3.2 Reporting mechanisms

Reporting systems have been developed in most bodies of the OECD. The three main reporting systems of the OECD will be described and the reporting mechanism of one body will be studied in detail, following the same method as for the United Nations Human Rights Treaties.

The reports to the Economic and Development Review Committee (EDRC), to the Development Assistance Committee (DAC) and to the Committee on Competition, Law and Policy (CCLP) are identified as the three main reporting procedures of the OECD. Once every 5 years an environmental analysis is also requested.²⁷

²⁷ By Mrs. Ballivet, OECD representative in Geneva.

The reporting procedures for these three Committees are similar. For each country, reports are prepared by three teams: the Secretariat of the OECD; the country itself; and the experts or examiners, who are people from two other countries designated to make a report on the third country. These three reports are combined into one report by a major economist of the OECD, and the combined report is then presented to the Committee, which discusses it and publishes a summary.

Usually two or three countries are treated by one major economist, aided by approximately 10 junior economists. Such a cluster of economists is called a desk. There are 12 desks for EDRC and 12 desks for DAC. CCLP works with heads of division and 7 major economists. There are many OECD experts who give advice on specific areas touched upon by the reports.

The EDRC monitors and assesses economic policies of individual countries on an annual basis. It is a multilateral surveillance process covering both macroeconomic and microeconomic policy issues. This annual examination is the main instrument for the Organization’s surveillance of overall economic policies in each member country. Special issues in specific countries are also reviewed. Exceptionally, surveys of Non-Member States are conducted, e.g., when such countries wish to become OECD members. The reports are published in the OECD Economic Surveys. In 1994, 8 surveys were published, in 1993, there were 15, making 23 in all, those for Belgium and Luxembourg being published together. Surveys were also published of “Partners in Transition”: for Poland in 1992; Hungary in 1993 and the Czech and Slovak Republics in 1994. A non-member survey was also made of Mexico in 1992, before Mexico became a full member of the OECD.

In the Committee, questions can be asked on the functioning of different economic systems in a country. For example, Switzerland is always asked to explain its financial system.

Once every two years a Member State has to report to the CCLP. This Committee reviews developments in competition policy, law and jurisprudence in OECD member countries at each of its semi-annual meetings. During 1989/90 and 1990/91, 20 and 19 reports, respectively, were reviewed. The country reports are made available to the public by the individual governments. The summary is made available to the public on the authority of the Secretary-General of the OECD.

Every 2 years, the DAC reviews the quantity and quality of development aid given by a country to other countries. There are no fixed dates of publication and there is no list of reports that have been published. This makes it impossible, at present, to give more details on this reporting procedure.

The reporting mechanism of the Financial Action Task Force (FATF) will be examined in detail. The FATF is not a real OECD body, but was established by the G7 Economic Summit in Paris in 1989. It consists of representatives of States that are interested in decisive action against the drug problem and that therefore wish to examine measures to combat money laundering. The secretariat is provided by the OECD, though not all members of the FATF are OECD members.

In April 1990, the FATF issued a report with 40 Recommendations. Evaluation of the progress made by FATF members in implementing the 40 Recommendations is the only area relevant to this paper of the three main areas of work on which the Task Force has focused its attention. The Task Force monitors the performance of its members using two methods of reporting, agreed in 1991: annual self-assessment by member countries, and a mutual evaluation process.

Self-assessment by member countries is conducted on the basis of questionnaires dealing with the Recommendations on legal and financial matters. These questionnaires have become specific and detailed, inviting countries to supply appropriate narrative information. Most members take the opportunity to do so. The FATF Secretariat draws up two grids of the responses, showing the state of implementation of the Recommendations. These results are then discussed in working groups. Although there inevitably remain some differences in interpretation of some of the questions, the exercise now provides a generally objective analysis of the performance of members in implementing the 40 Recommendations.

The mutual examination process has already examined 12 countries. The goal is to examine each member once, over the period 1991-1994. The procedure is as follows: the chairman of the FATF selects the FATF members to be examined in the coming year. In consultation with the country to be examined, the Chairman of the FATF selects at least three examiners (country representatives), taking into account the expertise and the background of the examiners and their countries. Each evaluation team should include examiners from at least two different countries.

First, all relevant quantitative and qualitative information is assembled and processed in an analytical assessment, in order to secure an objective assessment of the situation in a given country. This is achieved on the basis of the information provided by the examined country itself, through its response to a comprehensive and standardized mutual evaluation questionnaire. The information-gathering process is completed through a variety of interviews carried out by the examiners during an on-site visit. Subsequently, the Secretariat is in a position to write a confidential draft report in the light of the examiners’ assessments and under their-responsibility.

The draft report contains a tentative evaluation, which is submitted to the examined country, and then discussed in a joint meeting of the legal and financial working groups. The examiners present their report to the joint group, and other FATF members are selected to lead the discussion. The purpose of this phase is to verify the validity of the facts and the state of implementation. This intensive peer review is a necessary means for reaching a clear and unbiased assessment of where the country stands and of the areas in which further efforts are warranted. The report is then revised as necessary by the Secretariat in the light of these discussions, and the conclusions are reflected in the final report, to be approved by the FATF plenary. The report itself remains confidential, but an executive summary thereof is prepared and included in the annual report of the FATF.

This is the reporting mechanism for the FATF. To preserve the informality of the FATF, membership will not be increased.