Board of Directors European Bank for Reconstruction ... - Article 19

Board of DirectorsEuropean Bank for Reconstruction and DevelopmentLondon, United Kingdom20 February 2006Dear Executive Directors,We are writing regarding the European Bank for Reconstruction and Development’s (EBRD)upcoming review of its Public Information Policy (PIP). We understand that the Board Financialand Operations Policies Committee (FOPC) will soon be receiving a new draft PIP for reviewand, upon their approval, the draft will be released for public comment. The GlobalTransparency Initiative (GTI) encourages the EBRD to base its draft PIP on the Right toInformation, according to which a true presumption of disclosure, subject only to a narrowregime of exceptions, is established.This letter sets out the GTI’s main priorities in relationship to this recommendation, as well asour specific comments on the proactive disclosure of information relating to the project cycle andCountry Strategies.The Right to InformationThe right to access information held by the IFIs is a fundamental human right which appliesregardless of the source of the information (who produced the document) and whether theinformation relates to a public or private sector actor. There are four main elements in a policybased on the right to information, as well as the general obligation to disclose on a proactivebasis, even in the absence of a request, the subject of the second part of this letter. Thesestandards are set out in far greater detail in the GTI IFI Transparency Charter. 1First, and central to the right to information, is a genuine presumption of disclosure, accordingto which all information held by the Bank should be subject to disclosure upon request, subjectonly to a regime of narrowly-defined exceptions providing justification for withholding certaininformation. This list should be explicit, indicating the precise harm that would result fromdisclosure.1 This is available in several languages on the GTI website, http://www.ifitransparency.org.

Global Transparency Initiative 20 February 2006Second, the policy should provide for clear procedures by which requests for information willbe processed. These should include, among other things, clear timelines for responding torequests, rules relating to any charges for providing information and a requirement to providewritten reasons for any refusals to provide information.Third, the policy should set out a clear, narrow and exclusive list of exceptions to the right ofaccess. Exceptions should be clear and as narrow as possible, and based on a harm test. Forexample, the exception for “business confidentiality” should clearly define the types ofcommercially-sensitive information that cannot be disclosed, such as trade secrets or informationthat would harm the competitive position of the party that supplied the information. Broadexceptions which do not specify a specific harm, such as information relating to the “deliberativeprocess” or “all correspondence”, should be avoided. The current PIP includes some exceptionsthat do not conform to this best practice approach. For example, the PIP exempts “informationin the Bank’s possession which was not created by the Bank and is identified by its originator asbeing sensitive and confidential”. This does not require any harm and could cover any and allinformation submitted to the Bank by public or private sector project sponsors. All exceptionsshould be reviewed to ensure that they focus on the “harm” that would be caused by disclosure,rather than just exempting particular categories of information.Exceptions should also be subject to a public interest override so that, where relevant andconsidering all of the circumstances, information will be released despite a risk of harm to alegitimate interest, where this serves the overall public interest. This might be the case, forexample, where the information discloses a severe environmental risk or evidence of corruption.A fourth key element of the presumption in favor of disclosure is a right to appeal against nonapplicationof the policy, so that anyone who believes that the EBRD has failed to respect thePIP, including through a refusal to provide information in response to a request, should have theright to have the matter reviewed by an independent and authoritative body.Provisions for appeals and a public interest override are increasingly being recognized by otherInternational Financial Institutions (IFIs). Notably, the Asian Development Bank (ADB), in its2005 Public Communications Policy, has established an internal body to review publiccomplaints related to disclosure policy implementation. While lacking the independencecommonly found in appeals bodies which deal with national information disclosure laws, theADB’s process at least includes clear timelines regarding responses to appeals, an obligation toexplain the decision taken, and the public disclosure of these appeals, including the nature of anddecision on the appeal.The IFC is also considering an internal appeals provision in its draft disclosure policy, currentlyunder review. The IFC has built into its draft policy an “exceptional circumstances” provisionthat allows for a public interest override when disclosure of normally confidential information“would be likely to avert imminent and serious harm to the public health or safety, and/orimminent and significant adverse impacts on the environment.” 22 IFC Draft Policy on Disclosure of Information, September 2005, p. 4.2

Global Transparency Initiative 20 February 2006At a minimum, the EBRD should incorporate an appeals process and public interest overrideprovision similar to those at the ADB and IFC in its new draft PIP.Routine DisclosureWhile information should be available upon request according to a presumption in favor ofdisclosure as described above, certain important information which is regularly produced andcommonly requested should also be proactively disclosed, via the Bank’s local offices and itswebsite.Such disclosure should include a wide range of information about EBRD structure, policies andprocedures, decision-making processes, and country and project work. This information shouldbe made available in a timely fashion and in a language and via a medium that ensures thatinterested stakeholders can effectively access it.An important aspect of routine disclosure is timely disclosure, in which information held by theBank or project sponsor is made available to stakeholders within a specified framework. Anytimeline should be designed to ensure that the information is released in time to be of use, forexample, before final decisions on a project, policy or strategy are made, such that stakeholderscan engage with Bank-financed operations throughout the project cycle and Country Strategies inan effective and informed fashion.1. Project InformationAccess to EBRD documents produced during the project cycle remains limited. While thecurrent PIP requires the disclosure of Project Summary Documents and Environmental Annexesfor both public and private sector operations, the majority of project-specific informationremains confidential.In an effort to disclose information routinely, the EBRD should make the revisions describedbelow to the PIP to address the lack of transparency surrounding all phases of the project cycle.While the disclosure of relevant environmental and social documents is covered under the scopeof the Bank’s Environmental Policy, the PIP should be revised to include theserecommendations, reinforcing a true presumption in favor of disclosure and making the PIP acomprehensive guide to disclosure within the EBRD.In order to provide routine access to information, the EBRD should establish an Internetbasedmechanism for tracking project status and project-related information, similar to thatof the World Bank. The mechanism would bring together relevant project information anddocuments in all phases of the lending cycle and make these documents readily available throughan updated and searchable database.To effectively engage with EBRD-financed projects, citizens need to have access toenvironmental and social documents under consideration during the project’s early appraisalphase. The EBRD should publicly disclose initial discussion papers at the time suchdocuments are produced, including the Concept Clearance Memorandum, Concept Review3

Global Transparency Initiative 20 February 2006Memorandum, Initial Environmental Examinations, Final Review Memorandum, and duediligence requirements for Financial Intermediaries. While some of this information is disclosedin Environmental Summaries (ES) attached to Project Summary Documents (PSDs), thisinformation is neither disclosed in its entirety nor in a timely fashion for effective publicinvolvement. The EBRD should also require the project sponsor to release environmental andsocial documents they hold, at the time such documents are produced. This includes, but is notlimited to environmental and social documents that project sponsors and consultants generate atthe request of EBRD pursuant to the Bank’s due diligence process.Although we welcome the disclosure of PSDs for public sector projects “as soon as possible afterthe project has passed its Initial Review by Bank management,” 3 private sector PSDs aredisclosed only 30 days prior to Board consideration. In line with timely, routine disclosure, theBank should disclose public and private sector PSDs immediately after Initial Review andnot less than 60 days prior to Board review.We recommend that EBRD take a more proactive role in initiating a genuine presumption infavor of disclosure upon project approval. The EBRD should disclose all documents relatedto the loan agreements between the EBRD and the project sponsor, including theEnvironmental Action Plan and loan contract.Once a project is approved, the EBRD should routinely and publicly disclose allimplementation and supervision documents produced by the Bank or project sponsor.Public disclosure of these documents allows affected communities to hold both the EBRD andprivate and public sector actors accountable for commitments made during project design. TheEBRD should, where applicable, release project monitoring reports, including annualenvironmental reports, environmental consultants’ reports, periodic environmental audits,environmental performance ratings, exit audits and site-visit reports. The EBRD should alsorequire project sponsors to disclose these reports to locally affected people. The ADB hasalready implemented such a rule- the disclosure of social and environmental monitoring reportsfor public and private sector projects- in its Public Communications Policy. 4The public should have access to information documenting any unexpected impacts on the healthand safety of local communities and ecosystems associated with the project. Therefore, accidentreports should become publicly available upon their submission to the Bank.In order to engage as an equal partner in lessons learned from Bank-financed developmentprojects, the public should also have access to EBRD project evaluations and assessments. TheBank should disclose full reports of the Project Evaluations Department, includingOperation and Performance Evaluation Reports, at the time of their submission to theBoard for approval.3 EBRD Public Information Policy, July 2003, p. 8.4 ADB Public Communications Policy 2005, Paragraph 92.4

Global Transparency Initiative 20 February 20062. Country StrategiesWe welcome EBRD’s efforts to consult with stakeholders in the early phases of CountryStrategy preparation and to provide translations into local languages, on a pilot basis, ofapproved strategies.However, while the current PIP solicits public comments based on existing Country Strategiesand an accompanying management note that outlines “the main areas to be focused upon in theReview,” the PIP does not require the disclosure of draft Country Strategies or EBRDevaluations of previous Country Strategies on which the public is consulted. Furthermore,current PIP requirements regarding public consultation practices require neither the disclosure ofdraft Country Strategies in relevant local languages nor notification of the public aboutupcoming consultations.The disclosure of draft Country Strategies and institutional evaluations of previous countrystrategies is becoming a minimum transparency requirement at other institutions. In the last twoyears, both the ADB and the African Development Bank have adopted policies requiring thedisclosure of draft country strategies prior to formal management and Board discussions on thesestrategies, which include time-bound consultation procedures. Further, both the ADB and theWorld Bank now disclose institutional evaluations of previous country strategies prior toreviewing a strategy. To remain on par with these regional development banks and establish theBank as a leader in transparency standards, the EBRD should publicly disclose:• Draft Country Strategies in relevant local and national languages prior to initiating aCountry Strategy Review.• Specific timelines and procedures regarding the extent and nature of the publicconsultations regarding Country Strategy reviews, including post and email notifications,in relevant local languages, of upcoming consultations. While the EBRD follows theseprocedures for some countries, the Bank should require these procedures for all countries.• All public comments received during consultations in their original form, andmanagement responses to such comments, at the time of submission to the ExecutiveCommittee and Directors. If management does not incorporate public comments into theFinal draft Country Strategy, an explanation for this should be made public. As the Bankhas begun doing this in some instances, this recommendation should be incorporated aspolicy in the revised PIP.• Final draft Country Strategies at the same time that they are distributed to the Board ofDirectors for consideration.• Board deliberations regarding the final draft Country Strategies.• Action plans for Country Strategy implementation. These should be disclosed uponapproval of Country Strategies and offered for public consultation.Further, we recommend that the EBRD adopt a more systematic approach to elaborating andpublishing Country Strategy Evaluations. The Country Strategy Evaluations should be carriedout on regular basis and disclosed after Board approval.5

Global Transparency Initiative 20 February 2006We appreciate your attention and look forward to incorporation of our suggestions into therevised draft PIP. We also welcome the opportunity to comment more extensively when the draftis released.Any questions, comments, or responses may be directed to Jennifer Kalafut(jkalafut@bicusa.org) or David Hoffman (dhoffman@bicusa.org) at Bank Information Center.Sincerely,Global Transparency Initiative Steering Committee:Access to Information Network (ATIN), PhilippinesARTICLE 19, United KingdomBank Information Center, United StatesBretton Woods Project, United KingdomCEE Bankwatch Network, Czech Republicfreedominfo.org, United StatesInstitute for Democracy in South Africa (IDASA), South AfricaLibertad de Información-México AC (LIMAC), MexicoCc:Mr. Jean Lemierre, President, EBRDMr. Paul Martin, Principle Advisor and Financial and Operations Policies Committee (FOPC)Secretary, EBRDMr. Horst Reichenbach, Secretary General, EBRDThe Global Transparency Initiative (GTI) is a network of civil society organisations promotingopenness in the International Financial Institutions (IFIs), such as the World Bank, the IMF, theEuropean Investment Bank and Regional Development Banks. The GTI brings together twocommunities of activists and experts from around the world - one, those groups campaigning forfull accountability in the use of public power vested in the IFIs; the other, groups that have beencampaigning for the right to access to information at the nation-state level.For more information about the GTI, go to: www.ifitransparency.org.6