We insure in national interest

Friday, 4. September 2009

Effective from 4 September 2009, a substantial change has been made in insurance of the Czech export with state support. Instead of principle of support of the export of goods of "national origin" EGAP changed to the principle of export support "in national interest". The amendment of the Act No. 58/1995 Coll., on insuring and financing of export with state support enabled this change; EGAP may now insure not only exporters and investors with seat in the Czech Republic but under same conditions also their foreign subsidiaries.

The foreign subsidiary is understood as a legal person with the seat abroad which is controlled by the parent company with the seat in the Czech Republic in a way that it:

  • owns directly or indirectly more than 50 % of the share capital, or
  • controls a majority of voting rights connected with participation in the share capital, or
  • may appoint a majority of members of the Board of Directors, Supervisory Board or of other similar managing body of the company.

The foreign subsidiary must comply with at least one of the following conditions in order to be able to ask for insurance with state support:

  1. the share of goods and services of Czech origin in the value of the delivery has to be significant,
  2. the delivery supports employment in the Czech Republic,
  3. it is the export to priority target countries in accordance with criteria of the Ministry of Industry and Trade and Ministry of Foreign Affairs,
  4. it supports small- and medium sized enterprises,
  5. it is the export of advanced technologies,
  6. it supports research and development in the Czech Republic,
  7. the delivery leads to lowering of costs and to maintaining of international competitiveness,
  8. it is the support of a new product or of its penetration to the new market,
  9. dividends from foreign company will be used in the Czech Republic,
  10. there will be other significant contributions for the Czech Republic in the longer perspective.

Having complied with this, the delivery of goods and services of the foreign subsidiary is considered as the Czech export and rules for determination of the share of goods and services of Czech origin in the total value of the export may be applied to it.

 

 

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