Export-Import Bank Reauthorization: Comparison of H.R. 5068 and S. 3938

Export-Import Bank Reauthorization: Comparison of H.R. 5068 and S. 3938

Order Code RL33735
Export-Import Bank Reauthorization:
Comparison of H.R. 5068 and S. 3938
Updated January 24, 2007
James K. Jackson
Specialist in International Trade and Finance
Foreign Affairs, Defense, and Trade Division

Export-Import Bank Reauthorization:
Comparison of H.R. 5068 and S. 3938
Summary
The Export-Import Bank is an independent U.S. government agency that serves
as the chief U.S. government agency to help finance American exports of
manufactured goods. Congress exercises oversight responsibilities over the Bank in
a number of ways, including extending the Bank’s authority through reauthorizing
legislation. The 109th Congress considered H.R. 5068 and S. 3938, both titled the
Export-Import Bank Reauthorization Act of 2006, which would reauthorize the
Bank’s charter for five years through September 30, 2011. The House measure was
introduced by Representative Pryce on March 30, 2006, and was sent to the House
Financial Services Committee, which has jurisdiction in the House of
Representatives over the Bank. The measure was approved with four amendments
by the Committee on June 14, 2006, and passed the full House unanimously without
amendment on July 26, 2006. In the Senate, S. 3938 was introduced September 26,
2006 by Senator Crapo and sent to the Committee on Banking, Housing, and Urban
Affairs, which has jurisdiction. The measure passed the Senate with an amendment
by unanimous consent on September 30, 2006. As of this date, Eximbank’s
appropriations are continuing under P.L. 109-289 (H.R. 5631) as amended by P.L.
109-369 and P.L. 109-383. On December 6, 2006, the House approved S. 3938 in
lieu of H.R. 5068 to reauthorize the Bank’s authority through September 30, 2011.
The measure was signed by Bush on December 20, 2006, and was designated P.L.
109-438.
The two measures amended the Bank’s charter in a number of areas. Both the
House and Senate measures extended the Bank’s authority to September 30, 2011,
and they directed the Bank to organize permanently a Small Business Division. The
measures commit more of the Bank’s resources to promoting and servicing exports
from small business concerns. Both measures reauthorize the Bank’s efforts to
promote trade with sub-Saharan Africa. Both measures also amend, although in very
different ways, the Bank’s current statutes regarding the offering of tied aid credits
to U.S. exporters.
H.R. 5068 would have made the Bank’s operations more transparent and it
would have required the Bank to take other actions and to prepare various reports to
improve the Bank’s relative competitive position. Furthermore, H.R. 5068 would
have authorized an office within the Bank to increase the total amount of loans and
guarantees that go to support exports by “socially and economically disadvantaged
small business concerns and small business concerns owned by women.” The
measure also would have provided for a number of changes to improve the
competitiveness of the Bank’s programs, directed the Bank to study how it can assist
new or impoverished democracies, and provided greater assistance to exports
involving renewable energy. S. 3938 directs the Bank to submit annually to
Congress a list of U.S. commercial sectors and products that would suffer “adverse
economic impact” due to Eximbank support of projects abroad.
This report provides a side-by-side comparison of the two bills. It will be
updated as warranted by events.

Contents
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Overview of H.R. 5068 and S. 3938 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Side-by-Side Comparison of H.R. 5068 and S. 3938 . . . . . . . . . . . . . . . . . . . . . . 4
Extension of Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Small Business Division . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Small Business Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Small Business Exports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Report on Fees Charged to Small and Medium Business . . . . . . . . . . . . . . 13
Office of Financing for Socially and Economically Disadvantaged
Small Business and Small Business Owned by Women . . . . . . . . . . . 14
Sensitive Commercial Sectors and Products . . . . . . . . . . . . . . . . . . . . . . . . 16
Sub-Saharan Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Exports of Nonlethal Defense Articles . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Transparency Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Budgetary Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Competitiveness Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Eximbank’s Efforts to Assist New or Impoverished Democracies . . . . . . . 29
Review of Environmental Screening Requirements . . . . . . . . . . . . . . . . . . 30
Office of Renewable Energy Promotion . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Transparency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Aggregate Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Anti-Circumvention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Performance Standards for Small Businesses . . . . . . . . . . . . . . . . . . . . . . . 36
Tied Aid Credit Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Prohibition on Assistance for Certain Railway Connections . . . . . . . . . . . . 42

Export-Import Bank Reauthorization:
Comparison of H.R. 5068 and S. 3938
Overview
The Export-Import Bank (Eximbank) is an independent U.S. government agency
that serves as the chief U.S. government agency to help finance American exports of
manufactured goods.1 Congress has direct oversight responsibility over the Bank,
which it exercises through various methods including approving the Bank’s charter,
extending its authority through reauthorizing legislation, annual budget
appropriations, Senate confirmation of Presidential appointments to the Bank’s Board
of Directors and the Bank’s President, requests for testimony from the Bank’s
President, and amendments to the Bank’s governing statutes.
Eximbank has three main programs it uses to finance U.S. exports: direct loans,
export credit guarantees, and export credit insurance. Prior to 1980, the Bank’s direct
lending program was its chief financing vehicle, which it used to finance such
capital-intensive exports as commercial aircraft and nuclear power plants. Both the
budget authority requested by the Administration and the limitation approved by the
Congress for the Bank’s direct lending were sharply curtailed during the 1980s and
1990s.
Eximbank’s direct lending program is used primarily to aid U.S. exporters in
instances where they face a foreign competitor that is receiving officially subsidized
financing by a foreign government. These loans carry fixed interest rates and
generally are made at terms that are the most attractive allowed under the provisions
of international agreements. They are made primarily to counter attempts by foreign
governments to sway purchases in favor of their exporters solely on the basis of
subsidized financing, rather than on market conditions (price, quality, etc.), and to
enforce internationally agreed upon terms and conditions for export financing. The
Bank also has an Intermediary Credit Program it uses to offer medium- and long-term
fixed-rate financing to buyers of U.S. exports, but U.S. exporters also must face
officially subsidized foreign competition to qualify for this program.
As part of its direct lending program, the Bank has a tied aid “war chest” it uses
to counter specific projects that are receiving foreign officially subsidized export
financing. Tied aid credits and mixed credits are two of the primary methods
whereby governments provide their exporters with official assistance to promote
exports. Tied aid credits include loans and grants which reduce financing costs
1 For additional information, see CRS Report 98-568, Export-Import Bank: Background and
Legislative Issues, by James K. Jackson, and the Bank’s Internet address:
[http://www.exim.gov].

CRS-2
below market rates for exporters and which are tied to the procurement of goods and
services from the donor country. Mixed credits combine concessional government
financing (funds at below market rates or terms) with commercial or near-
commercial funds to produce an overall rate that is lower than market-based interest
rates and carries more lenient loan terms. The United States does tie substantial
amounts of its agricultural and military aid to U.S. goods, but it generally has avoided
using such financing to promote American capital goods exports.
Guarantees and insurance are the main programs the Bank uses to assist
American exporters. Both programs reduce some of the risks involved in exporting
by insuring against commercial or political uncertainty. There is an important
distinction, however, between the two programs. Insurance coverage carries with it
various conditions that must be met by the insured before the Bank will pay off a
claim. A guarantee is an ironclad commitment made to a commercial bank by the
Export-Import Bank that promises full repayment with few, if any, conditions
attached. In addition, Eximbank has a Working Capital Guarantee Program that it
uses to aid small- and medium-sized businesses. Businesses that qualify have
exporting potential but need working capital funds to produce or market their goods
or services for export. Guarantees are offered to qualified lenders (primarily
commercial banks) in order to facilitate loans to small businesses. In FY2005, the
Bank authorized $13.94 billion in loans and guarantees to support an estimated
$17.86 billion in U.S. exports. According to the Bank, this represents 3,128
transactions of which 80 percent directly benefitted small business.
Overview of H.R. 5068 and S. 3938
The 109th Congress considered H.R. 5068 and S. 3938, both identified as the
Export-Import Bank Reauthorization Act of 2006. H.R. 5068 was introduced in the
House on March 30, 2006, by Representative Pryce and sent to the House Financial
Services Committee, which has jurisdiction in the House of Representatives over the
Bank. The measure was approved with four amendments by the Committee on June
14, 2006 and passed the full House unanimously without amendment on July 26,
2006. On September 21, 2006, the Senate Committee on Banking, Housing, and
Urban Affairs, which has jurisdiction over the Bank, marked up the House bill and
sent the measure to the full Senate on September 26, 2006. S. 3938 was adopted with
amendments by the full Senate on September 30, 2006. Eximbank’s appropriations
are continuing under P.L. 109-289 (H.R. 5631) as amended by P.L. 109-369 and P.L.
109-383. On December 6, 2006, the House approved S. 3938 in lieu of H.R. 5068
to reauthorize the Bank’s authority through September 30, 2011. The measure was
signed by Bush on December 20, 2006, and was designated P.L. 109-438.
Both measures extend the Bank’s charter, which expired on September 30,
2006, to September 30, 2011, and amend the Bank’s charter in various areas. In
some cases, these areas overlap, while in other areas, the two measures reflect
different approaches to issues by Members of the House and the Senate. In broad
terms, the two measures extend the Bank’s authority to September 30, 2011. The
measures also direct the Bank to organize a Small Business Division within the Bank
to increase the Bank’s efforts to assisting small business owners. In addition, both

CRS-3
measures require the Bank to establish a Small Business Committee within the Bank
to coordinate efforts to assist small business.
Both measures extend the authority of the Bank’s Advisory Committee on
Africa to September 30, 2011, to assist U.S. firms exporting to Sub-Saharan Africa.
The measures also extend to September 30, 2011, the Bank’s authority to provide
financing for the export of nonlethal defense articles and services that are meant
primarily for civilian purposes. Both measures increase the transparency of the
Bank’s programs by requiring the Bank to publish notices of any intent to undertake
an economic impact analysis of a project seeking a loan or guarantee from the Bank.
The Bank is also required to seek comments on the proposed project from the
Department of Commerce, the International Trade Commission, the Office of
Management and Budget and the Senate Committee on Banking, Housing, and Urban
Affairs, and the House Committee on Financial Services. The Bank is also required
to publish any subsequent changes to the proposed project in the Federal Register and
provide for a comment period.
Beyond these areas of common approaches, the two measures provide a number
of different areas in which they amend the Bank’s charter. For instance, H.R. 5068
would have authorized an office within the Bank to increase the total amount of loans
and guarantees that go to support exports by “socially and economically
disadvantaged small business concerns and small business concerns owned by
women.” H.R. 5068 also would have attempted to make the Bank’s operations more
transparent by keeping applicants better informed of the status of their application
for a loan or guarantee and it would require the Bank to provide a broad set of reports
to Congress on the Bank’s operations. H.R. 5068 would have required the Bank to
report to Congress annually on its efforts to improve the competitiveness of its
programs relative to the programs of other official export credit agencies. H.R. 5068
would have directed the Bank to study how it might assist new or impoverished
democracies, and provide greater assistance to exports involving renewable energy.
S. 3938 directs the Bank to submit a list of commercial sectors and products that
would suffer “adverse economic impact” due to Eximbank support for certain
projects abroad.
Both measures amend the Bank’s current procedures for operating the Bank’s
tied aid facility. H.R. 5068 would have reduced somewhat the role of the Secretary
of the Treasury in the operation of the tied aid program, while S. 3938 expands the
Secretary’s role by providing a formal procedure that allows the Secretary to oppose
decisions made by the Bank’s Board of Directors to match an offer of tied aid by a
foreign entity. H.R. 5068 would have broadened the current scope of the tied aid
program by authorizing the Bank to use the program to support new measures on tied
aid, enforce existing arrangements, and to bring into the Organization for Economic
Cooperation and Development (OECD) Arrangement on Guidelines for Officially
Supported Export Credits2 those countries that currently are not a party to the
2 The OECD Arrangement on Guidelines for Officially Supported Export Credits is a
voluntary agreement among Australia, Canada, the European Community, Japan, Korea,
New Zealand, Norway, Switzerland and the United States that provides a framework for the
(continued...)

CRS-4
Arrangement. The House measure would have reduced the burden on the Bank for
information about foreign offers of tied aid. Often it is difficult for the Bank to meet
the burden of proof that it has “credible information” about an offer by a foreign
entity of tied aid if the foreign government is not a party to an agreement, such as the
OECD Arrangement and, therefore, is under no requirement to provide information
concerning its offers of tied aid. Instead, the Bank would have been required to have
simply “credible evidence” based on a “history of such offers” in order to meet the
burden of proof.
Side-by-Side Comparison of H.R. 5068 and S. 3938
The following section provides a more detailed comparison of the two bills.
Extension of Authority
Both measures would extend the Bank’s authority to September 30, 2011.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Extension of authority.
Same
Would extend the Bank’s authority to
September 30, 2011.
Small Business Division
Since 1975, Congress has taken an active interest in the way Eximbank supports
small business.3 Congress has emphasized this support by directing that not less than
one of the five members of the Bank’s Board of Directors should be selected from
among the small business community and represent the interests of small businesses.4
Furthermore, Congress has directed the Bank to disseminate information about the
2 (...continued)
use of officially supported export credits. The Arrangement became effective in 1978 and
places limitations on the terms and conditions of officially supported export credits and the
provision of tied aid. It includes procedures for prior notification, consultation, information
exchange and review for export credit offers and offers of tied aid.
3 See also CRS Report RS22091, Export-Import Bank: Legislative Mandate for Small
Business, by James K. Jackson.
4 12 U.S.C. 635a (c)(8)(B); provision was first added in P.L. 93-646, Export-Import Bank
Amendments of 1974.

CRS-5
Bank’s medium-term financing program to small business concerns,5 and it has
directed that the terms and conditions it offers to support U.S. firms, including small
business, should be fully competitive with terms set by other countries.6
In 1983, through P.L. 98-181, Congress provided additional support for small
business by directing that three of the Bank’s Advisory Committee represent the
small business community.7 Congress also expanded on a previous directive to the
Bank to “aid, counsel, assist, and protect” the interests of small business, and directed
the Bank to: (1) encourage small business;8 (2) give fair consideration to small
business;9 (3) aid, counsel, assist, and protect small business concerns;10 (4) designate
an officer of the Bank responsible for small business concerns;11 (5) ensure that 6%
of the Bank’s authority is available to small business concerns;12 (6) offer
competitive financing terms;13 (7) provide lines of credit or guarantees to consortia
of small or medium size banks, export trading companies, State export finance
agencies, export financing cooperatives, small business investment companies, or
other financing institutions or entities in order to finance small business exports;14 (8)
promote small business exports and small business export financing programs;15 (9)
urge the Foreign Credit Insurance Association to provide coverage against 100% of
any loss for exports valued at less than $100,000;16 (10) inform high technology small
business concerns about exporting to countries in transition to market based
economies;17 and (11) provide information to small and rural companies.18
In 2002, through P.L. 107-189, Congress directed the Bank to give particular
attention to certain types of small business concerns and directed the Bank to set
aside not less than 20% of its aggregate authority for small business. Congress also
directed the Bank to conduct “outreach and increase loans to socially and
5 12 U.S.C. Sec 635 (a)(2)(B)
6 12 U.S.C. Sec 635 (b)(1)(B)
7 12 U.S.C. 635a (d)(2)(A)
8 12 U.S.C. Sec 635 (b)(1)(E)(i)(I)
9 12 U.S.C. Sec 635 (b)(1)(E)(i)(II)
10 12 U.S.C. Sec 635 (b)(1)(E)(ii)
11 12 U.S.C. Sec 635 (b)(1)(E)(iii)(I)
12 12 U.S.C. Sec 635 (b)(1)(E)(iv) and (v); P.L. 98-181 provided for a graduated increase
from 6% in 1984 to 10% in 1986. Amended by P.L. 102-429, Export Enhancement Act of
1992, which set the share at not less than 10%. P.L. 107-189, the Export-Import Bank
Reauthorization Act of 2002, raised the share to not less than 20%.
13 12 U.S.C. Sec 635 (b)(1)(E)(vi)
14 12 U.S.C. Sec 635 (b)(1)(E)(vii)(I)
15 12 U.S.C. Sec 635 (b)(1)(E)(viii)
16 12 U.S.C. Sec 635 (b)(1)(F)
17 12 U.S.C. Sec 635 (b)(1)(H)(iii)
18 12 U.S.C. Sec 635 (b)(1)(I)

CRS-6
economically disadvantaged small business concerns, small business concerns owned
by women, and small business concerns employing fewer than 100 employees, and
for maintaining liaison with the Small Business Administration and other
departments and agencies in matters affecting small business concerns.”19 Congress
also required the Bank to submit an annual report detailing its efforts to involve small
businesses.20
H.R. 5068 and S. 3938 provide additional support to small business by directing
the Bank to establish a Small Business Division and it would amend various sections
of the current statute governing the operations of the Bank. In particular, the
measures remove section (iii) of 12 U.S.C. 635(b)(1)(E) that requires the Board of
Directors of the Bank to designate an officer of the Bank who is responsible to the
President of the Bank for all matters concerning “small business concerns.” In its
place, the measures direct the Bank to establish a Small Business Division whose
sole function would be to carry out such activities as outreach to small business,
including feedback, product improvement, transaction advocacy; advise and seek
feedback from small business; and maintain liaison with the Small Business
Administration. H.R. 5068 would have required the Bank officer designated to
administer the Small Business Division to have “substantial experience” in financing
exports by small business; have had the sole duty of ensuring that the division carried
out its functions for small business; advised the Board of Directors, and particularly
the Director on the Board who is responsible for small business; rank no lower than
a Senior Vice President;21 and that the officer report directly to the President of the
Bank. S. 3938 requires that the Bank officer managing the Small Business division
appointed by the president of the Bank instead of by the Board of Directors.
To offer additional support to the Small Business Division, both measures
require the President of the Bank to ensure that the staff and budgetary resources of
the Division be devoted solely to carrying out the functions of the Small Business
Division. In addition, the staff of the Division are required to be dedicated
“exclusively” for performing outreach, training, and providing advice to, seeking
feedback from, and advocating on behalf of small business concerns “regarding Bank
financing opportunities, products, and programs.” The House measure would have
granted the staff of the Small Business Division the authority to approve working
capital loans and guarantees of up to $10 million; the Senate measure leaves such
policy decisions to the Board of Directors of the Bank.
In H.R. 5068, the Bank, during the course of handling and processing
applications of small business for programs of the Export-Import Bank, would have
been required to obtain the same kind of “reasonable assurance of repayment for each
transaction” that the Bank is required to receive under current statute. The Bank,
however, would have been required to establish and maintain “transaction standards
tailored to the special circumstances of small business concerns” and then use the
19 12 U.S.C. Sec 635 (b)(1)(E)(iii)(II)
20 12 U.S.C. Sec. 635g(b)(1) - (3), (c), (d)
21 The current Bank officer who is responsible for administering the Bank’s small business
programs is a Senior Vice President.

CRS-7
standards to evaluate applications by small business concerns. The Bank would also
have been required to ensure that “each appropriate division” of the Bank has staff
dedicated to the processing of transactions involving small business concerns.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Small Business Division.
Same.
The measure would establish a Small
Business Division within the Bank.
Functions of the Small Business
Same.
Division.
Would require the Small Business Division
to carry out outreach, feedback, product
improvement, and transaction advocacy for
small business concerns.
Would require the division to advise and
seek feedback from small business on the
financing products of the Bank, in
particular: conducting outreach, tailoring
products to small business needs, and
increasing loans to small business concerns
employing fewer than 100 employees.
Would require the division to maintain
liaison with the Small Business
Administration and other departments and
agencies in matters affecting small
business concerns.
No comparable provision.
Provide oversight of the development,
implementation, and operation of
technology improvements to strengthen
small business outreach.
Management.
Management.
Small Business Division would be
Bank officer would be appointed by the
managed by a Bank officer designated by
President of the Bank.
the Board of Directors.
Bank officer to rank no lower than Senior
Same.
Vice President.
Bank officer would be required to have
Sole function would be to manage the
substantial recent experience in financing
Small Business Division.
exports by small business concerns.

CRS-8
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Would ensure that the division carried out
No comparable provision.
the functions of the division; would serve
as the chairman of the Small Business
Committee.
Would advise the Board of Directors and
No comparable provision.
would represent the interests of small
business.
Would report directly to the President of
No comparable provision.
the Bank.
Staff.
Staff.
Each operating division of the Bank would
Same.
have staff that specializes in transactions in
support of exports by small business
concerns.
Staff would be involved in all aspects of
Same.
processing (including approval or
disapproval, or staff recommendation of
approval or disapproval, as appropriate)
applications for loans, guarantees, and
insurance.
May approve applications for working
May approve applications for working
capital loans and guarantees, and for
capital loans and guarantees, and insurance
insurance, in support of exports which
in accordance with policies and procedures
have a value of less than $10,000,000.
established by the Board.
No comparable provision.
Small business specialists would consider
the unique business requirements of small
businesses and develop exporter
performance criteria tailored to small
business exporters.
No comparable provision.
Small business specialists would be
identified on the Bank’s website and in
promotional material.
No comparable provision.
Small business specialists would be
evaluated on their performance of duties
related to transactions in support of small
business concerns.
No comparable provision.
Staff recommendations of denial or
withdrawal for medium-term applications,
exporter held multi-buyer policies, single
buyer policies, and working capital
applications processed by the Bank would

CRS-9
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
be required to be transmitted to the Senior
Vice President of the Division not later
than 2 business days before a final
decision.
Resources.
No comparable provision.
The President of the Bank would ensure
that the Small Business Division had
sufficient qualified staff and budgetary
resources to carry out the provisions of
this section, after consultation with Bank
officers and the House Committee on
Financial Services; and the Senate
Committee on Banking, Housing, and
Urban Affairs.
The President of the Bank would ensure
that the staff and budgetary resources of
the division would be devoted solely to
carrying out the functions of the division.
The Small Business Division would
include staff dedicated exclusively to
providing outreach, training, and advice to,
seeking feedback from, and advocating on
behalf of small business concerns
regarding Bank financing opportunities,
products, and programs.
Processing of Transactions.
No comparable provision.
Consistent with the requirement that the
Bank obtain a reasonable assurance of
repayment for each transaction the Bank
supports, the Bank would be required to
establish and maintain transaction
standards tailored to the special
circumstances of small business concerns
and would use the standards in evaluating
applications by the concerns for Bank
financing. The Bank would ensure that
each appropriate division of the Bank has
staff dedicated to the processing of
transactions involving small business
concerns.

CRS-10
Small Business Committee
Both measures require the Bank to establish and maintain a Small Business
Committee that will focus on small business concerns and coordinate the efforts of
the Bank with respect to small business concerns. The chairman of the Committee
is the Senior Vice President of the Bank who is responsible for administering the
Small Business Division. The Committee includes officers and employees from
throughout the Bank who have responsibilities that involve small business. S. 3938
assigns a number of specific duties to the Small Business Committee, including
developing the Bank’s small business strategic plans and monitoring the Bank’s
progress in achieving the goals of the plan; evaluating the performance of each
division within the Bank regarding small business; establishing criteria for evaluating
the performance of staff; and coordinating with other government agencies providing
services to small business. The Senate measure also gives the Chairperson of the
Small Business Committee certain authority and grants the President of the Bank the
authority to determine the composition of the Committee. Both measures require the
Committee to prepare a report for the President of the Bank.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Small Business Committee.
Same.
Would establish a Small Business
Committee.
Purpose.
Same.
The purpose of the Committee would be to
focus on small business concerns and
coordinate the efforts of the Bank,
including the timely processing of
transactions and the evolution of new or
improved Bank products.
No comparable provision.
Duties.
The Committee would assist in developing
the Bank’s small business strategic plans,
including plans for improving the share of
the Bank’s business comprised of small
business and improving technology to
assist small business outreach. The
Committee would also assist in measuring
and reporting in writing to the President of
the Bank, at least once a year, on the
Bank’s progress in achieving the goals.
The Committee would evaluate and report
in writing to the President of the Bank, at
least once a year, with respect to: 1) the

CRS-11
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
performance of each operating division of
the Bank in serving small business
concerns; 2) the impact of processing and
underwriting standards on transactions
involving direct exports by small business
concerns; and 3) the adequacy of the
staffing and resources of the Small
Business Division.
The Committee would establish criteria for
evaluating the performance of staff.
The Committee would coordinate with
other United States Government
departments and agencies the provision of
services to small business concerns.
Composition of the Small Business
Same.
Committee.
Chairman.
The chairman of the Small Business
Committee would be the Senior Vice
President of the Bank responsible for the
Small Business Division.
No comparable provision.
Authority.
The Chairperson would have the authority
to call meetings of the Small Business
Committee, set the agenda, and request
policy recommendations from the
Committee’s members.
Other members.
Other members.
Other members of the Committee would
The President of the Bank would determine
include staff of the Small Business
the composition of the Small Business
Committee, and other officers and
Committee; The President of the Bank
employees involved in outreach and
would appoint or remove members;
processing transactions involving small
including: 1) the senior managing officers
business concerns as indicated by the
responsible for underwriting and
President of the Bank.
processing transactions; and 2) other
officers and employees of the Bank with
responsibility for outreach to small
business concerns and underwriting and
processing transactions that involve small
business concerns.

CRS-12
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Reports.
Reports.
The Small Business Committee would
Same.
report to the President of the Bank.
Staff evaluations.
No comparable provision.
Staff of the Committee would be evaluated
on the basis of their performance related to
transactions in support of exports by small
business concerns.
Small Business Exports
Currently, the Bank is required to provide lines of credit or guarantees to
consortia of small or medium size banks, export trading companies, State export
finance agencies, financing cooperatives, small business investment companies to
finance small business exports. H.R. 5068 would have required the Bank to work in
cooperation with the aforementioned entities to streamline the processing of
applications for Bank financing and to provide training and advice on “the needs and
benefits of export financing for small business concerns.”
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Small business exports.
No comparable provision.
The Bank would be required to work with
consortia of small and medium size banks,
export trading companies, State export
finance agencies, financing cooperatives,
small business investment companies to
streamline the processing of applications
for Bank financing from small business
concerns and to provide training and
advice as required on the needs and
benefits of export financing for small
business concerns.

CRS-13
Report on Fees Charged to Small and Medium Business
H.R. 5068 would have required the Bank to report annually to Congress on the
fees it charges and the transactions costs it incurs through its activities with small and
medium business. In particular, the Bank would have been required to report on
three activities. The first area is the interest and fees the Bank charges exporters,
including small business concerns, for each type of Bank transaction (insurance,
guarantee, direct financing) and each financing program for small business concerns,
buyers, and other applicants, and the highest, lowest, and average fees charged by the
Bank for short term insurance transactions. The second area of reporting is on the
effects of the fees on the ability of the Bank to achieve the objectives of the Bank
relating to small business. The third area is the fee structure of the Bank compared
with that of other foreign export credit agencies.
H.R. 5068 also would have required the Bank to report annually to the Congress
on the following three activities:
1) The extent to which the Bank is able to use its authority to: develop a program
which gives “fair consideration to making loans and providing guarantees for the
export of goods and services” by small business; and to “ aid, counsel, assist, and
protect, insofar as is possible, the interests of small business concerns in order
to preserve free competitive enterprise.” The Bank would also report on the
extent to which the Bank would have been unable to utilize fully these authorities
and to report on the obstacles that prevent the Bank from utilizing these
authorities and on what actions the bank is taking to overcome any obstacles.
2) The extent to which financing is made available to small business concerns to
enable them to participate in exports by major contractors, including across the
supply chain of the contractors through direct or indirect financing.
3) A strategic plan of action describing what specific measures the Bank would
take to achieve the small business objectives of the Bank, including expanded
outreach, product improvements, and related actions.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Report on fees charged to small and
No comparable provision.
medium business.
The Bank would be required to provide
annual reports to Congress to include:
1) Each type of transaction, the interest and
fees charged by the Bank to exporters
(including a description of fees and
interest, if any, charged to small business
concerns), buyers, and other applicants in
connection with each financing program of
the Bank, and the highest, lowest, and

CRS-14
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
average fees charged by the Bank for short
term insurance transactions.
2) The effects of the fees on the ability of
the Bank to achieve the objectives of the
Bank relating to small business.
3) The fee structure of the Bank as
compared with that of other foreign export
credit agencies.
Annual report on financing directed
No comparable provision.
toward small business.
1) The extent to which the Bank has been
able to use its authority, and, to the extent
the Bank has been unable to fully do so, a
report on the obstacles to doing so and on
what the Bank is doing to overcome the
obstacles.
2) The extent to which financing has been
made available to small business concerns
to enable them to participate in exports by
major contractor, including through access
to the supply chains of the contractors
through direct or indirect funding; and
3) A strategic plan of action describing
how, in the upcoming year, the Bank will
take specific measures to achieve the small
business objectives of the Bank, including
expanded outreach, product improvements,
and related actions.
Office of Financing for Socially and Economically
Disadvantaged Small Business and Small Business Owned
by Women
H.R. 5068 would have required the President of the Bank to establish within the
Small Business Division an office that would have been responsible for increasing
the total amount of loans, guarantees, and insurance provided by the Bank to support
exports by “socially and economically disadvantaged small business concerns and
small business concerns owned by women.” The bill would have required the Bank
to have a goal of having not less than 10 percent of the amount available for
financing exports available to small business concerns and to report annually on the
efforts the Bank was taking to reach the goal.

CRS-15
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Office of financing for socially and
No comparable provision.
economically disadvantaged small
business concerns and small business
concerns owned by women.
The President of the Bank would be
required to establish an office whose sole
functions would be to continue and
enhance the outreach activities of the Bank
with respect to, and increase the total
amount of loans, guarantees, and insurance
provided by the Bank to support exports
b y, soci a l l y a n d e c o n o mi c a l l y
disadvantaged small business concerns and
small business concerns owned by women.
The office would be managed by a Bank
officer who would report to the Small
Business Division.
To the maximum extent practicable, the
President of the Bank would ensure that
qualified minority and women applicants
are considered when filling any position in
the office.
The Bank would strive to make available
not less than 15 percent of the amount to
finance exports directly by small business
concerns.
The Bank would report annually on its
efforts to finance exports by small business
concerns.
The Bank would report annually on its
efforts to support exports by small and
medium-sized businesses owned by women
and minorities to the House Committee on
Financial Services and the Senate
Committee on Banking, Housing, and
Urban Affairs, and the Bank would include
a written report that describes the progress
made by the Bank in supporting exports by
socially and economically disadvantaged
small business concerns and small business
concerns owned by women.

CRS-16
Sensitive Commercial Sectors and Products
S. 3938 requires the President of the Bank to prepare annually a list for specified
House and Senate Committees on “sensitive” commercial sectors and products in
which offers of financial support for exports would be “unlikely,” because the Bank
had determined that such offers could have an adverse economic impact on U.S.
exports in those sectors.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
No comparable provision.
Sensitive commercial sectors and
products.
The Bank would be required to submit a
list to the Senate Committee on Banking,
Housing, and Urban Affairs and the House
Committee on Financial Services, of
sensitive commercial sectors and products
for which financing support by the Bank is
deemed unlikely by the President of the
Bank due to the significant potential that
such support would result in an adverse
economic impact on the United States. The
President of the Bank would review
annually the list of sensitive commercial
sectors and products and the Bank would
submit an updated list to the respective
committees in Congress.
Sub-Saharan Africa
On the issue of Sub-Saharan Africa, the House and Senate measures are similar
only in that they both would have extended the authority of the Advisory Committee
on Africa to 2011. H.R. 5068 would have required the Bank to do more to work with
financial institutions in sub-Saharan Africa to improve the ability of financial
institutions in Africa to utilize the Bank’s programs. The Bank also would have
been required to improve its working relationship with African financial institutions
by having in place one year after this measure become law a contract between each
approved lender in Africa and the Bank which have specified the Bank’s guarantee
undertakings and related obligation between the Bank and the African lender.
In addition, H.R. 5068 would have required the Bank to report annually on the
efforts of the Bank to improve its working relationship with the African Development
Bank, the Africa Export-Import Bank, and other institutions in the region. The Bank
would have been required to coordinate closely with the U.S. Foreign Commercial
Service and with the overall strategy of the U.S. Government on economic
engagement in Africa relative to the African Growth and Opportunity Act. The Bank
also would have been required to coordinate with the African Development Bank, the

CRS-17
Africa Export-Import Bank, and other financial institutions to seek greater flexibility
in the due-diligence procedures of the Bank in order to qualify a greater number of
appropriate African entities for participation in the programs of the Bank and to
develop policies that would have allowed the Bank to finance certain African
programs in local currencies.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Sub-Saharan Africa.
Sub-Saharan Africa.
The measure would extend the authority of
Same.
the Advisory Committee on Africa to 2011.
The Bank would seek within one year to
No comparable provision.
have in effect a contract with each
approved lender in Africa, which sets forth
the Bank’s guarantee undertakings and
related obligations.
The Bank would include in its annual
No comparable provision.
report to the Congress a section on the
efforts of the Bank to improve working
r e l a t i o n s h i p s w i t h t h e Af r i c a n
Development Bank, the Africa
Export-Import Bank, and other institutions
in the region.
The Bank would closely coordinate with
No comparable provision.
the United States Foreign Commercial
Service and with the overall strategy of the
United States Government, for economic
engagement with Africa pursuant to the
African Growth and Opportunity Act.
The Bank would develop initiatives to train
No comparable provision.
Foreign Service and Commercial Service
officers serving at United State embassies
in Africa, in the use of Bank programs, so
the officers can encourage African buyers
to take part in transactions supported by
the Bank.
Consistent with the requirement that the
No comparable provision.
Bank obtain a reasonable assurance of
repayment in connection with each
transaction the Bank supports, the Bank
would seek greater flexibility in the
due-diligence procedures of the Bank to
qualify a greater number of appropriate
African entities for participation in
programs of the Bank.

CRS-18
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
The Bank would develop procedures under
No comparable provision.
which the Bank is capable of financing
certain African programs in local
currencies.
Exports of Nonlethal Defense Articles
H.R. 5068 and S. 3938 extend to September 30, 2011, the Bank’s existing
authority to provide financing for the export of nonlethal defense articles or services
that are meant primarily for civilian purposes (such as drug eradication and
interdiction).
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Authority to provide financing for the
Same.
export of nonlethal defense articles or
services primarily for civilian purposes.
The Bank’s authority for financing such
exports would be extended to September
30, 2011.
Transparency Initiatives
H.R. 5068 included a large section dealing with transparency initiatives, or
measures to make the operations of the Bank more accessible to businesses and to
increase reporting requirements on the Bank. The Bank’s Board of Directors would
have been required to meet at least twice a week and the Board would have been
required to vote within 60 days of completing an economic impact analysis whether
or not to proceed with a proposed loan or guarantee. The Bank also would have been
required to establish a clearly defined process for handling applications. These
measures would have:
1) acknowledged that the Bank has received an application for one of the Bank’s
programs;
2) informed applicants of the adequacy of the material provided and indicate any
changes that might be made to make the application eligible for consideration;
and
3) kept applicants informed of the status of the application and the reason for any
disapproval.

CRS-19
H.R. 5068 would have required the Bank to notify applicants within 45 days of
applying for a Bank program of the status of the application. In addition, the Bank
would have been required to establish and maintain a website through which any
Bank product could be applied for and which would include information concerning
the Small Business Division of the Bank and any incentives, targets, or goals relating
to small business concerns.
H.R. 5068 also would have required the Bank to report to Congress within 60
days after enactment of the Act on two major areas:
1) the Bank’s efforts to provide medium-term risk protection coverage through
creditworthy trade associations, export trading companies, State export finance
companies, export finance cooperatives, and other multiple-exporter
organization; and
2) the Bank’s progress in implementing an electronic system designed to track
all pending transactions of the Bank.
In those instances in which the Bank had been unable to comply with these two
requirements, H.R. 5068 would have required the Bank to provide an analysis of the
reasons why it had not been able to comply, what the Bank was doing to achieve
compliance and the date by which the Bank would expect to achieve compliance, and
the name of each Bank officer who would be responsible for ensuring that the Bank
achieved compliance and the name of the supervisor of such officers.
Subsequent to the initial report, H.R. 5068 would have required the Bank to
report annually on the Bank’s efforts to carry out the two requirements listed in the
preceding paragraph. The report would have included the total amount the Bank
expended during the fiscal year to carry out the requirements, and how the Bank’s
efforts were assisting small business concerns. In those instances in which the Bank
had not been able to comply it would have been required to provide an analysis of the
reasons why it had not complied, a description of what the Bank was doing to
achieve compliance, the date by which it expected to be in compliance, and the name
of each Bank officer who is responsible for ensuring that the Bank is in compliance
and the name of the supervisor of the Bank officer. The Inspector General of the
Export-Import Bank would have been required to file a report similar to the initial
report that would be required under this section.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Transparency initiatives.
No comparable provision.
The Board of Directors would be required
to meet not less frequently than biweekly.
At the request of any two Board members,
the Chairman would place an item on the
agenda for consideration by the Board.

CRS-20
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Within 30 days after the date of the
request, the Chairman would hold a Board
meeting at which the item would be
considered.
Within 60 days after completing a
economic impact analysis of a proposed
loan or guarantee, the Board of Directors
would be required to vote to determine
whether or not to proceed with the
proposed loan or guarantee, unless the
applicant withdraws the application.
Process for Notifying Applicants of
No comparable provision.
Application Status:
The Bank would be required to establish
and adhere to a clearly defined process for:
1) acknowledging receipt of applications;
2) informing applicants that their
applications are complete or, if incomplete
or containing a minor defect, of the
additional material or changes that, if
supplied or made, would make the
application eligible for consideration; and
3) keeping applicants informed of the
status of their applications, including a
clear and timely notification of approval or
disapproval, and, in the case of
disapproval, the reason for disapproval, as
appropriate.
Response to Application for Financing;
No comparable provision.
Implementation of Online Loan Request
and Tracking Process.
Within 5 days after receipt of an
application for financing, the Bank will
notify the applicant that the application has
been received, and will include:
a) any request for additional information to
complete the application,
b) the name of a Bank employee who may
be contacted with questions relating to the
application,
c) and a unique identification number
which may be used to review the status of
the application at a website established as

CRS-21
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
provided in the next sentence.
Not later than September 1, 2006, the Bank
would be required to establish, and
maintain, a website through which any
Bank product may be applied for,
information may be obtained about the
status of any such application, about the
small business division of the Bank, or
about incentives, preferences, targets, and
goals relating to small business concerns or
small business concerns exporting to
Africa.
Reports Relating to Technology to Assist
No comparable provision.
Small Businesses.
Initial report.
Within 60 days of the enactment of this
Act, the President of the Bank would be
required to submit to the House Committee
on Financial Services and the Senate
Committee on Banking, Housing, and
Urban Affairs a report on:
1) The efforts made by the Bank to carry
out subparagraphs (E)(ix) and (J) of
section 2(b)(1) of the Export-Import Bank
Act of 1945, including the total amount
expended by the Bank to do so (Note: the
sections establish as a matter of policy
efforts to encourage small business to
participate in international trade and to
establish an electronic tracking system
for all applications to the Bank.); and
2) If the Bank has been unable to comply
with these activities, it would be required
to provide:
a) an analysis of the reasons;
b) what the Bank is doing to achieve these
objectives, and the date by which the
Banks expects to have achieved,
compliance; and
c) the name of each Bank officer who is
responsible for ensuring that the Bank
achieves, and the name of the person to
whom the Bank officer reports on progress

CRS-22
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
in achieving, such compliance.
Subsequent reports.
No comparable provision.
The Bank would include in its annual
report for each of fiscal years 2007 through
2011 a separate section that contains:
1) A report on the efforts made by the
Bank to carry out subparagraphs (E)(ix)
and (J) of section 2(b)(1) of this Act (Note:
refers to efforts to encourage small
business to participate in international
trade and development of on-line
resources for applications for the Bank’s
programs.), the total amount expended in
the fiscal year to do so, and how the efforts
are assisting small business concerns; and
2) if the Bank had been unable to comply
fully with the above requirements:
a) an analysis of the reasons why it had
been unable to comply;
b) a description of what the Bank was
doing to achieve, and the date by which the
Banks expected to have achieved, such full
compliance; and
c) the name of each Bank officer who
would be responsible for ensuring that the
Bank achieved, and the name of the person
to whom the Bank officer reported on
progress in achieving, such full
compliance.
Report by the Inspector General of the
No comparable provision.
Bank.
Within 120 days after the date of the
enactment of this Act or, if later, within 30
days after the date the vacancy in the
position of the Inspector General of the
Export-Import Bank of the United States is
filled, the Inspector General of the
Export-Import Bank of the United States
would be required to submit to the House
Committee on Financial Services and the
Senate Committee on Banking, Housing,
and Urban Affairs of the Senate:

CRS-23
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
1) a report on the efforts made by the
Bank to assist small business, the total
amount expended to do so, and how the
efforts assist small business concerns (as
defined under section 3(a) of the Small
Business Act); and
2) if the Bank had been unable to comply
with these requirements:
(a) an analysis of the reasons;
(b) a description of what the Bank was
doing to achieve the requirements, and the
date by which the Banks expected to have
achieved, such compliance; and
(c) the name of each Bank officer who
would responsible for ensuring that the
Bank achieved, and the name of the person
to whom the Bank officer reported on
progress in achieving, such compliance.
Public Disclosure of Certain Documents.
No comparable provision.
Procedures for disclosure of documents
would provide for the public disclosure of
e n vi r o n m e n t a l a s s e s s me n t s a n d
supplemental environmental reports
required to be submitted to the Bank,
including remediation or mitigation plans
and procedures, and related monitoring
reports. These procedures would not be
interpreted to require the public disclosure
of any information described in section
1905 of title 18, United States Code.
Budgetary Effects
H.R. 5068 would have required the Bank to report to Congress on the impact
of the Bank’s programs on the Federal Government’s budget over the preceding ten
years.

CRS-24
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Budgetary effects of the Bank.
No comparable provision.
Within 90 days of enactment of this Act,
the Bank would submit to the appropriate
committees of the Congress a report on the
revenues, expenditures, and resulting
annual net income or expense to the United
States for each of the 10 years most
recently completed before the date of the
report.
Competitiveness Initiatives
H.R. 5068 also included a large section on “competitiveness initiatives” that is
not present in S. 3938. The House measure would have required the Bank to report
more extensively on its efforts to improve the competitiveness of its programs. The
measure would have made a number of changes to the Bank’s tied aid program that
might have lessened the influence of the Secretary of the Treasury on the tied aid
program and have broadened the scope of the Bank’s tied aid program.
The Bank would have been required to report annually to Congress on the
Bank’s efforts to be competitive with other foreign official export credit agencies in
two major areas. First, the Bank would have been required to report on its mandate
to “provide guarantees, insurance, and extensions of credit at rates and on terms and
other conditions which are fully competitive with the Government-supported rates
and terms and other conditions available for the financing of exports of goods and
services from the principal countries whose exporters compete with United States
exporters.” Second, the Bank would have been required to report on its efforts to
work in “cooperation with the export financing instrumentalities of other
governments” and to “seek to minimize competition in government-supported export
financing and shall, in cooperation with other appropriate United States Government
agencies, seek to reach international agreements to reduce government subsidized
export financing.”

In addition to reporting on the actions the Bank has taken to comply with the
two aforementioned requirements, the Bank would have been required to include a
survey of all major export-financing facilities available from other governments and
government-related agencies through which foreign exporters compete with United
States exporters. The Bank would have been required to report in specific terms on
the ways in which the Bank’s rates, terms, and other conditions compare with those
offered directly or indirectly by other governments. The Bank also would have been
required to include a survey of U.S. exporters and U.S. commercial lending
institutions that provide export credits to determine the experience of the exporters
and institutions in meeting financial competition from other countries whose
exporters compete with U.S. exporters.

CRS-25
The Bank also would have been required to report on:
1) The role of the Bank in implementing the strategic plan prepared by the Trade
Promotion Coordinating Committee.
2) The tied aid credit program of the Bank, including a description of the
implementation of the OECD Arrangement on Guidelines for Officially
Supported Export Credits, all principal offers of tied aid financing by foreign
countries, offers grandfathered under the Arrangement, notifications of
exceptions, any use by the Bank of tied aid funds, and other actions by the U.S.
Government to combat predatory financing practices by foreign governments.
3) A description of all Bank transactions classified according to their principle
purpose.
4) Efforts of the Bank to promote exports of goods and services that are related
to sources of renewable energy.
5) The size of the Bank’s program account compared with that of other major
export-financing facilities of foreign governments. The bank would also be
required to offer recommendations relative to the size of the Bank’s program
account, including an assessment of the merits of the size of the accounts and the
impact on the “best interests” of the U.S. taxpayer.
6) The co-financing programs of other major export-financing facilities and
include a list of which countries have a memorandum with the United States
relating to export credit agency co-financing and an explanation of why such a
memorandum is not in effect with other countries.
7) The Bank’s participation in providing funding, guarantees, or insurance for
after-market services, including information on the involvement of other major
export-financing facilities in providing such support and an explanation of any
differences among the facilities in providing this support.
8) Detailed information on cases of export financing that are not in compliance
with the OECD Arrangement on Guidelines for Officially Supported Export
Credits, or that exploit loopholes in the Arrangement for the purpose of obtaining
a competitive commercial advantage.
9) A description of the extent to which the activities of foreign export credit
agencies are not in compliance with the OECD Arrangement and the WTO
Agreement on Subsidies and Countervailing Measures.
The Bank would have been required to have the Board of Directors approve and
sign each report required by the section of H.R. 5068 and the reports would have
been required to include dissenting views. The Bank also would have been required
to include in its annual report to Congress information on and analysis of regional
multi-buyer insurance programs and working capital guarantee programs operated by
the Bank and the effectiveness of the programs overall and the effectiveness of the
programs in increasing export-related jobs in the United States. In addition, the Bank
would be required to report on the size of similar programs of other major export-
financing facilities available from other governments and a detailed explanation of
the working relationship between the Bank and the Small Business Administration,

CRS-26
the Department of Commerce, and other U.S. Government agencies that are
concerned with increasing the number of export-related jobs in the United States.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
Competitiveness initiatives.
No comparable provision.
Annual competitiveness report.
No comparable provision.
Not later than June 30 of each year, the
Bank would submit to the appropriate
committees of the Congress a report that
includes the following:
1) A description of the actions the Bank
had taken to provide financing on a
competitive basis and to minimize
competition in officially-supported export
financing. The report would also include a
survey of all other major export-financing
facilities available from other governments
and government-related agencies through
which foreign exporters compete with
United States exporters (including through
use of market windows (as defined in
section 10(h)(7)) and indicate in specific
terms the ways in which the Bank’s rates,
terms, and other conditions compare with
those offered from such other governments
directly or indirectly.
The Bank would use all available
information to estimate the annual amount
of export financing available from other
f o r e i g n g o v e r n m e n t a n d
government-related agencies.
The report would include a survey of a
representative number of United States
exporters and United States commercial
lending institutions which provide export
credit to determine the experience of the
exporters and institutions in meeting
financial competition from other countries
whose exporters compete with United
States exporters.
2) A description of the role of the Bank in
implementing the strategic plan prepared
by the Trade Promotion Coordinating
Committee in accordance with section
2312 of the Export Enhancement Act of

CRS-27
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
Export-Import Bank Reauthorization
Act of 2006
Act of 2006
1988.
3) The report would also include
information on the tied aid credit program.
4)The report would also include a
description of all Bank transactions
classified according to their principal
purpose, such as to correct a market failure
or to provide matching support.
5) The report would include a description
of the Bank’s efforts to promote exports
related to renewable energy sources.
6) A separate section of the report would:
a) compare the size of the Bank’s program
account with the size of the program
a c c o u n t s o f t h e o t h e r m a j o r
export-financing facilities; and
b) make recommendations with respect to
the relative size of the Bank program
account, based on factors including
whether the size differences are in the best
interests of the United States taxpayer.
7) A separate section would describe the
co-financing programs of the Bank and of
the other major export-financing facilities
referred to in paragraph (1), which would
include a list of which countries with
which the United States has in effect a
memorandum of understanding relating to
export credit agency co-financing and an
explanation of why such a memorandum is
not in effect with the countries with which
such a memorandum is not in effect.
8) A separate section which would describe
the participation of the Bank in providing
funding, guarantees, or insurance for
after-market services, which would include
appropriate informati on on t he
involvement of the other major
export-financing facilities referred to in
paragraph (1) in providing such support for
after-market services, and an explanation
of any differences among the facilities in
providing the support.

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9) Detailed information on cases of export
finance that are not in compliance with the
OECD Arrangement on Guidelines for
Officially Supported Export Credits, or
that exploit loopholes in the Arrangement
for the purpose of obtaining a commercial
competitive advantage.
10) A description of the extent to which the
activities of foreign export credit agencies
and other entities sponsored by a foreign
government, are not in compliance with the
OECD Arrangement and the WTO
A g r e e m e n t o n S u b s i d i e s a n d
Countervailing Measures and a description
of the actions taken by the United States
Government to address the activities.
The Board of Directors would be required
to vote to approve and would sign the
annual competitiveness report.
The report would also include any
dissenting views and additional comments
as any member of the Board of Directors
may submit to the Board for inclusion in
the report.
Report on Involvement of the Bank and
No comparable provision.
of Other Export Credit Agencies in
Regional Multi-Buyer Insurance
Programs and Working-Capital
Guarantee Programs.
The Bank would be required to report to
the Congress on:
(1) Regional multi-buyer insurance
programs and working capital guarantee
programs operated by, through, or in
conjunction with the Bank, which would
include an analysis of the effectiveness of
the programs and of how effective the
programs would be in increasing
export-related jobs in the United States if
the programs were larger;
(2) The size of similar programs of all
other major export-financing facilities
available from other governments and
government-related agencies through
which foreign exporters compete with

CRS-29
H.R. 5068
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United States exporters (including through
use of market windows (as defined in
section 10(h)(7)); and
(3) A detailed explanation, with respect to
the programs, of the working relationship
between the Bank and the Small Business
Administration, the Department of
Commerce, and other United States
Government agencies concerned with
increasing the number of export-related
jobs in the United States.
Environmental Matters
H.R. 5068 would have required the Bank to have two members of the Bank’s
Advisory Committee represent non-governmental environmental organizations.
H.R. 5068
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Environmental matters.
No comparable provision.
Not less than 2 members appointed to the
Advisory Committee would represent the
e n v i r o n m e n t a l n o n g o v e r n m e n t a l
organization community, except that no 2
of the members would be from the same
e n v i r o n m e n t a l o r g a n i z a t i o n .
Environmental organizations represented
would have demonstrated experience with
environmental issues associated with the
Bank, the Export Credit Group of the
Organization for Economic Cooperation
and Development, or both.
Eximbank’s Efforts to Assist New or Impoverished
Democracies
H.R. 5068 would have required the Bank to conduct a study to assess the needs
of new or impoverished democracies, such as Liberia and Haiti, and to determine
what role the Bank can play in assisting U.S. exports to meet the needs of new or
impoverished democracies. The Bank would have been required to prepare an

CRS-30
interim report for Congress within six months of passage of the measure and a final
report within one year to present the results of the Bank’s study.
H.R. 5068
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Study of how the Bank could assist U.S.
No comparable provision.
exporters to meet the needs of new or
impoverished democracies.
Study.
No comparable provision.
The Bank would conduct a study to assess
the needs of new or impoverished
democracies such as Liberia and Haiti, for
imports from the United States, and will
determine what role the Bank can play in
helping U.S. exporters take advantage of
these opportunities.
Reports to the Congress.
No comparable provision.
1) Interim report.
No comparable provision.
Within 6 months after the date of the
enactment of this Act, the Bank will submit
to the Committee on Financial Services of
the House of Representatives and the
Committee on Banking, Housing, and
Urban Affairs of the Senate, an interim
report that contains the results of the study
required by subsection.
2) Final report.
No comparable provision.
Within 12 months after the date of the
enactment of this Act, the Bank would be
required to submit to the House Committee
on Financial Services and the Senate
Committee on Banking, Housing, and
Urban Affairs, in writing a final report that
would contain the results of the study.
Review of Environmental Screening Requirements
H.R. 5068 would have required the Inspector General of the Bank to report to
Congress on the impact of altering the Bank’s environmental review procedures to
limit such reviews to projects valued at more than $10 million. The measure also
would have required the Inspector General to propose guidelines that are more
effective in assessing the potential environmental impact of a project.

CRS-31
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Review of environmental screening
No comparable provision.
requirement.
Within 6 months after the position of
Inspector General of the Export-Import
Bank of the United States is filled, the
Inspector General would be required to
submit to the House Committee on
Resources and the Committee on Financial
Services, and to the Senate Committee on
Banking, Housing, and Urban Affairs a
report on the implications of limiting the
requirement to conduct environmental
screenings of projects proposed to be
financed by the Bank to only those
involving at least $10,000,000.
The report would:
No comparable provision.
1) determine whether the $10,000,000
limitation prevents the identification of any
project that may have an adverse effect on
the environment; and
2) propose guidelines for how project
applications may be screened more
effectively to determine whether a project
may have such an effect.
Office of Renewable Energy Promotion
H.R. 5068 would have supported the Bank’s efforts to promote the export of
activities that promote renewable energy by establishing the Office of Renewable
Energy within the Bank. The office would have been responsible for identifying new
opportunities for financing projects involving renewable energy. The Bank would
have been required to report to congress annually on its efforts to promote renewable
energy projects.
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Office of renewable energy promotion.
No comparable provision.
Within 1 year after the date of the
enactment of this subsection, the President
of the Bank would be required to establish
and maintain in the Bank an office known

CRS-32
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as the ‘Office of Renewable Energy
Promotion.’
Functions: The Office would be
No comparable provision.
responsible for proactively identifying new
opportunities for renewable energy
financing. In carrying out its function of
promoting renewable energy technologies,
the Office would, among other things,
consider the recommendations made by the
Renewable Energy Export Advisory
Committee.
Staff: The President of the Bank would
No comparable provision.
ensure that the Office had staff with
appropriate expertise in renewable energy
technologies.
Annual reports: The Bank would be
No comparable provision.
required to submit annually to the House
Committee on Resources and the
Committee on Financial Services, and to
the Senate Committee on Banking,
Housing, and Urban Affairs, a report that
contained:
(A) a detailed description of the activities
of the Office; and
(B) an analysis comparing the level of
credit extended by the Bank for renewable
energy projects with the level of credit
extended for the preceding fiscal year.
Renewable energy technologies would be
defined as: technologies for producing
power through the use of solar energy,
wind energy, and energy from biomass,
fuel cells, or geothermal sources, and
technologies for producing less than 10
megawatts in hydropower.
Transparency
Both H.R. 5068 and S. 3938 include a section that was meant to help reduce the
“adverse effects of loans and guarantees on industries and employment in the United
States” as a result of Eximbank support for certain exports. The requirements in
these sections are meant to be part of a detailed economic impact analysis or study
completed by the Bank as part of a determination by the Bank to offer support for a

CRS-33
capital project or in support of export sales. In those cases in which the Bank
determined that it would undertake an economic impact analysis, the Bank would be
required to publish in the Federal Register a notice of its intent to conduct the study
and to seek public comments. The Bank also would be required to address in writing
the views of those who believe that they would be “substantially adversely affected”
by a proposed project.
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Transparency.
Same.
If, in deciding to make a loan or guarantee,
the Bank intended to conduct a detailed
economic impact analysis or similar study,
the Bank would be required to publish in
the Federal Register a notice of the intent,
and provide a period of not less than 14
days (which, on request by any affected
party, would be extended to a period of not
more than 30 days) for the submission to
the Bank of comments on the economic
effects of the provision of the loan or
guarantee.
In addition, the Bank would be required to
seek comments on the effects from the
D e partment o f C o mme r c e , t h e
International Trade Commission, the
Office of Management and Budget, the
Senate Committee on Banking, Housing,
and Urban Affairs, and the House
Committee on Financial Services.
The notice would be required to include
appropriate, nonproprietary information
about:
1) the name of the applicant;
2) the country to which the goods involved
in the transaction would be shipped;
3) the type of goods that would be
exported;
4) the amount of the loan or guarantee
involved;
5) the goods that would be produced as a
result of the provision of the loan or
guarantee;
6) the amount of increased production that
would result from the transaction;
7) the potential sales market for the
resulting goods;
8) the value of the transaction; and
9) any other relevant information.

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S. 3938
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Material changes in applications.
Same.
If a material change had been made to an
application for a loan or guarantee from the
Bank after a notice had been published
under this subparagraph, the Bank would
publish in the Federal Register a revised
notice of the intent, and would provide for
a comment period.
Material changes.
Same.
The term ‘material change’ would include:
1) a change of at least 25 percent in the
amount of a loan or guarantee requested in
the application; and
2) a change in the principal product to be
produced as a result of any transaction that
would be facilitated by the provision of the
loan or guarantee.
Requirement to consider adverse views.
Same.
Before taking final action on an application
for a loan or guarantee, the Bank would
consider and address in writing the views
of any person who may be substantially
adversely affected by the provision of the
loan or guarantee.
Publication of conclusions.
Same.
The Board of Directors would provide to
the affected party a non-confidential
summary of the facts found and
conclusions reached in any detailed
economic impact analysis or similar study
with respect to the loan or guarantee, that
were submitted to the Board of Directors.
Aggregate Authority
The Senate measure extends the Bank’s aggregate loan, guarantee, and
insurance authority to September 30, 2011.
H.R. 5068
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CRS-35
No comparable provision.
A g g r e g at e l oan, g u a r a n t e e , a n d
insurance authority.
The Bank’s aggregate loan, guarantee, and
insurance authority would be extended
through September 30, 2011.
Anti-Circumvention
Both H.R. 5068 and S. 3938 require the Bank to determine whether an entity
that received a loan or guarantee could produce products that would be in addition
to those specified in the application for the loan or guarantee and whether such
additional products could cause “substantial injury” to U.S. producers. In addition,
the Bank is prohibited from extending a loan or guarantee to a project if the Bank
determines that the action would result in the circumvention of a trade law or a trade
determination.
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Anti-circumvention.
Same.
In making a loan or guarantee, the Bank
would be required to determine whether
the facility that would benefit from the
extension of a credit or guarantee would be
reasonably likely to produce products in
addition to or other than the product
specified in the application and whether
the production of the products may cause
substantial injury to United States
producers of the same, or a similar or
competing, commodity.
Anti-circumvention.
Same.
The Bank would not be able to provide a
loan or guarantee if the Bank determined
that the action would facilitate
circumvention of a trade law order or
determination.
Financial threshold determinations.
Same.
In order to determine if a proposed
transaction exceeded a financial threshold,
the Bank would aggregate the dollar
amount of the proposed transaction and the
dollar amounts of all loans and guarantees,
approved by the Bank in the preceding
24-month period, that involved the same

CRS-36
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foreign entity and substantially the same
product to be produced.
Performance Standards for Small Businesses
According the House measure, the Comptroller General of the United States
would have been required to provide the Bank with a set of standards the Bank would
have used to determine the extent to which it had encouraged small business to
participate in international trade and to provide small business information about the
Bank’s programs. The Comptroller General also would have been required to
provide the Bank with a set of rules against which it would measure its success in
meeting the standards.
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Performance standards for assistance
No comparable provision.
for small businesses, especially those
owned by socially and economically
disadvantaged individuals and by
women.
Within 120 days after enactment of this
measure, the Comptroller General of the
United States will develop and transmit to
the Board of Directors of the
Export-Import Bank of the United States:
1) a set of standards which may be used to
determine the extent to which the Bank has
encouraged small business to participate in
international trade and to provide
information to small business about the
Bank’s programs; and
2) a set of rules for measuring the
performance of the Bank against the
standards.
3) Report on Performance: The Bank will
include in its annual report to the Congress,
the extent to which the Bank has
encouraged small business to participate in
international trade and to provide
information to small business about the
Bank’s programs.

CRS-37
Tied Aid Credit Program
Both measures alter the Bank’s tied aid program, although in decidedly different
ways. Currently, the Bank is required to utilize the tied aid fund to match offers of
tied aid credits by official export agencies that violate the OECD Arrangement on
tied aid and to support U.S. exporters who are placed at a competitive disadvantage
as a result of foreign offers of tied aid credits. H.R. 5068 would have added to this
list the requirement that the Bank support U.S. exporters that face competitors who
are receiving support from foreign export credit agencies that are not a party to the
OECD Arrangement. The House measure also would have required the Bank to
promote compliance with the OECD Arrangement among countries that currently are
not a party to the Arrangement. H.R. 5068 also would have reduced somewhat the
role of the Secretary of the Treasury in overseeing the tied aid program by removing
current requirements that the Bank work with the Secretary in administering the
program and in determining how the tied aid funds are used.
H.R. 5068 also would have provided guidance from the Congress to the
Secretary of the Treasury regarding negotiations on the OECD Arrangement. In
particular, the Secretary would have been required to inform the other participants
to the negotiations that the U.S. goals would be to: (1) seek compliance with the
Arrangement among countries with significant export credit programs that are not
parties to the Arrangement; (2) identify within the World Trade Organization the
extent to which countries that are not a party to the WTO Agreement on Subsidies
and Countervailing Measures are not in compliance with the terms of the OECD
Arrangement; and (3) implement new disciplines on the use of untied aid, market
windows, and other forms of exports finance that seek to exploit loopholes in the
Arrangement.
H.R. 5068 also would have expanded the current set of tied aid principles,
which requires the Bank to have “credible information” that an offer of tied aid exists
before the Bank can use its tied aid facility to match the offer. Instead, the Bank
would have needed only “credible evidence” of a tied aid offer to utilize its tied aid
program. This change would have eased the burden of proof on the Bank in those
cases in which the foreign entity is not a party to the OECD Arrangement and,
therefore, not required to inform other countries of its offers of tied aid. The measure
also would have required the President of the United States to notify Congress in
those cases in which the President, in consultation with the Secretary of the Treasury
and the President of the Bank, declined to match a foreign offer of tied aid because
he had determined that such an offer would “materially impede” the broader purposes
of the tied aid program.
S. 3938 charts a different approach to tied aid. The measure directs the Bank
to process applications for tied aid according to principles and standards that are
developed in cooperation with the Secretary of the Treasury. In addition, the measure
provides for a direct role for the Secretary of the Treasury in approvals of tied aid by
the Bank. Twenty days prior to the scheduled meeting of the Bank’s Board of
Directors to approve a application for tied aid, the Bank is directed to brief the
Secretary of the Treasury on the proposed application. The Secretary can request up
to a 14-day postponement of the Bank’s consideration of the proposed tied aid
application.

CRS-38
S. 3938 amends the current process for approving use of the tied aid facility by
providing that, on a case-by-case basis, the Secretary of the Treasury can appeal a
decision by the Bank’s Board of Directors to approve the use of the tied aid facility
by stating in writing the basis for the appeal to the President of the United States.
The President can overturn the Bank’s decision to use tied aid credits if he
determines that the use of the credits would “materially impede” achieving the major
purposes of the tied aid program, particularly enforcing the existing provisions of the
OECD Arrangement and negotiating new or revised agreements.
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
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Clarification of Use of Tied Aid Credit
No comparable provision.
Fund.
Would amend the Eximbank statute to add
a third task for the tied aid credit fund.
(The first two tasks are to: match offers of
tied aid credit by official credit agencies
when they violate the OECD Arrangement
and exploit loopholes; and support U.S.
exporters that who are placed at a
competitive disadvantage as a result of
foreign offers of tied aid credits.)
The Bank would be required to support
U.S. exporters when they face foreign
competition that is supported by foreign
export credit agencies or other entities
sponsored by a foreign government that are
not party to the Arrangement;
The Bank would also promote compliance
with Arrangement rules among foreign
export credit agencies that are not a party
to the Arrangement.
The measure would amend the current tied
aid process by removing the requirement
that the Bank administer the program in
consultation with the Secretary of the
Treasury. The measure would remove the
current requirement that the Bank work
jointly with the Secretary of the Treasury
in determining how the tied aid funds
should be used. Also, the measure would
remove the current requirement that the
Bank work with the Secretary of the
Treasury in developing a set of principles
and standards to use in administering the
tied aid program.
The measure would broaden the scope of

CRS-39
H.R. 5068
S. 3938
Export-Import Bank Reauthorization
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the tied aid program to use it to support
new measures on tied aid, enforce existing
arrangements and to bring into the
Arrangement those countries that are not
currently a party to the Arrangement.
The measure would expand the current set
of tied aid principles, which require the
Bank to have “credible information” about
a foreign offer of tied aid before the Bank
can use the tied aid fund to match a
specific offer by a foreign agency. In cases
where information about a specific offer of
foreign tied aid (or untied aid used to
promote exports as if it were tied aid) is
not available in a timely manner, or is
unavailable because the foreign export
credit agency involved is not subject to the
reporting requirements under the
Arrangement, then the Bank may decide to
use the Tied Aid Credit Fund based on
credible evidence of a history of such
offers under similar circumstances or other
forms of credible evidence.
The measure would also require the
President of the United States to notify the
Congress in those cases in which the
President, in consultation with the
Secretary of the Treasury and the President
of the Export-Import Bank had determined
that offering tied aid credit in a particular
circumstance would “materially impede”
the broader purposes of the tied aid
program.
Expansion of Countries in Competition
No comparable provision.
With Whom the Bank Is to Provide
Export Financing.
The measure would expand the number of
countries with which the Bank is
authorized to use its programs, including
its tied aid credit fund, to include countries
whose governments are not a party to the
OECD Arrangement.
Authority to Seek Use of Mixed Forms
No comparable provision.
of Concessional Financing.
The measure would add a new, final
section to the Bank’s authority to

CRS-40
H.R. 5068
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administer the tied aid credit program,
which could potentially broaden the scope
of the program. For purposes of improving
the effects of Bank financing on
development in tied aid eligible markets
(as defined under the Arrangement) and of
improving the competitiveness of the Bank
in the markets, the Bank would be
required, in consultation with United States
government aid agencies and, as
appropriate, multilateral aid institutions, to
seek to establish, consistent with the
Arrangement, a mixed credit program
consisting of longer term financing and
other forms of more flexible repayment
terms, financing of transactions in local
currencies, and other forms of concessional
financing that meets the needs of the
product sector and foreign market
involved.
Instructions Regarding Negotiation of
No comparable provision.
the OECD Arrangement.
The measure would direct the Secretary of
the Treasury to instruct the designee of the
Secretary responsible for negotiating the
WTO Arrangement to inform the other
participants in the negotiation that the
goals of the United States include the
following:
(1) Seeking compliance with the
Arrangement among countries with
significant export credit programs who are
not members of the Arrangement.
(2) Seeking to identify within the
World Trade Organization the extent to
which countries that are not a party to the
Arrangement are not in compliance with
the terms of the Agreement on Subsidies
and Countervailing Measures referred to in
section 101(d)(12) of the Uruguay Round
Agreements Act (19 U.S.C. 3511(d)(12)) in
regards to export finance, and seeking
appropriate action within the World Trade
Organization if a country is not in
compliance.

CRS-41
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(3) Implementing new disciplines on
the use of untied aid, market windows, and
other forms of export finance that seek to
exploit loopholes in the Arrangement for
purposes of obtaining a commercial
competitive advantage.
No comparable provision.
Tied aid credit program.
In handling applications involving the Tied
Aid Credit Fund to counter foreign credit:
1) The Bank would be required to process
an application for tied aid according to the
principles and standards developed
pursuant to subparagraph (A) and clause (i)
of this subparagraph. (Note: these
sections require the Bank to develop
standards regarding the processing of
applications for tied aid in cooperation
with the Secretary of the Treasury).
2) Twenty days prior to the scheduled
meeting of the Board of Directors at which
an application for tied aid would be
considered (unless the Bank determines
that an earlier discussion is appropriate
based on the facts of a particular
financing), the Bank would be required to
brief the Secretary of the Treasury on the
application and deliver to the Secretary
such documents, information, or data as
may reasonably be necessary to permit the
Secretary to review the application to
determine if the application complies with
the principles and standards developed in
this paragraph.
3) The Secretary could request a single
postponement of the Board of Directors’
consideration of an application for up to 14
days to allow the Secretary to submit to the
Board of Directors a memorandum
objecting to the application.
4) Case-by-case decisions on whether to
approve the use of the Tied Aid Credit
Fund would be made by the Board of
Directors, except that the approval of the
Board of Directors (or a commitment letter
based on that approval) shall not become

CRS-42
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final (except as provided in subclause (V)),
if the Secretary indicates to the President
of the Bank in writing the Secretary’s
intention to appeal the decision of the
Board of Directors to the President of the
United States and makes the appeal in
writing not later than 20 days after the
meeting at which the Board of Directors
considered the application.
5) The Bank would not grant final approval
of an application for any tied aid credit (or
a commitment letter based on that
approval) if the President of the United
States, after consulting with the President
of the Bank and the Secretary of the
Treasury, determines within 30 days of an
appeal by the Secretary that the extension
of the tied aid credit would materially
impede achieving the purposes described in
subsection (a)(6). (Note: the purposes
relate to enforcing the existing provision
within the OECD Arrangement on tied
aid and to negotiating or enforcing new
or revised agreements.) If no such
Presidential determination is made during
the 30-day period, the approval by the
Bank of the application (or related
commitment letter) that was the subject of
such appeal shall become final.
Prohibition on Assistance for Certain Railway Connections
This provision is intended to prevent U.S. funds from encouraging a Turkish
blockade of Armenia, which has been locked in a conflict with neighboring
Azerbaijan since the 1980s over the ethnic enclave of Nagorno-Karabakh. Under the
provision, the Bank is prohibited from promoting or funding a railroad running from
Azerbaijan through the Republic of Georgia and into Turkey.

CRS-43
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Prohibition on providing assistance to
Same.
develop or promote certain railway
connections.
The Bank would be prohibited from
providing guarantees, insurance, extending
credit, or participating in an extension of
credit in connection with the development
or promotion of any rail connections or
railway-related connections that do not
traverse or connect with Armenia, and do
traverse or connect Baku, Azerbaijan,
Tbilisi, Georgia, and Kars, Turkey.