Chapter

Article XVII, Section 3

Author(s):
International Monetary Fund
Published Date:
April 2005
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Special Drawing Rights: Other Holders

Special Drawing Rights: Other Holders

The terms and conditions on which other holders prescribed by the Fund may accept, hold or use SDRs are as follows:

1. Acceptance, Holding, and Use by Prescribed Holders

(a)Acceptance and use

A prescribed holder may accept or use special drawing rights (i) in exchange for an equivalent amount of a monetary asset other than gold in a transaction entered into by agreement with a participant, or another prescribed holder, or (ii) in an operation entered into by agreement with a participant or another prescribed holder in accordance with and on the same terms and conditions established at that time for participants by decisions of the Fund under Article XIX, Section 2(c).

(b)Holding

A prescribed holder may hold special drawing rights, subject to the provisions of this decision, accepted in accordance with (a) above or received as interest paid on its holdings of special drawing rights in accordance with Article XX, Section 1.

2. Acceptance and Use by Participants in Transactions and Operations with Prescribed Holders

Participants may enter into transactions and operations by agreement with a prescribed holder in accordance with the prescriptions in paragraph l(a) of this decision.

3. Application of General Provisions

The holding of special drawing rights and the acceptance and use of them in transactions and operations by a prescribed holder shall be governed by the provisions of the Arricies, By-Laws, Rules and Regulations, and decisions of the Fund that apply from time to time to all holders of special drawing rights.

4. Exchange Rates

The Rules and Regulations and decisions of the Fund that determine the exchange rates applicable at the time of each use or acceptance of special drawing rights by a participant shall apply to each use or acceptance of them by a prescribed holder. A prescribed holder shall not levy any charge or commission in respect of a transaction involving special drawing rights.

5. Information and Recording

The Fund shall inform prescribed holders of matters relevant to the acceptance, holding, and use of special drawing rights by them. A prescribed holder shall inform the Fund promptly of the facts necessary to record any transactions or operations in which a prescribed holder accepts or uses special drawing rights.

6. Consultation and Review

  • (a) Consultation between the Fund and a prescribed holder shall be held at the request of the Fund or the prescribed holder with respect to the application of this decision or the decision prescribing the holder or with respect to transactions or operations entered into involving special drawing rights.

  • (b) The Executive Board shall review periodically this decision and decisions prescribing holders.

7. General Undertaking

Each prescribed holder shall collaborate with the Fund, participants, and other prescribed holders with respect to its acceptance, holding, and use of special drawing rights in order to facilitate the effective functioning of the Special Drawing Rights Department and the proper use of special drawing rights in accordance with the Articles and the terms and conditions prescribed by the Fund now or in the future for the acceptance, holding, and use of special drawing rights by prescribed holders.

8. Suspension

During any period in which a suspension is in effect under Article XXIII, Section 1 with respect to participants, the suspension shall apply to the same extent to prescribed holders.

9. Termination

  • (a) The prescription of a holder of special drawing rights may be terminated by the Fund by a decision of the Executive Board or by a notice from the prescribed holder in writing to the Fund at its principal office. Termination shall become effective on the date specified in the decision of the Executive Board but not earlier than the date of the decision, or when notice from the prescribed holder is received by the Fund at its principal office.

  • (b) A prescribed holder whose status as such has been terminated may continue to hold the special drawing rights it held on termination and to receive special drawing rights as interest on its holdings and may continue to use special drawing rights to dispose of them in transactions or operations in accordance with paragraph l(a) above. A prescribed holder whose status has been terminated shall make arrangements, with the concurrence of the Fund, to dispose of its holdings of special drawing rights as expeditiously as possible, and shall exchange special drawing rights for a freely usable currency selected by the prescribed holder when requested by the Fund.

Decision No. 6467-(80/71) S

April 14, 1980

Bank for International Settlements (BIS): Change in Terms and Conditions of Prescription as Holder of SDRs

The Bank for International Settlements is authorized to accept, hold, and use special drawing rights in transactions and operations in accordance with and on the terms and conditions specified in the decision “Terms and Conditions for the Acceptance, Holding, and Use of Special Drawing Rights by Other Holders Prescribed under Article XVII, Section 3,” Decision No. 6467-(80/71) S, adopted April 14, 1980. These terms and conditions shall replace those set forth in Board of Governors Resolution No. 29-1, dated January 21, 1974.1

Decision No. 6484-(80/77) S

April 18, 1980

Andean Reserve Fund—Holder of SDRs

1. Prescription as a Holder

The Andean Reserve Fund is prescribed, in accordance with Article XVII, Section 3(i) of the Articles of Agreement, as a holder of special drawing rights.

2. Terms and Conditions for Acceptance, Holding, and Use of Special Drawing Rights

The Andean Reserve Fund is authorized to accept, hold, and use special drawing rights in transactions and operations in accordance with and on the terms and conditions specified in the decision “Terms and Conditions for the Acceptance, Holding, and Use of Special Drawing Rights by Other Holders Prescribed under Article XVII, Section 3,” Decision No. 6467-(80/71) S, adopted April 14, 1980.

Decision No. 6486-(80/77) S1

April 18, 1980

Swiss National Bank—Termination of Status as Prescribed Holder of Sdrs

The Fund notes that the status of the Swiss National Bank as a prescribed holder of SDRs has been terminated as of November 19, 1992, and concurs in the arrangement made by the Swiss National Bank to sell its SDR holdings in a transaction by agreement on February 1, 1993. (EBS/92/197, 12/1/92)

Decision No. 10225-(92/147) S2

December 8, 1992

Use of SDRs in Payment of Trust Fund Obligations

In accordance with Article XVII, Section 3, the Fund prescribes that:

1. A participant, by agreement with a prescribed holder and at the instruction of the Fund, may transfer SDRs to the prescribed holder in repayment of Trust Fund loans, in payment of interest on Trust Fund loans and in payment of special charges in respect of overdue repayments and interest of Trust Fund loans.

2. The Fund shall record operations pursuant to this prescription in accordance with Rule P-9.

Decision No. 8642-(87/101) S/TR

July 9, 1987

Use of SDRs in Payment of Subsidy

In accordance with Article XVII, Section 3, the Fund prescribes that:

1. A prescribed holder, by agreement with a participant, may transfer SDRs to the participant in discharge of subsidy payable from the Supplementary Financing Facility Subsidy Account, at the instruction of the Fund as Trustee of that Account.

2. The Fund shall record operations pursuant to this prescription in accordance with Rule P-9.

Decision No. 8186-(86/9) SBS/S

January 15, 1986

Use of SDRs in Operations Under Structural Adjustment Facility

In accordance with Article XVII, Section 3, the Fund prescribes that:

1. A prescribed holder, by agreement with a participant and at the instruction of the Fund, may transfer SDRs to the participant in disbursement of a loan payable from the Structural Adjustment Facility within the Special Disbursement Account (“the Facility”).

2. A participant, by agreement with a prescribed holder and at the instruction of the Fund, may transfer SDRs to the prescribed holder in repayment of loans, and/or payment of interest on loans, under the Facility.

3. The Fund shall record operations pursuant to these prescriptions in accordance with Rule P-9.

Decision No. 8239-(86/56) SAF

March 26, 1986

Use of SDRs in Financial Operations Under the Enhanced Structural Adjustment Facility Trust or Under an Administered Account

In accordance with Article XVII, Section 3, the Fund prescribes that:

1. A participant or prescribed holder, by agreement with a prescribed holder and at the instruction of the Fund, may transfer SDRs to that prescribed holder in effecting a payment due to the Fund in connection with financial operations under the Enhanced Structural Adjustment Facility Trust or under an administered account established for the benefit of the Enhanced Structural Adjustment Facility Trust.

2. A prescribed holder, by agreement with a participant or another prescribed holder and at the instruction of the Fund, may transfer SDRs to that participant or other prescribed holder in effecting a payment due from the Fund in connection with financial operations under the Enhanced Structural Adjustment Facility Trust or under an administered account established for the benefit of the Enhanced Structural Adjustment Facility Trust.

3. The Fund shall record operations pursuant to these prescriptions in accordance with Rule P-9.

Decision No. 8937-(88/118) ESAF/S

July 28, 1988

Use of SDRs in Financial Operations Under the PRGF-HIPC Trust or Under an Administered Account

In accordance with Article XVII, Section 3, the Fund prescribes that (i) a participant or a prescribed holder, by agreement with a participant or a prescribed holder and at the instruction of the Fund, may transfer SDRs to that participant or prescribed holder in effecting a transfer to or from the Post-SCA-2 Administered Account or in effecting a payment due to or by the Fund in connection with financial operations under the PRGF-HIPC Trust or under an administered account established for the benefit of the PRGF-HIPC Trust; (ii) operations pursuant to these prescriptions shall be recorded in accordance with Rule P-9.

Decision No. 12062-(99/130)

December 8, 1999

Ed. Note: The BIS was prescribed as a holder of SDRs by Board of Governors Resolution No. 29-1, effective January 21, 1974.

Ed. Note: Similar decisions were taken for the following entities as holders of SDRs: East Caribbean Currency Authority—Decision No. 6487-(80/77) S, April 18, 1980; Nordic Investment Bank—Decision No. 6488-(80/77) S, April 18, 1980; International Fund for Agricultural Development—Decision No. 6489-(80/77) S, April 18, 1980; Arab Monetary Fund—Decision No. 6609-(80/126) S, August 8, 1980, effective August 26, 1980; International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA)—Decision No. 6718-(81/1) S, December 23, 1980; Central Bank of West African States—Decision No. 6908-(81/101) S, June 29, 1981; Bank of Central African States—Decision No. 7064-(82/26) S, February 26, 1982; Islamic Development Bank-Decision No. 7086-(82/42) S, April 5, 1982; Asian Development Bank—Decision No. 7229-(82/136) S, October 15, 1982; East African Development Bank—Decision No. 7582-(83/174) S, December 15, 1983; Eastern Caribbean Central Bank—Decision No. 7707-(84/79) S, May 17, 1984; African Development Bank and the African Development Fund—Decision No. 8318-(86/104) S, June 25, 1986; European Central Bank—Decision No. 12329-00/113), November 15, 2000.

Ed. Note: A similar decision was taken for the East African Development Bank—Decision No. 13167-(04/2), January 8, 2004.

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