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World Bank Loan Agreement Template

156 To illustrate the importance that the U.S. Congress attaches to the environmental sustainability of MDS-funded projects, see International Development and Finance Act of 1989, Pub. L. n° 101-240,. V, §521 (a) (codified in 22 U.S.C. §262m-7(a) (Supp. V 1993)) (Prohibition of U.S. support for MDS loans, unless an environmental impact assessment of the project is carried out in advance and submitted to the BMD Board of Directors). 46 Cf. International Bank for Reconstruction and Development, General Terms and Conditions of Loan and Guarantee Agreements of 15 March 1974, § 10.01 [hereinafter the «General Conditions of the IBRD 1974»); International Bank for Reconstruction and Development, Loans Ordinance No. 3 — of 15 June 1956, § 7.01 (applies to loans to member States) [hereinafter the World Bank Loans Regulations 1956]; International Bank for Reconstruction and Development, Loan Regulations No. 4 – of 15 1956, §7.01 (applies to loans guaranteed by Member States). Broches quotes the first sentence of § 7.01 of the Credit Regulations No.

3 and then notes that «this formula was conceived in 1947 when the bank was about to carry out its first credit operation». Pins, op. cit. cit., Note 2, p. 344. Accord, Hugh N. Scott, The Enforceability of Loan Agreements Between the World Bank and Its Member Countries, 13 am. U. L. Rev. 185, 190 (1964).

68 That view was later expressed in the 1969 Vienna Convention on the Law of Treaties, which included in its definition of a treaty the criterion that it is `subject to international law`, suggesting that certain international agreements between subjects of international law may nevertheless be subject to domestic law. See Vienna Convention on the Law of Treaties of 23 May 1969, art. 2 (l)(o), 1155 UNTS 331, 8 ILM 679 (1969) (entered into force on 27 May 1969). January 1980) [`the 1969 Vienna Convention`]. 108 The EBRD approved its first loan in June 1991. See European Bank for Reconstruction and Development, Annual Report 1991-20 (1992). 53 A third set of provisions of the World Bank`s general terms and conditions concerns the legal status of World Bank loan agreements at the time of their signature, that is to say, the legal service of the act of their signature. Article 12.01 of the General Terms and Conditions stipulates that a loan agreement and a guarantee contract «shall only take effect after satisfactory proof has not been provided to the Bank. that the execution and provision [of these agreements] on behalf of the borrower and the guarantor have been duly approved or ratified by all necessary governmental and commercial measures. » General Terms and Conditions of the IBRD 1985, op.

cit. Cit. Note 14, §12.01 (a). This provision suggests that the loan agreement and the guarantee agreement are not legally binding and enter into force as soon as they are signed, a proposal supported by § 12.03. It provides that the loan agreement and the guarantee contract «shall enter into force on the day on which the bank notifies the borrower and the guarantor of the acceptance of the evidence required by Article 12.01». Id., §12.03(a). In explaining these provisions, Broches pointed out that «it is clearly not envisaged that the loan agreement [or guarantee contract] will enter into force as soon as it is signed». Pins, op. cit. Cit. Note 2, p.

392. Between the time of signature and the time of entry into force, the borrower has the «possibility» to proceed with the loan or not, id. at 394, and «is not obliged to put the agreement into force». Id. at 397. 153 See text in footnotes 7 to 10 above. For a recent example of the AfDB review, see Development Banking: Double Trouble, Economist, May 14, 1994, p. 81 (referring to an external report criticizing the AfDB for its heavy and cumbersome bureaucracy riddled with political intrigue and arbitrary control of credit). What is the law applicable to credit agreements concluded by the World Bank and other multilateral development banks (MDBs) in the exercise of their loans to the public sector? This question was first answered definitively about thirty-five years ago.

This article reviews the issue in the light of recent developments in practice, in particular at the latest MDS, the European Bank for Reconstruction and Development (EBRD). 127 As is apparent from the text in footnote 80, the most widespread view in 1959 was that an agreement concluded with a non-State entity as a party could not have international law as the applicable law. For the same view expressed in 1956, see Sommers, Broches & Delaume, note 17 above, p. 470 (noting that national and international courts had not supported the view that loans involving both a private sector and a State should be subject to international law and not to domestic law). Indeed, in the 1950s, it was not entirely undisputed that any agreement involving an international organization such as the World Bank – even an agreement with a state – could be subject to international law. Broches devoted a few pages in his 1959 lectures to proving that international organizations, including the World Bank, have the right (and often) permission to conclude international agreements. See Broches, loc. cit., note 2, 316–38. For a summary of current views on the treaty-making powers of international organizations, see Brownlie, Note 120, 683-84 above. See also Delaume, Contracts, loc.

cit. 89, §1.11.129 See Mettälä, loc. cit. 48, p. 228-29 (noting that, although there are some restrictions, «[t]he autonomy of the parties to choose the law governing their agreement … accepted as a basic rule in almost all jurisdictions. »). See also Delaume, Traités, loc. cit. 89, § 1.01 (recalling that, in general, «the parties to transnational contracts enjoy a high degree of autonomy in the choice of [the applicable law]»); NANDA, note 48 above, § 5.03 [1], to 5-101, 5-102, § 5.03 [3] [a], to 5-126, 5-127, § 5.03 [3] [b], to 5-131 (with reference to the acceptance of party autonomy in the choice of law applicable under US law, the EC Convention on the Law Applicable to Contractual Obligations and the laws of certain other countries). The UNCITRAL Arbitration Rules, see footnote 114, expressly confirm the principle of party autonomy.

Article 33 provides that `[t]he arbitral tribunal shall apply such law as the parties determine to be applicable to the substance of the dispute`. 14 Cf. International Bank for Reconstruction and Development, General Terms and Conditions of Loan and Guarantee Agreements of 1. January 1985, § 5.08 [hereinafter the «1985 General Conditions of the IBRD»]. How these terms and conditions are incorporated into a particular loan agreement is discussed in text and notes 27-44 below. 128 For discussions demonstrating that international law may be chosen as the applicable law in treaties involving at least one party that is not the subject of international law (that is, at least one party that is not a State or an international organization), see Mettälä, loc. cit. 48, p. 240-41 (noting that even «a private lender and a private borrower may also choose international law, to regulate their loan agreement, «although some obstacles that existed from 1986 onwards would probably preclude a broad application of this option). For many years, certain types of treaties between States and private parties, including oil concession contracts, have often included provisions that establish international law as the applicable law. .