

    89.  Emphasises that the Commission has sought, to some degree, to circumvent its own stable staffing policy by increasing staff attached to programmes and facilities and thus not covered by the administrative spending ceiling; underscores, however, that such an approach merely masks the problem and may ultimately undermine the operational capacity of programmes; insists, therefore, that additional responsibilities require administrative expenditure and must not erode programme envelopes;

    90.  Stresses that up-front investment in secure and interoperable IT infrastructure and data mining capabilities can also generate longer-term cost savings and hugely enhance policy delivery and tracking of spending;

    91.  Acknowledges that, in the absence of any correction mechanism in the current MFF, high inflation has significantly driven up statutory costs, requiring extensive use of special instruments to cover the shortfall; regrets that the Council elected not to take up the Commission’s proposal to raise the ceiling for administrative expenditure in the MFF revision, thus further eroding special instruments;

    A long-term budget that is simpler and more transparent

    92.  Stresses that the next MFF must be designed so as to simplify the lives of all beneficiaries by cutting unnecessary red tape; underlines that simplification will require harmonising rules and reporting requirements wherever possible, including, as relevant, ensuring consistency between the applicable rules at European, national and regional levels; underlines, in that respect, the need for a genuine, user-friendly single entry point for EU funding and a simplified application procedure designed in consultation with relevant stakeholders; points out, furthermore, that the next MFF must be implemented as close to people as possible;

    93.  Calls for genuine simplification where there are overlapping objectives, diverging eligibility criteria and different rules governing horizontal provisions that should be uniform across programmes; considers that an assessment of which spending programmes should be included in the next MFF must be based on the above aspects, on the need to focus spending on clearly identified policy objectives with clear European added value and on the policy intervention logic of each programme; stresses that reducing the number of programmes is not an end in itself;

    94.  Underlines that simplification cannot mean more leeway for the Commission without the necessary checks and balances and must therefore be achieved with full respect for the institutional balance provided for in the Treaties;

    95.  Insists that simplification cannot come at the expense of the quality of programme design and implementation and that, therefore, a simpler budget must also be a more transparent budget, enabling better accountability, scrutiny, control of spending and reducing the risks of double funding, misuse and fraud; underlines that any reduction in programmes must be offset by a far more detailed breakdown of the budget by budget line, in contrast to some programme mergers in the current MFF, such as the Neighbourhood, Development and International Cooperation Instrument – Global Europe (NDICI – Global Europe), which is an example not to follow; calls, therefore, for a sufficiently detailed breakdown by budget line to enable the budgetary authority to exercise proper accountability and ensure that decision-making in the annual budgetary procedure and in the course of budget implementation is meaningful;

    96.  Recalls that transparency is essential to retain citizens’ trust, and that fraud and misuse of funds are extremely detrimental to that trust; underlines, therefore, the need for Parliament to be able to control spending and assess whether discharge can be granted; insists that proper accountability requires robust auditing for all budgetary expenditure based on the application of a single audit trail; calls on the Commission to put in place harmonised and effective anti-fraud mechanisms across funding instruments for the post-2027 MFF that ensure the protection of the Union’s budget;

    97.  Reiterates its long-standing position that all EU-level spending should be brought within the purview of the budgetary authority, thereby ensuring transparency, democratic control and protection of the Union’s financial interests; calls, therefore, for the full budgetisation of (partially) off-budget instruments such as the Social Climate Fund, the Innovation Fund and the Modernisation Fund, or their successors;

    A long-term budget that is more flexible and more responsive to crises and shocks

    98.  Points out that, traditionally, the MFF has not been conceived with a crisis response or flexibility logic, but rather has been designed primarily to ensure medium-term investment predictability; underlines that, in a rapidly changing political, security, economic and social context, such an approach is no longer tenable; insists on sufficient in-built crisis response capacity in the next MFF;

    99.  Underscores that the current MFF has been beset by a lack of flexibility and an inability to adjust to evolving spending priorities; considers that the next MFF needs to strike a better balance between investment predictability and flexibility to adjust spending focus; highlights that spending in certain areas requires greater stability than in others where flexibility is more valuable; stresses that recurrent redeployments are not a viable way to finance the Union’s priorities as they damage investments and jeopardise the delivery of agreed policy objectives;

    100.  Believes that, while allocating a significant portion of funding to objectives up-front, spending programmes should retain a substantial in-built flexibility reserve, with allocation to specific policy objectives to be decided by the budgetary authority; notes that the NDICI – Global Europe’s emerging challenges and priorities cushion provides a model for such a flexibility reserve, but that the decision-making process for its mobilisation must not be replicated in the future MFF; points to the need for stronger, more effective scrutiny powers of the co-legislators over the setting of policy priorities and objectives and a detailed budgetary breakdown to ensure that the budgetary authority is equipped to make meaningful and informed decisions;

    101.  Underlines that the MFF must have sufficient margins under each heading to ensure that new instruments or spending objectives agreed over the programming period can be accommodated without eroding funding for other policy and long-term strategic objectives or eating into crisis response capacity;

    102.  Underlines that the possibility for budgetary transfers under the Financial Regulation already provides for flexibility to adjust to evolving spending needs in the course of budget implementation; stresses that, under the current rules, the Commission has significant freedom to transfer considerable amounts between policy areas without budgetary authority approval, which limits scrutiny and control; calls, therefore, for the rules to be changed so as to introduce a maximum amount, in addition to a maximum percentage per budget line, for transfers without approval; considers that for transfers from Union institutions other than the Commission that are subject to a possible duly justified objection by Parliament or the Council, a threshold below which they would be exempt from that procedure could be a useful measure of simplification;

    103.  Recalls that the current MFF has been placed under further strain due to high levels of inflation in a context where an annual 2 % deflator is applied to 2018 prices, reducing the budget’s real-terms value and squeezing its operational and administrative capacity; considers, therefore, that the future budget should be endowed with sufficient response capacity to enable the budget to adapt to inflationary shocks;

    104.  Calls for a root-and-branch reform of the existing special instruments to bolster crisis response capacity and ensure an effective and swift reaction through more rapid mobilisation; underlines that the current instruments are both inadequate in size and constrained by excessive rigidity, with several effectively ring-fenced according to crisis type; points out that enhanced crisis response capacity will ensure that cohesion policy funds are not called upon for that purpose and can therefore be used for their intended investment objectives;

    105.  Considers that the post-2027 MFF should include only two special instruments – one dedicated to ensuring solidarity in the event of natural disasters (the successor to the existing European Solidarity Reserve) and one for general-purpose crisis response and for responding to any unforeseen needs and emerging priorities, including where amounts in the special instrument for natural disasters are insufficient (the successor to the Flexibility Instrument); insists that both special instruments should be adequately funded from the outset and able to carry over unspent amounts indefinitely over the MFF period; believes that all other special instruments can either be wound up or subsumed into the two special instruments or into existing programmes;

    106.  Calls for the future Flexibility Instrument to be heavily front-loaded and subsequently to be fed through a number of additional sources of financing: unspent margins from previous years (as with the current Single Margin Instrument), the annual surplus from the previous year, a fines-based mechanism modelled on the existing Article 5 of the MFF Regulation, reflows from financial instruments and decommitted appropriations; underlines that the next MFF should be designed such that the future special instruments are not required to cover debt repayment;

    107.  Underlines that re-use of the surplus, of reflows from financial instruments and surplus provisioning and of decommitments would require amendments to the Financial Regulation;

    108.  Points out that, with sufficient up-front resources and such arrangements for re-using unused funds, the budget would have far greater response capacity without impinging on the predictability of national GNI-based contributions; insists that an MFF endowed with greater flexibility and response capacity is less likely to require a substantial mid-term revision;

    A long-term budget that is more results-focused

    109.  Emphasises that, in order to maximise impact, it is imperative that spending under the next MFF be much more rigorously aligned with the Union’s strategic policy aims and better coordinated with spending at national level; underlines that, in turn, consultation with regional and local authorities is vital to facilitate access to funding and ensure that Union support meets the real needs of final recipients and delivers tangible benefits for people; underscores the importance of technical assistance to implementing authorities to help ensure timely implementation, additionality of investments and therefore maximum impact;

    110.  Underlines that, in order to support effective coordination between Union and national spending, the Commission envisages a ‘new, lean steering mechanism’ designed ‘to reinforce the link between overall policy coordination and the EU budget’; insists that Parliament play a full decision-making role in any coordination or steering mechanism;

    111.  Considers that the RRF, with its focus on performance and links between reforms and investments and budgetary support, has helped to drive national investments and reforms that would not otherwise have taken place;

    112.  Underlines that the RRF can help to inform the delivery of Union spending under shared management; recalls, however, that the RRF was agreed in the very specific context of the COVID-19 pandemic and cannot, therefore, be replicated wholesale for future investment programmes;

    113.  Points out that spending under shared management in the next MFF must involve regional and local authorities and all relevant stakeholders from design to delivery through a place-based and multilevel governance approach and in line with an improved partnership principle, ensure the cross-border European dimension of investment projects, and focus on results and impact rather than outputs by setting measurable performance indicators, ensuring availability of relevant data and feeding into programme design and adjustment;

    114.  Underlines that the design of shared management spending under the next MFF must safeguard Parliament’s role as legislator, budgetary and discharge authority and in holding the executive to account, putting in place strict accountability mechanisms and guaranteeing full transparency in relation to final recipients or groups of recipients of Union spending funds through an interoperable system enabling effective tracking of cash flows and project progress;

    115.  Considers that the ‘one national plan per Member State’ approach envisaged by the Commission is not in line with the principles set out above and cannot be the basis for shared management spending post-2027; recalls that, in this regard, the Union is required, under Article 175 TFEU, to provide support through instruments for agricultural, regional and social spending;

    A long-term budget that manages liabilities sustainably

    116.  Recalls Parliament’s very firm opposition to subjecting the repayment of NGEU borrowing costs to a cap within an MFF heading given that these costs are subject to market conditions, influenced by external factors and thus inherently volatile, and that the repayment of borrowing costs is a non-discretionary legal obligation; stresses that introducing new own resources is also necessary to prevent future generations from bearing the burden of past debts;

    117.  Deplores the fact that, under the existing architecture and despite the joint declaration by the three institutions as part of the 2020 MFF agreement whereby expenditure to cover NGEU financing costs ‘shall aim at not reducing programmes and funds’, financing for key Union programmes and resources available for special instruments, even after the MFF revision, have de facto been competing with the repayment of NGEU borrowing costs in a context of steep inflation and rising interest rates; recalls that pressure on the budget driven by NGEU borrowing costs was a key factor in cuts to flagship programmes in the MFF revision;

    118.  Underlines that, to date, the Union budget has been required only to repay interest related to NGEU and that, from 2028 onwards, the budget will also have to repay the capital; underscores that, according to the Commission, the total costs for NGEU capital and interest repayments are projected to be around EUR 25-30 billion a year from 2028, equivalent to 15-20 % of payment appropriations in the 2025 budget;

    119.  Acknowledges that, while NGEU borrowing costs will be more stable in the next MFF period as bonds will already have been issued, the precise repayment profile will have an impact on the level of interest and thus on the degree of volatility; insists, therefore, that all costs related to borrowing backed by the Union budget or the budgetary headroom be treated distinctly from appropriations for EU programmes within the MFF architecture;

    120.  Points, in that regard, to the increasing demand for the Union budget to serve as a guarantee for the Union’s vital support through macro-financial assistance and the associated risks; underlines that, in the event of default or the withdrawal of national guarantees, the Union budget ultimately underwrites all macro-financial assistance loans and therefore bears significant and inherently unpredictable contingent liabilities, notably in relation to Ukraine;

    121.  Calls, therefore, on the Commission to design a sound and durable architecture that enables sustainable management of all non-discretionary costs and liabilities, fully preserving Union programmes and the budget’s flexibility and response capacity;

    A long-term budget that is properly resourced and sustainably financed

    122.  Underlines that, as described above, the budgetary needs post-2027 will be significantly higher than the amounts allocated to the 2021-2027 MFF and, in addition, will need to cover borrowing costs and debt repayment; insists, therefore, that the next MFF be endowed with significantly increased resources compared to the 2021-2027 period, moving away from the historically restrictive, self-imposed level of 1 % of GNI, which has prevented the Union from delivering on its ambitions and deprived it of the ability to respond to crises and adapt to emerging needs;

    123.  Considers that all instruments and tools should be explored in order to provide the Union with those resources, in line with its priorities and identified needs; considers, in this respect, that joint borrowing through the issuance of EU bonds presents a viable option to ensure that the Union has sufficient resources to respond to acute Union-wide crises such as the ongoing crisis in the area of security and defence;

    124.  Reiterates the need for sustainable and resilient revenue for the Union budget; points to the legally binding roadmap towards the introduction of new own resources in the IIA, in which Parliament, the Council and the Commission undertook to introduce sufficient new own resources to at least cover the repayment of NGEU debt; underlines that, overall, the basket of new own resources should be fair, linked to broader Union policy aims and agreed on time and with sufficient volume to meet the heightened budgetary needs;

    125.  Recalls its support for the amended Commission proposal on the system of own resources; is deeply concerned by the complete absence of progress on the system of own resources in the Council; calls on the Council to adopt this proposal as a matter of urgency; and urges the Commission to spare no effort in supporting the adoption process;

    126.  Calls furthermore, on the Commission to continue efforts to identify additional innovative and genuine new own resources and other revenue sources beyond those specified in the IIA; stresses that new own resources are essential not only to enable repayment of NGEU borrowing, but to ensure that the Union is equipped to cover its the higher spending needs;

    127.  Calls on the Commission to design a modernised budget with a renewed spending focus, driven by the need for fairness, greater simplification, a reduced administrative burden and more transparency, including on the revenue side; underlines that existing rebates and corrections automatically expire at the end of the current MFF;

    128.  Welcomes the decision, in the recast of the Financial Regulation, to treat as negative revenue any interest or other charge due to a third party relating to amounts of fines, other penalties or sanctions that are cancelled or reduced by the Court of Justice; recalls that this solution comes to an end on 31 December 2027; invites the Commission to propose a definitive solution for the next MFF that achieves the same objective of avoiding any impact on the expenditure side of the budget;

    A long-term budget grounded in close interinstitutional cooperation

    129.  Underlines that Parliament intends to fully exercise its prerogatives as legislator, budgetary authority and discharge authority under the Treaties;

    130.  Recalls that the requirement for close interinstitutional cooperation between the Commission, the Council and Parliament from the early design stages to the final adoption of the MFF is enshrined in the Treaties and further detailed in the IIA;

    131.  Emphasises Parliament’s commitment to play its role fully throughout the process; believes that the design of the MFF should be bottom-up and based on the extensive involvement of stakeholders; underlines, furthermore, the need for a strategic dialogue among the three institutions in the run-up to the MFF proposals;

    132.  Calls on the Commission to put forward practical arrangements for cooperation and genuine negotiations from the outset; points, in particular, to the importance of convening meetings of the three Presidents, as per Article 324 TFEU, wherever they can aid progress, and insists that the Commission follow up when Parliament requests such meetings; reminds the Commission of its obligation to provide information to Parliament on an equal footing with the Council as the two arms of the budgetary authority and as co-legislators on MFF-related basic acts;

    133.  Recalls that the IIA specifically provides for Parliament, the Council and the Commission to ‘seek to determine specific arrangements for cooperation and dialogue’; stresses that the cooperation provisions set out in the IIA, including regular meetings between Parliament and the Council, are a bare minimum and that much more is needed to give effect to the principle in Article 312(5) TFEU of taking ‘any measure necessary to facilitate the adoption of a new MFF’; calls, therefore, on the successive Council presidencies to respect not only the letter, but also the spirit of the Treaties;

    134.  Recalls that the late adoption of the MFF regulation and related legislation for the 2014-2020 and 2021-2027 periods led to significant delays, which hindered the proper implementation of EU programmes; insists, therefore, that every effort be made to ensure timely adoption of the upcoming MFF package;

    135.  Expects the Commission, as part of the package of MFF proposals, to put forward a new IIA in line with the realities of the new budget, including with respect to the management of contingent liabilities; stresses that the changes to the Financial Regulation necessary for alignment with the new MFF should enter into force at the same time as the MFF Regulation;

    o
    o   o

    136.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 433I, 22.12.2020, p. 11, ELI: http://data.europa.eu/eli/reg/2020/2093/oj.
    (2) OJ L 424, 15.12.2020, p. 1, ELI: http://data.europa.eu/eli/dec/2020/2053/oj.
    (3) OJ L 433I, 22.12.2020, p. 28, ELI: http://data.europa.eu/eli/agree_interinstit/2020/1222/oj.
    (4) OJ L 2024/2509, 26.9.2024, p. 1, ELI: http://data.europa.eu/eli/reg/2024/2509/oj.
    (5) OJ L 433I, 22.12.2020, p. 1, ELI: http://data.europa.eu/eli/reg/2020/2092/oj.
    (6) OJ C, C/2024/6751, 26.11.2024, ELI: http://data.europa.eu/eli/C/2024/6751/oj.
    (7) OJ C, C/2023/1067, 15.12.2023, ELI: http://data.europa.eu/eli/C/2023/1067/oj.
    (8) OJ C 177, 17.5.2023, p. 115.
    (9) OJ C 445, 29.10.2021, p. 240.
    (10) OJ C 428, 13.12.2017, p. 10.
    (11) OJ C, C/2025/279, 24.1.2025, ELI: http://data.europa.eu/eli/C/2025/279/oj.
    (12) Article 9 of Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (OJ L 198, 22.6.2020, p. 13, ELI: http://data.europa.eu/eli/reg/2020/852/oj).
    (13) Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (OJ L 277, 27.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2065/oj).
    (14) Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ L 265, 12.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/1925/oj).

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – Competition policy – annual report 2024 – P10_TA(2025)0104 – Thursday, 8 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Treaty on the Functioning of the European Union (TFEU), in particular to Articles 101 to 109 thereof,

    –  having regard to the publication of 18 July 2024 by Ursula von der Leyen entitled ‘Europe’s choice – political guidelines for the next European Commission 2024–2029’,

    –  having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’,

    –  having regard to the report of 18 April 2024 by Enrico Letta entitled ‘Much more than a market’,

    –  having regard to the European Court of Auditors Special Report21/2024 of 23 October 2024 entitled ‘State aid in times of crisis – Swift reaction but shortcomings in the Commission’s monitoring and inconsistencies in the framework to support the EU’s industrial policy objectives’,

    –  having regard to Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (the EC Merger Regulation)(1),

    –   having regard to Article 11 TFEU, which mandates the integration of environmental protection requirements into the definition and implementation of all EU policies and activities, with a view to promoting sustainable development,

    –  having regard to Article 3 of Decision (EU) 2022/591 of the European Parliament and of the Council of 6 April 2022 on a General Union Environment Action Programme to 2030(2), which provides that environmentally harmful subsidies, in particular fossil fuel subsidies, should be phased out without delay,

    –  having regard to the judgments of the Court of Justice of the European Union of 3 September 2024 in Case C‑611/22 P, Illumina v Commission(3), of 10 September 2024 in Case C‑465/20 P, European Commission v Ireland and Others(4), and of 10 September 2024 in Case C‑48/22 P (Google and Alphabet v Commission)(5),

    –  having regard to the Commission’s report of June 2024 entitled ‘Protecting competition in a changing world – Evidence on the evolution of competition in the EU during the past 25 years’,

    –  having regard to the study entitled ‘The role of commodity traders in shaping agricultural markets’, published by its Policy Department for Structural and Cohesion Policies in November 2024,

    –  having regard to the report of 20 December 2023 by the European Securities and Markets Authority entitled ‘CRA Market Share Report: 2023 edition’,

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Economic and Monetary Affairs (A10-0071/2025),

    A.  whereas the current challenging economic, climate and geopolitical contexts, marked by uncertainty and unpredictability, require a renewed approach to European competitiveness and concrete strategies to boost economic growth;

    B.  whereas the proper enforcement of the EU competition policy framework leads to lower prices, higher quality, greater choice for consumers, faster innovation and a fairer and more resilient economy, and protects entry conditions for operators in the internal market, tackling abuses of dominant position, monopolies and practices distortive to the internal market;

    C.  whereas the Draghi report underlines that the EU has a broad and diversified industrial innovation base, with a strong comparative advantage in green technologies, but that sustained efforts are needed in order to retain that advantage; whereas the integration of climate and environmental considerations into competition policy is essential, in that regard; whereas the Letta report maintains that the lack of EU integration in the financial, energy and electronic communications sectors is a primary reason for Europe’s declining competitiveness;

    D.  whereas the EU’s competition policy could contribute to bolstering the resilience of the internal market, as well as achieving the goals of the European Green Deal, the 2030 Digital Compass and the Competitiveness Compass, for which international exchange and cooperation are essential;

    E.  whereas the Commission and the national competition authorities need to act in an impartial and objective way in order to preserve the credibility of the EU’s competition policy; whereas the political independence of national competition authorities is of utmost importance to ensure the impartiality and credibility of competition policy;

    General considerations

    1.  Considers that EU competition law seeks to shield against excessive levels of concentration and accumulation of market power, and reaffirms the role of competition policy in encouraging efficiency, innovation and growth, creating a level playing field and protecting consumers, by assuring that markets remain competitive, efficient, dynamic and innovative, delivering high-quality products and services at fair prices and with a wider range of choice;

    2.  Reiterates that competition policy should contribute to all of the EU’s policies, notably in the fields of sustainability, energy, defence and digitalisation; welcomes the Commission’s commitment to a new State aid framework to accompany the Clean Industrial Deal, so as to ensure competitiveness through mobilising the necessary public support for the energy transition to decarbonise EU industry, while ensuring that this does not hinder innovation, increase prices or reduce competition in the internal market; reiterates that State aid should not distort fair and effective competition;

    3.  Emphasises that the global strength and importance of the EU single market derives not only from its internal and external competitiveness but also from its ability to set common standards and guarantee territorial cohesion; notes that at the same time, policymakers should take due account of international regulatory and market developments and calls on the Commission to strive for continued dialogue and cooperation at international level, including via second-generation cooperation agreements that allow for more effective information exchange between competition authorities, and the development of influence on competition policy, globally; highlights the importance of the European Competition Network (ECN) and calls on the Commission to prioritise sustained constructive dialogue and cooperation, in this regard, at international level; calls for the coordination between national competition authorities to ensure the uniform application of competition rules and underlines the necessity of increasing collaboration between antitrust and other sectoral regulators;

    A competitive Union

    4.  Supports the Commission’s commitment to investing in sustainable competitiveness; welcomes the Draghi report’s emphasis on innovation, investments, market integration, decarbonisation and resilience, and the Letta report’s focus on integration, autonomy and solidarity; encourages policies that promote innovation, competitiveness and sustainable and inclusive growth;

    5.  Underlines the need for coordinated, targeted and truly European industrial policy to boost competitiveness; notes that this must not result in market dominance or abuse thereof, price distortion or economic inefficiencies, and points to the need for effective merger control procedures;

    6.  Considers that any State aid granted should be consistent with EU policy objectives; notes the Commission’s intention to provide guidance on the compatibility of State aid with innovation, climate and economic security considerations, as well as its actions to scale down and phase out fossil fuel subsidies under the Clean Industrial Deal, and encourages the Member States to consider the introduction of further conditions for the receipt of State aid; calls for companies structured through non-EU tax havens to be barred from receiving State aid; invites the Commission to investigate the lack of harmonisation of clawback mechanisms;

    7.  Takes note of the Commission’s report asserting that market concentration, markups and profits have increased over the past 25 years, while industry dynamism has decreased, despite the active enforcement of competition law; also takes note that this increase in markups was found to be driven by market share reallocation towards the largest firms; further notes that weak levels of competition have had significant negative impacts on consumers, purchasing power, and on the competitiveness of EU firms and overall economic growth; recalls that the application of competition law should focus on ensuring open, competitive markets free from anti-competitive practices;

    8.  Points out that State aid is increasingly used to support industrial policy objectives; recalls that such aid, as permitted under Article 107(3)(c) TFEU, must not adversely affect trading conditions or the common interest; notes the divergent fiscal capabilities of the Member States and warns that fragmented State aid creates an uneven playing field; calls on the Commission to monitor these effects and to ensure the integrity of the single market, which can be done through a common financing instrument for a European industrial policy, such as a European Competitiveness Fund, as proposed by Commission President von der Leyen in her political guidelines; calls on the Commission and the Member States not to engage in subsidy competition, which only exacerbates market distortions, notably when financing undertakings that are not efficient; concludes that temporary State aid frameworks have failed to prevent further market fragmentation and notes that only two of the Member States accounted for 77 % of State aid notified; calls for stricter State aid notification monitoring and enhanced State aid reporting and transparency, in line with the recommendations of the European Court of Auditors;

    9.   Underlines the importance of the important projects of common European interest (IPCEIs) for financing projects within the EU with a cross-border dimension; stresses that IPCEIs should have genuine EU added value, which means that they should have a positive impact on more than one Member State; calls on the Commission and the Member States to ensure that any such State aid notification is completed within six months at the latest;

    10.  Takes note of the Draghi report’s estimate that, in order to protect our EU competitiveness, an additional EUR 800 billion per year is needed; acknowledges the importance of public and private investment in this context; underlines that the EU budget needs to be properly equipped to that end; regards the completion of the Savings and Investments Union as important for mobilising private investment, addressing the fragmentation of the internal market and supporting the EU’s industrial strategy; acknowledges the urgent need for reforms alongside the effective implementation of the three action areas outlined in the Draghi report: (i) closing the innovation gap with the US and China; (ii) a common plan for decarbonisation and competitiveness to accelerate the energy transition and reduce energy costs; and (iii) enhancing security and reducing dependencies;

    11.  Welcomes the protection of the level playing field of European markets and European companies and their workers granted by anti-dumping measures that correct for distortive foreign State aid; calls on the Commission to make swift use of available trade instruments on procurement and foreign subsidies to prevent unfair competition in the internal market;

    Enforcement priorities

    12.  Observes changes in business practices, highlighting a decline in cartel cases; cautions, however, against new forms of harmful conduct like tacit collusion and algorithmic collusion, and emphasises the need to align enforcement priorities with this evolving landscape;

    13.  Notes the Draghi report’s proposal for a ‘new competition tool’ as a flexible market investigation tool designed to address structural competition problems that do not result from anti-competitive agreements or abuse of dominance, and to impose market-wide, forward-looking structural or behavioural remedies, including by lowering entry barriers for competitors, with the aim of increasing competitiveness, incentivising innovation and protecting vulnerable consumers; invites the Commission to analyse how this tool would complement the existing framework for sector investigations;

    14.  Recalls that under the Treaty, the Commission is empowered to address exploitative abuses;

    15.  Acknowledges the existence of a legal base for structural remedies against the abuse of market dominance; is aware that EU competition rules stipulate that structural remedies should only be used as a last resort if behavioural remedies have proven ineffective, but nonetheless regrets the reluctance of the Commission to address market dominance through structural remedies; reiterates its invitation to make better use of structural remedies and end the primacy given to behavioural remedies, and encourages further efforts to strengthen their application when necessary; calls on the Commission to make better use of the interim measures instrument to stop any practice that would seriously harm competition, particularly in relation to dynamic and rapidly developing markets such as digital markets;

    16.  Welcomes the priority given to housing by the 2024-2029 Commission; calls on the Commission to assess how EU competition principles affect the supply of services of general economic interest (SGEI); calls on the Commission to assess the position of social services of general interest and an SGEI exemption for affordable housing;

    17.  Stresses the importance of State aid as a tool for closing the economic gap between more developed EU regions and island areas, inland areas, outermost regions and economically depressed areas; recalls that allowing State aid in the context of SGEIs remains essential for the survival of these areas, especially in the context of State support dedicated to connectivity and other basic provisions of services for communities residing in isolated, remote or peripheral regions of the EU; calls on the Commission to investigate possibilities of further flexibility in providing funding to these regions;

    18.  Takes note of the recent Court of Justice of the European Union ruling which found that one of the Member States has failed to transpose the ECN+ Directive into national legislation; underlines the importance of transposing the ECN+ Directive fully; calls on all of the Member States to ensure a proper implementation of this Directive;

    Merger and antitrust

    19.  Notes with concern the Court of Justice of the European Union’s interpretation of Article 22 of the EC Merger Regulation in Case C-611/22 P (Illumina v Commission), rescinding the Commission’s approach of accepting referrals of non-notifiable deals; acknowledges that the EC Merger Regulation does not provide the Commission with sufficient tools for dealing with killer acquisitions; strongly believes that the impact of merger decisions on the internal market justifies the inclusion of an internal market legal base in the EC Merger Regulation, so as to fully involve co-legislators, in a manner similar to that of the Digital Markets Act (DMA); calls on the Commission to require Member States that have or can claim the relevant competence to examine potential killer acquisitions in the light of their national merger control laws, and to continue to refer those deals in accordance with Article 22 of the EC Merger Regulation; calls on the Commission to explore the possibility of reviewing the EC Merger Regulation to be able to examine mergers that fall below EU or national thresholds, regardless of the sectors involved;

    20.  Notes that since the 2004 entry into force of the EC Merger Regulation, 0,7 % of notified mergers have been either blocked by the Commission or withdrawn following an investigation;

    21.  Notes that the turnover thresholds in the EC Merger Regulation alone might not be suitable for detecting all cases that should be reviewed by the competition authorities; highlights practices used by dominant firms to avoid formal investigations, such as the growing use of ‘partnerships’ in the AI sector, which further suggests that a review of the EU Merger Regulation is necessary;

    22.  Welcomes the Draghi report’s proposal for an ‘innovation defence’ in cases where a merger increases the ability and incentive to innovate, and invites the Commission to analyse and further develop this concept; furthermore calls for matters of public interest, such as the impact on workers, to be taken into account;

    23.  Asks the Commission to identify the national barriers that may prevent it from considering the EU market as the relevant one in its analyses of mergers; calls on the Commission to present a legislative proposal to remove these impediments; notes that the international environment needs to be carefully analysed when deciding on the definition of the relevant market in competition and merger control cases; calls on the Commission to adopt a forward-looking approach to consolidation in the EU where appropriate, as also proposed by the Draghi and Letta reports, taking into account the strategic importance and pro-competitive impact of scale and favourable investment conditions in certain sectors for driving innovation and long-term competition;

    24.  Calls for merger assessment frameworks to be updated to reflect the realities of the digital economy, where market power can be manifested in ways beyond traditional market share in clearly delineated markets; supports the development of advanced methodologies for analysing data-driven dominance and network effects, emphasising the critical role of consumer choice in selecting digital services and devices; encourages the Commission to enhance mechanisms enabling interoperability across services and devices, fostering innovation and competition in the digital ecosystem; urges the Commission to progress swiftly on the implementation of the existing interoperability obligations for messaging services under the DMA, the existing interoperability obligations for cloud providers under the Data Act and to start work on the review of the DMA for May 2026; urges the Commission to implement existing interoperability obligations under the DMA and look into extending interoperability obligations to online social networking services; supports the Commission in taking more account of the potential harm to competition when assessing mergers where expansion into adjacent markets would have the effect of further strengthening market dominance in the acquiring company’s core market;

    25.  Calls on the Commission to address excessively long antitrust investigations during which companies continue to benefit from their anticompetitive practices; calls on the Commission to set appropriate time limits for antitrust cases and ensure an effective follow-through of decisions taken; calls on the Commission to adopt further interim measures to stop any practice which would seriously harm competition, particularly in relation to dynamic and rapidly developing markets such as digital markets;

    Sectoral policies

    26.  Welcomes the two September 2024 landmark judgments by the Court of Justice confirming the Commission’s assertion that the Irish tax deal with Apple constitutes illegal State aid and that Google abused its dominant position in contravention of the Treaties; acknowledges that the legal framework in Ireland has since changed; encourages the Commission to continue the clamp down on State aid abuses involving the selective granting of tax breaks to companies;

    27.  Notes the detrimental effect of international tax competition; recalls its support for the implementation of Pillar Two of the Organisation for Economic Co-operation and Development (OECD); deeply regrets the US presidential Executive Order of 20 January 2025 which asserts that the OECD global tax agreement has ‘no force or effect within the United States’; stresses the importance of multilateralism in ensuring that multinationals pay their fair share of taxation where value is created; takes the view that the EU should fully stand by the OECD’s Pillar Two Directive;

    28.  Emphasises the worrying market concentrations in various digital markets, such as social media, search engines, AI, cloud services, e-commerce, microchips and online advertising; underlines the actual and potential negative impact on EU competitiveness, the resilience of supply chains, media freedom, privacy and data protection, society and democracy; urges the Commission to address issues that are specific to the tech market, including infrastructural power in hardware and cloud computing layers, vertical concentration, algorithmic manipulation of the digital public sphere and market leveraging in digital markets, as demonstrated by the progress made under the DMA; additionally calls for the opening of new investigations into the cloud services sector to further ensure fair competition and innovation, taking into account the degree of market concentration in this sector and anticompetitive practices related to complex and non-transparent licensing terms or forced bundling; furthermore, urges the Commission to address the increasing vertical concentration of dominant players across the advertising value chain, which puts the EU online advertising sector at risk;

    29.  Notes the rapid development of AI services, which has the potential to result in market concentration; calls on the Commission to take an ecosystemic approach towards this sector, including by developing and applying new theories of harm to address the further entrenchment of the dominant players in this sector; highlights that the DMA contains several provisions that must be used to prevent gatekeepers from restricting emerging AI developers, and asks the Commission to act swiftly to address the risk of consumers being forced into using pre-determined AI services on their mobile devices, ensuring that AI systems remain user-selectable and transparent, thereby safeguarding competition and consumer choice; calls on the Commission to explore the possibility of adding generative AI as a new core platform service under the DMA;

    30.  Notes that large digital players use their market power, power over consumers, financial resources and data concentration in one market to leverage their position in another; stresses that small players cannot compete with the aforementioned factors, which makes EU citizens even more dependent on the same small number of non-EU companies and endangers strategic autonomy; calls for increased scrutiny of the leveraging of position by dominant digital sector players into other sectors and the EU’s strategic autonomy, through a revision of the merger guidelines to ensure that market leveraging can be scrutinised more effectively;

    31.  Notes the importance of data and data analytics tools as one of the deterring factors for digital market concentrations and acquisitions in the digital sector; calls for an opinion of the European Data Protection Board in cases of concentrations involving one or more operators in digital sectors on the relevance of datasets for the intended concentration, the personal data the target acquisition processes and the potential impact on the rights to privacy and data protection the intended concentration has;

    32.  Expresses concern regarding the growing use of dynamic pricing mechanisms across the EU; calls on the Commission to explore regulatory measures against highly adaptive and opaque pricing methods;

    33.  Calls on the Commission to vigorously enforce all competition rules, including the Foreign Subsidies Regulation and the DMA, in order to address gatekeeper practices and foster contestable markets and fair competition; stresses that the Commission must have sufficient staff for enforcement, while noting that new tools, as well as scientists and economists stemming from divergent disciplines, can work to improve competition law enforcement; underlines in particular that the DMA should be applied rigorously and independently, without any undermining by external pressures; stresses that the DMA and potential fines must not be used as a bargaining chip in relation to discussions on tariffs, but as a cornerstone of the EU’s efforts to ensure fair and competitive digital markets; notes the six non-compliance procedures launched against some designated gatekeepers; is deeply concerned about potential delays in critical investigations and the capacity of the Commission to respect their ‘best effort’ obligations and to make a decision on non-compliance procedures without undue delay;

    34.  Notes with concern the fragmentation in numerous consumer markets, including financial services, telecoms and household energy, and calls for faster and greater market integration where there are benefits for consumers, and for recognition that this market integration can drive investment and innovation;

    35.  Expresses alarm at the high concentration in the retail, agricultural and automotive sectors in overseas territories whereby excessive prices set by dominant undertakings on essential products and services amplify inequalities, precariousness and territorial disparities; calls on the Commission to launch an investigation into potential abuses of dominant position under Article 102 TFEU;

    36.  Notes with concern the high degree of market concentration in the European financial sector, as well as its sustained over-reliance on a limited number of non-EU service providers; notes that the three largest credit rating agencies still hold a market share of over 90 %; expresses concern about the continued high concentration in the public interest entities (PIE) audit market, with four firms mainly holding the vast majority of EU revenues for PIE audits, limiting choice and risking supervisory capture; invites the Commission to present an impact assessment on options to address these concerns; urges the Commission to carefully assess public tenders for expertise from audit market participants so that potential conflicts of interest are avoided;

    37.  Expresses concern about the food price crisis and notes, in this regard, the high levels of market concentration in food supply chains; reiterates its call for the Commission to urgently conduct a thorough analysis of the extent and effect of buying alliances, thereby devoting special attention to guaranteeing fair competition and greater transparency in supermarket and hypermarket chains’ commercial practices, particularly where such practices affect brand value and product choice or limit innovation or price comparability; recalls, in this light, the market concentration in agri-commodity trading wherein four companies account for the vast majority of the global crop trade; regrets that the Commission nonetheless conditionally approved the 2024 Bunge-Viterra merger (M.11204) despite competition concerns; asks the Commission to address excessive power accumulation in the hands of a few large players in this market, in order to strengthen the bargaining position of farmers and consumers alike; highlights the implementation of the New Competition Tool in this context;

    38.  Notes the high-net profits of EU banks during this inflationary period, mostly driven by the delayed pass-through of the rapid monetary policy tightening to deposit rates;

    39.  Notes with particular concern the dominant position of two international card schemes in the EU payments market, and their engagement in practices that reinforce and extend their dominance of this market, potentially further increasing barriers to entry and hampering long-term innovation(6), as well as leading to higher costs for EU businesses and ultimately consumers; calls on the Commission to take decisive actions, emphasising the need for a review of the Interchange Fee Regulation (Regulation (EU) 2015/751) to tackle the significant increase in card scheme fees charged by international card schemes and to ensure a fair, competitive and transparent market environment;

    Parliamentary involvement

    40.  Stresses that Parliament should be sufficiently involved in shaping competition policy; cautions against the over-reliance on soft-law instruments, such as guidance and temporary frameworks, in which Parliament’s involvement is limited; calls on the Commission to enter into negotiation for an interinstitutional agreement on competition policy to formalise its enforcement priorities to Parliament; calls on the European Council to adopt a decision under Article 48(7) TEU allowing for the adoption of legislative acts in the area of competition policy in accordance with the ordinary legislative procedure; stresses that Parliament should be more involved in the activity of working parties and expert groups in the International Competition Network and the OECD as an observer, and also in the High-Level Group on the DMA;

    41.  Calls on the responsible Executive Vice-President, also Commissioner in charge of competition policy to maintain close contact with Parliament’s competent committee and its working group on competition issues;

    o
    o   o

    42.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 024, 29.1.2004, p. 1, ELI: http://data.europa.eu/eli/reg/2004/139/oj.
    (2) OJ L 114, 12.4.2022, p. 22, ELI: http://data.europa.eu/eli/dec/2022/591/oj.
    (3) Judgment of the Court of Justice of 3 September 2024, Illumina v Commission, C-611/22 P, ECLI:EU:C:2024:677.
    (4) Judgment of the Court of Justice of 10 September 2024, European Commission v Ireland and Others, C-465/20 P, ECLI:EU:C:2024:724.
    (5) Judgment of the Court of Justice of 10 September 2024, Google and Alphabet v Commission, C-48/22 P, CLI:EU:C:2024:726.
    (6) European Court of Auditors, Special Report: ‘Digital payments in the EU – Progress towards making them safer, faster, and less expensive, despite remaining gaps’, 9 January 2025, https://www.eca.europa.eu/ECAPublications/SR-2025-01/SR-2025-01_EN.pdf.

    MIL OSI Europe News

  • MIL-OSI Security: ICE Arrests ‘Worst of the Worst’ Criminal Aliens in Hawaii

    Source: US Department of Homeland Security

    Targets of the operation in Hawaii included criminal illegal aliens charged with kidnapping, assault, firearms offenses, drug offenses and theft. 

    WASHINGTON – The Department of Homeland Security (DHS) announced Immigration and Customs Enforcement (ICE) has successfully detained and removed criminal illegal aliens across the U.S. including from the Hawaiian Islands.  

    Homeland Security Investigations (HSI) agents in Kona have conducted search warrants, unaccompanied minor welfare checks, and a number of targeted enforcement actions.   

    “Our brave ICE agents are conducting operations in Hawaii to protect communities from violent criminals who shouldn’t be in our country. The targets of the operation in Hawaii include criminal illegal aliens charged with kidnapping, assault, distribution of deadly drugs, domestic abuse, and theft,” said Assistant Secretary Tricia McLaughlin. “In the first 100 days under President Trump and Secretary Noem, 75% of arrests ICE made were of criminal illegal aliens. DHS is continuing to go after the worst of the worst.”  

    Below are examples of the illegal aliens ICE has removed from American communities:  

    On January 23, 2025, HSI Honolulu administratively arrested Rescue Suda, a citizen of the Marshall Islands. The Circuit Court of Hawaii County, Hawaii previously convicted Suda of Felony Assault. Suda was also arrested for kidnapping and terroristic threatening.   

    On February 25, 2025, HSI Honolulu arrested Navor Salas-Cruz, 52, a citizen of Mexico. Salas-Cruz was identified as being present in the United States after a prior order of removal. Salas-Cruz has multiple immigration encounters starting in 1996 including 2 prior removals and has a lengthy state criminal history ranging from assault, DWI, forgery, driving without a license, criminal contempt of court, family abuse. Federal charges include 8 U.S.C. § 1326(a) and 18 U.S.C § 922(g)(l) for one count of reentry of removed alien and one count of felon in possession of firearms and ammunition.  

    On January 25, 2025, HSI Honolulu arrested RJ Marsolo, a citizen of the Federated States of Micronesia.  The State of Hawaii, Circuit Court of the First Circuit, previously convicted Marsolo of assault in the first degree and assault in the third degree and sentenced him to a total of 10 years imprisonment.   

    On January 25, 2025, HSI Honolulu arrested Herman Faamausili, A citizen of Samoa.  The United States District Court, District of Hawaii, previously convicted Faamausili of distribution and possession with intent to distribute 50 grams or more of a mixture or substance containing methamphetamine and sentenced him to 70 months imprisonment.  The immigration judge ordered Faamausili’s previous removal from the United States on September 15, 2021.   

    On January 26, 2025, HSI Honolulu arrested Heine a citizen of the Federated States of Micronesia. The Superior Court of Guam convicted JAI of theft by receiving, sentencing him to 5 years in prison, and assault, sentencing him to 1 year in prison.  The immigration judge previously ordered JAI’s removal from the United States on April 16, 2020. 

    MIL Security OSI

  • MIL-OSI: ProvisionAi Launches Make-n-Ship—A Breakthrough AutoO2 Capability for Optimizing Factory Shipments in Tight Dock Environments

    Source: GlobeNewswire (MIL-OSI)

    FRANKLIN, Tenn., May 12, 2025 (GLOBE NEWSWIRE) — ProvisionAi, with patented AI-powered transportation optimization, today announced the launch of Make-n-Ship, a powerful new capability in its AutoO2 platform. Designed specifically for factories with minimal or no buffer space between production lines and shipping docks, Make-n-Ship enables intelligent shipment building that reduces transportation costs and deploys the right product to the right place.

    Traditional load planning systems assume flexibility regarding when and where goods can be staged prior to shipment. However, many manufacturing plants operate in environments where finished goods must go directly from the line to the trailer. Make-n-Ship addresses this challenge by leveraging real-time production schedules, utilizing every inch of available staging space, and optimizing load configurations to align with supply plan priorities.

    “Factories with little or no storage space have been forced to make trade-offs between operational feasibility and transportation efficiency,” said Tom Moore, CEO of ProvisionAi. “Make-n-Ship eliminates that compromise. It dynamically adapts to the production reality, respects the uncertainty in attainment, and still finds a way to maximize trailer fill and minimize freight spend.

    The Make-n-Ship capability ensures that the product is deployed to the site that needs it most by closely aligning shipments with the supply plan’s prioritization logic. If a production run is cut short, Make-n-Ship automatically creates the shipment plan to send available product to the highest-need destinations first—those at greatest risk of stockout or those most critical to downstream operations. Conversely, if production exceeds requirements, the system applies customizable business rules to smartly offload the excess, for example, replenishing nearby hubs or “fair sharing” the excess, ensuring the dock stays clear without disrupting the broader supply chain plan.

    Key features of Make-n-Ship include:

    • Intelligent staging space utilization, making optimal use of constrained buffer zones without requiring manual intervention.
    • Alignment with supply plan priorities, ensuring that the most critical products ship first—even when production variability occurs.
    • Optimization of shipment size and mode, reducing transportation costs while improving service levels.

    This enhancement is now available to all AutoO2 customers and can be implemented with minimal disruption. Companies in food, beverage, consumer products, and other high-volume industries will particularly benefit from this capability where dock congestion and inventory precision are mission-critical.

    To learn more about Make-n-Ship and how AutoO2 can transform your factory shipments, contact sales@provisionai.com.

    About ProvisionAi
    ProvisionAi is the creator of LevelLoad and AutoO2, the only patented solution that seamlessly links supply planning with transportation execution to optimize truckload efficiency and reduce costs. Trusted by Fortune 500 manufacturers and logistics teams, ProvisionAi helps unlock hidden savings and deliver supply chain sustainability at scale.

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    The MIL Network

  • MIL-OSI Asia-Pac: Multiple agreements reached in Qatar

    Source: Hong Kong Information Services

    Continuing his visit to Qatar, Chief Executive John Lee today met local government and business leaders there, and witnessed the reaching of 35 agreements or memoranda of understanding among government departments, enterprises and institutions from Hong Kong, the Mainland and Qatar.

     

    In the morning, Mr Lee met Qatar’s Minister of Labour Ali bin Saeed bin Samikh Al Marri to discuss plans for enhancing talent exchanges. Highlighting that Hong Kong is home to five of the world’s top 100 universities and is on a path to become an international hub for post-secondary education, Mr Lee emphasised that the city offers a Belt & Road Scholarship to encourage students from countries or regions in the Belt & Road Initiative to pursue studies in the city. He invited more young people from Qatar to study in Hong Kong and develop careers in the city.

     

    Afterwards, the Chief Executive and members of his delegation attended a roundtable meeting with representatives of the Qatari Businessmen Association and the Qatar Chamber of Commerce & Industry.

     

    Extolling Hong Kong’s robust legal system, resilient financial system and simple and low tax regime, Mr Lee said he welcomed Qatari enterprises to capitalise on the city’s advantages in connecting with both Mainland China and other parts of the world under the “one country, two systems” principle. He added that Qatari enterprises can leverage Hong Kong’s financial, logistics and professional services, and its bridging roles, to tap into the Mainland market.

     

    In the afternoon, Mr Lee attended a business lunch where he spoke of Hong Kong’s development opportunities and business advantages to over 300 local political and business representatives.

     

    He also took the opportunity to announce that Hong Kong and Qatar have substantially concluded negotiations on an Investment Promotion & Protection Agreement, and will begin discussions on mutual recognition arrangements for their respective Authorized Economic Operator Programmes, in order to create a more favourable environment for the flow of capital and goods.

     

    In addition, the Chief Executive revealed that Hong Kong Special Administrative Region passport holders can visit Qatar visa-free for up to 30 days. He said he looks forward to deepening co-operation with Qatar, adding that Hong Kong and Qatar can jointly seize development opportunities brought by the Greater Bay Area and the Belt & Road Initiative.

     

    Government departments, enterprises and institutions from Hong Kong, the Mainland and Qatar also announced 35 memoranda of understanding or agreements covering economic co-operation, investment, technology, legal collaboration, finance, banking, and capital market development.

     

    Besides co-operation between Hong Kong and Qatar, two agreements were signed directly between Mainland and Qatari enterprises to foster co-operation in financial services and high-end manufacturing. A tripartite agreement was also signed among Hong Kong, the Mainland and Qatar to strengthen co-operation in fintech, covering Web3 and artificial intelligence.

     

    After the lunch event, Mr Lee visited Hamad International Airport in Doha to learn about an autonomous vehicle pilot project there.

     

    The project involves participation by UISEE, a Mainland Chinese enterprise which has established its international headquarters in Hong Kong. Having also collaborated with Hong Kong International Airport on autonomous vehicle projects, UISEE has drawn on those experiences to promote its technology to overseas clients.

     

    Mr Lee and the delegation will depart for Kuwait tonight.

    MIL OSI Asia Pacific News