Through Which The "agreement Establishing The Multilateral Investment Guarantee Agency" Approved, Done At Washington On May 25, 1986

Original Language Title: Por medio de la cual se aprueba el "Convenio Constitutivo del Organismo Multilateral de Garantía de Inversiones", hecho en Washington el 25 de mayo de 1986

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ACT 149 OF 1994

(July 15)

Official Journal No. 41.450 of 19 June 1994

By means of which the "Constitutional Convention of the Multilateral Investment Guarantee Agency" is approved, made in Washington on May 25, 1986.

THE CONGRESS OF COLOMBIA,

Having regard to the text of the "Constitutional Convention of the Multilateral Investment Guarantee Agency", made in Washington on 25 May 1986, which reads:

Multilateral Investment Guarantee Agency

MULTILATERAL BODY CONVENTION

INVESTMENT GUARANTEE

Presented to Governments by the Board of Governors

of the International Bank for Reconstruction and Development.

October 11, 1985

PREAMBLE

Contracting States

Whereas it is necessary to strengthen international cooperation for economic development and to promote the contribution of foreign investment in general and private foreign investment in particular to such development;

Acknowledging that mitigation of non-commercial risk-related concerns would facilitate and enhance the flow of foreign investment to developing countries;

Eager to improve the flow to developing countries of capital and technology for productive purposes in conditions compatible with their development needs, policies and objectives, on the basis of fair and stable standards for the treatment of foreign investment;

Convinced that the Multilateral Investment Guarantee Agency can play an important role in encouraging foreign investment by complementing national and regional investment guarantee programmes and the activities of private insurers of non-commercial risks, and

Recognising that such a body, to the extent possible, must fulfil its obligations without recourse to its capital required and that the continued improvement of the conditions for investments would contribute to such an objective,

Have agreed to the following:

CHAPTER I.

CREATION, LEGAL NATURE, PURPOSES, AND DEFINITIONS

ARTICLE 1o. ESTABLISHMENT AND LEGAL NATURE OF THE BODY.

(a) By this agreement the Multilateral Investment Guarantee Agency (hereinafter referred to as the Agency) is hereby established.

(b) The Agency shall have full legal personality and, in particular, capacity to:

i) Hire;

ii) Acquire and dispose of movable and immovable property;

iii) Open court proceedings.

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ARTICLE 2o. OBJECTIVE AND OBJECTIVES. The objective of the Agency will be to encourage the flow of investments for productive purposes among the member countries, and in particular towards the developing member countries, thus complementing the activities of the Bank International for Reconstruction and Development (hereinafter referred to as the Bank) and the International Finance Corporation and other international development finance institutions.

In order to meet your goal, the Agency:

(a) Grant guarantees, including co-insurance and reinsurance, against non-commercial risks in respect of investments made in a member country and from other member countries;

b) It will carry out appropriate complementary activities to promote the flow of investments to and among developing member countries, and

(c) Shall exercise all other concomitant powers that are necessary or desirable for the achievement of its objective.

In all its decisions, the Body will be governed by the provisions of this article.

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ARTICLE 3o. DEFINITIONS. For the purposes of this Convention:

(a) "Member" means a State in respect of which this Convention has entered into force in accordance with Article 61.

(b) "receiving country" or "receiving government" means a member, its government, or a public dependency of a member on whose territory, as defined in Article 66, an investment which has been secured or re-insured by the Body or that the Agency is considering to guarantee or to reassure.

(c) "developing member country" means a member of the Body designated as such in Appendix A to this Convention including any amendments to that Appendix which it makes from when the Board of Governors referred to in this Convention in Article 30 (hereinafter referred to as the Council).

(d) "Special Majority" means the affirmative vote of no less than two-thirds of the total voting rights representing no less than fifty-five percent of the shares subscribed to the capital of the Agency.

e) "free use currency" means (i) a currency thus designated from time to time by the International Monetary Fund and (ii) any other currency that can be freely obtained and used effectively, than the Board of Directors to which it is made a reference to Article 30 (hereinafter referred to as the Board) for the purposes of this Convention, after consultation with the International Monetary Fund and with the approval of the country issuing the said currency.

CHAPTER II.

MEMBERS AND CAPITALS

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ARTICLE 4. MEMBERS.

a) Members of the Agency may be members of the Bank and Switzerland.

b) The founding members of the Agency shall be the States designated in Appendix A to this Convention and shall be parties to it on or before 30 October 1987.

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ARTICLE 5o. CAPITAL.

(a) The authorised capital of the Agency shall be one billion special drawing rights (SDR 1,000,000,000). The authorised capital shall be divided into 100,000 shares with a nominal value of SDR 10,000 each, which shall be made available to the members for subscription purposes. All the obligations for the payment of the members in respect of the authorised capital shall be met on the basis of the average value of the SDR in terms of the dollar of the United States of America in the period from 1 January 1981 to 30%. June 1985, a value of 1,082 dollars from the United States of America for each SDR.

(b) When a new member is admitted, the authorised capital shall be increased to the extent that the number of shares authorised at that time is insufficient to provide the shares to be subscribed by that member in accordance with the Article 6.

(c) The Council, acting by a special majority, may increase the authorised capital of the Agency at any time.

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ARTICLE 6o. SUBSCRIPTION OF SHARES. Each founding member of the Agency shall subscribe to the nominal value the amount of capital stock that is stipulated in accordance with its name in Appendix A to this Convention. All other members shall take capital shares in the number and in the terms and conditions which the Council determines, but in no case at a lower emission price than the nominal value. No member shall subscribe to less than 50 shares.

The Board will prescribe the rules under which members will be able to subscribe to additional shares of the authorized capital.

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ARTICLE 7o. DIVISION AND REQUIREMENTS FOR PAYMENT OF SUBSCRIBED CAPITAL. The initial subscription of each member shall be paid in the following form:

i) Within 90 days of the date on which this Convention enters into force in respect of each member, ten per cent of the price of each share shall be paid in cash in accordance with Section (a) of Article 8 and 10 per cent. an additional percentage in the form of non-marketable promissory notes that do not accrue interest or similar obligations to be made effective in accordance with a decision of the Board in order to satisfy the obligations of the Agency.

(ii) The balance shall be subject to payment at the request of the Agency where necessary to meet its obligations.

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ARTICLE 8o. PAYMENT FOR THE ACTION SUBSCRIPTION.

a) The payments of subscriptions will be made in free-use currencies; however, developing member countries will be able to pay in their own currencies up to twenty-five percent of the cash portion of the paid capital of their subscriptions. payable in accordance with Article 7 (i).

b) The requirements of any portion of unpaid subscriptions will be uniform for all shares.

(c) If the amount received by the Agency by reason of a requirement is insufficient to satisfy the obligations that have necessitated the requirement, the Agency may make successive additional requirements of the unpaid subscriptions until the total amount received is sufficient to satisfy such obligations.

d) Responsibility for the shares will be limited to the unpaid portion of the issue price.

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ARTICLE 9o. VALUATION OF CURRENCIES. For the purposes of this Convention, whenever it is necessary to determine the value of a currency on the basis of another currency, such value shall be as reasonably determined by the Agency, after consultation with the International Monetary Fund.

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ARTICLE 10. REFUNDS.

(a) As soon as possible, the Agency shall reimburse the members for the amounts paid by them for the purpose of the subscribed capital requirement if the following conditions are met and to the extent that they are met:

i) that the requirement has been made to satisfy a claim arising from a reinsurance guarantee or contract and that after the Agency has recovered its payment in whole or in part, in free currency, or

(ii) that the requirement has been made in respect of non-compliance with the payment by a member and subsequently that member has made the payment in whole or in part, or

iii) That the Council, by a special majority, determine that the financial situation of the Agency allows such amounts to be repaid in all or part of the Agency's revenue.

b) Any refund to a member under this article shall be made in free currency in the proportion corresponding to the payments made by that member in the total amount paid in accordance with the requirements made before such reimbursement.

(c) The equivalent of the amounts reimbursed to a member under this Article shall become part of the capital obligations of the member in accordance with Article 7 (ii).

CHAPTER III.

OPERATIONS

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ARTICLE 11. RISKS COVERED.

(a) Subject to the provisions of Sections (b) and (c) below, the Agency may ensure eligible investments against a loss resulting from one or more of the following types of risks:

i) Currency transfer.

The introduction attributable to the receiving government of any restrictions on the transfer to the outside of the receiving country of its currency in a free currency or other currency acceptable to the holder of the guarantee, including the lack of action by the receiving government, within a reasonable period, in respect of a request for such a transfer holder;

ii) Expropriation and similar measures.

Any legislative action or any administrative action or omission attributable to the receiving government that has the effect of depriving the holder of a guarantee of ownership or control of its investment or of a substantial benefit derived from the with the exception of non-discriminatory measures of general application which governments normally take in order to regulate economic activity in their territories;

iii) Contract breach.

Any rejection or non-compliance by the receiving government of a contract with the holder of a guarantee, when (a) the holder of a guarantee has no recourse to a court or arbitration court in order to resolve the rejection claim or non-compliance, or (b) such a forum does not dictate a decision within a reasonable period within the meaning of the requirements of the guarantee contracts in accordance with the regulations of the Agency, or (c) such a decision cannot be enforced, and

iv) War and civil unrest.

Any military action or civil disturbance in any territory of the receiving country to which this Convention applies in accordance with Article 66.

(b) By virtue of a joint request of the investor and the receiving country, the Board, by a special majority, may approve the extension of the coverage under this Article to specific non-commercial risks other than those covered by the Section a) above, but in no case to the risks of devaluation or depreciation of the currency.

c) Losses resulting from the following shall not be covered:

i) Any action or omission of the receiving government to which the holder of the guarantee has given his consent or by which he is responsible, and

ii) Any action or omission of the receiving government or any other event occurring prior to the conclusion of the warranty contract.

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ARTICLE 12. ELIGIBLE INVESTMENTS.

(a) Eligible investments shall include contributions to social capital, including medium-or long-term loans granted or guaranteed by the holders of shares in the social capital of the undertaking concerned, and the forms of direct investment that the board can determine;

(b) The Board, by a special majority, may extend eligibility to any other form of medium-or long-term investment, unless loans other than those referred to in Section (a) above may be eligible only if they are linked to a specific investment guaranteed or proposed to be covered by the Agency's guarantee;

(c) The guarantee shall be restricted to those investments whose execution begins after the Agency has registered the request for such guarantee. Such investments may include:

i) Currency transfers made to modernize, expand or develop an existing investment, and

ii) The use of income from existing investments that otherwise could be referred to outside the recipient country.

d) When securing an investment, the Agency shall be satisfied with the following:

i) The economic solvency of the investment and its contribution to the development of the recipient country;

(ii) Legal investment in accordance with the laws and regulations of the receiving country;

iii) The harmony of investment with the stated goals and priorities of the recipient country, and

iv) The conditions for investments in the receiving country, including the availability of fair and equitable treatment and legal protection for investment.

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ARTICLE 13. QUALIFYING INVESTORS.

(a) Any natural person and any legal person may fulfil the conditions required to receive the Agency's guarantee, provided that:

i) The natural person is a national of a member country other than the recipient country;

(ii) the legal person has been established and has the seat of his business in a member country or the majority of his/her capital is owned by one or more member countries or nationals of the member (s), provided that in none of these cases in that Member State is in turn the recipient country, and

iii) The legal person, whether privately owned or not, works in commercial terms;

(b) If the investor has more than one nationality, for the purposes of Section (a) above, the nationality of a member shall prevail over the nationality of a non-member country, and the nationality of the receiving country shall prevail. on the nationality of any other member;

(c) By virtue of the joint application of the investor and the recipient country, the Board, by a special majority, may extend the admissibility to a natural person who is a national of the receiving country or to a legal person who has been established in the receiving country or whose capital is mostly owned by its nationals, provided that the assets in question are transferred from outside the receiving country.

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ARTICLE 14. ELIGIBLE RECIPIENT COUNTRIES. Investments shall be guaranteed under this Chapter only if they are to be made in the territory of a developing member country.

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ARTICLE 15. APPROVAL OF THE RECEIVING COUNTRY. The Agency shall not conclude a guarantee contract before the receiving government has approved the granting of the guarantee by the Agency against the risks the coverage of which has been specified.

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ARTICLE 16. TERMS AND CONDITIONS. The terms and conditions of each warranty contract shall be determined by the Agency subject to the rules and regulations dictated by the Board, with the understanding that the Agency shall not cover the total loss of the guaranteed investment. Warranty contracts will be approved by the President under the direction of the Board.

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ARTICLE 17. PAYMENT OF CLAIMS. The President, under the direction of the Board, shall decide on the payment of claims to the holder of a guarantee in accordance with the guarantee contract and the policies that the Board adopts. The guarantee contracts shall require the holders of guarantees, before the Agency makes a payment, to establish the appropriate administrative resources under the circumstances, provided that they are promptly available to them. compliance with the laws of the receiving country. Such contracts may require the passage of certain reasonable periods between the occurrence of the events that result in the claims and the payments of these.

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ARTICLE 18. SUBROGATION.

(a) By paying or agreeing to pay compensation to the holder of a guarantee, the Agency shall be subrogated to the rights or claims related to the guaranteed investment that the holder of a guarantee may have had against the receiving country and others obliged. The warranty contract will stipulate the terms and conditions of such subrogation;

(b) The rights of the Agency under Section (a) above shall be recognized by all members;

(c) The recipient country shall give the amounts expressed in its own currency, acquired by the Agency as a subrogant under Section (a) above, such a favourable treatment as to its use and conversion as the treatment it would have corresponding to such funds in the hands of the security holder. In any event, the Agency may use such amounts for the payment of its administrative costs and other costs. The Agency shall also seek to conclude agreements with recipient countries on other uses of such currencies as long as they are not free to use.

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ARTICLE 19. RELATIONS WITH NATIONAL AND REGIONAL BODIES. The body shall cooperate with the national entities of the member countries and regional entities whose capital is most of the ownership of the member countries, which they carry out similar activities of the Agency, and shall seek to complement the operations of such entities, in order to maximise both the efficiency of their respective services and their contribution to the increase in the flow of foreign investments. To this end, the Agency may conclude contractual arrangements with those entities concerning the details of such cooperation, including in particular the modalities of reinsurance and co-insurance.

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ARTICLE 20. REINSURANCE OF NATIONAL AND REGIONAL ENTITIES.

(a) The Agency may provide reinsurance, in respect of a specific investment, against losses arising from one or more of the non-commercial risks that would have been guaranteed by a member or a dependency of the same or an entity. regional investment guarantee, the largest portion of which is owned by two or more members. The Board, acting by a special majority, shall determine from time to time the maximum amount of the contingent obligations that the Agency may assume in respect of reinsurance contracts. With regard to specific investments which have been completed more than 12 months before the Agency receives the reinsurance application, the maximum amount shall initially be set at 10% of the total of the contingent obligations. of the Body according to this Chapter. The eligibility conditions specified in Articles 11 to 14 shall apply to reinsurance operations, unless it is not necessary for the reinsurance investments to be carried out after the request for reinsurance.

(b) The mutual rights and obligations of the Agency and a reinsured member or dependency shall be specified in the reinsurance contracts subject to the rules and regulations of reinsurance that the Board dictates. The Board shall approve each reinsurance contract that guarantees an investment that has been made before the Agency receives the request for reinsurance, with a view to minimising the risks, ensuring that the Agency receives premiums that it provides (a) proportion to its risks, and the re-insured entity to be adequately committed to the promotion of new investments in developing member countries.  

(c) To the extent possible, the body shall ensure that it and the reinsured entity correspond to the rights of subrogation and arbitration equivalent to those that the Agency would have if it had been the original guarantor. Reinsurance terms and conditions shall require that administrative actions be initiated in accordance with Article 17 before the Agency makes a payment. The subrogation shall take effect with respect to the receiving country concerned only after its approval of the reinsurance by the Agency. The Agency shall include in the reinsurance contracts provisions requiring that the reinsurer procure with due diligence to enforce the rights or claims related to the re-insured investment.

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ARTICLE 21. COOPERATION WITH PRIVATE INSURERS AND REINSURERS.

(a) The Agency may conclude agreements with private insurers in the Member States in order to intensify their own operations and to encourage such insurers to cover non-commercial risks in the Member States in the development under conditions similar to those applied by the Agency. Such agreements may include reinsurance by the Agency in accordance with the conditions and procedures specified in Article 20;

(b) The Agency may reassure with any appropriate reinsurance entity, in whole or in part, the guarantee or guarantees for the granted;

(c) The Agency shall in particular seek to ensure investments for which comparable coverage of private insurers and reinsurers is not available on reasonable terms.

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ARTICLE 22. WARRANTY LIMITS.

(a) Unless otherwise determined by the Council by a special majority, the total amount of contingent obligations that the Agency may assume under this Chapter shall not exceed a hundred and fifty percent of the amount of the the subscribed capital free of charge of the Agency and its reserves plus the portion of reinsurance cover that the Board determines.

The Board, from time to time, will examine the risk profile of the Agency's portfolio based on its experience in claims, the degree of risk diversification, reinsurance coverage and other relevant factors, with the purpose of determining whether to recommend to the Council the modification of the maximum total amount of contingent obligations. In no case shall the maximum amount determined by the Council exceed five times the amount of the subscribed capital free of charge of the Agency, its reserves and the portion of its reinsurance coverage deemed appropriate;

(b) Without prejudice to the general limit of security referred to in Section (a) above, the Board may determine:

i) total amounts of contingent obligations that may be assumed by the Agency in accordance with this Chapter for all guarantees granted to the investors of each member. In determining such maximum amounts, the Board shall give due consideration to the proportional participation of the respective member in the capital of the Agency and the need to apply more liberal limitations with respect to investments which originate in developing member countries, and

(ii) maximum total amounts of contingent obligations which may be assumed by the Agency with respect to risk diversification factors, such as individual projects, individual recipient countries and classes of investment or risk.

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ARTICLE 23. PROMOTION OF INVESTMENTS.

a) The body will conduct research, undertake activities to promote investment streams and disseminate information on investment opportunities in developing member countries, in order to improve conditions for investment. foreign investment flows to these countries. The Agency may, at the request of a member, provide advice and technical assistance in order to improve the conditions for investments in the territories of that member. When performing these activities, the Agency:

i) shall be guided by relevant investment agreements concluded between member countries,

ii) will seek to remove impediments, both in developed and developing countries, to the investment stream towards developing member countries, and

iii) will coordinate its activities with those of other entities interested in the promotion of foreign investment and in particular the International Finance Corporation;

b) In addition, the body:

i) will encourage the amicable settlement of differences between investors and recipient countries,

(ii) shall endeavour to conclude, subject to the approval of the Board by a special majority, agreements with the developing member countries, in particular with the potential recipient countries, in which it is ensured that the Agency has, with respect to investments by the guarantee, a treatment at least as favourable as the one agreed by the member concerned, in an investment agreement, the investment guarantee entity or the most favoured State, and

iii) promote and facilitate the conclusion of agreements among its members on the promotion and protection of investments;

c) The Agency shall pay particular attention to its promotional activities to the importance of increasing the flow of investments between developing member countries.

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ARTICLE 24. GUARANTEES OF SPONSORED INVESTMENTS. In addition to the guarantee operations that the Agency is responsible for under this Chapter, the Agency may guarantee investments under sponsorship agreements as set out in Annex I of this Chapter. Convention.

CHAPTER IV.

FINANCIAL PROVISIONS

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ARTICLE 25. FINANCIAL ADMINISTRATION. The Agency shall carry out its activities in accordance with sound business practices and prudent financial management practices with the aim of maintaining in all circumstances its capacity to attend to its activities. financial obligations.

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ARTICLE 26. PREMIUMS AND COMMISSIONS. The Agency shall periodically fix and examine the level of premiums, commissions and other charges, if any, applicable to each class of risk.

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ARTICLE 27. DISTRIBUTION OF NET INCOME.

(a) Without prejudice to Section (a) (iii) of Article 10, the Agency shall allocate the net proceeds to the reserves until they reach an amount equal to five times the subscribed capital of the Agency;

(b) After the Agency's reserves have reached the level prescribed in Section (a) above, the Council shall determine whether the Agency's net income is to be allocated to the reserves, or to be distributed among the members of the Agency, and to what extent, or otherwise use. Any distribution of the net income to the members of the Agency shall be made in proportion to the participation of each member in the capital of the Agency in accordance with the decision of the Council by a special majority.

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ARTICLE 28. BUDGET. The President will prepare an annual revenue and expenditure budget of the Agency for approval by the Board.

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ARTICLE 29. Agency shall publish an Annual Report which shall include the statements of its accounts and the accounts of the Atrocity Trust Fund referred to in Annex I of the Convention, as verified by independent auditors. The Agency shall distribute to the members, at appropriate intervals, a summary statement of its financial position and a statement of profit and loss indicating the results of its operations.

CHAPTER V.

ORGANIZATION AND ADMINISTRATION

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ARTICLE 30. STRUCTURE OF THE ORGANISM. The Agency shall have a Board of Governors, a Board of Directors, a President and officials who shall comply with the obligations that the Agency determines.

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ARTICLE 31. THE COUNCIL.

(a) All the powers of the Agency shall reside in the Council, except those which, in accordance with the terms of this Convention, are specifically entrusted to another body of the Agency. The Board may delegate to the Board the exercise of any of its powers, with the following exceptions:

i) the ability to admit new members and determine the conditions of admission,

ii) the ability to suspend a member,

iii) the ability to decide an increase or decrease in capital,

(iv) the power to raise the limit of the total amount of the contingent obligations in accordance with Article 22 (a),

v) the power to designate a member as a developing member country in accordance with Section c) of Article 3o.,

vi) the ability to classify a new member as a member of Category One or Category Two for voting purposes in accordance with Section 39, or to reclassify an existing member for the same purposes,

vii) the ability to determine the remuneration of the Directors and their Substitutes,

viii) the ability to terminate operations and dissolve the Agency,

ix) the ability to distribute assets to members after settlement, and

x) the power to reform this Convention, its Annexes and Appendices;

(b) The Council shall be composed of a Governor and a Substitute appointed by each member in the manner in which the Council determines. No alternate may vote, except in the absence of his principal. The Board shall select one of the Governors as its Chairman;

c) The Council shall hold an annual meeting and any other meetings which the Council itself determines or which the Board may convene. The Board shall convene a meeting of the Council whenever it is requested by five members or by members who have twenty-five percent of the total voting rights.

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ARTICLE 32. THE BOARD OF DIRECTORS.

(a) The Board shall be responsible for the general operations of the Agency, and in compliance with this responsibility, shall take all measures necessary or permitted under this Convention.

b) The Board shall consist of no less than twelve Directors. The Council may adjust the number of Directors in order to take account of changes in the number of members of the Agency. Each Director may appoint a Substitute with full powers to act on his behalf in the event of absence or incapacity. The President of the Bank shall be ex officio president of the Board, but shall not have the right to vote except in the case where a vote is required, if there is equal results in a vote;

c) The duration of the duties of the Directors shall be determined by the Council. In its inaugural session, the Council shall be the first Board;

(d) The Board shall meet when convened by its Chairman, either on his own initiative or at the request of three Directors;

e) Until when the Board decides that the Body has a resident Board that works on a continuous basis, the Directors and Substitutes shall receive remuneration only for the cost of attending to the Board meetings and the compliance of other official functions on behalf of the Agency. Once a Board is established with continuous functions, the Directors and Substitutes may receive the remuneration to be determined by the Board.

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ARTICLE 33. PRESIDENT AND OFFICIALS.

(a) Under the general supervision of the Board, the President shall deal with the ordinary affairs of the Agency. He will be responsible for the organization and appointment and removal of officials;

b) The President shall be appointed by the Board on the proposal of its chairman. The Council shall determine the remuneration and terms of the President's service contract;

(c) In the performance of their duties, the President and the officials shall be obliged to the Agency in full and shall have no commitment in respect of any other authority. Each member of the Agency shall respect the international character of this obligation and shall refrain from trying to influence the President or the officials in the performance of their duties;

(d) By appointing officials and staff, the President, subject to the overriding interest of ensuring the highest standards of efficiency and technical competence, shall pay due attention to the importance of the recruitment of staff in the wider geographical scope possible;

e) The President and the officials and employees shall maintain at all times the confidential nature of the information obtained in conducting the operations of the Agency.

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ARTICLE 34. PROHIBITION OF POLITICAL ACTIVITIES. Neither the Agency nor its officials shall interfere in the political affairs of any member. Without prejudice to the right of the Agency to take into account all circumstances around an investment, the decisions of the Agency and its officials shall not be influenced by the political character of the member or members concerned. The considerations relevant to its decisions shall be impartially weighted in order to achieve the purposes laid down in Article 2.

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ARTICLE 35. RELATIONS WITH OTHER INTERNATIONAL BODIES. The Agency, under the terms of this Convention, shall cooperate with the United Nations and other intergovernmental bodies with specialized responsibilities in the field of related fields, including in particular the Bank and the International Finance Corporation.

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ARTICLE 36. LOCATION OF THE HQ.

a) The Agency's headquarters will be in the city of Washington, unless the Council, by a special majority, decides to place it elsewhere;

b) The Agency may establish other offices as necessary in relation to its work.

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ARTICLE 37. ASSET DEPOSITARIES. Each member shall designate its central bank as a depositary where the Agency may hold holdings in the currency of that member or other assets of the Agency or, in the absence of a central bank, shall designate such a central bank. end to another institution that is acceptable to the Body.

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ARTICLE 38. COMMUNICATION WITH MEMBERS.

(a) Each member shall designate an appropriate authority with which the Agency may communicate with regard to all matters arising under this Convention. The Agency may consider as formulated by the member the declarations made by that authority. At the request of a member, the Agency shall consult with respect to the matters referred to in Articles 19 to 21 and relate to entities or insurers of that member;

(b) Where a member's approval is required before the Agency can perform a given action, the approval shall be deemed to have been granted unless the member submits an objection within a reasonable period of time. The body may determine when notifying the member of the action it intends to take.

CHAPTER VI.

VOTING RIGHTS, SUBSCRIPTIONS AND REPRESENTATION SETTINGS

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ARTICLE 39. VOTING RIGHTS AND ADJUSTMENTS TO SUBSCRIPTIONS.

a) In order to provide voting arrangements that reflect the equality of interests in the Body of the two categories of States appearing in Appendix A to this Convention, as well as the importance of the financial participation of each members, each member shall have 177 votes of membership plus one vote of subscription for each share held by that member in the share capital;

b) If at any time within three years after the entry into force of this Convention the total sum of the membership and subscription votes of the members belonging to any of the two categories of States listed in the Appendix A to this Convention is less than 40% of the total voting rights, the members of the category concerned shall have the number of additional votes necessary for the total of the voting rights of the This category is equal to such a percentage of the total voting rights. Supplementary votes shall be distributed among the members of that category in the proportion that the subscription votes of each one shall keep with the total of the votes of subscription of the category. Such additional votes shall be subject to automatic adjustment to ensure that this percentage is maintained and shall be cancelled at the end of the three-year period;

(c) During the third year following the entry into force of this Convention, the Council shall examine the allocation of shares and shall be guided by the following principles:

(i) the votes of the members shall reflect the effective subscriptions in the capital of the Agency and the votes of accession as recorded in Section a) of this Article,

(ii) the shares allocated to countries which have not subscribed to the Convention shall be made available to the members for reallocation purposes and in such a way as to enable the voting parity between the two categories mentioned above, and

(iii) the Council shall take the providences to facilitate the subscription by the members of the shares assigned to them;

(d) Within the three-year period stipulated in Section (b) of this Article, all decisions of the Board and the Board shall be taken by a special majority, unless the decisions requiring a higher majority under this Convention are take the highest majority;

(e) Where the share capital of the Agency increases in accordance with Section (c) of Article 5 (c), each member who so requests shall be entitled to subscribe to a proportion of the increase equivalent to the proportion of their shares. shares subscribed until then with the total equity capital of the Agency, but no member will be required to subscribe to any of the capital increase;

(f) The Council shall dictate the regulations concerning the additional subscriptions referred to in Section (e) of this Article. Such regulations will prescribe reasonable time limits for filing members ' requests to make such subscriptions.

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ARTICLE 40. VOTES IN THE COUNCIL.

(a) Each Governor shall be entitled to cast the votes of the member he represents. Unless otherwise specified in this Convention, the decisions of the Council shall be taken by a majority of the votes cast;

(b) For any meeting of the Council the quorum shall be constituted by the majority of the Governors exercising no less than two-thirds of the total voting rights;

c) The Council may by regulation provide for a procedure whereby the Board may request a Council decision on a specific issue without a Council meeting, where it considers that such a measure is appropriate. to the best interests of the Body.

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ARTICLE 41. CHOOSING DIRECTORS.

a) The Directors shall be chosen in accordance with Appendix B;

(b) The Directors shall continue in their duties until the election of their successors. If the position of a Director is vacant for more than 90 days before the end of his term, the Governors who elected the Director shall elect another for the remainder of the period. A majority of the votes cast will be required for the election. As long as the position remains vacant, the Substitute of the previous Director shall exercise the powers of the latter, with the exception of appointing a Substitute.

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ARTICLE 42. BOARD OF DIRECTORS VOTES.

(a) Each Director shall be entitled to issue the number of votes of the members whose votes counted for their election. All votes that a Director is entitled to cast shall be issued as a unit. Unless otherwise specified in this Convention, the decisions of the Board shall be taken by a majority of the votes cast;

(b) The quorum for a meeting of the Board shall be constituted by the majority of Directors having no less than half of the total voting rights;

(c) The Board may establish by regulation a procedure under which its Chairman may request a decision of the Board on a specific question without a meeting of the Board, when it considers that such a measure corresponds to the best interests of the Agency.

CHAPTER VII.

PRIVILEGES AND IMMUNITIES

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ARTICLE 43. PURPOSES OF THE CHAPTER. In order to enable the Agency to perform its functions, the immunities and privileges provided for in this Chapter shall be granted to it in the territory of each member.

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