European Investment Bank – Uruguay Approves the Framework Treaty for Financial Cooperation Â
Written by Bergstein Abogados
The Parliament recently ratified the Framework Treaty on Financial Cooperation with the European Investment Bank (“the Treatyâ€).
The European Investment Bank (“the Bankâ€) was established in 1958 within the framework of the European Union, with the objective of financing projects that: (i) boost European growth and employment, (ii) support measures aimed at mitigating climate change and (iii) promote European Union policies in non-Union countries.
The Bank offers three main types of products and services: loans, blended financing (combining Bank financing with other investments); and advice and technical assistance to achieve maximum profitability of the money. Direct loans can amount to approximately 25 million euros; for smaller loans, the Bank opens credit lines with financial institutions so that they can lend the money to the beneficiaries.
The Treaty establishes that any private, public or mixed company established in accordance with Uruguayan legislation (whether national or foreign) will have access to financing granted by the Bank.
Loans to be granted under the Treaty shall follow the following guidelines: (i) they shall be intended to finance investment projects that meet the Bank’s requirements; (ii) they shall be aligned with the Bank’s general objectives; (iii) the interest rate and guarantees shall be determined by the Bank in accordance with its usual practices and shall not be subject to taxes, fees or levies; and (iv) they shall be treated equally to that provided for in Uruguayan regulations and/or in bilateral investment agreements ratified by Uruguay.
In short: a new financing alternative for national companies.
