Eligibility for cover of project structures
In reality, project structures are often more complex than in the simplified presentation below showing a project including an Untied Loan Guarantee. The Federal Government takes these conditions on the raw materials markets into account, and is therefore prepared to also accept the in principle eligibility for cover for projects with a deviating structure.
In the past the following project structures were evaluated as eligible for cover in principle on a case-by-case basis:
Raw material processing
The Federal Government has accepted the in principle eligibility for cover of the raw materials processing in third countries prior to the resources’ delivery to German offtakers since processing possibilities for unprocessed raw materials are often not available in Germany.
Offtake schemes including swap agreements
Due to logistic and economic aspects it may be necessary for raw material offtakers to swap raw material quantities and qualities as opposed to importing them directly from the mine to Germany. Based on contractual agreements raw material of equivalent quantity and quality (for instance from a third mine) can be delivered to the German offtaker in return for the swapped resources. Additionally, this process can partly improve the raw materials project’s environmental balance.
Purchase by marketing agents
The Federal Government has accepted projects whose raw materials were purchased directly by a marketing agent who, in turn, passed on firmly contracted quantities to final offtakers in Germany. This procedure was deemed acceptable in particular when German raw material offtakers could only purchase comparatively small quantities of a project’s raw materials due to the size of their enterprise. The intermediary marketing agent enables the pooling of the raw material quantity which is then made available to several German final offtakers.
Purchase by a foreign parent company and processing by its German subsidiary
Due to the increasing internationalisation, foreign parent companies may conclude the raw material contract on the condition that the German subsidiary receives and processes the raw material contract’s quantities.
Purchase of secondary raw materials (Recycling)
The import of secondary raw materials (raw materials gained by recycling) has been considered as in principle eligible for cover in exceptional cases.
Basic structure of a raw material project including an Untied Loan Guarantee
Do you have any further questions regarding project structures’ eligibility for support?
Please do not hesitate to contact our specialists who will be pleased to assist you with any questions regarding cover for project structures.