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American University Washington College of Law Digital Commons @ American University Washington College of Law IFC E&S Performance Standards IFC E&S Standards 11-1998 November, 1998, IFC, Projects on International Waterways, OP 7.50 IFC Follow this and additional works at: https://digitalcommons.wcl.american.edu/ifc_e_and_s_performance_standards  Part of the Environmental Law Commons, International Law Commons, Law and Society Commons, Legal Ethics and Professional Responsibility Commons, and the Organizations Law Commons The International Finance Corporation Operational Policies Projects on International Waterways OP 7.50 November 1998 Page 1 of3 Note: This policy applies to projects financed by the International Finance Corporation (JFC). In case of doubt, any determinarion of what is acceptable to IFC under this policy is made by the Vice President, Investment Operations in consultation with the Vice President with corporate responsibility for environmental issues, the Technical and Environment, and Legal Departments. Questions should be addressed to the Associate Director, IFC's Environment Division. Applicability of Policy I . IFC's1 operational policy covers the following types of international waterways: a) any river, canal, lake, or simi lar body of water that forms a boundary between, or any river or body of surface water that flows through, two or more states, whether JFC members or not; b) any tributary or other body of surface water that is a component of any waterway described in (a) above; and c) any bay, gulf, strait, or channel bounded by two or more states or, if within one state, recognized as a necessary channel of communication between the open sea and other states--and any river flowing into such waters. 2. The policy applies to the fo llowing types of projects: a) hydroelectric, irrigation, flood control , navigation, drainage, water and sewerage, industrial, and s imilar projects that involve the use or potential pollution of international waterways as described in para. l above; and b) detailed design and engineering studies of projects under para. 2(a) above as part of an lFC investment or of non-lending services. Agreements/ Arrangemcn ts 3. Projects on internationa l waterways may affect relations between IFC and its members and between states (whether members of IFC or not). IFC recognizes that the cooperation and goodwill of riparians is essential for the effic ient utilization and protection of the waterway. Therefore, it attaches great importance to riparians' making appropriate agreements or arrangements for these purposes for the entire waterway or any part thereof. In cases where differences remain unresolved between the beneficiary state and the other riparians, prior to financing the project IFC normally would urge the beneficiary state to offer to negotiate in good faith with the other riparians to reach appropriate agreements or arrangements. Notification 4. IFC and the project sponsor ensure that the international aspects of a project on an international waterway are dealt with at the earliest poss ible opportunity. If such a project is proposed, the project sponsor or IFC (with the project sponsor' s consent) requests the benefic iary state, if the beneficiary state has not already done so, formally to noti fy the other riparians of the proposed project and its Project Details.2 If the beneficia1y state ind icates to the project sponsor or IFC that it does not 1 Tite lntemaiional Finance Corporaiion (IFC) is the World Bank Group entity with a mandale to invest in private seclor projects in developing member countries. It lends directly to and makes equity investments in private companies without guarantees from governments and attracts other sources of funds for these projects. I FC also provides advisory services and technical assistance to governments and businesses. 2 The Project Details provide sufficient technical specifications. information and other data to enable the other riparians to detennine as accurately as possible whether the proposed projeci has potential for causing appreciable harm through water deprivation or pollution or otherw ise. IFC s taff should be These policies were preparedfor use by lntemotional Finance CoqJoration (IFC) staff and are not necessarily a complete treatment of the subject. Additional copies are available to IFC staff in the b!formation Resources Cemer (Room L- 124). and to the public through the World Wide Web ell hitp: 1/v.,ww. i fc .or~/cnviro The International Finance Corporation Operational Policies OP 7.50 November 1998 Page 2 of3 wish to give notification, normally the project sponsor or IFC (with the project sponsor's consent) does so.3 If the beneficiary state also objects to the project sponsor's or IFC's doing so, or if the required noti fication does not take place because the project sponsor does not give its consent, IFC discontinues processing of the project. The members of IFC's Board of Directors concerned are informed of these developments and any further steps taken. 5. IFC ascertains whether the riparians have entered into agreements or arrangements or have established any institutional framework for the waterway concerned. In the l11 tter case, IFC ascertains the scope of the institution's activities and functions and the status of its involvement in the proposed project, bearing in mind the possible need for notifying the institution. 6. Following notification, if the other riparians raise objections to the proposed project, IFC in appropriate cases may appoint one or more independent experts4 to examine the issues Should IFC decide to proceed with the project despite the objections of the other riparians, IFC informs them of its decision. Exceptions to Notifica tion Requirement 7. The following exceptions are allowed to the IFC's requirement that the other riparian states be notified of the proposed project: a) For any ongoing schemes, projects involving additions or alterations that require rehabilitation, construct ion, or other changes that in the judgment of IFC i) will not adversely change the quali ty or quant ity of water flows to the other riparians; and ii) will not be adversely affected by the other riparians' possible water use. This exception applies only to minor additions or alterations to the ongoing scheme; it does not cover works and activities that would exceed the original scheme, change its nature, or so alter or expand its scope and extent as to make it appear a new or different scheme. In case of doubt regarding the ex tent to which a project meets the criteria of this exception, the members of IFC's Board of Directors representing the riparians concerned are informed and given at least two months to reply. Even if projects meet the criteria of this exception, IFC tries to secure compliance with the requirements of any agreement or arrangement between the riparians. b) Water resource surveys and feasibility studies on or involving international waterways. However, the project sponsor proposing such activities includes in the terms of reference for the activities an examination of any potential riparian issues. c) Any project that relates to a tributary of an international waterway where the tributary runs exclusively in one state and the state is the lowest downstream riparian. unless there is concern that the project could cause appreciable harn1 to other states. satisfied that the Project Details are adequate for making such a dctcnninntion. If not available at the time of notification, Project Detai ls arc made available to the other riparians as soon as possible afte r the notifocmion. 3 For the purposes of this notification. IFC may request the assistance of the relevant members of IFC"s Board of Directors. • If independent expen opinion is needed before funher processing of the project. the Vice President. Investment Operations. initiates the process. Tioe Vice President. Investment Operations. in consultation with the Vice President and General Counsel. select one or more independent expens and develop necessary tem1s of reference. The World Bank may be requested to assist in the process of identifying ex pen s. The ex pen s selected may not be nationals of any of the riparians of the waterways in question. and also may not have any other confli cts of interest in the maner. Titc experts are provided with the background infomtation and assistance needed to complete their work effi ciently. The cxpens' tenns of reference require that they examine the Project Details. If they deem it necessary to verify the Project Details or take any related action. IFC makes its best cffon to assist. The ex pens meet on an ad hoc basis until they submit their report to the Vice President. Investment Operntions. The expens have no decision-making role in the project's processing. Their technical opinion is submitted for IFC's purposes only. and does not in any way detcnnine the rights and obligations of the riparians. Their conclusions are reviewed by the Vice President, Investment Operations. in consultation with the Vice President and General Counsel. These policies were prepared for u.1·e by lmemational Finance Cot]JOration (IFC) staff and are not necessarily a complete treatmelll aft he subject. Additional copies are available 10 IFC staff in the Information Resource.< Cemer (Room L-124). and to the public through the World Wide Web at htt [l:IIW\\"w.ifc.grg/cnviro The International Finance Corporation Operational Policies Presentation of Loans to the 1embers of JFC 's Board of Directors OP 7.50 November 1998 Page 3 of3 8. For every project on an international waterway, the IFC Board Report wi ll deal with the international aspects of the project, and state that IFC staff have considered these aspects and are satisfied that a) the issues involved are covered by an appropriate agreement or arrangement between the beneficiary state and the other riparians; or b) the other riparians have giv~n a positive response to the beneficiary state or IFC, in the form of consent, no objection, support to the project, or confirmation that the project will not harm their interests; or c) in all other cases, in the assessment of IFC staff. the project will not cause appreciable harm to the other riparians, and will not be appreciably harmed by the other riparians' possible water use. The Board Report also contains in an annex the salient features of any objection and, where applicable, the report and conclusions of the independent experts. Maps 9. Documentation for a project on an international waterway includes a map that clearly indicates the waterway and the location of the project's components. This requirement appl ies to the Envi ronmental Review Summary (ERS) and the Board Report as well as any internal memoranda that deal with the riparian issues associated with the project. Maps are prepared and cleared in accordance with the World Bank 's Administrative Manual Statement 7.10, Cartographic Services, and its annexes. I 0. However, the inclusion of maps in the cited documents, except internal memoranda, is subject to any general instmction or decision of the Vice President, Investment Operations, taken in consultation wi th the Vice President and General Counsel, to omit maps of the beneficiary state in entirety or in part. These p olicies were prepared for use by lmemational Finance Cmporation (IFC) sta.ff and are not necessarily a compleTe treaTm enT of lite subjecT. Additional copies are rll'ailable to IFC staff in the il!formation Resources Center (Roam L-124). and to the public through the World Wide Web at http://www.ifc,orgicnviro 

November, 1998, IFC, Projects on International Waterways, OP 7.50

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November, 1998, IFC, Projects on International Waterways, OP 7.50

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