Credit Guarantee (Amendment) Act 2016

Power of Minister to give counter guarantees

11. (1) Subject to this section and section 12 , the Minister may, in accordance with a counter guarantee scheme, enter into an agreement (in this Part referred to as a “counter guarantee agreement”) with a promotional financial institution guaranteeing the due repayment to that institution of such part, as is specified in the counter guarantee agreement, of moneys (excluding any interest and other charges) paid by that institution to finance providers pursuant to qualifying PFI guarantee agreements.

(2) A counter guarantee agreement shall—

(a) have scheduled to it the counter guarantee scheme to which it relates, and

(b) include a declaration, by the promotional financial institution entering into the agreement, that it agrees to be bound by the terms of the scheme referred to in paragraph (a) and the other terms (if any) of that agreement.

(3) The Minister shall not, pursuant to a counter guarantee agreement, be liable, in relation to any particular qualifying PFI guarantee agreement, to pay to the participating PFI an amount exceeding the Minister’s maximum liability, referred to in subsection (4)(e) of section 13 and as specified in the counter guarantee scheme scheduled to that counter guarantee agreement, in respect of moneys—

(a) for the time being standing unpaid to the finance provider under any finance agreement, and

(b) that the participating PFI has paid to the finance provider, pursuant to that qualifying PFI guarantee agreement, in respect of those moneys standing so unpaid.

(4) For the purposes of this Part, the Strategic Banking Corporation of Ireland, in its capacity as a promotional financial institution, has the power to give guarantees to finance providers in respect of finance agreements.

(5) (a) The Minister may, in respect of a counter guarantee agreement, notify the participating PFI in writing that that agreement shall not apply in relation to qualifying PFI guarantee agreements (in this section referred to as “new qualifying guarantee agreements”) entered into by the participating PFI after such date as may be specified in the notice.

(b) A counter guarantee agreement the subject of a notice under paragraph (a) shall not apply to new qualifying PFI guarantee agreements.