Brussels, 18/12/2003 (Agence Europe) - On Tuesday, the European Commission approved a German proposal to provide public fallback guarantees to "secure" credits granted to finance ships built in German shipyards. The guarantees will be implemented in the five coastal Länder (Niedersachsen, Bremen, Hamburg, Schleswig-Holstein and Mecklenburg-Vorpommern). The scheme introduces the new element of risk differentiation. According to this, different premiums will be charged depending on the level of risk - of which there are six - to be covered by the guarantee. In practice, therefore, cheaper premiums will be charged for lower risk projects. Two types of guarantee can be granted - construction financing guarantees, which are designed to secure the pre-financing of the construction costs of the vessel until delivery by the yard, and end-financing guarantees, aimed at financing the purchase of the completed ship by the owner. The schemes are approved until 31 December 2006. Prior to that date, the Commission will review the new system in the light of experience gained over the first three years. The Competition Commissioner, Mario Monti, highlighted the effective cooperation between the German authorities and the Commission services and said that this case could serve as an example for future assessment of guarantee schemes in the shipbuilding sector.