Article 12 — Industrial reinforcement actions

1. Industrial reinforcement actions shall consist of activities related to accelerating the adjustment to structural changes of the production capacity of defence products, including their components and corresponding raw materials insofar as they are intended or used wholly for the production of defence products, in particular: (a) the optimisation, expansion, modernisation, including automation, upgrading or repurposing of existing, or the establishment of new, production capacity of defence products, components and corresponding raw materials, including on the basis of the procurement or acquisition of the requisite machine tools and any other necessary input; (b) the establishment of cross-border industrial partnerships, including through public-private partnerships or other forms of industrial cooperation including SMEs and small mid-caps, in a joint industrial effort, including activities that aim to coordinate the sourcing or reservation and stockpiling of defence products, components and corresponding raw materials and to coordinate production capacities and production plans; (c) the building-up and making available of reserved surge manufacturing capacities of defence products, their components and corresponding raw materials, in accordance with ordered or planned production volumes; (d) fostering the industrialisation and commercialisation of defence products developed in the framework of actions funded by the Union or of other cooperative activities conducted with support by at least two Member States, including through the establishment of cross-border industrial partnerships, public-private partnerships or other forms of industrial cooperation and through the ramping-up of initial production and of licensing production, where appropriate; (e) the testing, including the necessary infrastructure, and, as appropriate, reconditioning certification of defence products with a view to addressing their obsolescence and making them useable by end-users. 2. For activities referred to in paragraph 1, point (d), the action shall be carried out by legal entities cooperating within a consortium of at least three eligible legal entities, of which at least two shall be established in different Member States. At least three of those eligible legal entities established in at least two different Member States shall not, during the entire period in which the action is carried out, be controlled, directly or indirectly, by the same legal entity and shall not control each other. 3. Notwithstanding paragraph 2, the activities referred to in paragraph 1 may be carried out by a SEAP. 4. For the production of ammunition and missiles, recipients of Union funding or relevant governmental authorities of the Member States concerned shall have the ability to decide, without restrictions imposed by non-associated third countries or by non-associated third-country entities, on the definition, adaptation and evolution of the design of the defence product concerned, including the legal authority to substitute or remove components that are subject to restrictions imposed by non-associated third countries or by non-associated third-country entities, or alternatively, by way of derogation from Article 10(5), shall have obtained a legally binding commitment from the non-associated third country or the non-associated third-country entity concerned that they will obtain such ability to decide within a reasonable timeframe commensurate with the complexity of the action concerned, and in any event no later than 31 December 2033.