Abstract

The World Bank Inspection Panel is an independent complaints mechanism for people and communities who believe that they have been, or are likely to be, adversely affected by a World Bank-funded project. In particular, the complaints to the Panel concern issues related to projects financed by International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA), otherwise the complaints related to the projects supported by other agencies of the World Bank Group, like International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA), are dealt with by the Office of the Compliance Advisor Ombudsman (CAO). The Inspection Panel was the first body to promote accountability among international financial institutions. The Inspection Panel process aims to promote accountability at the World Bank, give affected people a greater voice in activities supported by the World Bank that affect their rights and interests, and foster redress when warranted.

Structure

The World Bank Inspection Panel is a permanent body with a very simple structure characterized by the work of three members (inspectors), each coming from a different Member State Bank. This number is similar to the classical system of international control organs because is an odd number and it facilitates the formation of majorities necessary for the deliberations. Inspectors shall remain in office for five years and are nominated by the Executive Directors on the proposal of the World Bank President. They can’t work in other professional activities, except with authorization by the Board of Governors of the World Bank.

The Panel is chaired by first inspector named and to whom is entrusted the direction of the services and direction of hearings and the related resolutions.

In addition to the three inspectors is expected the Executive Secretary, nominated by the President of the Bank after consultation with the Board of Governors. The Executive Secretary attends all meetings of the Panel, but is deprived of the right to vote. The Executive Secretary is a mediator between the body and the applicants.

In the performance of their functions, members of the Panel shall be officials of the Bank enjoying the privileges and immunities accorded to Bank officials, and shall be subject to the requirements of the Bank’s Articles of Agreement concerning their exclusive loyalty to the Bank.

Mandate

The mandate of the Panel focuses on monitoring of the activities of the World Bank and its "policies", "procedures" and "operational directives", during the execution of a project. These policies and internal operating procedures look at many issues such as environmental and local populations protection that could be damaged in the realization of the project financed by the Bank.

The Panel analyzes projects financed by IBRD and IDA because the IFC and MIGA are not subject to its investigations. If, therefore, the responsibility of the damage is not attributable directly to the Bank (IBRD and IDA) or, for example, it’s responsibility of loan recipient, the request for an investigation of the Panel can’t be accepted.

The Panel exists primarily to evaluate the admissibility of actions, which must meet certain eligibility criteria:

1. The exhaustion of domestic remedies: in cases where the guarantee instruments provided by the domestic law of the World Bank, haven’t remedied the prejudice situations.

2. The connection between the acts and omissions of the World Bank: the existence of a direct causal connection between the acts attributable to the Bank and the material injury suffered by the applicants.

3. The time criteria: the Panel is not entitled to act if the request is made after the end of the loan or after the loan has been granted for more than 95% of the total.

Affected parties to request inspection

The affected parties must have two fundamental characteristics to request the Panel intervention:

1. The part must be composed by a group of individual and not by a single person.

2. The part must be resident in the area affected by the implementation of a project financed by the Bank.

Can be eligible to request an inspection: individuals (at least two), associations, local representatives, NGOs and in addition a single Executive Director or the Board of Executive Directors.

Inspection Process

The Panel inspection process can be divided in four phases: inspection request, preliminary examination, inspection and final report.

The inspection request: a request to perform an investigation must be submitted in writing and must contain a variety of information, about how policies and operating procedures have been infringed and a description of how the applicant has been injured. If the Panel Chairman considers that the issue is outside the mandate of the Panel, he will notify to the applicant . The Panel Chairman must be notify the request to the Executive Directors and the Chairman of the Bank. Within 21 days after notification, the Bank's management shall provide evidence to the Panel that it has complied with the policies and operating procedures of the Bank in the implementation of the project, or that it intends to comply with these policies and procedures from the moment.

The preliminary examination: no later than 21 days from the response of the management, the Panel must conduct a preliminary investigation to verify that exist conditions to enable an investigation procedure. The Panel must verify the following items:

1. Entitlement of the applicant (jurisdiction ratione personae).

2. Relevance of the action (jurisdiction ratione materiae).

3. Time criteria (jurisdiction ratione temporis).

After the preliminary examination, the Panel will recommend to the Executive Directors to start an inspection. The Executive Directors, meeting within the Council, must take the decision to authorize the Panel to start an inspection.

Inspection: the Panel has the power to conduct investigations in consultation with staff members and if necessary, the General Manager and the Operations Evaluation Department of the World Bank. In addition, this body has access to all documents of the Bank. It will be possible to consult the Executive Director who represent the beneficiary of the loan and make any investigation on the country territory in which the project is being carried out with the consent of the State concerned. Final Report: at the end of the inspection, the Panel shall prepare a written report based on the results of the investigation, determines whether or not the Bank has complied with its policies and procedures. This report is presented to the Executive Directors and the Chairman of the Bank. The Executive Directors, within two weeks after receiving the report, shall inform the applicant of the investigation’s results and about any action the Bank intend to take.

Legal status of Panel acts and limits

The Panel was created by an act of the Bank and is therefore formally subordinate to his administrative bodies. The establishment of the Panel through an amendment to the World Bank Agreement, or through an additional protocol, could be give more strong to the Panel functions. In fact, the Panel is characterized by a complete absence of decision-making power because the Executive Directors have the power to authorize a procedure for the investigation and, subsequently, whether or not to act on the recommendations of the Panel.

The need to make the panel an independent body collides with the fact that its members are considered officers of the Bank. They are, therefore, employees of that institution on which they perform a inspection, which automatically reduces the independence and impartiality required.

The Panel acts are not binding and have no powers of sanction. The final report, in fact, is to be considered "invitation" for the implementation of Bank conduct and it’s legally irrelevant, but not without effects. Although the final report has not sanctioning powers, the relationship can become a significant mechanism of pressure on the management because it has been produced by an independent body. For example, the evaluation of World Bank officials’ negligence as a possible consequence may result in the initiation of disciplinary action.

Disputes about the birth of the Panel

Since the eighties, the discrepancy between the dictates of World Bank internal policies and its concrete actions has caused criticism on the international arena. In fact, the main reasons for the birth of this institution are to be found in the poor results achieved by financing activities and for transparency needs in relation to any damage or harm caused by the activities of the Bank.

The need to create a real surveillance system on the funding of the institute has collided with the will of developing countries. These countries did not want to activate an organ that could be a mechanism of intrusion in the performance of their development projects.

For these reasons, the organization of work on Panel creation has been appointed by a division between industrialized and developing countries. The Western countries, civil society and NGOs have supported the need for this body, but the main opponents were those developing countries that considered Panel a possible source of delays in the execution of development plans. These reasons have weakened the original mandate of this body which is in fact devoid of a real decision-making power.

The Wordl Bank Inspection panel https://www.inspectionpanel.org/

References

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SEATZU F. (2008) Il Panel d’ispezione della Banca Mondiale, Torino, Giappichelli Editore
SHIHATA I. F. (2000) The World Bank Inspection Panel: in practice, World Bank Publications, No.1 (https://documents.worldbank.org/curated/en/2000/01/693314/world-bank-inspection-panel-practice)
VEZZANI S. (2011) Gli accordi delle Organizzazioni del Gruppo della Banca Mondiale, Torino, Giappichelli Editore(https://www.giappichelli.it/gli-accordi-delle-organizzazioni-del-gruppo-della-banca-mondiale)

Editor: Giovanni AVERSA