EU defence ministers have said they are keen to see more work done on a new fund for military research in Europe.
The fund would draw money from member states and be run by a central body, the European Defence Agency (EDA).
The UK Defence Secretary John Reid said the move would encourage other EU countries to pay more for joint ventures in research and technology.
European Union officials say this is a significant moment in the development of European defence policy.
"Any mechanism that persuades, encourages, cajoles others to spend money on research and development is well worth it"
What is proposed here is for member states to fund broader defence projects, such as how to reduce battlefield casualties.
Those member states would retain oversight of the project but it would be co-ordinated by the EU's own EDA.
Nato partnership
The British defence secretary said it made sense for as many EU countries as possible to share the costs and risks of this type of research.
"At present about 75% of all the money spent on research and development is spent by the British and the French.
"So any mechanism that persuades, encourages, cajoles others to spend money on research and development is well worth it," Mr Reid said.
However, the opposition Conservative Party in Britain has warned this fund could duplicate the work of Nato and undermine UK military relations with America.
EU defence officials insist this is work in partnership with Nato.
They argue that at the moment the US spends five times as much as the whole of Europe on military research and technology.
The EDA, they say, could make that much smaller amount of European money go a lot further.
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