BGK MUNICIPAL FACILITY & COVID 19 RESPONSE

Intermediated framework loan to finance eligible projects and the COVID-19 response in municipalities in Poland.

The operation involves extending a framework loan to BGK, Poland's national promotional bank, aimed at financing eligible multi-sector investment plans in pre-defined sectors (including expenditures in healthcare and civil protection systems designed to respond to the the COVID-19 pandemic). The concrete schemes will be identified at a later stage. The project falls under the COVID-note since it will also finance: -COVID-19-related expenditures identified as eligible for financing for up to 100% of eligible project cost in the sectors of healthcare and civil protection (that are statutory tasks of Polish municipalities); and -investment projects not directly related to the COVID-19 emergency, but which will indirectly free up capacity for municipalities to finance COVID-19-related expenditures.

The Bank will ensure that all schemes financed under this operation comply with the relevant EU Directives: EU EIA Directive 2014/52/EU amending the EIA Directive 2011/92/EU, SEA Directive 2001/42/EC, Habitats and Birds Directives (92/43/EEC and 2009/147/EC respectively). For the new and refurbished buildings and energy efficiency measures, compliance of the schemes with the EU Directive on Energy Performance of Buildings will also be ensured. BGK's environmental management capacity to properly apply the EU Directives was assessed by the Bank under previous operations and was deemed satisfactory. The schemes to be proposed under this operation should have an overall positive impact on the environment and should promote sustainable urban development. Some of the schemes may, however, fall under Annex I or Annex II of the Directive 2014/52/EU amending the EIA Directive 2011/92/EU. This will be further assessed during project appraisal.

The Bank will require that BGK verifies that the municipalities ensure that contracts for implementation of each scheme are tendered in accordance with the applicable EU procurement legislation, 2014/24/EU, 2014/25/EU as well as Directive 92/13/EEC or Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the Official Journal of the EU, as and where required.