INTERGOVERNMENTAL NEGOTIATING COMMITTEE FOR AN
  INTERNATIONAL LEGALLY BINDING INSTRUMENT FOR
  IMPLEMENTING INTERNATIONAL ACTION ON
  CERTAIN PERSISTENT ORGANIC POLLUTANTS

Second session
Nairobi, 25-29 January 1999

Existing mechanisms for providing technical and financial

assistance to developing countries and countries with

economies in transition for environmental projects

Note by the Secretariat

1. At its first session, the Intergovernmental Negotiating Committee asked the Secretariat to prepare a description of the content and operations of existing multilateral mechanisms for providing technical and financial assistance (UNEP/POPS/INC.1/7, para. 62(c)).

2. In response to this request, the Secretariat prepared the attached report that discusses existing mechanisms for providing technical and financial assistance to developing countries and countries with economies in transition for environmental projects. Without prejudice to any approaches that the Committee may wish to consider, the report includes information about mechanisms in operation so that experience can be considered in developing an instrument on persistent organic pollutants.

3. An overview of the types of existing technical and financial assistance mechanisms currently used in multilateral environmental agreements is presented in UNEP/POPS/INC.2/4.

5. Annexes

At the first session of the Intergovernmental Negotiating Committee (INC) for an International Legally Binding Instrument for Implementing International Action on Certain Persistent Organic Pollutants, delegates requested that the Secretariat prepare several papers for use at the second INC. One of these papers was to be a description and summary of existing mechanisms for providing technical and financial assistance for environmental projects to developing countries and countries with economies in transition (CEITs).

The purpose of this report is to serve as a tool to initiate discussions about the form and function of a POPs technical and financial assistance mechanism. The report aims to provide delegates to the second and subsequent INCs with detailed information about technical and financial assistance mechanisms currently in operation so that their experiences can be considered in the development of the international POPs treaty. It does not discuss emerging mechanisms, such as those currently being considered in other fora. This report is divided into five sections:

Section 2 describes a number of different models of technical and financial assistance mechanisms that have been employed by previously negotiated environmental agreements. Models are first divided into two general types: 1) independent mechanisms specific to a single treaty or agreement; and 2) multipurpose mechanisms not linked to any single treaty or agreement. Each model is then further broken down to account for its mode of contributions, i.e., mandatory or voluntary.

Section 3 presents an overview of several environmental agreements that contain technical and financial assistance mechanisms to provide support for developing countries and CEITs. In total, six environmental agreements are profiled:

These agreements were selected due to the fact that they have taken specific actions to define, within their legal framework, a method and/or mechanism to be used in providing technical and financial assistance to developing countries and CEITs.

After the overview of each treaty or agreement, a fact sheet is presented describing the development and operation of the technical and financial assistance mechanism associated with that particular treaty or agreement. Within each fact sheet, a wide variety of information is presented, including:

Section 4 provides brief overviews of a few examples of voluntary technical and financial assistance mechanisms associated with non-binding international agreements involving the environment.

For the purposes of comparison, each of the technical and financial assistance mechanisms profiled in this report can be placed into one of three general types of mechanisms. These types are:

This section will describe in brief the unique attributes of each of these types of mechanisms.

The first type of mechanism that may be established for providing technical and financial assistance under an environmental treaty or agreement is a mechanism that is independent. For the purposes of this paper, a mechanism is considered to be independent when it has been established solely for the purposes of providing assistance under a single treaty or agreement. That is, the mechanism was not in existence prior to the signing of the particular treaty or agreement it serves, and it would not exist in the absence of that treaty or agreement. An example is the Multilateral Fund of the Montreal Protocol on Substances that Deplete the Ozone Layer.

The use of an independent technical and financial assistance mechanism provides both advantages and disadvantages to the Parties to a treaty or agreement. These, however, will differ based on the substance of the treaty or agreement. In general, independent mechanisms have the following set of attributes:

The second type of mechanism often used for the provision of technical and financial assistance under environmental treaties is a multipurpose mechanism. In this case, while the multipurpose mechanism serves all of the functions of an independent mechanism, it exists to provide assistance for projects implemented under more than one treaty, or in some cases, outside the scope of any treaty. A multipurpose mechanism was in existence prior to the completion of the treaty; and with which the Parties to the treaty have negotiated an arrangement for administering their technical and financial assistance needs. In this case, in the absence of any one treaty that uses this mechanism as a means of providing technical and financial assistance, the mechanism would still function. An example is the Global Environment Facility.

Multipurpose technical and financial assistance mechanisms have attributes that generally resemble those of independent mechanisms. However, they may also have a number of distinctive features and attributes that differ from independent mechanisms, including:

A third type of mechanism that may be considered for the provision of technical and financial assistance under environmental treaties is a mechanism that facilitates and coordinates available donor funding. This type of mechanism does not provide any funding or assistance on its own. Instead, it provides a mechanism for assisting in the identification of outside sources of funds and assistance, as well as for assisting countries in applying for these funds and assistance. An example is the Global Mechanism under the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification.

Mechanisms of this type have a number of unique attributes and characteristics that set them apart from the independent or multipurpose mechanisms. Probably most important is that they provide a very low-cost form of assistance in that they do not actually solicit or distribute funds or in-kind contributions. As a result, the only funding required is for the operation of the Secretariat or body that will carry out the activities of the mechanism. However, while they can provide such low-cost assistance by simply identifying outside sources of assistance, there is no guarantee that funds or technical assistance will ultimately be made available by these outside sources. As a result, it is possible that the lack of a funding mechanism specifically dedicated to the treaty or agreement may result in a lower level of technical and financial assistance being available to countries under that agreement.

In addition, technical and financial assistance for activities implemented to comply with the requirements of an environmental treaty or agreement (including those profiled in Section 3 of this report) may also be available from sources other than the mechanisms established by that particular treaty or agreement. Most notable among the external sources of funding for such activities are the bilateral assistance agencies and the multilateral development banks (MDBs). MDBs active in the environmental arena include:

Many MDBs have active programs to support environmental projects and, as such, may serve as another source of funds to supplement those available through the technical and financial assistance mechanisms associated with the individual agreements. Requests for this funding are typically made through the MDB directly, and assistance may come in the form of a grant or loan.

Below is a summary table of technical and financial assistance mechanisms associated with six multilateral environmental agreements.

In 1985, under the auspices of the United Nations Environment Programme (UNEP), the governments of the world drafted the Vienna Convention on the Protection of the Ozone Layer. The main thrust of the Vienna Convention was the encouragement of co-operation among countries in conducting scientific research to improve the understanding of atmospheric processes. The Vienna Convention set an important precedent; for the first time, nations agreed in principle to undertake efforts to address a global environmental problem before its effects were felt, or even scientifically proven.

Efforts initiated under the Vienna Convention were solidified in September 1987, when the Montreal Protocol on Substances that Deplete the Ozone Layer was agreed upon at the Headquarters of the International Civil Aviation Organisation in Montreal, Canada. The Montreal Protocol aims to reduce and eventually eliminate the production and consumption of human-made ozone-depleting substances (ODS) around the world. The Protocol came into force on 1 January 1989 and includes specific ozone protective measures to be taken by signatory Parties. The original text of the Protocol has been amended and/or adjusted three times since 1989 -- in London in 1990, in Copenhagen in 1992, and in Montreal in 1997.

3.1.1.1 Requirements and Control Measures

Signatory Parties of the Montreal Protocol must meet a number of requirements relating to the evaluation of their domestic production and consumption of ODS. In addition, they must commit to achieving specific reductions in this production and consumption within a specified timeframe (i.e., phase-out schedule). At inception, the Protocol clearly defined control measures that signatory countries were required to implement. These control measures limited production and consumption of five chlorofluorocarbons (CFCs) and three halons. Since then, the Protocol has been amended and adjusted to include controls on ten additional CFCs, carbon tetrachloride (CTC), 1,1,1-trichloroethane (methyl chloroform or MCF), 34 hydrochlorofluorocarbons (HCFCs), 34 hydrobromofluorocarbons (HBFCs), and methyl bromide.

Compliance with the control measures set by the Protocol is obligatory for signatories. However, the manner in which countries meet the specified ODS control measures is entirely determined by the individual country. Furthermore, countries may choose to voluntarily undertake the required actions within an accelerated timeframe.

The Montreal Protocol contains several clauses covering the special circumstances of developing countries to assure that the control measures of the Protocol do not hinder the economic development of such countries and to increase the ability of these countries to comply with the measures. Article 5 of the Protocol states that any Party that is a developing country and whose annual level of consumption does not exceed 0.3 kilograms per capita of Annex A controlled substances and 0.2 kilograms per capita of Annex B controlled substances shall, in order to meet basic domestic needs, be entitled to a 10-year grace period for compliance with the control measures set out by the Protocol. Countries that fall into this category are typically referred to as Article 5 countries. In addition to the grace period, Article 5 countries are entitled to financial and technical assistance in order to facilitate their compliance with control measures (see Section 3.1.2 below).

Originally, countries with economies in transition (CEIT) that did not meet Article 5 requirements were not given any special consideration by the Montreal Protocol. However, it became clear with the break-up of the Former Soviet Union that CEITs would be in need of assistance. To address this issue, an Ad Hoc Working Group on CEIT Aspects was set up. CEIT cases are reviewed individually and recommendations are made for appropriate assistance. Generally, the Working Group makes recommendations for international assistance to CEITs, particularly from the ozone layer depletion focal area of the Global Environment Facility (GEF), in order to provide funding for projects to implement country programmes for phasing out ODS.

In order to help finance the incremental costs of meeting the requirements of the Protocol in developing countries and to promote an accelerated phaseout of ODS within these countries, the Montreal Protocol as originally drafted provided for the creation of a financial mechanism. The 1990 London Amendments to the Protocol established this mechanism, the cornerstone of which is an independent Multilateral Fund, which is supplemented by other multilateral, regional, and bilateral co-operation. The Multilateral Fund has its own management body (the Executive Committee) and Secretariat and functions to:

Article 10 of the Montreal Protocol as adopted in 1987 set forth that the Parties shall establish a mechanism for the purpose of providing financial and technical co-operation, including the transfer of technologies, to Article 5 countries to enable their compliance with the control measures of the Protocol. At the First Meeting of the Parties (May 1989, Helsinki), the Parties recognised the urgency to establish international and other financial mechanisms, considered the essential components of the mechanisms, and set up an Open-Ended Working Group (OEWG) to develop modalities for such mechanisms. The OEWG was mandated to report their findings at the Second Meeting of the Parties.

The Fourth Meeting of the Parties (November 1992, Copenhagen) decided to establish the official Financial Mechanism, including the Multilateral Fund provided for in Article 10 of the Protocol as amended at the Second Meeting of the Parties. The agreement included provisions to make the Multilateral Fund operational from 1 January 1993 and to transfer to it any resources remaining from the Interim Multilateral Fund on that date.

The text of Article 10 from the Montreal Protocol as adopted in 1987 is presented in Annex 1, along with relevant decisions made by the Conference of the Parties (COP), which establishes the current structure of the Multilateral Fund.

The day-to-day operations of the Montreal Protocol Multilateral Fund are the responsibility of the Multilateral Fund Secretariat, which has its offices in Montreal. Decisions concerning approval of Fund disbursements are handled jointly by the Secretariat and a 14-member Executive Committee. These disbursements are typically made through one of four implementing agencies (the United Nations Development Programme (UNDP), the United Nations Environment Programme (UNEP), the United Nations Industrial Development Organisation (UNIDO), and the International Bank for Reconstruction and Development (World Bank)).

Additional details on the procedures associated with implementation and administration of the Multilateral Fund are presented in the fact sheet beginning on the following page.

The Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal is the response of the international community to the problems associated with the annual world-wide production of over 400 million tonnes of wastes determined to be hazardous to people or the environment by virtue of being toxic, poisonous, explosive, corrosive, flammable, or infectious. The Basel Convention was adopted in March 1989 to deal with the growing traffic in hazardous wastes from industrialised countries to developing and East European countries. The Convention entered into force on 5 May 1992.

The Basel Convention is an overarching multilateral environmental agreement on international trade in hazardous wastes. Other international agreements or principles that deal with this issue include the Bamako Convention, the Declaration of the United Nations Conference on the Human Environment (Stockholm, 1972), and the Cairo Guidelines and Principles for the Environmentally Sound Management of Hazardous Wastes adopted by the United Nations Environment Programme (UNEP). The Secretariat of the Basel Convention already actively co-operates with the Secretariat of Interpol and the enforcement section of the World Customs Organisation, and plans to co-operate in future work under the Rotterdam Convention on Prior Informed Consent Procedure for Certain Hazardous Chemicals in International Trade and under the Legally Binding Instrument for Implementing International Action on Certain Persistent Organic Pollutants.

The Convention has grown from 30 Contracting Parties in 1992 to 121 Contracting Parties as of November 1998 (120 State Parties and the European Economic Community (EEC)).

The Basel Convention strictly regulates the transboundary movements of hazardous wastes and provides obligations to its Parties to ensure that such wastes are managed and disposed of in an environmentally sound manner. In order to achieve these principles, the Convention aims, through its Secretariat, to control the transboundary movement of hazardous wastes, monitor and prevent illegal traffic, provide assistance for the environmentally sound management of hazardous wastes, promote co-operation between Parties in this field, and develop Technical Guidelines for the management of hazardous wastes. The main principles of the Basel Convention are:

This affirmation led to the adoption of the 1995 Ban Amendment to the Convention by the Conference of the Parties (COP) which prohibits the export of hazardous wastes for final disposal from OECD to non-OECD signatories. The COP also adopted banning the import or export of hazardous wastes for recovery operations (e.g., recycling). Thus far, ten State Parties and the EEC have ratified the 1995 Ban Amendment. To enter into force, the Ban Amendment must be ratified by three-fourths of the Parties that have accepted it.

The Basel Convention gives special consideration to developing countries in the form of technical and financial assistance (see Section 3.2.2 below).

The Basel Convention has a focus on technical assistance, development of technical guidelines for the environmentally sound management of waste streams and disposal operations, and assistance for developing countries in the development of legal and technical capacities. The Conference of the Parties established a Technical Co-operation Trust Fund to support developing countries and other countries in need of technical assistance in the implementation of the Convention. Technical assistance activities include:

Another mechanism of importance under the Convention is the facilitation by the Secretariat of bilateral assistance activities among Parties. Such activities have been carried out under the framework of the Convention in accordance with Article 10, International Co-operation and, where appropriate, Article 9, Illegal Traffic.

Parties are also considering the use of a revolving fund in relation to the preparation of a protocol on liability and compensation.

Article 14 of the Basel Convention requires co-operation in the establishment of regional or subregional centres for training and technology transfer regarding the management of hazardous wastes and the minimisation of their generation, based on the specific needs of different regions and subregions. This Article also stipulates that Parties shall decide on appropriate funding mechanisms of a voluntary nature for the establishment of such regional or subregional centres.

At the First Meeting of the COP (Uruguay, December 1992), the United Nations Environment Programme (UNEP) was selected by the Parties to carry out the functions of the Basel Convention Secretariat (to be located in Geneva). At this time, the Parties also invited the Secretary-General of the United Nations to establish a Technical Co-operation Trust Fund to support developing countries and other countries in need of technical assistance in the implementation of the Basel Convention and to manage contributions to the Fund. Annex II of this decision states that the Technical Trust Fund shall be established for an initial period of two years, beginning 1 January 1993 and ending 31 December 1994. It further states that the appropriation of the Technical Trust Fund for this period shall be financed from voluntary contributions made by the Parties and the non-Parties to the Convention.

Also at the First Meeting, the COP decided that the Open-ended Ad Hoc Committee (OAHC) for the implementation of the Convention should identify the specific needs of different regions and subregions for training and technology transfer. It was further requested that the OAHC determine the modalities for the establishment and functioning of such centres as well as for the establishment of appropriate funding mechanisms of a voluntary nature for the establishment of such centres.

The Second Meeting of the COP (Geneva, March 1994) extended the Technology Trust Fund as adopted by the First Meeting for the period 1995 to 1998.

At its Fourth Meeting (Malaysia, October 1997), the COP expressed concern over the delays in payments of the agreed upon voluntary contributions by Parties and non-Parties. The COP stated that voluntary contributions are essential to the effective implementation of the Convention and that it is anticipated that additional voluntary contributions will be received. At this time, the Technology Trust Fund as adopted by the First Meeting was further extended to the end of 2004.

The text of Article 14 from the Basel Convention as adopted in 1989 is presented in Annex 2, along with relevant decisions made by the COP at the First Meeting and the text of Annex II, which establishes the current structure of the Technology Trust Fund.

3.2.2.2 Operation of the Mechanism

The Technical Co-operation Trust Fund is administered by UNEP, in accordance with the financial regulations and rules of the United Nations, the general procedures governing the operations of the Environment Fund of the United Nations Environment Programme, and the terms of reference for the administration of this Trust Fund (details are provided in Annex 2). The Secretariat provides assistance within the limits of its existing financial resources, including: ad hoc advice provided to Parties, non-Parties and others; and responses to ad hoc requests for information and documentation related to the Basel Convention.

Additional details on the procedures associated with implementation and administration of the Technical Co-operation Trust Fund are presented in the fact sheet beginning on the following page.

At any time after two years from the date on which the Convention entered into force for a Contracting Party, that Contracting Party may withdraw from the Convention by giving written notification.

Article 20 of the Convention states that developed country Parties shall provide new and additional financial resources to enable developing country Parties to meet the incremental costs of implementing measures which fulfil the objectives of the Convention. Article 21 provides for a mechanism to deliver financial assistance.

The Subsidiary Body for Scientific, Technical, and Technological Advice (SBSTTA), which was set up under the Convention, provides advice relating to the implementation of the Convention. It is a multidisciplinary body comprising government representatives competent in all the relevant fields of expertise. The body has met annually since 1995.

An important mechanism for technical assistance is the Clearing-House Mechanism (CHM), which promotes technical and scientific co-operation and facilitates access to and the exchange of information related to the Convention. The Clearing-House Mechanism includes an on-line database of technical advice.

Article 21 of the Convention on Biological Diversity provides for a mechanism for the provision of financial resources to developing country Parties for meeting obligations under the Convention on a grant or concessional basis. Article 39 of the Convention indicates that the Global Environment Facility (GEF) provide the institutional structure for this financial mechanism on an interim basis, for the period between the entry into force of the Convention and the first meeting of the Conference of the Parties. Article 25 of the Convention establishes the Subsidiary Body for Scientific, Technical, and Technological Advice (SBSTTA). At its first meeting, the Conference of Parties to the Convention decided that the GEF is to continue to serve as the institutional structure for the operation of the financial mechanism on an interim basis. The complete language from the Convention pertaining to the establishment of this mechanism can be found in Annex 3.

Additional details related to the operation of GEF are provided in the fact sheet beginning on the following page.

The United Nations Framework Convention on Climate Change (UNFCCC) was preceded by a number of Conferences and Meetings organised to address climate change-related issues. The Vienna Convention for the Protection of the Ozone Layer, 1985, the Montreal Protocol on Substances that Deplete the Ozone Layer, 1987, and the Ministerial Declaration of the Second World Climate Conference adopted on November 7, 1990 all brought concern about climate change to the forefront. To address this concern, the United Nations Conference on Environment and Development decided on resolutions for the protection of global climate for present and future generations, provisions on the possible adverse effects of sea-level rise on islands and coastal areas, and provisions on the implementation of the Plan of Action to Combat Desertification. A result of UNCED was the UNFCCC, a treaty addressing the need to reduce GHG emissions not covered by the Montreal Protocol on Substances that Deplete the Ozone Layer.

Initially, 35 countries and the European Economic Community signed the United Nations Framework Convention on Climate Change. The Convention remained open for signing between June 1992 through June 1993, and by the end of that period there were 166 signatories. The Convention entered into force on March 21, 1994 and, as of October 7, 1998, the UNFCCC had received 176 instruments of ratification.

The Parties to the UNFCCC agreed to undertake a number of measures related to the reduction of greenhouse gas emissions, including action to:

In 1997, the Kyoto Protocol to the UNFCCC was at its third COP. The Kyoto Protocol set specific GHG emission reduction goals for the signatory countries and as of September of 1998, 57 countries had signed the Kyoto Protocol. The Protocol states that each Party shall reduce their carbon dioxide equivalent emissions of the six stated greenhouse gases, Carbon dioxide (CO₂), Methane (CH₄), Nitrous oxide (N₂O), Hydrofluorocarbons (HFCs), Perfluorocarbons (PFCs), Sulphur hexafluoride (SF₆)) to meet their assigned levels. This shall be accomplished with the goal of having the overall emissions of these gases at least 5 percent below 1990 levels between 2008 and 2012. It is also noted that clear progress towards this goal should be accomplished by 2005.

The Conference of the Parties is required to review, assess, and oversee the implementation of the commitments of the Parties.

Under the rules regulating the financial mechanism of the UNFCCC, only developing countries are eligible to receive funding. This funding is to be for enabling, mitigation or adaptation activities. By definition under Article 11 of the Convention, technical assistance through transfer of technology is also included in the financial mechanism.

Article 11 of the UNFCCC, states that the operation of a financial mechanism will be entrusted to an existing international entity. This is further explained in Article 21, Interim Arrangements, where it is stated that the GEF will serve as the financial mechanism on an interim basis. The complete language establishing the technical and financial assistance mechanism can be found in Annex 4.

Article 11 requires a review of the mechanism after four years to determine the appropriateness of the use of the GEF and if the mechanism should be changed. In November of 1998, the fourth session of the COP agreed that the GEF should be an operating entity of the Convention.

Additional details related to the operation of GEF are provided in the fact sheet beginning on the following page.

Fact Sheet: United Nations Framework Convention on Climate Change

Desertification is land degradation in arid, semi-arid and dry sub-humid areas resulting from various factors including climatic variations and human activities. The international community has long recognised that desertification is a major economic, social, and environmental problem of concern to many countries in all regions of the world. In 1977, the United Nations Conference on Desertification (UNCOD) adopted a Plan of Action to Combat Desertification (PACD). Despite this and other efforts, the United Nations Environment Programme (UNEP) concluded in 1991 that the problem of land degradation in arid, semi-arid, and dry sub-humid areas had intensified, although there were "local examples of success."

As a result, the question of how to address desertification was still a major concern for the 1992 United Nations Conference on Environment and Development (UNCED), which was held at the Rio Earth Summit. The Conference supported a new, integrated approach to the problem emphasising action to promote sustainable development at the community level. It also called on the United Nations General Assembly to establish an Intergovernmental Negotiating Committee (INC) to prepare by June 1994 a Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa. In December 1992, the General Assembly adopted Resolution 47/188.

Working on a tight schedule, the Committee completed its negotiations in five sessions. The Convention was adopted in Paris on 17 June 1994 and opened for signature there on 14-15 October 1994. Over 100 countries have signed the Convention so far, and it entered into force on 26 December 1996, 90 days after the 50th ratification was received. The Conference of the Parties (COP), which will be the Convention's governing body, held its first meeting in October 1997 in Rome.

Among other responsibilities, all parties of the Convention undertake to:

There are additional responsibilities specific to affected countries and developed countries. Affected country Parties must:

Developed country Parties must:

At any time after three years from the date on which the Convention entered into force for a Party, that Party may withdraw from the Convention by giving written notification to the Secretary-General of the United Nations. Withdrawal shall take effect one year from the date of receipt of notification.

Developed countries are required to provide financial and technical assistance to developing countries that are combating desertification.

In order to increase the effectiveness and efficiency of existing financial mechanisms, the Global Mechanism was established to promote actions leading to the mobilisation and channelling of substantial financial resources to combat desertification.

Article 21 of the Convention establishes the Global Mechanism. During the first session of the Conference of Parties in October 1997, the United Nations International Fund for Agricultural Development (IFAD) was designated to house the Global Mechanism. The complete language from the Convention and subsequent COP meetings relating to the establishment and operation of the Global Mechanism is presented in Annex 5.

The Global Mechanism co-ordinates and facilitates partnerships between project developers and potential sources of funding, including programs and bodies of the United Nations, particularly FAO (Food and Agriculture Organisation), GEF (Global Environment Facility), UNEP (United Nations Environment Programme), WFP (World Food Programme), regional development banks, and regional and subregional organisations, as well as interested NGOs and the private sector.

Additional details related to the operation of the Global Mechanism are provided in the fact sheet beginning on the following page.

Fact Sheet: The United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa

Toxic pesticides and other chemicals poison and kill thousands of people each year. When released into the environment, many of these substances may also poison water resources, animals, and plantlife. Many are persistent organic pollutants (POPs), which are highly toxic and can persist in the environment for long periods of time, can bioaccumulate, are mobile in the environment, and are able to travel large distances from where they were released. Virtually every developing country has accumulated undesired and out-of-date stockpiles of pesticides and toxic chemicals.

In 1989, these two voluntary instruments were amended by their respective governing bodies to include the Prior Informed Consent procedure to help regulate imports by participating countries of unwanted chemicals that have been banned or severely restricted. In November 1994, the FAO Council agreed that the FAO Secretariat should proceed with the preparation of a draft PIC Convention as part of the current FAO/UNEP programme on PIC, and in cooperation with other international and non-governmental organizations concerned. In May 1995, the 18th session of the Governing Council of UNEP authorized the Executive Director to prepare and convene, together with FAO, and in consultation with Governments and other relevant international organizations, an intergovernmental negotiating committee (INC) with a mandate to prepare an international legally binding instrument for the application of the PIC procedure for certain hazardous chemicals in international trade. In October 1996, the FAO Council, at its 11th session, expressed satisfaction with the progress made on the PIC negotiations and concluded that the then present mandate of the INC would continue. The Governing Council of UNEP at its 19th session in January 1997 confirmed the mandate of the INC as given by the 18th Governing Council and invited the INC to aim to conclude the negotiations in 1997.

The Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals in International Commerce was adopted by the Conference of Plenipotentiaries on 10 September 1998.  In agreeing to this legally binding PIC procedure, countries aim to improve the protection of human health and the environment from the possible detrimental effects of certain chemicals. Pesticides and industrial and consumer chemicals already banned or severely restricted for health or environmental reasons by the participating countries can be included in the procedure. In addition, when the conditions of use of acutely toxic pesticide formulations pose a hazard in developing countries, those chemicals may also be included. The inclusion of chemicals in the PIC procedure is decided by the Conference of the Parties. The Convention initially included 27 chemicals that were carried forward from the previously existing voluntary PIC procedure. Many more will likely be added as the provisions of the Convention are implemented. The PIC procedure excludes certain specific groups of chemicals, such as pharmaceuticals, radioactive materials and food additives. Small quantities of chemicals used for research purposes and some other small volume uses are also excluded from the procedure.

The Convention was opened for signature on September 11, 1998 and was signed by 62 governments during the Conference.  The Final Act of the Conference was signed by 80 governments. The Convention is now open for signature at United Nations Headquarters in New York until 10 September 1999 and will enter into force after being ratified by 50 governments. Until such time governments have agreed to implement the Convention on a voluntary basis.

The Convention contains provisions for the exchange of information among Parties about potentially hazardous chemicals that may be exported and imported and provides for a national decision-making process regarding import and export compliance with these decisions. The provisions regarding information exchange include requirements:

Additionally, decisions taken by the importing Party must be trade neutral. This means that if a Party decides to not accept imports of a specific chemical, it must also stop domestic production of the chemical for in-country use and cease any imports of the chemical from non-Parties to the Convention.

According to Article 17, procedures and mechanisms to determine non-compliance with this Convention as well as provisions for treatment of Parties found in non-compliance will be decided and approved as soon as possible by the Conference of the Parties.

The Convention in Article 16 and the resolution on interim arrangements call upon governments that are able to help developing countries and countries with economies in transition (CEITs) to participate fully and effectively in the Convention by providing the necessary financial and technical resources.

In the Resolution on Interim Arrangements under Part III, Number 14, the Conference calls for voluntary contributions to the trust fund established by UNEP from States and regional economic integration organisations. The funds are to help support the operation of the Conference of the Parties until the next fiscal year, as well as to ensure the full and effective participation of developing countries and CEITs in the work of the Committee. Under Part III, Number 15, States and regional economic integration organisations with more advanced chemical regulating programs are also asked to provide technical assistance, including training, to other States and organisations that do not have the advanced infrastructure and programs to manage chemicals.

The Environmental Action Programme (EAP) for Central and Eastern Europe (CEE) was created based on a request from the initial Environment for Europe Conference in 1991. During the 1993 Environment for Europe Conference, the EAP was endorsed. The Programme aims to work with nations to determine cost-effective and efficient means of developing, instituting, implementing, and enforcing environmental reforms. The EAP hopes to help solve the environmental problems of CEE while initially focusing on reducing environmental problems that threaten human health. The three main problem solving approaches considered by the EAP are: policy reform (e.g. market based instruments, regulations, and enforcement tools), institutional strengthening, and investment. The Programme has already begun development of National Environmental Action Programmes (NEAPs) that prioritise environmental needs within a country and address possible mechanisms for financing and evaluation.

The 1987 Montreal Protocol on Substances that Deplete the Ozone Layer

Article 10: Financial mechanism

1. The Parties shall establish a mechanism for the purposes of providing financial and technical co-operation, including the transfer of technologies, to Parties operating under paragraph 1 of Article 5 of this Protocol to enable their compliance with the control measures set out in Articles 2A to 2E, and any control measures in Articles 2F to 2H that are decided pursuant to paragraph 1 bis of Article 5 of the Protocol. The mechanism, contributions to which shall be additional to other financial transfers to Parties operating under that paragraph, shall meet all agreed incremental costs of such Parties in order to enable their compliance with the control measures of the Protocol. An indicative list of the categories of incremental costs shall be decided by the meeting of the Parties.

2. The mechanism established under paragraph 1 shall include a Multilateral Fund. It may also include other means of multilateral, regional and bilateral co-operation.

3. The Multilateral Fund shall:

(a) Meet, on a grant or concessional basis as appropriate, and according to criteria to be decided upon by the Parties, the agreed incremental costs;

(b) Finance clearing-house functions to:

(c) Finance the secretarial services of the Multilateral Fund and related support costs.

4. The Multilateral Fund shall operate under the authority of the Parties who shall decide on its overall policies.

5. The Parties shall establish an Executive Committee to develop and monitor the implementation of specific operational policies, guidelines and administrative arrangements, including the disbursement of resources, for the purpose of achieving the objectives of the Multilateral Fund. The Executive Committee shall discharge its tasks and responsibilities, specified in its terms of reference as agreed by the Parties, with the co-operation and assistance of the International Bank for Reconstruction and Development (World Bank), the United Nations Environment Programme, the United Nations Development Programme or other appropriate agencies depending on their respective areas of expertise. The members of the Executive Committee, which shall be selected on the basis of a balanced representation of the Parties operating under paragraph 1 of Article 5 and of the Parties not so operating, shall be endorsed by the Parties.

6. The Multilateral Fund shall be financed by contributions from Parties not operating under paragraph 1 of Article 5 in convertible currency or, in certain circumstances, in kind and/or in national currency, on the basis of the United Nations scale of assessments. Contributions by other Parties shall be encouraged. Bilateral and, in particular cases agreed by a decision of the Parties, regional co-operation may, up to a percentage and consistent with any criteria to be specified by decision of the Parties, be considered as a contribution to the Multilateral Fund, provided that such co-operation, as a minimum:

(a) Strictly relates to compliance with the provisions of this Protocol;

(b) Provides additional resources; and

(c) Meets agreed incremental costs.

7. The Parties shall decide upon the programme budget of the Multilateral Fund for each fiscal period and upon the percentage of contributions of the individual Parties thereto.

8. Resources under the Multilateral Fund shall be disbursed with the concurrence of the beneficiary Party.

9. Decisions by the Parties under this Article shall be taken by consensus whenever possible. If all efforts at consensus have been exhausted and no agreement reached, decisions shall be adopted by a two-thirds majority vote of the Parties present and voting, representing a majority of the Parties operating under paragraph 1 of Article 5 present and voting and a majority of the Parties not so operating present and voting.

Article 10 A: Transfer of technology

Each Party shall take every practicable step, consistent with the programmes supported by the financial mechanism, to ensure:

(a) that the best available, environmentally safe substitutes and related technologies are expeditiously transferred to Parties operating under paragraph 1 of Article 5; and

(b) that the transfers referred to in subparagraph (a) occur under fair and most favourable conditions.

Decision VI/16. Juridical personality, privileges and immunities of the Multilateral Fund

Recalling decision IV/18 of the Fourth Meeting of the Parties, which established the Financial Mechanism, including the Multilateral Fund for the Implementation of the Montreal Protocol, provided for in Article 10 of the Montreal Protocol, as amended in London on 29 June 1990,

- To clarify the nature and legal status of the Fund as a body under international law as follows:

(a) Juridical personality: The Multilateral Fund shall enjoy such legal capacity as is necessary for the exercise of its functions and the protection of its interests, in particular the capacity to enter into contracts, to acquire and dispose of movable and immovable property and to institute legal proceedings in defence of its interests;

(b) Privileges and immunities:

(i) The Fund shall, in accordance with arrangements to be determined with the Government of Canada, enjoy in the territory of the host country, such privileges and immunities as are necessary for the fulfilment of its purposes;

ARTICLE FOURTEEN

FINANCIAL ASPECTS

1. The Parties agree that, according to the specific needs of different regions and subregions, regional or sub-regional centres for training and technology transfers regarding the management of hazardous wastes and other wastes and the minimisation of their generation should be established. The Parties shall decide on the establishment of appropriate funding mechanisms of a voluntary nature.

2. The Parties shall consider the establishment of a revolving fund to assist on an interim basis in case of emergency situations to minimise damage from accidents arising from transboundary movements of hazardous wastes and other wastes or during the disposal of those wastes.

DECISIONS ADOPTED BY THE FIRST MEETING OF THE CONFERENCE OF THE PARTIES IN PIRIAPOLIS, URUGUAY ON 4 DECEMBER 1992

Decision I/7

INSTITUTIONAL AND FINANCIAL ARRANGEMENTS

The Conference,

Recalling paragraph 3 of Article 16 of the Basel Convention stipulating that at its first meeting the Conference of the Parties shall designate the Secretariat from among those existing competent intergovernmental organisations which have signalled their willingness to carry out the Secretariat functions under this Convention,

Having considered the note of the Executive Director of the United Nations Environment Programme in document UNEP/CHW.1/9 and its corrigenda,

1. Requests the United Nations Environment Programme to carry out the functions of the Basel Convention Secretariat;

2. Further requests the Executive Director of UNEP to establish the Secretariat in accordance with the structure contained in the budget and to have the Secretariat located in Geneva;

3. Approves the budget of the Convention and its Secretariat for 1993 and 1994 as included in the Annex I of this decision;

4. Decides that the contributions of the Parties to the budget of the Convention and its Secretariat shall be according to the formula in the annex to this decision and subject to consideration by the Open-ended Ad Hoc Committee of the distribution of the contributions for 1994;

5. Invites the Secretary-General of the United Nations to establish a Trust Fund for the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal and a technical co-operation trust fund to support developing countries and other countries in need of technical assistance in the implementation of the Basel Convention, in accordance with the financial regulations and rules of the United Nations, the general procedures governing the operations of the Environment Fund of the United Nations Environment Programme and the terms of reference for the administration of these Trust Funds to receive the contributions of the Parties for the implementation of the Convention (attached in Annex II to this decision);

6. Calls on Parties and non-Parties which agreed to contribute to pay their contributions as soon as possible so as to ensure the smooth functioning of the Secretariat and the implementation of the decisions of the Conference of the Parties;

7. Requests the Executive Director of UNEP to inform the Parties and non-Parties on the financial changes in the implementation of the Basel Convention and to request them to pay their contributions into the respective trust funds as soon as possible.

------------------------------------------------------------------------

Annex II

TERMS OF REFERENCE FOR THE ADMINISTRATION OF THE TRUST FUNDS FOR THE BASEL CONVENTION ON THE CONTROL OF TRANSBOUNDARY MOVEMENTS OF HAZARDOUS WASTES AND THEIR DISPOSAL

1. A Trust Fund for the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (hereinafter referred to as the Trust Fund) shall be established to provide financial support for the ordinary expenditure of the Secretariat of the Basel Convention. A Technical Co-operation Trust Fund (hereinafter referred to as the Technical Trust Fund) shall be established to assist developing countries and other countries in need of technical assistance in the implementation of the Basel Convention.

2. Pursuant to the Financial Regulations and Rules of the United Nations, the Executive Director of the United Nations Environment Programme (UNEP), with the approval of the Governing Council of UNEP, shall establish the Trust Funds for the administration of the Convention.

3. The Trust Fund shall be established for an initial period of two years, beginning 1 January 1993 and ending 31 December 1994. The appropriations of the Trust Fund for this period shall be financed from:

(a) Contributions made by the Parties to the Convention, by reference to the Table attached as an Appendix to the Budget, including additional contributions and contributions from any new Parties which are to be added to the Table;

(b) Contributions from States not Party to the Convention, other governmental, intergovernmental and non-governmental organisations, and other sources.

4. The Technical Trust Fund shall be established for an initial period of two years, beginning 1 January 1993 and ending 31 December 1994. The appropriation of the Technical Trust Fund for this period shall be financed from contributions made by the Parties and the non- Parties to the Convention.

5. The contributions referred to in Article 3 (a) above are to be based on the United Nations scale of assessments for the apportionment of the expenses of the United Nations (adjusted to provide that no one contribution shall exceed 25 per cent of the total).

6. The budget estimates, prepared in United States dollars, covering income and expenditure for each of the two calendar years 1993 and 1994 shall be as approved by the First Meeting of the Conference of the Parties to the Convention and further such budget estimates for subsequent periods of two years shall be prepared and approved at any ordinary or extraordinary meeting of the Parties. The Bureau shall prepare a report based on a special survey by the Secretariat for the Open-ended Ad Hoc Committee to review and provisionally adopt contributions to the budget for 1994 by the end of September 1993.

7. The decision of the Conference of the Parties on the budget, including contributions thereto, shall be made by consensus.

8. The Bureau of the Parties may, on the advice of the Executive Director, approve expenditure on any one or more objects of expenditure over and above the level approved by the Conference of the Parties for those objects of expenditure, provided that there shall be no overall increase in the budget above that approved by the Conference of the Parties.

9. Commitments against the resources of the Trust Fund may be made only if they are covered by the necessary income. No commitments shall be made in advance of the receipt of contributions.

10. In the event that the Executive Director of UNEP anticipates that there might be a shortfall in resources over the financial period as a whole, he shall, with the advice of the members of the Bureau, have discretion to adjust the budget so that expenditures are at all times fully covered by contributions received.

11. At the end of a calendar year of a financial period, the Executive Director may transfer any uncommitted balance of appropriations to the following calendar year.

12. All contributions are due to be paid in the year immediately preceding the year to which the contributions relate.

13 All contributions shall be paid in United States dollars into the following account: Account No. 015-002756, UNEP General Trust Funds Account, Chemical Bank, United Nations Branch, New York, N.Y. 10017, United States of America.

14. Contributions from States that become Parties after the beginning of the financial period shall be made pro rata temporis for the balance of the financial period.

15. Contributions not immediately required for the purpose of both Funds shall be invested at the discretion of the United Nations and any interest so earned shall be credited to the Fund.

16. The Executive Director shall deduct from the income of both Trust Funds an administrative support charge equal to 13 per cent of other expenditures recorded during any accounting period in order to meet the cost of administrative activities financed from both Trust Funds and provide services relating to personnel, accounting, audit, etc.

17. The financial period of both Trust Funds will be a biennium consisting of two consecutive calendar years. At the end of each calendar year of a financial period, the Executive Director shall submit to the Parties the certified accounts for the year and a report of activities under the Convention. He shall submit the accounts for the two-year financial period audited by the Board of Auditors of the United Nations as soon as practicable.

18. The General Procedures governing the operations of the Fund of UNEP and the Financial Regulations and Rules of the United Nations and these terms of reference shall govern the financial operations of the Convention.

19. In the event that the Parties wish both Trust Funds to be extended beyond 31 December 1994, the Executive Director of UNEP shall be so requested by the Parties at least six months earlier. Such extension of both Trust Funds shall be subject to the approval of the UNEP Governing Council.

Decision I/13

ESTABLISHMENT OF REGIONAL CENTRES FOR TRAINING AND TECHNOLOGY TRANSFER

The Conference,

Recalling Article 14, paragraph 1, which requires co-operation in the establishment of regional or subregional centres for training and technology transfer regarding the management of hazardous wastes and other wastes and the minimisation of their generation, according to the specific needs of different regions and subregions,

Also recalling Article 14, paragraph 1, which stipulates that Parties shall decide on the establishment of appropriate funding mechanisms of a voluntary nature for the establishment of such regional or subregional centres,

Taking note of the interest expressed by a number of countries, in particular by Argentina, China, El Salvador, Jordan, Lebanon, Nigeria, Poland and Uruguay,

Also noting paragraph 28(a) of the report of the Technical Working Group (to prepare draft technical guidelines for the environmentally sound management of wastes subject to the Basel Convention - Geneva, 25-27 March 1992 - UNEP/CHW/WG.4/2/2) which referred to the urgent need to establish regional centres to ensure an early implementation of the Basel Convention in accordance with Article 14 of the Convention, and recommended to refer this issue to the First Meeting of the Conference of the Parties.

1. Decides that one of the functions of the Open-ended Ad Hoc Committee of the Conference will be to identify the specific needs of different regions and subregions for training and technology transfer;

2. Requests its Open-ended Ad Hoc Committee to consider these expressions of interest further and to report to the Second Meeting of the Conference of the Parties on ways and means for the establishment and functioning of such centres, taking into consideration ongoing or future activities of regional centres or organisations/systems, as well as for the establishment of appropriate funding mechanisms of a voluntary nature for the establishment of such centres.

Decision I/14

EMERGENCY FUND

The Conference,

Recalling Article 14, paragraph 2, of the Basel Convention, which stipulates that "the Parties shall consider the establishment of a revolving fund to assist on an interim basis in case of emergency situations to minimise damage from accidents arising from the transboundary movements of hazardous wastes and other wastes or during the disposal of those wastes,"

Taking note of document UNEP/CHW.1/6, which includes the elements proposed by the Executive Director of UNEP for the establishment and functioning of such an emergency fund,

1. Requests the ad hoc working group of legal and technical experts established by decision I/5 to consider, having regard to document UNEP/CHW.1/6 and other relevant UNEP documents, the elements that would be required for establishing such an emergency fund, the relationship between such an emergency fund and the rules of procedures to be adopted in the field of liability and compensation, and the availability of institutions able to provide prompt and adequate assistance in emergency situations.

2. Further requests the ad hoc working group to present a progress report on its work to the Second Meeting of the Conference of the Parties, which includes an analysis of the likely impact of emergency situations of the size and nature of such emergency fund, taking into account the past emergency incidents and situations concerning transboundary movements of hazardous wastes and other wastes and their disposal.

Decision I/20

INTERNATIONAL COOPERATION: TRAINING AND SEMINARS RELATED TO THE BASEL CONVENTION

The Conference,

Recalling Article 10, paragraph 1, of the Basel Convention,

2. Invites Parties to contribute technically and financially towards the organisation of seminars, workshops and training programmes and towards covering the cost of participation of developing country representatives.

EXCERPTS FROM THE 1992 CONVENTION ON BIOLOGICAL DIVERSITY

Article 20. Financial Resources.

1. Each Contracting Party undertakes to provide, in accordance with its capabilities, financial support and incentives in respect of those national activities which are intended to achieve the objectives of this Convention, in accordance with its national plans, priorities and programmes.

2. The developed country Parties shall provide new and additional financial resources to enable developing country Parties to meet the agreed full incremental costs to them of implementing measures which fulfil the obligations of this Convention and to benefit from its provisions and which costs are agreed between a developing country Party and the institutional structure referred to in Article 21, in accordance with policy, strategy, programme priorities and eligibility criteria and an indicative list of incremental costs established by the Conference of the Parties. Other Parties, including countries undergoing the process of transition to a market economy, may voluntarily assume the obligations of the developed country Parties. For the purpose of this Article, the Conference of the Parties, shall at its first meeting establish a list of developed country Parties and other Parties which voluntarily assume the obligations of the developed country Parties. The Conference of the Parties shall periodically review and if necessary amend the list. Contributions from other countries and sources on a voluntary basis would also be encouraged. The implementation of these commitments shall take into account the need for adequacy, predictability and timely flow of funds and the importance of burden-sharing among the contributing Parties included in the list.

3. The developed country Parties may also provide, and developing country Parties avail themselves of, financial resources related to the implementation of this Convention through bilateral, regional and other multilateral channels.

4. The extent to which developing country Parties will effectively implement their commitments under this Convention will depend on the effective implementation by developed country Parties of their commitments under this Convention related to financial resources and transfer of technology and will take fully into account the fact that economic and social development and eradication of poverty are the first and overriding priorities of the developing country Parties.

5. The Parties shall take full account of the specific needs and special situation of least developed countries in their actions with regard to funding and transfer of technology.

6. The Contracting Parties shall also take into consideration the special conditions resulting from the dependence on, distribution and location of, biological diversity within developing country Parties, in particular small island States.

7. Consideration shall also be given to the special situation of developing countries, including those that are most environmentally vulnerable, such as those with arid and semi- arid zones, coastal and mountainous areas.

Article 21. Financial Mechanism

1. There shall be a mechanism for the provision of financial resources to developing country Parties for purposes of this Convention on a grant or concessional basis the essential elements of which are described in this Article. The mechanism shall function under the authority and guidance of, and be accountable to, the Conference of the Parties for purposes of this Convention. The operations of the mechanism shall be carried out by such institutional structure as may be decided upon by the Conference of the Parties at its first meeting. For purposes of this Convention, the Conference of the Parties shall determine the policy, strategy, programme priorities and eligibility criteria relating to the access to and utilisation of such resources. The contributions shall be such as to take into account the need for predictability, adequacy and timely flow of funds referred to in Article 20 in accordance with the amount of resources needed to be decided periodically by the Conference of the Parties and the importance of burden-sharing among the contributing Parties included in the list referred to in Article 20, paragraph 2. Voluntary contributions may also be made by the developed country Parties and by other countries and sources. The mechanism shall operate within a democratic and transparent system of governance.

Article 25. Subsidiary Body on Scientific, Technical and Technological Advice

Article 39. Financial Interim Arrangements

Provided that it has been fully restructured in accordance with the requirements of Article 21, the Global Environment Facility of the United Nations Development Programme, the United Nations Environment Programme and the International Bank for Reconstruction and Development shall be the institutional structure referred to in Article 21 on an interim basis, for the period between the entry into force of this Convention and the first meeting of the Conference of the Parties or until the Conference of the Parties decides which institutional structure will be designated in accordance with Article 21.

ANNEX II: DECISIONS ADOPTED BY THE FIRST MEETING OF THE CONFERENCE OF THE PARTIES (Nassau, Bahamas, from 28 November to 9 December 1994)

Decision I/2 Financial resources and mechanism

The Conference of the Parties

UNITED NATIONS FRAMEWORK CONVENTION ON CLIMATE CHANGE

ARTICLE 11 - FINANCIAL MECHANISM

1. A mechanism for the provision of financial resources on a grant or concessional basis, including for the transfer of technology, is hereby defined. It shall function under the guidance of and be accountable to the Conference of the Parties, which shall decide on its policies, programme priorities and eligibility criteria related to this Convention. Its operation shall be entrusted to one or more existing international entities.

2. The financial mechanism shall have an equitable and balanced representation of all Parties within a transparent system of governance.

3. The Conference of the Parties and the entity or entities entrusted with the operation of the financial mechanism shall agree upon arrangements to give effect to the above paragraphs, which shall include the following:

(a). Modalities to ensure that the funded projects to address climate change are in conformity with the policies, programme priorities and eligibility criteria established by the Conference of the Parties;

(b). Modalities by which a particular funding decision may be reconsidered in light of these policies, programme priorities and eligibility criteria;

(c). Provision by the entity or entities of regular reports to the Conference of the Parties on its funding operations, which is consistent with the requirement for accountability set out in paragraph 1 above; and

(d). Determination in a predictable and identifiable manner of the amount of funding necessary and available for the implementation of this Convention and the conditions under which that amount shall be periodically reviewed.

4. The Conference of the Parties shall make arrangements to implement the above- mentioned provisions at its first session, reviewing and taking into account the interim arrangements referred to in Article 21, paragraph 3, and shall decide whether these interim arrangements shall be maintained. Within four years thereafter, the Conference of the Parties shall review the financial mechanism and take appropriate measures.

ARTICLE 21 - INTERIM ARRANGEMENTS

1. The secretariat functions referred to in Article 8 will be carried out on an interim basis by the secretariat established by the General Assembly of the United Nations in its resolution 45/212 of 21 December 1990, until the completion of the first session of the Conference of the Parties.

2. The head of the interim secretariat referred to in paragraph 1 above will co-operate closely with the Intergovernmental Panel on Climate Change to ensure that the Panel can respond to the need for objective scientific and technical advice. Other relevant scientific bodies could also be consulted.

3. The Global Environment Facility of the United Nations Development Programme, the United Nations Environment Programme and the International Bank for Reconstruction and Development shall be the international entity entrusted with the operation of the financial mechanism referred to in Article 11 on an interim basis. In this connection, the Global Environment Facility should be appropriately restructured and its membership made universal to enable it to fulfil the requirements of Article 11.

REPORT OF THE CONFERENCE OF THE PARTIES ON ITS FIRST SESSION, HELD AT BERLIN FROM 28 MARCH TO 7 APRIL 1995

Addendum

PART TWO: ACTION TAKEN BY THE CONFERENCE OF THE PARTIES AT ITS FIRST SESSION

Decision 9/CP.1

Maintenance of the interim arrangements referred to in Article 21, paragraph 3, of the Convention

The Conference of the Parties,

Recalling Articles 11.4 and 21.3 of the United Nations Framework Convention on Climate Change,

Having considered the report by the Global Environment Facility (GEF) to the eleventh session of the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change, on the restructured Global Environment Facility,(8)

1. Decides that the restructured GEF shall continue, on an interim basis, to be the international entity entrusted with the operation of the financial mechanism referred to in Article 11 of the Convention;

2. Decides, in accordance with Article 11.4 of the Convention, to review the financial mechanism within four years and take appropriate measures, including a determination of the definitive status of the GEF in the context of the Convention.

10th plenary meeting

7 April 1995

Decision 10/CP.1

Arrangements between the Conference of the Parties and the operating entity or entities of the financial mechanism

The Conference of the Parties,

Recalling Article 11.3 of the United Nations Framework Convention on Climate Change,

Having considered recommendation 10 of the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change,

1. Takes note of the elements for inclusion in arrangements between the Conference of the Parties and an operating entity or entities of the financial mechanism presented in the note by the interim secretariat, contained in document A/AC.237/87, including comments made on relevant paragraphs at the eleventh session of the Committee;

2. Requests the secretariat, in consultation with the secretariat of the Global Environment Facility and bearing in mind comments made at the eleventh session of the Intergovernmental Negotiating Committee, to prepare draft arrangements for consideration by the Subsidiary Body for Implementation at its first session and adoption by the Conference of the Parties at its second session.

10th plenary meeting

7 April 1995

Decision 11/CP.1

Initial guidance on policies, programme priorities and eligibility criteria to the operating entity or entities of the financial mechanism

The Conference of the Parties,

Recalling Article 11.1 of the United Nations Framework Convention on Climate Change,

Having considered recommendation 11 of the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change,

1. Decides to adopt the following initial guidance on policies, programme priorities and eligibility criteria to the operating entity or entities of the financial mechanism:

(a) Regarding activities undertaken under Article 11 of the Convention,

Within the framework of the financial mechanism:

Annex II to the Convention, to assist them to take into full account the need for adequacy and predictability in the flow of funds. The entity or entities entrusted with the operation of the financial mechanism should take full account of the arrangements agreed with the Conference of the Parties, which, inter alia, shall include determination in a predictable and identifiable manner of the amount of funding necessary and available for the implementation of the Convention, as provided for in Article 11.3(d) of the Convention.

(b) Regarding programme priorities,

(c) Regarding eligibility criteria,

Eligibility criteria shall apply to countries and to activities and shall be applied in accordance with Article 11.1, 11.2 and 11.3;

(i) Regarding eligibility of countries, only countries that are Parties to the Convention would be eligible to receive funding upon entry into force of the Convention. In this context, only developing country Parties would be eligible to receive funding through the financial mechanism, in accordance with

Article 4.3;

(ii) Regarding eligibility of activities,

- Those activities related to obligations under Article 12.1 to communicate information for which the "agreed full costs" are to be met are eligible for funding;

(d) Regarding adaptation, the following policies, programme priorities and eligibility criteria should apply:

(ii) In the medium and long term, the following stages are envisaged for the particularly vulnerable countries or regions identified in Stage I:

(iii) Based on the outputs of the Stage I studies, as well as other relevant scientific and technical studies, such as those of the Intergovernmental Panel on Climate Change (IPCC), and any emerging evidence of the adverse effects of climate change, the Conference of the Parties may decide that it has become necessary to implement the measures and activities envisaged in Stages II and III, consistent with the relevant conclusions of the Committee and with the provisions of the Convention;

(iv) Funding for the implementation of such adaptation measures and activities would be provided as follows:

- For Stage I, the Conference of the Parties at its first session, shall entrust to the Global Environment Facility (GEF), the interim operating entity of the financial mechanism, the task of meeting the agreed full costs of the activities required by Article 12.1 of the Convention. This would include meeting the agreed full costs of relevant adaptation activities undertaken in the context of the formulation of national communications; such activities may include studies of the possible impacts of climate change, identification of options for implementing the adaptation provisions (especially the obligations contained in Article 4.1(b) and 4.1(e) of the Convention), and relevant capacity-building;

- If it is decided in accordance with paragraph (iii) above, that it has become necessary to implement the measures envisaged in Stages II and III, the Parties included in Annex II to the Convention will provide funding to implement the adaptation measures envisaged in these stages in accordance with their commitments contained in Article 4.3 and 4.4 of the Convention;

- In its review of the financial mechanism of the Convention under Article 11.4, the Conference of the Parties, taking into account studies conducted and options for adaptation identified during Stage I, any emerging evidence of the adverse effects of climate change, as well as the relevant conclusions reached by the Committee and its own decisions on this issue, must decide on the channel or channels, under Article 11 of the Convention, to be used for the funding referred to in the preceding subparagraph, to implement the adaptation measures envisaged in Stages II and III.

(e) Regarding agreed full incremental costs,

The various issues of incremental costs are complex and difficult and further discussion on the subject is therefore needed. The application of the concept of agreed full incremental costs should be flexible, pragmatic and on a case-by-case basis. Guidelines in this regard will be developed by the Conference of the Parties at a later stage on the basis of experience.

2. Also decides to take note of the following conclusions of the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change:

(a) Outside the framework of the financial mechanism,

Consistency should be sought and maintained between activities (including those related to funding) relevant to climate change undertaken outside the framework of the financial mechanism and the policies, programme priorities and eligibility criteria for activities as relevant, established by the Conference of the Parties. Towards this end and in the context of Article 11.5 of the Convention, the secretariat should collect information from multilateral and regional financial institutions on activities undertaken in implementation of Article 4.1 and Article 12 of the Convention; this should not introduce new forms of conditionalities.

(b) On transfer of technology, the Committee took note of document A/AC.237/88 prepared by the interim secretariat. The Committee recognised the importance of this subject under the relevant articles of the Convention and concluded that discussions should continue at the Conference of the Parties and its subsidiary bodies with a view to identifying ways and means of operationalizing the transfer of technology under Article 4.5 of the Convention.

(c) The Committee took note of document A/AC.237/Misc.40, an approach paper by the Group of 77 and China on the format of communication of information by Parties not included in Annex I to the Convention.

10th plenary meeting

7 April 1995

Decision 12/CP.1

Report of the Global Environment Facility to the Conference of the Parties on the development of an operational strategy and on initial activities in the field of climate change

The Conference of the Parties,

Recalling Article 11.1 of the United Nations Framework Convention on Climate Change,

Having considered the report by the Global Environment Facility (GEF) containing information on the development of an operational strategy in the climate change area and on the initial activities in this field (FCCC/CP/1995/4),

1. Welcomes the decision of the GEF Council to follow a "two-track" programming approach in 1995: while work is undertaken by the GEF secretariat to develop a long-term comprehensive operational strategy, supported by analytical work and consultations, and allowing for the guidance from the Conference of the Parties (track one), some project activities are to be undertaken to allow a smooth transition between the operations of the pilot phase and the restructured GEF (track two);

2. Decides to adopt a mixed strategy wherein projects will be selected with a double set of programme priorities as described in paragraph 9(c) of the report, that is, if they met either one of the long-term programme priorities or one of the short-term programme priorities;

3. Takes note of the report on initial activities;

4. Invites the GEF in future reports to take fully into account relevant aspects of the modalities for the functioning of operational linkages between the Conference of the Parties and the operating entity or entities of the financial mechanism.(9)

10th plenary meeting

7 April 1995

Decision 13/CP.1

Transfer of technology

The Conference of the Parties,

Recalling the relevant provisions of chapter 34 of Agenda 21 on "Transfer of environmentally sound technology, co-operation and capacity-building",

Pursuant to the relevant provisions of the United Nations Framework Convention on Climate Change, in particular, Articles 4.1, 4.5, 4.7, 4.9, 9.2 and 11.1,

1. Requests the Convention secretariat :

(a) To prepare an itemised progress report (according to the types of activities specified in paragraphs 34.15 to 34.28, inclusive, of chapter 34 of Agenda 21) on concrete measures taken by the Parties listed in Annex II to the Convention, with respect to their commitments related to the transfer of environmentally sound technologies and the know-how necessary to mitigate and facilitate adequate adaptation to climate change; and, at the same time,

(b) To collect information from relevant sources, from, inter alia, the Commission on Sustainable Development, United Nations agencies, the Intergovernmental Panel on Climate Change and the Subsidiary Body for Scientific and Technological Advice, and to prepare an inventory and assessment of environmentally sound and economically viable technologies and know-how conducive to mitigating and adapting to climate change. This inventory should also include an elaboration of the terms under which transfers of such technologies and know-how could take place;

2. Further requests the Convention secretariat:

(a) To submit the documents referred to in subparagraphs 1 (a) and (b) above, through the Subsidiary Body for Scientific and Technological Advice, to the Conference of the Parties at its second session, and to update them at regular intervals (each interval not to exceed a year) for consideration by the Conference of the Parties at each of its sessions;

(b) To take the advice of the Subsidiary Body for Scientific and Technological Advice (as described in section A, paragraph 3, of annex I to decision 6/CP.1) in implementing these responsibilities and to co-ordinate this matter with the relevant United Nations agencies and other organisations and institutions;

3. Urges:

(a) The Parties listed in Annex II to the Convention to include in their national communications (10) the measures taken for the transfer of technology in order to enable the Convention secretariat to compile, analyse and then submit the above-mentioned documents to each session of the Conference of the Parties;

(b) Other Parties to include in their communications, where possible, information on measures taken for the transfer of technology in order to enable the Convention secretariat to compile, analyse and then submit the above-mentioned documents to each session of the Conference of the Parties;

4. Decides:

(a) To review, at the second session of the Conference of the Parties, and at each session of the Conference of the Parties thereafter, the implementation of Article 4.5 and 4.1(c) of the Convention as a separate agenda item under "Matters relating to commitments";

(b) To provide continuous advice to improve the operational modalities for the effective transfer of technology;

(c) To support and promote the development of endogenous capacities and appropriate technology relevant to the objectives of the Convention in developing countries which are Parties to the Convention.

10th plenary meeting

7 April 1995

III. OTHER ACTION TAKEN BY THE CONFERENCE OF THE PARTIES

(a) Modalities for the functioning of operational linkages between the Conference of the Parties and the operating entity or entities of the financial mechanism

At its 10th plenary meeting, on 7 April 1995, the Conference endorsed the following agreed conclusions of the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change:

1. The Conference of the Parties, the supreme body of the Convention, and the entity or entities entrusted with the operation of the financial mechanism, shall agree upon arrangements to give effect to the provisions of Article 11.1 and 11.2 through the operational linkages which are discussed below;

2. In line with Article 11.1 of the Convention, the Conference of the Parties will, after each of its sessions, communicate to the governing body of the operating entity relevant policy guidance for implementation and action by that governing body, which shall accordingly ensure the conformity of the entity's work with the guidance of the Conference of the Parties. Guidance from the Conference of the Parties will address issues relating to policies, programme priorities and eligibility criteria, as well as possible relevant aspects of the activities of the operating entity that are related to the Convention;

3. The governing body of the operating entity has the responsibility of ensuring that funded projects related to the Convention are in conformity with the policies, eligibility criteria and programme priorities established by the Conference of the Parties. It will report regularly to the Conference of the Parties on its activities related to the Convention and on the conformity of those activities with the guidance received from the Conference of the Parties;

4. Regular reports by the Chairman or secretariat of the operating entity to its governing body will be made available to the Conference of the Parties through its secretariat. Other official documentation of the operating entity should also be made available to the Conference of the Parties through its secretariat;

5. In addition, the Conference of the Parties should receive and review at each of its sessions a report from the governing body of the operating entity which should include specific information on how it has applied the guidance and decisions of the Conference of the Parties in its work related to the Convention. This report should be of a substantive nature and incorporate the programme of future activities of this entity in the areas covered by the Convention and an analysis on how the entity, in its operations, implemented the policies, eligibility criteria and programme priorities related to the Convention established by the Conference of the Parties. In particular, a synthesis of the different projects under implementation and a listing of the projects approved in the areas covered by the Convention, as well as a financial report including accounting and evaluation of its activities in the implementation of the Convention, indicating the availability of resources, should be included;

6. In order to meet the requirements of its accountability to the Conference of the Parties, reports submitted by the governing body of the operating entity should cover all its activities carried out in implementing the Convention, whether decisions on such activities are made by the governing body of the operating entity or by bodies operating under its auspices for the implementation of its programme. To this end, it shall make such arrangements with such bodies as might be necessary regarding the disclosure of information;

7. The funding decisions for specific projects should be agreed between the developing country Party concerned and the operating entity in conformity with policy guidance from the Conference of the Parties. However, if any Party considers that a decision regarding one of the specific projects does not comply with the policies, eligibility criteria and programme priorities established by the Conference of the Parties in the context of the Convention, the Conference of the Parties should analyse the observations presented and take decisions on the basis of compliance with such policies, eligibility criteria and programme priorities. In the event that the Conference of the Parties considers that this specific project decision does not comply with the policies, eligibility criteria and programme priorities established by the Conference of the Parties, it may ask the governing body of the operating entity for further clarification on this specific project decision and in due time ask for a reconsideration of that decision;

8. The Conference of the Parties will periodically review and evaluate the effectiveness of all modalities established in accordance with Article 11.3. Such evaluations will be taken into account by the Conference of the Parties in its decision, pursuant to Article 11.4, on the arrangements for the financial mechanism.

(b) Provision to developing country Parties of technical and financial support

At its 10th plenary meeting, on 7 April 1995, the Conference of the Parties took note of the following conclusion reached in Working Group II of the Intergovernmental Negotiating Committee at its eleventh session:

"Bearing in mind the views expressed by representatives, and without prejudice to the guidance that the Conference of the Parties may provide in the future, the interim secretariat was requested to continue to facilitate the provision of technical and financial support to Parties, in co-operation with its partners, and to periodically report back to the Conference of the Parties on progress achieved, so that further guidance could be provided."

CONFERENCE OF THE PARTIES

Fourth session
Buenos Aires, 2-13 November 1998
Item 2 (c) and (f) of the provisional agenda
PROVISIONAL AGENDA AND ANNOTATIONS

(b) Financial mechanism

59. The Memorandum of Understanding (MOU) between the COP and the Council of the Global Environment Facility provides, inter alia, that the COP should receive and review at each of its sessions a report from the GEF which should include specific information on how it has applied the guidance and decisions of the COP in its work related to the Convention (decisions 11/CP.2 and 12/CP.2). Accordingly, the COP will have before it a report from the Council of the GEF (see FCCC/CP/1998/12 and Add.1).

60. The MOU between the COP and the Council of the GEF further provides that the Conference of the Parties will, after each of its sessions, communicate to the GEF any policy guidance approved by the COP concerning the financial mechanism. The COP at its first session decided on initial guidance on policies, programme priorities and eligibility criteria to the operating entity or entities of the financial mechanism (decision 11/CP.1) and at its second session provided further guidance (decision 11/CP.2).

61. The SBI, at its eighth session, after considering matters related to the financial mechanism, including any guidance thereto, invited Parties to submit further views and comments. The SBI decided to continue its discussions at its ninth session (see FCCC/SBI/1998/6, para. 32 (b)). The Parties will have before them documents FCCC/SBI/1998/MISC.4 and Add.1 and FCCC/CP/1998/MISC.3 which contain views and comments on these matters received from Parties.

62. The COP may wish to refer this sub-item to the SBI for its consideration with a view to developing conclusions and/or draft decisions to submit to the COP concerning the report of the GEF and any further policy guidance to the financial mechanism that may be appropriate. The SBI will also need to take account of deliberations under other agenda items that could be relevant to the provision of policy guidance. In this context, the SBSTA has requested the SBI, in considering additional guidance to the GEF, to take note that priority should be given to the need to build capacity in developing countries to identify and analyse technology and technology information needs, and has noted that funding is essential to the implementation of Article 6

(see FCCC/SBSTA/1998/6, para. 58 (b)).

63. In accordance with Article 11.4 of the Convention, the COP at its first session decided to review the financial mechanism within four years and to take appropriate measures, including a determination of the definitive status of the GEF in the context of the Convention (decision 9/CP.1). Accordingly, the COP should conclude this process at the present session.

64. The review process began at the fifth session of the SBI, at the request of the COP at its second session (decision 11/CP.2), and on the basis of guidelines contained in paragraph 20 of document FCCC/SBI/1997/6. The process continued throughout the sixth, seventh and eighth sessions of the SBI. The SBI decided to continue its discussions at its ninth session

(see FCCC/SBI/1998/6, para. 32 (b)). The COP will have before it documents FCCC/SBI/1998/MISC.4 and Add.1 and FCCC/CP/1998/MISC.3 which contain views and comments on these matters received from Parties.

65. The COP may wish to refer this sub-item to the SBI for consideration with a view to developing conclusions and/or draft decisions to submit to the COP on the conclusion of the review process referred to in decision 9/CP.1.

(c) Development and transfer of technologies

66. At its first session, the COP decided, inter alia, "to review, at the second session of the Conference of the Parties, and at each session of the Conference of the Parties thereafter, the implementation of Article 4.5 and 4.1(c) of the Convention as a separate agenda item" (decision 13/CP.1). This decision was reaffirmed by COP 2 (decision 7/CP.2) and by COP 3 (decision 9/CP.3).

67. At its eighth session, the SBSTA requested the secretariat to prepare an initial draft of a work programme on the development and transfer of technologies (see FCCC/SBSTA/1998/6, para. 58 (c)). This is included in the progress report on development and transfer of technologies presented in document FCCC/CP/1998/6.

68. The SBSTA also invited Parties to provide, by 15 August 1998, their views regarding technology development and transfer, capacity building, the tasks described in the secretariat's progress report on technology and technology transfer (see FCCC/SB/1997/1), any additional tasks, and the strategic focus of the secretariat's work programme on the development and transfer of technologies. Submissions from Parties on these topics will be contained in document FCCC/CP/1998/MISC.5.

69. The SBSTA also requested the secretariat to organise a technology round table in conjunction with COP 4. The focus of this round table was specified as the analysis of barriers to the development and transfer of technology (in both Annex I and non-Annex I Parties) and the identification and elimination of these barriers in order to facilitate the development and transfer of technology (see FCCC/SBSTA/1998/6, para. 58 (e)). Further information on this round table will be conveyed in due course.

70. In addition, the SBSTA urged the secretariat to complete the technical paper on barriers and opportunities related to the transfer of technology for the ninth session. This will be submitted as document FCCC/TP/1998/1. Information in this document may be directly relevant to the consideration of the draft work programme mentioned in paragraph 67 above.

71. Parties may also wish to consider aspects of the second compilation and synthesis of second national communications from Annex I Parties (see FCCC/CP/1998/11 and Add.1 and 2) related to financial resources and transfer of technology.

The United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa

Article 21. Financial mechanisms

1. The Conference of the Parties shall promote the availability of financial mechanisms and shall encourage such mechanisms to seek to maximize the availability of funding for affected developing country Parties, particularly those in Africa, to implement the Convention. To this end, the Conference of the Parties shall consider for adoption inter alia approaches and policies that:

(a) facilitate the provision of necessary funding at the national, subregional, regional and global levels for activities pursuant to relevant provisions of the Convention;

(b) promote multiple-source funding approaches, mechanisms and arrangements and their assessment, consistent with article 20;

(c) provide on a regular basis, to interested Parties and relevant intergovernmental and non- governmental organisations, information on available sources of funds and on funding patterns in order to facilitate co-ordination among them;

(d) facilitate the establishment, as appropriate, of mechanisms, such as national desertification funds, including those involving the participation of non-governmental organisations, to channel financial resources rapidly and efficiently to the local level in affected developing country Parties; and

(e) strengthen existing funds and financial mechanisms at the subregional and regional levels, particularly in Africa, to support more effectively the implementation of the Convention.

2. The Conference of the Parties shall also encourage the provision, through various mechanisms within the United Nations system and through multilateral financial institutions, of support at the national, subregional and regional levels to activities that enable developing country Parties to meet their obligations under the Convention.

3. Affected developing country Parties shall utilise, and where necessary, establish and/or strengthen, national co-ordinating mechanisms, integrated in national development programmes, that would ensure the efficient use of all available financial resources. They shall also utilise participatory processes involving non-governmental organisations, local groups and the private sector, in raising funds, in elaborating as well as implementing programmes and in assuring access to funding by groups at the local level. These actions can be enhanced by improved co-ordination and flexible programming on the part of those providing assistance.

4. In order to increase the effectiveness and efficiency of existing financial mechanisms, a Global Mechanism to promote actions leading to the mobilisation and channelling of substantial financial resources, including for the transfer of technology, on a grant basis, and/or on concessional or other terms, to affected developing country Parties, is hereby established. This Global Mechanism shall function under the authority and guidance of the Conference of the Parties and be accountable to it.

5. The Conference of the Parties shall identify, at its first ordinary session, an organisation to house the Global Mechanism. The Conference of the Parties and the organisation it has identified shall agree upon modalities for this Global Mechanism to ensure inter alia that such Mechanism:

(a) identifies and draws up an inventory of relevant bilateral and multilateral co-operation programmes that are available to implement the Convention;

(b) provides advice, on request, to Parties on innovative methods of financing and sources of financial assistance and on improving the co-ordination of co-operation activities at the national level;

(c) provides interested Parties and relevant intergovernmental and non-governmental organisations with information on available sources of funds and on funding patterns in order to facilitate co-ordination among them; and

(d) reports to the Conference of the Parties, beginning at its second ordinary session, on its activities.

6. The Conference of the Parties shall, at its first session, make appropriate arrangements with the organisation it has identified to house the Global Mechanism for the administrative operations of such Mechanism, drawing to the extent possible on existing budgetary and human resources.

7. The Conference of the Parties shall, at its third ordinary session, review the policies, operational modalities and activities of the Global Mechanism accountable to it pursuant to paragraph 4, taking into account the provisions of article 7. On the basis of this review, it shall consider and take appropriate action.

From the First Session of the Conference of Parties to the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa (CCD) (October 1997)

Decision 24/COP.1

Organisation to house the Global Mechanism and agreement on its modalities

The Conference of the Parties,

Recalling that the Conference of the Parties (COP), in accordance with article 21, paragraphs 5 and 6, of the Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, particularly in Africa, shall:

(a) identify, at its first ordinary session an organisation to house the Global Mechanism established under article 21, paragraph 4, of the Convention;

(b) agree with the organisation it has identified upon the modalities for the Global Mechanism; and

(c) make, at its first session, appropriate arrangements with the organisation it has identified to house the Global Mechanism for the administrative operations of such Mechanism, drawing to the extent possible on existing budgetary and human resources,

Having examined the recommendations of the Intergovernmental Negotiating Committee for the Elaboration of an International Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa (INCD) regarding the functions of the Global Mechanism, and the criteria for selecting an institution to house it, as reflected in Appendix I of document ICCD/COP(1)/5 and in paragraphs 1 and 2 of the Committee's decision 10/3, taken at the first part of its tenth session, with the amendment contained in document ICCD/COP(1)/5/Add.1,

Recalling decision 10/18 of the INCD, taken at its resumed tenth session, which, inter alia:

(a) requests the COP at its first session to consider the offers of the International Fund for Agricultural Development (IFAD) and the United Nations Development Programme (UNDP), including any suggestions they deem necessary, and to take appropriate action on the matters related to the selection of an institution to house the Global Mechanism; and

(b) requests the Permanent Secretariat of the Convention, in consultation with IFAD and UNDP, to develop proposals on administrative and operational modalities of the Global Mechanism for consideration and adoption by the COP at its first session,

Noting with appreciation the revised offer of IFAD to house the Global Mechanism, contained in Appendix II of document ICCD/COP(1)/5, as supplemented by document ICCD/COP(1)/CRP.3, prepared in response to operative paragraph 1 of INCD decision 10/18,

Also noting with appreciation the revised offer of UNDP to house the Global Mechanism, contained in Appendix III of document ICCD/COP(1)/5, as supplemented by document ICCD/COP(1)/CRP.2, prepared in response to operative paragraph 1 of INCD decision 10/18,

Noting further document ICCD/COP(1)/5/Add.2/Rev.1, which contains proposals developed by the Permanent Secretariat, in consultation with IFAD and UNDP regarding the administrative and operational modalities of the Global Mechanism,

1. Decides to select IFAD to house the Global Mechanism on the basis of criteria agreed on in Section B of the Annex to INCD decision 10/3;

2. Decides also that the Global Mechanism, in carrying out its mandate, under the authority and guidance of the COP, should perform the functions described in the annex to this decision;

3. Requests the Permanent Secretariat, in consultation with the organisation to house the Global Mechanism, as well as the other two collaborating institutions referred to in decision 25/COP.1, to develop a memorandum of understanding between the COP and appropriate body or organisation for consideration and adoption at the second session of the COP;

4. Requests also the Permanent Secretariat and the organisation housing the Global Mechanism, in consultation with the two other collaborating institutions, in developing the memorandum of understanding referred to in paragraph 3 above, to take fully into account document ICCD/COP(1)/5 and other related documents, including document ICCD/COP(1)/CRP.1, to address, inter alia, the following:

(a) the separate identity of the Global Mechanism within the housing organisation;

(b) the measures to be taken to assure full accountability and full reporting to the COP;

(c) the field office support available for Global Mechanism activities;

(d) the administrative infrastructure available to support the Global Mechanism; and

(e) arrangements for the handling of resources made available for Global Mechanism functioning and activities;

5. Further requests the organisation housing the Global Mechanism and the Permanent Secretariat to work out appropriate arrangements for liaison and co-operation between the Permanent Secretariat and the Global Mechanism in order to avoid duplication and to enhance the effectiveness of Convention implementation in accordance with their respective roles in implementation;

6. Invites relevant institutions, programmes and bodies of the United Nations system, including the United Nations Food and Agriculture Organisation (FAO), the Global Environment Facility (GEF), the United Nations Environment Programme (UNEP) and the World Food Programme (WFP), intergovernmental, regional and subregional organisations and regional development banks, as well as interested non-governmental organisations (NGOs) and the private sector, to actively support the activities of the Global Mechanism;

7. Urges Governments and all interested organisations, including non-governmental organisations and the private sector, to make promptly the voluntary contributions necessary to ensure that the Global Mechanism can begin operating on 1 January 1998 on the basis of Section A of Appendix I of document ICCD/COP(1)/5 and continue effective operations on the basis of the memorandum of understanding referred to in paragraph 3 above after its adoption by the second session of the COP;

8. Reiterates that, in accordance with article 21, paragraph 7 of the Convention, the COP shall, at its third ordinary session, review the policies, operational modalities and activities of the Global Mechanism and, on the basis of this review, shall consider and take appropriate action.

ANNEX. FUNCTIONS OF THE GLOBAL MECHANISM

In order to increase the effectiveness and efficiency of existing financial mechanisms, a global mechanism is established to promote actions leading to the mobilisation and channelling of substantial financial resources.

In accordance with the relevant provisions of the Convention, in particular articles 7, 20 and 21, and the financial provisions of relevant regional implementation annexes, the global mechanism shall function under the authority and guidance of the Conference of the Parties, including on policies, operational modalities and activities, and be accountable and make regular reports to it, according to the principles of transparency, neutrality and universality. The global mechanism, in carrying out its mandate under article 21, paragraph 4, should perform the following functions:

1. Collecting and disseminating information

(a) Identify potential sources of financing from bilateral donors, the United Nations system, multilateral financial institutions, regional and subregional financial mechanisms, and non-governmental organisations, foundations and other private sector entities, and establish relationships and maintain contacts with them.

(b) Establish and update an inventory of the financial needs of affected developing country Parties for carrying out action programmes, as well as other relevant activities related to the implementation of the Convention, on the basis of information provided under relevant articles of the Convention.

(c) Identify and draw up an inventory of relevant bilateral and multilateral co-operation programmes and available financial resources in the form of a comprehensive database, incorporating information both from Parties and from various financial mechanisms, comprising:

(i) Sources of available financing through bilateral and multilateral agencies, including their funding patterns and eligibility criteria, using reports to the Conference of the Parties by Parties and all other available data;

(ii) Sources of financing from non-governmental organisations, foundations, academic institutions and other private sector entities that might be encouraged to provide funding, including their funding patterns and eligibility criteria;

(iii) National funding in affected country Parties to finance actions designed to combat desertification and/or mitigate the effects of drought.

(d) Disseminate information collected in accordance with paragraphs (a), (b) and (c) to Parties on a regular basis and make it available, on request, to interested intergovernmental and non-governmental organisations.

2. Analysing and advising on request

(a) Promote the matching of available resources to the projects and programmes of affected developing countries related to combating desertification, including assisting them to find new and additional resources for the implementation of the Convention.

(b) Analyse and provide advice on sources of financial assistance and on mechanisms to channel resources to the local, national and subregional levels, including through non-governmental organisations and private sector entities.

(c) Provide advice on the establishment, financing and management of national desertification funds.

(d) Identify, promote and provide advice about innovative methods and incentives for mobilising and channelling resources.

3. Promoting actions leading to co-operation and co-ordination

(a) Disseminate information it collects so as to facilitate the assessment of, and exchange of information on, the effectiveness of financial assistance, including its accessibility, predictability, flexibility, quality and local-level orientation.

(b) Provide identified United Nations agencies, funds and programmes, and multilateral financial institutions, with information and stimulate co-ordination among them, including in multiple-source financing.

(c) Encourage, and facilitate co-ordination through the provision of information and other measures concerning relevant multiple-source financing approaches, mechanisms and arrangements, such as co-financing, parallel financing, consortia and joint programmes.

(d) Increase awareness of the Convention, and promote the participation in its implementation, of identified foundations, academic institutions, non-governmental organisations and other private sector entities and facilitate contacts with them by interested Parties, in order to contribute to the mobilisation and channelling of substantial financial resources.

(e) Provide information, making use of the Conference of the Parties and other relevant existing forums, that will:

(i) Facilitate discussion of relevant issues in the governing bodies of multilateral financial institutions;

(ii) Inform Parties about the eligibility criteria and projects of international financial instruments and mechanisms, including particularly the Global Environment Facility (GEF), as they relate to implementation of the Convention;

(iii) Inform affected country Parties about each other's relevant activities;

(iv) Disseminate methodologies developed by Parties to identify and prioritise the financial needs of action programmes at all levels;

(v) Promote full use and continued improvement of the funding sources to be utilised for the implementation of the Convention referred to in relevant articles of the Convention.

(f) Identify and then provide information and advice on financing sources for the transfer, acquisition, adaptation and development of environmentally sound, economically viable and socially acceptable technologies relevant to combating desertification and/or mitigating the effects of drought.

(g) Promote partnership building as it relates to the support of the mobilisation of financial resources for the implementation of the Convention at the local, national, subregional and regional levels.

(h) Facilitate the financing of information exchange on best practices utilised in combating desertification and/or mitigating the effects of drought at the local level in affected developing country Parties.

4. Mobilising and channelling financial resources

(a) Promote actions leading to the mobilisation and channelling of financial resources to all levels in accordance with the provisions of the Convention.

(b) Undertake actions and/or activities, in partnership particularly with developed country Parties, and relevant institutions, that shall, consistent with the Convention, mobilise and maximise for the purpose of the Convention adequate and substantial financial resources, including, as agreed in the Convention, new and additional resources, on a grant or, if necessary, concessional basis, to fund activities under action programmes of affected developing country Parties, particularly those in Africa, at all levels in conformity with the Convention and with the particular conditions of the regions of relevant regional implementation annexes.

(c) Promote the use of existing bilateral and multilateral financial mechanisms and arrangements that mobilise and channel substantial financial resources to affected developing country Parties in combating desertification and mitigating the effects of drought.

(d) Undertake actions and/or activities for the mobilisation of adequate, timely and predictable financial resources, including new and additional funding from the Global Environment Facility of the agreed incremental costs of those activities concerning desertification that relate to its four focal areas, in conformity with the relevant provisions of the instrument establishing the Global Environment Facility.

(e) Guide and direct, as requested and as appropriate, the channelling and allocation of resources mobilised for the purpose of the Convention from bilateral and multilateral sources through the host, and other organisations in an adequate, predictable and timely fashion to local, national, subregional and regional levels for the implementation of action programmes, projects and activities to combat desertification and/or mitigate the effects of drought in affected developing country Parties, particularly in Africa.

(f) Use, as requested and appropriate, its own resources made available to it through trust fund(s) and/or equivalent arrangements established by the host organisation for the Global Mechanism's functioning and activities, as defined in this annex, from bilateral and multilateral sources through the host organisation and from the budget of the Convention.

(g) Encourage, in conjunction with the Conference of the Parties, the provision, through various mechanisms within the United Nations system and through multilateral financial institutions, of support at the national, subregional and regional levels to activities that enable developing country Parties to meet their obligations under the Convention.

(h) Increase the efficiency and effectiveness of existing financial mechanisms and collaborate with them to facilitate and catalyse the mobilisation and channelling by them of adequate and substantial financial resources, including new and additional resources, for implementation of the Convention.

(i) Play, among other functions, a catalytic role, in ensuring the availability of resources for project and programme design and implementation from bilateral and multilateral sources.

(j) Promote and facilitate, through the actions in paragraphs (a) to (i):

(i) The transfer, acquisition, adaptation and development of environmentally sound, economically viable and socially acceptable technologies, knowledge, know-how and practices relevant to combating desertification and/or mitigating the effects of drought in affected developing countries, in conformity with the Convention.

(ii) The use of indigenous and traditional knowledge and technologies, as well as local expertise, at all levels in affected developing countries.

5. Reporting to the Conference of the Parties

(a) Provide reports to the sessions of the Conference of the Parties on its activities, including in those reports the following:

(i) The operations and activities of the global mechanism, including the effectiveness of its activities in promoting the mobilisation and channelling of the substantial financial resources referred to in paragraph 4 (a) above to affected developing country Parties;

(ii) The assessment of future availability of funds for implementation of the Convention, as well as assessment and proposals for effective ways and means of providing such funds.

Decision 25/COP.1

Collaborative institutional arrangements in support of the Global Mechanism

The Conference of the Parties,

Having examined decision 10/18 of the Intergovernmental Negotiating Committee for the Elaboration of a Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa (INCD), taken at its resumed tenth session, which, inter alia, invites the International Fund for Agricultural Development (IFAD), the United Nations Development Programme (UNDP) and the World Bank to consult on and develop a proposal on the possible collaborative institutional arrangements for the Global Mechanism for submission to, consideration by and appropriate action by the Conference of the Parties (COP) at its first session,

Welcoming, as an important element in the successful functioning of the Global Mechanism, the agreement of IFAD, UNDP and the World Bank on collaborative institutional arrangements for the Global Mechanism, as reflected in document ICCD/COP(1)/CRP.1, annexed to this decision,

1. Decides that this agreement shall serve as the initial basis for collaborative institutional arrangements in support of the Global Mechanism by the three organisations;

2. Decides also that, in carrying out the functions of the Global Mechanism, in accordance with its decision 24/COP.1, the organisation to house the Global Mechanism shall, as the lead organisation, fully co-operate with the other two institutions that entered into the collaborative institutional arrangements described in document ICCD/COP(1)/CRP.1;

3. Urges the three institutions concerned to proceed with the arrangements proposed in document ICCD/COP(1)/CRP.1, including the establishment of a facilitation committee, and requests the three institutions to actively pursue and develop further those arrangements and report to the second session of the COP;

4. Invites relevant institutions, programmes and bodies of the United Nations system, including the Food and Agriculture Organisation of the United Nations (FAO), the Global Environment Facility (GEF), the United Nations Environment Programme (UNEP) and the World Food Programme (WFP), regional and subregional organisations and regional development banks, as well as interested non-governmental organisations (NGOs) and the private sector, to actively support the activities of the Global Mechanism, as contemplated in paragraph 5 of the annex to document ICCD/COP(1)/CRP.1 and, in this connection, to establish and/or strengthen programmes to combat desertification in affected developing countries;

5. Requests the organisation housing the Global Mechanism to report to the second session of the COP on modalities regarding collaboration between itself and the NGO community, as well as collaboration with other interested organisations, including the private sector.

ANNEX. COLLABORATIVE INSTITUTIONAL ARRANGEMENTS FOR THE GLOBAL MECHANISM OF THE UNITED NATIONS CONVENTION TO COMBAT DESERTIFICATION

19 SEPTEMBER 1997

I. Context

1. Operative paragraph 3 of the INCD 10 Resumed Session decision on the housing of the Global Mechanism (GM) invited IFAD, UNDP and the World Bank to "consult on and develop a proposal on the possible collaborative institutional arrangement for the Global Mechanism for submission to, consideration and appropriate action by the COP at its first session".

II. The Global Mechanism

3. The three institutions share the view that the objective of the Global Mechanism is to increase the flow of resources for CCD implementation, while increasing the effectiveness and efficiency of existing financial mechanisms.

4. In order to serve Parties effectively in meeting the Convention's financial provisions, the three institutions based their proposal on the following principles as embodied in the spirit of the CCD:

- oriented towards issues of finance (including for the transfer of technology);

- highly flexible in operations, responding to emerging opportunities;

- neutrality and universality will form the basis for the operations of the GM;

- the GM would have access to resources, through its host and other organisations, as outlined in paragraph 4(e) of INCD negotiating text on the functions of GM; and

- the administrative and operating budget of the GM would be financed by the COP.

III. Support for the Global Mechanism

5. The three institutions recognise that the Global Mechanism would need to draw on the support of a large number of relevant organisations. This would include IFAD, UNDP and the World Bank as well as Regional Development Banks, FAO, WFP, UNEP and other organisations, including NGOs.

6. The World Bank, while not seeking to house the GM, would actively support the GM. Regardless of whether IFAD or UNDP house the GM, and without prejudging the nature of any collaborative institutional arrangement, the three institutions would at least support the CCD and the GM in the ways outlined below.

General

7. IFAD, UNDP and the World Bank would establish a "Facilitation Committee" for the GM, to co-ordinate support from the three institutions, comprised initially of focal points to be designated by each institution. The functions and scope of the work of this committee would be developed by the three institutions in consultation with the institution housing the GM and the Head of the GM.

The World Bank

9. The World Bank would support the GM, housed by IFAD and/or UNDP, as follows:

(a) The Bank through its Drylands Knowledge Node would support the GM by generating and disseminating information and knowledge on technical issues and financial resource information flows;

(b) The Bank would integrate appropriate drylands management policies in its Environmental Sector Work and Country Assistance Strategies and use these in its ongoing dialogue with affected countries to internalize drylands management issues within the countries' economic development programmes, and thus bring them forward for financing in the Bank's active portfolio and other donors' support;

(d) The Bank would establish an institutional focal point to liaise with the GM, and with IFAD and UNDP on GM issues.

IFAD

10. IFAD's offer to house the Global Mechanism is contained in ICCD/COP(1)/5. Notwithstanding what it would offer if selected as housing institution, IFAD would nevertheless support the GM as follows:

(a) IFAD would seek to achieve optimal convergence between its financial assistance for poverty alleviation in the drylands and Affected Country priorities under the Convention;

(c) IFAD would establish an institutional focal point to liaise with the GM and with UNDP and the World Bank on GM issues.

UNDP

11. UNDP's offer to house the Global Mechanism is contained in ICCD/COP(1)/5. Notwithstanding what it would offer if selected as housing institution, UNDP would nevertheless support the GM as follows:

(b) Provide technical backstopping to National Desertification Fund (NDF) establishment;

(c) Continue its work on Drought Preparedness and Mitigation (DPM), Environmental Information System (EIS)/Desertification Information System (DIS) and indicators, including monitoring and assessment linked appropriately to the work of the Committee on Science and Technology (CST);

(d) Continue its work on special thematic initiatives (water management, women, NGO participation, advocacy on drylands);

(e) Continue to mobilise seed/catalytic resources through UNDP Trust Fund for the above activities;

(h) UNDP would establish an institutional focal point to liaise with the GM, and with IFAD and the World Bank on GM issues.

IV. Specific Features of Collaborative Institutional

Arrangements for the GM

12. The selection of the head of GM would take place through consultation between the President of IFAD and the Administrator of UNDP, keeping the President of the World Bank informed.

13. The GM would operate according to the modus operandi and procedures agreed upon in harmony with those of the GM housing institution.

14. The Administrator of UNDP and the President of IFAD would meet periodically, to agree on strategies for implementing the CCD and to harmonise their support for the work of the GM. This process would involve the President of the World Bank, as appropriate.

15. At the request of the GM, the three institutions may establish ad hoc task forces to develop ideas and work on specific issues, particularly innovative resource mobilisation approaches, to help the GM entity in its work. Other organisations, including NGOs, would be associated.

16. The three institutions would advise and support the GM in developing its operational strategy, work programme and budget through the facilitation committee (referred to above).

17. The GM would report to the COP through the Head of the Housing Organisation.

18. The GM would report to the COP on its activities and would also cover, in consolidated fashion, the support it receives from the three institutions and others.

(a) Consultation and agreement on the preparation and implementation on a strategic plan for collection and collation of information and its transformation into knowledge for all stakeholders, taking into account respective institutional comparative advantage;

(b) The role of the GM in relation to the role of collaborating institutions in actual project and programme development and implementation; and

VI. Lead Institution Approach

CONFERENCE OF PLENIPOTENTIARIES ON THE
CONVENTION ON THE PRIOR INFORMED CONSENT
PROCEDURE FOR CERTAIN HAZARDOUS
CHEMICALS AND PESTICIDES IN
INTERNATIONAL TRADE

Rotterdam, 10-11 September 1998

TEXT OF THE CONVENTION ON THE PRIOR INFORMED CONSENT PROCEDURE FOR CERTAIN HAZARDOUS CHEMICALS AND PESTICIDES IN INTERNATIONAL TRADE,
AS AGREED BY THE INTERGOVERNMENTAL NEGOTIATING COMMITTEE
AT ITS FIFTH SESSION

Article 16. Technical assistance

The Parties shall, taking into account in particular the needs of developing countries and countries with economies in transition, co-operate in promoting technical assistance for the development of the infrastructure and the capacity necessary to manage chemicals to enable implementation of this Convention. Parties with more advanced programmes for regulating chemicals should provide technical assistance, including training, to other Parties in developing their infrastructure and capacity to manage chemicals throughout their life-cycle.

CONFERENCE OF PLENIPOTENTIARIES ON THE CONVENTION ON THE PRIOR INFORMED CONSENT PROCEDURE FOR CERTAIN HAZARDOUS CHEMICALS AND PESTICIDES IN INTERNATIONAL TRADE

Rotterdam, 10-11 September 1998

1. resolution on interim arrangements

The Conference,

Having adopted the text of the Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade (hereinafter referred to as the "Convention"),

Considering that interim arrangements are required to continue to operate a voluntary procedure for the application of the Prior Informed Consent (PIC) procedure in order to protect human health and the environment from certain hazardous chemicals and pesticides pending the entry into force of the Convention and to prepare for its effective operation once it enters into force,

Taking note of the existing voluntary PIC procedure established by Resolution 6/89 of the Twenty-fifth Session of the Conference of the Food and Agriculture Organisation of the United Nations (FAO) and decision 15/30 of the fifteenth session of the Governing Council of the United Nations Environment Programme (UNEP),

Recalling the decisions of the Twenty-ninth Session of the FAO Conference and the fifth special session of the UNEP Governing Council, agreeing to accept changes in the voluntary PIC procedure if so decided by the Conference of Plenipotentiaries on the Convention, provided that costs additional to the implementation of the present voluntary procedure be met through extra-budgetary resources,

I

1. Calls upon States and regional economic integration organisations entitled to do so to consider signing, ratifying, accepting, approving or acceding to the Convention with a view to bringing it into force as soon as possible;

II

2. Decides that the voluntary PIC procedure contained in the Amended London Guidelines for the Exchange of Information on Chemicals in International Trade and in the FAO International Code of Conduct on the Distribution and Use of Pesticides (hereinafter referred to as the "original PIC procedure") is hereby changed to bring it into line with the procedure established by the Convention with effect from the date on which the Convention is opened for signature. The original PIC procedure with these changes is hereinafter referred to as the "interim PIC procedure";

3. Invites the Executive Director of UNEP and the Director-General of FAO to convene such further sessions of the Intergovernmental Negotiating Committee (hereinafter referred to as the "Committee") during the period between the date on which the Convention is opened for signature and the date of the opening of the first meeting of the Conference of the Parties as are necessary to oversee the operation of the interim PIC procedure and to prepare for and service the Conference of the Parties until the end of the fiscal year in which the first meeting of the Conference of the Parties takes place;

4. Invites the Committee to establish an interim subsidiary body to discharge the functions entrusted to the subsidiary body to be established under Article 18, paragraph 6, of the Convention;

5. Invites the Intergovernmental Negotiating Committee to develop, based on the FAO regions, the decision referred to in paragraph 5 of Article 5, and to adopt this decision on an interim basis, pending its formal adoption at the first meeting of the Conference of the Parties;

6. Decides that all chemicals in respect of which Decision Guidance Documents have been circulated under the original PIC procedure before the date on which the Convention is opened for signature will be subject to the interim PIC procedure;

7. Decides that all chemicals that have been identified for inclusion in the PIC procedure under the original PIC procedure but for which Decision Guidance Documents have not yet been circulated before the date on which the Convention is opened for signature will become subject to the interim PIC procedure as soon as the relevant Decision Guidance Documents have been adopted by the Committee;

8. Decides that the Committee shall decide, between the date on which the Convention is opened for signature and the date of its entry into force, on the inclusion of any additional chemicals under the interim PIC procedure in accordance with the provisions of Articles 5, 6, 7 and 22 of the Convention;

9. Decides that nominations of designated national authorities, notifications of control actions and import responses made under the original PIC procedure shall remain in effect under the interim PIC procedure unless and until the State or regional economic integration organisation concerned notifies the Interim Secretariat in writing that it has decided otherwise;

10. Appeals to States and regional economic integration organisations to participate in and apply in full the interim PIC procedure;

11. Calls on States and regional economic integration organisations to submit notifications of final regulatory action in accordance with the provisions of Article 5 of the Convention, and calls on developing countries and countries with economies in transition that are in a position to do so to submit proposals concerning severely hazardous pesticide formulations in accordance with the provisions of Article 6 of the Convention;

12. Requests the Executive Director of UNEP and the Director-General of FAO to provide secretariat services for the operation of the interim PIC procedure;

13. Decides that the interim PIC procedure shall cease to operate on a date to be specified by the Conference of the Parties at its first meeting;

III

14. Appeals to States and regional economic integration organisations to make voluntary contributions to the trust fund established by UNEP in order to support the interim arrangements and the operation of the Conference of the Parties until the end of the fiscal year in which the first meeting of the Conference of the Parties takes place, and to ensure the full and effective participation of developing countries and countries with economies in transition in the further work of the Committee;

15. Calls on States and regional economic integration organisations with more advanced programmes for regulating chemicals to provide technical assistance, including training, to other States and regional economic integration organisations in developing their infrastructure and capacity to manage chemicals throughout their life-cycle, particularly in view of the urgent need of their participation in effective operation of the Convention once it enters into force.

-----