Export Finance and Insurance Corporation Regulations (Amendment)

Overview

The Export Finance and Insurance Corporation Regulations (Amendment) 1994 No. 380, issued under the authority of the Minister for Industry, Science and Technology, amends the existing regulations to address an increasing demand for the Corporation's lending facilities. The Export Finance and Insurance Corporation Act 1991 established the Corporation to provide loans to foreign buyers of Australian capital goods and related services, which are often not available from commercial sources. As the demand for these facilities grows with the increase in Australian exports and aid-supported lending, the current regulatory limit of $2,500 million is nearing its maximum capacity. The policy objective of this amendment is to increase the total amount of loans that can be provided by the Corporation to $3,300 million, thereby supporting the growth in Australian exports and maintaining the Corporation's role in facilitating international trade. This amendment ensures that the Corporation can continue to meet the evolving needs of the Australian export sector effectively.

Scope and Application

The Export Finance and Insurance Corporation Regulations (Amendment) 1994 No. 380 applies to the operations of the Export Finance and Insurance Corporation (EPIC) as established under the Export Finance and Insurance Corporation Act 1991. The EPIC is a government-owned corporation that provides loans and insurance to facilitate Australian exports of capital goods and services to foreign buyers, especially in cases where commercial loans are not readily available. The Regulations specifically amend the existing rules to increase the total amount of loans that the EPIC can provide from $2,500 million to $3,300 million, reflecting an anticipated rise in the demand for its services. The increased lending capacity is intended to support the growth of Australian exports and aid-supported projects abroad. The Regulations apply nationally across Australia and are subject to the overarching provisions of the Export Finance and Insurance Corporation Act 1991. There are no exclusions or exemptions explicitly stated in the Explanatory Statement, and the amendment is confined to the scope of the lending facilities without extending to other areas of EPIC's operations.

Key Provisions

The Export Finance and Insurance Corporation Regulations (Amendment) 1994 No. 380, issued under the authority of the Minister for Industry, Science and Technology, amends the existing Export Finance and Insurance Corporation Regulations to increase the total amount of loans that can be provided by the Corporation. Section 91 of the Export Finance and Insurance Corporation Act 1991 empowers the Governor-General to make regulations that are necessary or convenient for the operation of the Act. This amendment is specifically focused on modifying Regulation 4, which sets the cap on the total amount of loans that the Corporation can provide. Currently, the limit is $2,500 million, and the amendment proposes to raise this cap to $3,300 million, reflecting the anticipated growth in demand for the Corporation's lending facilities in line with the expansion of Australian exports and aid-supported lending. The Corporation, as a key financial entity, offers loans to foreign buyers of Australian capital goods and related services, which are often not available from commercial sources. This regulatory amendment ensures that the Corporation can continue to support Australian exporters by providing necessary financial assistance. By increasing the loan limit, the amendment aims to accommodate the growing needs of the market and to support the broader economic goal of expanding Australian exports. In terms of obligations and requirements, the amendment imposes a new limit on the Corporation's lending capacity, now set at $3,300 million. The Corporation must ensure that its lending activities remain within this new limit, and it must maintain appropriate records and reporting to demonstrate compliance with the amended Regulation. The amendment also requires the Corporation to review its lending practices and strategies to ensure they align with the increased lending capacity and to manage risk effectively within the new framework. The legislation includes provisions for enforcement and compliance. Breaches of the amended regulations may result in legal consequences for the Corporation and its officers. While the specific offences and penalties are not detailed in the explanatory statement, it is implied that any failure to comply with the new lending limit could lead to civil or criminal penalties, potentially including fines or other sanctions. These consequences underscore the importance of adhering to the regulatory requirements and maintaining the integrity of the Corporation's lending activities.