Decision ID: 001554

In February 2004 the 1971 Fund Executive Committee took note of a written statement read out by the Venezuelan delegation which included a number of criticisms of the 1971 Fund’s handling of the legal actions pending before the Venezuelan courts. The Director stated that the 1971 Fund regretted that it had not been able to make payments in full, which was a result of factors outside the Fund’s control, in particular the complexities of the legal proceedings, which had been brought in five different courts by various claimants, including the Republic of Venezuela. The Chairman stated that the declaration by the Venezuelan delegation was unprcedented in that in the past, whenever there had been strong disagreements regarding the Fund’s handling of particular issues, these had always been made known in advance of the sessions of the governing bodies so that they could be properly investigated by the Director and be given proper consideration by the governing bodies.A number of delegations expressed their disappointment and disquiet at the declaration by the Venezuelan delegation and stated that in spite of the allegations that had been made they continued to hold the highest regard for the honesty and integrity of the Director, the staff of the Secretariat and the Fund’s advisers and expressed their full confidence in them. It was stressed that the Direcor and the staff had always acted properly within the framework of the Conventions and in accordance with the policy decisions and instructions of the governing bodies which reflected the views of Member States. The Chairman made the point that it was important to realise that any criticism of the Fund should be seen as criticism of the Member States and not of the Director and the Secretariat, since it was the governing bodies of the Organisation that gave the Secretariat its instructions.The Chairman stated that the complexities of the Venezuelan legal process had given rise to international repercussions within the compensation regime by holding up progress in the payment of claims and added that he hoped that through the good offices of the Venezuelan delegation and the appropriate Venezuelan authorities steps could be taken to break the impasse.

Date: 01.02.2004
Category: Application of the Conventions
Subject: Criticism of the Funds