International Development Association Act 1960 (Cth)

International Development Association Act 1960 Act No. 21 of 1960 as amended This compilation was prepared on 20 November 2000 taking into account amendments up to Act No. 51 of 1963 The text of any of those amendments not in force on that date is appended in the Notes section Prepared by the Office of Legislative Drafting, Attorney‑General's Department, Canberra Contents 1 Short title [see Note 1]........................... 2 Commencement [see Note 1]....................... 3 Interpretation................................. 4 Acceptance of membership in the Association............. 5 Appropriation................................ 6 Issue of securities.............................. The Schedule Notes An Act to approve Acceptance by Australia of Membership in the International Development Association, and for purposes connected therewith 1 Short title [see Note 1] This Act may be cited as the International Development Association Act 1960. 2 Commencement [see Note 1] This Act shall come into operation on the day on which it receives the Royal Assent. 3 Interpretation In this Act: the Agreement means the Articles of Agreement of the International Development Association set out in the Schedule to this Act. the Association means the International Development Association established under the Agreement. 4 Acceptance of membership in the Association Approval is hereby given to the acceptance by Australia of membership in the Association. 5 Appropriation There may be paid out of the Consolidated Revenue Fund, which is appropriated accordingly, any moneys necessary for the purpose of making any payment required to be made by Australia to the Association by reason of its membership in the Association, including any moneys necessary to redeem a security issued under the next succeeding section. 6 Issue of securities (1) To the extent to which the Association is prepared to accept from Australia, in place of any payment that Australia has made or is required to make to the Association, notes or similar obligations issued by Australia, the Governor‑General may authorize the issue of securities. (2) Securities issued under the last preceding subsection: (a) shall be payable to the Association; (b) shall be non‑negotiable and non‑interest‑bearing; and (c) shall be payable at their par value on demand. The Schedule Section 3 ARTICLES OF AGREEMENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION The Governments on whose behalf this Agreement is signed, Considering: That mutual cooperation for constructive economic purposes, healthy development of the world economy and balanced growth of international trade foster international relationships conducive to the maintenance of peace and world prosperity; That an acceleration of economic development which will promote higher standards of living and economic and social progress in the less‑developed countries is desirable not only in the interests of those countries but also in the interests of the international community as a whole; That achievement of these objectives would be facilitated by an increase in the international flow of capital, public and private, to assist in the development of the resources of the less‑developed countries, do hereby agree as follows: INTRODUCTORY ARTICLE The INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called "the Association") is established and shall operate in accordance with the following provisions: ARTICLE I Purposes The purposes of the Association are to promote economic development, increase productivity and thus raise standards of living in the less‑developed areas of the world included within the Association's membership, in particular by providing finance to meet their important developmental requirements on terms which are more flexible and bear less heavily on the balance of payments than those of conventional loans, thereby furthering the developmental objectives of the International Bank for Reconstruction and Development (hereinafter called "the Bank ") and supplementing its activities. The Association shall be guided in all its decisions by the provisions of this Article. ARTICLE II Membership; Initial Subscriptions Section 1. Membership (a) The original members of the Association shall be those members of the Bank listed in Schedule A hereto which, on or before the date specified in Article XI, Section 2 (c), accept membership in the Association. (b) Membership shall be open to other members of the Bank at such times and in accordance with such terms as the Association may determine. Section 2. Initial Subscriptions (a) Upon accepting membership, each member shall subscribe funds in the amount assigned to it. Such subscriptions are herein referred to as initial subscriptions. (b) The initial subscription assigned to each original member shall be in the amount set forth opposite its name in Schedule A, expressed in terms of United States dollars of the weight and fineness in effect on January 1, 1960. (c) Ten percent of the initial subscription of each original member shall be payable in gold or freely convertible currency as follows: fifty percent within thirty days after the date on which the Association shall begin operations pursuant to Article XI, Section 4, or on the date on which the original member becomes a member, whichever shall be later; twelve and one‑half percent one year after the beginning of operations of the Association; and twelve and one‑half percent each year thereafter at annual intervals until the ten percent portion of the initial subscription shall have been paid in full. (d) The remaining ninety percent of the initial subscription of each original member shall be payable in gold or freely convertible currency in the case of members listed in Part I of Schedule A, and in the currency of the subscribing member in the case of members listed in Part II of Schedule A. This ninety percent portion of initial subscriptions of original members shall be payable in five equal annual instalments as follows: the first such instalment within thirty days after the date on which the Association shall begin operations pursuant to Article XI, Section 4, or on the date on which the original member becomes a member, whichever shall be later; the second instalment one year after the beginning of operations of the Association, and succeeding instalments each year thereafter at annual intervals until the ninety percent portion of the initial subscription shall have been paid in full. (e) The Association shall accept from any member, in place of any part of the member's currency paid in or payable by the member under the preceding subsection (d) or under Section 2 of Article IV and not needed by the Association in its operations, notes or similar obligations issued by the government of the member or the depository designated by such member, which shall be non‑negotiable, non‑interest‑bearing and payable at their par value on demand to the account of the Association in the designated depository. (f) For the purposes of this Agreement the Association shall regard as "freely convertible currency": (i) currency of a member which the Association determines, after consultation with the International Monetary Fund, is adequately convertible into the currencies of other members for the purposes of the Association's operations; or (ii) currency of a member which such member agrees, on terms satisfactory to the Association, to exchange for the currencies of other members for the purposes of the Association's operations. (g) Except as the Association may otherwise agree, each member listed in Part I of Schedule A shall maintain, in respect of its currency paid in by it as freely convertible currency pursuant to subsection (d) of this Section, the same convertibility as existed at the time of payment. (h) The conditions on which the initial subscriptions of members other than original members may be made, and the amounts and the terms of payment thereof, shall be determined by the Association pursuant to Section 1 (b) of this Article. Section 3. Limitation on Liability No member shall be liable, by reason of its membership, for obligations of the Association. ARTICLE III Additions to Resources Section 1. Additional Subscriptions (a) The Association shall at such time as it deems appropriate in the light of the schedule for completion of payments on initial subscriptions of original members, and at intervals of approximately five years thereafter, review the adequacy of its resources and, if it deems desirable, shall authorize a general increase in subscriptions. Notwithstanding the foregoing, general or individual increases in subscriptions may be authorized at any time, provided that an individual increase shall be considered only at the request of the member involved. Subscriptions pursuant to this Section are herein referred to as additional subscriptions. (b) Subject to the provisions of paragraph (c) below, when additional subscriptions are authorized, the amounts authorized for subscription and the terms and conditions relating thereto shall be as determined by the Association. (c) When any additional subscription is authorized, each member shall be given an opportunity to subscribe, under such conditions as shall be reasonably determined by the Association, an amount which will enable it to maintain its relative voting power, but no member shall be obligated to subscribe. (d) All decisions under this Section shall be made by a two‑thirds majority of the total voting power. Section 2. Supplementary Resources Provided by a Member in the Currency of Another Member (a) The Association may enter into arrangements, on such terms and conditions consistent with the provisions of this Agreement as may be agreed upon, to receive from any member, in addition to the amounts payable by such member on account of its initial or any additional subscription, supplementary resources in the currency of another member, provided that the Association shall not enter into any such arrangement unless the Association is satisfied that the member whose currency is involved agrees to the use of such currency as supplementary resources and to the terms and conditions governing such use. The arrangements under which any such resources are received may include provisions regarding the disposition of earnings on the resources and regarding the disposition of the resources in the event that the member providing them ceases to be a member or the Association permanently suspends its operations. (b) The Association shall deliver to the contributing member a Special Development Certificate setting forth the amount and currency of the resources so contributed and the terms and conditions of the arrangement relating to such resources. A Special Development Certificate shall not carry any voting rights and shall be transferable only to the Association. (c) Nothing in this Section shall preclude the Association from accepting resources from a member in its own currency on such terms as may be agreed upon. ARTICLE IV Currencies Section 1. Use of Currencies (a) Currency of any member listed in Part II of Schedule A, whether or not freely convertible, received by the Association pursuant to Article II, Section 2 (d), in payment of the ninety percent portion payable thereunder in the currency of such member, and currency of such member derived therefrom as principal, interest or other charges, may be used by the Association for administrative expenses incurred by the Association in the territories of such member and, insofar as consistent with sound monetary policies, in payment for goods and services produced in the territories of such member and required for projects financed by the Association and located in such territories; and in addition when and to the extent justified by the economic and financial situation of the member concerned as determined by agreement between the member and the Association, such currency shall be freely convertible or otherwise usable for projects financed by the Association and located outside the territories of the member. (b) The usability of currencies received by the Association in payment of subscriptions other than initial subscriptions of original members, and currencies derived therefrom as principal, interest or other charges, shall be governed by the terms and conditions on which such subscriptions are authorized. (c) The usability of currencies received by the Association as supplementary resources other than subscriptions, and currencies derived therefrom as principal, interest or other charges, shall be governed by the terms of the arrangements pursuant to which such currencies are received. (d) All other currencies received by the Association may be freely used and exchanged by the Association and shall not be subject to any restriction by the member whose currency is used or exchanged; provided that the foregoing shall not preclude the Association from entering into any arrangements with the member in whose territories any project financed by the Association is located restricting the use by the Association of such member's currency received as principal, interest or other charges in connection with such financing. (e) The Association shall take appropriate steps to ensure that, over reasonable intervals of time, the portions of the subscriptions paid under Article II, Section 2 (d) by members listed in Part I of Schedule A shall be used by the Association on an approximately pro rata basis, provided, however, that such portions of such subscriptions as are paid in gold or in a currency other than that of the subscribing member may be used more rapidly. Section 2. Maintenance of Value of Currency Holdings (a) Whenever the par value of a member's currency is reduced or the foreign exchange value of a member's currency has, in the opinion of the Association, depreciated to a significant extent within that member's territories, the member shall pay to the Association within a reasonable time an additional amount of its own currency sufficient to maintain the value, as of the time of subscription, of the amount of the currency of such member paid in to the Association by the member under Article II, Section 2 (d), and currency furnished under the provisions of the present paragraph, whether or not such currency is held in the form of notes accepted pursuant to Article II, Section 2 (e), provided, however, that the foregoing shall apply only so long as and to the extent that such currency shall not have been initially disbursed or exchanged for the currency of another member. (b) Whenever the par value of a member's currency is increased, or the foreign exchange value of a member's currency has, in the opinion of the Association, appreciated to a significant extent within that member's territories, the Association shall return to such member within a reasonable time an amount of that member's currency equal to the increase in the value of the amount of such currency to which the provisions of paragraph (a) of this Section are applicable. (c) The provisions of the preceding paragraphs may be waived by the Association when a uniform proportionate change in the par value of the currencies of all its members is made by the International Monetary Fund. (d) Amounts furnished under the provisions of paragraph (a) of this Section to maintain the value of any currency shall be convertible and usable to the same extent as such currency. ARTICLE V Operations Section 1. Use of Resources and Conditions of Financing (a) The Association shall provide financing to further development in the less‑developed areas of the world included within the Association's membership. (b) Financing provided by the Association shall be for purposes which in the opinion of the Association are of high developmental priority in the light of the needs of the area or areas concerned and, except in special circumstances, shall be for specific projects. (c) The Association shall not provide financing if in its opinion such financing is available from private sources on terms which are reasonable for the recipient or could be provided by a loan of the type made by the Bank. (d) The Association shall not provide financing except upon the recommendation of a competent committee, made after a careful study of the merits of the proposal. Each such committee shall be appointed by the Association and shall include a nominee of the Governor or Governors representing the member or members in whose territories the project under consideration is located and one or more members of the technical staff of the Association. The requirement that the committee include the nominee of a Governor or Governors shall not apply in the case of financing provided to a public international or regional organization. (e) The Association shall not provide financing for any project if the member in whose territories the project is located objects to such financing, except that it shall not be necessary for the Association to assure itself that individual members do not object in the case of financing provided to a public international or regional organization. (f) The Association shall impose no conditions that the proceeds of its financing shall be spent in the territories of any particular member or members. The foregoing shall not preclude the Association from complying with any restrictions on the use of funds imposed in accordance with the provisions of these Articles, including restrictions attached to supplementary resources pursuant to agreement between the Association and the contributor. (g) The Association shall make arrangements to ensure that the proceeds of any financing are used only for the purposes for which the financing was provided, with due attention to considerations of economy, efficiency and competitive international trade and without regard to political or other non‑economic influences or considerations. (h) Funds to be provided under any financing operation shall be made available to the recipient only to meet expenses in connection with the project as they are actually incurred. Section 2. Form and Terms of Financing (a) Financing by the Association shall take the form of loans. The Association may, however, provide other financing, either (i) out of funds subscribed pursuant to Article III, Section 1, and funds derived therefrom as principal, interest or other charges, if the authorization for such subscriptions expressly provides for such financing; or (ii) in special circumstances, out of supplementary resources furnished to the Association, and funds derived therefrom as principal, interest or other charges, if the arrangements under which such resources are furnished expressly authorize such financing. (b) Subject to the foregoing paragraph, the Association may provide financing in such forms and on such terms as it may deem appropriate, having regard to the economic position and prospects of the area or areas concerned and to the nature and requirements of the project. (c) The Association may provide financing to a member, the government of a territory included within the Association's membership, a political subdivision of any of the foregoing, a public or private entity in the territories of a member or members, or to a public international or regional organization. (d) In the case of a loan to an entity other than a member, the Association may, in its discretion, require a suitable governmental or other guarantee or guarantees. (e) The Association, in special cases, may make foreign exchange available for local expenditures. Section 3. Modifications of Terms of Financing The Association may, when and to the extent it deems appropriate in the light of all relevant circumstances, including the financial and economic situation and prospects of the member concerned, and on such conditions as it may determine, agree to a relaxation or other modification of the terms on which any of its financing shall have been provided. Section 4. Cooperation with Other International Organizations and Members Providing Development Assistance The Association shall cooperate with those public international organizations and members which provide financial and technical assistance to the less‑developed areas of the world. Section 5. Miscellaneous Operations In addition to the operations specified elsewhere in this Agreement, theAssociation may: (i) borrow funds with the approval of the member in whose currency the loan is denominated; (ii) guarantee securities in which it has invested in order to facilitate their sale; (iii) buy and sell securities it has issued or guaranteed or in which it has invested; (iv) in special cases, guarantee loans from other sources for purposes not inconsistent with the provisions of these Articles; (v) provide technical assistance and advisory services at the request of a member; and (vi) exercise such other powers incidental to its operations as shall be necessary or desirable in furtherance of its purposes. Section 6. Political Activity Prohibited The Association and its officers shall not interfere in the political affairs of any member; nor shall they be influenced in their decisions by the political character of the member or members concerned. Only economic considerations shall be relevant to their decisions, and these considerations shall be weighed impartially in order to achieve the purposes stated in this Agreement. ARTICLE VI Organization and Management Section 1. Structure of the Association The Association shall have a Board of Governors, Executive Directors, a President and such other officers and staff to perform such duties as the Association may determine. Section 2. Board of Governors (a) All the powers of the Association shall be vested in the Board of Governors. (b) Each Governor and Alternate Governor of the Bank appointed by a member of the Bank which is also a member of the Association shall ex officio be a Governor and Alternate Governor, respectively, of the Association. No Alternate Governor may vote except in the absence of his principal. The Chairman of the Board of Governors of the Bank shall ex officio be Chairman of the Board of Governors of the Association except that if the Chairman of the Board of Governors of the Bank shall represent a state which is not a member of the Association, then the Board of Governors shall select one of the Governors as Chairman of the Board of Governors. Any Governor or Alternate Governor shall cease to hold office if the member by which he was appointed shall cease to be a member of the Association. (c) The Board of Governors may delegate to the Executive Directors authority to exercise any of its powers, except the power to: (i) admit new members and determine the conditions of their admission; (ii) authorize additional subscriptions and determine the terms and conditions relating thereto; (iii) suspend a member; (iv) decide appeals from interpretations of this Agreement given by the Executive Directors; (v) make arrangements pursuant to Section 7 of this Article to cooperate with other international organizations (other than informal arrangements of a temporary and administrative character); (vi) decide to suspend permanently the operations of the Association and to distribute its assets; (vii) determine the distribution of the Association's net income pursuant to Section 12 of this Article; and (viii) approve proposed amendments to this Agreement. (d) The Board of Governors shall hold an annual meeting and such other meetings as may be provided for by the Board of Governors or called by the Executive Directors. (e) The annual meeting of the Board of Governors shall be held in conjunction with the annual meeting of the Board of Governors of the Bank. (f) A quorum for any meeting of the Board of Governors shall be a majority of the Governors, exercising not less than two‑thirds of the total voting power. (g) The Association may by regulation establish a procedure whereby the Executive Directors may obtain a vote of the Governors on a specific question without calling a meeting of the Board of Governors. (h) The Board of Governors, and the Executive Directors to the extent authorized, may adopt such rules and regulations as may be necessary or appropriate to conduct the business of the Association. (i) Governors and Alternate Governors shall serve as such without compensation from the Association. Section 3. Voting (a) Each original member shall, in respect of its initial subscription, have 500 votes plus one additional vote for each $5,000 of its initial subscription. Subscriptions other than initial subscriptions of original members shall carry such voting rights as the Board of Governors shall determine pursuant to the provisions of Article II, Section 1 (b) or Article III, Section 1 (b) and (c), as the case may be. Additions to resources other than subscriptions under Article II, Section 1 (b) and additional subscriptions under Article III, Section 1, shall not carry voting rights. (b) Except as otherwise specifically provided, all matters before the Association shall be decided by a majority of the votes cast. Section 4. Executive Directors (a) The Executive Directors shall be responsible for the conduct of the general operations of the Association, and for this purpose shall exercise all the powers given to them by this Agreement or delegated to them by the Board of Governors. (b) The Executive Directors of the Association shall be composed ex officio of each Executive Director of the Bank who shall have been (i) appointed by a member of the Bank which is also a member of the Association, or (ii) elected in an election in which the votes of at least one member of the Bank which is also a member of the Association shall have counted toward his election. The Alternate to each such Executive Director of the Bank shall ex officio be an Alternate Director of the Association. Any Director shall cease to hold office if the member by which he was appointed, or if all the members whose votes counted toward his election, shall cease to be members of the Association. (c) Each Director who is an appointed Executive Director of the Bank shall be entitled to cast the number of votes which the member by which he was appointed is entitled to cast in the Association. Each Director who is an elected Executive Director of the Bank shall be entitled to cast the number of votes which the member or members of the Association whose votes counted toward his election in the Bank are entitled to cast in the Association. All the votes which a Director is entitled to cast shall be cast as a unit. (d) An Alternate Director shall have full power to act in the absence of the Director who shall have appointed him. When a Director is present, his Alternate may participate in meetings but shall not vote. (e) A quorum for any meeting of the Executive Directors shall be a majority of the Directors exercising not less than one‑half of the total voting power. (f) The Executive Directors shall meet as often as the business of the Association may require. (g) The Board of Governors shall adopt regulations under which a member of the Association not entitled to appoint an Executive Director of the Bank may send a representative to attend any meeting of the Executive Directors of the Association when a request made by, or a matter particularly affecting, that member is under consideration. Section 5. President and Staff (a) The President of the Bank shall be ex officio President of the Association. The President shall be Chairman of the Executive Directors of the Association but shall have no vote except a deciding vote in case of an equal division. He may participate in meetings of the Board of Governors but shall not vote at such meetings. (b) The President shall be chief of the operating staff of the Association. Under the direction of the Executive Directors he shall conduct the ordinary business of the Association and under their general control shall be responsible for the organization, appointment and dismissal of the officers and staff. To the extent practicable, officers and staff of the Bank shall be appointed to serve concurrently as officers and staff of the Association. (c) The President, officers and staff of the Association, in the discharge of their offices, owe their duty entirely to the Association and to no other authority. Each member of the Association shall respect the international character of this duty and shall refrain from all attempts to influence any of them in the discharge of their duties. (d) In appointing officers and staff the President shall, subject to the paramount importance of securing the highest standards of efficiency and of technical competence, pay due regard to the importance of recruiting personnel on as wide a geographical basis as possible. Section 6. Relationship to the Bank (a) The Association shall be an entity separate and distinct from the Bank and the funds of the Association shall be kept separate and apart from those of the Bank. The Association shall not borrow from or lend to the Bank, except that this shall not preclude the Association from investing funds not needed in its financing operations in obligations of the Bank. (b) The Association may make arrangements with the Bank regarding facilities, personnel and services and arrangements for reimbursement of administrative expenses paid in the first instance by either organization on behalf of the other. (c) Nothing in this Agreement shall make the Association liable for the acts or obligations of the Bank, or the Bank liable for the acts or obligations of the Association. Section 7. Relations with Other International Organizations The Association shall enter into formal arrangements with the United Nations and may enter into such arrangements with other public international organizations having specialized responsibilities in related fields. Section 8. Location of Offices The principal office of the Association shall be the principal office of the Bank. The Association may establish other offices in the territories of any member. Section 9. Depositories Each member shall designate its central bank as a depository in which the Association may keep holdings of such member's currency or other assets of the Association, or, if it has no central bank, it shall designate for such purpose such other institution as may be acceptable to the Association. In the absence of any different designation, the depository designated for the Bank shall be the depository for the Association. Section 10. Channel of Communication Each member shall designate an appropriate authority with which the Association may communicate in connection with any matter arising under this Agreement. In the absence of any different designation, the channel of communication designated for the Bank shall be the channel for the Association. Section 11. Publication of Reports and Provision of Information (a) The Association shall publish an annual report containing an audited statement of its accounts and shall circulate to members at appropriate intervals a summary statement of its financial position and of the results of its operations. (b) The Association may publish such other reports as it deems desirable to carry out its purposes. (c) Copies of all reports, statements and publications made under this Section shall be distributed to members. Section 12. Disposition of Net Income The Board of Governors shall determine from time to time the disposition of the Association's net income, having due regard to provision for reserves and contingencies. ARTICLE VII Withdrawal; Suspension of Membership; Suspension of Operations Section 1. Withdrawal by Members Any member may withdraw from membership in the Association at any time by transmitting a notice in writing to the Association at its principal office. Withdrawal shall become effective upon the date such notice is received. Section 2. Suspension of Membership (a) If a member fails to fulfill any of its obligations to the Association, the Association may suspend its membership by decision of a majority of the Governors, exercising a majority of the total voting power. The member so suspended shall automatically cease to be a