EDC — Performance Security Insurance
Canada
Protection against letter of guarantee losses
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|noCondition
grant_single|deadlines
- grant_single|openingDateJuly 01, 2024
- grant_single|closingDateJuly 09, 2024
grant_single|financingType
Other Support
grant_single|eligibleIndustries
- grant_single|allIndustries
grant_single|grantors
- Government of Canada
- Export Development Canada (EDC)
grant_single|status
grant_card_status|open
grant_single_labels|preview
Protect your cash flow, get coverage of up to 95% of your insured losses if a customer wrongfully calls a letter of guarantee or if a call is triggered by you not being able to meet your obligations due to specific political risks.
grant_single_labels|projects
grant_single|admissibleProjectsExample
$760,000
Financial coverage for the export of medical equipment to Turkey
$475,000
Coverage for wrongful calls of guarantee on exported agricultural machinery to Russia
$570,000
Coverage on exporting IT solutions to Nigeria
$1,425,000
Protection against wrongful calls for exported clean energy technology to India
$1,140,000
Protection against wrongful calls for a construction project in Brazil
$1,900,000
Coverage for wrongful calls on a renewable energy project in Mexico
grant_single_labels|admissibility
Eligibility for this grant is determined by specific conditions related to the commercial and political risks associated with the applicant's international trade activities.
- The eligibility is assessed based on EDC's review of the letter of guarantee.
- Considerations include the conditions and economic outlook in the applicant's customer's country.
- The customer's profile is also reviewed to determine eligibility.
- The potential for commercial risks, such as wrongful or excessive calls of bank instruments by the counterparty, is evaluated.
- Potential political risks are considered, including rightful calls due to non-performance linked to war, export/import permit issues, government actions, acts of God, and unresolved commercial disputes.
grant_eligibility_criteria|who_can_apply
Eligible companies for this grant must meet the criteria set by EDC, including having a letter of guarantee, a stable economic outlook in their country, and a suitable customer profile.
- Companies with a letter of guarantee
- Companies with a stable economic outlook in their country
- Companies with a suitable customer profile
grant_eligibility_criteria|eligible_expenses
There are eligible expenses for this grant. The summary of eligible expenses includes:
- Commercial risks coverage for wrongful or excessive calls of the bank instrument by the counterparty
- Political risks coverage for rightful calls due to non-performance under the contract related to war, government actions, or acts of God
grant_single_labels|criteria
There are evaluation and selection criteria for this grant. Eligibility is determined by EDC based on a review of the letter of guarantee, conditions and economic outlook in the customer’s country, and the customer’s profile. Commercial risks include wrongful or excessive calls of the bank instrument by the counterparty, while political risks involve rightful calls due to non-performance under the contract based on specific events.
- Review of the letter of guarantee
- Conditions and economic outlook in the customer’s country
- Customer’s profile
- Commercial risks: wrongful or excessive calls of the bank instrument
- Political risks: rightful calls due to non-performance under the contract based on specified events
grant_single_labels|register
Here are the steps to submit an application for this grant:
- Step 1: Prepare Documentation
- Review the terms and conditions of the letter of guarantee.
- Analyze the economic outlook in your customer’s country and assess the customer’s profile.
- Identify and document both commercial risks and political risks associated with the project.
- Step 2: Contact EDC
- Reach out to EDC representatives to confirm your eligibility based on the prepared documentation.
- Seek clarification on any specific requirements or additional documents needed.
- Step 3: Complete Application Forms
- Obtain and fill out the necessary application forms provided by EDC.
- Ensure all information is accurate, complete, and aligns with your initial documentation.
- Step 4: Submit Application
- Compile all completed forms and supporting documents such as the letter of guarantee and risk assessments.
- Submit the application package via EDC’s designated submission channel, which may be an online portal or physical mail.
- Step 5: Acknowledge Receipt
- Upon submission, note any confirmation or application reference number provided by EDC.
- Keep records of all submitted documents and confirmations for future reference.
Apply to this program
Understanding EDC's Grant for International Business Stability
Export Development Canada (EDC) offers a crucial financial safety net for Canadian businesses looking to expand internationally, mitigating both commercial and political risks that can impact contractual obligations. This grant program aims to secure businesses against external economic disturbances, ensuring continuity and stability in export ventures.
Comprehensive Insights into EDC’s Risk Mitigation Framework
The Export Development Canada (EDC) grant offers a strategic financial instrument designed to support Canadian businesses in navigating the complexities of international trade. This initiative primarily focuses on providing assurance against unforeseen risks that can disrupt contractual operations abroad, thus allowing businesses to expand with greater confidence.
One of the key components of this grant is its emphasis on understanding and mitigating commercial risks. These include wrongful or excessive calls on bank guarantees by foreign counterparts, which can occur when the terms of signed contracts or bid processes are not honored. Such events pose significant financial threats, and EDC’s grant is structured to safeguard businesses from these vulnerabilities, ensuring they have the backing they need to manage and respond to these challenges effectively.
Additionally, EDC’s program is designed to address several political risks which are often beyond the control of businesses operating internationally. This encompasses rightful calls due to war, civil disturbances, as well as actions stemming from government policies that may interfere with trade dynamics—such as cancellations of essential export or import permits, or the implementation of policies that restrict payments.
Through carefully tailored strategies, EDC’s grant aids businesses in overcoming these obstacles, thus maintaining consistent and fair international trade practices. Further, it provides coverage against occurrences that could be classified as acts of God, ensuring businesses are not financially jeopardized by natural events that disrupt international operations.
Crucially, the grant allows businesses to focus on growth and innovation without the persistent fear of encountering insurmountable foreign market challenges. By offering financial assurance and risk mitigation, the EDC grant encourages Canadian businesses to explore global opportunities, bolstering their resilience in volatile markets.
Ultimately, this program underscores the mission of EDC: to empower Canadian enterprises in establishing profitable and sustainable international connections. By leveraging such financial instruments, businesses are better placed to adapt to unpredictable market dynamics while safeguarding their contractual commitments and ensuring long-term prosperity.
