Legal Framework
The separation of international project and export financing activities of KfW Bankengruppe is based on an understanding reached between the Federal Republic of Germany and the European Commission on the orientation of legally independent special credit institutions in Germany.
The understanding provides that KfW Bankengruppe may only benefit from the refinancing advantages in the form of liabilities assumed by the Federal Republic of Germany to perform its original clearly defined promotional tasks. According to the understanding all other activities will be separated as of January 2008 into a private-law credit institution, which will act under competitive market conditions. On 15 August 2003 the German Bundestag adopted the Promotional Bank Restructuring Act to translate the understanding into applicable law.
Until its separation as of 1 January 2008, KfW IPEX-Bank GmbH will remain a legally dependent business unit of KfW Bankengruppe. During this period the organisation and personnel of the bank will be gradually built up. The future bank will be fully subject to the German BankingAct (Kreditwesengesetz - KWG, in German only) and subject to taxation. KfW IPEX-Bank GmbH will operate as a 100% subsidiary of KfW Bankengruppe.
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