7 novembre 2024A&O Shearman, 1 Bishops Square, London, E1 6AD
Riccardo Sallusti…
Law No. 213 of 30 December 2023 (the “2024 Budget Law”), published in Official Gazette No. 303 of 30 December 2023, provides for the possibility for SACE S.p.A. (“SACE”) to issue a new type of guarantee. More specifically, pursuant to Article 1, paragraph 259, of the 2024 Budget Law, “in order to support infrastructural and productive investments made in Italy, including in areas characterized by conditions of partial market failure and sub-optimal levels of investment, related to the high riskiness also associated with medium- and long-term exposures, the use of innovative technologies or the limited offer of financial products, SACE is empowered to issue, until 31 December 2029, guarantees related to investments in the sectors of infrastructure, including of a social nature, local public services and industry and processes of transition to a circular economy, sustainable mobility, adaptation to climate change and mitigation of its effects, environmental or climate sustainability and resilience as well as industrial, technological and digital innovation of businesses” (“Garanzia Archimede”).
1.1 Addressees of Garanzia Archimede
Garanzia Archimede can be granted to:
(i) parties identified as implementing partners under the InvestEU program referred to in Regulation (EU) 2021/523 of the European Parliament and of the Council of 24 March 2021 ([1]);
(ii) banks, domestic and international financial institutions and other entities licensed to engage in lending in Italy;
(iii) domestic and international insurance companies, licensed to conduct credit and surety business in Italy in connection with sureties, guarantees and other signature commitments; and
(iv) subscribers to bonds, promissory notes, debt securities and other financial instruments, whether equity- or non-equity-based, convertible, including subordinate ones.
1.2 Scope, term and amount of Garanzia Archimede
Garanzia Archimede can guarantee loans, in any form, including portfolios of loans, granted to undertakings with a registered office in Italy and undertakings with a registered office abroad with a permanent establishment in Italy, other than small and medium-sized enterprises, as defined by Commission Recommendation 2003/361/EC of 6 May 2003, and undertakings in difficulty, as defined by Commission Communication 2014/C 249/01.
Garanzia Archimede can be granted for a maximum term of twenty-five years and for a maximum coverage percentage not exceeding the following thresholds:
In addition, the percentage of coverage of guarantees on bonds, promissory notes, debt securities and other financial instruments granted to guaranteed parties may be raised up to 100 percent, without prejudice to the limits set out in the risk management document that SACE is required to send quarterly to the Ministry of Economy and Finance - Department of the Treasury.
It should be noted that the commitments arising from the grant of Garanzia Archimede (which is issued at market conditions) are assumed by SACE to the extent of 20 percent and by the State to the extent of 80 percent of the principal and interest of each commitment, without any joint and several liability between the two entities. SACE itself determines the premiums as remuneration for the guarantees in accordance with the characteristics and risk profile of the underlying transactions, taking into account their nature and the objectives achieved by them in accordance with the purposes of the investments to be guaranteed, which are more fully described in the beginning of this article.
1.3 Materiality thresholds for MEF intervention
The grant of Garanzia Archimede:
is subject to a declaration of non-impediment by the Minister of Economy and Finance adopted on the basis of the inquiry forwarded by SACE for loan portfolio guarantees.
1.4 Next steps
Pursuant to Article 1, paragraph 265 of 2024 Budget Law, “the operational procedures for the purposes of the assumption and management of guarantees, their enforcement and the recovery of credits, as well as the documentation required for the purposes of the grant of guarantees, including the contractual remedies provided in relation to the failure of the guaranteed party to meet the prescribed undertakings, are established by SACE; therefore, it is now expected that SACE itself will proceed, in accordance with its own operational practice, to publish, on its website, the guidelines that are necessary to make the new guarantee instrument fully operational”.
At this stage, we are waiting for said guidelines to be published.
In order to support technological innovation and the digitalisation process, to invest in infrastructure and sustainability, in strategic supply chains and economically disadvantaged areas, and also to support the development of female entrepreneurship, SACE is offering Italian companies a new guarantee instrument with the characteristics outlined below (“Garanzia Futuro”).
2.1 Requirements for accessing Garanzia Futuro
To access the guarantee, undertakings must:
2.2 Addressees of Garanzia Futuro
Garanzia Futuro can be granted to:
that comply with appropriate organisational, supervisory, capitalisation and operational principles.
2.3 Requirements of the loan
Article 2.2 of the general terms and conditions of Garanzia Futuro also provides for the obligation to credit the financing to a current account in the name of the beneficiary company and opened with the lender. According to the FAQ, this must not be a dedicated account.
The maximum principal amount of the loan (which, as explained in FAQ No. 44 of Garanzia Futuro , cannot be under pool management) and the duration of the loan must be agreed between the parties as set out in Annex 2 of the general terms and conditions of Garanzia Futuro (Special Terms and Conditions). In this regard, it should be noted that, as specified in the FAQs of Garanzia Futuro , it is possible to support medium/long-term loans for a principal amount ranging from a minimum of 50,000.00 Euros to a maximum of 50,000,000.00 Euros with a duration of between 2 and 20 years.([5]) The loan may have a so-called French amortisation with constant instalments or, alternatively, an Italian amortisation with a constant principal amount. If the loan agreement provides for a French amortisation with constant instalments, it will only be possible to negotiate a fixed rate and not a variable rate.
The purpose of the SACE-guaranteed loan must be indicated in the “Self-certification of Strategic Significance” (a certificate describing the operations being financed) to be attached to the loan application and must fall within one of the following options: “payment of costs and expenses([6]), inherent to the typical production activity of the beneficiary company, to be incurred for:
Should the loan be intended to finance costs and expenses for the preparation of a supply of goods and/or services, such supply must not fall within the scope of (a) the regulations concerning dual-use items and/or technologies or military items subject to licensing under the relevant national, European Union and United States of America regulations (e.g. EU Reg. No. 821/2021, Law 185/1990, Legislative Decree 221/2017, EAR, ITAR); (b) national and European Union export/import control provisions([7]).
2.4 Characteristics of Garanzia Futuro
Garanzia Futuro is a first-demand guarantee provided by SACE and the Italian State up to the limits of a quota equal to, respectively, 10% and 90% of the guaranteed debt, which is explicit, irrevocable, covering the risk of non-repayment of the loan, both for principal and interest, for a quota equal to 70% of the secured debt, without any joint and several liability between the two parties, and which is admitted as collateral and mentioned in the text of the guarantee issued by SACE and up to a maximum amount equal to the amount indicated in the text of the guarantee issued by SACE.
Once the lender has received the loan application from the company, it will carry out the credit appraisal. Following the approval of the financing transaction by the decision-making body, the lender will submit the application for Garanzia Futuro. SACE will then carry out the necessary investigation preliminary to the granting of the guarantee. In the event of a positive outcome, the guarantee will be issued through the ExportPlus online portal, using the guarantee model contained in Annex 6 (SACE Guarantee) of the general terms and conditions of Garanzia Futuro, also communicating to the lender the CUI (Unique Identification Code) relating to such guarantee.
The first or single disbursement of the loan must take place within 60 days from receipt of SACE’s communication of the positive outcome of the preliminary investigation and, therefore, of the issue of the guarantee.
SACE also introduced a further guarantee instrument for the benefit of Italian enterprises, the so-called Garanzia Futuro Light, whose general terms and conditions almost completely mirror those governing Garanzia Futuro. Some of the main differences worth attention concern: (i) the list of eligibility criteria of the beneficiary companies, which with reference to Garanzia Futuro Light does not take into account the credit rating of such companies for the purpose of granting the guarantee, and (ii) the method for determining the commissions due to SACE (which in the case of Garanzia Futuro are also determined on the basis of the credit rating obtained by the beneficiary company, while with reference to Garanzia Futuro Light are determined at SACE’s sole discretion on the basis of internal methodologies and assessments and indicated in the text of the guarantee issued by SACE)([8]).
The 2024 Budget Law (Article 1, Paragraph 269) also provided for the reconfirmation for the year 2024 of the so-called “Green” Guarantee established by Article 64 of Decree-Law No. 76 of 16 July 2020, converted with amendments by Law No. 20 of 11 September 2020 (within the commitment limit that can be assumed by SACE equal to Euro 3 billion).
The content of this document is for information purposes only and is not and cannot be intended as legal advice on the topics dealt with. For further information please contact Roberto De Nardis di Prata, Giuseppe Buono and Davide Brollo.
News([1]) Among others, Cassa Depositi e Prestiti S.p.A., CDP Equity S.p.A., the European Investment Fund, the Council of Europe Development Bank and the European Investment Bank were deemed suitable for the management of European programmes whose implementation is delegated by the Commission to implementing partners.
News([2]) Please note that the 2024 Budget Law does not provide information on whether the consolidated turnover of the group to which the beneficiary company belongs (with reference to the MEF materiality thresholds) should be only at Italian level or include any foreign companies. In this regard, it will be necessary to wait for the adoption of the rules governing the grant of Garanzia Archimede by SACE.
News([3]) This is any reporting by the lender or other credit institutions to the Central Credit Register of the Bank of Italy in any of the following Census Categories or Classification Variables (as provided for in Bank of Italy Circular No.139/1991): (i) “non-performing loans”; (ii) “loans turned to loss”; (iii) “persistent defaults”; and (iv) ratio of “total cash overdrafts” and “total operational cash loans granted” greater than twenty percent; and (b) reporting by the lender to the Bank of Italy’s Central Risk Service in the Classification Variable “probable defaults”.
News([4]) In addition to the above, where the repayment of the loan (for which the guarantee is requested) is fully covered by a guarantee issued by a third-party legal entity, for the purposes of calculating the remuneration due to SACE in relation to Garanzia Futuro, reference shall be made to the credit rating assigned by the lender to the guarantor, if better than that of the beneficiary company provided that (i) the guarantee issued by the guarantor is an autonomous first-demand guarantee and results in the full transfer of risk from the beneficiary company to the guarantor; (ii) the guarantor meets all the requirements provided for beneficiary companies under Article 2.1 (Type of Beneficiary Companies and Characteristics of the Loans) of the general terms and conditions of Garanzia Futuro; and (iii) the guarantor is not a natural person or a partnership.
News([5]) To date, it is reported that some leading banks have already signed an agreement with SACE in order to use Garanzia Futuro for financing transactions in favour of client companies.
News([6]) In the FAQs of Garanzia Futuro it is stated that loans intended to support expenses incurred no more than 18 months prior to the date of the loan application are also eligible for coverage, for the residual amortisation value and to the extent that additional operating and/or maintenance and/or realisation costs not yet incurred at the date of the loan application exist or are expected.
News([7]) By way of example, hazardous chemicals, cultural heritage, drugs and psychotropic substances, radioactive substances, waste, products containing dog and cat fur, endangered wildlife, ozone depleting substances, products and equipment containing fluorinated greenhouse gases, food and food additives and genetically modified organisms.
News([8]) With reference to such latter aspect, it should be noted that pursuant to Article 5.5 (Remuneration of the SACE Guarantee) of the general terms and conditions governing Garanzia Futuro Light, any amounts indicated by SACE prior to the issuance of each guarantee, including through computer applications and/or online platforms, amount to estimates of the potentially applicable remuneration and are merely preliminary and informative in nature. Such amounts may, therefore, vary depending on the outcome of the preliminary investigation necessary for the granting of Garanzia Futuro Light and, moreover: (i) are provided without prejudice to the possibility to reject the transaction in the event of a negative outcome of the verifications carried out by SACE, and (ii) do not amount to a contractual proposal or offer, and shall not result in any obligation for SACE to issue any guarantee.
