EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Trade and Tourism
Export Finance and Insurance Corporation Act 1991
Export Finance and Insurance Corporation Regulations 2025
Purpose
The purpose of the Export Finance and Insurance Corporation Regulations 2025
(Regulations) is to provide increased upper limits for the prescribed maximum contingent liability of guarantees and insurance contracts and on the total amount of loans made under Part 4 of the Export Finance and Insurance Corporation Act 1991 (EFIC Act).
The Regulations repeal and replace the Export Finance and Insurance Corporation Regulations 2018 (2018 Regulations).
Legislative Authority
These Regulations are made under subsection 91(1) of the EFIC Act.
Subsection 91(1) of the EFIC Act provides that the Governor-General may make regulations, not inconsistent with the EFIC Act, prescribing matters required or permitted by the EFIC Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the EFIC Act.
Background
The EFIC Act established Export Finance Australia (EFA) as a Corporate Commonwealth Entity. EFA's core purpose is to support Australian export trade and overseas investment, as well as overseas infrastructure development that has an Australian benefit.
The 2018 Regulations set upper limits on EFA’s aggregate liabilities under guarantees, insurance contracts, and loans that it may enter into on the Commercial Account, and EFA operates within these limits.
Consultation
The Department of Foreign Affairs and Trade (DFAT) consulted internally, and with EFA and the Department of Finance to determine the limits appropriate to prescribe in these Regulations.
Other Matters
Details of the Regulations are set out at Attachment A.
The Regulations are a legislative instrument for the purposes of the Legislation Act 2003.
The Regulations are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. The Statement of Compatibility with Human Rights is at Attachment B.
ATTACHMENT A
Details of the Export Finance and Insurance Corporation Regulations 2025
Part 1 – Preliminary
Section 1 – Name
1. Section 1 provides that the title of the Regulations is the Export Finance and Insurance Corporation Regulations 2025 (Regulations).
Section 2 – Commencement
2. This section provides for the commencement of the Regulations, as set out in the table in subsection 2(1).
3. Column 2 of the Table in subsection 2(1) provides that the whole of the Regulations commence on the day after registration.
4. Subsection 2(2) provides that any information in column 3 of the table is not part of the Regulations. Information may be inserted in this column, or information in it may be edited, in any published version of the Regulations.
Section 3 – Authority
5. Section 3 provides that the Regulations are made under the Export Finance and Insurance Corporation Act 1991 (EFIC Act).
Section 4 – Schedules
6. Section 4 provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.
Section 5 – Definitions
7. Section 5 defines the term “Act” to mean the Export Finance and Insurance Corporation Act 1991 for the purposes of the Regulations.
Part 2 – Limitations
Section 6 – Maximum contingent liability under Part 4 of the Act
8. Subsection 6(2) of the 2018 Regulations provided for maximum contingent liabilities of $1 billion for contracts of insurance entered into under section 22 of the EFIC Act.
9. Subsection 6(1) of the Regulations provides that for the purposes of paragraph 68(1)(a) of the EFIC Act, the revised maximum contingent liability amount prescribed for contracts entered into and guarantees given under Part 4 of the EFIC Act (other than contracts of insurance under section 22 of the EFIC Act) is $5 billion, to more accurately reflect EFA’s current business and expected future market needs.
10. Subsection 6(2) of the Regulations provides that for the purposes of paragraph 68(1)(b) of the EFIC Act, the revised maximum contingent liability amount prescribed for contracts of insurance entered into under section 22 of the EFIC Act is $2 billion, to more accurately reflect EFA’s current business and expected future market needs.
11. The notes following subsections 6(1) and 6(2) clarify that section 8 of the Regulations provides for the conversion of amounts in foreign currency.
Section 7 - Limit of total amount of loans under Part 4 of the Act
12. Section 7 of the 2018 Regulations provided that for the purposes of subsection 69(1) of the EFIC Act, the maximum amount prescribed for loans under Part 4 of the EFIC Act and not repaid or written off was $3 billion.
13. Section 7 of the Regulations provides that for the purposes of subsection 69(1) of the EFIC Act, the revised maximum amount prescribed for loans under Part 4 of the EFIC Act and not repaid or written off is $6 billion, to more accurately reflect EFA’s current business and expected future market needs.
14. The note following section 7 clarifies that section 8 of the Regulations provides for the conversion of amounts in foreign currency.
Section 8 – Conversion of amounts in foreign currency
15. Section 8 of the Regulations provides for the conversion of amounts in foreign currency into Australian currency.
Schedule 1 – Repeals
Export Finance and Insurance Corporation Regulations 2018
Clause 1
16. Clause 1 repeals the whole of the 2018 Regulations.
ATTACHMENT B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Export Finance and Insurance Corporation Regulations 2025
This Disallowable Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Disallowable Legislative Instrument
The Export Finance and Insurance Corporation (Export Finance Australia, or EFA) is the Australian Government’s official export credit agency. This Disallowable Legislative Instrument sets upper limits on the total amount of loans, insurance and guarantees provided by EFA. This Disallowable Legislative Instrument increases the limits for loans, guarantees and insurance products to more accurately reflect EFA’s current business and expected future market needs.
Human rights implications
This Disallowable Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This disallowable Legislative Instrument is compatible with human rights as it does not raise any human rights issues.