International Finance Corporation Agreement Act

Link to law: http://www.moj.gov.jm/laws/international-finance-corporation-agreement-act
Published: 1964-03-05

INTERNATIONAL FINANCE CORPORATION
AGREEMENT

1

Ad
3011964.

THE INTERNATIONAL. FINANCE CORPORATION
AGMEMENT ACT

[5fh March, 1964.1

1. This Act may be cited as the International Finance Shorttitle.
Corporation Agreement Act.

Inlcrprrta-
tioa

2. In this Act-
“the Corporation” means the International Finance

Corporation established by the Corporation
Agreement;

“the Corporation Agreement” means the Agreement,
as amended, for the establishment and operation
of an international body to be called the Interna-
tional Finance Corporation, and of which the text
of the Articles is set out in the Schedule;

“the Membership Resolution” means the Resolution
adopted by the Board of Governors of the
Corporation, specifying the terms and conditions
upon which Jamaica shall be admitted to member-
ship of the Corporation.

scbcdula

3. Acceptance by the Government of the Corporation A ~ ~ ~ ~ u
of accept-
ance of
c a r p o n -
tioo Agree-
mmt

4,-(1) The Minister responsible for finance k authorized Financial
to pay for the account of Jamaica the amounts payable ProVioiona
from time to time to the Corporation under the Member-
ship Resolution and the Corporation Agreement:

Agreement is hereby approved.

p-ho inclusion of this t mthond ’ by LN. 480119131

2 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

Provided that the Bank of Jamaica may from time to
time, subject to the terms of any agreement made by that
Bank with the Government, pay from its own funds such
of the amounts aforesaid as may be specified in the agree-
ment.

(2) The Minister responsible for finance may borrow
from any person, any sum or sums required for payments
under this section and, for the purpose of such borrowing,
he may create and issue any securities bearing such rate of
interest and subject to such conditions as to repayment,
redemption or otherwise as he thinks fit.

(3) The principal and interest of any securities
issued under subsection (2) and the expenses incurred in
connection with their issue shall be charged on the
Consolidated Fund.

(4) Subject to the terms of any agreement to the
contrary made by the Bank of Jamaica with the
Government pursuant to the proviso to subsection (11,
any moneys received by the Government from the
Corporation or raised by securities under subsection (2)
shall be paid into the Consolidated Fund Account and
shall form part of the Consolidated Fund and be available
in any manner in which that Fund is available.

(5) The Bank of Jamaica shall act as a depository
for the holdings of currency of Jamaica and other assets
of the Corporation.

status., .
andprivi.
legeEofthe Corpora-

ti0n.

5. The provisions of sections 2, 3, 4, 5, 6, 7, 8 and 9
of Article VI of the Corporation Agreement shall have the
force of law in Jamaica, subject to the proviso that
nothing in section 9 of Article VI of the Corporation
Agreement shall be construed-

(if as entitling the Corporation to import goods free

irnrnunitica

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INTERNATIONAL FINANCE CORPORATION
AGREEMENT

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of customs duty without any restriction on their
subsequent sale in the country to which they were
imported;

(ii) as conferring on the Corporation any exemption
from duties or taxes which form part of the price
of goods sold; or

(iii) as conferring on the Corporation any exemption
from taxes or duties which are in fact no more
than charges for services rendered.

SCHEDULE

(Section 2)
ARTICLES OF AGREEMENT OF THE INTERNATIONAL

FLNANCE CORPORATION

The Governments on whose behalf this Agreement is signed agree
as follows :

INTRODUCTORY ARTICLE
THR INTERNATIONAL FINANCE CORPORATION (hereinafter called the

Corporation) is established and shall operate in accordance with the
following provisions:

ARTICLE I
Purpose

The purpose of the Corporation is to further economic development
by encouraging the growth of productive private enterprise in member
countries, particularly in the less developed areas, thus supplementing
the activities of the International Bank for Reconstruction and
Development (hereinafter called the Bank). In carrying out this
purpose, the Corporation shall :

(i) in association with private investors, assist in financing the
establishment, improvement and expansion of productive
private enterprises which would contribute to the development
of its member countries by making investments, without
guarantee of repayment by the member government wncerned,
in cases where sufficient private capital is not available on
reasonable terms:

(ii) seek to briog together investment opportunities, domestic and
foreign private capital. and experienced management: and

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INTERiVATTlONAL FINANCE CORPORATION
AGREEMENT

(iii) seek to stimulate, and to help create conditions conducive to.
the flow of private capital, domestic and foreign, into pro-
ductive investment in member countries.

The Corporation shall be guided in all its decisions by the provisions
of this Article.

ARTICLE I1
Membership and Capital

SECTION 1. Membership
(a) The original members of the Corporation shall be those members

of the Bank listed in Schedule A hereto which shall, on or before the
date specified in Article IX, section Z(c), accept membership in the
Corporation.

( b ) Membership shall be open to other members of the Bank at such
times and in accordance with such terms as may be prescribed by the
Corporation.

SECTION 2. Capital Stock
(a) The authorized capital stock of the Corporation shall be

5100,000,000, in terms of United States dollars.
(b) The authorized capital stock shall be divided into 100.000 shares

having a par value of one thousand United States dollars each. Any
such shares not initially subscribed by original members shall be
available for subsequent subscription in accordance with section 3(d)
of this Article.

(c) The amount of capital stock at any time authorized may be
increased by the Board of Governors as follows:

(i) by a majority of the votes cast, in case such increase is
necessary for the purpose of issuing shares of capital stock on
initial subscription by members other than original members,
provided that the aggregate of any increases authorized pur-
suant to this subparagraph shall not exceed 10,000 shares:

(ii) in any other case, by a three-fourths majority of the total
voting power.

(d) In case of an increase authorized pursuant to paragraph (c) (ii)
above, each member shall have a reasonable opportunity to subscribe,
under such conditions as the Corporation shall decide, to a proportion
of the increase of stock equivalent to the proportion which its stock
theretofore subscribed bears to the total capital stock of the Corpora-
tion, but no member shall be obligated to subscribe to any part of the
increased capital.

(e) Insurance of shares of stock. other than those subscribed either
on initial subscription or pursuant to paragraph (d) above, shall

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INTERNATlONAL FINANCE CORPORATION
AGREEMENT

require a three-fourths majority of the total voting power.

scription only by, and shall be issued only to, members.
Shares of s t d of the Corporation shall be available for sub-

SECTION 3. Subscriptions
(a) Each original member shall subscribe to the number of shares

of stock set forth opposite its name in Schedule A. The number uf
shares of stock to be subscribed by other members shall be determined
by the Corporation.

(b) Shares of stock initially subscribed by original membcrs shall
be issued at par.

(c) The initial subscription of each original member shall be payable
in full within 30 days after either the date on which the Corporation
shall begin operations pursuant to Article M, section 3 (b), or the
date on which such original member becomes a member, whicbeker
shall be later or at such date thereafter as the Corporation shall
determine. Payment shall be made in gold or United States dollars
in response to a call by the Corpuratioa which shall specify the place
01 places of payment.
(4 The price and other terms of subscription of shares of stock to

be subscribed, otherwise than on initial subscription by original mem-
bers, shall be determined by the Corporation.

SECTON 4. Limitution on Liability
No member shall be liable, by reason of its membership. for

SECTION 5.
Shares of stock shall not be pledged or encumbered in any manner

ARTICLE IQ
0,uerations

obligations of the Corporation.

Restriction on Transfers and Pledges of Shares

whatever, and shall be transferable only to the Corporation.

SECTION 1. Finnncing Operations
The Corporation may make investments of its funds in productive

private enterprises in the territories of its members. The existence
of a government or other public interest in such an enterprise shall not
necessarily preclude the Corporation from making an investment there-
in.

SECTION 2. Forms of Fimcing
The Corporation may make investments of its funds in such form or

SECTION 3. Operational Principles
The operations of the Corporation shall be conducted in accordance

fonns as it may deem appropriate in the circumstances.

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6 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

with the following principles :
(i) the Corporation shall not undertake any financing for which

in its opinion su5cient private capital could he obtained on
reasonable terms;

(ii) the Corporation shall not finance an enterprise in the terri-
tories of any member if the member objects to such financing;

(i i i ) the Corporation shall impose no conditions that the proceeds
of any financing by it shall be spent in the territories of any
particular country;

(iv) the Corporation shall not assume responsibility for managing
any enterprise in which it has invested and shall not exercise
voting rights for such purpose or for any other purpose which,
in its opinion, properly is within the scope of managerial
control;

(v) the Corporation shall undertake its financing on terms and
wnditions which it considers appropriate. taking into amount
the requirements of the enterprise, the risks being undertaken
by the Corporation and the terms and wnditions normally
obtained by private investors for similar financing:

(vi) the Corporation shall seek to revolve its funds by selling its
investments to private investors whenever it can appro-
priately do so on satisfactory terms;

(vii) the Corporation shall seek to maintain a reasonable diversi-
fication in its investments.

SECTION 4. Protection of Interests
Nothing in this Agreement shall prevent the Corporation, in the

event of actual or threatened default on any of its investments.
adual or threatened insolvency of the enterprise in which such invest-
ment shall have been made, or other situations which. in the opinion
of the Corporation, tbreaten to jeopardize such investment, from taking
such action and exercising such rights as it may deem necessary for
the protection of its interests.

SECTION 5. Applicubiliiy of Cerfain Foreign Exchange Reslrictioiis
Funds received by or payable to the Corporation in respect of an

investment of the Corporation made in any member’s territories
pursuant to section 1 of this Article shall not be free, solely by
reason of any provision of this Agreement, from generally applicable
foreign exchange restrictions, regulations and controls in force in the
territories of that member.

SECTION 6. Miscellaneous Operations
In addition to the operations specified elsewhere in this Agreement,

the Corporation shall have the power to:
(i) borrow funds, and in that connection to furnish such collateral

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INTERNATIONAL FINANCE CORPORATION
AGREEMENT

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or other security therefor as it shall determine: provided,
however, that before making a public sale of its obligations
in the markets of a member, the Corporation shall have
obtained the approval of that member and of the member in
whose currency the obligations are to be denominated;

(ii) invest funds not needed in its financing operations in such
obligations as it may determine and invest funds held by it
for pension or simiiar purposes in any marketable securities,
all without being subject to the restrictions imposed by other
sections of this Article;

(iii) guarantee securities in which it has invested in order to
facilitate their sale;

(iv) buy and sell securities it has issued or guaranteed or in which
it has invested:

(v) exercise such other powers incidental to its business as shall
be necessary or desirable in furtherance of its purposes.

SKITON I . Valuation of Currencies
Whenever it shall become necessary under this Agreement to value

any currency in terms of the value of another currency, such valua-
tion shall be as reasonably determined by the Corporation after
consultation with the Intemationl Monetary Fund.

SECITON 8. W m ’ n g to be Placed on Securities
Every security issued or guaranteed by the Corporation shall bear

on its face a conspicuous statement to the effect that it is not an
obligation of the Bank or, unless expressly stated on the security, of
any government.

SECTION 9. Political Activity Prohibifed
The Corporation 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 IV

Organizntion and Management
SECTION 1 . Structure of the Corporation
The Corporation shall have a Board of Governors, a Board of Direc-

tors, a Chairman of the Board of Directors. a President and such other
offims and staff to perform such duties as the Corporation may
determine.

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8 I N l E R NATIONAL FlNA NCE CORPORA TION
AGREEMENT

SECTION 2. Board of Governors
(a) All the powers of the Corporation 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 Corporation
shall ex oficio be a Governor or Alternate Governor. respectively, of
the Corporation. No Alternate Governor may vote except in the
absence of his principal. The Board of Governors shall select one of
the Governors as Chairman of the Board of Governors. A n y Governor
or Alternate Governor shall cease to hold otiice if the member by
which he was appointed shall cease to be a member of the Corporation.

(c) The Board of Governors may delegate to the Board of Directors
authority to exercise any of its powers, except the power to:

(i) admit new members and determine the conditions of their
admission;

(ii) increase or decrease the capital stock;
(iii) suspend a member:
(iv) decide appeals from interpretations of this Agreement given

by the Board of Directors:
(v) make arrangements to co-operate with other international

organizations (other than informal arrangements of a tem-
porary and administrative character);

(vi) decide to suspend permanently the operations of the Cor-
poration and to distribute its assets;

(vii) declare dividends;
(viii) amend 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 Board of 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 quornm 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 Corporation may by regulation establish a procedure whereby
the Board of 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 Board of Directors to the
extent authorized. may adopt such rules and regulations as may be
necessary or appropriate to conduct the business of the Corporation.

(1) Governors and Alternate Governors shall serve as such without
compensation from the Corporation.

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INTERNA TIONA L FINA NCE CORPORATION
AGREEMENT

SECTTON 3. Voting
(a) Each member shall have two hundred fifty votes plus one

(b) Except as otherwise expressly provided, all matters before the

SECTION 4. Board of Directors
(U) The Board of Directors shall be responsible for the conduct of

the general operations of the Corporation, and for this purpose shall
exercise all the powers given to it by this Agreement or delegated to
it by the Board of Governors.

(b) The Board of Directors of the Corporation shall be composed
ex oficio of each Executive Director of the Bank who shall have been
either (i) appointed by a member of the Bank which is also a member
of the Corporation, 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
Corporation shall have counted toward his election. The Alternate
to each such Executive Director of the Bank shall ex oficio be an
Alternate Director of the Corporation. 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 Corporation.

(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 so appointed is entitled to cast in the Corporation,
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 Corporation whose votes counted toward his election in the
Bank are entitled to cast in the Corporation. All the votes which
a Director is entitled to cast shall be cast as a unit.

(4 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 hut shall not vote.

(e) A quorum for any meeting of the Board of Directors shall be
a majority of the Directors exercising not less than one-half of the
total voting power.

(fl The Board of Directors shall meet as often as the business r.f
the Corporation may require.

(g) The Board of Governors shall adopt regulations under which a
member of the Corporation not entitled to appoint an Executive
Director of the Bank may send a representative to attend any meeting
of the Board of Directors of the Corporation when a request made by,
or a matter particularly affecting, that member is under consideration.

SECTION 5.
(a) The President of the Bank shall be ex oficio Chairman of the

Board of Directors of the Corporation, but shall have no vote except

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additional vote for each share of stock held.

Corporation shall be decided by a majority of the votes cast.

Chairman, President and Sta8

9

10 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

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 of the Corporation shall be appointed by the
Board of Directors on the recommendation of the Chairman. The
President shall be chief of the operating staff of the Corporation.
Under the direction of the Board of Directors and the general super-
vision of the Chairman. he shall conduct the ordinary business of the
Corporation and under their general control shall be responsible for
the organization, appointment and dismissal of the officers and sta8.
The President may participate in meetings of the Board of Directors
but shall not vote at such meetings. The President shall cease to
hold office by decision of the Board of Directors in which the Chairman
concurs.

(c) The President, officers and staff of the Corporation, in the dis-
charge of their offices, owe their duty entirely to the Corporation and
to no other authority. Each member of the Corporation 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) Subject to the paramount importance of securing the highest

standards of efficiency and of technical competence. due regard shall
he paid, in appointing the officers and staff of the Corporation, to
the importance of recruiting personnel on as wide a geographical basis
as possible.

SECTION 6.
(a) The Corporation shall be an entity separate and distinct from

the Bank and the funds of the Corporation shall be kept separate and
apart from those of the Bank. The Corporation shall not lend to or
borrow from the Bank. The provisions of this section shall not
prevent the Corporation from making arrangements with the Bank
regarding facilities. personnel and services and arrangements for reim-
bursement of administrative expenses paid in the first instance by
eilher organization on behalf of the other.

( b ) Nothing in this Agreement shall make the Corporation liable for
the acts or obligations of the Bank. or the Bank liable for the acts
or obligations of the Corporation.

Relationship to the Bank

SECTION 7. Relationr with other International Organizations
The Corporation, acting through the Bank, shall enter into formnl

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 Ofices
The principal office of the Corporation shall be in the same locality

as the principal office of the Bank. The Corporation may establish
other offices in the territories of any member.

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AGREEMENT

11

SECTION 9. Deposifors
Each member shall designate its central bank as a depository in

which the Corporation may keep holdings of such member's currency
or other assets of the Corporation or, if it has no central bank, it
shall designate for such purpose such other institution as may he
acceptable to the Corporation.

SECTION 10. Channel of Communicafion
Each member shall designate an appropriate authority with which

the Corporation may communicate in connection with any matter
arising under this Agreement.

SECTION 11. Publication of Reports and Provision of Information
(a) The Corporation shall publish an annual report containing an

audited statement of its amounts and shall circulate to members at
appropriate intervals a summary statement of its financial position
and a proEt and loss statement showing the results of its operations.

(b) The Corporation 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. Dividends
(a) The Board of Governors may determine from time to time what

part of the Corporation's net income and surplus after making appro-
priate provision for reserves, shall he distributed as dividends.

(6 ) Dividends shall be distributed pro rafu in proportion to capital
stock held by members.

(c) Dividends shall be paid in such manner and in such currency
or currencies as the Corporation shall determine.

ARTICLB v
Wi:hdrawal: Suspension of Membership: Suspension of Operations
SECTION 1. Withdrawal by Members
Any member may withdraw from membership in the Corporation at

any time by transmitting a notice in writing to the Corporation 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 fulfil any of its obligations to the Cor-

poration, the Corporation may suspend its membership by decision o f
a majority of the Governors. exercising a majority of the total voting
power. The member so suspended shall automatically cease to he
a member one year from the date of its suspension unless a decision
is taken by the same majority to restore the member to good standing.

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12 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

(b> While under suspension, a member shall not be entitled to
exercise any rights under this Agreement except the right of with-
drawal, but shall remain subject to all obligations.

SECCION 3. Suspension or Cessation of Membership in :he Bank
Any member which is suspended from membership in, or ceases to

be a member of, the Bank shall automatically be suspended from
membership in, or cease to be a member of. the Corporation, as the
case may be.

SECTION 4. Rights and Duties of Governments Ceasing to be

(a) When a government ceases to be a member it shall remain
liable for all amounts due from it to the Corporation. The Corpora-
tion shall arrange for the repurchase of such government's capital
stock as a part of the settlement of amounts with it in accordance
with the provisions of this section, but the government shall have no
other rights under this Agreement except as provided in this section
and in Article W I (c).

(b) The Corporation and the government may agree on the repur-
chase of the capital stock of the government on such terms as may
be appropriate under the circumstances, without regard to the pro-
visions of paragraph (c) below. Such agreement may provide, among
other things, for a final settlement of all obligations of the govern-
ment to the Corporation.

(c) If such agreement shall not have been made within six months
after the government ceases to be a member or such other time as
the Corporation and such government may agree. the repurchase
price of the government's capital stock shall be the value thereof
shown by the books of the Corporation on the day when the govern-
ment ceases to be a member. The repurchase of the capital stock
shall be subject to the following conditions:

(i) payments for shares of stock may be made from time to
time, upon their surrender by the government, in such instal-
ments, at such times and in such available currency or
currencies as the Corporation reasonably determines, taking
into account the financial position of the Corporation:

(ii) any amount due to the government for its capital stock shall
be withheld so long as the government or any of its agencies
remains liable to the Corporation for payment of any amount
and such amount may, at the option of the Corporation. be
set off. as it becomes payable, against the amount due from
the Carpmation:

(iii) if the Corporation sustams a net loss on the investments made
pursuant to Article III. section 1, and held by it on the date
when the government ceases to be a member. and the

Members

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amonnt of such loss exceeds the amount of the reserver
provided therefor on such date, such government shall repay
on demand the amount by which the repurchase price of ils
shares of stock would have been reduced if such loss had
been taken into account when the repurchase price was
determined.

(d) In no event shall any amount due to a government for its
capital stock under this section he paid until six months after the
date upon which the government ceases to he a member. If within
six months of the date upon which any government ceases to be a
memher the Corporation suspends operations under section S of this
Article, all rights of such government shall be determined by the
provisions of such section 5 and such government shall be considered
sti l l a member of the Corporation for purposes of such section 5,
except that it shall have no voting rights.

SECTION 5. Suspension of Operations and Settlement of Obligations
(a) The Corporation may permanently suspend its operations by

vote of a majority of the Governors exercising a majority of the total
voting pwer . After such suspension of operations the Corporation
shall forthwith cease all activities, except those incident to the orderly
realization, conserfation and preservation of its assets and settlement
of its obligations. Until final settlement of such obligations and dis-
tribution of such assets. the Corporation shall remain in existence and
all mutual rights and obligations of the Corporation and its members
under this Agreement shall continue unimpaired. except that no
member shall be suspended or withdraw and that no distribution shall
he made to members except as in this section provided.

(6) No distribution shall he made to members on account of their
subscriptions to the capital stock of the Corporation until all liabilities
to creditors shall have been discharged or provided for and until the
Board of Governors. by vote of a majority of the Governors exercising
a majority of the total voting power, shall have decided to make such
distribution.

(c) Subject to the foregoing. the Corporation shall distribute the
assets of the Corporation to members pro rata in proportion to capital
stock held by them, subject, in the case of any member, to prior
settlement of all outstanding claims by the Corporation against such
member. Such distribution shall he made at such times, in such
currencies, and in cash or other assets as the Corporation shall deem
fair and equitable. The shares distributed to the several members
need not necessarily be uniform in respect of the type of assets dis-
tributed or of the currencies in which they are expressed.
(4 Any member receiving assets distributed by the Corporation

pursuant to this section shall enjoy the same rights with respect to
such assets as the Corporation enjoyed prior to their distribution.

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14 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

hT1CI.E

Status, Immunifies and Privileges
SECTION 1. Purposes of Article
To enable the Corporation to fnl6l the functions with which it is

entrusted, the status, immunities and privileges set forth in this
Article shall be accorded to the Corporation in the territories of each
member.

SECTION 2. Status of the Corporufion
The Corporation hal l possess full juridical personality and, in parti-

cilar, the capacity:
(i) to contract:
(ii) to acquire and dispose of immovable and movable property:

(iii) to institute legal proceedings.

SLCTIOX 3. Position of fhe Corporation with regard to Jirdicid

Actions may be brought against the Corporation only in a wurt of
competent jurisdiction in the territories of a member in which the
Corporation has an office, has appointed an agent for the purpose of
accepting service or notice of process, or has issued or guaranteed
securities. No actions shall, however, be brought by members or per-
sons acting for or deriving claims from members. The property and
assets of the Corporation shall, wheresoever located and by whomso-
ever held, be immune from all forms of seizure. attachment or execu-
tion before the delivery of h a 1 judgment against the Corporation.

Process

SECTION 4. Immunity of Assets from Seizure
Property and assets of the Corporation, wherever located and by

whomsoever held. shall be immune from search, requisition, wnfisca-
tion, expropriation or any other form of seizure by executive or legis-
lative action.

SBC~ION 5. Immunity of Archives
The archives of the Corporation shall be inviolable.
SECTION 6. Freedom of Assets from Restricfions
To the extent necessary to carry out the operations provided for in

this Agreement and subject to the provisions of Article IU, section 5 .
and the other provisions of this Agreement, all property and assets of
the Corporation shall be free from restrictions, regulations, controls
and moratoria of any nature.

S-ON 7 . Privilege for Communicafiom
The official communications of the Corporation shall be accorded by

each member the same treatment that it accords to the official wm-
munications of other members.

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INTERNATIONAL FINANCE CORPORATION
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SECXION 8. lmmunities and Privileges of O@cers and employees
All Governors, Directors, Alternates, officers and employees of the

Corporation :
(i) shall be immune from legal process with respect to acts per-

formed by them in their official capacity;
(ii) not being local nationals, shall he accorded the same

immunities from immigration restrictions, alien registration
requirements and national service obligations and the same
facilities as regards exchange restrictions as are accorded by
members to the representatives, officials, and employees of
comparable rank of other members:

(iii) shall be granted the same treatment in respect of travelling
facilities as is accorded by members to representatives, o5cials
and employees of wmparable rank of other members.

SECTION 9. Immunities from Taxation
(Q) The Corporation, its assets, property, income and its operations

and transactions authorized by this Agreement, shall he immune from
all taxation and from all customs duties. The Corporation shall also
be immune from liability for the wllection or payment of any tax or
duty.

(b) No tax shall be levied on or in respect of salaries and emolu-
ments paid by the Corporation to Directors, Alternates, officials or
employees of the Corporation who are not local citizens, local subjects.
or other !oml nationals.

(c) No taxation of any kind shall be levied on any obligation or
security issued by the Corporation (including any dividend or interest
thereon) by whomsoever held :

(i) which discriminates against such obligation or security solely
because it is issued by the Corporation: or

(ii) if the sole jurisdictional basis for such taxation is the place
or currency in which it is issued, made payable or paid. or
the location of any ofice or place of business maintained by
the Corporation.

(4 No taxation of any kind shall be levied on any obligation or
security guaranteed by the Corporation (including any dividend or
interest thercon) by whomever held :

(i) which discriminates against such obligation or security solely
because it is guaranteed by the Corporation; or

(ii) if the sole jurisdictional basis for such taxation is the location
of any 05ce or place of business maintained by the Corpora-
tion.

SBcnON 10. Application of Article
Each member shall take such action as is necessary in its own

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15

16 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

territories for the purpose of making effective in terms of its own law
the principles set forth in this Article and shall inform the Corpora-
tion of the detailed action which it has taken.
SECTION 11. Waiver
The Corporation in its discretion may waive any of the privileges

and immunities conferred under this Article to such extent and upon
such conditions as it may determine.

ARTICLE W
Amendmeas

(0) This Agreement may be amended by vote of three-fiftbs of the

(b) Notwithstanding paragraph (a) above, the affirmative vote of all

(i) the right to withdraw from the Corporation provided in

(ii) the pre-emptive right secured by Article 11, section 2 (d):
(iii) the. limitation on liability provided in Article 11, section 4.

(c) Any proposal to amend this Agreement, whether emanating
from a member. a Governor or the Board of Directors, shall be com-
municated to the Chairman of the Board of Governors who shall bring
the proposal before the Board of Governors. When an amendment
has been duly adopted, the Corporation shall so certify by formal
communication addressed to all members. Amendments shall enter
into force for al l members three months after the date of the formal
communication unless the Board of Governors shall specify a shorter

Governors exercising four-CSths of the total voting power.

Governors is required in the case of any amendment modifying:

Article V. section 1;

period

ARTICLE W I
InIerpretation and Arbitration

(a) Any question of interpretation of the provisions of this Agree-
ment arising between any member and the Corporation or between
any members of the Corporation shall be submitted to the Board of
Duectors for its decision. If the question particularly affects any
member of the Corporation not entitled to appoint an Executive
Director of the Bank, it shall be entitled to representation in accord-
ance with Article IV, section 4 (9).

(b) In any case where. the Board of Directors has given a decision
under (a) above, any member may require that the question be referred
to the Board of Governors, whose decision shall be final. Pending
the result of the reference to the Board of Governors, the Corporation
may, so far as it deems necessary. act on the basis of the decision of
the Board of Directors.

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INTERNATIONAL FINANCE CORPORATION
AGREEMENT

17

(c) Whenever a disagreement arises between the Corporation and
a country which has ceased to be a member, or between the Corpora-
tion and any member during the permanent suspension of the Cor-
poration, such disagreement shall be submitted to arbitration by a
tribunal of three arbitrators, one appointed by the Corporation, another
by the country involved and an umpire who, unless the parties other-
wise agree, shall be appointed by the President of the International
Court of Justice or such other authority as may have been prescribed
by regulation adopted by the Corporation. The umpire shall have full
power to settle all questions of procedure in any case where the parties
are in disagreement with respect thereto.

h T I C L E Ix
Final Provisions

SECITON 1. Entry into Force
This Agreement shall enter into force when it has been signed on

behalf of not less than 30 governments whose subscriptions comprise
not less than 75 percent of the total subscriptions set forth in Schedule
A and when the instruments referred to in section 2 (a) of this Article
have been deposited on their behalf, but in no event shall this Agree-
ment enter into force before October 1, 1955.

SECTION 2. Sigwture
(a) Each government on whose behalf this Agreement is signed shall

deposit with the Bank an instrument setting forth that it has accepted
this Agreement without reservation in accordance with its law and
has taken all steps necessary to enable it to carry out all of its
obligations under this Agreement.

(b) Each government shall become a member of the Corporation
as from the date of the deposit on its behalf of the instrument referred
to in paragraph (a) above except that no government shall become
a member before this Agreement enters into force under section 1 of
this Article.

(c) This Agreement shall remain open for signature until the close
of business on December 31, 1956, at the principal office of the Bank
on behalf of the governments of the countries whose names are set
forth in Schedule A.
(d) Afm this Agreement shall have entered into force, it shall be

open for signature on behalf of the government of any country whose
membership has been approved pursuant to Article Iz, section 1 (b).

SECTION 3. Inauguration of the Corporation
(U) As soon as this Agreement enters into force under section 1

of this Article the Chairman of the Board of Directors shall call a
meeting of the Board of Directors.

_ _
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18 INTERNATIONAL FINANCE CORPORATION
AGREEMENT

(b) The Corporation shall begin operations on the date when such
meeting is held.

(c) Pending the first meeting of the Board of Governors, the Board
of Directors may exercise all the powers of the Board of Governors
except those reserved to the Board of Governors under this Agree-
ment.

Done at Washington, in a single copy which shall remain deposited
in the archives of the International Bank for Reconstruction and
Development, which has indicated by its signature below its agree-
ment to act as depository of this Agreement and to notify all govern-
ments whose names are set forth in Schedule A of the date when
this Agreement shall enter into foroe under Article IX. section 1
hereof.

&HEDULB A
Subscriptionr to Capital Stock of the International Finnnce

Corporatwn
Amount

Nuniber of (in United
camwy Shares States doliars)

Ausiralia 2,215 2,215,000
Austria 554 554.000
BClgiUm 2,492 2,492,000
Bolivia I8 78,000
Brazil 1,163 1,163,000
BUnna 166 166,000
Canada 3.600 3*MX).000
Ceylon 166 166,000
Chile 388 388.000
China 6.646 6,646,000
Colombia 388 388,000
costa Rica 22 22,OOo
Cuba 388 388.000
Denmak 753 753.000
Dominican Republic 22 22.000
Ecuador 35 35.000

- -

~ ~~~ ~~

E m t
El Salvador
Ethiopia
Finland
FI2ln.X
GeITlIany
Greece
Guatemala
Haiti
Honduras

[The inclusion

590
11
33

411
5,815
3,655

277
22
22
11

of this page is authorized

590;oOO
11.Ooo
33;OOO

421,000
5.815.000
3,655,000

277,000
22,000
2 2 . m

by LN. 480119731

INTERNATIONAL FINANCE CORPORATION
AGREEMENT

SCHEDULE A, confd.

19

Country
Nuniber of

Shares

Iceland
India
Indonesia
Iran
Iraq
Israel
Italy
Japan
Jordan
Lebanon
Luxembourg
Mexico
Netherlands
Nicaragua
Norway
Pakistan
Panama
Paraguay
Peru
Philippines
Sweden
Syria
Thailand
Turkey
Union of South Africa
United Kingdom
United States
Uruguay
Venezuela
Yugoslavia

Total :

11
4,431
1,218
372
67
50

1.994
2,769

33
50

1 1 1
720

3,046
9

554
1.108

2
16
194
166

1.108
72
139
4 76

1.108
14,400
35.168

116
116
443

100,000
-

Amount
(in United

Stares dollars)

11,000
4.43 1.000
I.ZI8.000
372.000
67.000
5O.OOO

1.994.000
2.769.000

33.000
50.000

1 I1.000
720.000

3,046.000
9.000

554.000
1,108.000

2 .ooo
16.000
194.000
166.000

1,108.000
72.000
139.000
4761000

1,108.OOO
14.400.000
35.168.000

I 16.000
I 16.000
443,000

$100.000.000

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[The inclusion of this page is authorized by L.N. 480119731
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