PART II-SELECTION OF DIRECTORS BY GOVERNORS REPRESENTING STATE PARTICIPANTS (1) In balloting for the selection of directors, each governor representing a State participant shall cast for one person all of the votes to which the State appointing him is entitled. The six persons receiving the greatest number of votes shall be directors, except that no person who receives less than 12 percent of the total of the votes of such governors shall be considered elected. (2) When six persons are not elected on the first ballot, a second ballot shall be held in which the person who received the lowest number of votes shall be ineligible for election and in which there shall vote only (a) those governors who voted in the first ballot for a person not elected and (b) those governors whose votes for a person elected are deemed under (3) below to have raised the votes cast for that person above 15 percent of the eligible votes. (3) In determining whether the votes cast by a governor are to be deemed to have raised the total of any person above 15 percent of the eligible votes, the 15 percent shall be deemed to include, first, the votes of the governor casting the largest number of votes for such person, then the votes of the governor casting the next largest number, and so on until 15 percent is reached. (4) Any governor, part of whose votes must be counted in order to raise the total of any person above 12 percent, shall be considered as casting all of his votes for such person even if the total votes for such person thereby exceeded 15 percent. (5) If, after the second ballot, six persons have not been elected, further ballots shall be held on the same principles until six persons have been elected, provided that after five persons are elected, the sixth may be elected by a simple majority of the remaining votes and shall be deemed to have been elected by all such votes. (6) The Governors representing State participants may change the foregoing rules by a 75 percent majority of the total voting power of such governors. (7) There shall be a new selection of directors representing State participants at each of the first three annual meetings of the Board of Governors. (8) Each director shall appoint an alternate who shall have full power to act for him when he is not present. Directors and their alternates shall be nationals of State participants. VIII. Withdrawal, Suspension of Membership and Cessation of Operations....... 879 51. Withdrawal 52. Suspension of Membership 53. Rights and Duties of States Ceasing to be Members 55. Liquidation..... IX. Settlement of Disputes 56. Interpretation and Application of the Convention................... 58. Disputes Involving Holders of a Guarantee or Reinsurance. Annex I: Guarantees of Sponsored Investment Under Article 24... Annex II: Settlement of Disputes Between A Member and the Agency Under 879 879 879 880 880 880 880 881 881 881 881 881 882 882 882 882 882 882 883 883 883 883 884 884 885 885 885 885 885 885 886 886 887 888 889 892 9. Multilateral Investment Guarantee Agency Done at Seoul; Opened for signature October 1985 at the International Bank for CONVENTION ESTABLISHING THE MULTILATERAL INVESTMENT PREAMBLE The Contracting States CONSIDERING the need to strengthen international cooperation for economic development and to foster the contribution to such development of foreign investment in general and private foreign investment in particular; RECOGNIZING that the flow of foreign investment to developing countries would be facilitated and further encouraged by alleviating concerns to non-commercial risks; DESIRING to enhance the flow to developing countries of capital and technology for productive purposes under conditions consistent 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 the encouragement of foreign investment complementing national and regional investment guarantee programs and private insurers of non-commercial risk; and REALIZING that such Agency should, to the extent possible, meet its obligations without resort to its callable capital and that such an objective would be served by continued improvement in investment conditions, HAVE AGREED AS FOLLOWS: CHAPTER I-ESTABLISHMENT, STATUS, PURPOSES AND DEFINITIONS ARTICLE 1. ESTABLISHMENT AND STATUS OF THE AGENCY (a) There is hereby established the Multilateral Investment Agency (hereinafter called the Agency). (b) The Agency shall possess full juridical personality and, in particular, the capacity to: (i) contract; (ii) acquire and dispose of movable and immovable property; and (iii) institute legal proceedings. ARTICLE 2. OBJECTIVE AND PURPOSES The objective of the Agency shall be to encourage the flow of investments for productive purposes among member countries, and in particular to developing member countries, thus supplementing the activities of the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter referred to as the Bank), the International Finance Corporation and other international development finance institutions. To serve its objective, the Agency shall: (a) issue guarantees, including coinsurance and reinsurance, against non-commercial risks in respect of investments in a member country which flow from other member countries; (b) carry out appropriate complementary activities to promote the flow of investments to and among developing member countries; and (c) exercise such other incidental powers as shall be necessary or desirable in the furtherance of its objective. The Agency shall be guided in all its decisions by the provisions of this Article. ARTICLE 3. DEFINITIONS For the purposes of this Convention: (a)"Member" means a State with respect to which this Convention has entered into force in accordance with Article 61. (b)"Host country" or "host government" means a member, its government, or any public authority of a member in whose territories, as defined in Article 66, an investment which has been guaranteed or reinsured, or is considered for guarantee or reinsurance, by the Agency is to be located. (c) A "developing member country" means a member which is listed as such in Schedule A hereto as this Schedule may be amended from time to time by the Council of Governors referred to in Article 30 (hereinafter called the Council). (d) A "special majority" means an affirmative vote of not less than two-thirds of the total voting power representing not less than fifty-five percent of the subscribed shares of the capital stock of the Agency. (e) A "freely usable currency" means (i) any currency designated as such by the International Monetary Fund from time to time and (ii) any other freely available and effectively usable currency which the Board of Directors referred to in Article 30 (hereinafter called the Board) may designate for the purposes of this Convention after consultation with the International Monetary Fund and with the approval of the country of such currency. H |