1) As recognized in the Bank's policy on confidentiality and disclosure of information (R134-94), approved on 9 September 1994), the Bank's private sector loans and investments differ in a number of fundamental respects from the Bank's public sector operations, necessitating different treatment under certain of the Bank's policies. For example, under the Bank's confidentiality and disclosure policy, only limited information concerning a private sector project can be made publicly available without the project sponsor's consent. This special treatment is justified by the expectations of confidentiality that most private sector sponsors have regarding their business plans and operations and by the confidentiality undertakings that these sponsors ordinarily request from their co-sponsors and financiers. Because limited information will be publicly available concerning the Bank's private sector operations, and because the Bank's minority stake in any private sector project will ordinarily limit its ability to influence changes in the scope or implementation of the project, the inspection procedures proposed in this paper may not be effective or appropriate for private sector projects. (Notably, the World Bank's inspection procedures, which are described later in this paper, do not apply to the activities of the International Finance Corporation (IFC), its private sector affiliate, and IFC has not established such procedures for its own operations.) Given the special considerations and limitations that would apply to any inspections of private sector projects, it is considered advisable initially to exclude private sector operations from the scope of the Bank's inspection function, but to reconsider the matter as part of Management's general review of the inspection function after two years.

2) In addition, at any time, the Board of Executive Directors can instruct the WB Panel to conduct an inspection. In special cases involving serious alleged violations of World Bank policies and procedures, a single Executive Director can also ask the Panel to conduct an inspection.

3) However, in order to maintain continuity, the terms of office of BIC members will be staggered by reducing to one year the term of office of three of the initial BIC members. The names of these three members will be chosen by lot by the President promptly after the first appointments have been made.

4) The operational policies and procedures that apply to a Bank project under inspection will be those that were in effect on the date the project was approved (or, in the case of a proposed project or in the case of a request regarding the administration of an ongoing project, those that were in effect on the date the inspection request was filed with the BIC).

For a project processed or approved by the Board prior to the reorganization of the OM into Bank Policies and Operational Procedures and into Guidelines on Operational Procedures separate from the OM, the operational policies and procedures that apply will be those relating to the formulation, processing and implementation of Bank projects and that were included in the OM in effect on the relevant date. It will be for the BIC to determine which portions of the relevant sections of the OM prior to its reorganization are operational policies and procedures and which portions are, in effect, guidelines on operational procedures or other materials that do not in themselves constitute operational policies and procedures; an inspection panel may request the BIC for such a determination in respect of any relevant OM section.

5) Any concerns that Directors may have about compliance with the Bank's policies and procedures in respect of a proposed project can be addressed at the time of Board consideration of the project for approval.

6) While a request by an outside group can pertain to a proposed or ongoing Bank project, a request for inspection by one or more Directors may relate only to an ongoing Bank project, as provided in paragraph 29 above. A Director's request need not demonstrate that he/she is representing a particular community or other group, but must demonstrate that a serious violation of the Bank's operational policies and procedures in an ongoing project has had or is likely to have a direct and material adverse effect on a community or other group residing in the country where the project is being implemented or residing in an adjacent member country.

7) The cycle for processing of requests for inspection is schematically described in the attached Annex. All time periods provided for action by the applicant or Management may be extended with the consent of the other party or by the BIC, and all time periods provided for action by the BIC may be extended by the Board.

8) R134-94, approved on 9 September 1994.

9) Such consultants will be engaged by the Bank on behalf of the Panel under standard Bank procedures for engaging staff consultants.

Return to thee Asian Development Bank (ADB) Inspection Panel Homepage