ARTICLES OF ASSOCIATION
1. Name
This organization shall be called the International Bankers Association (“I.B.A.” or the “Association”).
2. Objectives, Purposes and Standards
a. Objectives and Purposes
The objectives and purposes of the I.B.A. are:
(i) to act as a clearinghouse for the exchange of ideas and information, and thereby to promote greater cooperation among foreign Financial Groups, Commercial Banks, Securities Companies, and Bank and Securities Company Representative Offices in Japan;
(ii) to represent the common interests and issues of its members (“Members”) in relation to all aspects of their business in Japan,
(iii) to provide a vehicle for placing before the Government of Japan and other organizations that seek to influence the financial services industry the views of its members regarding issues affecting their business;
(iv) to conduct research and disseminate information to its members in connection therewith; and
(v) to make available the collective knowledge and experience of member firms by way of representations to such organizations, and, for this purpose, to gain representation for the I.B.A. on committees, governmental or otherwise, which shall attempt to influence the Industry.
Such purposes, however, will not include acting as a self-regulatory or similar organization for the financial services industry or any segment thereof.
b. Member Standards
Members understand that effective advocacy must balance member self-interest with responsibility for the public interest. Thus, members recognize their central role in the growth and development of the banking and capital markets in Japan, as well as their responsibility to clients, issuers and investors. The values of I.B.A. members include:
(i) adherence to the highest ethical, professional and regulatory standards;
(ii) commitment to represent the best interests of the client; and
(iii) unquestioned integrity in all business and industry dealings.
Members uphold these values through responsible management; superior products and services; professional education for employees; and clear, consistent and complete information for clients about products, services, and the risks and rewards associated with the banking and capital markets.
3. Offices
The Offices of the I.B.A. shall be in Tokyo, Japan, at such place as the Executive Committee may from time to time designate.
4. Membership
The General Membership shall consist of Members, with such dues and with such rights and responsibilities as the Executive Committee may from time to time determine appropriate.
Members:
Membership shall be limited to corporations which meet the following criteria:
(a) a financial group engaged in both commercial banking and securities operations in Japan (i) both of which are duly registered or licensed in Japan; and (ii) is a firm the majority of whose ownership is outside Japan (each such member, a “Financial Group Member”);
(b) a commercial bank, duly registered and licensed in Japan, the majority of whose ownership is outside Japan (each such member, a “Commercial Bank Member”);
(c) a securities firm, duly registered and licensed in Japan, the majority of whose ownership is outside Japan (each such member, a “Securities Firm Member”); and
(d) a representative office of a commercial bank or securities firm which is not engaged in any transactional activity in Japan and the majority of whose ownership is outside Japan (each such member, a “Representative Office Member”).
Each Member shall designate a senior executive officer, and agent, to serve as the representative of the Member to the Association, including representation at the Annual General Meeting. All employees of the Member shall be eligible to participate in committee activities.
Advisors:
Advisors are not members of the I.B.A. This group shall be composed of applicant corporations or partnerships admitted under criteria set by the Executive Committee, and which shall either be a provider of accounting, consulting, information technology, legal or other professional services to banking or capital markets as a regular and important part of its business.
Each Advisor, whether corporation or partnership, shall be required to observe a strict prohibition against self-promotion. Rather than self-promotion, each Advisor is expected to contribute its knowledge, expertise and experience for the positive development of banking and capital markets in Japan.
5. Admission, withdrawal and dissolution/transfer
Any organization seeking to become a member of the Association shall apply to the Executive Director, who will thereafter forward the application to the Vice Chairman, Member Services, and to the Executive Committee. The applicant shall become a Member upon the approval of the Executive Committee and after receipt of all relevant subscription fees. Mutatis mutandis, notwithstanding that Advisors are not members of the I.B.A., in sections 5 and 6 of the Articles of Association, the term “Members” applies to Advisors.
A Member may withdraw at any time by giving written notice to that effect to the Executive Director.
Membership shall lapse if the Member’s organization terminates its business in Japan, or if the Member fails to pay the annual subscription within one month of the due date for renewal.
Any Member may be suspended or expelled by the Executive Committee if the member ceases to meet the qualifications for membership set forth in Section 4 above, or if it shall commit any act detrimental to the interests of the I.B.A.
No suspension of a Member may take place unless another Member files a formal complaint, in writing and containing specific allegations, with the Vice Chairman, Member Services.. Upon receipt of such filing, the Vice Chairman shall investigate the facts as he/she deems appropriate and prepare and distribute a report to the Executive Committee. An affirmative vote of three-fourths (3/4) of the members of the Executive Committee shall be required to effect the suspension or expulsion of a member. Such suspension shall become effective immediately following such affirmative vote. At least fifteen (15) days prior to the Executive Committee meeting at which such suspension or expulsion is to be considered, the Member shall be furnished a written statement of the allegations and shall be provided an opportunity for a hearing thereon.
A Member which is suspended from membership shall not enjoy any of the rights and privileges of membership during the period of such suspension, and a member which is expelled from membership shall forfeit all rights and privileges of membership immediately upon the effectiveness of such expulsion.
Members terminating their membership shall not be eligible for a refund of either the Membership Fee or Committee Dues, and shall have no subsequent claim on the assets of the I.B.A. Members changing their membership classification as a result of merger or acquisition will be required to notify the I.B.A. of said change and the successor Member may be permitted to recalculate its Membership Fee and Committee Dues, pro-rated for the remainder of the Membership Year.
If the I.B.A. is dissolved, any remaining assets of the Association shall be distributed either to a new Association or among the Members still holding membership at the time of dissolution as determined by the Executive Committee. The amount due to each Member shall be calculated on a pro rata basis in relation to the total sum of their subscriptions during the three years preceding the order for dissolution.
6. Membership Fees and Committee Dues
All Members and Advisors shall be required to pay an annual subscription fee (the “Membership Fee”) as determined by the Executive Committee, and approved annually by the general membership, to meet expenses of the Association. The Membership Fee will cover one calendar year from 1st October to 30th September (the “membership year”). The Membership Fee will be applied as a fixed or a proportional amount, or combination of both, using a methodology approved by the Executive Committee.
Each Member or Advisor may be required to pay, on demand, such additional amounts, as may be determined by the Executive Committee, to meet unanticipated expenses of the Association. Any additional funding request exceeding 25% per annum of an annual Membership Fee shall require approval of the Membership.
Eligible Sector Committee members may be required to pay Sector Committee Dues, if such dues are requested by a Sector Committee and approved by the Executive Committee. Sector Committee Dues will be levied using a methodology approved by the Sector Committee membership and the Executive Committee. The Dues will be used to cover the direct and allocated costs of the Sector Committee as budgeted and reviewed by the Office of the Chairman, the Sector Committee Chairmen and the Executive Director.
Within a given fiscal year, requests for funding by a Sector Committee, over and above its original budget, shall require Executive Committee approval only. All approved fees shall be payable by the Members within thirty (30) days thereafter.
New Members admitted to membership during a membership year and Members changing their classification (e.g., as a result of merger or acquisition) shall pay a pro-rata share of the Membership Fee and of any applicable Committee Dues, calculated using an actual/12 month year, and payable within thirty (30) days from the date of their admission to membership or the date of the Annual General Meeting of the I.B.A., whichever is later.
Subscription fees shall cover administrative costs of the I.B.A. However, certain special services or activities organized by the I.B.A., as designated from time to time by the Executive Committee, may be offered on either an ‘at-cost’ or a ‘for-profit’ basis. The Vice Chairman (Finance and Administration) will approve policies and procedures to ensure that charges are reasonable and reflect the interests of members.
7. Organization & Officers
A. The Executive Committee
There shall be an Executive Committee of at least nine and no more than eighteen Members, who shall be elected by the Members of the I.B.A. at the Annual General Meeting, and hold office as Members of the Executive Committee for a term of two years. Terms shall be staggered, to the extent possible, so that approximately half the Executive Committee will be elected each year. All Executive Committee Members shall be CEOs or senior executives of their respective Firms. Membership in the Executive Committee shall be held on an institutional basis. Representatives who assume an institution’s seat on the Executive Committee shall be subject to approval of a majority of the Executive Committee. Advisors are not permitted to become members of any committee, including the Banking Sector Committee and the Securities Sector Committee. A newly-elected Chairman of the Banking Sector Committee or the Securities Sector Committee shall automatically be made a member of the Executive Committee, if he/she is not already a member. In such a case (i) the maximum number of seats on the Executive Committee (eighteen) may be exceeded; and (ii) a member firm may have two representatives on the Executive Committee.
The governance of the Association shall be determined by the Executive Committee, which shall have all the powers expressly conferred by these Articles of Association. The day-to-day affairs of the Association shall be managed by the Executive Director, subject to the oversight of the Executive Committee. The day-to-day procedures for the conduct of the activities of the Association and its Executive Committee may be set forth in By-Laws of the Association established from time-to-time by an affirmative resolution of two-thirds (2/3) or more of the members of the Executive Committee.
When an Executive Committee vacancy arises, the Office of the Chairman shall solicit nominations and propose new Members to the Executive Committee. The Office of the Chairman shall be guided in its selection by a need to balance the various interests of the Members. The appointment of the Executive Committee shall be subject to confirmation by a vote of the Members at the Annual General Meeting.
A retiring Executive Committee member may be re-elected to the same office in subsequent years including that immediately succeeding his/her term.
A member of the Executive Committee shall automatically cease to hold such office on his/her employer ceasing to be a member of the Association for any reason.
Depending on the number of then existing places on the Executive Committee, the Office of the Chairman shall nominate candidates, and the Members shall endeavor to elect a Committee such that approximately one-third (1/3) of the positions on the Executive Committee shall be filled by representatives of Financial Group Members, one-third (1/3) by representatives of Commercial Bank Members and one-third (1/3) by representatives of Securities Firm Members. To the extent that a Representative Office Member is not included in the above, the Vice Chairman for Member Services will be responsible for representing the interests of Representative Office Members. The Executive Committee shall have the authority to establish Sector Committees, Standing Committees and Ad Hoc Committees and may delegate to such committees any of the authority vested in the Executive Committee, other than admission of new Members or termination of existing Members.
The Executive Committee may from time to time employ I.B.A. staff who shall have such functions, and may be paid such remuneration, and be employed on such other terms and conditions as the Executive Committee may from time to time decide, and who shall report to the Office of the Chairman, unless otherwise agreed by the Executive Committee, on all matters pertaining to their functions.
B. Office of the Chairman
The Members of the I.B.A. shall, at every Annual General Meeting of the I.B.A., elect a Chairman and two Vice-Chairmen who shall form the “Office of the Chairman,” from representatives of Members who have been elected or re-elected to sit on the Executive Committee. At least one member of the “Office of the Chairman” shall be a representative of a Commercial Bank and at least one shall be a representative of a Securities Firm.
A retiring Chairman or Vice-Chairman may be re-elected to the same office in subsequent years.
In the interpretation of the Articles of Association, the decision of the Office of the Chairman shall be conclusive.
In the event that the Chairman shall resign from such office, or cease to be a member of the Executive Committee, the Executive Committee shall appoint one of the Vice Chairmen, or if neither of the Vice Chairmen is willing to accept such appointment, then any other member of the Executive Committee, to hold office as Chairman until the next Annual General Meeting.
In the event that a Vice Chairman shall resign from such office, or cease to be a member of the Executive Committee, the Executive Committee may appoint any other member of the Executive Committee to hold such office until the next Annual General Meeting.
The Chairman and the two Vice Chairmen, individually, shall represent the Members of the I.B.A. in all matters for which they are directed to do so by the Executive Committee.
i) The Chairman
The Chairman shall preside at all meetings of the I.B.A. Executive Committee and shall generally supervise the management of the affairs of the I.B.A., subject to such directions as the I.B.A. or the Executive Committee may give, and shall discharge such other functions as the I.B.A. or the Executive Committee may from time to time entrust to him/her.
ii) Vice Chairman, Member Services
One of the Vice Chairmen elected shall be nominated by the Executive Committee to oversee the Association’s services to members, and to act as deputy to the Chairman.
iii) Vice Chairman, Finance and Administration
One of the Vice Chairmen elected shall be nominated by the Executive Committee to oversee the Association’s finances and administration, and to act as deputy to the Chairman in the absence of the Vice Chairman, Member Services.
C. Executive Director
The Executive Committee will appoint an Executive Director who shall have such functions, and may be paid such remuneration, and be employed on such terms and conditions as the Executive Committee may from time to time decide, and who shall report directly to the Office of the Chairman on all matters pertaining to his/her functions.
The Executive Director shall be required to attend all membership meetings of the I.B.A. and of the Executive Committee, and shall be responsible for the taking, writing and distribution of the minutes of such meetings.
D. Sector Committees and Ad Hoc Committees
Any I.B.A Member shall be entitled to the rights of observer at any Sector Committee to which it belongs.
Sector Committees:
At the request of a majority of the Commercial Bank Members, the Executive Committee shall form a Banking Sector Committee. At the request of a majority of the Securities Firm Members, the Executive Committee shall form a Securities Sector Committee. At the request of a majority of any other segment of the financial services industry that the Executive Committee deems appropriate for separate representation, the Executive Committee may form a sector committee (each of such committees to constitute a “Sector Committee”).
The members of the Banking Sector Committee shall be composed of eligible senior executives from eligible Commercial Bank Members and Financial Group Members.
The members of the Securities Sector Committee shall be composed of senior executives from eligible Securities Firm Members and Financial Group Members.
Members elected to any Sector Committee shall hold office for a term of two years, and may be re-elected to the same office in subsequent years including that immediately succeeding his/her term. Membership on the Sector Committees shall be held on an institutional basis.
The Chairman of a Sector Committee shall be nominated by members of the Sector Committee, confirmed by majority vote, and presented to the Office of the Chairman for consideration as a member of the Executive Committee.
The Chairman of each Sector Committee shall prepare an annual strategic plan (the “Committee Plan”) and an annual budget (the “Committee Budget”), including proposed Committee Dues, for presentation to the Executive Committee. Upon the approval of the Executive Committee, the Committee Plan, Budget and Dues shall be communicated to the general membership before the Annual General Meeting.
Each Sector Committee shall have up to eighteen (18) Board members, including the Committee Chairman. The members of each Sector Committee shall be elected by a majority vote of the Members of the Sector Committee Firms.
Delegated Authorities:
i. Each Sector Committee shall have the authority to adopt rules of order that may govern its deliberations, provided, however that the following fundamental procedures shall apply:(a) decisions shall be made on a one-firm-one-vote basis, (b) Committee Dues shall be apportioned fairly to balance the ability to pay and benefits anticipated to Committee Members, (c) there is no inconsistency with the Articles or By-Laws of the Association, and (d) the Executive Committee has an opportunity prior to the effectiveness of the Sector Committee rules to satisfy itself that the foregoing conditions have been met.
ii. The Sector Committee shall have delegated authority to direct, together with the Executive Director, the expenditure of Committee Dues consistent with the Committee Plan.
iii. The Sector Committee may make arrangements with the Executive Director for staff to be made available to the Sector Committee full time or part time; such staff will report to the Executive Director and will have a functional reporting line to the Chairman of the Sector Committee.
iv. The Sector Committee shall have delegated authority to prosecute the Committee Plan with the Government of Japan and other organizations that seek to influence the financial services industry.
v. To insure transparency, the Sector Committee shall report regularly to the Executive Committee on all activities of the Sector Committee, as directed by the Executive Committee. The Executive Committee may object to any action of the Sector Committee outside the scope of its Committee Plan, or action it deems inconsistent with the Articles or By-Laws of the Association.
vi. With respect to press statements, press releases or other public statements, the Sector Committee shall provide, where feasible, advance written notice of such statements consistent with the Committee Plan to the Executive Committee. In the event the Sector Committee Chairman deems a statement to be controversial, he/she is expected to inform the Office of the Chairman. The Executive Committee may set up ad hoc committees, including representatives of the Sector Committee, to clarify and/or resolve any differences of opinion between Sector Committees. However, the Executive Committee shall have ultimate veto power over any press statement. The Executive Committee may require the Sector Committee to qualify its public statements as representing the opinion of the Members of the Sector Committee and not of the general membership of the I.B.A.
Ad Hoc Committees:
The Executive Committee may from time to time appoint additional committees or sub-committees, to be taken from the general membership.
8. Statutory Auditors
Two individuals or an auditing firm shall be elected by the Members of the I.B.A., at each Annual General Meeting to act as auditors, and shall be responsible for the auditing of the accounts of the I.B.A.
9. Financial Year
The first financial period of the I.B.A. shall end on 30th September, 1985, and thereafter each financial year shall commence on 1st October and end on 30th September of the following year.
10. Administration
The Executive Committee may, by written resolution, authorize any member, officer or officers, agent or agents, employee or employees to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Association, and such authority may be general or confined to specific instance; and unless so authorized, no officer, member, agent or employee shall have any power or authority to bind the Association by any contract or engagement or to pledge its credit or to render it liable pecunarily for any purpose or in any amount.
All funds of the I.B.A. shall be deposited from time to time to the credit of the I.B.A. with such financial institutions as the Executive Committee may select.
All checks, drafts, or other orders for the payment of money, notes, acceptances, or other evidences of indebtedness issued in the name of the I.B.A., shall be signed by the Vice-Chairman, Finance and Administration, or the Executive Director, or by such member, officer, agent, or employee of the I.B.A. as shall be determined by the Executive Committee.
Endorsements for deposit to the credit of the I.B.A. in any of its duly authorized depositories may be made without counter-signature, by the Chairman, Vice-Chairmen, Executive Director or by any other member, agent or employee of the I.B.A. to whom the Executive Committee shall have delegated such power.
Annual budgets and annual financial reports including a list of assets and obligations and an income/expense statement, prepared by the Vice Chairman, Finance and Administration, shall be submitted by the Executive Committee to the general membership for approval at the Annual General Meeting of the I.B.A., or at such other time as the Executive Committee may decide.
All reports, documents, studies or recommendations prepared by any Committee, subcommittee, employee or subcontractor shall be submitted to the Executive Committee, prior to being circulated by the Executive Director to the general membership. Such documents shall be the sole property of the I.B.A. and/or its Committees.
The official language for the conduct of the business of the I.B.A. shall be English.
11. Meetings
A. Of the Association
i) Annual General Meeting
A general meeting of the I.B.A. shall be held once a year (the “Annual General Meeting”) within three (3) months after the end of the financial year for the purpose of:
Electing Members to the Executive Committee;
Electing the Chairman and two Vice-Chairmen;
Approving Membership and Advisors Fees and Committee Dues;
Approving Articles of Association revisions;
Approving annual budgets;
Approving annual reports;
Electing the statutory auditors; and
Discussing any other matters notified to the Members by the Executive Committee by way of the agenda.
Notice of Annual General Meetings shall be given to the Members by the Executive Director not less than 30 days prior to the date of the meeting. The Executive Director will send a request to all Members for nominations to the Executive Committee and the Sector Committees no less than thirty (30) days before the Annual General Meeting. Candidates must be nominated at least fifteen (15) days prior to the Annual General Meeting.
ii) Special Meetings
A special meeting of the I.B.A. may be convened by the Executive Committee, or by the greater of 10 Members or 25% of the total membership of the I.B.A. by giving not less than 30 clear days’ notice in writing thereof by way of the Executive Director, stating the purpose of the meeting, which shall be for specific business other than that conducted at the Annual General Meeting.
Notices for all meetings shall be sent by the Executive Director to each member at the address notified by the member to the Executive Director, at the time of inscription, or as amended thereafter by written notification to the Executive Director.
At any general meeting, each Member entitled to vote shall have one vote only. Although Advisors may attend the I.B.A.’s Annual General Meeting, they may not vote on any matter. In addition, Advisors will not have the right to call a general meeting, to propose any agenda items or to make any statements.
Voting may be conducted electronically, subject to the approval of the Executive Committee.
At any meeting of the I.B.A., a quorum shall consist of representatives of not less than half of the Members. Any representative of a member may be represented by an alternate, who shall be from the same financial group, commercial bank, securities firm or representative office and whose name the member will have previously notified to the Executive Director.
Representative Office Members may attend these meetings but may not vote on any matter other than the amount of the Annual Subscription payable by Representative Office Members.
Advisors may attend these meetings but they may not vote on any matter. In addition, Advisors will not have the right to call a general meeting, to propose any agenda items or to make any statements.
Decisions of the I.B.A. shall be by voluntary consensus, confirmed by a simple majority of those present and entitled to vote(unless otherwise specified in these Articles or otherwise agreed by the Members). In the event of a tie the chairman of the meeting shall have the right to cast the deciding vote.
In the absence of the Chairman at any meeting, the Vice-Chairman, Member Services, or in his/her absence the Vice Chairman, Finance and Administration shall act as chairman of the meeting. In the absence of all three, the meeting shall elect a person so to act, and such person shall be a full member or their designee elected to sit on the Executive Committee.
Elections shall be by secret ballot for any position for which more than one candidate stands for election. Any other vote shall be by show of hands, unless otherwise agreed to by the Chairman.
Proceedings of meetings shall be minuted by the Executive Director or in his/her absence by a person nominated to act in his/her stead and shall be signed by the Chairman of the next succeeding meeting after approval.
It is intended that all Members shall have the ability to petition and provide input to the Executive Committee, but that the governance of the Association, unless expressly delegated, shall be determined by the Executive Committee.
In expressing the opinions of the Association, or its Sector Committees, there shall be no presumption of unanimity, and no fines or punishments for a member’s failure to support or comply with the matter determined.
The following actions shall require a vote of three-fourths (3/4) of the Members:
i. merger of the Association with any other legal entity;
ii. transfer of all or a substantial portion of the business or assets of the Association;
iii. selection, appointment and discharge of the Association’s independent auditors;
iv. further expansion of Association membership, including but not limited to (i) insurance; or (ii) investment advisory;
v. any amendment of the Articles of Association