GERMANY Law and Practice Contributed by: Bettina Mertgen, Felix Siebler, Michael Herold and Sebastian Faust, GvW Graf von Westphalen
regimes targeting Russia and Belarus. These measures have increased compliance expectations for defence companies and have led to heightened enforcement activity focusing on circumvention, intermediary juris - dictions and export control evasion. Businesses are facing increased scrutiny regarding supply chains, end users and the potential diversion of controlled goods and technologies. Consequently, sanctions and export control compliance remain a major enforcement priority for German authorities. 5. National Security Regulation 5.1 National Security Legislation Applicable to the Defence Sector Germany’s defence sector is mainly regulated by the Foreign Trade and Payments Act, the Foreign Trade and Payments Ordinance, the War Weapons Control Act, foreign investment screening rules and cybersecurity legislation (Act on the Federal Office for Information Security ( Gesetz über das Bundesamt für Sicherheit in der Informationstechnik – BSIG, or “BSI Act”)). These laws govern exports of military and dual-use goods, sanctions compliance, foreign acqui - sitions of defence businesses, cybersecurity obliga - tions, and the manufacture, transfer and possession of war weapons. Key authorities include the Federal Ministry for Eco - nomic Affairs and Energy, which oversees trade con - trols and investment screening; the Federal Office for Economic Affairs and Export Control, which issues export licences and enforces export control rules; the Federal Ministry of Defence; the Federal Office for Information Security (BSI), responsible for cyberse - curity oversight; and the German Customs Adminis - tration, which enforces export-control and sanctions laws at the border. 5.2 Security Vetting and Clearance Requirements Access to classified information in Germany’s defence sector is governed by the Security Clearance Act ( Sicherheitsüberprüfungsgesetz – SÜG) and related regulations. Individuals, including employees and contractors, must undergo security vetting, with dif -
ferent clearance levels depending on the sensitivity of the information. Vetting may include background checks, criminal record reviews and reliability assess - ments. Defence contractors involved in classified projects may also require facility security clearances, demon - strating adequate physical, organisational and infor - mation security measures. Security clearances are granted by the competent federal authority, with assessments conducted by the Federal Office for the Protection of the Constitution (BfV) or, for military matters, the Military Counterintel - ligence Service (MAD). The process includes consent, security questionnaires, background investigations and periodic reviews. Clearances may be revoked if security concerns arise. 5.3 Classified Information and Official Secrets In Germany, classified information is regulated by the Security Clearance Act and the Classified Information Instructions (VSA). Access is granted only on a need- to-know basis and generally requires an appropriate security clearance. Defence contractors working on classified projects must implement adequate physical, organisational and IT security measures. Their personnel may be required to undergo security vetting before access - ing classified information. The Federal Office for the Protection of the Constitu - tion and the Military Counterintelligence Service sup - port security assessments and oversight. Unauthorised disclosure of classified information can lead to administrative, civil and criminal penalties. 5.4 Critical National Infrastructure and Defence Assets Germany designates certain defence-related facilities, information systems and suppliers as part of its criti - cal infrastructure ( Kritische Infrastrukturen ) framework, particularly where their disruption could affect national security, military readiness or essential government functions. The framework is primarily based on the BSI Act and related regulations.
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