Report Of The Fourth Meeting Of The Open-Ended Working Group

Distr.
GENERAL

UNEP/OzL.Pro.WG.IV/8
29 June 1990

ORIGINAL: ENGLISH

OPEN-ENDED WORKING GROUP OF THE
PARTIES TO THE MONTREAL PROTOCOL

Fourth meeting London, 20-29 June 1990

REPORT OF THE FOURTH MEETING OF THE OPEN-ENDED
WORKING GROUP OF THE PARTIES TO THE
MONTREAL PROTOCOL

I. INTRODUCTION

1. The fourth meeting of the Open-Ended Working Group of the Parties to the Montreal Protocol was held at the headquarters of the International Maritime organization, in London, from 20 to 29 June 1990, to further develop modalities for financial and other mechanisms to enable developing countries to meet the requirements of the Montreal Protocol, in accordance with decisions 5 and 13 of the First Meeting of the Parties to the Montreal Protocol, held in Helsinki from 2 to 5 May 1989, and to consider further the proposals for adjustments and amendments of the Montreal Protocol which were submitted to the Parties in accordance with Articles 9 and 10 of the Vienna Convention and Article 2, paragraph 9, of the Montreal Protocol.

II. ORGANIZATIONAL MATTERS

A. Opening of the meeting

2. The Chairman for part 1 of the meeting declared open the fourth meeting of the Open-Ended Working Group in the morning of Wednesday, 20 June 1990.

3. The Right Honourable Chris Patten, Secretary of State for the Environment of the United Kingdom, welcomed the participants and stressed the importance of the issues before the meeting. He said that the latest scientific evidence showed that the ozone layer had suffered considerable damage because of the emissions of CFCs and halons and that it would take many years to achieve the goal of restoring the ozone layer. He noted that difficult issues such as technology transfer and financial mechanisms would have to be resolved to accommodate the legitimate wishes of the developing countries. He thanked the UNEPsecretariat, and its Executive Director in particular, for their efforts and wished the Working Group every success in its negotiations.

4. The Executive Director of the United Nations Environment Programme thanked the Secretary of State and the United Kingdom Government for hosting the meeting. He reported that on the basis of informal consultations on adjustments and amendments to the Protocol, held on 18-19 June 1990, and attended by a representative group of countries, he had prepared a revised note(UNEP/Ozl.Pro.WG.IV/2/Rev.1) which contained a set of proposed adjustments and amendments, including complete phase-out of CFCs and halons, the inclusion and complete phase-out of carbon tetrachloride, the inclusion and phase-down of methyl chloroform with a commitment to a total phase-out, and a strong signal to industry to search for substitutes other than HCFCs. He also stated that progress must be made on the financial mechanisms to be devised to co-operate with developing countries and on the transfer of technology to those countries.

B.Attendance

5. The meeting was attended by delegations from the following Contracting Parties: Australia, Austria, Belgium, Brazil, Byelorussian SSR, Cameroon, Canada, Chile, Denmark, Egypt, European Economic Community, Finland, France, German Democratic Republic, Federal Republic of Germany, Ghana, Greece, Guatemala, Hungary, Iceland, Ireland, Italy, Japan, Jordan, Kenya, Luxembourg, Malaysia, Maldives, Malta, Mexico, the Netherlands, New Zealand, Nigeria, Norway, Portugal, Singapore, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Thailand, Trinidad and Tobago, Tunisia, Uganda, Ukrainian SSR, Union of Soviet Socialist Republics, United Kingdom, United States of America, Venezuela and Zambia.

6. The meeting was also attended by delegations from the following States not party to the Protocol: Antigua and Barbuda, Argentina, Bangladesh, Botswana, Brunei Darussalam, Bulgaria, Burundi, China, Colombia, Congo, Czechoslovakia, Dominica, Ecuador, India, Kuwait, Malawi, Morocco, Peru, Philippines, Poland, Republic of Korea, Saudi Arabia, Senegal, Somalia, Swaziland, Togo, Turkey, Uruguay, Yugoslavia, Zaire and Zimbabwe.

7. Observers from the following United Nations bodies and specialized agencies were also present: United Nations Office of Legal Affairs, United Nations Development Programme (UNDP), International Maritime organization (IMO), United Nations Industrial Development Organization (UNIDO), World Bank and the World Meteorological Organization (WMO).

8. The following other organizations were represented: AFCAM - Australia, Australian Conservation Foundation, Brazilian Association of Electrical and Electronic Industries (ABINEE), Conference of European Churches, Du Pont International SA, Environmental and Energy Study Institute, European Council of Chemical Manufacturers' Federations (CEFIC), Federation of European Aerosol Associations (FEA), Friends of the Earth International, Greenpeace International, Halogenated Solvents Industry Alliance, ICOLS, Industrial Technology Research Institute (ITRI), Institute for Studies in Environmental Law (ISEL), International Chamber of Commerce (ICC), International Institute for Environment and Development (IIED), International Institute of Refrigeration, Japan Association for Hygiene of Chlorinated Sovents (JAHCS), Japan Electrical Manufacturers Association (JEMA), Japan Flon Gas Association, Motor Vehicle Manufacturers Association (United States) (MVKA), Natural Resources Defense Council, Pharmaceutical Aerosol CFC Coalition, Refrigeration

Industry Board (RIB), Soci6t6 ECIA, SRF Ltd., (formerly Sbri Ram Fibres), Stockholm Environment Institute, Ulsan Chemical Co. Ltd., Worldwatch, World Wide Fund for Nature International (WWF) and Ziegler and Associates.

C. Election of officers and adoption of the agenda

9. In accordance with the decision of the first session of the first meeting of the Open-Ended Working Group, the following Bureau elected at that session remained in office for part I of the meeting, which dealt with the financial mechanism:

Chairman: H.E. Mr. Ilkka Ristimaki (Finland)

Vice-Chairmen: Mr. Yuji Ikeda (Japan) Mr. Clement Dorim-Adzobu (Ghana)

Rapporteur: Mr. Nicholas Christoforides (EEC)

10. For part II of the meeting, which dealt with adjustments and amendments, the following Bureau remained in office:

Chairman: Mr. Victor Buxton (Canada)

Vice-Chairmen: Mo. Eileen Claussen (United States of America) Mr. Sergei Stepanov (Union of Soviet Socialist Republics)

Rapporteur: Mo. Keziah Kinyanjui (Kenya)

11. The meeting adopted the following agenda, as contained in document UNEP/OzL.Pro.WG.IV/1/Rev.l:

1. opening of the meeting.

2. Adoption of part I of the agenda.

3. Financial mechanisms:

(a) Total cost of assistance to developing countries;

(b) Institutional arrangements for the financial mechanism;

(c) Transfer of technology;

(d) Draft decision on financial mechanisms;

(e) Proposed amendments to Articles 5, 10 and 10 bis of the Montreal Protocol.

4. other matters.

5. Adoption of the report for part I.

6. Adoption of part II of the agenda.

7. Notes by the Executive Director (UNEP/OzL.Pro.WG.IV/2 and 4).

8. Consideration of the proposals for adjustments and amendments as contained in UNEP/OzL.Pro.WG.III(1)/3):

(a) Preambular paragraphs;

(b) Article 1 (Definitions);

(c) Article 2 (Control measures);

(d) Article 3 (Calculation of control levels);

(e) Article 4 (Control of trade with non-Parties);

(f) Article 5 (Special situation of developing countries);

(g) Article 7 (Reporting of data);

(h) Article 8 (Non-eompliance);

(i) Article 10 (Technical assistance);

(j) Article 10 bis (Transfer of technology and financial assistance);

(k) Article 19 (Withdrawal);

(l) Annexes.

9. other matters.

10. Adoption of the report for part II.

11. Closure of the meeting.

12. The Working Group agreed to switch, if necessary, between item of part I and part II of the agenda.

III. SUBSTANTIVE MATTERS

A. Part of the meeting

13. At the invitation of the Chairman, the countries studies for China, Egypt, Kenya and Mexico were presented on the use of CFCs and other ozone-depleting substances and strategies for the reduction of their use. The preliminary estimates indicated that the costs of achieving significant reductions in China may be of the order of some $42 million over the three-year period 1991-1993, whereas a total phase-out of CFCs in Egypt over the next 20 years would cost an estimated $30-38 million. The preliminary

study of CFC reduction in Kenya indicated estimated extra costs of $275,000 from 1990 to 1993, and around $1.1-1.5 million totally over the ten year period 1990/2000. The Mexican study estimated a range of additional costs in the range of $64-119 million up to the year 2010 for the reduction of ozone depleting substances; it also estimated that a 50 per cent reduction in the use of halons might be achieved at zero not cost.

14. The Chairman introduced discussion of proposals for texts of articles on technical co-operation, the financial mechanism and transfer of technology. After extensive discussion and a review by the Legal Drafting Group, the Working Group adopted the text of the proposed amendment on the financial mechanism, as contained in Annex II to the present report as Article 10 of the draft Amendment to the Protocol. On the issue of transfer of technology, the Working Group received, during Its discussion, documents UNEP/OzL.Pro.WG.IV/7/Rev.1, 2 and 5, submitted by the Executive Director. Several delegations presented their views on the subject. Delegations from several developing countries expressed that the provisions on the transfer of technology and financial co-operation were vital to their countries and unless these two issues were satisfactorily resolved they would not be prepared to accept the proposed control measures. A drafting group was established to consider this question but for various reasons was unable to complete its work.

15. Several delegations requested information from the World Bank, UNDP and UNEP on the tripartite arrangement and its functioning. The representative of the World Bank, referring to the statement made by the Bank at the second session of the third meeting of the Working Group (UffEP/OzL.Pro.WG.III(2)/3, para. 20), described the common view of the World Bank, UNDP and UNEP that had emerged on the tripartite operation of the Multilateral Fund. He indicated that the World Bank with UNEP and the UNDP could develop work programmes, in conjunction with other multilateral and bilateral agencies, to be reviewed and revised by the Contracting Parties, and then implemented in a cost-effective manner by the institution responsible. He added that the Implementation of agreed country-speeific programmes would be handled through the countries' own institutions, working with the co-operation of the agencies in the tripartite operation.

16. The Executive Director introduced his proposal for a decision of the Parties on the financial mechanism for the implementation of the Protocol (UNEP/OzL.Pro.IV/6) and his reports on the financial implications and the adoption of a revised budget for the Ozone Secretariat and a budget for the Fund Secretariat (UNEP/OzL.Pro.2/2/Add.5, its corrigenda and UNEP/OzL.Pro.2/2/Add.3).

17. The Working Group expressed concern at the rate at which contributions were being paid into the Protocol Trust Fund and the consequent difficulty of financing the proposed revised 1990 budget. Several delegations noted their recent financial contributions toward the 1990 Ozone Secretariat budget, and their contributions in kind, in addition to those set out in document UNEP/OzL.Pro.2/2/Add.3. Several delegations also expressed the view that, in future, contributions in kind to the budget should count as part of the assessed contributions. One delegation considered that budgets should be submitted in a careful and timely manner, that preliminary financial expert consideration should be given to present and future proposed budgets, and that

growth in expenditure should not be on account of bureaucratic expenditure, in particular the creation of new posts. With regard to the revised 1990 budget, several delegations sought clarification on the source of funds received additional to the assessed country contribution and on the amount committed for the remainder of the financial year. In consideration of the proposed budget for 1991-1992, several delegations asked that explanation of the additional posts and Working Group meetings should be given in presenting the budget to the Parties.

18. With regard to the proposed budget for the Fund Secretariat, several delegations expressed the view that its consideration should lie in the first instance with the proposed Executive Committee of the Multilateral Fund. other delegations considered that since final approval of budgets rested with the Meeting of the Parties and there was an urgent need for the funding mechanism to start operating as soon as possible in 1991, the Second Meeting of the Parties should be asked to authorize the proposed budget on an interim basis, subject to review by the Executive Committee and confirmation by the Third Meeting of the Parties, taking into account the recommendation of the Executive Committee.

19. The Working Group sought and obtained clarifications on the Executive Director's report on the financial implications and the update on activities from April to June 1990, which reflected recent contributions by several Parties. It recommended the Ozone Secretariat budgets, as revised for 1990 and proposed for the biennium 1991-1992, for consideration of the Second Meeting of the Parties. It noted and passed on the proposed budget for the Fund Secretariat for the consideration and possible adoption by the Second Meeting of the Parties.

20. The Working Group considered the proposed decision on the financial mechanism, along with its appendices on the proposed terms of reference for the Executive Committee and for the interim Multilateral Fund for the implementation of the Protocol. It was noted that the text of the decision proposed should reflect as far as possible the text of the proposed article on the financial mechanism. After some discussion, the Working Group adopted the proposed decision and Its appendices, as contained, respectively in Annexes IV and V to the present report, to be presented to the Second Meeting of the Parties. The Working Group was presented with two proposals for inclusion in the draft decisions to be submitted for the consideration of the Meeting of the Parties. However, the Working Group did not find Itself in a position to discuss the proposals and transferred them to the Meeting of the Parties without further consideration.

B. Part II of the meeting

21. Some delegations described the results of the recent ozone layer research. A preliminary study of the observations from Macquarie island and some other southern hemisphere stations suggested a rate of depletion in the mid-latitude ridge in excess of that foreshadowed by models. One delegation also pointed out that there is some indication of increasing solar UV-B radiation flux in alpine regions. A member of the Scientific Assessment Panel presented the latest scientific evidence on the extent of damage to the ozone layer which indicated the urgent need to make further reductions in emissions of ozone-depleting substances.

22. The Chairman then proceeded to review the proposals for adjustments and amendments, as contained in the report of the Working Group on the first session of its third meeting (UNEP/OzL.Pro.WG.III(1)/3), considering also the proposals contained in the notes by the Executive Director (UNEP/OzL.Pro.WG.IV/2 and Rev.1 and UNEP/OzL.Pro.WG.IV/3), with the aim of reducing, to the degree possible, the number of square brackets in the composite negotiating text.

23. The Working Group considered all the proposals for adjustments and amendments. Some delegations noted that their agreement to the proposals adopted at the meeting would be subject to a satisfactory outcome of the discussions on financial mechanism. Another delegation noted that agreement in this context to certain financial arrangements reflected the scientific basis for concern regarding the ozone layer, the predictability of the magnitude, of the funds involved, and the expected contribution of such funds to addressing the problem of ozone depletion, and such agreement did not, in its view constitute a precedent for other international negotiations.

24. In the discussion on proposed adjustments to Article 2 of the Protocol, several delegations proposed that a CFC phase-out should be achieved before 2000. Several other delegations noted that, under the Protocol, Parties were able, and should be encouraged, independently to take more stringent control measures than those specified. The Working Group could not agree on the dates and percentages for further reductions of CFCs and concluded that two proposals on the subject should be left for the consideration of the Second Meeting of the Parties. Two proposals for the reduction in methyl chloroform from 2000, and two proposals for the first control date for carbon tetrachloride were similarly deferred.

25. With regard to entry into force of the proposed Amendment to the Protocol, one delegation noted that as the Amendment should be adopted in accordance with the relevant provisions of the Vienna Convention for the Protection of the Ozone Layer, its entry into force should also, for consistency, be subject to the provisions of that Convention. It indicated, however, that, in order to allay any concerns about possible delays that might arise, it could join in the consensus to deviate from the Vienna Convention provisions and to agree on the number of ratifications required for entry into force. It emphasized that the importance of observing procedure should not be taken lightheartedly in current and future work.

26. The Working Group considered the decisions proposed for consideration by the Second Meeting of the Parties. One delegation sought clarification about the legal implications of having two instruments, a decision and an amendment, on the inclusion of isomers within the Protocol. One delegation expressed concern at the possibility that, through decision, criteria might be adopted to increase the scope of definitions set out in Article 1 of the Protocol.

27. It was noted that the Working Group did not have a formal mandate to consider the report of the Ad Hoe Working Group of Legal Experts on Non-Compliance, which would be presented to the Second Meeting of the Parties.

28. In the discussion on the proposed future work of the Technology Review Panel, many delegations noted that developing countries should be adequately represented to ensure that the Panel identified in an appropriate manner the technological and technical needs of such countries. Several delegations noted the need for the Technology Review Panel to give particular attention to substitutes and alternatives for methyl chloroform and, for some of those delegations, for HCFCs. In this regard, some delegations noted the need to clarify the proposed work of the Panel in relation to the formal assessment and review procedure under Article 6 of the Protocol.

29. The Working Group referred the revised composite negotiating text of adjustments, amendments and decisions to the Legal Drafting Group for updating. The Working Group subsequently adopted this composite negotiating text as set out in annexes I to IV of the present report to be presented to the Second Meeting of the Parties.

30. The Working Group expressed its gratitude for the extensive assistance of the Legal Drafting Group.

IV. ADOPTION OF THE REPORT

31. The Working Group adopted the present report together with its annexes.

V. CLOSURE OF THE MEETING

32. Following the customary exchange of courtesies, the Chairman declared the meeting closed at 1.30 a.m. on Friday, 29 June 1990.

DRAFT ADJUSTMENTS TO THE MONTREAL PROTOCOL ON SUBSTANCES THAT DEPLETE THE OZONE LAYER*

The Second Meeting of the Parties to the Montreal Protocol on Substances that Deplete the ozone Layer decides, on the basis of assessments made pursuant to Article 6 of the Protocol, to adopt adjustments and reductions of production and consumption of the controlled substances in Annex A to the Protocol, as follows, with the understanding that:

(a) References in Article 2 to "this Article" and throughout the Protocol to "Article 2" shall be interpreted as references to Articles 2, 2A and 2B;

(b) References throughout the Protocol to "paragraphs 1 to 4 of Article 2" shall be interpreted as references to Articles 2A and 2B; and

(c) The reference in paragraph 5 of Article 2 to "paragraphs 1, 3 and 4'. shall be interpreted as a reference to Article 2A.

A. Article 2A: CFCs

Paragraph 1 of Article 2 of the Protocol shall become paragraph 1 of Article 2A, which shall be entitled "Article 2A: CFCs". Paragraphs 3 and 4 of Article 2 shall be replaced by the following paragraphs, which shall be numbered paragraphs 2 to 6 of Article 2A:

2. Each Party shall ensure that for the period from 1 July 1991 to 31 December 1992 its calculated levels of consumption and production of the controlled substances in Grou I of Annex A do not exceed 150 per cent of its calculated levels of production and consumption of those substances in 1986;

3.Each Party shall ensure that for the twelve-month period commencing on1 January 1993, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex A does not exceed, annually, [eighty] [fifty] per cent of its calculated level of consumption in 1986. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, fifty per cent of its calculated level of production in 1986.

This text would be appended to the decision adopted by the Meeting of the Contracting Parties.

However, in order to satisfy the basic domestic needs of the Parties operating under paragraph I of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1986.

4. Each Party shall ensure that for the twelve-month period commencing on 1 January [19951 [19971, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex A does not exceed, annually, fifteen per cent of its calculated level of consumption in 1986. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, fifteen per cent of its calculated level of production in 1986. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1986.

5. Each Party shall ensure that for the twelve-month period commencing on 1 January 119971 120001, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex A does not exceed zero. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed zero. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to fifteen per cent of its calculated level of production in 1986.

B. Article 2B: Halons

Paragraph 2 of Article 2 of the Protocol shall be replaced by the following paragraphs, which shall be numbered paragraphs 1 to 4 of Article 2B:

1.Each Party shall ensure that for the twelve-month period commencing on 1January 1992, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex A does not exceed, annually, Its calculated level of consumption in 1986. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, its calculated level of production in 1986. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1986.

2.Each Party shall ensure that for the twelve-month period commencing on 1 January 1995, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex A does not exceed, annually, fifty per cent of Its calculated level of consumption in 1986. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, fifty per cent

of its calculated level of production in 1986. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1986. This paragraph will apply save to the extent that the Parties decide to permit the level of production or consumption that is necessary to satisfy essential uses for which no adequate alternatives are available.

3. Each Party shall ensure that for the twelve-month period commencing on 1 January 2000, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex A does not exceed zero. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed zero. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to fifteen per cent of its calculated level of production in 1986. This paragraph will apply save to the extent that the Parties decide to permit the level of production or consumption that is necessary to satisfy essential uses for which no adequate alternatives are available.

4.By 1 January 1993, the Parties shall adopt a decision identifying essential uses, if any, for the purposes of paragraphs 2 and 3 of this Article. Such decision shall be reviewed by the Parties at their subsequent meetings.

DRAFT AN M KENT TO THE MONTREAL PROTOCOL ON SUBSTANCES THAT DEPLETE THE OZONE LAYER*

ARTICLE 1: AMENDMENT

A. Preanbular paragraphs

1. The 6th preambular paragraph of the Protocol shall be replaced by the following

Determined to protect the ozone layer by taking precautionary measures to control equitably total global emissions of substances that deplete it, with the ultimate objective of their elimination on the basis of developments in scientific knowledge, taking into account technical and economic considerations and bearing in mind the developmental needs of developing countries,

2. The 7th preambular paragraph of the Protocol shall be replaced by the following

[Acknowledging that special provision is required to meet the needs of developing countries for these substances, [including the provision of new and additional (adequate) financial resources and access to relevant technologies,])

[Acknowledging that special provision is required to meet the needs of developing countries, including through the provision of additional financial resources and access to relevant technologies, bearing in mind that the contribution of controlled substances to ozone depletion and the potential harmful effects of such depletion are scientifically well-documented, the magnitude of funds necessary is reasonably predictable, and the funds can be expected to make a substantial difference in the world's ability to address the problem of ozone depletion,]

3. The 9th preambular paragraph of the Protocol shall be replaced by the followin

Considering the importance of promoting international co-operation In the research, development and transfer of alternative technologies relating to the control and reduction of emissions of substances that deplete the ozone layer, bearing in mind in particular the needs of developing countries,

This text would be appended to the decision adopted by the Meeting of the Parties.

B. Article 1: Definitions

1. Paragraph 4 of Article 1 of the Protocol shall be replaced by the following paragraph:

"Controlled substance" means a substance in Annex A or in Annex B to this Protocol, whether existing alone or in a mixture. It includes the isomers of any such substance, except as specified in the relevant Annex, but excludes any controlled substance or mixture which is in a manufactured product other than a container used for the transportation or storage of that substance.

2. Paragraph 5 of Article 1 of the Protocol shall be replaced by the following paragraph:

"Production" means the amount of controlled substances produced, minus the amount destroyed by technologies to be approved by the Parties and minus the amount entirely used as feedstock in the manufacture of other chemicals. The amount recycled and reused is not to be considered as "production".

3. The following paragraph shall be added to Article 1 of the Protocol:

9. "Transitional substance" means a substance in Annex C to this Protocol, whether existing alone or in a mixture. It includes the isomers of any such substance, except as may be specified in Annex C, but excludes any transitional substance or mixture which is in a manufactured product other than a container used for the transportation or storage of that substance.

C. Article 2. paragraph 5

Paragraph 5 of Article 2 of the Protocol shall be replaced by the following paragraph:

15. Any Party may, for any one or more control periods, transfer to another Party any portion of its calculated level of production set out in Articles 2A to 29, provided that the total combined calculated levels of production of the Parties concerned for any group of controlled substances do not exceed the production limits set out in those Articles for that group. Such transfer of production shall be notified to the Secretariat by each of the Parties concerned, stating the terms of such transfer and the period for Which it is to apply.]

D. Article 2. parazraph 6

The following words shall be inserted in paragraph 6 of Article 2 before the words "controlled substances" the first time they occur:

Annex A or Annex B

E. Article 2. paragraph 8 (a)

The following words shall be added after the words "this Article" wherever they appear in paragraph 8 (a) of Article 2 of the Protocol: and Articles 2A to 2E

F. Article 2. paragraph 9 (a) (I.)

The following words shall be added after "Annex A" in paragraph 9 (a) (i) of Article 2 of the Protocol: and/or Annex B

G. Article 2. paragraph 9 (a) (ii)

The following words shall be deleted from paragraph 9 (a) (ii) of Article 2 of the Protocol: from 1986 levels

H. Article 2. paragraph 9 (c)

The following words shall be deleted from paragraph 9 (e) of Article 2 of the Protocol:

representing at least fifty per cent of the total consumption of the controlled substances of the Parties and replaced by:

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

I. Article 2. paragraph 10 (b)

Paragraph 10 (b) of Article 2 of the Protocol shall be deleted, and paragraph 10 (a) of Article 2 shall become paragraph 10. J. Article 2. paragraph 11

The following words shall be added after the words "this Article" wherever they occur in paragraph 11 of Article 2 of the Protocol: and Articles 2A to 2E

/ ...

K. Article 2C: Other fully halogenated CFCs

The following paragraphs shall be added to the Protocol as Article 2C:

1. Each Party shall ensure that for the twelve-month period commencing on 1 January 1993, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex B does not exceed, annually, eighty per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, eighty per cent of its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.

2. Each Party shall ensure that for the twelve-month period commencing on 1 January 1997, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex B does not exceed, annually, fifteen per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, fifteen per cent of its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.

3. Each Party shall ensure that for the twelve-month period commencing on 1 January 2000, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group I of Annex B does not exceed zero. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed zero. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to fifteen per cent of its calculated level of production in 1989.

L. Article 2D: Carbon tetrachloride

The following paragraphs shall be added to the Protocol as Article 2D:

11. Each Party shall ensure that for the twelve-month period commencing on 1 January 1993, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex B does not exceed, annually, its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph I of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.1

(1.) Each Party shall ensure that for the twelve-month period commencing on I January 1993, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex B does not exceed, annually, fifty per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, fifty per cent of its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph I of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.1

2. Each Party shall ensure that for the twelve-month period commencing on 1 January 1995, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group 11 of Annex B does not exceed, annually, fifteen per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that Its calculated level of production of the substances does not exceed, annually, fifteen per cent of its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to fifteen per cent of its calculated level of production in 1989.

3. Each Party shall ensure that for the twelve-month period commencing on 1 January 2000, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group II of Annex B does not exceed zero. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed zero. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to fifteen per cent of its calculated level of production in 1989.

M. Article 2E: 1.1.1-trichloroethane (methyl chloroform)

The following paragraphs shall be added to the Protocol as Article 2E:

1. Each Party shall ensure that for the twelve-month period commencing on 1 January 1993, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group III of Annex B does not exceed, annually, its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of the substances does not exceed, annually, its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to tan per cent of its calculated level of production in 1989.

2. Each Party shall ensure that for the twelve-month period commencing on 1 January 1995, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group III of Annex B does not exceed, annually, seventy per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of these substances does not exceed, annually, seventy per cent of its calculated level of consumption in 1989. However, in order to satisfy the basic domestic needs of the Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.

3. Each Party shall ensure that for the twelve-month period commencing on 1 January 2000, and in each twelve-month period thereafter, its calculated level of consumption of the controlled substances in Group III of Annex B does not exceed, annually, [fifty] [fifteen] per cent of its calculated level of consumption in 1989. Each Party producing one or more of these substances shall, for the same periods, ensure that its calculated level of production of these substances does not exceed, annually, (fifty] [fifteen] per cent of its calculated level of production in 1989. However, in order to satisfy the basic domestic needs of Parties operating under paragraph 1 of Article 5, its calculated level of production may exceed that limit by up to ten per cent of its calculated level of production in 1989.

N. Article 3: Calculation of control levels

1. The following shall be added after "Articles 2" in Article 3 of the Protocol:

, 2A to 2E,

2. The following words shall be added after "Annex A" each time It appears in Article 3 of the Protocol:

or Annex B

0. Article 4: Control of trade with non-Parties

1. Paragraphs 1 to 4 of Article 4 shall be replaced by the following paragraphs:

1. As of 1 January 1990, each Party shall ban the import of the controlled substances in Annex A from any State not party to this Protocol.

1 bis. Within one year of the date of the entry into force of this paragraph, each Party shall ban the import of the controlled substances in Annex B from any State not party to this Protocol.

2. As of 1 January 1993, each Party shall ban the export of any controlled substances in Annex A to any State not party to this Protocol.

2 bis. Commencing one year after the date of entry into force of this paragraph, each Party shall ban the export of any controlled substances in Annex B to any State not party to this Protocol.

3. By 1 January 1992, the Parties shall, following the procedures in Article 10 of the Convention, elaborate in an annex a list of products containing controlled substances in Annex A. Parties that have not objected to the annex in accordance with those procedures shall ban, within one year of the annex having became effective, the import of those products from any State not party to this Protocol.

3 bis. Within three years of the date of the entry into force of this paragraph, the Parties shall, following the procedures in Article 10 of the Convention, elaborate in an annex a list of products containing controlled substances in Annex B. Parties that have not objected to the annex in accordance with those procedures shall ban, within one year of the annex having become effective, the import of those products from any State not party to this Protocol.

4. By 1 January 1994, the Parties shall determine the feasibility of banning or restricting, from States not party to this Protocol, the import of products produced with, but not containing, controlled substances in Annex A. If determined feasible, the Parties shall, following the procedures in Article 10 of the Convention, elaborate in an annex a list of such products. Parties that have not objected to the annex in accordance with those procedures shall ban, within one year of the annex having become effective, the import of those products from any State not party to this Protocol.

4 bis. Within five years of the date of the entry into force of this paragraph, the Parties shall determine the feasibility of banning or restricting, from States not party to this Protocol, the import of products produced with, but not containing, controlled substances in Annex B. If determined feasible, the Parties shall, following the procedures in Article 10 of the Convention, elaborate in an annex a list of such products. Parties that have not objected to the annex in accordance with those procedures shall ban or restrict, within one year of the annex having become effective, the import of those products from any State not party to this Protocol.

2. Paragraph 5 of Article 4 of the Protocol shall be replaced by the following paragraph:

5. Each Party undertakes to the fullest practicable extent to discourage the export to any State not party to this Protocol of technology for producing and for utilizing controlled substances.

3. Paragraph 8 of Article 4 of the Protocol shall be replaced by the following paragraph:

8. Notwithstanding the provisions of this Article, imports referred to in paragraphs 1, 1 b1s, 3, 3 bis, 4 and 4 bis, and exports referred to in paragraphs 2 and 2 bis, may be permitted from, or to, any State not party to this Protocol, if that State is determined by a meeting of the Parties to be in full compliance with Article 2, Articles 2A to 2E, and this Article and have submitted data to that effect as specified in Article 7.

/ ...

4. The following paragraph shall be added to Article 4 of the Protocol as paragraph 9:

9. For the purposes of this Article,~ the term "State not party to this Protocol" shall include, with respect to a particular controlled substance, a State or regional economic integration organization that has not agreed to be bound by the control measures in effect for that substance.

P. Article 5: Special situation of developing countries

1. Article 5 of the Protocol shall be replaced by the following paragraphs:

[1. Any Party that is a developing country and whose annual calculated level of consumption of the controlled substances in Annex A is less than 0.3 kilograms per capita on the date of the entry into force of the Protocol for it, or any time thereafter until I January 1999, shall, in order to meet its basic domestic needs, be entitled to delay for ten years its compliance with the control measures set out in Articles 2A to 2E.]

2. However, any Party operating under paragraph 1 of this Article shall not exceed an annual calculated level of consumption of the controlled substances in Annex A of 0.3 kilograms per capita or an annual calculated level of consumption of the controlled substances of Annex B of 0.2 kilograms per capita.

3. When implementing the control measures set out in Articles 2A to 2E, any Party operating under paragraph 1 of this Article shall be entitled to use:

(a) For controlled substances under Annex A, either the average of its annual calculated level of consumption for the period 1995 to 1997 inclusive or a calculated level of consumption of 0.3 kilograms per capita, whichever is the lower, as the basis for determining its compliance with the control measures;

(b) For controlled substances under Annex B, the average of its annual calculated level of consumption for the period 1998 to 2000 inclusive or a calculated level of consumption of 0.2 kilograms per capita, whichever is the lower, as the basis for determining its compliance with the control measures.

14. The obligation of the Parties operating under paragraph 1 of Article 5 to comply with the schedule of the control measures set out in Articles 2A to 2E will be subject to the transfer of technologies and financial assistance as provided by Article 10 5. A meeting of the Parties shall review in 1999 the situation of Parties operating under paragraph I of Article 5 and shall adopt such further provisions regarding the schedule for the reduction of consumption of control measures set out in paragraphs 1 to 4 of Article 2, as are feasible and necessary to meet the objectives of the Protocol, taking into account the progress of research and development of substitutes, the technology for using such substitutes and availability of such substances and technologies to developing countries.]

Q. Article 6: Assessment and review of control measures

The following words shall be added after "Article 2" in Article 6 of the Protocol:

Articles 2A to 2E, and the situation regarding production, imports and exports of the transitional substances in Group I of Annex C

R. Article 7: Reporting of data

1. Article 7 of the Protocol shall be replaced by the following paragraphs:

1. Each Party shall provide to the Secretariat, within three months of becoming a Party, statistical data on its production, imports and exports of each of the controlled substances in Annex A for the year 1986, or the best possible estimates of such data where actual data are not available.

2. Each Party shall provide to the Secretariat statistical data on its production, imports and exports of each of the controlled substances in Annex B and each of the transitional substances in Group I of Annex C, for the year 1989, or the best possible estimates of such data where actual data are not available, not later than three months after the date when the provisions set out in the Protocol with regard to the substances in Annex B enter into force for that Party.

3. Each Party shall provide statistical data to the Secretariat on its annual production (as defined in paragraph 5 of Article 1), and, separately,

- amounts used for feedstocks,

- amounts destroyed by technologies approved by the Parties,

- imports and exports to Parties and non-Parties respectively, of each of the controlled substances listed in Annexes A and B as well as of the transitional substances in Group I of Annex C, for the year during which provisions concerning the substances in Annex B entered into force for that Party and for each year thereafter. Data shall be forwarded not later than nine months after the end of the year to which the data relate.

2. The following paragraph shall be added to Article 7 of the Protocol:

[4. For Parties operating under the provisions of paragraph 8 (a) of Article 2, the requirements in paragraphs 1, 2 and 3 of this Article in respect of statistical data on imports and exports shall be satisfied if the regional economic integration organization concerned provides data on imports and exports between the organization and States that are not members of that organization.]

S. Article 9: Research, development, public awareness and exchanze of information

Paragraph 1 (a) of Article 9 of the Protocol shall be replaced by the following:

(a) Beat technologies for improving the containment, recovery, recycling, or destruction of controlled and transitional substances or otherwise reducing their emissions;

T. Article 10: Financial mechanism

Article 10 of the Protocol shall be replaced by the following paragraphs:

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 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:

(i) Assist Parties operating under paragraph 1 of Article 5, through country specific studies and other technical co-operation, to identify their needs for co-operation;

(ii) Facilitate technical co-operation to meet these identified needs;

(iii) Distribute, as provided for in Article 9, information and relevant materials, and hold workshops, training sessions, and other related activities, for the benefit of Parties that are developing countries; and

(iv) Facilitate and monitor other multilateral, regional and bilateral co-operation available to Parties that are developing countries;

(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)

[the level of consumption of the controlled substances In 1986). 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

o 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) Masts 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 concurrent* 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 tb* Parties not so operating present and voting.

10. The financial mechanism set out in this Article is without prejudice to any future arrangements that may be developed with respect to other environmental issues.

U. Article 11: Meetings of the Parties

Paragraph 4 (g) of Article 11 of the Protocol shall be replaced by the following:

(g) Assess, in accordance with Article 6, the control measures and the situation regarding transitional substances;

V. Article 17: Parties Joininz after entEX into force

The following words shall be added after "as wall as under" in Article 17:

Articles 2A to 29, and

W. Article 19: Withdrawal

Article 19 of the Protocol shall be replaced by the following paragraph:

Any Party may withdraw from this Protocol by giving written notification to the Depositary at any time after four years of assuming the obligations specified in paragraph 1 of Article 2A. Any such withdrawal shall take effect upon expiry of one year after the date of its receipt by the Depositary, or on such later date as may be specified in the notification of the withdrawal.

X. Annexes

The following annexes shall be added to the Protocol:

Group Substance Ozone-depleting Potential Group I CF3Cl (CFC-13) 1.0 C2FC15 (CFC-111) 1.0 C2F2C14 (CFC-112) 1.0 C3FC17 (CFC-211) 1.0 C3F2C16 (CFC-212) 1.0 C3F3Cl5 (CFC-213) 1.0 C3F4C14 (CFC-214) 1.0 C3F5CI3 (CFC-215) 1.0 C3F6C12 (CFC-216) 1.0 C3F7Cl (CFC-217) 1.0

CC14 carbon tetrachloride 1.1

C2H3Cl3* 1,1,1-trichloroethane 0.1 (methyl chloroform)

This formula does not refer to 1,1,2-trichloroethane. Annex C

Group Substance

CHFC12 (HCFC-21) CHF2C1 (HCFC-22) CH2FC1 (HCFC-31) C2HFC14 (HCFC-121) C2HF2Cl3 (HCFC-122) C2HF3CI2 (HCFC-123) C2HF4CI (HCFC-124) C2H2FC13 (HCFC-131) C2H2F2Cl2 (HCFC-132) C2H2F3Cl (HCFC-133) C2H3FC12 (HCFC-141) C2H3F2Cl (HCFC-142) C2H4FC1 (HCFC-151) C3HFC16 (HCFC-221) C3HF2Cl5 (HCFC-222) C3HF3Cl4 (HCFC-223) C3HF4Cl3 (HCFC-224) C3HF5Cl2 (HCFC-225) C3HF6Cl (HCFC-226) C3H2FC15 (HCFC-231) C3H2F2Cl4 (HCFC-232) C3H2F3Cl3 (HCFC-233) C3H2F4Cl2 (HCFC-234) C3H2F5Cl (HCFC-235) C3H3FC14 (HCFC-241) C3H3F2Cl3 (HCFC-242) C3H3F3Cl2 (HCFC-243) C3H3F4Cl (HCFC-244) C3H4FC13 (HCFC-251) C3H4F2Cl2 (HCFC-252) C3H4F3Cl (HCFC-253) C3H5FC12 (HCFC-261) C3H5F2Cl (HCFC-262) C3H6FC1 (HCFC-271)

/ ...

Group Substance Ozone-deyletinz potential Group I CF3Cl (CFC-13) 1.0 C2FC15 (CFC-111) 1.0 C2F2CI4 (CFC-112) 1.0 C3FC17 (CFC-211) 1.0 C3F2Cl6 (CFC-212) 1.0 C3F3CI5 (CFC-213) 1.0 C3F4CI4 (CFC-214) 1.0 C3F5Cl3 (CFC-215) 1.0 C3F6Cl2 (CFC-216) 1.0 C3F7C1 (CFC-217) 1.0

CC14 carbon tetrachloride 1.1

C2H3Cl3* 1,1,1-trichloroethane 0.1 (methyl chloroform)

This formula does not refer to 1,1,2-trichloroethane.

Group Substance

CHFC12 (HCFC-21) CHF2Cl (HCFC-22) CH2FC1 (HCFC-31) C2HFC14 (HCFC-121) C2HF2Cl3 (HCFC-122) C2HF3Cl2 (HCFC-123) C2HF4Cl (HCFC-124) C2H2FC13 (HCFC-131) C2H2F2Cl2 (HCFC-132) C2H2F3Cl (HCFC-133) C2H3FC12 (HCFC-141) C2H3F2Cl (HCFC-142) C2H4FC1 (HCFC-151) C3HFC16 (HCFC-221) C3HF2CI5 (HCFC-222) C3HF3Cl4 (HCFC-223) C3HF4Cl3 (HCFC-224) C3HF5Cl2 (HCFC-225) C3HF6Cl (HCFC-226) C3H2FC15 (HCFC-231) C3H2F2Cl4 (HCFC-232) C3H2F3Cl3 (HCFC-233) C3H2F4Cl2 (HCFC-234) C3H2F5Cl (HCFC-235) C3H3FC14 (HCFC-241) C3H3F2Cl3 (HCFC-242) C3H3F3Cl2 (HCFC-243) C3H3F4Cl (HCFC-244) C3H4FC13 (HCFC-251) C3H4F2Cl2 (HCFC-252) C3H4F3Cl (HCFC-253) C3H5FC12 (HCFC-261) C3H5F2CI (HCFC-262) C3H6FC1 (HCFC-271)

ARTICLE 2: ENTRY INTO FORCE

1. This Amendment shall enter into force on 1 January 1992, provided that at least twenty instruments of ratification, acceptance or approval of the Amendment have been deposited by States or regional economic integration organizations that are Parties to the Montreal Protocol on Substances that Deplete the Ozone Layer. In the event that this condition has not been fulfilled by that date, the Amendment shall enter into force on the ninetieth day following the date on which it has been fulfilled.

2. For the purposes of paragraph 1, any such instrument deposited by a regional economic integration organization shall not be counted as additional to those deposited by member States of such organization.

3. After the entry into force of this Amendment as provided under paragraph 1, it shall enter into force for any other Party to the Protocol on the ninetieth day following the date of deposit of its instrument of ratification, acceptance or approval.

DRAFT RESOLUTION APPROVED BY THE OPEN-ENDED WORKING GROUP OF THE PARTIES AT ITS FOURTH MEETING FOR CONSIDERATION By THE SECOND MEETING OF THE PARTIES

DRAFT RESOLUTION

[Draft resolution by the Governments and the curovean Community represented at the Second Meting of the Parties to the Montreal Protocol]

The [Parties to the Montreal Protocol represented at the Second meeting of the Parties] [Governments and the European Commmity represented at the Second Meeting of the Parties] resolve:

I. other halons not listed in Annex A. Group 11, of the Montreal Protocol ("Other halons')

1. To refrain from authorizing or to prohibit production and consumption of fully halogenated compounds containing one, two or three carbon atom and at least one atom each of bromine and fluorine,* and not listed in Group II of Annex A of the Montreal Protocol (hereafter called "other halons"), which are of such a chemical nature or such a quantity that they would pose a threat to the ozone layer; and

2. To refrain from using other halons except for those essential applications where other more environmentally suitable alternative substances or technologies are not yet available; and

3. To report to the Secretariat to the Protocol estimates of their annual production and consumption of such other halons.

11. Transitional substances

1. To apply the following guidelines to facilitate the adoption of transitional substances with a low ozone-depleting potential, such as hydrochlorofluorocarbons (HCFCs), where necessary. and their timely substitution by non-ozone depleting and more environmentally suitable alternative substances or technologies:

*(Reference is made to the list of other halons, that will appear in the Montreal Protocol Handbook to be prepared by the Executive Director.)

(a) Use of transitional substances should be limited to those applications where other more environmentally suitable alternative substances or technologies are not available;

[(b) Applications should at this time be restricted to specific uses within the areas of refrigeration (including air-conditioning and heat pumps) and of plastic foam for insulation purposes, and to very limited applications in the solvent area and in aerosols for medical uses. Use may also be tolerated where the use of other alternatives and technologies poses high hazard risks. Industry should not use transitional substances in applications not currently met by the controlled substances;]

[(b) Use of transitional substances should not be generally outside the areas of application currently met by the controlled and transitional substances, except in the ease of manifest social benefits;]

(c) Transitional substances should be selected in a manner that minimizes ozone depletion, in addition to meeting other environmental, safety and economic considerations;

(d) Emission control systems, recovery and recycling should, to the degree possible, be employed in order to minimize emissions to the atmosphere;

(e) Transitional substances should, to the degree possible, be collected and prudently destroyed at the end of their final use;

2. To review regularly the use of transitional substances, their contribution to ozone depletion and global warming, and the availability of alternative products and application technologies, with a view to their replacement by non-ozone depleting and more environmentally suitable alternatives and as the scientific evidence requires: at present, this should be no later than 2040 and, if possible, no later than 2020;

III. 1.1.1-triehloroethans (methyl chloroform)

1. To phase out production and consumption of methyl chloroform as soon as possible;

2. To request the Technology Review Panel to investigate the earliest technically feasible dates for reductions and total phase-out; and

3. To request the Technology Review Panel to report their findings to the preparatory meeting of the Parties with a view to the consideration by the Meeting of the Parties, not later than 1992;

IV. More stringent measures

1. To express appreciation to those Parties that have already taken measures more stringent and broader in scope than those required by the Protocol;

2. To urge adoption, in accordance with the spirit of paragraph 11 of Article 2 of the Protocol, of such measures in order to protect the ozone layer.

DRAFT DECISIONS APPROVED BY THE OPEN-ENDED WORKING GROUP OF THE PARTIES TO THE MONTREAL PROTOCOL AT ITS FOURTH MEETING FOR CONSIDERATION BY THE SECOND MEETING OF THE PARTIES

The Second Meeting of the Parties to the Montreal Protocol on Substances that Deplete the Ozone Layer decides:

To adopt in accordance with the procedure laid down in paragraphs 4 and 9 of Article 2 of the Montreal Protocol the adjustments and reductions of production and consumption of the controlled substances listed in Annex A to the Protocol, as set out in Appendix A to the report on the work of the Second Meeting of the Parties;

- To adopt in accordance with the procedure laid down in paragraph 4 of Article 9 of the Vienna Convention for the Protection of the Ozone Layer, the Amendment to the Montreal Protocol as set out in Appendix B to the report on the work of the Second Meeting of the Parties;

- To establish an ad hoe working group of experts to investigate, and make recommendations to the Fourth Meeting of the Parties in 1992 on the availability of substitutes for halons, the need to define essential uses of halons, methods of implementation and, if there is such a need, the identification of such uses;

- To clarify the definition of "controlled substance" in paragraph 4 of Article 1 of the Protocol so that it is understood to include the isomers of such substances except as specified in the relevant Annex;

- To adopt, on an interim basis, the procedures and institutional mechanism for determining non-compliance with the provisions of the Protocol and for treatment of Parties found to be in non-compliance, as set out in Appendix C to the report on the work of the Second Meeting of the Parties;

To extend the mandate of the open-ended Ad Hoe Working Group of Legal Experts to elaborate further procedures on non-compliance and terms of reference for the Implementation Committee and to present the results for review by the preparatory meeting to the Fourth Meeting of the Parties with a view to their consideration at the Fourth Meeting;

To agree that the phrase "at any time after four years of assuming the obligations" in Article 19 should be understood to mean at any time after four years after a Party's obligation to comply bee operative;

To invite the Executive Director t6 prepare as soon as possible a Montreal Protocol Handbook setting out the Protocol as adjusted, the Protocol as adjusted and amended and the decisions of the Parties that relate to its interpretation and other material relevant to its operation, and to update the Handbook, as necessary, after each meeting of the Parties;

To establish for the three-year period from 1 January 1991 to 31 December 1993 or until such time as the Financial Mechanism is established, an Interim Financial-Mechanism according to the following:

1. The Interim Financial Mechanism is established 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 the Montreal Protocol to enable their compliance with the control measures set out in Articles 2A to 2E 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 incidental 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 is attached as Appendix I to this decision.

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:

(i) Assist Parties operating under paragraph 1 of Article through country specific studies and other technical co-operation, to identify their needs for co-operation;

(ii) Facilitate technical co-operation to meet these identified needs;

(iii) Distribute, as provided for in Article 9 of the Protocol, information and relevant materials, and hold workshops, training sessions and other related activities for the benefit of Parties that are developing countries; and

(iv) Facilitate and monitor other multilateral, regional and bilateral co-operation available to Parties that are developing countries; and

(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 hereby 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. It is established for a three-year period. Before the end of that three-year period, the terms of reference of the Executive Committee shall be reviewed by the meeting of the Parties. 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. The terms of reference of the Executive Committee are attached as Appendix II to this decision.*

The appendices to the present draft decision are contained in annex V below.

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] [the level of consumption of the controlled substances in 19861 as in appendix III to this decision.* 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 [thirty) [twenty] [ten] per cent and consistent with any criteria 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 the Protocol;

(b) Provides additional resources; and

(c) Meets agreed incremental costs.

The terms of reference of the Multilateral Fund are attached as appendix IV to the present decision.*

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 decision 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 at least a majority of the Parties operating under paragraph 1 of Article 5 present and voting and at least a majority of the Parties not so operating present and voting.

10. The Financial Mechanism set out in this decision is without prejudice to any future arrangements that may be developed with respect to other environmental issues.

11. References to the Appendices in this Decision to Dollars are to United States Dollars unless otherwise stated.

The appendices to the present draft decision are contained in annex V below.

To establish an ad hoe group of experts to consider the reasons leading to the difficulties faced by some countries in reporting data as required by Article 7 of the Protocol and to recommend possible solutions to the Parties concerned and to report on its progress to the Third Meeting of the Parties; and

To confirm that any data on consumption of the controlled substances that are submitted to the Secretariat as required by Article 7 of the Protocol are not to be confidential;

To ask the Secretariat to determine from the data available to it the exact quantities of the controlled substances required by developing countries operating under paragraph I of Article 5 and the possible sources of supply to assist developed countries to authorize their companies to produce the additional amounts needed within the percentages authorized by Article 2 and Articles 2A to 2E of the Protocol;

To request the Secretariat to publish in its annual report on data an updated list of developing countries which, on the basis of complete data submissions, are considered to be operating under paragraph 1 of Article S. The Secretariat shall also publish a list of developing countries that, having submitted incomplete or estimated data, appear to qualify as Parties operating under paragraph 1 of-Article 5. In accordance with the provisions of Article 5 of the Protocol, no Party will be eligible for paragraph I of Article 5 treatment until it submits complete data to the Secretariat establishing that its annual calculated per capita level of consumption is below 0.3 kg;

To establish an ad hoe technical advisory committee on destruction technologies and to appoint its Chairman, who shall appoint in consultation with the Secretariat up to nine other members on the basis of nomination by Parties. The members shall be experts on destruction technologies and selected with due reference to equitable geographical distribution;

The committee shall analyse destruction technologies and assess their efficiency and environmental acceptability and develop approval criteria and measurements. The committee shall report regularly to meetings of the Parties;

To agree with the recommendations adopted by the customs Co-operation Council that all member administrations take actions to reflect the adopted subheadings in their national statistical nomenclatures as soon as possible, and to ask the Secretariat to inform the Council that the Parties, having determined that additional subheadings for individual chemicals controlled by the Montreal Protocol would be useful in their efforts to protect the ozone layer, request the assistance of the Council in this regard;

To request the Technology Review Panel to assess, in accordance with Article 6, the earliest technically feasible dates and the costs for reductions and total phase-out of 1,1,1-trichloroothane (methyl chloroform) and to report its findings in time for consideration by the preparatory meeting to the Fourth Meeting of the Parties with a view to their consideration at that Fourth Meeting;

To request the Secretariat to convene members of each of the four assessment panels established by the First Meeting of Parties to review new information and to consider its inclusion in supplementary reports in time for consideration by the Fourth Meeting of the Parties, subject to a review of their mandate in the context of Article 2, paragraph 9, at the Third Meeting of the Parties;

To request the Technology Review Panel to include in its work:

(a) An evaluation of the need for transitional substances in specific applications; and

(b) An analysis of the quantity of controlled substances required by Parties operating under paragraph 1 of Article 5 for their basic domestic needs, both at present and in the future, and the likely availability of such supplies; and

(c) A comparison of the toxicity, flammability, energy efficiency implications and other environmental and safety considerations of chemical substitutes, along with an analysis of the likely availability of substitutes for medical uses;

To request the Scientific Assessment Panel, to include in its work:

1. An evaluation of the ozone depletion potential, other possible ozone layer impacts, and global warming potential of chemical substitutes (e.g. HCFCs and HFCs) for controlled substances;
2. An evaluation of the likely ozone depletion potential of "other halons" that might be produced in significant quantities; and

(c) An analysis of the anticipated impact on the ozone layer of the revised control measures reflecting the changes adopted at the Second Meeting of the Parties taking into account the current level of global participation in the Protocol;

- To undertake efforts to encourage broad participation in all assessment panels by experts from developing countries;

- To request the Executive Committee under the Financial Mechanism and the Secretariat to take into account in their work the recommendations on workplans required by Article 9 and Article 10 of the Protocol, as adopted by the third session of the first meeting of the Open-Ended Working Group of the Parties to the Protocol;

Decision 11/15. Extension of the mandate of the open-ended Working Group of the Parties

- To continue the work of the open-ended Working Group of the Parties and to extend its mandate to consider, if necessary and in particular, the following topics:

(a) Further elaboration of any remaining details of the various components of the Financial Mechanism;

(b) Identification of the most appropriate modalities for the transfer of technologies designed for the protection of the ozone layer;

(c) Co-operation with Parties that are developing countries for the implementation of the Protocol; and

(d) Problems arising under the trade provisions of the Protocol, in respect of both trade between Parties and trade with non-Parties including issues related to free-trade zones, and to make recommendations to the Third Meeting of the Parties;

- To recommend that the Parties to the Vienna Convention for the Protection of the Ozone Layer review, at the earliest opportunity, Article 9 of the Convention with a view to expediting the amendment procedure for protocols;

To adopt the system of rolling biennial budgets, and to approve a total revised budget of $US3,400,000 for 1990, a total revised budget for 1991 of $US2,423,000 and a total budget for 1992 of $US2,225,000, the details of the approved budgets are presented in

To authorize the Secretariat to convene, if necessary, up to six meetings of the open-ended Working Group of the Parties prior to the Third Meeting of the Parties and to invite non-Parties to participate in the deliberations of these meetings;

To amend paragraph 1 of rule 21 of the rules of procedure, adopted at the First Meeting of the Parties, to include the following additional sentences:

"In electing its officers, the Meeting of the Parties shall have due regard to the principle of equitable geographical representation. The offices of President and Rapporteur of the Meeting of the Parties shall normally be subject to rotation among the five groups of States referred to in section I, paragraph 1, of General Assembly resolution 2997 (XKVII) of 15 December 1972, by which UNKP was established.";

To convene the Third Meeting of the Parties from 19 to 21 June 1991 in conjunction with and at the same venue as the Second Meeting of the Conference of the Parties to the Vienna Convention.

APPENDICES TO DRAFT DECISION 11/8 ("FINANCIAL MECHANISM") APPROVED BY THE OPEN-ENDED WORKING GROUP OF THE PARTIES TO THE MONTREAL PROTOCOL AT ITS FOURTH MEETING FOR CONSIDERATION BY THE SECOND MEETING OF THE PARTIES*

INDICATIVE LIST OF CATEGORIES OF INCREMENTAL COSTS

1. The evaluation of requests for financing Incremental costs of a given project shall take into account the following general principles:

(a) The most cost-effective and efficient option should be chosen, taking into account the national industrial strategy of the recipient party. It should be considered carefully to what extent the infrastructure at present used for production of the controlled substances could be put to alternative uses, thus resulting in decreased capital abandonment, and how to avoid deindustrialization and loss of export revenues;

(b) Consideration of project proposals for funding should involve the careful scrutiny of cost items listed in an effort to ensure that there is no double counting;

(e) Savings or benefits that will be gained at both the strategic and project levels during the transition process should be taken into account on a ease-by-ease basis, according to criteria decided by the Parties and as elaborated in the guidelines of the Executive Committee;

(d) The funding of incremental costs is intended as an incentive for early adoption of ozone protecting technologies. In this respect the Executive Committee shall agree which time scales for payment of incremental costs are appropriate in each sector.

2. Incremental costs that once agreed are to be met by the financial mechanism include those listed below. If incremental costs other than those mentioned below are identified and quantified, a decision as to Whether they are to be met by the financial mechanism shall be taken by the Executive Committee consistent with any criteria decided by the Parties and elaborated in the guidelines of the Executive Committee. The Incremental recurring costs apply only for a transition period to be defined. The following list is Indicative:

The text of draft decision II/S is contained in annex IV above.

(a) Supply of substitutes

(i) Cost of conversion of existing production facilities:

- cost of patents and designs and incremental cost of royalties;

- capital cost of conversion;

- cost of retraining of personnel, as well as-the cost of research to adapt technology to local circumstances;

(ii) costs arising from premature retirement or enforced idleness, taking into account any guidance of the Executive Committee on appropriate cut-off dates:

- of productive capacity previously used to produce substances controlled by existing and/or amended or adjusted Protocol provisions; and

- where such capacity Is not replaced by converted or now capacity to produce alternatives;

(iii) Cost of establishing new production facilities for substitutes of capacity equivalent to capacity lost when plants are converted or scrapped, including:

- cost of patents and designs and incremental cost of royalties;

- capital cost;

- cost of training, as well as the cost of research to adapt technology to local circumstances;

(iv) Net operational cost, including the cost of raw materials;

(v) Cost of Import of substitutes;

(b) Use in manufacturing as an intermediate zoom:

(i) Cost of conversion of existing equipment and product manufacturing facilities;

(ii) Cost of patents and designs and incremental cost of royalties;

(iii) Capital cost;

(iv) Cost of retraining;

(v) Cost of research and development;

(vi) Operational cost, including the cost of raw materials except where otherwise provided for;

(c) End use:

(i) Cost of premature modification or replacement of user equipment;

(ii) Cost of collection, management, recycling, and, if cost effective, destruction of ozone-depleting substances;

(iii) Cost of providing technical assistance to reduce consumption and unintended emission of ozone-depleting substances.

TERMS OF REFERENCE OF THE EXECUTIVE COMMITTEE

1. The Executive Committee of the Parties is established 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 under the Financial Mechanism.

2. The Executive Committee shall consist of seven Parties from the group of Parties operating under paragraph 1 of Article 5 of the Protocol and seven Parties from the group of Parties not so operating. Each group shall select its Executive Committee members. The members of the Executive Committee shall be formally appointed by the meeting of the Parties.

3. The Chairman and Vice-Chairman shall be selected from the fourteen Executive Committee members. The office of Chairman is subject to rotation, on an annual basis, between the Parties operating under paragraph 1 of Article 5, and the Parties not so operating. The group of Parties entitled to the chairmanship shall select the Chairman from among their members of the Executive Committee. The Vice-Chairman shall be selected by the other group From within their number.

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

5. The meetings of the Executive Committee shall be conducted in those official languages of the United Nations required by members of the Executive Committee. Nevertheless the Executive Committee may agree to conduct its business in one of the United Nations official languages.

6. Costs of the Executive Committee meetings, including travel and subsistence of Committee participants from Parties operating under paragraph 1 of Article 5, shall be disbursed from the multilateral Fund as necessary.

7. The Executive Committee shall ensure that the expertise required to perform its functions is available to it.

8. The Executive Committee shall meet at least twice a year.

9. The Executive Committee shall adopt other rules of procedure on a provisional basis and in accordance with paragraphs 1 to 8 of these terms of reference. Such provisional rules of procedure shall be submitted to the next annual meeting of the Parties for endorsement. This procedure shall also be followed When such rules of procedure are amended.

10. The functions of the Executive Committee shall include:

(a) To develop and monitor the implementation of specific operational policies, guidelines and administrative arrangements, including the disbursement of resources;

(b) To develop the three year plan and budget for the multilateral Fund, including allocation of multilateral fund resources among the agencies identified in paragraph 5 of the decision 11/8;

(c) To supervise and guide the administration of the multilateral Fund;

(d) To develop the criteria for project eligibility and guidelines for the implementation of activities supported by the multilateral Fund;

(e) To review regularly the performance reports on the Implementation of activities supported by the multilateral Fund;

(f) To monitor and evaluate expenditure incurred under the multilateral Fund;

(g) To consider, and, where appropriate, approve country programes for compliance with the Protocol and, in the context of those country programmes, assess and, where appropriate, approve all project proposals or groups of project proposals where the agreed incremental costs exceed $500,000;

(h) To review any, disagreement by a Party operating under paragraph 1 of Article 5 with any decision taken with regard to a request for financing by that Party of a project or projects where the agreed incremental costs are less than $500,000;

(I) To assess annually whether the contributions through bilateral co-operation, including particular regional cases, comply with the criteria set out by the Parties for consideration as part of the contributions to the multilateral Fund;

(j) To report annually to the meeting of the Parties on the activities exercised under the functions outlined above, and to make recommendations as appropriate;

(k) To nominate, for appointment by the Executive Director of UNLO, the Chief officer of the Fund Secretariat, who shall work under the Executive Committee and report to It; and

1. To perform such other functions as may be assigned to it by the meeting of the Parties.

PERCENTAGES OF CONTRIBUTIONS

1. The table below shows the percentages of contributions to finance the multilateral fund by each Party that is not operating under paragraph 1 of Article 5.

2. Columns in the table show the percentages of contributions to be made as follows:

Column 1: United Nations scale of assessments as adopted on 16 December 1988. Column 2: Percentages of contribution based on the United Nations scale of assessments, with a 25 per cent ceiling. Column 3: Percentages of contribution based on adjusted United Nations seals of assessments, with no ceiling. Column 4: Percentages of contribution based on the 1986 calculated level of [estimated] consumption of controlled substances; the figures for this column can be provided by the Secretariat if so decided by the second meeting of the Parties. [This column requires decision by the Parties to authorize exposure of the estimated or calculated level of consumption by each Party]

PERCENTAGES OF CONTRIBUTIONS BY THE PARTIES BASED ON THE UN SCALE OF ASSESSMENT AND 1986 ESTIMATED CONSUMPTION OF THE CONTROLLED SUBSTANCES

Party United Nations Percentage Percentage Percentage scale of contribution contribution contribution assessments based on the based on the based on 1986 M UY scale, with UN scale, with estimated a 25% ceiling no ceiling consumption M (%) M

Brazil 1.45 0.00 0.00 Burkina Faso 0.01 0.00 0.00 Cameroon 0.01 0.00 0.00 Chile 0.08 0.00 0.00 Ecuador 0.03 0.00 0.00 Egypt 0.07 0.00 0.00 Fiji 0.01 0.00 0.00 Ghana 0.01 0.00 0.00 Guatemala 0.02 0.00 0.00 Jordan 0.01 0.00 0.00 Kenya 0.01 0.00 0.00 Malaysia 0.11 0.00 0.00 Maldives 0.01 0.00 0.00 Mexico 0.94 0.00 0.00 Nigeria 0.20 0.00 0.00 Sri Lanka 0.01 0.00 0.00 Syrian Arab Republic 0.04 0.00 0. Thailand 0.10 0.00 0.00 Trinidad and Tobago 0.05 0.05 0.00 0.00 Tunisia 0.03 0.00 0.00 Uganda 0.01 0.00 0.00 Venezuela 0.57 0.00 0.00 Zambia 0.01 0.00 0.00

Bahrain 0.02 0.02 0.02 Malta 0.01 0.01 0.01 Panama 0.02 0.02 0.02 Singapore 0.11 0.13 0.12 United Arab Emirates 0.19 0.22 0.21

Party United Nations Percentage Percentage Percentage scale of contribution contribution contribution assessments based on the based on the based on 1986 M UN scale, with UN scale, with estimated a 25% ceiling no ceiling consumption M M M

Australia 1.57 1.79 1.73 Austria 0.74 0.84 0.81 Canada 3.09 3.52 3.40 Finland 0.51 0.58 0.56 German Democratic Republic 1.28 1.46 1.41 Hungary 0.21 0.24 0.23 Iceland 0.03 0.03 0.03 Japan 11.38 12.95 12.50 New Zealand 0.24 0.27 0.26 Norway 0.55 0.63 0.60 South Africa 0.45 0.51 0.49 Sweden 1.21 1.38 1.33 Switzerland 1.08 1.23 1.19 Liechtenstein 0.01 0.01 1.01 USSR 9.99 11.36 10.98 Byelorussian SSR 0.33 0.38 0.36 Ukrainian SSR 1.25 1.42 1.37 25.00 25.00 27.47 E.E.C. 0 2.50 2.50 EEC (total for member States) 29.46 33.51 32.37 Belgium 1.17 1.33 1.29 Denmark 0.69 0.78 0.76 France 6.25 7.11 6.87 Germany, Federal Republic of 8.08 9.19 8.88 Greece 0.40 0.46 0.44 Ireland 0.18 0.20 0.20 Italy 3.99 4.54 4.38 Luxembourg 0.06 0.07 0.07 Netherlands 1.65 1.88 1.81 Portugal 0.18 0.20 0.20 Spain 1.95 2.22 2.14 United Kingdom 4.86 5.53 5.34 TOTAL 92.52 100.00 100.00

TERMS OF REFERENCE FOR THE INTERIM MULTILATERAL FUND

A. Establishment

1. An interim Multilateral Fund of $160'million, which could be raised by up to $80 million during the three-year period when more countries become Parties to the Protocol,] hereinafter referred to as "the Multilateral Fund", shall be established.

B. Roles of the implementing agencies

2. Under the overall guidance and supervision of the Executive committee in the discharge of its policy-making, functions:

(a) Implementing agencies shall be requested by the Executive committee, In the context of country programmes developed to facilitate compliance with the Protocol, to co-operate with and assist the Parties within their respective areas 9f expertise; and

(b) Implementing agencies shall be Invited by the Executive Committee to develop an inter-agency agreement and specific agreements with the Executive Committee acting on behalf of the Parties;

Implementing agencies shall apply only those considerations relevant to effective and economically efficient programmes and projects which are consistent with any criteria adopted by the Parties.

3. Specifically,

(a) The United Nations Environment Programme shall be invited by the Executive Committee to co-operate and assist in political promotion of the objectives of the Protocol, as well as in research, data gathering and the clearing-house functions;

(b) The United Nations Development Programme and such other agencies which, within their areas of expertise may be able to assist, shall be invited by the Executive committee to co-operate and assist in feasibility and pre-investment studies and in other technical assistance measures;

(c) The World Bank shall be invited by the Executive Committee to co-operate and assist in administering and managing the programme to finance the agreed incremental costs;

(d) Other agencies, in particular regional development banks, shall also be invited by the Executive Committee to co-operate with and assist It in carrying out Its functions.

4. The Executive Committee shall draw up reporting criteria and shall invite the implementing agencies to report regularly to It In accordance with those criteria.

5. The Executive Committee shall invite the implementing agencies, in fulfilling their responsibilities in respect of the multilateral Fund, to consult regularly. It shall also invite the heads of the agencies, or their representatives, to meet at least once a year to report on their activities and consult on co-operative arrangements.

6. The implementing agencies shall be entitled to receive support costs for the activities they undertake having reached specific agreements with the Executive Committee.

C. Budget and contributions

7. The Multilateral Fund shall be financed in accordance with paragraph 6 of decision 11/8. In addition, contributions may be made by countries not Party to the Protocol, and by other governmental, intergovernmental, non-governmental and other sources.

8. The contributions referred to in paragraph 7 (a) above, are to be based on the scale of contributions set out in appendix III. Bilateral, and in particular cases, regional co-operation by a country not operating under paragraph 1 of Article 5 may, according to criteria adopted by the Parties, be considered as a contribution to the multilateral Fund up to a total of [thirty) [twenty] [ten] per cent of the total contribution by that Party set out in appendix III.

9. All contributions other than the value of bilateral and agreed regional co-operation referred to in paragraph 8 above shall be In convertible currency or, in certain circumstances, in kind and/or in national currency.

10. Contributions from States that become Parties not operating under paragraph 1 of Article 5 after the beginning of the financial period of the mechanism shall be calculated on a pro rats, basis for the balance of the financial period.

11. Contributions not immediately required for the purposes of the multilateral Fund shall be invested under the authority of the Executive Committee and any interest so earned shall be credited to the multilateral Fund.

12. Budget estimates setting out the income and expenditure of the Fund prepared in United States dollars, shall be drawn up by the Executive Committee and submitted to the regular meetings of the Parties to the Protocol.

13. The proposed budget estimates shall be dispatched by the Fund Secretariat to all Parties to the Protocol at least sixty days before the date fixed for the opening of the regular meeting of the Parties to the Protocol at which they are to be considered.

14. After entry into force of the Amendment to the Protocol, the Financial Mechanism shall be established by the Parties at their next regular meeting and any resources remaining in the interim multilateral Fund shall be transferred to the multilateral Fund established under that mechanism.

D. Administration

15. The World Bank shall be invited by the Executive Committee to co-operate with and assist it in administering and managing the programme to finance the agreed incremental costs of Parties operating under paragraph 1 of Article 5. Should the World Bank accept this invitation, in the context of an agreement with the Executive Committee, the President of the World Bank shall be the Administrator of this programme, which shall operate under the authority of the Executive Committee.

16. The Executive Committee shall encourage the involvement of other agencies, in particular the regional development banks, in carrying out its functions effectively in relation to the programme to finance the agreed incremental costs.

17. The Fund Secretariat operating under the Chief officer co-located with the United Nations Environment Programme (UNEP) at a place to be decided by the Executive Committee shall assist the Executive Committee in the discharge of its functions. The Multilateral Fund shall cover Secretariat costs, based on regular budgets to be submitted for decision by the Executive Committee.

18. In the event that the Chief Officer of the Fund Secretariat anticipates that there may be a shortfall in resources over the financial period as a whole, he shall have discretion to adjust the budget approved by the Parties so that expenditures are at all times fully covered by contributions received.

19. No commitments shall be made in advance of the receipt of contributions, but income not spent in a budget year and unimplemented activities may be carried forward from one year to the next within the financial period.

20. At the end of each calendar year, the Chief Officer of the Fund Secretariat shall submit to the Parties accounts for the year. The Chief officer shall also, as soon as practicable, submit the audited accounts for each period so as to coincide with the accounting procedures of the implementing agencies.

21. The Fund Secretariat and the implementing agencies shall co-operate with the Parties to provide information on funding available for relevant projects, to secure the necessary contacts and to co-ordinate, when requested by the interested Party, projects financed from other sources with activities financed under the Protocol.

22. The financing of activities or other costs, including resources channelled to third party beneficiaries, shall require the concurrence of the recipient Governments concerned. Recipient Governments shall, where appropriate, be associated with the planning of projects and programmes where appropriate.

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