proval of the Corporation plus interest, earnings, or profits actually accrued on such investment to the extent provided by such insurance, reinsurance, or guaranty, except that the Corporation may provide that (1) appropriate adjustments in the insured dollar value be made to reflect the replacement cost of project assets, and (2) compensation for a claim of loss under insurance of an equity investment may be computed on the basis of the net book value attributable to such equity investment on the date of loss.225 Notwithstanding the preceding sentence, the Corporation shall limit the amount of direct insurance and reinsurance issued by it under section 234 or 234A so that risk of loss as to at least 10 per centum of the total investment of the insured and its affiliates in the project is borne by the insured and such affiliates, except that limitation shall not apply to direct insurance or reinsurance of loans by banks or other financial institutions to unrelated parties and 226 (3) 227 compensation for loss due to business interruption may be computed on a basis to be determined by the Corporation which reflects amounts lost.

(g) No payment may be made under any guaranty, insurance or reinsurance 223 issued pursuant to this title for any loss arising out of fraud or misrepresentation for which the party seeking payment is responsible.

(h) Insurance, guaranties, or reinsurance 228 of a loan or equity investment of an eligible investor in a foreign bank, finance company, or other credit institution shall extend only to such loan or equity investment and not to any individual loan or equity investment made by such foreign bank, finance company, or other credit institution.

(i) Claims arising as a result of insurance, reinsurance 229 or guaranty operations under this title or under predecessor guaranty authority may be settled, and disputes arising as a result thereof may be arbitrated with the consent of the parties, on such terms and conditions as the Corporation may determine. Payment made pursuant to any such settlement, or as a result of an arbitration award, shall be final and conclusive notwithstanding any other provision of law.

(j) Each guaranty contract executed by such officer or officers as may be designated by the Board shall be conclusively presumed to be issued in compliance with the requirements of this Act.

225 The first sentence of subsec. (f) was amended and restated by sec. 6(a) of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1023). Previous amendments to this sentence in subsec. (f) which are retained in the new text include the following: The word "reinsurance" was added by sec. 2(4)(F) of Public Law 93-390; the basic language of clause (1) was added by sec. 5 of Public Law 95-268 (92 Stat. 215).

226 This sentence was added by sec. 2(4)(G) of the OPIC Amendments Act of 1974 (Public Law 93-390). The phrase "except that limitation shall not apply to direct insurance or reinsurance of loans by banks or other financial institutions to unrelated parties" was added by sec. 5 of Public Law 95-268 (92 Stat. 215).

A sentence, as added by sec. 2(4)(G) of Public Law 93-390 and which previously appeared at this point, was struck out by sec. 6(b) of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1023). It formerly read as follows: "The preceding sentence shall not apply to the extent not permitted by State law."

227 Subpara. (3) as added by sec. 6(b) of the OPIC Amendments Act of 1985 (Public Law 99

204).

228 Sec. 2(4)(I) of the OPIC Amendments Act of 1974 (Public Law 93-390) substituted the words ", guaranties, or reinsurance" in lieu of "or guaranties".

229 Sec. 2(4)J) of the OPIC Amendments Act of 1974 (Public Law 93-390) added the word ", reinsurance".

(k) 230 In making a determination to issue insurance, guaranties, or reinsurance under this title, the Corporation shall consider the possible adverse effect of the dollar investment under such insurance, guaranty, or reinsurance upon the balance of payments of the United States.

(1) 231 (1) No payment may be made under any insurance or reinsurance which is issued under this title on or after the date of enactment of this subsection 232 for any loss occurring with respect to a project, if the preponderant cause of such loss was an act by the investor seeking payment under this title, by a person possessing majority ownership and control of the investor at the time of the act, or by any agent of such investor or controlling person, and a court of the United States has entered a final judgment that such act constituted a violation under the Foreign Corrupt Practices Act of 1977.

(2) Not later than 120 days after the date of enactment of this subsection, 232 the Corporation shall adopt regulations setting forth appropriate conditions under which any person convicted under the Foreign Corrupt Practices Act of 1977 for an offense related to a project insured or otherwise supported by the Corporation shall be suspended, for a period of not more than five years, from eligibility to receive any insurance, reinsurance, guaranty, loan, or other financial support authorized by this title.

(m) 233 (1) Before finally providing insurance, reinsurance, guarantees, or financing under this title for any environmentally sensitive investment in connection with a project in a country, the Corporation shall notify appropriate government officials of that country of

(A) all guidelines and other standards adopted by the International Bank for Reconstruction and Development and any other international organization relating to the public health or safety or the environment which are applicable to the project; and

(B) to the maximum extent practicable, any restriction under any law of the United States relating to public health or safety or the environment that would apply to the project if the project were undertaken in the United States.

The notification under the preceding sentence shall include a summary of the guidelines, standards, and restrictions referred to in subparagraphs (A) and (B), and may include any environmental impact statement, assessment, review, or study prepared with respect to the investment pursuant to section 239(g).

(2) Before finally providing insurance, reinsurance, guarantees, or financing for any investment subject to paragraph (1), the Corporation shall take into account any comments it receives on the project involved.

230 Subsec. (k) was amended by sec. 2(4)(K) of the OPIC Amendments Act of 1974 (Public Law 93-390). It formerly read as follows: "(k) In making a determination to issue insurance or a guaranty under this title, the Corporation shall consider the possible adverse effect of the dollar investment under such insurance or guaranty upon the balance of payments of the United States".

231 Subsec. (1) was added by sec. 6 of Public Law 95-268 (92 Stat. 215).

232 Subsec. (1) became effective April 24, 1978.

233 Subsec. (m) was added by sec. 4(b) of the OPIC Amendments Act of 1985 (Public Law 99

(3) On or before September 30, 1986, the Corporation shall notify appropriate government officials of a country of the guidelines, standards, and legal restrictions described in paragraph (1) that apply to any project in that country

(A) which the Corporation identifies as potentially posing major hazards to public health and safety or the environment; and

(B) for which the Corporation provided insurance, reinsurance, guarantees, or financing under this title before the date of enactment of this subsection and which is in the Corporation's portfolio on that date.

Sec. 238.234 Definitions.-As used in this title

(a) the term "investment" includes any contribution or commitment 235 of funds, commodities, services, patents, processes, or techniques, in the form of (1) a loan or loans to an approved project, (2) the purchase of a share of ownership in any such project, (3) participation in royalties, earnings, or profits of any such project, and (4) the furnishing of commodities or services pursuant to a lease or other contract;

(b) the term "expropriation" includes, but is not limited to, any abrogation, repudiation, or impairment by a foreign government of its own contract with an investor with respect to a project, where such abrogation, repudiation, or impairment is not caused by the investor's own fault or misconduct, and materially adversely affects the continued operation of the project;

(c) the term "eligible investor" means: (1) United States citizens; (2) corporations, partnerships, or other associations including nonprofit associations, created under the laws of the United States any State or territory thereof, or the District of Columbia, 236 and substantially beneficially owned by United States citizens; and (3) foreign corporations, partnerships, or other associations wholly owned by one or more such United States citizens, corporations, partnerships, or other associations: Provided however, That the eligibility of such foreign corporation shall be determined without regard to any shares, in aggregate less than 5 per centum of the total issued and subscribed share capital, 237 held by other than the United States owners: Provided further, That in the case of any loan investment a final determination of eligibility may be made at the time the insurance or guaranty is issued; in all other cases, the investor must be eligible at the time a claim arises as well as the time the insurance or guaranty is issued; and

(d) the term "predecessor guaranty authority" means prior guaranty authorities (other than housing guaranty authorities) repealed by the Foreign Assistance Act of 1969, section 202(b) and 413(b) of the Mutual Security Act of 1954, as amended, and

234 22 U.S.C. 2198. Sec. 238 was added by sec. 105 of the FA Act of 1969.

235 The words "or commitment" were added by sec. 7 of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1024).

236 Reference to the District of Columbia was added by sec. 17(a) of the OPIC Amendments Act of 1985 (Public Law 99-204).

237 The words "required by Law to be", which appeared at this point were struck out by sec. 104(a) of the FA Act of 1971.

section 111(b)(3) of the Economic Cooperation Act of 1948, as amended (exclusive of authority relating to informational media guaranties).

Sec. 239.238 General Provisions and Powers.-(a) The Corporation shall have its principal office in the District of Columbia and shall be deemed, for purposes of venue in civil actions, to be resident thereof.

(b) The President shall transfer to the Corporation, at such time as he may determine, all obligations, assets and related rights and responsibilities arising out of, or related to, predecessor programs and authorities similar to those provided for in section 234 (a), (b), and (d). Until such transfer, the agency heretofore responsible for such predecessor programs shall continue to administer such assets and obligations, and such programs and activities authorized under this title as may be determined by the President.239, 240

(c) 241 (1) The Corporation shall be subject to the applicable provisions of chapter 91 of title 31, United States Code, except as otherwise provided in this title.

(2) An independent certified public accountant shall perform a financial and compliance audit of the financial statements of the Corporation at least once every three years, in accordance with generally accepted Government auditing standards for a financial and compliance audit, as issued by the Comptroller General. The independent certified public accountant shall report the results of such audit to the Board. The financial statements of the Corporation shall be presented in accordance with generally accepted accounting principles. These financial statements and the report of the accountant shall be included in a report which contains, to the extent applicable, the information identified in section 9106 of title 31, United States Code, and which the Corporation shall submit to the Congress not later than six and one-half months after the end of the last fiscal year covered by the audit. The General Accounting Office may review the audit conducted by the accountant and the report to the Congress in the manner and at such times as the General Accounting Office considers necessary.

(3) In lieu of the financial and compliance audit required by paragraph (2), the General Accounting Office shall, if the Office considers it necessary or upon the request of the Congress, audit the financial statements of the Corporation in the manner provided in paragraph (2). The Corporation shall reimburse the General Accounting Office for the full cost of any audit conducted under this paragraph.

(4) All books, accounts, financial records, reports, files, workpapers, and property belonging to or in use by the Corporation and the accountant who conducts the audit under paragraph (2), which

238 22 U.S.C. 2199. Sec. 239 was added by sec. 105 of the FA Act of 1969.

239 A Presidential Determination of Dec. 30, 1969, provided for AID administration until transfer to the Overseas Private Investment Corporation.

240 Sec. 7(1) of Public Law 95-268 (92 Stat. 215) struck out a paragraph previously appearing in subsec. (b) which had directed OPIC to cease operating the programs authorized by sec. 234 (b) through (e) and sec. 240 on Dec. 31, 1979.

241 Sec. 11 of the OPIC Amendments Act of 1985 (Public Law 99-204), substituted the text of subsec. (c) in lieu of:

"The Corporation shall be subject to the applicable provisions of the Government Corporation Control Act, except as otherwise provided in this title.'

are necessary for purposes of this subsection, shall be made available to the representatives of the General Accounting Office.

(d) To carry out the purposes of this title, the Corporation is authorized to adopt and use a corporate seal, which shall be judicially noticed; to sue and be sued in its corporate name; to adopt, amend, and repeal bylaws governing the conduct of its business and the performance of the powers and duties granted to or imposed upon it by law; to acquire, hold or dispose of, upon such terms and conditions as the Corporation may determine, any property, real, personal, or mixed, tangible or intangible, or any interest therein; to invest funds derived from fees and other revenues in obligations of the United States and to use the proceeds therefrom, including earnings and profits, as it shall deem appropriate; to indemnify directors, officers, employees and agents of the Corporation for liabilities and expenses incurred in connection with their Corporation activities; to require bonds of officers, employees, and agents and pay the premiums therefor; notwithstanding any other provision of law, to represent itself or to contract for representation in all legal and arbitral proceedings; to purchase, discount, rediscount, sell, and negotiate, with or without its endorsement or guaranty, and guarantee notes, participation certificates, and other evidence of indebtedness (provided that the Corporation shall not issue its own securities, except participation certificates for the purpose of carrying out section 231(c) or participation certificates as evidence of indebtedness held by the Corporation in connection with settlement of claims under section 237(i)); 242 to make and carry out such contracts and agreements as are necessary and advisable in the conduct of its business; to exercise the priority of the Government of the United States in collecting debts from bankrupt, insolvent, or decedents' estates; to determine the character of and the necessity for its obligations and expenditures, and the manner in which they shall be incurred, allowed, and paid, subject to provisions of law specifically applicable to Government corporations; to collect or compromise any obligations assigned to or held by the Corporation, including any legal or equitable rights accruing to the Corporation; 243 and to take such actions as may be necessary or appropriate to carry out the powers herein or hereafter specifically conferred upon it.

(e) The Inspector General 244 of the Agency for International Development (1) may conduct 245 reviews, investigations, and inspections of all phases of the Corporation's operations and activities and (2) shall conduct all security activities of the Corporation relating to personnel and the control of classified material. With respect to his responsibilities under this subsection, the Inspector General 244 shall report to the Board. The agency primarily responsible for administering part I shall be reimbursed by the Corporation for

242 The words to this point beginning with "or participation certificates sec. 7(2) of Public Law 95-268 (92 Stat. 215).

243 This phrase beginning with "to collect or compromise OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1024).

"

*

were added by

was added by sec. 8(1) of the

244 Reference to the Inspector General was substituted in lieu of a reference to the AuditorGeneral by sec. 8(2)(A) of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1024). 245 The words "may conduct" were substituted in lieu of the words "shall have the responsibility for planning and directing the execution of audits," by sec. 8(2)(B) of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1024).