AIIB Under International Law
The Asian Infrastructure Investment Bank (AIIB) is an international organization established by the AIIB Articles of Agreement (entered into force Dec. 25, 2015), a multilateral treaty, the Parties to which comprise the Membership of the Bank. Accordingly, AIIB is both constituted and governed by public international law, the sources of which include applicable international conventions, customary international law, general principles of law and subsidiary means for the determination of rules of law.
Notwithstanding its international legal personality independent of that of its Members, AIIB, unlike States, does not possess general competence. In other words, it may only exercise those powers expressly or impliedly bestowed upon it by the Articles of Agreement. In the furtherance of AIIB’s mandate, internal legislation is issued by the governance organs of AIIB, deriving its effect from the Articles of Agreement. The resulting organization and effect of such legislation is established by AIIB’s Internal Legal Framework.
Internal Legal Framework
AIIB’s Internal Legal Framework legally and logically arises from the Articles of Agreement and the roles and competence attributed to the Board of Governors, the Board of Directors and the President. It responds to the authority of the Board of Governors to adopt rules and regulations, and the power of the Board of Directors to establish Policies and adopt the Staff Regulations. It is also established in accordance with the generally recognized principles of international administrative law which derive from public international law which governs AIIB.
Together, this forms a governance hierarchy, ordering the Board of Governors highest, with the Board of Directors subject to the Board of Governors, and in turn the Board of Directors may direct the President. However, the Articles of Agreement specify that the President is, independently of both Governors and Directors, the chief of staff and legal representative of AIIB. As such, the President may add to the Policies and Staff Regulations issued by the Board, but not detract from them or alter them.
Therefore, within AIIB, the Board of Governors adopts the Codes of Conduct for Bank Personnel and Board Officials, the Board of Directors adopts all Policies as well as the Staff Regulations. The President adopts Directives and the Staff Rules. Directives may implement Policies, but they may sometimes be standalone initiatives of the President. Directives and Staff Rules may be complemented by Administrative Guidance issued under the delegated authority of the President.
In accordance with Article 30(2) of the Articles of Agreement, the Staff Regulations adopted by the Board of Directors set forth the fundamental conditions of service and the basic rights, duties and obligations of AIIB and its staff. These establish the broad policies in accordance with which the President shall organize and manage AIIB staff.
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AIIB’s Policy on Compensation and Benefits, approved by the Board of Directors, establishes the fundamental objectives and terms of the compensation, allowances, benefits and retirement plan of the staff of AIIB. AIIB is guided by a concept of total rewards, aggregating the total value of compensation, other financial and non-monetary rewards, to ensure alignment with AIIB’s purpose and functions.
Policy on Compensation and Benefits
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The Staff Rules are adopted by the President and prescribe the legal employment rights of AIIB staff. The Staff Rules, together with the Staff Regulations, form the essential employment law of the AIIB. This is complemented by individual contractual provisions as well as application of the generally recognized principles of international administrative law.
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Directives are binding instructions issued by the President to AIIB staff. They may also serve to delegate authority and attribute responsibilities. Directives may implement a Policy adopted by the Board of Directors are be standalone. They are one of the ways in which the President, as chief of staff, ensures the staff of the AIIB work together in a coordinated, efficient, confident way that leads to high-performance and institutional success. Some key points:
- Directives are issued by the President (following deliberation by the Executive Committee).
- Directives are binding rules, enabling provisions and delegations of authority and responsibility.
- Staff Members who disregard a Directive are disregarding the President’s authority as chief of staff and so will likely be acting contrary to the terms of the Code of Conduct for Bank Personnel.
- For these reasons, the content of Directives is intended to be precise, specify what is to be done and by whom, and provide no more binding rules than are strictly necessary.
Directives and Staff Rules are usually supported by Administrative Guidance (AG). AG may contain written administrative practices, forms and details, which AIIB staff should follow because it is essential for superior performance. AG is issued by Vice Presidents and other Heads of Department reporting directly to the President. AG can be updated and changed as often as needed. AG cannot, however, revise, amend or contradict any Policy, Staff Regulation, Directive or Staff Rule. In order to ensure the functional integrity of the AIIB, AG is not made public.
AIIB 2018 Law Lecture
Professor Georg Nolte, Chair of the International Law Commission of the United Nations (69th Session, 2017/2018), delivered the 2018 AIIB Law Lecture on the subject of International Organizations in the Recent Work of the International Law Commission to conclude the conference. He addressed an audience of international lawyers, academics, Beijing-based graduate law students and Bank staff.
AIIB 2018 Legal Conference
The AIIB 2018 Legal Conference was held under the theme “International Organizations and the Promotion of Effective Dispute Resolution.” As legal entities and global actors, international organizations are sustained by the rule of law, in place of the hinterland of states, and the effectiveness of international organizations is aligned with the efficient interaction of the laws which enable them to exist and to act. The lawful effective resolution of disputes is therefore the central concern to all international organizations.
As with last years’ inaugural AIIB Legal Conference, attendees included senior lawyers from other international organizations along with senior academics, arbitration and other practitioners as well as AIIB Senior Management. From Academia: William T. Loris, Director, Rule of Law for Development Institute, Loyola University Chicago & former Director-General, International Development Law Organization; Stavros Brekoulakis, Professor of International Arbitration and Commercial Law, Queen Mary University of London & Editor, International Journal of Arbitration, Mediation and Dispute Resolution; Malik Dahlan, Professor of International Law and Public Policy, Queen Mary University of London; Asif Qureshi, Professor of International Economic Law, Korea University; Locknie Hsu, Professor of Law, Singapore Management University; Kristina Daugirdas, Professor of Law, University of Michigan; Wenwen Liang, School of Law Lecturer, Wuhan University. From International Financial Institutions: Andreas Baumgartner, Executive Director, Dubai International Financial Centre, Dispute Resolution Authority; Marie-Anne Birken, General Counsel, European Bank for Reconstruction and Development; Ramit Nagpal, Deputy General Counsel, Asian Development Bank; Gonzalo Flores, Deputy Secretary-General, International Centre for the Settlement of Investment Disputes Secretariat; Frits Bontekoe, Legal Counsel, World Intellectual Property Organization; Heikki Cantell, General Counsel, Nordic Investment Bank; Diego Devos, General Counsel, Bank for International Settlements. From Arbitration Institutions: Cavinder Bull SC, Vice President of the Singapore International Arbitration Centre, Court of Arbitration; Jackie van Haersolte-van Hof, Director-General, London Court of International Arbitration; Alexander G. Fessas, Secretary-General, ICC International Court of Arbitration; Matthew Gearing QC, Chair, Hong Kong International Arbitration Centre; Jingzhou Tao, Managing Partner, Asia, Dechert LLP & Member, Advisory Committee of China International Economic and Trade Arbitration Commission; Hugo Hans Siblesz, Secretary-General, Permanent Court of Arbitration.
AIIB Yearbook of International Law
The AIIB Yearbook of International Law (AYIL), published by Brill, draws upon the dialogues begun at the AIIB Legal Conferences combining expertise from other international organizations, international law practitioners and eminent academics. Divided into several parts to reflect a series of overarching themes and includes the AIIB Law Lecture. AYIL is launched at the Annual Meeting of the AIIB’s Board of Governors.