SECTION 1- Joint action 

     Representatives of the participants shall meet from time to time for the purpose of giving effect to those provisions of this Agreement which involve joint action and, generally, with a view to facilitating the operation and furthering the objectives of this Agreement. Whenever reference is made in this Agreement to the participants acting jointly, they are designated as the Board of Directors.

SECTION 2- The Board of Directors

     (a) Each participant shall appoint one Director and one Alternate Director to represent it on the Board of Directors. Each Director and Alternate Director shall be appointed for a term of two years, may be reappointed, and may be replaced at any time during the term of his appointment. Each Director shall have one vote. An Alternate Director may attend the meetings but may vote only when his principal is not present or when his principal is acting as the Chairman. The Board shall elect a Chairman from among its members to serve for a period of one year, and a Vice-Chairman to serve in the absence or inability of the Chairman during the same period.

    (b) The Board of Directors shall meet at least once in a calendar year. In addition, meetings of the Board shall be called by the Chairman when requested by two Directors or when the Chairman considers a meeting necessary.

    (c) A quorum for any meeting of the Board of Directors shall be the Chairman or Vice-Chairman and two-thirds of the Directors.

    (d) All decisions of the Board of Directors shall be taken by a majority of the votes of all of the Directors unless a special majority is required by this Agreement. The votes of "all of the Directors" mean the votes of all the Directors and not merely of those present and voting. When both a Director and his Alternate are not present at a meeting of the Board, the Director, in accordance with rules established by the Board, may authorize another Director to present his views and to cast his vote. The Chairman shall have no vote, except in the case of an equal division when he shall cast the deciding vote.

    (e) The Board of Directors may establish a procedure whereby the Chairman may obtain the votes of the Directors on a specific question without calling a meeting of the Board.

    (f) The Board of Directors may adopt such rules and regulations as are necessary for the organization and operation of the Asian Clearing Union.

    (g) The remuneration and expenses of a Director and Alternate Director shall be borne by the participant appointing them. 

SECTION 3-Secretary General and staff 

     (a) The Board of Directors, by a two-thirds majority of all of the Directors, shall select and appoint the Secretary General, who shall not be a Director, for a term of three years. The Board shall establish the remuneration and other terms of the contract of service of the Secretary General. The Secretary General may be reappointed and shall cease to hold office when the Board so decides by a two-thirds vote of all of the Directors.

    (b) The Secretary General, under the direction of the Board of Directors shall conduct the ordinary business of the Asian Clearing Union. He shall be the head of the staff and, subject to the general rules of the Board, organize, appoint and dismiss members of the staff. He shall exercise such other powers as are assigned to him by the Board.

    (c) The Secretary General shall prepare and submit to the Board the documents necessary for its work particularly the financial statements, the proposed annual budget and the draft annual report.

    (d) The Secretary General shall act as the representative of the Board of Directors within the limits prescribed by the Board.

    (e) The Secretary General and the staff members, in the discharge of their official functions, shall owe their duty entirely to the Board of Directors and to no other authority. Each participant in the Asian Clearing Union shall respect the international charter of this duty and shall refrain from all attempts to influence any of the staff in the discharge of his functions.



     The Board of Directors may make arrangements with a central bank or monetary authority of a participant or with the Asian Reserve Bank when it is established to provide the necessary services and facilities for the operation of the clearing facility. The agreement establishing these arrangements with an Agent must be approved by a vote of two-thirds of all of the Directors.



     The Board of Directors may make arrangements to co-operate with other general, regional or sub-regional international organizations or other clearing arrangements among countries within or outside the ESCAP region. Any such arrangement shall not apply to a participant which does not consent.


     (a) Any question of interpretation of this Agreement or of any rules, regulations or decisions of the Board of Directors arising between the Secretary General and a participant or between participants shall be decided by the Board whose decision shall be final.

     (b) Should any dispute, out of or in connection with the Agreement Establishing the Asian Clearing Union and Procedure Rules, arise between the participants or between the Participants and the Board, and if efforts to settle the controversy by negotiating fail, such dispute shall be submitted to arbitration by a tribunal of three arbitrators, the first and second appointed by the parties to the dispute, and the third designated by the first two arbitrators. If they fail to reach agreement, the third arbitrator shall be appointed by the Executive Secretary of ESCAP. The third arbitrator shall be empowered to decide all matters of procedure whenever the other two arbitrators disagree with respect to such a question. The place of arbitration shall be decided by the parties to the dispute. The language of arbitration shall be English. Every effort shall be made to settle the controversy within a period of six months after service of a written request to the arbitration.


SECTION 1- Reports 

     The Board of Directors shall publish an annual report on its activities and the operations of the Asian Clearing Union. The report shall contain an audited statement of accounts and of the clearing operations. The Board may publish such other reports as it deems desirable.

SECTION 2- Operating expenses

     (a) The Board of Directors shall approve the annual budget and determine the formula under which expenses shall be apportioned among participants, on the basis of the actual use made of the Asian Clearing Union and of the services rendered to them.

     (b) The Board shall specify the currencies or other means in which the assessments shall be paid by members as well as the schedule of payments for each fiscal year.

     (c) The Board of Directors may request the Agent to make an advance to the Asian Clearing Union on behalf of the participants when such action becomes necessary to meet expenses, but the Board shall promptly make an assessment to meet the amount borrowed.

     (d) All the decisions taken by the Board of Directors in accordance with this section shall require the affirmative vote of two-thirds of all of the Directors.






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