Export Credit Agencies and export credit support
Produced in partnership with Dimitri Papaefstratiou, Joseph Lam and Wen Liu of DLA Piper (UK) LLP
Export Credit Agencies and export credit support

The following Banking & Finance guidance note Produced in partnership with Dimitri Papaefstratiou, Joseph Lam and Wen Liu of DLA Piper (UK) LLP provides comprehensive and up to date legal information covering:

  • Export Credit Agencies and export credit support
  • What purpose do ECAs serve?
  • How do ECAs serve their purpose?
  • What kinds of support do ECAs offer?
  • What are their advantages?
  • Governmental/quasi-governmental nature of ECAs
  • OECD Consensus or the Arrangement
  • ECA intercreditor arrangements
  • ECAs at home and abroad

BREXIT: The UK is leaving the EU on Exit Day (as defined in the European Union (Withdrawal) Act 2018). This will have an impact on the information in this Practice Note about the Organisation for Economic Co-operation and Development (the OECD) generally and the OECD Arrangement on Officially Supported Export Credits. For details, see Practice Note: Brexit—impact on finance transactions—Key issues for trade finance.

Exporters who wish to take their goods or services to overseas markets will often face significant risks in their endeavours to generate new business. The likelihood of non-payment in these environments is heightened in the face of enhanced:

  1. commercial risk (ie failure to pay by an overseas buyer, overseas buyer's insolvency, unilateral breach of contract, non-performance of the asset or non-payment by off-takers), and

  2. political risk (ie the risk that government action or political circumstances will have an adverse effect on local business and/or international investment)

For certain goods or services or in certain markets, these risks may substantially inhibit the availability of commercial financiers, meaning that in the absence of Export Credit Agency (ECA) assistance, many such projects may never get off the ground.

ECAs exist to step into this gap and help mitigate the commercial and/or political risks inherent in dealing with an overseas business, providing an important source of financial support to project developers, exporters or