If Insurance of Credit for the Financing of Investment in Foreign Countries Short description of insurance product and contacts

I. Short description of insurance product

The credit for financing investment abroad is the credit provided by the bank for acquisition of long-term tangible, intangible or financial property for a foreign company controlled by the Czech investor or for acquisition of a foreign company by the Czech investor or for financing a foreign company's operation. Only the credit with the term longer than 3 years from the first drawing to final due date may be insured. The condition of insurance is also the partial financing the investment from the own financial sources of investor. Its amount will be set by the agreement between EGAP, bank and investor (usually at least 25 %).

The bank is insured hereby against the risk of failure to pay back the credit provided to a Czech investor or its foreign subsidiary.

The subject of insurance are the claims of the insured (investor's bank) towards the debtor for the payment of credit principal for investments, interests and other fees as per credit contract.

The insured event is a partial or complete non-payment of the insured credit due to commercial or territorial reasons or their combination. Territorial reasons are: impossibility of conversion and/or transfer of revenues, expropriation, violent politic acts and violating contractual obligations by the host state. Commercial reasons are: debtors´ incapacity to pay its due obligations (financial insolvency) or rejection to pay an insured claim by the debtor without legal reason (unwillingness to pay).

The premium amount depends on the volume and term of credit for investments, scope of insured territorial and commercial risks associated with the foreign investment, evaluation of character and risk rating of investor and deductible amount.

The preliminary premium calculation is available through interactive calculator.

Petr Martásek, Director of Pre-export, Investment and Bond Insurance Department
phone:+420 222 842 340
fax:+420 222 844 130
e-mail:martasek@egap.cz

Michal Pravda, Head of Sub-Department for Insurance of Investments Abroad
phone:+420 222 842 348
fax:+420 222 844 130
e-mail:pravda@egap.cz

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