Distribution of assets (Article 50)
(I) In the event of termination of operations of the Bank, no distribution shall be made to members on account of their subscriptions to the capital stock of the Bank until:
(i) All liabilities to creditors have been discharged or provided for; and (ii) The Board of Governors has taken a decision to make a distribution.
This decision shall be taken by the Board exercising a majority of the total voting power of the members.
(2) After a decision to make a distribution has been taken in accordance with the preceding paragraph, the Board of Directors may by a two-thirds majority vote make successive distributions of the assets of the Bank to members until all assets have been distributed. This distribution shall be subject to the prior settle-ment of all outstanding claims of the Bank against each member.
(3) Before any distribution of assets is made, the Board of Directors shall fix the proportionate share of each member according to the ratio of its shareholding to the total outstanding shares of the Bank.
(4) The Board of Directors shall value the assets to be distributed at the date of distribution and then proceed to distribute in the following manner:
(a) There shall be paid to each member in its own obligations or those of its official agencies or legal entities within its territories, to the extent that they are available for distribution, an amount equivalent in value to its proportionate share of the total amount to be distributed.
(b) Any balance due to a member after payment has been made in accordance with the preceding sub-paragraph, shall he paid, in its currency, to the extent that it is held by the Bank, up to an amount equivalent in value to such balance.
(e) Any balan"" due to a member after payment has been made in accordance with sub-paragraphs (a) and (b) of this paragraph shall be paid in gold or currency acceptable to that member, to the extent that they arc held by the Bank, up to an amount equivalent in value to such balance.
(d) Any remaining assets held by the Bank after payments have been made to members in accordance with sub-paragraphs (aj to (c) of this paragraph shall be distributed pro rata among the members.
(5) Any member receiving assets distributed by the Bank in accordance with the preceding paragraph, shall enjoy the same rights with respect to such assets as the Bank enjoyed before their distribution.
See introductory note to Chapter VI. Art. 50 closely follows the language of IBRD, Art. VI(5) (e) to (i). One of the main features of the Article is that, in the event of the termination of operations of the Bank, the Board of Directors acts, in effect, as a Liquidation Board. Consequently, to the extent required for the pur-poses of liquidation, all provisions of the Agreement concerning that Board must be deemed to remain in operation after the termination of the operations of the Bank.
None.
ARTrCLE 49
DISTRIBUTION OF ASSETS
(I) In the event of termination of operations of the Bank, no distribution sllall be made to members on account of their subscriptions to the capital stock of the
!lank until:
(i) All liabilities to creditors have been discharged or provided for; and (ii) the Board of Governors has taken a decision to make a distribution.
This decision shall be taken by the Board exercising a majority of the total voting power of the members.
(2) After a decision to make a distribution has been taken in accordance with the preceding paragraph, the Board of Directors may by a two-thirds majority vote make successive distributions of the assets of the Bank to members until all assets have been distributed. This distribution shall be subject to the prior settlement of all outstanding claims of the Bank against each member.
(3) Eefore any distribution of assets is mad~, the Board of Directors shall fix the proportionate share of each memb~r according to the ratio of its shareholding to the total outstanding shares of the Bank.
(4) The Board of Directors sball value the assets to be distributed at the date of distribution and then proceed to distribute in the following manner:
(a) There shall be paid to each member in its own obligations or those of its official agencies or legal entities within its territories, to the extent that they are available for distribution, an amount equivalent in value to its proportionate share of the total amount to be distributed.
(b) Any balance due to a member after payment has been made in accordance with the preceding sub-paragraph, shall be paid in its currency, to the extent that it is held by the Bank, up to an amount equivalent in value to such balance.
(c) Any balance due to a member after payment has been made in accordance with sub-paragraphs (al and (b) of this paragraph shall be paid in gold or currency acceptable to that member, to the extent that they are held by the Bank, up to an amount equivalent in value to such balance.
(d) Any remaining assets held by the Bank after payments have been made to members in accordance with sub-paragraphs (a) to (c) of this paragraph shall be distributed pro rata among the members.
(5) Any member receiving assets distributed by the Bank in accordance with the preceding paragraph, shall enjoy the same rights with respect to such assets as the Bank enjoyed before their distribution.
- 182
--Draft prepared by the Committee of Nine
Explanatory notes submitted by the Committee of Nine
Amendments proposed by international organizations
Final text adopted by the Conference
CHAPTER VII
Status, Immunities, Exemptions and Privileges
STATUS Status (Article 51)
To enable it to fulfil its purpose and the functions with which it is entrusted, the Bank shall possess full juridical personality. To those ends, it may enter into agreements with members, non-member States and other international organiza-tions. To the same ends. the status. immunities. exemptions and privileges set forth in this chapter shall be accorded to the Bank in the rerritory of each merr.be:.
I. The Bank, its governors, directors, president and staff should have the neces-sary and customary privileges and immunities. The Articles of the present chapter follow closely the provisions of IBRD, Art. VII (and also IFC, Art. VI, and IDA, Art. VIII), except that they take into account:
(i) Recent experience of international organizations as reflected in the provisions of IADB, Art. XI; and
(ilJ The special needs of the Bank which, as distinct from the !BRD, IFC and IDA, is not a world-wide agency and will thus require powers to extend its activities (c.g. as regards mobilization of resources) to non~
members and their territories and, if need be, accept jurisdication of courts in non-member States.
2. The tran>actions of the Bank with member and non-member Governments (including, for in>tance, African Governments which have not yet become
memb~rs of the Bank - see note 3 to Art. 3 and Art. 29 (2))will take the form of agreements governed by international law; so willits transactions with other inter~
governmental lending agencies. Its transactions with private financial institutions (e.g. relating to bonds issued by it) will be governed by principles of civil law.
3. The Bank will therefore require international personality as well as personality under the law of its members. International personality entails capacity to enter into international agreements. This point requires express clarification in the Agree-ment so that the powers of the Bankto borrow, to lend, etc. (see Art. 23)should be beyond reasonable doubt of public authorities and private institutions in member and non-member countries.
4. This explains why this Article should contain the first two sentences which are not contained in the relevant provisions of the constituent instruments of other lending agencies. In accordance with the Advisory opinion of the International Court of Justice on the reparation for injuries in the senoice of the United Nations (1949 IC] Reports, pp.174 et. seq.) international personality and the capacity of the Bank to enter into international agreements have been limited by its purpose and func-tions. It may also be noted that, among other international instruments, the Con-vention of the Organisation for Economic Co-operation and Development (OECD) expressly provides for the capacity of that organization to enter into interna-tional agreements (Art. 5(c).
fBRD: The thought underlying the first sentence of this Article might be belter expressed by substituting for the last seven words "the Bank shall possess international and full legal capacity".
CHAPTER VII
Status, Immunites, Exemptions and Privileges ARTICLE 50
STATUS
To enable it to fulfil its purpose and the functions with which it is entrusted, the Bank shall possess full international personality. To those ends, it may enter into agreements with members, non-member States and other international organi-zations. To the same ends, the status, immunities, exemptjons and privileges set forth in this Chapter shall be accorded to the Bank in the territory of each member.
Draft prepared by the Committee of Nine
Explanatory notes submitted by the
Committee of Nine
Amendments proposed by international organizations
Final text adopted by the Conference