INTRODUCTION Contributed by: Andrew Sanderson, Kingsley Napley LLP
Defence Contracts 2026 Global Overview Welcome to the 2026 edition of the Chambers Glob - al Practice Guide to Defence Contracts. This guide arrives at a moment when defence procurement has moved from a specialist area of public contracting to a central instrument of national security, industrial pol - icy and international co-operation. Governments are seeking to replenish stocks, strengthen deterrence, protect critical infrastructure and adopt new technolo - gies at a pace rarely seen in recent decades. Suppli - ers, investors and advisers therefore face a market of exceptional opportunity, but also one in which politi - cal sensitivity, legal complexity and delivery risk are unusually high. The chapters that follow explain how these pres - sures are expressed through different legal systems. Although the rules vary, the same questions recur: who may compete, how security and sovereignty shape procurement, what information may cross borders, how governments allocate risk, and how contractors can deliver at speed without compromising integrity or accountability. This introduction draws those threads together and identifies the issues that businesses should consider before entering a new defence mar - ket or expanding an established presence. A market shaped by strategic urgency The defining context for defence contracting in 2026 is sustained geopolitical instability. Russia’s continu - ing war against Ukraine, conflict and volatility in the Middle East, strategic competition in the Indo-Pacific, terrorism, cyber operations and threats to space and subsea infrastructure have altered assumptions about readiness. Governments are no longer procuring only for long-term modernisation. They are also buying for immediate availability, stockpile depth, resilience and the ability to sustain operations over time. The scale of the change is significant. The Stock - holm International Peace Research Institute (SIPRI) reported that global military expenditure reached USD2.718 trillion in 2024 after a decade of consecu - tive increases, with spending rising in every region. In 2025, NATO allies committed to invest 5% of GDP annually by 2035 in core defence requirements and wider defence- and security-related expenditure. The European Union has added new financial and indus -
trial instruments, including the EUR150 billion SAFE (Security Action for Europe) loan mechanism for joint procurement. Comparable efforts to increase capabil - ity, domestic production and supply-chain security are visible across North America, the Indo-Pacific and the Middle East. Larger budgets do not, however, guarantee rapid or effective delivery. Public finances remain constrained, inflation has increased programme costs, and compe - tition for skilled labour, production capacity and criti - cal inputs is intense. Buyers are under political pres - sure to demonstrate value, speed and national benefit at the same time. Contractors should expect closer scrutiny of price, performance, delivery schedules and economic contribution, even where urgency permits accelerated or non-competitive procedures. Procurement at speed and the continuing importance of process Many jurisdictions are reforming procurement rules, shortening competitions and using framework agree - ments, direct awards, government-to-government arrangements and urgent operational requirements. Agile acquisition models, spiral development and experimentation are increasingly used where tech - nology changes too quickly for a conventional multi- year specification. These approaches can give new entrants and smaller businesses routes into pro - grammes that were once dominated by established prime contractors. Urgency does not remove public-law risk. Decisions may still be challenged for unequal treatment, lack of transparency, improper evaluation or misuse of a national-security exemption. The boundary between legitimate security protection and unjustified restric - tion of competition remains important. A supplier must understand not only the written tender rules, but also the authority of the purchasing body, applicable review mechanisms, standstill or protest procedures, and the practical consequences of challenging a strategically important award. Early engagement is especially valuable. Pre-market consultations, capability demonstrations and industry days can influence how a requirement is framed, but communications must be controlled to avoid unequal
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