92/542/EEC: Council Decision of 23 November 1992 providing medium-term financial assistance for Estonia, Latvia and Lithuania

• Articles: 5

Article 1

1. The Community shall grant to Estonia, Latvia and Lithuania medium-term loan facilities of a maximum amount of ECU 40 million, 80 million and 100 million respectively in principal, with a maximum duration of seven years, with a view to ensuring sustainable balance-of-payments situations and strengthening the reserve positions.

2. To this end the Commission is empowered to borrow, on behalf of the Community, the necessary ressources that will be placed at the disposal of Estonia, Latvia and Lithuania in the form of loans.

3. These loans will be managed by the Commission in full consultation with the Monetary Committee and in a manner consistent with any Agreements reached between the IMF and Estonia, Latvia and Lithuania.

Article 2

1. The Commission is empowered to negotiate with the Estonian, Latvian and Lithuanian authorities, after consultation with the Monetary Committee, the economic policy conditions attached to the loan. These conditions shall be consistent with the agreements referred to in Article 1 (3) and with arrangements made by G-24.

2. The Commission shall verify at regular intervals, in collaboration with the Monetary Committee and in close coordination with the G-24 and the IMF, that the economic policies in Estonia, Latvia and Lithuania are in accordance with the objectives of these loans and that their conditions are being fulfilled.

Article 3

1. The loans shall be made available to Estonia, Latvia and Lithuania separately, on a case-by-case basis. Each loan shall be released in two instalments.

2. The first instalment shall be released in each case as soon as a 'stand-by arrangement' has been agreed with the IMF. Subject to Article 2 (2), the second instalment shall be released on the basis of a satisfactory track record in the implementation of this arrangement and not before the second quarter of 1993.

3. The funds shall be paid to the central banks.

Article 4

1. The respective borrowing and lending operations referred to in Article 1 shall be carried out using the same value date and must not involve the Community in the transformation of maturities, in any exchange or interest-rate risk, or in any other commercial risk.

2. The Commission shall take the necessary steps, if Estonia, Latvia or Lithuania so decide, to include in the respective loan conditions, and also to exercise, an early repayment clause.

3. At the request of Estonia, Latvia and Lithuania, and if circumstances permit an improvement in the interest rate on the respective loans, the Commission may refinance all or part of its initial borrowings or restructure the corresponding financial conditions. Refinancing or restructuring operations shall be carried out in accordance with the conditions set out in paragraph 1 and shall not have the effect of extending the average duration of the borrowing concerned or increasing the amount, expressed at the current exchange rate, of capital outstanding at the date of these operations.

4. All related costs incurred by the Community in concluding and carrying out the operation under this Decision shall be borne by Estonia, Latvia and Lithuania as appropriate.

5. The Monetary Committee shall be kept informed of developments in the operations referred to in paragraphs 2 and 3.

Article 5

At least once a year the Commission shall send to the European Parliament and to the Council a report, which will include an assessment on the implementation of this Decision. Done at Brussels, 23 November 1992. For the Council

The President

N. LAMONT

(1) OJ No C 266, 15. 10. 1992, p. 8. (2) Opinion delivered on 30 October 1992 (not yet published in the Official Journal).