Environmental and Social Impact Assessment (OECD)
The principle of permanently sustainable development requires reduction of negative impacts of human economic activity, including export or investment projects, on the living and social environment. OECD has paid long-term attention to these issues and has regulated this sensitive area with its guidelines.
In this context, in 2004 OECD Council adopted and subsequently reviewed (for the last time in 2016) the Recommendation of the Council on Common Approaches for Officially Supported Export Credits and Environmental and Social Due Diligence (the so-called “Common Approaches"). The Czech Export Bank, similarly as EGAP, has used this document as a basis for formulation of requirements for exporters and for the determination of the process of assessment of the impact of export on the living and social environment. Generally, the Common Approaches stipulate the commitment of all member countries not to support through their institutions projects that cause damage to the living or social environment.
The last review of the Common Approaches in 2016 extended and reinforced the original provisions by a stronger emphasis on environmental and social aspects of officially supported exports, determined a more clear procedure of project classification and reinforced attention paid to aspects affecting human rights in the project implementation countries.
CEB Procedure for Environmental and Social Impact Assessment of Export
All types of state supported export credits, with the exception of export of military equipment and agricultural commodities, with maturity exceeding two years are subject to environmental and/or social impacts assessment by the Czech Republic.
If an export project is insured by EGAP (Export Guarantee and Insurance Corporation), an international financial institution or any other export credit agency from OECD countries (the so-called ECA, Export Credit Agency), CEB does not perform the assessment and relies on the assessment of such institutions. Otherwise, the procedure is as follows:
Project categorization and required documents
Together with an application for the provision of a supported financing, the exporter/investor submits a completed questionnaire and affidavit.
In cases when:
i) the value of an export project exceeds CZK equivalent of 10 mil. SDR (converted using the CNB exchange rate on the date of the application submission);
ii) the export project falls within the so-called sensitive area or in its immediate vicinity (sensitive areas include, among others, national parks, Protected Landscape Areas, wetlands, forests with high level of biological diversity, areas of archaeological or cultural significance or areas significant for native inhabitants);
iii) the export project is connected with high probability of severe impacts on human rights
the applicant is asked by CEB in writing to submit a copy of the questionnaire and affidavit to an external expert with the purpose of the project categorization. A list of authorized experts pursuant to Act No. 100/2001 Coll., is available at the web site of the EIA Information System of the Ministry of the Environment.
The external expert will subsequently decide on the export project classification into one of the A-C categories. Individual categories have different requirements on the preparation of further supporting documentation.
Category A: projects with potential of diverse, irreversible and unprecedented significant negative environmental and/or social impacts. For examples of category A projects see below. In case of projects of this category, the applicant shall submit to CEB ESIA (Environmental and Social Impact Assessment), whereas the submission of a positive assessment is a precondition for the provision of supported financing.
Category B: projects with potential less significant negative environmental and/or social impacts than with category A. In case of projects of this category, the applicant shall submit an assessment of environmental and/or social impacts in a scope that is usually lesser than the ESIA, whereas the submission of a positive assessment is a precondition for the provision of supported financing.
Category C: projects with potential minimum or no negative environmental and/or social impacts. In such case, CEB does not require the submission of any assessment.
In case of a project, for which ESIA was prepared in the past, CEB may, following the assessment authorization by an external expert, rely on such assessment while evaluating the project.
Information Monitoring and Publishing
In case of categories A and B, CEB may request written monitoring reports in a scope determined in the expert opinion.
If an export project is classified to category A, the applicant must ensure publication of information about the project before the final decision on the supported financing provision latest 30 days before the credit agreement signing.
At least once a year (ex-post), CEB shall publish aggregate information on export projects of category A and B, for which the provision of supported financing was approved.
CEB shall further provide reports with information about the supported projects to the Export Credit Group OECD at least on a semi-annual basis.
Publication of information with projects insured by EGAP
As mentioned above, CEB performs independent assessment of impacts on the living and social environment only for projects not insured by EGAP. In other cases, the assessment is performed by EGAP and CEB only receives the assessment result. In such cases, EGAP publishes mandatory information on environmental impacts at its web sites based on a bilateral agreement with CEB. This procedure was established in view of the joint effort of CEB and EGAP at reducing administrative burden in connection with the application for supported financing and facilitating the processing of applications of Czech exporters as efficiently as possible.
Recommendation of OECD on Common Approaches for Officially Supported Export Credits and Environmental and Social Due Diligence (the so-called “Common Approaches”)
Further information on individiual projects
Further information on projects here.
Illustrative list of category A projects (page 16 of the Common Approaches)