Export Development Corporation (Canada) : Established under the Export Credits Insurance Act (S.C. 1944-1945, c.39), which received Royal Assent on 4 March 1945, the Export Credits Insurance Corporation (ECIC) was the predecessor to the Export Development Corporation (EDC or the Corporation). The Act allowed for the ECIC to develop and facilitate trade between Canada and countries by providing insurance to Canadian exporters against losses due to insolvency, delays in collection, blockage or slowness in the transfer of funds which prevented the receipt of payment. Furthermore, during the three year transition period from war to peace, the Minister of Finance, authorized by the Governor in Council, could provide, through the ECIC, loans or guarantees to governments of other countries or their agencies for the development of trade with Canada.
As well as being a Crown Corporation, the ECIC was a share capital corporation with an initial authorized capital of five million dollars. As a corporate body, the ECIC had the ability to contract and to sue and be sued in the name of the Corporation. The initial members of the Board were the Deputy Minister of Trade and Commerce (who served as the Chair of the Board and President of the Corporation, although this function could be performed by two people), the Deputy Minister of Finance, the Governor of the Bank of Canada and not more than two others appointed by the Governor in Council to hold office during pleasure. The constituents of the Board were changed as the ECIC oriented itself within government and the Canadian export market. The authorized capital of the corporation also increased with inflation and expansions in business.
In 1959, the ECIC received the additional power, authorized by the Governor in Council, to provide financing to foreign buyers. This power was used to finance sales of long life capital goods on credit terms exceeding five years. However, the ECIC did not subsidize exporters and Canadian firms still had to compete in the export markets in terms of price, quality and delivery.
In 1960, the demand for long-term credit for capital projects led Parliament to amend the Act by adding a long-term financing facility to the ECIC's powers. Throughout the rest of the sixties, further amendments were made to the Act to allow the corporation to increase its financial ceiling and augment its services. The culmination of these changes and diversification of services was the decision to create a new Act and a new corporation. The Export Development Act (S.C. 17-18 Eliz. II (1969), c.39) received Royal Assent on 1 October 1969. Not only did the new Act incorporate the amended Export Credits Insurance Act, but the EDC financing facility was revised. All loans prior to this date were made from a government account and funded by borrowings from the Consolidated Revenue Fund. After 1969, the loan service became the responsibility of the Board of Directors of the EDC. The government account remained for `national interest' lending, which was also to be administered by the EDC. The new Act also added a new service: foreign investment insurance.
Like its predecessor, the EDC is a share capital corporation. While its initial authorized capital was limited to twenty-five million dollars, in 1972, the EDC began to raise its own money in capital markets through its own Treasury Department. By 1978, it was able to generate the money needed to meet its loan commitments without borrowing from the federal government. The authorized capital has been gradually increased from the original twenty-five million dollars. In 1999, the corporation was allowed 1.75 billion dollars in authorized capital.
During 1977 and 1978, two other major services were added to those offered by the Corporation: insurance and guarantees with respect to bid and performance securities provided by banks and surety companies.
Like the ECIC, direction of the EDC is vested in a Board of Directors who are drawn from the private and public sectors. The ratio of civil servants decreased, however, while in 1983 the Board numbers were increased from twelve to fifteen to allow for greater even representation from the private sector. The first Chair of the Board was JH Warren, who was also the Deputy Minister of the Department of Industry, Trade and Commerce (ITC). In 1975, the Deputy Minister of ITC no longer automatically served as the Chair, although s/he was still a member of the Board. Changes in government organization led to the successors of the ITC function related to international trade serving on the Board. With the retirement of Sylvain Cloutier in 1985, the function of President and Chair of the Board has been divided between two people.
Changes in government organization also led to changes in the Parliamentary reporting structure for the EDC. While the ECIC reported to the Department of Trade and Commerce, the 1969 re-organization led the corporation to report to the Minister of ITC. The Government Organization Act of 1983 assigned to the Department of External Affairs responsibility over international trade matters and provided for the appointment of a Minister of International Trade. Up to 1985, the EDC reported to both the Ministers of International Trade and External Affairs; then in 1986 solely to the Minister of International Trade.
In 1993, changes were made to the EDCs enabling legislation, allowing the Corporation to further expand its range of financing and insurance offerings.
