OECD Arrangement: official export credit rules

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.

The January 2026 consolidated text (TAD/PG(2026)1) is the operative desk reference for Participant export credit agency (ECA) programmes and for banks structuring covered buyer credit and pure-cover 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. This hub maps purpose, status, financial ceilings, Sector Understandings, premium and interest-rate floors, project-finance treatment, and the boundary with national product rules.

OECD Arrangement purpose, status and Participants

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. Its purpose is a framework for the orderly use of officially supported export credits and a level playing field among Participants.

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. Non-Participants may observe or receive information under the text's transparency provisions, but they are not bound by the mutual discipline that Participants apply to one another.

Official support under the Arrangement takes the forms of:

• export credit guarantee or insurance (pure cover)
• official financing support through direct credit or financing, refinancing, or interest-rate support
• 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. It does not apply to military equipment or agricultural commodities. Tied aid and trade-related untied aid are addressed in separate chapters and procedures that sit beside the core export-credit financial terms.

Because the Arrangement is a gentlemen's agreement, compliance is reciprocal and political rather than litigated as a treaty obligation. Participants notify terms, may match competing offers under the matching rules, and rely on transparency to police breaches. For credit desks the practical effect is 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.

Core financial terms under the OECD Arrangement

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 must make down payments of at least 15% of the export contract value at or before the starting point of credit. Except for permitted local-cost and related provisions, Participants shall not provide official support above 85% of the export contract value (third-country supply included, local costs excluded). Premium may be financed or insured in whole, and may or may not be included in export contract value, subject to the text's definitions. 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.

Local costs. Countries are classified 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 is 40% of export contract value for Category I destinations and 50% for Category II destinations. Local-cost support must not be on more favourable terms than the related export support. Local-cost support above 15% of export contract value requires prior notification.

Maximum repayment terms. Without prejudice to useful-life limits, the general maximum repayment term is 15 years. For certain power plants that cannot benefit from support under Annex I or Annex II, the maximum is 12 years. Prior notification applies where official support will be granted for a transaction with a repayment term longer than ten years and a credit value equal to or greater than SDR 10 million.

Amortisation. Principal is normally repaid in equal and regular instalments, or principal and interest may be repaid in equal instalments where justified (for example for leases or machinery). Principal instalments are due at intervals of no more than one year, with the first principal payment no later than one year after the starting point of credit.

Interest is payable at intervals of no more than six months in the standard case, and interest due after the starting point of credit is not capitalised. Where cash-flow mismatch justifies flexibility, the text caps any six-month principal repayment at 30% of principal, requires the first principal repayment within 24 months of the starting point of credit, and limits weighted average life to the longer of 65% of the repayment term or six years.

Interest-rate floors. Where official financing support is provided at fixed interest rates, Participants apply commercial interest reference rate (CIRR) construction and application rules as the interest-rate floor for covered currencies. 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.

Tied versus untied. Arrangement-tied export credit is linked to an export contract within content rules. 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.

Sector Understandings, premium floors and country risk

Sector Understandings in the 2026 text set sector-specific terms for:

• Climate Change Sector Understanding (Annex I)
• Nuclear Sector Understanding (Annex II)
• Aircraft Sector Understanding (Annex III)
• Ship Sector Understanding (Annex IV)

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. Sector texts can extend or modify tenor, starting-point definitions, and eligibility relative to Chapter II.

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. 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.

Market-benchmark pricing rules apply to 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.

Project finance treatment and bank desk consequences

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.

When official support sits inside a syndicated loan package structured as asset-backed or project finance and subject to market-benchmark rules, the text requires that at least 25% of the syndicated financing be commercial loans or commercial guarantees without bilateral or multilateral official support, with all parties on pari passu financial terms including the security package, and that direct-loan all-in cost or pure-cover premium not undercut the commercial participants (subject to minimum actuarial premium). 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. National products may be narrower or stricter than Arrangement ceilings. UKEF eligibility also requires UK business presence for the exporter, acceptable banks, foreign-content policy compliance, anti-bribery and environmental, social and human rights due diligence, and states that a transaction may not be supported if sanctions are imposed on the country of the overseas buyer.

Instrument form still matters. Buyer credit places the loan with the overseas buyer. 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 and in short-term versus medium or long-term markets in short-term vs MLT export credit. Buyer versus supplier allocation is compared in buyer credit vs supplier credit.

National ECAs that implement Arrangement-scoped products include UKEF, US EXIM, Hermes AGA, SACE, Bpifrance, Atradius DSB, EDC, JBIC, NEXI, EKN and Finnvera.

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 MLT official support separate from private short-term credit insurance and from investment political risk insurance (PRI).

Boundaries, matching and what the Arrangement does not do

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, AML, environmental and social, or anti-bribery rules. It does not price commercial loans outside official support.

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. Those procedures are institutional compliance steps for ECA underwriters and covered banks, not a substitute for credit approval.

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.

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.