Export Finance and Insurance Corporation Act (EFIC Act)
Export Finance Australia is the Government’s export credit agency, performing within various statutory frameworks since 1957. We were established under the Export Finance and Insurance Corporation Act 1991 (EFIC Act) as a statutory corporation wholly owned by the Government.
Under the EFIC Act, Export Finance Australia’s key functions are to:
- facilitate and encourage Australian export trade and overseas infrastructure development by providing finance
- encourage banks and other financial institutions to finance exports and overseas infrastructure development
- provide information and advice about finance to help support Australian export trade
- assist other Commonwealth entities and businesses in providing finance and financial services
- administer payments in relation to overseas aid.
At Export Finance Australia, we’re self-funding. We operate on a commercial basis, charging customers fees and premiums and earning interest on loans and investments. This includes the investment of our cash capital, reserves and working capital. The Government also guarantees that our creditors receive all monies payable by Export Finance Australia. This guarantee has never been called. Regulations under the EFIC Act set upper limits on our aggregate liabilities under facilities, guarantees and insurance contracts that we may enter into on the Commercial Account. Export Finance Australia operates within these limits.
Our legislation provides two distinct platforms from which we support Australian exports:
- the Commercial Account (under Part 4 of the EFIC Act)
- the National Interest Account (under Part 5 of the EFIC Act).
Under the Commercial Account, we carry all risks as a corporate Commonwealth entity. We retain all margins and fees and bear all risks and losses.
National Interest Account
Under the National Interest Account, our Minister can direct us to support transactions that are in the national interest.
Export Finance Australia can also refer transactions to the Minister for consideration. This might be due to the transaction’s size or the tenor of the transaction or significant exposures to the country of export.
The Commonwealth receives all income on National Interest Account transactions. It also bears all risks and losses.