EXIM Bank has established due diligence standards for its guaranteed and insured lender partners and participants, and requires EXIM Bank's guaranteed and insured lenders to implement "know your customer" practices.
EXIM's Additionality policy is to ensure that EXIM does not crowd out the private sector and only supports transactions where EXIM financing is necessary for a U.S. export to take place. EXIM utilizes the additionality guidance and checklist in judging the additionality of a transaction.
To facilitate financing with other export credit agencies (ECAs), EXIM Bank is actively establishing "One-Stop-Shop" co-financing facilities. "One-Stop-Shop" arrangements allow products and services from two (or more) countries to benefit from a single ECA financing package. Without co-financing, the parties would have to make separate financing arrangements with two (or more) ECAs to ensure support for exports from various countries. The country with the largest share of the sourcing and/or the location of the main contractor will generally determine which ECA leads the transaction.
EXIM Bank's mission is to support U.S. jobs through exports. Accordingly, there are foreign content eligibility criteria and limitations on the level of foreign content that may be included in EXIM Bank's financing package.
The basis for EXIM Bank's Economic Impact Procedures is found in its Charter. Congress requires EXIM Bank to assess whether the extension of EXIM Bank financing support is likely to cause substantial injury to U.S. industry or would result in the production of substantially the same product that is the subject of specified trade measures. If a transaction is deemed by EXIM Bank to meet the legislatively specified standards, then economic impact can be the basis for denial of EXIM Bank support. The purposes of EXIM Bank's Economic Impact Procedures are: 1) to ensure that all transactions are screened for economic impact implications; 2) to identify those transactions that are subject to applicable trade measures or that pose a risk of substantial injury to the U.S. economy; and 3) to put only those cases that require further economic impact analysis through a more extensive process that is fair, consistent, and publicly transparent.
EXIM Bank's Charter authorizes the Board of Directors to grant or withhold financing support after taking into account the beneficial and adverse environmental effects of proposed transactions. EXIM Bank's objective is to maintain U.S. exporters' competitiveness in the global marketplace while ensuring that the projects it supports are environmentally responsible. Environmental and Social Due Diligence Procedures and Guidelines have been adopted which set forth EXIM Bank's environmental objectives. These Procedures and Guidelines identify the procedures that the Engineering and Environment Division will use and the standards against which the Division will evaluate the environmental effects of projects.
U.S. firms and individuals seeking to do business in foreign markets must be familiar with the Foreign Corrupt Practices Act of 1977 ("FCPA"), 15 U.S.C. §§ 78dd-1, et seq., which, in general, prohibits corrupt payments to foreign officials for the purpose of obtaining or keeping business. The antibribery provisions of the FCPA make it unlawful for a U.S. person, and certain foreign issuers of securities, to make a corrupt payment to a foreign official for the purpose of obtaining or retaining business for or with, or directing business to, any person. They also apply to foreign firms and persons who take any act in furtherance of such a corrupt payment while in the United States.
When EXIM Bank provides medium- or long-term guarantee, loan, or insurance support for U.S. exports for foreign projects, it may also provide local cost support. Local costs are those project-related costs for goods and services incurred in the buyer's country. EXIM Bank can support up to 50% of the value of the U.S exports for locally originated and/or manufactured goods and services subject to the following availability and eligibility guidelines.
EXIM Bank is prohibited by law from financing defense articles and defense services. In defining what is a "defense article" or "defense service", EXIM Bank uses criteria based on the identity of the foreign end-user, the nature of the item, and the use to which the item will be put. If the items are sold to a military organization or designed primarily for military use, they are presumed to be defense articles unless proven otherwise.
EXIM Bank can support exports to foreign non-military security forces given extra administrative review. Such security forces include private security services (such as security guards), as well as non-military government security forces such as local police, transportation police, or federal police.
Non-discrimination on Basis of Industry, Sector or Business
In accordance with Section 2(k) of the Bank's Charter, except as otherwise provided in the Charter, the Bank may not (a) deny an application for financing based solely on the industry, sector or business the application concerns, or (b) promulgate or implement policies that discriminate against an application based solely on the industry, sector or business that it concerns.
The Guidelines Applicable to Projects in the Nuclear Sector are an important supplement to the broader Environmental and Social Due Diligence Procedures and Guidelines and are set forth in Annex A-3 of the Guidelines. These special Guidelines are intended to address the particular environmental considerations associated with the safe construction and operation of projects in the nuclear sector, and they incorporate the major health and safety standards, guidelines and recommended procedures established by the International Atomic Energy Agency for commercial nuclear projects. In addition, EXIM Bank's financial support for the export of nuclear equipment, components and/or materials can only proceed pursuant to the issuance of applicable export licenses by the U.S. Nuclear Regulatory Commission, or an authorization by the U.S. Department of Energy for the transfer of nuclear technology, in accordance with the Atomic Energy Act, as amended.
EXIM Bank's shipping requirements are based on Public Resolution 17 of the 73rd Congress (PR-17) concerning U.S. flag shipping of certain U.S. government agency supported export cargos. Shipping on U.S. flag vessels is required for direct loans (regardless of term or amount), and guarantees in excess of $20,000,000 (excluding EXIM Bank Exposure Fee) or with a repayment period greater than 7 years.
Equipment that has been previously owned or placed into service is generally eligible for support under EXIM Bank's loan, guarantee and insurance programs, provided certain criteria are met.