International Tropical Timber Agreement

 

Article 20
Special Account

1. There shall be established two sub-accounts under the Special Account:

(a) The Pre-Project Sub-Account; and

(b) The Project Sub-Account.

2. The possible sources of finance for the Special Account shall be:

(a) The Second Account of the Common Fund for Commodities, when it
becomes operational;

(b) Regional and international financial institutions; and

(c) Voluntary contributions.

3. The resources of the Special Account shall be used only for approved
projects or for pre-project activities.

4. All expenditures under the Pre-Project SubAccount shall be reimbursed
from the Project SubAccount if projects are subsequently approved and
funded. If within six months of entry into force of this Agreement the
Council does not receive any funds for the Pre-Project Sub-Account, it
shall review the situation and take appropriate action.

5. All receipts pertaining to specific identifiable projects shall be
brought into the Special Account. All expenditures incurred on such
projects, including remuneration and travel expenses of consultants and
experts, shall be charged to the Special Account.

6. The Council shall, by special vote, establish terms and conditions on
which it would, when and where appropriate, sponsor projects for loan
financing where a member or members have voluntarily assumed full
obligations and responsibilities for such loans. The Organization shall
have no obligations for such loans.

7. The Council may nominate and sponsor any entity with the consent of
that entity, including a member or members, to receive loans for the
financing of approved projects and to undertake all the obligations
involved, except that the Organization shall reserve to itself the right
to monitor the use of resources and to follow up on the implementation of
projects so financed. However, the Organization shall not be responsible
for guarantees voluntarily provided by individual members or other
entities.

8. No member shall be responsible by reason of its membership in the
Organization for any liability arising from borrowing or lending by any
other member or entity in connection with projects.

9. In the event that voluntary unearmarked funds are offered to the
Organization, the Council may accept such funds. Such funds may be
utilized for pre-project activities as well as for approved projects.

10. The Executive Director shall endeavour to seek, on such terms and
conditions as the Council may decide, adequate and assured finance for
projects approved by the Council.

11. Contributions for specified approved projects shall be used only for
the projects for which they were originally intended, unless otherwise
decided by the Council in agreement with the contributor. After the
completion of a project, the Organization shall return to each
contributor for specific projects the balance of any funds remaining pro
rata to each contributor’s share in the total of the contributions
originally made available for financing that project, unless otherwise
agreed to by the contributor.

Article 21
Forms of Payment

1. Contributions to the Administrative Account shall be payable in freely
usable currencies and shall be exempt from foreign-exchange restrictions.

2. Financial contributions to the Special Account shall be payable in
freely usable currencies and shall be exempt from foreign-exchange
restrictions.

3. The Council may also decide to accept other forms of contributions to
the Special Account, including scientific and technical equipment or
personnel, to meet the requirements of approved projects.

Article 22
Audit and Publication of Accounts

1. The Council shall appoint independent auditors for the purpose of
auditing the accounts of the Organization.

2. Independently audited statements of the Administrative Account and of
the Special Account shall be made available to members as soon as
possible after the close of each financial year, but not later than six
months after that date, and be considered for approval by the Council at
its next session, as appropriate. A summary of the audited accounts and
balance sheet shall thereafter be published.

Chapter VII
Operational Activities

Article 23
Projects

1. All project proposals shall be submitted to the Organization by
members and shall be examined by the relevant committee.

2. In order to achieve the objectives set out in article 1, the Council
shall examine all project proposals in the fields of research and
development market intelligence, further and increased processing in
developing producing member countries, and reforestation and forest
management, together with the recommendation submitted by the relevant
committee; such project proposals based on tropical timber as defined in
article 2, paragraph 1, may encompass tropical timber products other than
those listed in article 2, paragraph 1. This provision shall also apply,
where relevant, to the functions of the committees as set forth in
article 25.

3. On the basis of the criteria set out in paragraph 6 or paragraph 7 of
this article, the Council shall, by special vote, approve projects for
financing or sponsorship in accordance with article 20.

4. The Council shall, on a continuing basis, arrange for the
implementation of, and with a view to ensuring their effectiveness follow
up, approved projects.

5. Research and development projects should relate to at least one of the
following five areas:

(a) Wood utilization, including the utilization of lesser-known and
lesser-used species;

(b) Natural forest development;

(c) Reforestation development;

(d) Harvesting, logging infrastructure, training of technical
personnel;

(e) Institutional framework, national planning.

6. Projects on research and development approved by the Council shall be
consistent with each of the following criteria:

(a) They should be related to the production and utilization of
industrial tropical timber;

(b) They should yield benefits to the tropical timber economy as a
whole and be relevant to producing as well as consuming members;

(c) They should be related to the maintenance and expansion of the
international tropical timber trade;

(d) They should offer reasonable prospects for positive economic
returns in relation to costs; and

(e) They shall make maximum use of existing research institutions
and, to the greatest extent possible, avoid duplication of efforts.

7. Projects in the fields of market intelligence further and increased
processing, and reforestation and forest management, should be consistent
with criterion (b) and, as far as possible, consistent with criteria (a),
(c), (d) and (e) as contained in paragraph 6 of this article.

8. The Council shall decide on the relative priorities of projects,
taking into account the interests and characteristics of each of the
producing regions. Initially, the Council shall give priority to research
and development project profiles as endorsed by the Sixth Preparatory
Meeting on Tropical Timber under the Integrated Programme for Commodities
and to such other projects as the Council may approve.

9. The Council may, by special vote, terminate its sponsorship of any
project.

Article 24
Establishment of Committees

1. The following committees are hereby established as permanent
committees of the Organization:

(a) Committee on Economic Information and Market Intelligence;

(b) Committee on Reforestation and Forest Management; and

(c) Committee on Forest Industry.

2. The Council may, by special vote, establish such other committees and
subsidiary bodies as it deems appropriate and necessary.

3. The committees and subsidiary bodies referred to in paragraphs 1 and 2
of this article shall be responsible to, and work under the general
direction of, the Council. Meetings of the committees and subsidiary
bodies shall be convened by the Council.

4. Participation in each of the committees shall be open to all members.
The rules of procedure of the committees shall be decided by the Council.

Article 25
Functions of the Committiees

1. The Committee on Economic Information and Market Intelligence shall:

(a) Keep under review the availability and quality of statistics and
other information required by the Organization;

(b) Analyze the statistical data and specific indicators as
identified in annex C for the monitoring of international tropical timber
trade;

(c) Keep under continuous review the international tropical timber
market, its current situation and short-term prospects on the basis of
the data mentioned in subparagraph (b) above and other relevant
information;

(d) Make recommendations to the Council on the need for, and nature
of, appropriate studies on tropical timber, including long-term prospects
of the international tropical timber market, and monitor and review any
studies commissioned by the Council;

(e) Carry out any other tasks related to the economic, technical and
statistical aspects of tropical timber assigned to it by the Council;

(f) Assist in the provision of technical co-operation to producing
members to improve their relevant statistical services.

2. The Committee on Reforestation and Forest Management shall:

(a) Keep under regular review the support and assistance being
provided at a national and international level for reforestation and
forest management for the production of industrial tropical timber;

(b) Encourage the increase of technical assistance to national
programmes for reforestation and forest management;

(c) Assess the requirements and identify all possible sources of
financing for reforestation and forest management;

(d) Review regularly future needs of international trade in
industrial tropical timber and, on this basis, identify and consider
appropriate possible schemes and measures in the field of reforestation
and forest management;

(e) Facilitate transfer of knowledge in the field of reforestation
and forest management with the assistance of competent organizations;

(f) Co-ordinate and harmonize these activities for co-operation in
the field of reforestation and forest management with the relevant
activities pursued elsewhere, such as those under FAO, UNEP, the World
Bank, regional banks and other competent organizations.

3. The Committee on Forest Industry shall:

(a) Promote co-operation between producing and consuming members as
partners in the development of processing activities in producing member
countries, inter alia, in the following areas:

(i) Transfer of technology

(ii) Training;

(iii) Standardization of nomenclature of tropical timber

(iv) Harmonization of specifications of processed products;

(v) Encouragement of investment and joint ventures; and

(vi) Marketing;

(b) Promote exchange of information in order to facilitate structural
changes involved in increased and further processing in the interests of
both producing and consuming members;

(c) Monitor ongoing activities in this field, and identify and
consider problems and possible solutions to them in co-operation with the
competent organizations;

(d) Encourage the increase of technical assistance to national
programmes for the processing of tropical timber.

4. Research and development shall be a common function of the committees
established under article 24, paragraph 1.

5. In view of the close relationship between research and development,
reforestation and forest management, increased and further processing,
and market intelligence, each of the permanent committees, in addition to
carrying out the functions assigned to it above, shall, with regard to
project proposals referred to it, including those on research and
development in its area of competence:

(a) Consider and technically appraise and evaluate project proposals;

(b) In accordance with general guidelines established by the Council,
decide on and implement pre-project activities necessary for making
recommendations on project proposals to the Council;

(c) Identify possible sources of finance for projects referred to in
article 20, paragraph 2;

(d) Follow up the implementation of projects and provide for the
collection and dissemination of the results of projects as widely as
possible for the benefit of all members;

(e) Make recommendations to the Council relating to projects;

(f) Carry out any other tasks related to projects assigned to it by
the Council.

6. In carrying out these common functions, each committee shall take into
account the need to strengthen the training of personnel in producing
member countries; to consider and propose modalities for organizing or
strengthening the research and development activities and capacities of
members, particularly producing members; and to promote the transfer of
research know-how and techniques among members, particularly among
producing members.

 

Author: international