II 

109TH CONGRESS 

1ST SESSION S. 1129 

To provide authorizations of appropriations for certain development banks, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MAY 26, 2005 

Mr. LUGAR (for himself and Mr. HAGEL) introduced the following bill; which 

was read twice and referred to the Committee on Foreign Relations 

A BILL 

To provide authorizations of appropriations for certain 

development banks, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Development Bank Re5 form and Authorization Act of 2005’’. 

6 SEC. 2. FINDINGS. 

7 Congress makes the following findings: 

8 (1) The United States has strong national secu9 rity and humanitarian interests in alleviating pov10 erty and promoting development around the world. 
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1 (2) The World Bank, the African Development 

2 Bank, the Asian Development Bank, the European 

3 Bank for Reconstruction and Development, and the 

4 Inter-American Development Bank leverage the re5 sources that the United States and other donors can 

6 devote to such goals. 

7 (3) Contributions from the United States and 

8 other donors to the multilateral development banks 

9 must be well managed so that the mission of such 

10 banks is fully realized and not undermined by cor11 ruption. Bribes can influence important bank deci12 sions on projects and contractors and misuse of 

13 funds can inflate project costs, cause projects to fail, 

14 and undermine development effectiveness. 

15 (4) Officials of the World Bank have identified 

16 corruption as the single greatest obstacle to eco17 nomic and social development. Corruption under18 mines development by distorting the rule of law and 

19 weakening the institutional foundation on which eco20 nomic growth depends. 

21 (5) Officials of the World Bank have deter22 mined that the harmful effects of corruption are es23 pecially severe on the poor, who are hardest hit by 

24 economic decline, are most reliant on the provision 

25 of public services, and are least capable of paying 
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1 the extra costs associated with bribery, fraud, and 

2 the misappropriation of economic privileges. 

3 (6) In hearings before the Foreign Relations 

4 Committee of the Senate, it was demonstrated 

5 that— 

6 (A) significant multilateral development 

7 bank funding has been lost to corruption and it 

8 is difficult to ascertain such amount precisely, 

9 in part because the multilateral development 

10 banks have not implemented procedures to cal11 culate such amounts, either in the aggregate or 

12 on a country basis; 

13 (B) the multilateral development banks are 

14 taking action to address fraud and corruption 

15 but additional measures remain to be carried 

16 out; 

17 (C) the capability of anti-corruption mech18 anisms are not consistent among the multilat19 eral development banks and divergences in anti20 corruption policies exist that may hinder coordi21 nation on fighting corruption; 

22 (D) weaknesses in whistleblower policy and 

23 practice exist at the multilateral development 

24 banks, to varying degree, that impede anti25 fraud and anti-corruption efforts; 
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1 (E) greater transparency is necessary to 

2 provide effective development aid; 

3 (F) the Secretary of the Treasury encour4 ages anti-corruption efforts at the multilateral 

5 development banks and reviews loans made by 

6 such banks, however, the United States has lim7 ited ability to investigate the misuse of funds 

8 from such banks; and 

9 (G) in some cases, the countries bearing 

10 the cost of prosecuting corruption related to the 

11 multilateral development banks are the coun12 tries that can least afford such costs, for exam13 ple, the Government of Lesotho incurred con14 siderable expense, despite competing priorities, 

15 such as those arising from an HIV/AIDS rate 

16 of more than 25 percent in that country, to in17 vestigate and prosecute fraud and corruption 

18 related to a project that received funding from 

19 the World Bank and the World Bank did not 

20 contribute money towards the prosecution or in21 vestigation. 

22 (7) The General Accounting Office issued a re23 port in 2001 that evaluated the external audit re24 porting of the African Development Bank, the Asian 

25 Development Bank, the European Bank for Recon-
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1 struction and Development, and the Inter-American 

2 Development Bank and a report in 2000 that evalu3 ated the internal controls of the World Bank, and 

4 recommended measures to strengthen such audit re5 porting and controls. 

6 (8) The International Financial Institutions Ad7 visory Commission (also known as the ‘‘Meltzer 

8 Commission’’) concluded in 2000, among other 

9 things, that— 

10 (A) pressure to lend for lending’s sake is 

11 built into the structure of the multilateral devel12 opment banks; 

13 (B) although several of the multilateral de14 velopment banks recognize this problem and 

15 have called attention to the need for change, 

16 there is, at most, weak counterbalance to the 

17 pressure to lend; and 

18 (C) the multilateral development banks’ 

19 systems for project evaluation, performance 

20 evaluation, and project selection must be im21 proved, and that such evaluation should be a re22 petitive process spread over time, including 

23 many years after final disbursement of funds. 

24 SEC. 3. DEFINITIONS. 

25 In this Act: 
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1 (1) APPROPRIATE CONGRESSIONAL COMMIT2 TEES.—The term ‘‘appropriate congressional com3 mittees’’ means the Committee on Foreign Relations 

4 and the Committee on Banking, Housing, and 

5 Urban Affairs of the Senate and the Committee on 

6 International Relations and the Committee on Fi7 nancial Services of the House of Representatives. 

8 (2) GROUP OF 7.—The term ‘‘Group of 7’’ 

9 means Canada, France, Germany, Italy, Japan, the 

10 United Kingdom, and the United States. 

11 (3) GROUP OF 8.—The term ‘‘Group of 8’’ 

12 means the Group of 7 and Russia. 

13 (4) MULTILATERAL DEVELOPMENT BANKS.— 

14 The term ‘‘multilateral development banks’’ means 

15 the African Development Bank, the Asian Develop16 ment Bank, the European Bank for Reconstruction 

17 and Development, the Inter-American Development 

18 Bank, the World Bank, and any subsidiary or affil19 iate of such institutions. 

20 (5) PERSON.—The term ‘‘person’’ includes a 

21 government, a government-controlled entity, a cor22 poration, a company, an association, a firm, a part23 nership, a society, and a joint stock company, as 

24 well as an individual. 
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1 (6) SECRETARY.—Except as otherwise provided, 

2 the term ‘‘Secretary’’ means the Secretary of the 

3 Treasury. 

4 (7) WORLD BANK.—The term ‘‘World Bank’’ 

5 means the International Bank for Reconstruction 

6 and Development, the International Development 

7 Association, the International Finance Corporation, 

8 and the Multilateral Investment Guarantee Agency 

9 and any subsidiary or affiliate of such institutions. 

10 SEC. 4. REFORMS. 

11 (a) AUTHORITY.—The Secretary is authorized to seek 

12 the creation of a pilot program that establishes an Anti13 Corruption Trust at the World Bank, as described in this 

14 section. 

15 (b) PURPOSES.—The purposes of the Anti-Corrup16 tion Trust pilot program shall include— 

17 (1) to assist poor countries in investigations 

18 and prosecutions of fraud and corruption related to 

19 a loan, grant, or credit of the World Bank; and 

20 (2) to determine whether such a program 

21 should be carried out at other multilateral develop22 ment banks. 

23 (c) REPAYMENT OF FUNDS.—If a poor country as24 sesses a fine or receives any renumeration as part of a 

25 prosecution paid for with funds from the Anti-Corruption 
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1 Trust pilot program, such country shall repay the amount 

2 received from the Trust until the total amount received 

3 by such country is repaid. 

4 (d) MONITORING.—The Secretary shall be respon5 sible for establishing a system for monitoring the disburse6 ment and use of funds from the Anti-Corruption Trust 

7 pilot program and promoting access to such funds by poor 

8 countries that are challenged by the high cost of inves9 tigating and prosecuting corruption and fraud linked to 

10 a loan from, or a project funded by, the World Bank. 

11 (e) OTHER DONORS.—The Secretary shall encourage 

12 other donors to the multilateral development banks to con13 tribute funds to the Anti-Corruption Trust. 

14 (f) POOR COUNTRIES DEFINED.—In this section, the 

15 term ‘‘poor countries’’ means countries eligible to borrow 

16 from the International Development Association, as such 

17 eligibility is determined by gross national product per cap18 ita, lack of creditworthiness to borrow on market terms, 

19 and good policy performance. 

20 (g) REPORTS.— 

21 (1) REPORT ON IMPLEMENTATION.—Not later 

22 than September 1, 2006, the Secretary shall submit 

23 to the appropriate congressional committees a report 

24 that describes the actions taken to establish the 

25 Anti-Corruption Trust as described in this section. 
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1 (2) REPORT ON EVALUATION.—Not later than 

2 September 1, 2007, the Secretary shall submit to 

3 the appropriate congressional committees a report 

4 that— 

5 (A) evaluates the effectiveness of the Anti6 Corruption Trust pilot program; and 

7 (B) evaluates the feasibility of establishing 

8 similar trusts at other multilateral development 

9 banks. 

10 (h) AUTHORIZATION OF APPROPRIATIONS.—There is 

11 authorized to be appropriated to the Secretary such sums 

12 as may be necessary for contribution on behalf of the 

13 United States to an Anti-Corruption Trust if a pilot pro14 gram establishing such a Trust is established as described 

15 in this section. 

16 SEC. 5. PROMOTION OF POLICY GOALS AT MULTILATERAL 

17 DEVELOPMENT BANKS. 

18 Title XV of the International Financial Institutions 

19 Act (22 U.S.C. 262o) is amended by adding at the end 

20 the following: 

21 ‘‘SEC. 1505. PROMOTION OF POLICY GOALS. 

22 ‘‘(a) DEFINITIONS.—In this section: 

23 ‘‘(1) APPROPRIATE CONGRESSIONAL COMMIT24 TEES.—The term ‘appropriate congressional com25 mittees’ means the Committee on Foreign Relations 
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1 and the Committee on Banking, Housing, and 

2 Urban Affairs of the Senate and the Committee on 

3 International Relations and the Committee on Fi4 nancial Services of the House of Representatives. 

5 ‘‘(2) MULTILATERAL DEVELOPMENT BANKS.— 

6 The term ‘multilateral development banks’ means 

7 the African Development Bank, the Asian Develop8 ment Bank, the European Bank for Reconstruction 

9 and Development, the Inter-American Development 

10 Bank, the World Bank, and any subsidiary or affil11 iate of such institutions. 

12 ‘‘(3) PERSON.—The term ‘person’ includes a 

13 government, a government-controlled entity, a cor14 poration, a company, an association, a firm, a part15 nership, a society, and a joint stock company, as 

16 well as an individual. 

17 ‘‘(4) SECRETARY.—Except as otherwise pro18 vided, the term ‘Secretary’ means the Secretary of 

19 the Treasury. 

20 ‘‘(5) WORLD BANK.—The term ‘World Bank’ 

21 means the International Bank for Reconstruction 

22 and Development, the International Development 

23 Association, the International Finance Corporation, 

24 and the Multilateral Investment Guarantee Agency, 

25 and any subsidiary or affiliate of such institutions. 
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1 ‘‘(b) TRANSPARENCY.— 

2 ‘‘(1) PUBLICATION OF STATEMENTS.— 

3 ‘‘(A) IN GENERAL.—Not later than 60 cal4 endar days after a meeting of the board of di5 rectors of a multilateral development bank, the 

6 Secretary shall provide for publication on the 

7 Internet Web site of the Department of the 

8 Treasury of— 

9 ‘‘(i) the justification for each vote by 

10 the United States Executive Director at 

11 the multilateral development bank on any 

12 matter before the board of directors of the 

13 bank; and 

14 ‘‘(ii) any written statement presented 

15 at the meeting by such United States Ex16 ecutive Director at the bank concerning— 

17 ‘‘(I) a lending, grant, or guar18 antee operation which would result or 

19 be likely to result in significant social 

20 or environmental effects; 

21 ‘‘(II) an institutional policy or 

22 strategy of the bank that generates 

23 significant public interest, including 

24 operational policies and sector or the25 matic strategies; 
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1 ‘‘(III) a project on which a claim 

2 has been made to the inspection 

3 mechanism of the bank; or 

4 ‘‘(IV) a case pending before the 

5 inspection mechanism of the bank. 

6 ‘‘(B) REDACTED MATERIAL.—The Sec7 retary may redact material from the material to 

8 be made available under subparagraph (A) if 

9 the Secretary determines such material is too 

10 sensitive for public distribution. 

11 ‘‘(2) VOICE AND VOTE.—The Secretary shall in12 struct the United States Executive Director at each 

13 multilateral development bank to inform the bank of 

14 the publication policy described in paragraph (3), 

15 and use the voice and vote of the United States to 

16 implement such policy. 

17 ‘‘(3) PUBLICATION POLICY.— 

18 ‘‘(A) IN GENERAL.—The publication policy 

19 referred to in paragraph (2) is a policy that 

20 each multilateral development bank shall— 

21 ‘‘(i) make available to the public, in22 cluding on the Internet Web site of such 

23 bank, the loan, credit, and grant docu24 ments, country assistance strategies, sector 

25 strategies, and sector policies prepared by 
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1 the bank that are to be presented for en2 dorsement or approval by the board of di3 rectors of the bank, 15 calendar days prior 

4 to the date that such document, strategy, 

5 or policy will be considered by the board 

6 or, if not available at that time, at the time 

7 the documents are distributed to the 

8 board; 

9 ‘‘(ii) make available to the public all 

10 draft country strategies 120 calendar days 

11 prior to consideration of such strategies by 

12 the board of directors of the bank; 

13 ‘‘(iii) make a concerted effort to dis14 tribute paper copies of the material re15 ferred to in clauses (i) and (ii) to commu16 nities affected by the documents referred 

17 to in such clauses; 

18 ‘‘(iv) make available to the public, in19 cluding on the Internet Web site of such 

20 bank, the minutes of a meeting of the 

21 board of directors of the bank, not later 

22 than 60 calendar days after the date that 

23 the bank approves the minutes of the 

24 board meeting; 
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1 ‘‘(v) make available to the public, in2 cluding on the Internet Web site of such 

3 bank, a summary of discussion of the 

4 meeting of the board of directors of the 

5 bank, not later than 90 calendar days after 

6 the date of the meeting; 

7 ‘‘(vi) keep a written transcript or elec8 tronic recording of each meeting of its 

9 board of directors and preserve the tran10 script or recording for not less than 10 

11 years after the date of such meeting; and 

12 ‘‘(vii) make available to the public a 

13 written transcript or an electronic record14 ing of a meeting of the board of directors 

15 of the bank during the 5-year period begin16 ning on the date that is 5 years after the 

17 date of the meeting. 

18 ‘‘(B) REDACTED MATERIAL.—The presi19 dent of a multilateral development bank may 

20 redact material from the material to be made 

21 available under subparagraph (A) if the presi22 dent of a multilateral development bank deter23 mines such material is too sensitive for public 

24 distribution. 
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1 ‘‘(c) STRENGTHENING DEVELOPMENT BANK ADMIN2 ISTRATION.—The Secretary shall instruct the United 

3 States Executive Director at each multilateral develop4 ment bank to inform the bank of, and use the voice and 

5 vote of the United States to achieve at the bank, the fol6 lowing United States policy goals: 

7 ‘‘(1) Each multilateral development bank shall 

8 require mandatory financial disclosure of any pos9 sible or apparent conflict of interest by each em10 ployee of the bank, consultant to the bank, or inde11 pendent expert to the bank whose duties and respon12 sibilities include, through decision or the exercise of 

13 judgment, the taking of any action regarding— 

14 ‘‘(A) contracting or procurement; 

15 ‘‘(B) developing, administering, managing, 

16 or monitoring loans, grants, programs, projects, 

17 subsidies, or other conferred financial or oper18 ational benefits provided by the bank; or 

19 ‘‘(C) evaluating or auditing any project, 

20 program or entity. 

21 ‘‘(2) Each multilateral development bank shall 

22 reform the ‘pressure to lend’ incentive structure at 

23 such bank by linking project design and implementa24 tion to staff performance appraisals and shall re-
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1 quire that staff increase its focus on monitoring ex2 isting loans. 

3 ‘‘(3) Each multilateral development bank shall 

4 continue strengthening whistleblower policies at the 

5 bank to the level of emerging standards for national 

6 and international law in the Sarbanes-Oxley Act of 

7 2002 (15 U.S.C. 7201 et seq.), the Inspector Gen8 eral Act of 1978 (5 U.S.C. App.), and the model ap9 proved for member nations by the Organization of 

10 American States to implement the Inter-American 

11 Convention Against Corruption, done at Caracas on 

12 March 29, 1996. 

13 ‘‘(4) All loan, credit, guarantee, and grant doc14 uments and other agreements with borrowers shall 

15 include provisions for the financial resources and 

16 conditionality necessary to ensure that a person who 

17 obtains financial support from a multilateral devel18 opment bank complies with applicable bank policies 

19 and national and international laws in carrying out 

20 the terms and conditions of such documents and 

21 agreements, including bank policies and national and 

22 international laws pertaining to the comprehensive 

23 assessment and transparency of the activities sup24 ported, such as those concerning public consultation, 
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1 access to information, public health, safety, and en2 vironmental protection. 

3 ‘‘(5) Each multilateral development bank shall 

4 develop clear procedures setting forth the cir5 cumstances under which a person will be barred 

6 from receiving a loan, contract, grant, or credit from 

7 such bank, shall make such procedures available to 

8 the public, and shall make the identities of such per9 son available to the public. 

10 ‘‘(6) Each multilateral development bank shall 

11 coordinate policies across international institutions 

12 on issues including debarment, cross-debarment, 

13 procurement and consultant guidelines, and fidu14 ciary standards so that a person that is debarred by 

15 one multilateral development bank is automatically 

16 declared ineligible to conduct business with the other 

17 multilateral development banks during the specified 

18 ineligibility period. 

19 ‘‘(d) ANTI-CORRUPTION PRACTICES.— 

20 ‘‘(1) VOICE AND VOTE.—The Secretary shall in21 struct the United States Executive Director at each 

22 multilateral development bank to inform the bank of 

23 the United States anti-corruption policy described in 

24 paragraph (2), and use the voice and vote of the 

25 United States to implement such policy at the bank. 
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1 ‘‘(2) ANTI-CORRUPTION POLICY.—The anti-cor2 ruption policy referred to in paragraph (1) is the 

3 United States policy that a person that receives 

4 money from a multilateral development bank shall 

5 sign a code of conduct that embodies the standards 

6 set out in section 104 of the Foreign Corrupt Prac7 tices Act of 1977 (15 U.S.C. 78dd–2), and that pro8 hibits such person from corruptly in furtherance of 

9 an offer, payment, promise to pay, or authorization 

10 of the payment of any money, or offer, gift, promise 

11 to give, or authorization of the giving of anything of 

12 value to any official for purposes, directly or indi13 rectly— 

14 ‘‘(A)(i) influencing any act or decision of 

15 such official in his or her official capacity; 

16 ‘‘(ii) supporting any political party, polit17 ical entity, any official of a political party, or 

18 any candidate for political office; 

19 ‘‘(iii) inducing such official to do or omit 

20 to do any act in violation of the lawful duty of 

21 such official; or 

22 ‘‘(iv) securing any improper advantage; or 

23 ‘‘(B) inducing such official to use the offi24 cial’s influence with a government or instru25 mentality thereof, to affect or influence any act 
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1 or decision of such government or instrumen2 tality, 

3 in order to assist such person in obtaining or retain4 ing business for or with, or directing business to, 

5 any other person. 

6 ‘‘(e) STRENGTHENING DEVELOPMENT BANK AUDIT7 ING.— 

8 ‘‘(1) VOICE AND VOTE.—The Secretary shall in9 struct the United States Executive Director at each 

10 multilateral development bank to inform the bank of, 

11 and use the voice and vote of the United States to 

12 achieve at the bank, the following United States pol13 icy goals: 

14 ‘‘(A) Each multilateral development bank 

15 shall— 

16 ‘‘(i) establish an independent Office of 

17 an Inspector General, establish or 

18 strengthen an independent auditing func19 tion at the bank, and require that the In20 spector General and the auditing function 

21 report directly to the board of directors of 

22 the bank; and 

23 ‘‘(ii) adopt and implement an inter24 nationally recognized internal controls 

25 framework, allocate adequate staffing to 
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1 auditing and supervision, require external 

2 audits of internal controls, and external 

3 and forensic audits of loans where fraud is 

4 suspected. 

5 ‘‘(B) Each multilateral development bank 

6 shall establish a plan and schedule for con7 ducting regular, independent audits of internal 

8 management controls and procedures for meet9 ing operational objectives, complying with the 

10 policies of such bank, and preventing fraud, and 

11 making reports describing the scope and find12 ings of such audits available to the public. 

13 ‘‘(C) Each multilateral development bank 

14 shall establish effective procedures for the re15 ceipt, retention, and treatment of— 

16 ‘‘(i) complaints received by the bank 

17 regarding fraud, accounting, mismanage18 ment, internal accounting controls, or au19 diting matters; and 

20 ‘‘(ii) the confidential, anonymous sub21 mission, particularly by employees of the 

22 bank, of concerns regarding fraud, ac23 counting, mismanagement, internal ac24 counting controls, or auditing matters. 
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1 ‘‘(D) Each multilateral development bank 

2 shall post on the Internet Web site of such 

3 bank an annual report containing statistical 

4 summaries and case studies of the fraud and 

5 corruption cases pursued by the bank’s inves6 tigations unit. 

7 ‘‘(f) COMPENSATION PACKAGES FOR PEOPLE NEGA8 TIVELY AFFECTED BY DEVELOPMENT BANK

9 PROJECTS.— 

10 ‘‘(1) VOICE AND VOTE.—The Secretary shall in11 struct the United States Executive Director at each 

12 multilateral development bank to inform the bank of 

13 the United States policy goals related to compensa14 tion described in paragraph (2), and use the voice 

15 and vote of the United States to implement such 

16 policy at the bank. 

17 ‘‘(2) COMPENSATION POLICY.—The compensa18 tion policy referred to in paragraph (1) is a policy 

19 that each multilateral development bank shall, for 

20 each project funded by the bank where compensa21 tion, including resettlement or rehabilitation assist22 ance, is to be provided to persons adversely impacted 

23 by the project, require that an independent mecha24 nism be established for, or included in the design of, 

25 the project to receive and adjudicate complaints 
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1 from a person who is eligible for compensation if 

2 such person, not more than 6 years after the date 

3 of the completion of the project, finds that the com4 pensation is either inadequate or improperly imple5 mented. 

6 ‘‘(g) EVALUATION.—The Secretary shall instruct the 

7 United States Executive Director at each multilateral de8 velopment bank to inform the bank of, and use the voice 

9 and vote of the United States to achieve at the bank, the 

10 following goals: 

11 ‘‘(1) Each multilateral development bank shall 

12 make the results of project and non-project oper13 ations evaluations available to the public, including 

14 through the Internet Web site of the bank and in15 cluding information on the quantity of projects eval16 uated per year as a percentage of total projects car17 ried out. 

18 ‘‘(2) Each multilateral development bank shall 

19 require that all loans, grants, credits, policies, and 

20 strategies, including budget support, prepared by the 

21 bank include specific outcome and output indicators 

22 to measure results, and that the indicators and re23 sults be published periodically during the execution 

24 and at the completion of the appropriate project or 

25 program, and at the number of years after such 
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1 completion determined to be appropriate for such 

2 loan, grant, credit, policy, or strategy. 

3 ‘‘(3) Each multilateral development bank shall 

4 promote rigorous evaluation of projects and policies 

5 to ensure that the intent of such projects and poli6 cies is realized. Such a bank shall favor grants and 

7 loans to applicants who agree, in consultation with 

8 an independent evaluator or evaluators, to design 

9 projects to facilitate the evaluation of outcomes. Rig10 orous evaluations shall measure the impact on those 

11 served by a loan, grant, or credit and shall have a 

12 carefully constructed comparison group to help 

13 measure the impacts of the loan, grant, or credit. 

14 ‘‘(h) QUALIFICATION POLICY.— 

15 ‘‘(1) VOICE AND VOTE.—The Secretary shall in16 struct the United States Executive Director at each 

17 multilateral development bank to encourage the 

18 bank to implement the qualification policy for bor19 rowing countries described in paragraph (2), and use 

20 the voice and vote of the United States to achieve 

21 such policy at each bank. 

22 ‘‘(2) QUALIFICATION POLICY FOR BORROWING

23 COUNTRIES.—The qualification policy for borrowing 

24 countries referred to in paragraph (1) is a policy 

25 that requires, in addition to the standards in effect 
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1 on the date of the enactment of the Development 

2 Bank Reform and Authorization Act of 2005, each 

3 multilateral development bank to qualify a country 

4 for budget support, adjustment lending, policy lend5 ing for non-project loans, grants, or credits, or other 

6 loans directed to the country’s budget based on 

7 transparency in procurement and fiduciary require8 ments and requiring the borrowing country to make 

9 its budget available to the public before funds are 

10 disbursed to that country. 

11 ‘‘(i) MICROFINANCE AND BUSINESS DEVELOP12 MENT.—The Secretary shall inform the management of 

13 each multilateral development bank and the public that 

14 it is the policy of the United States to encourage micro15 finance services for the poor and very poor (as that term 

16 is defined in section 259 of the Foreign Assistance Act 

17 of 1961 (22 U.S.C. 2214a)), and micro-, small-, and me18 dium-enterprise development programs, particularly in a 

19 country where the government of such country ranks poor20 ly in the World Bank Institute’s governance indicators. 

21 ‘‘(j) RESOURCE DEPENDENT COUNTRY REVENUE

22 TRANSPARENCY.— 

23 ‘‘(1) REQUIREMENTS FOR RESOURCE ASSIST24 ANCE FOR A GOVERNMENT.—The Secretary shall in25 form the management of each multilateral develop-
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1 ment bank and the public that it is the policy of the 

2 United States that any assistance provided by a 

3 such bank including any investment, loan, credit, 

4 grant, or guarantee, to a government of a resource5 dependent country or for any project located in a re6 source-dependent country, other than humanitarian 

7 assistance, assistance to address HIV/AIDS, tuber8 culosis, malaria or food aid, may not be provided un9 less the government has in place or is taking the 

10 necessary steps to establish functioning systems 

11 for— 

12 ‘‘(A) accurately accounting for all revenues 

13 received by a borrowing government from a per14 son and all payments to a government in con15 nection with the extraction or export of natural 

16 resources, such as gas, oil, oil shale, tar sands, 

17 coal, any metal, mineral, or timber; 

18 ‘‘(B) the independent auditing of such pay19 ments and such revenues by a credible, inde20 pendent auditor, applying international auditing 

21 standards, and the widespread regular public 

22 dissemination of the auditor’s findings, includ23 ing a reconciliation of aggregate payments and 

24 revenues; 
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1 ‘‘(C) verifying such revenues against the 

2 records for such payments made by each per3 son, including widespread dissemination of ag4 gregate payment information in a manner that 

5 protects proprietary information, that observes 

6 the law of the borrowing country, and that the 

7 person determines does not cause substantial 

8 competitive harm; 

9 ‘‘(D) making available to the public all 

10 contracts between the government of such coun11 try or any person owned or controlled by such 

12 government, and any person that is engaged in 

13 the extraction or export of natural resources 

14 through a project or program supported by a 

15 bank, unless the person determines such disclo16 sure would cause substantial competitive harm; 

17 ‘‘(E) applying the revenue transparency 

18 approach described in this paragraph equally 

19 and fully to all extractive industry companies 

20 operating in the country, including state-owned 

21 entities; and 

22 ‘‘(F) establishing a legal framework for 

23 disclosure of payments from a person or con24 tracts with a person and outlining the level and 
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1 extent of disclosure or payment information by 

2 companies in the extractive industries. 

3 ‘‘(2) REQUIREMENTS FOR OTHER NATURAL RE4 SOURCE ASSISTANCE.—The Secretary shall inform 

5 the management of each multilateral development 

6 bank and the public that it is the policy of the 

7 United States that any assistance, including any in8 vestment, loan, or guarantee, provided by such a 

9 bank to private sector sponsors for the extraction or 

10 export of natural resources in a resource-dependent 

11 country shall only be provided if the government of 

12 the country has in place or is taking necessary steps 

13 to establish the functioning systems described in 

14 subparagraphs (A) through (F) in paragraph (1) 

15 and if the private sector sponsors of such projects 

16 publicly disclose revenue payments made to the gov17 ernment of such country, in accordance with the 

18 laws of such country regarding the required level 

19 and extent of such disclosure. 

20 ‘‘(3) COMPLIANCE WITH TRANSPARENCY

21 GUIDELINES PRIOR TO APPROVAL OF ASSISTANCE.— 

22 In furtherance of the policy described in paragraph 

23 (1), not later than 2 years after the date of the en24 actment of the Development Bank Reform and Au25 thorization Act of 2005, the Secretary shall inform 
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1 the management of each multilateral development 

2 bank and the public that it is the policy of the 

3 United States that any assistance by such a bank, 

4 including any investment, loan, credit, grant, or 

5 guarantee, other than humanitarian assistance, as6 sistance to address HIV/AIDS, tuberculosis, or ma7 laria or to provide food, to any government of a re8 source-dependent country or for any project located 

9 in such country, shall not be provided unless the 

10 bank, prior to the approval of such assistance, has— 

11 ‘‘(A) determined that the government has 

12 in place the systems described in subparagraphs 

13 (A) through (F) of paragraph (1), based on all 

14 information that is relevant, applicable and rea15 sonably available to the bank, including, the 

16 views of other international financial institu17 tions active in such country and the views of 

18 civil society organizations that are active within 

19 and outside such country; 

20 ‘‘(B) determined that private sector spon21 sors of projects for the extraction and export of 

22 natural resources have agreed to publicly dis23 close revenue payments to host governments; 

24 and 
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1 ‘‘(C) made available to the public the find2 ings and conclusions identifying the information 

3 taken into consideration in making such deter4 minations and the reasons for such determina5 tions. 

6 ‘‘(4) RESOURCE-DEPENDENT COUNTRY DE7 FINED.—In this subsection, the term ‘resource-de8 pendent country’ means a country that has— 

9 ‘‘(A) an average share of natural resource10 derived fiscal revenues of at least 25 percent of 

11 the total fiscal revenues during the preceding 3- 

12 year period; or 

13 ‘‘(B) an average share of natural resource 

14 export proceeds of at least 25 percent of the 

15 total export proceeds during the preceding 3- 

16 year period.’’. 

17 SEC. 6. SENSE OF CONGRESS ON THE EXTRACTIVE INDUS18 TRY TRANSPARENCY INITIATIVE AND G–8 

19 AGREEMENTS. 

20 It is the sense of Congress that— 

21 (1) the President should continue promoting 

22 the Extractive Industry Transparency Initiative as 

23 one approach to help ensure that the revenues from 

24 extractive industries contribute to sustainable devel-
30 

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1 opment and poverty reduction, as such Initiative is 

2 a voluntary initiative intended— 

3 (A) to promote greater transparency of de4 veloping country government revenues and ex5 penditures, procurement, concession-granting 

6 systems; and 

7 (B) to work to recover stolen assets and 

8 enforce antibribery laws; 

9 (2) the United States should encourage the con10 tinued work of the G–8 to promote the Extractive 

11 Industries Transparency Initiative; and 

12 (3) the United States should support and en13 courage the carrying out of the agreements of the 

14 G–8 made at the 2004 Summit at Sea Island, Geor15 gia, and at the 2003 Summit at Evian, France, to 

16 promote transparency in public budgets, including 

17 revenues and expenditures, government procurement, 

18 public concessions, the granting of licenses with spe19 cial emphasis on countries with large extractive in20 dustries sectors, including the agreements made at 

21 the Summit at Sea Island which specifically— 

22 (A) support the efforts of the Public Ex23 penditure and Financial Accountability program 

24 at the World Bank to help developing countries 

25 achieve accountability in public finance and ex-
31 

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1 penditure and to extend harmonized approaches 

2 to the assessment and reform of their public fi3 nancial, accountability, and procurement sys4 tems; 

5 (B) invite developing countries to prepare 

6 anticorruption action plans to implement the 

7 commitments of such countries in regional and 

8 international conventions; and 

9 (C) achieve agreement on full disclosure of 

10 the World Bank International Development As11 sociation’s Country Policy and Institutional As12 sessment results, with disclosure to begin with 

13 the 2005 ratings. 

14 SEC. 7. REPORTS FROM THE GOVERNMENT ACCOUNT15 ABILITY OFFICE. 

16 (a) SENSE OF CONGRESS ON ACCESS TO INFORMA17 TION.—It is the sense of Congress that— 

18 (1) to evaluate the compliance of the multilat19 eral development banks with the policies of the 

20 United States described in section 1505 of the Inter21 national Financial Institutions Act, as added by sec22 tion 5 of this Act, and to prepare the reports re23 quired by this section, the Comptroller General of 

24 the United States should have full and complete ac25 cess to financial information relating to the multilat-
32 

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1 eral development banks, including information re2 lated to the performance, accountability, oversight, 

3 financial transactions, organization, and activities of 

4 the multilateral development banks; 

5 (2) the Secretary should seek to conclude mem6 orandums of understanding with the multilateral de7 velopment banks to ensure that the United States 

8 will have access to documents related to information 

9 described in paragraph (1); and 

10 (3) the Secretary of the Treasury should facili11 tate access by the Comptroller General of the United 

12 States to the financial information described in 

13 paragraph (1). 

14 (b) REPORT ON EFFECTIVENESS OF MULTILATERAL

15 DEVELOPMENT BANKS.—Not later than 3 years after the 

16 date of the enactment of this Act, the Comptroller General 

17 of the United States shall— 

18 (1) conduct a review of the effectiveness of each 

19 multilateral development bank in achieving the mis20 sion of such bank as set out in the articles of agree21 ment of such bank, specifically poverty reduction 

22 and economic development; and 

23 (2) submit to the appropriate congressional 

24 committees a report on the findings of the review. 
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1 (c) REPORT ON CONSISTENCY OF MULTILATERAL

2 DEVELOPMENT BANK PRACTICES WITH STATUTORY

3 POLICIES.—Not later than 3 years after the date of the 

4 enactment of this Act, the Comptroller General of the 

5 United States shall prepare and submit to the appropriate 

6 congressional committees a report on the extent to which 

7 the practices of the multilateral development banks are 

8 consistent with the policies of the United States, as ex9 pressly contained in Federal law applicable to the multilat10 eral development banks. 

11 (d) REPORT ON REFORMS AT THE MULTILATERAL

12 DEVELOPMENT BANKS.—Not later than 1 year after the 

13 date of the enactment of this Act, the Comptroller General 

14 of the United States shall prepare and submit to the ap15 propriate congressional committees a report on the extent 

16 of the implementation of the reforms called for by the 

17 Group of 8 or by the Group of 7, starting with the 2000 

18 Okinawa Summit, as delineated in communique ́s, chair19 man’s statements, and other official communication 

20 through the summit or finance ministerial processes of the 

21 Group of 8 or the Group of 7. 
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1 SEC. 8. CONTRIBUTIONS TO MULTILATERAL DEVELOP2 MENT BANKS. 

3 (a) WORLD BANK.—The International Development 

4 Association Act (22 U.S.C. 284 et seq.) is amended by 

5 adding at the end the following new section: 

6 ‘‘SEC. 23. FOURTEENTH REPLENISHMENT. 

7 ‘‘(a) CONTRIBUTION AUTHORITY.— 

8 ‘‘(1) IN GENERAL.—The United States Gov9 ernor of the Association is authorized to contribute 

10 on behalf of the United States $2,850,000,000 to 

11 the fourteenth replenishment of the resources of the 

12 Association. 

13 ‘‘(2) SUBJECT TO APPROPRIATIONS.—Any com14 mitment to make the contribution authorized by 

15 paragraph (1) shall be effective only to such extent 

16 or in such amounts as are provided in advance in 

17 appropriations Acts. 

18 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—For the 

19 contribution authorized by subsection (a), there are au20 thorized to be appropriated, without fiscal year limitation, 

21 $2,850,000,000 for payment by the Secretary of the 

22 Treasury.’’. 

23 (b) AFRICAN DEVELOPMENT BANK FUND.—The Af24 rican Development Fund Act (22 U.S.C. 290g et seq.) is 

25 amended by adding at the end the following new section: 
35 

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1 ‘‘SEC. 218. TENTH REPLENISHMENT. 

2 ‘‘(a) CONTRIBUTION AUTHORITY.— 

3 ‘‘(1) IN GENERAL.—The United States Gov4 ernor of the Fund is authorized to contribute on be5 half of the United States $407,000,000 to the tenth 

6 replenishment of the resources of the Fund. 

7 ‘‘(2) SUBJECT TO APPROPRIATIONS.—Any com8 mitment to make the contribution authorized by 

9 paragraph (1) shall be effective only to such extent 

10 or in such amounts as are provided in advance in 

11 appropriations Acts. 

12 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—For the 

13 contribution authorized by subsection (a), there are au14 thorized to be appropriated, without fiscal year limitation, 

15 $407,000,000 for payment by the Secretary of the Treas16 ury.’’. 

17 (c) ASIAN DEVELOPMENT FUND OF THE ASIAN DE18 VELOPMENT BANK.—The Asian Development Bank Act 

19 (22 U.S.C. 285 et seq.) is amended by adding at the end 

20 the following new section: 

21 ‘‘SEC. 32. EIGHTH REPLENISHMENT. 

22 ‘‘(a) CONTRIBUTION AUTHORITY.— 

23 ‘‘(1) IN GENERAL.—The United States Gov24 ernor of the Bank is authorized to contribute on be25 half of the United States $461,000,000 to the eighth 

26 replenishment of the resources of the Fund. 
36 

•S 1129 IS

1 ‘‘(2) SUBJECT TO APPROPRIATIONS.—Any com2 mitment to make the contribution authorized by 

3 paragraph (1) shall be effective only to such extent 

4 or in such amounts as are provided in advance in 

5 appropriations Acts. 

6 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—For the 

7 contribution authorized by subsection (a), there are au8 thorized to be appropriated, without fiscal year limitation, 

9 $461,000,000 for payment by the Secretary of the Treas10 ury.’’. 

11 SEC. 9. ANNUAL REPORTS. 

12 (a) INITIAL REPORT.—Not later than September 1, 

13 2006, the Secretary shall submit a report to the appro14 priate congressional committees the describes the actions 

15 taken by the United States Executive Director at each 

16 multilateral development bank to implement the policy 

17 goals described in this Act and the amendments made by 

18 this Act and any other actions that should be taken to 

19 implement such goals. 

20 (b) UPDATES.—The Secretary shall submit to the ap21 propriate congressional committees an annual update of 

22 the report required by subsection (a) for each of the fiscal 

23 years 2007, 2008, and 2009. 

Æ