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Law No. 63 Of 8 July 1992 On Ratification Of The Loan Agreement Between Romania And The International Bank For Reconstruction And Development, Concluded At Washington On 2 June 1992

Original Language Title:  LEGE nr. 63 din 8 iulie 1992 pentru ratificarea Acordului de împrumut dintre România şi Banca Internaţională pentru Reconstrucţie şi Dezvoltare, încheiat la Washington la 2 iunie 1992

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LEGE No 63 of 8 July 1992 for the ratification of the Loan Agreement between Romania and the International Bank for Reconstruction and Development, concluded in Washington on 2 June 1992
ISSUER PARLIAMENT
Published in OFFICIAL MONITOR NO. 160 of 14 July 1992



The Romanian Parliament adopts this law + Article 1 The loan agreement between Romania and the International Bank for Reconstruction and Development, worth 400 million U.S. dollars, concluded in Washington on June 2, 1992, is ratified. + Article 2 Quarterly, the Government will present to the Parliament reports on the state of implementation of the proposed measures for compliance with the clauses provided for in the agreement 1. This law was adopted by the Senate at the meeting of June 23, 1992, in compliance with the provisions of art 74 74 para. (2) of the Romanian Constitution. SENATE PRESIDENT academician ALEXANDRU BIRLADEANU This law was adopted by the Chamber of Deputies at the meeting of June 29, 1992, in compliance with the provisions of 74 74 para. (2) of the Romanian Constitution. CHAMBER OF DEPUTIES PRESIDENT MARTIAN DAN LOAN AGREEMENT (Structural adjustment loan) between Romania and the International Bank for Reconstruction and Development Loan agreement, dated June 2, 1992, between Romania (Loan) and the International Bank for Reconstruction and Development (Bank) Given that: (A) The Bank received a letter dated May 4, 1992 from the Loan, in which a program of actions, objectives and policies intended to achieve the structural adjustment of the lending economy (hereinafter referred to as the programme) is described. declaring the commitment of the Loan to the execution of the programme and requesting assistance from the Bank for the financing of the necessary emergency imports during the execution; and (B) on the basis, inter alia, of the above mentioned, the Bank decided that in support of the program to assist the borrower through a loan that would be made redundant in two instalments, according to the following. As a result, the above mentioned parties agreed on the following: + Article 1 General conditions. Definitions Section 1.01-"The general conditions applicable to the loan and guarantee agreements" of the Bank, dated January 1, 1985, with the changes set out below (General Conditions) are an integral part of this agreement: a) Section 2.01, paragraph 11 will be amended as follows: " The project means imports and other activities that can be financed from the loan amounts according to the provisions of Annex no. 1 1 to the loan agreement. '; b) Section 9.07 c) will be amended as follows: " c) Within no more than 6 months from the expiry date or at a later date agreed for this purpose between the Loan and the Bank, the Loan will prepare and provide the Bank with a report, with the content and in the details reasonably requested by the Bank. Bank, on the execution of the program referred to in the preamble to the Loan Agreement, the fulfilment by the Loan and the Bank of their obligations according to the Loan Agreement and the achievement of the loan objectives "; and c) The last sentence of section 3.02 is deleted. d) In section 6.02, the subparagraph k) shall be renumbered as subparagraph (1) and a new subparagraph k shall be added, having the following content: " k) An extraordinary situation will be arisen, given that any additional draws from the loan will be non-compliant with the provisions of art. Section 3 of the Statute of the Bank. Section 1.02. -If the context does not require otherwise, the terms defined in the General Conditions and in the preamble to this agreement have the respective meanings exposed therein, and by the term 3 "S.I.T.C." is understood the Standard International Trade Classification, revised the third time (S.I.T.C. Rev. 3), published by the United Nations in Statistical Documents, Series M, No. 343 (1986). + Article 2 Loan Section 2.01. -The Bank agrees to borrow the Loan, in the terms and conditions exposed or referred to in the Loan Agreement, various currencies which will have an amount of sum equivalent to the sum of four hundred million dollars ($400,000,000), representing the amount of the loan draws, with each draw assessed by the Bank taking into account the date of this draw. Section 2.02. -a) The amount of the loan may be drawn from the loan account, in accordance with the provisions of Annex no. 1 1 to this agreement. b) The loan may, for the purposes of the program, open and maintain a special deposit account in dollars at the National Bank of Romania, in terms and conditions satisfactory for the Bank. Deposits and payments in and from the special account will be made according to the provisions of Annex no. 5 5 to this agreement. Section 2.03. -The expiry date will be 31 December 1993 or a later date set by the Bank. The bank will promptly announce on the Loan on the extension of the date. Section 2.04. -The borrower will periodically pay the Bank an non-use fee at the rate of three-fourths of a percentage (3/4 of 1%) per annum for the capital of the undrawn loan. Section 2.05. -a) The loan will periodically pay interest on the loan capital for the amounts drawn and unused, at an equal rate, for each interest period, with the cost of qualified loans determined in the previous semester, plus one half of a percentage (1/2 of 1%). On each of the dates specified in section 2.06. of this agreement, the borrower will pay the interest related to the non-refunded capital during the previous interest period, calculated at the rate applicable during that period of interest. b) Indate that will be possible after the end of each quarter, the Bank will communicate to the Loan the cost of qualified loans determined for that semester. For the purposes of this section: (i) The period of interest shall be a period of 6 months ending on the date immediately preceding each date specified in section 2.06. of this Agreement, beginning with the period of interest in which this Agreement is signed. (ii) The cost of qualifying loans represents the cost, as determined reasonably by the Bank and expressed as one percent per year of the Bank's unpaid loans, committed after June 30, 1982, excluding those loans or parties. from these allocated by the Bank to finance: (A) the investments of the Bank; and (B) the loans that will have been made by the Bank after July 1, 1989, with interest determined differently than according to the paragraph a) of this section. ((iii) Semester represents the first 6 months or the next 6 months of a calendar year. d) At that time which may be specified by the Bank by preavation of the Loan no less than 6 months before, paragraphs a), b) and c) (iii) of this section will be amended as follows: " a) The borrower will pay the interest for the loan part drawn and repaid periodically, at a rate for each quarter equal to the cost of the qualified loans, determined for the previous quarter, plus one half of a percentage (1/2 of 1%). On each of the dates specified in section 2.06. of this Agreement, the Loan will pay the interest related to the non-refundable part corresponding to the preceding interest period, calculated at the rates applicable during this period of interest. " "b) As soon as possible after the end of each quarter, the Bank shall communicate to the borrower the cost of the qualified loans, determined for that quarter." " c) (iii) The quarter represents a period of 3 months from 1 January, 1 April, 1 July or 1 October in a calendar year. ' Section 2.06. -Interest and other commissions will be payable semi-annually, on January 15 and July 15 each year. Section 2.07. -The borrower will reimburse the loan amount according to the amortization schedule set out in Annex no. 2 2 to this agreement. + Article 3 Special clauses Section 3.01. --a) Periodically, the Loan and the Bank, at the request of either party, shall hold discussions on the progress made in carrying out the programme and the actions specified in Annex no. 4 4 to this agreement. b) Prior to such discussions, the Loan will provide the Bank, for analysis and commentary, with a progress report made in the performance of the programme, with the details reasonably requested by the Bank. Section 3.02. -Unless the Bank agrees otherwise, the purchase of the goods to be financed from the loan amounts will be governed by the provisions of Annex no. 3 3 to this agreement. Section 3.03. -a) The borrower shall keep or shall ensure that adequate records and accounts are kept which function according to the sound accounting practices of the expenditure financed from the loan amounts. b) Lending: (i) shall keep records and accounts referred to in paragraph a) of this section, including those for the special account, for each fiscal year at which the accounting expertise was carried out, according to the appropriate principles of expertise accounting, applied by independent accounting experts, acceptable to the Bank; (ii) provide the Bank, as soon as it is available, but in any event not later than 6 months after the end of each year, an authenticated copy of the report of this expertise carried out by the said experts, having the scope and details reasonably requested by the Bank; and ((iii) shall provide the Bank with such information as to the records and accounts referred to, as well as the expertise, as will be reasonably requested by the Bank on a regular basis. c) For all expenses for which draws from the loan account were made based on the expenses statements, the Loan: ((i) shall keep or ensure the keeping, in accordance with paragraph a) of this section, of records and accounts reflecting such expenditure; (ii) will keep, at least one more year after the Bank has received the expert report for the fiscal year in which the last drawing from the loan account was made, all documents (contracts, orders, invoices, transport documents, receipts and other documents) highlighting these expenses; (iii) provide the opportunity for representatives of the Bank to examine these documents; and (iv) ensure that these records and accounts are included in the annual surveys referred to in paragraph b) of this section and that the expert report contains a separate opinion of the said accounting experts showing that the expenditure statements presented during that fiscal year, as well as the internal procedures and controls involved in their preparation, may guarantee the correctness of the drawdowns to which they relate. + Article 4 Additional condition of suspension Section 4.01. --For the purposes of Section 6.02. (1) of the General Conditions, the following additional condition is specified, namely the provision of a situation that makes it unlikely to carry out the program or an important part of it. + Article 5 Cease Section 5.01. -The term ninety (90) days after the date of this agreement is specified for the purposes of section 12.04. of the General Conditions. + Article 6 The Borrower's Representations. Addresses Section 6.01. -The Minister of Economy and Finance of the Loan is designated as a representative of the Loan for the purposes of section 11.03. of the General Conditions. Section 6.02. -The following addresses for the purposes of section 11.01 are specified. For Borrower: Ministry of Economy and Finance Str. Apolodor no. 17 Sector 5, Bucharest Romania Telex: 11239 For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable addresses: Telex: INTBAFRAD248423 (RCA) Washington, D.C. 82987 ((FTCC) 64145 (WUI) or 197688 (TRT) For the certification of the above, the present parties, through authorized representatives according to the procedure, agreed that this agreement should be signed, on their behalf, in the District of Columbia-United States of America, on the day and year mentioned at the beginning. ROMANIA By Authorised representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By Regional Vice-President Europe and Central Asia + Annex 1 Drawing of the loan amounts 1. In accordance with the specified provisions or referred to in this Annex, the loan amounts may be drawn from the loan account for expenses incurred (or, if the Bank agrees, to be carried out) with the costs reasonable of the necessary goods during the execution of the program and which will be financed from these amounts. 2. By exception to the provisions of paragraph 1 above, no draws will be made for: a) expenses for goods included in the following groups and subgroups S.I.T. C, or any groups and subgroups that will replace them according to future revisions of S.I.T.C., so designated by the Bank by notification to the Loan: GroupaSubgroup Description of Articles 112 -Alcoholic beverages 121 -Unprocessed tobacco, waste 122 -Tutun processed (containing or not tobacco substitutes) 525 -Radioactive materials and associated with them 667 -Pearls, precious and semi-precious stones, unprocessed or processed 718718.1Nuclear reactors and their components, combustible elements (cartridges) not irradiated for nuclear reactors 728728.43Tobacco processing machinery 897897.3Gold, silver or metal jewellery platinum (excluding watches and watch cases) as well as processed goods of gold and silver (including jewelry sets) 971-Non-monetary gold (excluding gold watches and concentrates) b) expenses in the currency of the Loan or for goods supplied from the territory of the Loan, exclusively, if the currency of the Loan is the same as of another country, expenses in that currency for the goods obtained from the territory of that country; c) payments made for expenses prior to the date of this agreement, except for draws in a cumulative amount not exceeding the equivalent of $80 million, which may be made on account of payments made for these expenses before that date, but after 24 February 1992; d) expenses for goods purchased under contracts of values less than the equivalent of $100,000; e) expenses for goods supplied under a contract that any national or international financial institution or agency, other than the Bank, will be financed or will be accepted to finance; and f) expenses for goods intended for military or paramilitary purpose or for luxury consumption. 3. Draws for expenses on contracts for the purchase of goods with estimated values of less than one million dollars may be requested by the Bank on the basis of expenses statements according to the terms and conditions specified by the Bank. 4. As far as possible, the drawing requests will thus be brought together incit the request for drawing to be made for cumulative amounts equating no less than $5 million. 5. No shooting will be carried out and no commitment will be made for the payment of the amounts or on the order of the Loan, on the expenses to be financed from the loan amounts after the cumulative amounts of the loan drawn from the account loan together with the total amount of such commitments will be reached the equivalent of $250 million, unless the Bank will be satisfied, after an exchange of views according to the provisions of section 3.01. of this agreement, based on satisfactory accounts for the Bank: a) the progress made by the Loan in the performance of the programme; and b) that the actions presented have been taken. 6. If, following the exchange of views presented in paragraph 4 above, the Bank will be notified to the Loan that the progress made and the actions taken are not satisfactory and, within 90 days of this notification, the Loan will not be be made progress and no satisfactory actions will be taken for the Bank, then the Bank may, on the basis of a notification to the Loan, cancel the undrawn amount of the loan or any part thereof. + Annex 2 Depreciation schedule Repayment Date of capital (expressed in dollars) *) Every 15 January and 15 July from 15 January 1998 to 15 January 200916.665.000 and 15 July 200916.705.000 Note * *) The figures in this column represent the dollar equivalent, determined on the respective draw dates. See General Conditions, Sections 3.04 and 4.03. Early repayment premiums In accordance with section 3.04. b) of the General Conditions, the first payable for the amount of capital at any maturity of the loan that is paid in advance will be the percentage specified below for the time of the early repayment: The time of repayment anticipateThe first interest rate (expressed as an annual percentage) applicable to the loan at the date of early repayment, multiplied by: Not more than 3 years before maturity 0,18 More than 3 years, but not more than 6 years before maturity 0,35 More than 6 years, but not more than 11 years before maturity 0,65 More than 11 years, but not more than 15 years before maturity 0,88 More than 15 years before maturity + Annex 3 Purchase 1. Contracts for the purchase of goods, with estimated values in the equivalent of $5,000,000 or more each, will be awarded by competitive international tender according to the procedures provided in Sections I and II of the " Directives on the purchase of B.I.R.D. loans and A.I.D. loans " published by the Bank in May 1985 (directives), with the following amendments: a) Paragraph 2.8. of the Directives shall be cancelled and replaced as follows: "" 2.8. Notification and advertising The international community must be notified in time of the tender. This will be done by announcing invitations for applications for inclusion on a list of auction participants, for requests to meet qualifying conditions, or for auction; such notices must be made in at least one year. a newspaper of great circulation in the country of Lending and, in addition, in at least one of the following forms: ((i) a notification in the publication of the United Nations, the Development Forum, the business edition; or (ii) an advertisement in a newspaper, periodical or technical gazette of international circulation; or (iii) a notification to the local representatives of the countries and territories referred to in the Directives, which are potential suppliers of the goods requested. " b) The following provisions are added at the end of paragraph 2.21. of the Directives: "As an additional alternative, tender documents may require the auctioneer to express the auction price in a single currency of wide circulation in international trade and specified in the tender documents." c) Paragrams 2.55. and 2.56. of the Directives shall be cancelled. 2. Contracts for the purchase of goods for estimated values of less than $5,000,000 equivalent will be granted: a) by buyers who are required to follow the public procurement procedures of the Loan for the importation of goods, on the basis of such procedures, provided that these procedures are deemed acceptable by the Bank; and b) by other purchasers, according to the existing commercial practice, provided that such contracts are awarded on the basis of the comparative assessment of quotations obtained from suppliers in at least two countries, except for direct Acceptable contracting for the Bank, which may be used when deemed appropriate, according to paragraph 3.5. of the Directives. 3. The commonly traded goods may be purchased, subject to prior approval from the Bank, through international commodity exchanges or other competitive purchasing channels, acceptable to the Bank, according to the procedures. acceptable Bank. 4. For each contract referred to in paragraph 1 of this Annex, the Loan shall provide to the Bank, before the submission to the Bank of the first request for the drawing of funds from the loan account on that contract, two copies typified of such a contract, together with the analysis of those tenders and recommendations for granting, a description of the advertising and bidding procedures followed and other such information as the Bank will reasonably request. When payments to a contract must be made from the amounts of the special account, such copies, together with other information requested to be provided to the Bank as a result of this paragraph, will be provided to the Bank as part of the required record paragraph 4 of Annex no. 5 5 to this agreement. 5. For each contract referred to in paragraphs 2 and 3 of this annex, the Loan will provide the Bank, before the submission to the Bank of the first request for drawing the amounts from the loan account in connection with it, such a documentation and information as the Bank can reasonably request to support the drag requests for such a contract. When payments for a contract are to be made from the special account amounts, the documentation and information to be provided to the Bank, according to the provisions of this paragraph, will be provided to the Bank as part of the paragraph 4 of Annex no. 5 5 to this agreement. 6. The provisions of the previous paragraph 5 of this annex will not apply to contracts in the account of which draws from the loan account must be carried out, based on the expenses statements. + Annex 4 Actions referred to in paragraph 5 b) of Annex no. 1 1 to this agreement 1. Continuation of maintaining a macroeconomic framework in accordance with the objectives of the program, as determined on the basis of the indicators acceptable to the Loan and the Bank. 2. Continuing the satisfactory implementation of a program, agreed with the Bank for the elimination of all subsidies for consumption until December 31, 1993. 3. a) Continuing the maintenance of an investment unit, with personnel and other resources, with working hours and satisfactory terms of reference for the Bank; b) the completion of the analysis by the respective unit of public investment projects, planned and under construction, according to the rules and criteria agreed with the Bank; c) the adoption of all necessary measures to ensure that only such public investment projects, in relation to which the Loan and the Bank will agree on the basis of such an analysis, will be approved or continued. 4. a) Establishment of a structure of the satisfactory price to the borrower and the Bank, for crude oil, electricity, coal and lignite, including a formula for maintaining these prices at parity with world prices, as agreed with the Bank; b) satisfactory implementation of a program agreed with the Natural Gas Price Growth Bank, in accordance with the satisfactory methodology for the Bank, with at least 10% quarterly in real terms, starting July 1, 1992 and until this price reaches and then is maintained at a sufficient level to thus cover the cost economic; c) the liberalisation of the price structure of all products, other than those referred to in subparagraphs a) and b) of this paragraph, so that all limits on production and retail prices are deleted; and reduce the notification period for increasing the price to no more than 30 days. 5. Establishment of an agency, equipped with personnel and other satisfactory reference resources and terms for the Bank, which shall be responsible for the application of the anti-monopoly laws and regulations of the Loan. 6. Elimination of all restrictions and allowances applicable to the export of goods from Romania, except for such goods that will be agreed with the Bank. 7. a) Continuing the maintenance of the system for monitoring the economic and financial viability of state-owned enterprises, based on the rules and criteria agreed with the Bank; b) the satisfactory implementation of a program agreed with the Bank for the restructuring or liquidation of state-owned enterprises which, according to the rules and criteria referred to in subparagraph a), will be determined to be economically or financially unviable; c) ensuring that the outstanding payments of State enterprises are limited to no more than 7.5% of the cumulative amount of turnover of state enterprises, calculated according to the satisfactory rules for the Bank. 8. a) Development and application of satisfactory criteria for the Bank, for the establishment and continuation of activities of autonomous regions; and b) the adoption and initial implementation of a satisfactory program to the Bank for reclassification, according to the Law No. 31/1990 31/1990 of the borrower, of any autonomous rule which does not correspond to the criteria referred to in this subparagraph a). 9 9. Completing all measures agreed with the Bank for the privatization of: a) about 3,000 state stores, service units, restaurants and selected workshops; and b) about 20 selected state enterprises. 10. Completing all measures agreed with the Bank to reform familiar allowances, including reducing taxes for people with children, by ensuring: a) the uniform application of such allowances, including the reduction of taxes, for all families with children falling within the criteria agreed with the Bank; b) of an equal allowance for each child; and c) that all tax cuts and the budgetary allocations paid from the account of such aid will be limited, on 1 January 1993 and below, to no more than the equivalent of 2% of Romania's gross domestic product. + Annex 5 Special Account 1. For the purposes of this Annex: a) the term eligible expenses represent expenses related to the reasonable cost of the goods requested during the execution of the program and which will be financed from the loan amounts according to the provisions of Annex no. 1 1 to this agreement; and b) the authorized allocation period represents an amount equivalent to $40,000,000 that will be drawn from the loan account and will be deposited in the special account, according to paragraph 3 a) of this annex. 2. Payments from the special account will be made exclusively for eligible expenses, according to the provisions of this annex. 3. After the Bank has received proof, satisfactory for it, that the special account has been opened in due time, the draws of the authorized allocations and subsequent drawdowns for the replenishment of the special account will be carried out as follows: a) For draws from authorized allocations, the Loan will provide the Bank with an application or applications for a submission or deposits that do not exceed the total amount of the authorized allocation. Based on this request or requests, the Bank, on behalf of the Loan, will draw from the loan account and deposit in the special account that amount or amounts requested by the Loan. b) (i) For the replenishment of the special account, the Loan will provide the Bank with requests for deposits in the special account at those intervals that the Bank will specify. ((ii) Before or on the date of each such request, the Loan will provide the Bank with the documents and other evidence requested, in accordance with paragraph 4 of this annex, for payment or payments in relation to which the refuelling is requested. On the basis of each such request, the Bank, on behalf of the Loan, will draw from the loan account and deposit into the special account that amount requested by the Loan and shown by documents and other evidence, to be paid from the special account for eligible expenses. All these deposits will be drawn by the Bank from the loan account in the respective equivalent amounts, as justified by the documents and other evidence. 4. For each payment made by the Loan from the special account, the Loan, at the time reasonably requested by the Bank, will provide the Bank with those documents and other evidence showing that that payment was made exclusively for eligible expenses. 5. Without opposing the provisions of paragraph 3 of this annex, the Bank shall not be required additional deposits in the special account: a) if, at any time, the Bank has decided that all additional draws be made by the Loan directly from the loan account, in accordance with the provisions of art. 5 of the General Conditions and paragraph a) of section 2.02. of this Agreement; or b) once the total amount not drawn from the loan, less the amount of any outstanding commitment recorded by the Bank, according to section 5.02. of the General Conditions on the program, will be equal to the equivalent of twice the amount of the authorized allocation. Accordingly, the drawing from the loan account of the remaining undrawn amount from the loan will follow those procedures that will be specified by the Bank by notification to the Loan. Such additional drawdowns will only be made after and to the extent that the Bank will be convinced that all of these amounts, remaining as deposits in the special account at the time of this notice, will be used in making payments for eligible expenses. 6. a) If the Bank is to be determined, at any time, that any payment from the special account: (i) was made for an expense or in a non-eligible amount according to paragraph 2 of this annex; or (ii) was not justified by the evidence provided to the Bank, The borrower, immediately after the Bank's notification: (A) will provide that additional evidence that the Bank may require; or (B) will deposit in the special account (or, at the request of the Bank, reimburse it) an amount equal to the amount of that payment or parts thereof not so eligible or justified. If the Bank does not agree otherwise, no additional deposit will be made by the Bank in the special account until the Loan has been provided that evidence or made that deposit or refund, as the case may be. b) If the Bank is to be determined, at any time, that any remaining amount in the special account will not be requested to cover additional payments for eligible expenses, the Loan will reimburse the Bank, promptly, that outstanding amount, after the notification in The Bank c) The loan may, after the notification from the Bank, reimburse the Bank all or part of the amounts deposited in the special account. d) The repayments to the Bank, carried out in accordance with paragraphs 6 a), b) and c) of this annex shall be entered into the credit of the loan account for the following draw or for termination, according to the provisions of this agreement, including General conditions. -----------------