I
105TH CONGRESS
2D SESSION
H. R. 4150
To appropriate funds necessary for United States participation in a quota
increase and the New Arrangements to Borrow of the International
Monetary Fund, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 25, 1998
Mr. STENHOLM (for himself, Mr. DOOLEY of California, Mr. MINGE, Mr. BOS-
WELL, and Mr. ETHERIDGE) introduced the following bill; which was re-
ferred to the Committee on Banking and Financial Services
A BILL
To appropriate funds necessary for United States participa-
tion in a quota increase and the New Arrangements
to Borrow of the International Monetary Fund, and for
other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
That the following sums are appropriated, out of any
money in the Treasury not otherwise appropriated, for the
International Monetary Fund for the fiscal year ending
September 30, 1998, and for other purposes, namely:
MULTILATERAL ECONOMIC ASSISTANCE
FUNDS APPROPRIATED TO THE PRESIDENT
LOANS TO INTERNATIONAL MONETARY FUND
NEW ARRANGEMENTS TO BORROW
For loans to the International Monetary Fund
(Fund) under the New Arrangements to Borrow, the dol-
lar equivalent of 2,462,000,000 Special Drawing Rights,
to remain available until expended; in addition, up to the
dollar equivalent of 4,250,000,000 Special Drawing
Rights previously appropriated by the Act of November
30, 1983 (Public Law 98–181), and the Act of October
23, 1962 (Public Law 87–872), for the General Arrange-
ments to Borrow, may also be used for the New Arrange-
ments to Borrow.
UNITED STATES QUOTA
For an increase in the United States quota in the
International Monetary Fund, the dollar equivalent of
10,622,500,000 Special Drawing Rights, to remain avail-
able until expended.
GENERAL PROVISIONS
SEC. 101. CONDITIONS FOR THE USE OF QUOTA RE-
SOURCES. (a) None of the funds appropriated in this Act
under the heading ‘‘United States Quota, International
Monetary Fund’’ may be obligated, transferred or made
available to the International Monetary Fund until 30
days after the Secretary of the Treasury certifies that the
major shareholders of the International Monetary Fund,
including the United States, Japan, the Federal Republic
of Germany, France, Italy, the United Kingdom, and Can-
ada have publicly agreed to, and will seek to implement
in the Fund, policies that provide for conditions in stand-
by agreements or other arrangements regarding the use
of Fund resources, requiring that the recipient country—
(1) liberalize restrictions on trade in goods and
services and on investment, at a minimum consistent
with the terms of all international trade obligations
and agreements; and
(2) to eliminate the practice or policy of govern-
ment directed lending on non-commercial terms or
provision of market distorting subsidies to favored
industries, enterprises, parties, or institutions.
(b) Subsequent to the certification provided in sub-
section (a), in conjunction with the annual submission of
the President’s budget, the Secretary of the Treasury shall
report to the appropriate committees on the implementa-
tion and enforcement of the provisions in subsection (a).
(c) The United States shall exert its influence with
the Fund and its members to encourage the Fund to in-
clude as part of its conditions of stand-by agreements or
other uses of the Fund’s resources that the recipient coun-
try take action to remove discriminatory treatment be-
tween foreign and domestic creditors in its debt resolution
proceedings. The Secretary of the Treasury shall report
back to the Congress six months after the enactment of
this Act, and annually thereafter, on the progress in
achieving this requirement.
(d) BANKRUPTCY LAW REFORM.—The United States
shall exert its influence with the International Monetary
Fund and its members to encourage the International
Monetary Fund to include as part of its conditions of as-
sistance that the recipient country take action to adopt,
as soon as possible, modern insolvency laws that—
(1) emphasize reorganization of business enter-
prises rather than liquidation whenever possible;
(2) provide for a high degree of flexibility of ac-
tion, in place of rigid requirements of form or sub-
stance, together with appropriate review and ap-
proval by a court and a majority of the creditors in-
volved;
(3) include provisions to ensure that assets
gathered in insolvency proceedings are accounted for
and put back into the market stream as quickly as
possible in order to maximize the number of busi-
nesses that can be kept productive and increase the
number of jobs that can be saved; and
(4) promote international cooperation in insol-
vency matters by including—
(A) provisions set forth in the Model Law
on Cross-Border Insolvency approved by the
United Nations Commission on International
Trade Law, including removal of discriminatory
treatment between foreign and domestic credi-
tors in debt resolution proceedings; and
(B) other provisions appropriate for pro-
moting such cooperation.
The Secretary of the Treasury shall report back to Con-
gress six months after the enactment of this Act, and an-
nually, thereafter, on the progress in achieving this re-
quirement.
(e) Nothing in this section shall be construed to cre-
ate any private right of action with respect to the enforce-
ment of its terms.
SEC. 102. TRANSPARENCY AND OVERSIGHT. (a) Not
later than 30 days after enactment of this Act, the Sec-
retary of the Treasury shall certify to the appropriate
committees that the Board of Executive Directors of the
International Monetary Fund has agreed to provide timely
access by the Comptroller General to information and doc-
uments relating to the Fund’s operations, program and
policy reviews and decisions regarding stand-by agree-
ments and other uses of the Fund’s resources.
(b) The Secretary of the Treasury shall direct, and
the U.S. Executive Director to the International Monetary
Fund shall agree to—
(1) provide any documents or information avail-
able to the Director that are requested by the Comp-
troller General;
(2) request from the Fund any documents or
material requested by the Comptroller General; and
(3) use all necessary means to ensure all pos-
sible access by the Comptroller General to the staff
and operations of the Fund for the purposes of con-
ducting financial and program audits.
(c) The Secretary of the Treasury, in consultation
with the Comptroller General and the U.S. Executive Di-
rector of the Fund, shall develop and implement a plan
to obtain timely public access to information and docu-
ments relating to the Fund’s operations, programs and
policy reviews and decisions regarding stand-by agree-
ments and other uses of the Fund’s resources.
(d) No later than July 1, 1998 and, not later than
March 1 of each year thereafter, the Secretary of the
Treasury shall submit a report to the appropriate commit-
tees on the status of timely publication of Letters of Intent
and Article IV consultation documents and the availability
of information referred to in (c).
SEC. 103. ADVISORY COMMISSION. (a) The President
shall establish an International Financial Institution Advi-
sory Commission (hereafter ‘‘Commission’’).
(b) The Commission shall include at least five former
United States Secretaries of the Treasury.
(c) Within 180 days, the Commission shall report to
the appropriate committees on the future role and respon-
sibilities, if any, of the International Monetary Fund and
the merit, costs and related implications of consolidation
of the organization, management, and activities of the
International Monetary Fund, the International Bank for
Reconstruction and Development and the World Trade
Organization.
SEC. 104. BRETTON WOODS CONFERENCE. Not later
than 180 days after the Commission reports to the appro-
priate committees, the President shall call for a conference
of representatives of the governments of the member coun-
tries of the International Monetary Fund, the Inter-
national Bank for Reconstruction and Development and
the World Trade Organization to consider the structure,
management and activities of the institutions, their pos-
sible merger and their capacity to contribute to exchange
rate stability and economic growth and to respond effec-
tively to financial crises.
SEC. 105. REPORTS. (a) Following the extension of
a stand-by agreement or other uses of the resources by
the International Monetary Fund, the Secretary of the
Treasury, in consultation with the U.S. Executive Director
of the Fund, shall submit a report to the appropriate com-
mittees providing the following information—
(1) the borrower’s rules and regulations dealing
with capitalization ratios, reserves, deposit insurance
system and initiatives to improve transparency of in-
formation on the financial institutions and banks
which may benefit from the use of the Fund’s re-
sources;
(2) the burden shared by private sector inves-
tors and creditors, including commercial banks in
the Group of Seven Nations, in the losses which
have prompted the use of the Fund’s resources;
(3) the Fund’s strategy, plan and timetable for
completing the borrower’s pay back of the Fund’s
resources including a date by which the borrower
will be free from all international institutional debt
obligation; and
(4) the status of efforts to upgrade the borrow-
er’s national standards to meet the Basle Commit-
tee’s Core Principles for Effective Banking Super-
vision.
(b) Following the extension of a stand-by agreement
or other use of the Fund’s resources, the Secretary of the
Treasury shall report to the appropriate committees in
conjunction with the annual submission of the President’s
budget, an account—
(1) of outcomes related to the requirements of
section 110; and
(2) of the direct and indirect institutional re-
cipients of such resources: Provided, That this ac-
count shall include the institutions or banks indi-
rectly supported by the Fund through resources
made available by the borrower’s Central Bank.
(c) Not later than 30 days after the enactment of
this Act, the Secretary shall submit a report to the appro-
priate committees of Congress providing the information
requested in paragraphs (a) and (b) for the countries of
South Korea, Indonesia, Thailand and the Philippines.
SEC. 106. CERTIFICATIONS. (a) The Secretary of the
Treasury shall certify to the appropriate committees that
the following conditions have been met—
(1) No International Monetary Fund resources
have resulted in support to the semiconductor, steel,
automobile, shipbuilding, or textile and apparel in-
dustries in any form;
(2) The Fund has not guaranteed nor under-
written the private loans of semiconductor, steel,
automobile, shipbuilding, or textile and apparel man-
ufacturers; and
(3) Officials from the Fund and the Depart-
ment of the Treasury have monitored the implemen-
tation of the provisions contained in stabilization
programs in effect after July 1, 1997, and all of the
conditions have either been met, or the recipient gov-
ernment has committed itself to fulfill all of these
conditions according to an explicit timetable for
completion; which timetable has been provided to
and approved by the Fund and the Department of
the Treasury.
(b) Such certifications shall be made 14 days prior
to the disbursement of any Fund resources to the bor-
rower.
(c) The Secretary of the Treasury shall instruct the
United States Executive Director of the International
Monetary Fund to use the voice and vote of the Executive
Director to oppose disbursement of further funds if such
certification is not given.