Equator Principle 8
Contents
Equator Principle 8: Covenants
Principle 8 concerns specific Covenants linked to compliance. For all Projects, where a client is not in compliance with its environmental and social covenants, the EPFI will work with the client on remedial actions to bring the Project back into compliance.
If the client fails to re-establish compliance within an agreed grace period, the EPFI reserves the right to exercise remedies, including calling an event of default, as considered appropriate.
The client will covenant in the financing documentation to comply with all relevant host country environmental and social laws, regulations and permits in all material respects. Furthermore, for all Category A and Category B Projects, the client will covenant in the financial documentation:
- to comply with the ESMPs and EPAP (where applicable) during the construction and operation of the Project in all material respects; and
- to provide periodic reports in a format agreed with the EPFI (with the frequency of these reports proportionate to the severity of impacts, or as required by law, but not less than annually), prepared by in-house staff or third party experts, that i) document compliance with the ESMPs and EPAP (where applicable), and ii) provide representation of compliance with relevant local, state and host country environmental and social laws, regulations and permits; and
- to decommission the facilities, where applicable and appropriate, in accordance with an agreed Decommissioning Plan.
Project-Related Refinance and Project-Related Acquisition Finance
EPFIs will take reasonable measures to ensure that all existing environmental and social obligations continue to be included in the new financing documentation.
