Officially supported export credits can be used to finance the export of capital goods, consulting and planning services, which have a repayment term of two years or more. The OECD Arrangement on Guidelines for Officially Supported Export Credits (OECD Arrangement) defines i.a. the maximum credit amount and repayment period, the minimum rate of interest and the starting point of the repayment. The OECD-term interest is based on CIRR (Commercial Interest Reference Rate) determined once a month.
There are financing systems for officially supported export credits in virtually all industrialized countries that export capital goods. In Finland the official support consists of:
1. Interest equalisation by FEC
2. Funding by FEC
3.
Export Credit Guarantees provided by Finnvera plc
In several countries loans from FEC enjoy a more favorable tax treatment than loans from commercial banks. FEC can act as a lender when providing export credits to foreign buyers of Finnish goods and services in such countries, thereby offering an additional cost benefit for the transaction.
FEC pays attention to the environmental impacts of projects financed and will apply the OECD recommendation on common approaches on environment and officially supported export credits adopted by OECD member countries on 18 December 2003. As a subsidiary of Finnvera plc, FEC adheres to the same environmental policy as its parent. Further, an Action Statement on Bribery (the Anti-Bribery Declaration of the Exporter) and Officially Supported Export Credits adopted by OECD Working Party on Export Credits and Credit Guarantees is adhered to in FEC’s operations.