MMI Strategic Plan Recommendation 33: Rescind the GA resolution of 2000 providing for a discount for early payment Recommendation 43: Reconsider draft resolution 1757/2000 to penalize member states that are severely in arrears

Resolution “Measures to encourage the timely payment of quotas” AG/RES (XXX-O/00 – Discussion paper AG/RES (XXX-O/00 Presented by the Chair of the Ad-Hoc Working Group on the Implementation of the Strategic Plan for Management Modernization – February 26, 2016

Prompt Payment Discount – Drawback Since 2000, the prompt payment discount policy has resulted in a loss of revenue of $5,805,851 for the OAS

Prompt Payment Discount - Benefit The monthly cash balance in the Regular Fund between income received and cash expended fluctuates considerably depending on the timing of quota payments. With an average execution of approximately $7M per month, and in the absence of a cash balance in the Reserve Sub-fund, the timely payment of quotas becomes critical to the normal operations financed by the Regular Fund

Discount as an incentive - Excerpt from the Resolution Pursuant to Article 107 of the General Standards, Regular Fund quotas are considered due on the first day of the fiscal year. The Permanent Council adopted a “prompt payment policy” in 1990 [1], offering a 2% quota discount beginning in 1992 to member states paying their full quota assessments prior to May 1, in order to respond to the prevalence of late payments of assessments in the period prior to The policy was adjusted in 2000, increasing the discount offered for full payment in January to 3%. From , discounts were: [1] ▫3% for full payment by January 31 ▫2% for full payment by April 30 In 2011, the policy was again adjusted, with a view to encouraging greater promptness and reducing the cost of discounts to the Regular Fund, by reducing the discount for full payment to 1% in March and zero thereafter. Since 2012, discounts have been: ▫3% for full payment by January 31 ▫2% for full payment by February 28 ▫1% for full payment by March 31 [1] [1] CP/RES. 541 (816/90) Regulation of the Obligation of the Member States to Pay their Assessments to the Regular Fund.

Member States qualifying for prompt payment discounts The data show an increasing number of member states paying in time to receive discounts, from an average of 6 in to an average of 13 in

Annex B of the Resolution “Measures pending further evaluation and consensus”

Annex B 1. Only those member states that are "current" or "considered current" shall be eligible to use for hosting or sponsoring social and cultural events the Hall of the Americas and other General Secretariat facilities without being required to reimburse the Regular Fund, through the General Secretariat, the full operating costs associated with that use; however, this provision shall not apply to the use of those facilities for the celebration of a member state's national day or national week. 2. Fellowships financed by the Regular Fund shall be available only to nationals and residents of member states that are "current" or "considered current.“ 3. Except as expressly provided in Article 81 of the Charter, only those member states that are "current" or "considered current" shall be eligible to serve as chairpersons and vice chairpersons of Committee of the Councils or to have members of their delegations serve in those posts. 4. Only those member states that are "current" or "considered current" shall be eligible to nominate candidates for Secretary General and Assistant Secretary General, and only nationals of member states that are "current" or "considered current" shall be eligible for election to those posts. 5. Only those member states that are "current" or "considered current" shall be eligible to nominate candidates for the Administrative Tribunal and the Board of External Auditors, and only nationals of member sates that are "current" or "considered current" shall be eligible for election to serve on those entities.

Practice at other multilateral organizations – Document “Sanctions on Member States for arrears in quota payments, prepared by the Department of Legal Services (GT/IMG-10/16) Possible suspension of membership with no rights, while remaining subject to all obligations, a year from the date of suspension (IBRD, IDB) Automatic suspension of voting rights in the General Assembly after non-payment for two consecutive years unless due to conditions beyond the control of the member (UN) Suspension of voting privileges after non-payment for two consecutive years unless due to conditions beyond the control of the member (PAHO) Suspension of voting rights but allowed to participate in deliberations (CARICOM) Barred from chairmanship positions, no speaking rights at meetings, no benefit from financial assistance, and no nationals of countries in arrears to be hired (African Caribbean and Pacific group of States)