26 DE OUTUBRO DE 1977 _ 64-(49)

nection with its transactions, take either or both of the following steps:

i) Propose to the member that, on terms and conditions agreed between the Fund and the member, the latter lend its currency to the Fund or that, with the concurrence of the member, the Fund borrow such currency from some other source either within or outside the territories of the member, but no member shall be under any obligation to make such loans to the Fund or to concur in the borrowing of its currency by the Fund from any other source;

ii) Require the member, if it is a participant, to sell its currency to the Fund for special drawing rights held in the General Resources Account, subject to article xix, section 4. In replenishing with special drawing rights, the Fund shall pay due regard to the principles of designation under article xix, section 5.

Section 2. General scarcity of currency.

If the Fund finds that a general scarcity of a particular currency is developing, the Fund may so inform members and may issue a report setting forth the causes of the scarcity and containing recommendations designed to bring it to an end. A representative of the member whose currency is involved shall parcipate in the preparation of the report.

Section 3. Scarcity of the Fund's holdings.

a) If it becomes evident to the Fund that the demand for a member's currency seriously threatens the Fund's ability to supply that currency, the Fund, whether or not it has issued a report under section 2 of this article, shall formally declare such currency scarce and shall thenceforth apportion its existing and accruing supply of the scarce currency with due regard to the relative needs of members, the general international economic situation, and any other pertinent considerations. The Fund shall also issue a report concerning its action.

b) A formal declaration under a) above shall operate as an authorization to any member, after consultation with the Fund, temporarily to impose limitations on the freedom of exchange operations in the scarce currency. Subject to the provisions of article iv and schedule C, the member shall have complete jurisdiction in determining the nature of such limitations, but they shall be no more restrictive than is necessary to limit the demand for the scarce currency to the supply held by, or accruing to, the member in question, and they shall be relaxed and removed as rapidly as conditions permit.

c) The authorization under b) above shall expire whenever the Fund formally declares the currency in question to be no longer scarce.

Section 4. Administration of restrictions.

Any member imposing restrictions in respect of the currency of any other member pursuant to the provisions of section 3-6) of this article shall give sym-

pathetic consideration to any representations by the other member regarding the administration of such restrictions.

Section 5. Effect of other international agreements on restrictions.

Members agree not to invoke the obligations of any engagements entered into with other members prior to this Agreement in such a manner as will prevent the operation, of the provisions of this article.

ARTICLE VIII

General obligations of members

Section 1. Introduction.

In addition to the obligations assumed under other articles of this Agreement, each member undertakes the obligations set out in this article.

Section 2. Avoidance of restrictions on current payments.

a) Subject to the provisions of article vii, section 3-b) and article xiv, section 2, no member shall, without the approval of the Fund, impose restrictions on the making of payments and transfers for currant international transactions.

b) Exchange contracts which involve the currency of any member and which are contrary to the exchange control regulations of that member maintained or imposed consistently with this Agreement shall be unenforceable in the territories of any member. In addition, members may, by mutual accord, cooperate in measures for the purpose of making the exchange control regulations of dither member more effective, provided that such measures and regulations are consistent with this Agreement.

Section 3. Avoidance of discriminatory currency practices.

No member shall engage in, or permit any of its fiscal agencies referred to in article v, section ! to engage in, any discriminatory currency arrangements or multiple currency practices, whether within or outside margins under article iv or prescribed by or under schedule C, except as authorized under this Agreement or approved by the Fund. If such arrangements and practices are engaged in at the date when this Agreement eaters into force, the member concerned shall consult with the Fund as to their progressive removal unless they are maintained or imposed under article xiv, section 2, in which case the provisions of section 3 of that articls shall apply.

Section 4. Convertibility of foreign-held balances.

a) Each member shall buy balances of its currency held by another member if the latter, in requesting the purchase, represents:

i) That the balances to be bought have been recently acquired as a result of current transactions; or

if) That their conversion is needed for making payments for current transactions.