Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union in the Meeting of the Participants to the Arrangement on Officially Supported Export Credits
Date: 2018-07-19
Institutions: Directorate-General for Trade and Economic Security, European Commission
Subjects: State aid, bus, cable transport, carriage of passengers, export aid, export credit, framework agreement, international meeting, revision of an agreement

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 19.7.2018 COM(2018) 542 final 2018/0289 (NLE)  Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union in the Meeting of the Participants to the Arrangement on Officially Supported Export Credits  
 
 
EXPLANATORY MEMORANDUM 

1. 

SUBJECT MATTER OF THE PROPOSAL 

This proposal concerns the decision establishing the position to be taken on the Union's behalf 
in the Meeting of the Participants to the Arrangement on Officially Supported Export Credits 
(the  Meeting  of  the  Participants)  in  connection  with  the  envisaged  adoption  of  a  decision 
concerning  the  expansion  of  the  scope  of  Annex  V  of  the  Arrangement  on  Officially 
Supported  Export  Credits  (Sector  Understanding  on  Export  Credits  for  Rail  Infrastructure 
(RSU)) to include cable cars and trolleybuses. 

2. 

CONTEXT OF THE PROPOSAL 

2.1. 

The Arrangement on Officially Supported Export Credits 

The  Arrangement  is  a  Gentlemen's  Agreement  between  the  EU,  the  US,  Canada,  Japan, 
Korea, Norway, Switzerland, Australia and New Zealand which aims to provide a framework 
for the orderly use of officially supported export credits. In practice, this means providing for 
a level playing field (whereby competition is based on the price and quality of the exported 
goods and not on the financial terms provided) and working to eliminate subsidies and trade 
distortions related to officially supported export credits. The Arrangement entered into force 
in April 1978, it is of indefinite duration and although it receives the administrative support of 
the OECD Secretariat, is not an OECD Act1.  

The Arrangement is subject to regular updates, to take into account new technical and policy 
developments  affecting  export  credits  in  various  sectors.  The  guidelines  contained 
Arrangement  have  been  incorporated  in  Union  legislation  ,  and  hence  been  made  legally 
binding in the EU by Regulation (EU) No 1233/2011 of the European Parliament and of the 
Council23.  Updates  are  regularly  incorporated  into  EU  legislation  through  delegated  Acts 
pursuant to Article 2 of this Regulation.  

2.2. 

The  Meeting  of  the  Participants  to  the  Arrangement  on  Officially  Supported 
Export Credits 

The European Commission represents the Union in the Participants meeting, where decisions 
on all modifications to the Arrangement are taken by consensus among the 9 Participants. The 
positions of the Union are prepared in consultation with the Member States represented in the 
Council Working Group on Export Credits4. 

Article  67  of  the  Arrangement  provides  that  "The  Participants  shall  review  regularly  the 
functioning  of  the  Arrangement.  In  the  review  the  Participants  shall  examine,  inter  alia, 
notification  procedures,  implementation  and  operation  of  the  DDR  system,  rules  and 
procedures on tied aid, questions of matching, prior commitments and possibilities of wider 
participation in the Arrangement". 

1 
2 

3 

4 

As defined in Article 5 of the OECD Convention.  
Regulation (EU) No 1233/2011 of the European Parliament and of the Council of 16 November 2011 
on the application of certain guidelines in the field of officially supported export credits and repealing 
Council Decisions 2001/76/EC and 2001/77/EC (OJ L 326,8.12.2011, p. 45). 
In  the  past,  earlier  versions  of  the  OECD  Arrangement  had  already  been  transposed  into  EU  law  by 
Council Decisions.  
Council Decision setting up a Policy Co-ordination Group for Credit Insurance, Credit Guarantees and 
Financial Credits, (OJ 66, 27.10.1960, p. 1339/60). 

EN 

1 

  EN 

 
                                                 
2.3. 

The  envisaged  act  of  the  Meeting  of  the  Participants  to  the  Arrangement  on 
Officially Supported Export Credits 

During the 136th and 137th Meetings of the Participants on the 16th of November 2017, the 
Participants discussed the Union’s proposal to expand the scope of the RSU to include cable 
cars  and  trolleybuses.  At  the  137th  Meeting  of  the  Participants  the  Union  was  asked  to 
provide additional information  on the financial rationale to expand the scope of the RSU to 
cover  these  infrastructures,  this  information  was  provided  by  the  EU  delegates  during  the 
138th  Meeting  of  the  Participants,  which  took  place  on  the  14th  and  15th  of  March  2018. 
During that meeting no Participant opposed the proposed expansion of the scope. 
On  the  week  of  the  14  November  2018,  during  its  140th  session,  the  Meeting  of  the 
Participants is to adopt a decision drafted by the Secretariat on the basis of the proposal put 
forward by the Union (‘the envisaged act’). 

3. 

POSITION TO BE TAKEN ON THE UNION'S BEHALF 

The  current  scope  of  the  RSU  is  limited  to  rail  infrastructure  projects.  However,  there  are 
other  transportation  systems  which  are  not  based  on  rail  infrastructure  but  which  form  an 
integrated  part  of  public  transportation  systems,  especially  in  urban  areas.  Cable  cars  and 
trolleybuses  are  such  an  example  of  non-rail-based  public  transportation  systems  which  are 
becoming  increasingly  interesting  in  urban  transport  infrastructure  of  large  cities,  in 
particular, in emerging countries. Currently, however, these projects cannot benefit from the 
terms and conditions of the RSU which are more adapted to the nature of these projects. EU 
manufacturers  of  this  type  of  infrastructure  would  benefit  from  the  expansion  of  the  scope, 
being able to provide better terms and conditions to their clients.  

Cable  car  and  trolleybuses  projects  usually  have  building  costs  above  the  minimum  RSU 
overall  contract  value  of  SDR  10  millions,  and  the  useful  life  of  their  infrastructure  is 
normally longer than 20 years. Therefore they are similar to other rail infrastructure projects 
currently under the scope of the RSU and therefore benefiting from longer repayment terms.  

Cable car and trolleybuses projects are primarily commissioned by public entities with often 
limited access to financial commercial markets. Expanding the scope of the RSU to include 
cable car and trolleybuses would allow the use of officially supported export credits for these 
projects  under  the  specific  RSU  terms  and  conditions,  providing  longer  repayment  terms 
which would facilitate the implementation of these projects. 

Therefore, it is recommended that the EU supports the expansion of the scope of the RSU in 
order to include cable cars and trolleybuses.  

4. 

LEGAL BASIS 

4.1. 

Procedural legal basis 

4.1.1.  Principles 

Article 218(9) of the Treaty on the Functioning of the European Union (TFEU) provides for 
decisions establishing ‘the positions to be adopted on the Union’s behalf in a body set up by 
an  agreement,  when  that  body  is  called  upon  to  adopt  acts  having  legal  effects,  with  the 
exception of acts supplementing or amending the institutional framework of the agreement.’ 

The concept of ‘acts having legal effects’ includes acts that have legal effects by virtue of the 
rules of international law governing the body in question. It also includes instruments that do 

EN 

2 

  EN 

 
not  have  a  binding  effect  under  international  law,  but  that  are  ‘capable  of  decisively 
influencing the content of the legislation adopted by the EU legislature’5. 

4.1.2.  Application to the present case 

The act which the Meeting of the Participants is called upon to adopt constitutes an act having 
legal effects. The envisaged act has legal effects because, by virtue of Article 2 of Regulation 
(EU)  No  1233/2011,,  the  Commission  is  required  to  adopt  delegated  acts  in  the  Union’s 
legislation  the  result  of  amendments  to  the  guidelines  agreed  by  the  Participants  to  the 
Arrangement. 

Therefore, the procedural legal basis for the proposed decision is Article 218(9) TFEU. 

4.2. 

Substantive legal basis 

4.2.1.  Principles 

The  substantive  legal  basis  for  a  decision  under  Article  218(9)  TFEU  depends  primarily  on 
the objective and content of the envisaged act in respect of which a position is taken on the 
Union's  behalf.  If  the envisaged act  pursues  two  aims  or  has  two  components  and  if  one  of 
those  aims  or  components  is  identifiable  as  the  main  one,  whereas  the  other  is  merely 
incidental, the decision under Article 218(9) TFEU must be founded on a single substantive 
legal basis, namely that required by the main or predominant aim or component. 

4.2.2.  Application to the present case 

The  main  objective  and  content  of  the  envisaged  act  relate  to  the  regulation  of  officially 
supported  export  credits,  which  fall  within  the  scope  of  the  common  commercial  policy. 
Therefore, the substantive legal basis of the proposed decision is Article 207. 

4.3. 

Conclusion 

The  legal  basis  of  the  proposed  decision  should  be  Article  207  in  conjunction  with  Article 
218(9) TFEU. 

5. 

PUBLICATION OF THE ENVISAGED ACT 

As  the  act  of  the  Meeting  of  the  Participants  will  amend  the  Arrangement  on  Officially 
Supported Export Credits, it is appropriate to publish it in the Official Journal of the European 
Union after its adoption. 

5 

Judgment  of 
ECLI:EU:C:2014:2258, paragraphs 61 to 64.  

the  Court  of  Justice  of  7  October  2014,  Germany  v  Council,  C-399/12, 

EN 

3 

  EN 

 
                                                 
2018/0289 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be taken on behalf of the European Union in the Meeting of the 
Participants to the Arrangement on Officially Supported Export Credits 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 207 in conjunction with Article 218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

The guidelines contained in the Arrangement on Officially Supported Export Credits 
(‘the Arrangement’) apply in the Union by virtue of Regulation (EU) No 1233/2011 of 
the European Parliament and of the Council67.  
The 140th session of the Meeting of the Participants to the Arrangement, to take place 
in  the  week  the  14th  November  2018,  is  to  adopt  a  decision  to  expand  the  scope  of 
Annex  V  of  the  Arrangement  on  Officially  Supported  Export  Credits  (Sector 
Understanding  on  Export  Credits  for  Rail  Infrastructure)  to  include  cable  cars  and 
trolleybuses, as proposed by the Union. 

It  is  appropriate  to  establish  the  position  to  be  taken  on  the  Union's  behalf  in  the 
Meeting of the Participants to the Arrangement in respect of that proposal. 

Cable cars and trolleybuses are currently not covered by Annex V to the Arrangement. 
To  facilitate  the  financing  of  these  types  of  infrastructure,  especially  in  emerging 
countries, it would be appropriate to expand the scope of Annex V taking into account 
the  difficulties  of  the  public  entities  normally  developing  these  projects  to  access 
finance, the useful life of these infrastructures and their environmental benefits. 

HAS ADOPTED THIS DECISION: 

The position of the Union shall be to support the expansion of the scope of Annex V of the 
Arrangement on Officially Supported Export Credits (Sector Understanding on Export Credits 
for Rail Infrastructure) to include cable cars and trolleybuses. 

Article 1 

6 

7 

Regulation (EU) No 1233/2011 of the European Parliament and of the Council of 16 November 2011 
on the application of certain guidelines in the field of officially supported export credits and repealing 
Council Decisions 2001/76/EC and 2001/77/EC (OJ L 326, 8.12.2011, p. 45). 
In  the  past,  earlier  versions  of  the  OECD  Arrangement  had  already  been  transposed  into  EU  law  by 
Council Decisions. 

EN 

4 

  EN 

 
                                                 
This Decision is addressed to the Commission. 

Done at Brussels, 

Article 2 

For the Council 
The President 

EN 

5 

  EN