Zagreb Airport

Location:

Croatia

Project number:

50391

Business sector:

Transport

Notice type:

Private

Environmental category:

B

Target board date:

19 Sep 2018

Status:

Disbursing

PSD disclosed:

05 Aug 2019

Translated version of this PSD: Croatian

Project Description

Provision of long term financing to support the financial restructuring of concession of Zagreb Airport, Croatia's main airport.

Project Objectives

The Bank's financing would contribute towards the strengthening of the balance sheet structure of the company as part of a wider refinancing package, with a view to ensuring the airport's financial sustainability in the longer term.

Transition Impact

The transition impact of this project is anticipated from the:

(1) enhanced resilience through development of PPP markets and capital markets.

Successful balance sheet restructuring of Zagreb airport will improve the sustainability of the concession arrangements in the medium to longer term, permitting further private concessions and efficient operations by commercial parties. The contribution to the restructuring is expected to maintain confidence in the operation and keep a key infrastructure run by the private sector.

(2) improved standards of corporate governance and business practices to contribute to a wellgoverned economy.

The Project supports sustainability of the first open tendered transport concession, related to one of Croatia's key infrastructure assets.

Client Information

MEDUNARODNA ZRACNA LUKA ZAGREB D.D, Croatia's largest international airport.

EBRD Finance Summary

EUR 57,786,842.00

A senior loan of up to EUR 57.8m, in parallel with the participation of commercial lenders.

Total Project Cost

EUR 199,870,000.00

Environmental and Social Summary

Categorised B (ESP 2014).  Zagreb Airport has been in operation since the 1960s. The environmental and social due diligence (ESDD) undertaken by the Bank's Environmental and Sustainability Department showed that the continued operation of the airport is associated with some environmental and social impacts and risks, which are site specific and are being addressed by the Company under relevant permits and licences. ESDD also showed that the Company has the capacity to meet the EBRDs Performance Requirements (PRs). The ESDD, reviewed the results of the previous DD undertaken in 2012 and updated it through the review of the up-to-date information provided by MZLZ, and a visit to the airport including airside facilities and discussions with the Company's management. ESDD showed that the Company has a robust management system in place, together with the necessary capacities, to manage environment, social and health and safety issues at the airport. MZLZ is ISO 9001:2015, 14001:2015 and 10002:2014 certified and has an IMS in place which covers environment, health and safety, and emergency response and is in line with the PRs and has shown to be effective.  All necessary permits are in place, and these include: Aerodrome Certificate issued by the Croatian Civil Aviation Agency (CCAA) in line with Regulation (EC) 216/2008 and 139/2014 and Environmental Permit issued in 2012. The key operational document of MZLZ is its Aerodrome Manual, drafted in line with Regulation (EC) 139/2014 and approved by the Croatian Civil Aviation Agency.

The Company oversees all activities at the airport but certain functions such as airside handling, security services and fuelling services are provided by sister companies or separate companies.  The Company is, however, able to influence and guide the activities and associated E&S performance of these companies to ensure they are in line with the Aerodrome Manual, which include various E&S provisions. Air quality is monitored in the vicinity of the runway and levels are below permitted EU thresholds with the exception of PM10 whose levels are exceeded in the winter months due to poor heating systems of the surrounding settlements. Noise levels are monitored at various locations and are below permitted thresholds except occasionally during military aircraft operations, which is outside the scope of MZLZ. The Company has in place a noise reduction plan to mitigate the impacts of noise emissions. All wastewater on site is directed to the on-site wastewater treatment plant and is continually monitored. Waste is segregated on site and disposed of as appropriate by specialist companies. Fuelling operations and storage are operated by the national oil company INA d.d. with whom the Company has an agreement in place. The Company regularly audits INA’s compliance to JIG 1 and JIG 2 standards. The Company is active in the area of reduction of the green- house gases emissions from their direct operations (the Company developed and implements Airport Carbon Management Plan 2018-2020, and holds Airport Carbon Accreditation – level 2). The new passenger terminal is LEED Silver certified. 

The necessary emergency preparedness and response plans are in place in line with ICAO requirements. Fire, medical and emergency services are in place and provided by MZLZ.  The airport is not located on any bird migratory routes.  Bird collisions are avoided through the use of sonic transmitters, sonic cannons and traps. 

The Company's HR provisions are in line with local requirements and PR 2. The Company currently employs directly circa 102 people of which circa 61% female and 39% male. There is a trade union active in the Company (71% of employees are members) and regularly consulted in crucial decisions and documents such as the Collective Agreement. There is a grievance mechanism set up for employees enabling anonymous raising of grievances. Supply chains are managed through internal procedures which take into consideration EHSS requirements.

The Company regularly discloses substantial E&S information through its website, including Annual Noise Levels since 2014, Noise Reduction Action Plan, Carbon Reduction Action Plan. MZLZ is ISO 10002 accredited and has in place robust procedures for handling of customers’ complaints and comments.

The Company is in line with the Performance Requirements and the ESDD concluded that no ESAP is required. The Company will be required to continue to operate in line with the PRs and to submit annual environmental and social reports to the Bank.

Technical Cooperation

None.

Company Contact Information

Medunarodna zracna luka Zagreb d.d.
http://www.zagreb-airport.hr/
Ulica Rudolfa Fizira 1 City of Velika Gorica 10 150 Zagreb Croatia

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.