26 DE OUTU3RO DE 1977

64-(57)

ii) The allocations or cancellations shall take place at other than yearly intervals; or

ii) The basis for allocations or cancellations shall be the quotas or net cumulative allocations on dates other than the dates of decisions to allocate or cancel.

d) A member that becomes a participant after a basic period starts shall receive allocations beginning with the next basic period in which allocations are made after it becomes a participant unless the Fund decides that the new participant shall start to receive allocations beginning with the next allocation after it becomes a participant. If the Fund decides that a member that becomes a participant during a basic period shall receive allocations during the remainder of that basic period and the participant was not a member on the dates established under b) or c) above, the Fund shall determine the basis on which these allocations to the participant shall be made,

e) A participant shall receive allocations of special drawing rights made pursuant to any decision to allocate unless:

i) The Governor for the participant did not vote in favor of the decision; and

ii) The participant has notified the Fund in writing prior to the first allocation of special drawing rights under that decision that it does not wish special drawing rights to be allocated to it under the decision. On the request of a participant, the Fund may decide to terminate the effect of the notice with respect to allocations of special drawing rights subsequent to the termination.

f) If on the effective date of any cancellation the amount of special drawing rights held by a partici-panit is less than its share of the special drawing rights that are to be cancelled, the participant shall eliminate its negative balance as promptly as its gross reserve position permits and shall remains in consultation with the Fund for this purpose. Special drawing rights acquired by the participant after the effective data of the cancellation shall be applied against its negative balance and cancelled.

Section 3. Unexpected major developments.

The Fund may change the rates or intervals of allocation or cancellation during the rest of a basic period or change the length of a basic period or start a new basic period, if at any time the Fund finds it desirable to do so because of unexpected major developments.

Section 4. Decisions on allocations and cancellations.

a) Decisions under section 2-a), b), and c) or section 3 this article shall be made by the Board of Governors on the basis of proposals of the Managing Director concurred in by the Executive Board.

b) Before making any proposal, the Managing Director, after having satisfied himself that it will be consistent with the provisions of section 1-a) of this article, shall conduct such consultations as will enable him to ascertain that there is broad support among

participants for the proposal. In addition, before making a proposal for the first allocation, the Managing Director shall satisfy himself that the provisions of section \-b) of this article have been met and that there is broad support among participants to begin allocations; he shall make a proposal for the first allocation as soon after the establishment of the Special Drawing Rights Department as he is so satisfied.

c) The Managing Director shall make proposals:

0 Not later than six months before the end of each basic period;

ii) If no decision has been taken with respect to allocation or cancellation for a basic period, whenever heis satisfied that the provisions of b) above have been met;

iii) When, in accordance with section 3 of this article, he considers that it would be desirable to change the rate or intervals of allocation or cancellation or change the length of a basic period or start a new basic period; or

iv) Within six months of a request by the Board of Governors or the Executive Board;

provided that, if under i), ii), or iv) above the Managing Director ascertains that there is no proposal which he considers to be consistent with the provisions of section 1 of this article that has broad support among participants in accordance with b) above, he shall report to the Board of Governors and to the Executive Board.

d) An eighty-five percent majority of the total voting power shall be required for decisions under section 2-a), b), and c) or section 3 of this article, except for decisions under section 3 with respect to a decrease in the rates of allocation.

ARTICLE XIX Operations and transactions In special drawing rights

Section 1. Use of special drawing rights.

Special drawing rights may be used in the operations and transactions authorized by or under this Agreement.

Section 2. Operations and transactions between participants.

a) A participant may use its special drawing rights to obtain an equivalent amount of currency from a participant designated under section 5 of this article.

b) A participant, in agreement with another participant, may use its special drawing rights to obtain an equivalent amount of currency from the other participant.

c) The Fund, by a seventy percent majority of the total voting power, may prescribe operations in which a participant is authorized to engage in agreement with another participant ou such terms and conditions as the Fund deems appropriate. The terms and conditions shall be consistent with the effective functioning of the Special Drawing Righ´s Department and the proper use of special drawing rights in accordance with this Agreement.