OECD Arrangement desk primer

The OECD Arrangement (Arrangement on Officially Supported Export Credits) is the Participants' gentlemen's agreement that disciplines officially supported export credits with a repayment term of two years or more, so exporters compete on quality and price rather than on the most favourable official financing terms. This primer is the long desk reading beside the shorter OECD Arrangement hub and the institutional page for OECD export credits.

The January 2026 consolidated text (TAD/PG(2026)1), effective 22 January 2026, replaces the September 2024 version and is the operative reference for Participant export credit agency (ECA) programmes and for banks structuring covered buyer credit, pure-cover and official-financing facilities. The Arrangement is not an OECD Act. It receives administrative support from the OECD Secretariat while Participants set and police the rules among themselves.

OECD Arrangement purpose, status and Participants

Article 1 states that the main purpose is a framework for the orderly use of officially supported export credits. The Arrangement seeks a level playing field for official support so that competition among exporters rests on the quality and price of goods and services rather than on the most favourable official support.

Background material to OECD/LEGAL/5005 records that the Arrangement was adopted on 22 February 1978 and came into force on 1 April 1978, building on an earlier export-credit Consensus among a smaller group of OECD Members. The text is of indefinite duration. Status language in TAD/PG(2026)1 confirms that the Arrangement is a Gentlemen's Agreement among the Participants and is not an OECD Act, although it receives OECD Secretariat administrative support.

Participants listed in the 2026 instruments are Australia, Canada, the European Union, Japan, Korea, New Zealand, Norway, Switzerland, Türkiye, the United Kingdom and the United States. Other OECD Members and non-members may be invited to become Participants by the current Participants. Non-Participants may receive information under the text's transparency provisions, but they are not bound by the mutual discipline that Participants apply to one another.

Because compliance is reciprocal and political rather than litigated as a treaty obligation, the practical desk effect is still hard. An Arrangement-scoped commitment that exceeds permitted tenor, support percentage or minimum pricing is out of bounds for Participant ECAs regardless of commercial appetite. Matching and notification procedures, not court enforcement, are the institutional policing tools.

Scope of application and forms of official support

Article 5 defines official support for Arrangement purposes as export credit guarantee or insurance (pure cover); official financing support through direct credit or financing, refinancing, or interest-rate support; and any combination of those forms. The Arrangement applies to official support for exports of goods and/or services, including financial leases, with a repayment term of two years or more.

The Arrangement does not apply to exports of military equipment or agricultural commodities. Official support shall not be provided if there is clear evidence that a contract has been structured with a purchaser in a country that is not the final destination of the goods, primarily to obtain more favourable repayment terms. Tied aid and trade-related untied aid sit in separate chapters and procedures beside the core export-credit financial terms. The distinction between tied and untied financing and the national content requirements determine how much foreign supply can sit inside a supported contract and when programmes run outside classic tied export credit.

Instrument form still matters for credit allocation. Buyer credit places the loan with the overseas buyer or borrower. Supplier credit keeps credit with the exporter or with paper under the export contract. Pure cover versus official financing support is compared in export credit insurance vs guarantee. Short-term versus medium or long-term markets are compared in short-term vs MLT export credit. Buyer versus supplier allocation is compared in buyer credit vs supplier credit.

The Berne Union is industry association context for export credit and investment insurance capacity and data. It is not the Arrangement's rule-making body. Berne Union materials distinguish short-term trade credit, medium and long-term export credit, and investment insurance, which helps desks keep Arrangement-scoped medium and long-term official support separate from private short-term credit insurance and from investment political risk insurance (PRI).

Core financial terms under Chapter II

Chapter II limits financial terms and conditions. Those limits are read together. Participants also recognise that some commercial or industrial sectors traditionally use stricter terms than the Arrangement ceilings, and that repayment should not exceed the useful life of the exported goods and services or, where relevant, of the destination project.

Down payment and maximum official support. Purchasers of goods and services that are the subject of official support must make down payments of a minimum of 15% of the export contract value at or before the starting point of credit as defined in Annex XIII. For assessing down payments, export contract value may be reduced proportionally if the transaction includes goods and services from a third country that are not officially supported.

Financing or insurance of 100% of the premium is permitted. Except as provided for local costs and related paragraphs, Participants shall not provide official support in excess of 85% of the export contract value, including third-country supply but excluding local costs. Retention money after the starting point of credit does not count as down payment.

National programmes implement those ceilings in product rules. UKEF's Buyer Credit Facility states that the maximum amount available under the loan is 85% of contract value and that a minimum of 15% must be paid directly to the exporter by the buyer before the loan starts to be repaid, with a repayment period of at least two years. UKEF can consider support for corporate, sovereign and public buyers and lists limited recourse project finance, Islamic finance, public-private partnerships and capital markets refinancing among structures it can support, subject to eligibility, foreign-content, anti-bribery and environmental, social and human rights due diligence.

Local costs. Article 10 classifies countries for local-cost support. Category I countries are High Income OECD Countries as defined by World Bank GNI per capita criteria used in the Arrangement. All other countries are Category II. Maximum official support for local costs shall not exceed 40% of export contract value for Category I destinations and 50% for Category II destinations. Official support for local costs shall not be provided on terms more favourable or less restrictive than those agreed for the related exports. Where official support for local costs exceeds 15% of export contract value, prior notification under Article 44 is required.

Maximum repayment terms. Without prejudice to useful-life limits, the general maximum repayment term is 15 years. For any power plant that is not eligible to be supported under Annex I or Annex II, the maximum is 12 years. The Participant shall give prior notification in accordance with Article 44 when official support will be provided for any transaction with a repayment term greater than ten years and a credit value of SDR 10 million or more.

Amortisation. The principal sum of an export credit shall normally be repaid in equal and regular instalments or, when appropriate (for example for lease transactions or for the export of stand-alone machinery or equipment), equal repayments of principal and interest combined. Principal shall be repaid no less frequently than annually, and the first instalment of principal shall be made no later than one year after the starting point of credit.

Interest shall be paid no less frequently than every six months, with the first interest payment no later than six months after the starting point of credit, except that where principal is repaid annually interest may be paid no less frequently than every twelve months. Interest due after the starting point of credit shall not be capitalised.

Where duly justified by an imbalance between available funds and the standard debt-service profile, or where the amortisation schedule does not match free cash flow, Article 13 e) permits constrained flexibility: no single repayment of principal or series of principal payments within a six-month period shall exceed 30% of the principal sum of the credit; the first repayment of principal shall be made no later than 24 months after the starting point of credit; and the maximum weighted average life of the repayment period is the greater of 65% of the repayment term or six years. Prior notification under Article 44 applies when that flexibility is used for any transaction with a credit value of SDR 10 million or more.

Sector Understandings and the annex map

Article 7 provides that the four Sector Understandings are part of the Arrangement. In the 2026 table of contents they are:

• Annex I: Sector Understanding on Export Credits for Climate Change
• Annex II: Sector Understanding on Export Credits for Nuclear Power Plants
• Annex III: Sector Understanding on Export Credits for Civil Aircraft
• Annex IV: Sector Understanding on Export Credits for Ships

Participants to the Aircraft and Ship Sector Understandings differ from those of the general Arrangement. Climate and nuclear Sector Understandings share the general Participant set. For goods or services covered by Annex III, Participants that are also Aircraft Sector Understanding Participants shall apply Annex III.

The remaining annexes are technical schedules rather than free-standing product regimes:

• Annex V: Information to be Provided for Notifications
• Annex VI: Calculation of the Minimum Premium Rates for Country Risk Category 1 to 7 Transactions
• Annex VII: Premium Benchmarks for Market Benchmark Transactions
• Annex VIII: Criteria and Conditions Governing the Application of a Third-Party Repayment Guarantee and the Classification of Multilateral or Regional Institutions
• Annex IX: Buyer Risk Categories Qualitative Descriptions
• Annex X: Criteria and Conditions Governing the Application of Country Risk Mitigation Techniques and Buyer Risk Credit Enhancements
• Annex XI: Checklist of Developmental Quality
• Annex XII: Commercial Interest Reference Rate (CIRR) Provisions
• Annex XIII: List of Definitions

A shorter annex-by-annex reading sits in The OECD Arrangement Annexes Explained. Sector texts can extend or modify tenor, starting-point definitions, and eligibility relative to Chapter II. Climate, nuclear, aircraft and ship packages therefore need a dual read: Chapter II ceilings plus the relevant Sector Understanding.

Premium floors, CIRR and country risk classification

Minimum premium rates for credit risk are a core Arrangement discipline. ECA premium floors reference OECD country risk classification (CRC), buyer-risk category, percentage and quality of cover, and related credit-enhancement or risk-mitigation factors under Annexes VI to X.

Country risk classifications run through Categories 0 to 7. Minimum premium rates are established for Categories 1 to 7. Category 0 is treated differently because country risk is judged negligible for premium-matrix purposes. Classifications are monitored continuously, reviewed at least annually, and published by the Secretariat. When a country is reclassified, Participants apply the corresponding minimum premium rates within the text's operational deadlines.

Buyer-risk classification places borrowers and guarantors in buyer-risk categories relative to their country of domicile. Sovereign borrowers and guarantors are classified in the SOV/CC0 buyer-risk category under the text's rules. Project-finance transactions, as defined in the Arrangement, and transactions with credit value not exceeding SDR 5 million may be classified under the specific buyer-risk flexibilities stated in the text. Qualitative buyer-risk descriptions sit in Annex IX.

Market-benchmark pricing rules apply to Category 0 countries, high-income OECD and high-income euro-area obligors and to certain multilateral or regional institutions treated as generally not subject to host-country transfer and convertibility controls. In those cases Participants must not undercut private-market pricing references, subject to minimum actuarial premium floors and prior-notification triggers under Annex VII.

Where official financing support is provided at fixed interest rates, Participants apply CIRR construction and application rules in Annex XII as the interest-rate floor for covered currencies. The CIRR for official financing support provided under the Arrangement and its Annexes other than the Aircraft and Ship Sector Understandings is determined and applied under Annex XII. Floating-rate covered lending sits beside CIRR official financing support as a distinct pricing path. The rate choice is compared in CIRR vs floating rate. Country-risk classification mechanics for premium work are illustrated in the OECD CRC explainer.

Comprehensive cover on export credits blends commercial and political causes of non-payment. That product architecture differs from investment political-risk cover and from private trade-credit insurance. Desks mis-price risk when they treat Arrangement buyer-credit cover as interchangeable with MIGA-style investment guarantees or with short-term whole-turnover policies.

Project finance treatment under the Arrangement

The Arrangement defines a project-finance transaction for official-support purposes as an export of goods or services to an independent project company, legally and economically, where the lender treats the project's cash flows and earnings as the source of funds for repayment and the project company's assets as security for the loan. That definition connects official export credit to project finance structures without collapsing the two products into one. A longer reading of collateral architecture sits in the project finance security package guide.

When a Participant provides official support as part of a syndicated loan package structured as either an asset-backed or project finance transaction and subject to market-benchmark rules, the text requires that the all-in cost of the direct lending portion shall be no less than the all-in cost charged by the commercial market participants in the syndicate; that the premium charged for pure cover shall be no less than the translated equivalent price charged by commercial participants, subject to minimum actuarial premium; and that parties stand on pari passu financial terms including the security package.

The text also requires that at least 25% of the syndicated financing be commercial loans or commercial guarantees without bilateral or multilateral official support. Prior notification applies to premium set on that basis.

For bank desks, Arrangement discipline is the institutional baseline whenever a Participant ECA covers or funds medium or long-term export credit into a project company. National products may be narrower or stricter than Arrangement ceilings. Cover ratios such as debt service coverage ratio (DSCR) and loan life cover ratio (LLCR) remain bank credit tools; they are not Arrangement financial-term ceilings. Official support still has to clear down payment, content, premium and tenor rules even when the repayment analysis is pure project finance.

National product implementation and institutional boundaries

The Arrangement does not replace national product rules. It constrains the terms on which Participant official support may be offered for in-scope credits. UKEF eligibility requires that the exporter carry on business in the UK, that the export contract have a value of at least £5 million or foreign-currency equivalent for Buyer Credit Facility applications, that the lending bank be acceptable to UKEF, and that repayment be at least two years. All UKEF-supported transactions must satisfy foreign content policy and anti-bribery and environmental, social and human rights due diligence. UKEF states that a transaction may not be supported if sanctions are imposed on the country of the overseas buyer.

Institutional pages for agencies that implement Arrangement-scoped products include UKEF, US EXIM, Hermes AGA, SACE, Bpifrance, Atradius DSB, EDC, JBIC, NEXI, EKN and Finnvera. A cross-agency product map sits in the ECA product map. The export credit agency pillar hub is export credit agencies.

Country risk enters Arrangement work through the published country-risk classifications that drive minimum premium, through Category I and II local-cost caps, and through national cover policies that may refuse support even where Arrangement ceilings would allow it. Transfer, convertibility and sanctions overlays remain separate institutional filters.

Matching, notification and what the Arrangement does not do

Matching and notification procedures allow Participants to respond to competing offers and to police transparency. Prior notification with or without discussion is required for defined deviations and for specified long-tenor or high-value transactions, including local-cost support above 15% of export contract value and repayment terms longer than ten years with credit value of SDR 10 million or more. Those procedures are institutional compliance steps for ECA underwriters and covered banks, not a substitute for credit approval.

The Arrangement does not regulate all cross-border finance. It does not cover military equipment or agricultural commodities. It does not bind non-Participant official lenders. It does not replace national content, sanctions, anti-money-laundering, environmental and social, or anti-bribery rules. It does not price commercial loans outside official support. It does not convert Berne Union data series into binding financial terms.

For credit committees, the desk checklist is institutional rather than commercial. Confirm that the support form is Arrangement-scoped; confirm starting point of credit, down payment and maximum official support including local costs; confirm repayment term against Chapter II or the relevant Sector Understanding; confirm minimum premium and CIRR or floating-rate path; confirm project-finance or market-benchmark syndication tests where they apply; and confirm that national eligibility, content and sanctions filters still clear. The Arrangement supplies the ceiling. National programmes and bank credit analysis supply the rest.