Communication from the Commission amending the Annex to the Communication from the Commission to the Member States on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance
Date: 2015-07-01
Institutions: European Commission
Subjects: Greece, State aid, application of EU law, competition, export, export aid, export credit, export credit insurance, short-term credit








C_2015215EN.01000101.xml










1.7.2015   


EN


Official Journal of the European Union


C 215/1





Communication from the Commission amending the Annex to the Communication from the Commission to the Member States on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance
(2015/C 215/01)
I.   INTRODUCTION









(1)


The Communication from the Commission to the Member States on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance (1) (the ‘Communication’) stipulates in paragraph 13 that State insurers (2) cannot provide short-term export-credit insurance for marketable risks. Marketable risks are defined in paragraph 9 as commercial and political risks with a maximum risk period of less than two years, on public and non-public buyers in the countries listed in the Annex to that Communication.












(2)


As a consequence of the difficult situation in Greece, a lack of insurance or reinsurance capacity to cover exports to Greece was observed in the years from 2012 until 2014. This led the Commission to amend the Communication by temporarily removing Greece from the list of marketable risks countries in 2013 (3), in 2014 (4) and during the first six months of 2015 (5). The most recent extension of this amendment expires on 30 June 2015. As a consequence, as from 1 July 2015, Greece would in principle be considered again as marketable, since all EU Member States are included in the list of marketable countries listed in the Annex to the Communication.












(3)


However, in accordance with paragraph 36 of the Communication, the Commission started to review the situation several months before the end of Greece’s temporary removal in order to determine whether the current market conditions justify the expiry of Greece’s removal from the list of marketable risk countries as of 1 July 2015, or whether the market capacity is still insufficient to cover all economically justifiable risks, so that a prolongation is needed.




II.   ASSESSMENT









(4)


When determining whether the lack of sufficient private capacity to cover all economically justifiable risks justifies the prolongation of the temporary removal of Greece from the list of marketable risk countries, the Commission consulted and sought information from Member States, private credit insurers and other interested parties. On 27 April 2015, the Commission published an information request on the availability of short-term export-credit insurance for exports to Greece (6). The deadline for replies expired on 24 May 2015. Fifteen replies were received from Member States and private insurers.












(5)


The information submitted to the Commission in the context of the public information request indicates that private export-credit insurers have become more restrictive to provide insurance coverage for exports to Greece in all trade sectors. At the same time, State insurers continued to register increasing demand for credit insurance for exports to Greece, which corroborates the limited availability of private insurance.












(6)


In addition, the economic outlook for Greece has deteriorated (7) According to the Commission’s European Economic Forecast – May 2015 Greece’s economy is now expected to grow by 0,5 % in real terms in 2015 (against a previous forecast in February for a 2,5 % growth) reflecting tighter financing conditions and uncertainty over the country’s policy commitments in the context of the EU/IMF support arrangement following political changes in the beginning of 2015.












(7)


Those economic tensions have also influenced negatively the sentiment in the financial markets. The yield of the 10-year Greek government bonds sharply increased during the first five months of the year, with peaks above 10 %, while a downward trend was evident in the stock exchange index (ATHEX). Those fluctuations reflect that investors consider Greece as highly risky and are therefore not keen to have exposure towards Greece.












(8)


In these circumstances the Commission expects that private export-credit insurers will continue to be very cautious in providing insurance coverage for exports to Greece or even completely withdraw from the Greek market. Private insurers will likely resume increasing their exposure, only if there is more visibility and clarity regarding the political and economic policies in Greece and if a significant improvement of the economic situation is noticed.












(9)


For those reasons, the Commission established a lack of sufficient private capacity to cover all economically justifiable risks and decided to prolong the removal of Greece from the list of marketable risks until 30 June 2016. The conditions of coverage set out in section 4.3 of the Communication are applicable in this case.




III.   AMENDMENT TO THE COMMUNICATION









(10)


The following amendment to the Communication from the Commission to the Member States on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance will apply from 1 July 2015 until 30 June 2016:






—


The Annex is replaced by the following:

‘LIST OF MARKETABLE RISK COUNTRIES






—


All Member States with the exception of Greece










—


Australia










—


Canada










—


Iceland










—


Japan










—


New Zealand










—


Norway










—


Switzerland










—


United States of America’















(1)  OJ C 392, 19.12.2012, p. 1.

(2)  A State insurer is defined by the Communication as a company or other organisation that provides export-credit insurance with the support of, or on behalf of, a Member State, or a Member State that provides export-credit insurance.

(3)  OJ C 398, 22.12.2012, p. 6.

(4)  OJ C 372, 19.12.2013, p. 1.

(5)  OJ C 28, 28.1.2015, p. 1.

(6)  http://www.acceptance.ec.europa.eu/competition/consultations/2015_export_greece/index_en.html

(7)  For example: S&P and Fitch: CCC end of May, from B in December 2014.