Export Development Canada (EDC/Canada)

Political Risk Insurance

Instrument Type

Insurance

Eligible investments, borrowers, and projects

Overseas investments that are beneficial to Canada including :
- Direct investment with joint venture or foreign subsidiary
- Loans issued to a joint venture or foreign subsidiary
- Physical assets held overseas
- Other forms of asset or commitment held overseas

Eligible beneficiaries

Lenders, private sector companies

Eligible forms of investment

Equity: equity (paid-in-capital)
Debt: Loans, shareholder loans
Guarantees: e.g. financial guarantees or completion guarantees, physical assets, service agreements, production sharing contracts (only related to political risks)

Risk types covered

Political Risk Insurances
• Breach of contract
• Creeping or outright expropriation
• Political Violence
• Transfer and Convertibility restrictions
• Repossession
• Non-payment by a government

Maximum tenor

up to 15 yrs. (unless otherwise approved)

Maximum amount or cover

• Equity coverage: normally 90% of eligible losses, no stated project limit
• Bank loans: up to 100% of principal and interest, no stated project limit

Fees

Premiums based on country, industry, and transaction characteristics and number of risks covered; discounts apply if more than one risk is insured against.