Selected Decisions and Selected Documents of the IMF, Thirty- Eighth Issue -- Special Charges on Overdue Financial Obligations to the Fund

Prepared by the Legal Department of the IMF
As updated as of February 29, 2016

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ARTICLE V, SECTIONS 8 AND 9
Charges and Remuneration

SPECIAL CHARGES ON OVERDUE FINANCIAL OBLIGATIONS TO THE FUND

I. Overdue Repurchases

  • 1. The Fund has reviewed the rates of charge to be levied under Article V, Section 8(c) on its holdings of a member’s currency that have not been repurchased in accordance with the requirements of the Articles or decisions of the Fund.

  • 2. Within three business days after (i) the due date for the repurchase by a member of the Fund’s holdings of its currency or (ii) the effective date of this decision, whichever is the later, the Fund shall consult with the member on the reduction of the Fund’s holdings of the member’s currency that should have been repurchased. The consultation shall take place by rapid means of communication.

  • 3. Unless the Fund’s holdings of the member’s currency are reduced within the period referred to in Section IV below by the amount that should have been repurchased, the rate of charge on the holdings that should have been repurchased shall be increased by a percentage equal to the excess, if any, of the rate of interest on the SDR over the rate of charge levied on the holdings under Rule I-6(4). For the purposes of this calculation, any adjustments in the rate of charge referred to in Rule I-6(4) that may be made to cover deferred income or for placement to the Special Contingent Account shall not be taken into consideration.

II. Overdue Charges in the General Resources Account

A special charge equal to the rate of interest on the SDR shall be paid by a member on the unpaid amount of charges owed by it under Article V, Section 8(a) and (b).

III. Overdue Interest and Repayments on Trust Fund Loans

The Fund shall levy a special charge on (i) the amount of overdue interest on Trust Fund loans, at a rate equal to one half of the sum of the rate of interest on Trust Fund loans and the rate of interest on the SDR, and (ii) the overdue amounts of repayments of Trust Fund loans, at a rate equal to one half of the sum of the rate of interest on Trust Fund loans and the rate of interest on the SDR, less one-half percent.

IV. Waiver of Special Charges

Special charges under Sections I, II, and III above shall be levied in respect of an overdue financial obligation as of the due date or the effective date of this decision, whichever is the later, unless the obligation is discharged within ten business days after the applicable date.

Effective May 1, 1992, special charges under Sections I and II above shall not be levied on overdue obligations of a member that is overdue in meeting any financial obligation to the Fund subject to special charges under Sections I and II above for six months or more.

Effective May 1, 1993, special charges under Section III above shall not be levied on overdue obligations of a member that is overdue for six months or more in meeting any financial obligation to the Fund subject to special charges under Section III above.

V. Notification and Payment of Special Charges

  • 1. Special charges levied under this decision shall be payable following the end of each of the Fund’s financial quarters and the member shall be notified promptly of any special charges due. The charges shall be payable on the second business day following the dispatch of the notification.

  • 2. Special charges in respect of overdue repurchases and charges in the General Resources Account shall be paid in SDRs to that Account. Special charges in respect of overdue repayments and interests on Trust Fund loans shall be paid in U.S. dollars to the Special Disbursement Account. Such payments may be made also in SDRs to a prescribed holder on behalf of the Special Disbursement Account, provided that use of SDRs is in accordance with Decision No. 8642-(87/101) S/TR, adopted July 9, 1987.

VI. Entry into Effect and Review

This Decision will enter into effect on February 1, 1986. It will be reviewed shortly after October 31, 1986 at the time of the mid-year review of the Fund’s income position for the financial year ending April 30, 1987, and thereafter annually in connection with the annual reviews of the Fund’s income position.

Decision No. 8165-(85/189) G/TR,

December 30, 1985, effective February 1, 1986,

as amended by Decision Nos. 8496-(87/3) G/TR, January 7, 1987,

8641-(87/101) G/S/TR, July 9, 1987,

8923-(88/110) G/TR, July 21, 1988,

10000-(92/58) G/TR, April 17, 1992,

10337-(93/49) G/TR, April 9, 1993,

10352-(93/49) G/TR, April 9, 1993,

10551-(94/1) G/TR, January 7, 1994, and

13001-(03/39) G/TR,

April 25, 2003

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