FantasticSearch

1. PURPOSE 2. STATUS 3. PARTICIPATION 4. INFORMATION AVAILABLE TO NON-PARTICIPANTS 5. SCOPE OF APPLICATION 6. PROHIBITIONS ON ARRANGEMENT SUPPORT 7. SECTOR UNDERSTANDINGS 8. WITHDRAWAL 9. MONITORING CHAPTER II: FINANCIAL TERMS AND CONDITIONS FOR EXPORT CREDITS 10. CLASSIFICATION OF COUNTRIES FOR LOCAL COSTS SUPPORT 11. DOWN PAYMENT, MAXIMUM OFFICIAL SUPPORT AND LOCAL COSTS 12. MAXIMUM REPAYMENT TERMS 13. REPAYMENT OF PRINCIPAL AND PAYMENT OF INTEREST 14. INTEREST RATES, PREMIUM RATES AND OTHER FEES 15. VALIDITY PERIOD FOR EXPORT CREDITS 16. ACTION TO AVOID OR MINIMISE LOSSES 17. MATCHING 18. MINIMUM FIXED INTEREST RATES UNDER OFFICIAL FINANCING SUPPORT 19. CONSTRUCTION AND APPLICATION OF CIRRs 20. PREMIUM FOR CREDIT RISK 21. MINIMUM PREMIUM RATES FOR CREDIT RISK 22. COUNTRY RISK CLASSIFICATION 23. SOVEREIGN RISK ASSESSMENT 24. BUYER RISK CLASSIFICATION 25. PERCENTAGE AND QUALITY OF OFFICIAL EXPORT CREDIT COVER 26. COUNTRY RISK MITIGATION TECHNIQUES 27. BUYER RISK CREDIT ENHANCEMENTS 28. VALIDITY OF THE MINIMUM PREMIUM RATES FOR CREDIT RISK CHAPTER III: PROVISIONS FOR TIED AID 29. GENERAL PRINCIPLES 30. FORMS OF TIED AID 31. ASSOCIATED FINANCING 32. COUNTRY ELIGIBILITY FOR TIED AID 33. PROJECT ELIGIBILITY 34. MINIMUM CONCESSIONALITY LEVEL 35. EXEMPTIONS FROM COUNTRY OR PROJECT ELIGIBILITY FOR TIED AID 36. CALCULATION OF CONCESSIONALITY LEVEL OF TIED AID 37. VALIDITY PERIOD FOR TIED AID 38. MATCHING CHAPTER IV: PROCEDURES SECTION 1: COMMON PROCEDURES FOR EXPORT CREDITS AND TRADE-RELATED AID 39. NOTIFICATIONS 40. INFORMATION ON OFFICIAL SUPPORT 41. PROCEDURES FOR MATCHING 42. SPECIAL CONSULTATIONS SECTION 2: PROCEDURES FOR EXPORT CREDITS 43. PRIOR NOTIFICATION WITH DISCUSSION 44. PRIOR NOTIFICATION SECTION 3: PROCEDURES FOR TRADE-RELATED AID 45. PRIOR NOTIFICATION 46. PROMPT NOTIFICATION SECTION 4: CONSULTATION PROCEDURES FOR TIED AID 47. PURPOSE OF CONSULTATIONS 48. SCOPE AND TIMING OF CONSULTATIONS 49. OUTCOME OF CONSULTATIONS SECTION 5: INFORMATION EXCHANGE FOR EXPORT CREDITS AND TRADE-RELATED AID 50. CONTACT POINTS 51. SCOPE OF ENQUIRIES 52. SCOPE OF RESPONSES 53. FACE-TO-FACE CONSULTATIONS 54. PROCEDURES AND FORMAT OF COMMON LINES 55. RESPONSES TO COMMON LINE PROPOSALS 56. ACCEPTANCE OF COMMON LINES 57. DISAGREEMENT ON COMMON LINES 58. EFFECTIVE DATE OF COMMON LINE 59. VALIDITY OF COMMON LINES SECTION 6: REVIEWS 60. REGULAR REVIEW OF THE ARRANGEMENT 61. REVIEW OF MINIMUM INTEREST RATES 62. REVIEW OF MINIMUM PREMIUM RATES AND RELATED ISSUES 63. REVIEW OF OFFICIAL SUPPORT FOR LOCAL COSTS 64. REVIEW OF REPAYMENT PROFILES AND TERMS ANNEX I: SECTOR UNDERSTANDING ON EXPORT CREDITS FOR CLIMATE CHANGE ANNEX II: SECTOR UNDERSTANDING ON EXPORT CREDITS FOR NUCLEAR POWER PLANTS ANNEX III: SECTOR UNDERSTANDING ON EXPORT CREDITS FOR CIVIL AIRCRAFT PART 1: GENERAL PROVISIONS 1. PURPOSE 2. STATUS 3. PARTICIPATION 4. SCOPE OF APPLICATION 5. INFORMATION AVAILABLE TO NON-PARTICIPANTS 6. AID SUPPORT 7. ACTIONS TO AVOID OR MINIMISE LOSSES PART 2: NEW AIRCRAFT CHAPTER I: COVERAGE 8. NEW AIRCRAFT CHAPTER II: FINANCIAL TERMS AND CONDITIONS 9. ELIGIBLE CURRENCIES 10. DOWN PAYMENT AND MAXIMUM OFFICIAL SUPPORT 11. MINIMUM PREMIUM RATES 12. MAXIMUM REPAYMENT TERM 13. REPAYMENT OF PRINCIPAL AND PAYMENT OF INTEREST 14. MINIMUM INTEREST RATES 15. INTEREST RATE SUPPORT 16. FEES 17. CO-FINANCING PART 3: USED AIRCRAFT, SPARE ENGINES, SPARE PARTS, MAINTENANCE AND SERVICE CONTRACTS CHAPTER I: COVERAGE 18. USED AIRCRAFT AND OTHER GOODS AND SERVICES CHAPTER II: FINANCIAL TERMS AND CONDITIONS 19. SALE OF USED AIRCRAFT 20. SPARE ENGINES AND SPARE PARTS 21. CONTRACTS FOR CONVERSION/MAJOR MODIFICATION/REFURBISHING 22. MAINTENANCE AND SERVICE CONTRACTS 23. ENGINE KITS PART 4: TRANSPARENCY PROCEDURES 24. INFORMATION ON OFFICIAL SUPPORT 25. REQUESTS FOR INFORMATION 26. FACE-TO-FACE CONSULTATIONS 27. SPECIAL CONSULTATIONS 28. PROCEDURES AND FORMAT OF COMMON LINES 29. RESPONSES TO COMMON LINE PROPOSALS 30. ACCEPTANCE OF COMMON LINES 31. DISAGREEMENT ON COMMON LINES 32. EFFECTIVE DATE OF COMMON LINE 33. VALIDITY OF COMMON LINES 34. MATCHING PART 5: MONITORING AND REVIEW 35. MONITORING 36. REVIEW 37. FUTURE WORK PART 6: FINAL PROVISIONS 38. ENTRY INTO FORCE 39. WITHDRAWAL APPENDIX I PARTICIPATION IN THE AIRCRAFT SECTOR UNDERSTANDING APPENDIX II MINIMUM PREMIUM RATES ANNEX 1: QUALIFYING DECLARATIONS ANNEX 2: CAPE TOWN CONVENTION QUESTIONNAIRE APPENDIX III MINIMUM INTEREST RATES APPENDIX IV REPORTING FORM APPENDIX V LIST OF DEFINITIONS ANNEX IV: SECTOR UNDERSTANDING ON EXPORT CREDITS FOR SHIPS ANNEX V: INFORMATION TO BE PROVIDED FOR NOTIFICATIONS ANNEX VI: CALCULATION OF THE MINIMUM PREMIUM RATES FOR COUNTRY RISK CATEGORY 1-7 TRANSACTIONS ANNEX VII: PREMIUM BENCHMARKS FOR MARKET BENCHMARK TRANSACTIONS ANNEX VIII: CRITERIA AND CONDITIONS GOVERNING THE APPLICATION OF A THIRD-PARTY REPAYMENT GUARANTEE AND THE CRITERIA FOR ASSESSING MULTILATERAL OR REGIONAL INSTITUTIONS ANNEX IX: BUYER RISK CATEGORIES QUALITATIVE DESCRIPTIONS ANNEX X: CRITERIA AND CONDITIONS GOVERNING THE APPLICATION OF COUNTRY RISK MITIGATION TECHNIQUES AND BUYER RISK CREDIT ENHANCEMENTS ANNEX XI: CHECKLIST OF DEVELOPMENTAL QUALITY ANNEX XII: COMMERCIAL INTEREST REFERENCE RATE (CIRR) PROVISIONS ANNEX XIII: LIST OF DEFINITIONS

1. PURPOSE a) The main purpose of the Arrangement on Officially Supported Export Credits, referred to throughout this document as the Arrangement, is to provide a framework for the orderly use of officially supported export credits. b) The Arrangement seeks to foster a level playing field for official support, as defined in Article 5 a), in order to encourage competition among exporters based on quality and price of goods and services exported rather than on the most favourable officially supported financial terms and conditions.

2. STATUS The Arrangement, developed within the OECD framework, initially came into effect in April 1978 and is of indefinite duration. The Arrangement is a Gentlemen’s Agreement among the Participants; it is not an OECD Act (), although it receives the administrative support of the OECD Secretariat (hereafter: ‘the Secretariat’).

3. PARTICIPATION

The Participants to the Arrangement currently are: Australia, Canada, the European Union, Japan, Korea, New Zealand, Norway, Switzerland, Türkiye, the United Kingdom and the United States. Other OECD Members and non-members may be invited to become Participants by the current Participants.

4. INFORMATION AVAILABLE TO NON-PARTICIPANTS a) The Participants undertake to share information with non-Participants on notifications related to official support as set out in Article 5 a). b) A Participant shall, on the basis of reciprocity, reply to a request from a non-Participant in a competitive situation on the financial terms and conditions offered for its official support, as it would reply to a request from a Participant.

5. SCOPE OF APPLICATION The Arrangement shall apply to all official support provided by or on behalf of a government for export of goods and/or services, including financial leases, which have a repayment term of two years or more.

1. Export credit guarantee or insurance (pure cover).

2. Official financing support:

— direct credit/financing and refinancing, or — interest rate support.

3. Any combination of the above. b) The Arrangement shall apply to tied aid; the procedures set out in Chapter IV shall also apply to trade-related untied aid. c) The Arrangement does not apply to exports of military equipment and agricultural commodities. d) Official support shall not be provided if there is clear evidence that the contract has been structured with a purchaser in a country which is not the final destination of the goods, primarily with the aim of obtaining more favourable repayment terms.

6. PROHIBITIONS ON ARRANGEMENT SUPPORT Participants shall not provide officially supported export credits or tied aid for:

a) The export of new coal-fired electricity generation plants or parts thereof, comprising all components, equipment, materials and services (including the training of personnel) directly required for the construction and commissioning of such power stations. The addition of a new coal-fired electricity generation unit to an existing plant is deemed to be a new coal-fired electricity generation plant. b) The export supply of equipment to existing coal-fired electricity generation plants, unless all the following conditions are met: i. The purpose of the equipment supplied is air pollution abatement, water pollution abatement, or CO2 emissions abatement.

ii. The equipment supplied induces neither an extension of the useful lifetime of the plant nor a capacity increase. c) The prohibitions set out in paragraphs a) and b) above do not apply to coal-fired electricity generation plants that operate with effective carbon capture utilisation and storage (CCUS) facilities or the retrofitting of existing coal-fired electricity generation plants to install CCUS, as provided for under Project Class B, Type 1 of Appendix I to Annex I.

d) Participants agree to undertake a review, upon request by a Participant, of non-CCUS CO2 emission abatement technologies which may be developed in the future, for purposes of exceptions from paragraphs a) and b) above. The inclusion of any future exception shall be based on a consensus decision by the Participants. e) The provisions set out in paragraphs a) through d) above shall be reviewed no later than 31 December 2022, in order to contribute to the common goal of addressing climate change, taking into account: i. The most recent reports on climate science and the implications for global infrastructure investment decisions of holding the increase in the global average temperature to well below 2 degrees Celsius above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels; ii. Officially supported export credits or tied aid support to other coal related projects; iii. Availability of CCUS technology; and iv. Availability of non-CCUS CO2 abatement technologies.

7. SECTOR UNDERSTANDINGS

a) The following Sector Understandings are part of the Arrangement:

— Climate Change (Annex I) — Nuclear Power Plants (Annex II) — Civil Aircraft (Annex III) — Ships (Annex IV) b) A Participant to either Annex I, II, or IV may apply the respective provisions for official support for export of goods and/or services covered by the relevant Sector Understandings. For Annex I or II, where the Sector Understanding does not include a corresponding provision to that of the Arrangement, a Participant to that Sector Understanding shall apply the provision of the Arrangement. c) For the export of goods and/or services covered by Annex III, the Participants that are also Participants to that Sector Understanding shall apply the provisions of that Sector Understanding.

8. WITHDRAWAL A Participant may withdraw by notifying the Secretariat in writing by means of instant communication, e.g. using the electronic mail system that is maintained by the Secretariat to facilitate communications amongst Participants and the Secretariat. The withdrawal takes effect 180 calendar days after receipt of the notification by the Secretariat.

9. MONITORING

The Secretariat shall monitor the implementation of the Arrangement. CHAPTER II FINANCIAL TERMS AND CONDITIONS FOR EXPORT CREDITS Financial terms and conditions for export credits encompass all the provisions set out in this Chapter which shall be read in conjunction one with the other. The Arrangement sets out limitations on terms and conditions that may be officially supported. The Participants recognise that more restrictive financial terms and conditions than those provided for by the Arrangement traditionally apply to certain trade or industrial sectors. The Participants shall continue to respect such customary financial terms and conditions, in particular the principle by which repayment terms do not exceed the useful life of the goods and services.

10. CLASSIFICATION OF COUNTRIES FOR LOCAL COSTS SUPPORT a) Category I countries are High Income () OECD Countries. All other countries are in Category II. b) The following operational criteria and procedures apply when classifying countries: 1. Classification for Arrangement purposes is determined by per capita GNI as calculated by the World Bank for the purposes of the World Bank classification of borrowing countries

2. In cases where the World Bank does not have enough information to publish per capita GNI data, the World Bank shall be asked to estimate whether the country in question has per capita GNI above or below the current threshold. The country shall be classified according to the estimate unless the Participants decide to act otherwise 3. If a country is reclassified in accordance with Article 10 a), the reclassification will take effect two weeks after the conclusions drawn from the above-mentioned data from the World Bank have been communicated to all Participants by the Secretariat 4. In cases where the World Bank revises figures, such revisions shall be disregarded in relation to the Arrangement. Nevertheless, the classification of a country may be changed by way of a Common Line and Participants would favourably consider a change due to errors and omissions in the figures subsequently recognised in the same calendar year in which the figures were first distributed by the Secretariat. c) A country will change category only after its World Bank category has remained unchanged for two consecutive years.

11. DOWN PAYMENT, MAXIMUM OFFICIAL SUPPORT AND LOCAL COSTS

a) The Participants shall require purchasers of goods and services, which are the subject of official support, to make down payments of a minimum of 15 % of the export contract value at or before the starting point of credit as defined in Annex XIII. For the assessment of down payments, the export contract value may be reduced proportionally if the transaction includes goods and services from a third country which are not officially supported. Financing/insurance of 100 % of the premium is permissible. Premium may or may not be included in the export contract value. Retention payments made after the starting point of credit are not regarded as down payment in this context. b) Official support for such down payments shall only take the form of insurance or guarantee against the usual pre-credit risks. c) Except as provided for in paragraphs b) and d), the Participants shall not provide official support in excess of 85 % of the export contract value, including third country supply but excluding local costs.