Chapter

Appendix B: Interpretations

Author(s):
International Monetary Fund
Published Date:
September 1946
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In Resolutions 5, 6, and 7 the Board of Governors, at their Inaugural Meeting, requested interpretations of the Fund Agreement by the Executive Directors.

1. In Resolution No. 5 of the Inaugural Meeting the Board of Governors requested an interpretation of Articles of Agreement as to Question of Fundamental Disequilibrium. The Resolution reads as follows:

Resolved:

That the Executive Directors of the International Monetary Fund are invited, at the request of the Governor for the United Kingdom, pursuant to Article XVIII (a), to interpret Article IV, Section 5 (f), as to whether, having regard to the intention of the Government of the United Kingdom to maintain full employment and to the terms of Article I (ii) and (v) of the Articles of Agreement, steps necessary to protect a member from unemployment of a chronic or persistent character, arising from pressure on its balance of payments, shall be measures necessary to correct a fundamental disequilibrium.

This interpretation had not been made when one Annual Report was prepared.

2. In Resolution No. 6 of the Inaugural Meeting the Board of Governors requested an interpretation of Articles of Agreement as to Authority of Fund to Use its Resources. The Resolution reads as follows:

Resolved:

That the Executive Directors of the International Monetary Fund are invited, at the request of the Governor for the United States of America, to interpret the Articles of Agreement, pursuant to Article XVIII (a), as to whether the authority of the Fund to use its resources extends beyond current monetary stabilization operations to afford temporary assistance to members in connection with seasonal, cyclical, and emergency fluctuations in the balance of payments of any member for current transactions, and whether the Fund has authority to use its resources to provide facilities for relief, reconstruction, or armaments, or to meet a large or sustained outflow of capital on the part of any member.

This interpretation had not been made when one Annual Report was prepared.

3. In Resolution No. 7 of the Inaugural Meeting the Board of Governors requested an interpretation of Articles of Agreement as to Appointment of Executive Director. The Resolution reads as follows:

Resolved:

That the following point of interpretation raised by the Governor for India in regard to Article XII, Section 3 (b) 1 and Section 3 (f) be referred to the Executive Directors for their decision in pursuance of Article XVIII (a) of the Articles of the International Monetary Fund namely:

  • That with reference to the Ad Hoc Committee's report on the position of the Executive Director for India adopted by your Governors at their meeting on the 15th of March and in view of the inconsistency between Section 3 (b) 1 and Section 3 (f) of Article XII that these sections be interpreted to mean that any member having one of the five largest quotas at the date of a regular election or at any date between regular elections shall be entitled to appoint an Executive Director who shall hold office until the next regular election without prejudice to the right of a subsequently admitted member to appoint a Director if it has one of the five largest quotas.

In accordance with Article XVIII of the Fund Agreement, the Executive Directors made the following interpretation on May 8:

  • Sections 3 (b) 1 and 3 (f) of Article XII should be interpreted to mean that any member having one of the five largest quotas at the date of the regular election or at any date between regular elections shall be entitled to appoint an Executive Director who will hold office until the next regular election without prejudice to the right of a subsequently admitted member to appoint a Director if it has one of the five largest quotas.

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