(v) a statement of the sources and uses of funds by the enterprise as a whole; (vi) the average number of employees in each geographical area; (vii) research and development expenditure for the enterprise as a whole, (viii) the policies followed in respect of intragroup pricing; (ix) the accounting policies, including those on consolidation, observed in compiling the published information. COMPETITION Enterprises should while conforming to official competition rules and established policies of the countries in which they operate, (1) refrain from actions which would adversely affect competition in the relevant market by abusing a dominant position of market power, by means of, for example, (a) anticompetitive acquisitions, (b) predatory behavior toward competitors, (c) unreasonable refusal to deal, (d) anticompetitive abuse of industrial property rights, (e) discriminatory (i.e. unreasonably differentiated) pricing and using such pricing transactions between affiliated enterprises as a means of affecting adversely competition outside these enterprises; (2) allow purchaser, distributors and licensees freedom to resell, export, purchase and develop their operations consistent with law, trade conditions, the need for specialization and sound commercial practice; (3) refrain from participating in or otherwise purposely strengthening the restrictive effects of international or domestic cartels or restrictive agreements which adversely affect or eliminate competition and which are not generally or specifically accepted under applicable national or international legislation; (4) be ready to consult and cooperate, including the provision of information, with competent authorities of countries whose interests are directly affected in regard to competition issues or investigations. Provision of information should be in accordance with safeguards normally applicable in this field. FINANCING Enterprises should, in managing the financial and commercial operations of their activities, and especially their liquid foreign assets and liabilities, take into consideration the established objectives of the countries in which they operate regarding balance of payments and credit policies. ΤΑΧΑΤΙΟΝ Enterprises should (1) upon request of the taxation authorities of the countries in which they operate, provide, in accordance with the safeguards and relevant procedures of the national laws of these countries, the information necessary to determine correctly the taxes to be assessed in connection with their operations, including relevant information concerning their operations in other countries; (2) refrain from making use of the particular facilities available to them, such as transfer pricing which does not conform to an arm's length standard, for modifying in ways contrary to national laws the tax base on which members of the group are assessed. EMPLOYMENT AND INDUSTRIAL RELATIONS Enterprises should within the framework of law, regulations and prevailing labor relations and employment practices, in each of the countries in which they operate, (1) respect the right of their employees to be represented by trade unions and other bona fide organizations of employees, and engage in constructive negotiations, either individually or through employers' associations, with such employee organizations with a view to reaching agreements on employment conditions, which should include provisions for dealing with disputes arising over the interpretation of such agreements, and for ensuring mutually respected rights and responsibilities; (2)(a) provide such facilities to representatives of the employees as may be necessary to assist in the development of effective collective agreements; (b) provide to representatives of employees information which is needed for meaningful negotiations on conditions of employment; (3) provide to representatives of employees where this accords with local law and practice, information which enables them to obtain a true and fair view of the performance of the entity or, where appropriate, the enterprise as a whole; (4) observe standards of employment and industrial relations not less favorable than those observed by comparable employers in the host country; (5) in their operations, to the greatest extent practicable, utilize, train and prepare for upgrading members of the local labor force in cooperation with representatives of their employees and, where appropriate, the relevant governmental authorities; (6) in considering changes in their operations which would have major effects upon the livelihood of their employees, in particular in the case of the closure of an entity involving collective lay-offs or dismissals; provide reasonable notice of such changes to representatives of their employees, and where appropriate to the relevant governmental authorities, and cooperate with the employee representative and appropriate governmental authorities so as to mitigate to the maximum extent practicable adverse effects; (7) implement their employment policies including hiring, discharge, pay, promotion and training without discrimination unless selectivity in respect of employee characteristics is in furtherance of established governmental policies which specifically promote greater equality of employment opportunity; (8) in the context of bona fide negotiations3 with representatives of employees on conditions of employment or while employees are exercising a right to organize, not threaten to utilize a capacity to transfer the whole or part of an operating unit from the country concerned in order to influence unfairly those negotiations or to hinder the exercise of a right to organize; (9) enable authorized representatives of their employees to conduct negotiations on collective bargaining or labor management relations issues with representatives of management who are authorized to take decisions on the matters under negotiation. SCIENCE AND TECHNOLOGY Enterprises should (1) endeavor to ensure that their activities fit satisfactorily into the scientific and technological policies and plans of the countries in which they operate, and contribute to the development of national scientific and technological capacities, including as far as appropriate the establishment and improvement in host countries of their capacity to innovate; (2) to the fullest extent practicable, adopt in the course of their business activities practices which permit the rapid diffusion of technologies with due regard to the protection of industrial and intellectual property rights; (3) when granting licenses for the use of industrial property rights or when otherwise transferring technology do so on reasonable terms and conditions. DECISION OF THE COUNCIL ON INTERGOVERNMENTAL CONSULTATION PROCEDURES ON THE GUIDELINES FOR MULTINATIONAL ENTERPRISES The Council, Having regard to the Convention on the Organization for Economic Cooperation and Development of December 14, 1960, and, in particular, to Articles 2(d), 3 and 5(a) thereof; Having regard to the resolution of the Council of January 21, 1975, establishing a Committee on International Investment and Multinational Enterprises and, in particular, to paragraph 2 thereof [C(74)247(Final)]; Taking note of the Declaration by the Governments of OECD member countries of June 21, 1976, in which they jointly recommend to multinational enterprises the observance of guidelines for multinational enterprises; Recognizing the desirability of setting forth procedures by which consultations may take place on matters related to these guidelines; On the proposal of the Committee on International Investment and Multinational Enterprises; DECIDES: 1. The Committee on International Investment and Multinational Enterprises (hereinafter called the "Committee") shall periodically or at the request of a member country hold an exchange of views on matters related to the guidelines and the experience gained in their application. The Committee shall periodically report to the Council on these matters. 2. The Committee shall periodically invite the Business and Industry Advisory Committee to OECD (BIAC) and the Trade Union Advisory Committee to OECD (TUAC) to express their views on matters related to the guidelines and shall take account of such views in its reports to the Council. 3. On the proposal of a member country the Committee may decide whether individual enterprises should be given the opportunity, if they so wish, to express their views concerning the application of the guidelines. The Committee shall not reach conclusions on the conduct of individual enterprises. 4. Member countries may request that consultations be held in the Committee on any problem arising from the fact that multinational enterprises are made subject to conflicting requirements. Governments concerned will cooperate in good faith with a view to resolving such problems, either within the Committee or through other mutually acceptable arrangements. 5. This Decision shall be reviewed within a period of three years. The Committee shall make proposals for this purpose as appropriate. The Council, DECISION OF THE COUNCIL ON NATIONAL TREATMENT4 Having regard to the Convention on the Organization for Economic Cooperation and Development of December 14, 1960, and, in particular, Articles 2(c), 2(d), 3 and 5(a) thereof; Having regard to the resolution of the Council of January 21, 1975, establishing a Committee on International Investment and Multinational Enterprises and, in particular, paragraph 2 thereof [C(74)247 (Final)]; Taking note of the Declaration by the Governments of OECD member countries of June 21, 1976, on national treatment; Considering that it is appropriate to establish within the Organization suitable procedures for reviewing laws, regulations and administrative practices (hereinafter referred to as "measures") which depart from "National Treatment;" On the proposal of the Committee on International Investment and Multinational Enterprises; DECIDES: 1. Measures taken by a member country constituting exceptions to "National Treatment" (including measures restricting new investment by "Foreign-Controlled Enterprises" already established in their territory) which are in effect on the date of this Decision shall be notified to the Organization within 60 days after the date of this Decision. 2. Measures taken by a member country constituting new exceptions to "National Treatment" (including measures restricting new investment by "Foreign-Controlled Enterprises" already established in their territory) taken after the date of this Decision shall be notified to the Organization within 30 days of their introduction together with the specific reasons therefor and the proposed duration thereof. 3. Measures introduced by a territorial subdivision of a member country, pursuant to its independent powers, which constitute exceptions to "National Treatment," shall be notified to the Organization by the member country concerned, insofar as it has knowledge thereof, within 30 days of the responsible officials of the member country obtaining such knowledge. 4. The Committee on International Investment and Multinational Enterprises (hereinafter called the "Committee") shall periodically review the application of "National Treatment" (including exceptions thereto) with a view to extending such application of "National Treatment." The Committee shall make proposals as and when necessary in this connection. 5. The Committee shall act as a forum for consultations, at the request of a member country, in respect of any matter related to this instrument and its implementation, including exceptions to "National Treatment" and their application. 6. Member countries shall provide to the Committee, upon its request, all relevant information concerning measures pertaining to the application of “National Treatment" and exceptions thereto. 7. This Decision shall be reviewed within a period of three years. The Committee shall make proposals for this purpose as appropriate. The Council, DECISION OF THE COUNCIL OF INTERNATIONAL Having regard to the Convention on the Organization for Economic Cooperation and Development of December 14, 1960, and, in particular, Articles 2(c), 2(d), 2(e), 3 and 5(a) thereof; Having regard to the resolution of the Council of January 21, 1975, establishing a Committee on International Investment and Multinational Enterprises and, in particular, paragraph 2 thereof [C(74)247 (Final)]; Taking note of the Declaration by the Governments of OECD member countries of June 21, 1976, on international investment incentives and disincentives; On the proposal of the Committee on International Investment and Multinational Enterprises; DECIDES: 1. Consultations will take place in the framework of the Committee on International Investment and Multinational Enterprises at the request of a member country which considers that its interests may be adversely affected by the impact on its flow of international direct investments of measures taken by another member country specifically designed to provide incentives or disincentives for international direct investment. Having full regard to the national economic objectives of the measures and without prejudice to policies designed to redress regional imbalances, the purpose of the consultations will be to examine the possibility of reducing such effects to a minimum. 2. Member countries shall supply, under the consultation procedures, all permissible information relating to any measures being the subject of the consultation. 3. This Decision shall be reviewed within a period of three years. The Committee on International Investment and Multinational Enterprises shall make proposals for this purpose as appropriate. 'The Turkish Government was not in a position to participate in this Declaration. [Footnote in original.] 2For the purposes of the guideline on disclosure of information the term "geographical area" means groups of countries or individual countries as each enterprise determines it appropriate in its particular circumstances. While no single method of grouping is appropriate for all enterprises, or for all purposes, the factors to be considered by an enterprise would include the significance of operations carried out in individual countries or areas as well as the effects on its competitiveness, geographic proximity, economic affinity, similarities in business environments and the nature, scale and degree of interrelationship of the enterprises' operations in the various countries. [Footnote in original.] Bona fide negotiations may include labor disputes as part of the process of negotiation. Whether or not labor disputes are so included will be determined by the law and prevailing employment practices of particular countries. [Footnote in original.] 4Turkey abstained on the three decisions. OECD Press Release, PRESS/A(76)20. For the full text of Secretary Kissinger's statement to the OECD Council see Dept. of State Bulletin, Vol. LXXV, No. 1934, July 19, 1976, pp. 73–83. A letter dated Aug. 19, 1976, from Secretary Kissinger, Secretary of the Treasury William E. Simon, and Secretary of Commerce Elliot L. Richardson, sent to more than 800 chief executives of major U.S. corporations, commended the Guidelines to all enterprises in the United States. See Dept. of State Bulletin, Vol. LXXV, No. 1944, Sept. 27, 1976, pp. 403-404. Reporting Requirements Effective January 1, 1976, the Bureau of Economic Analysis of the Department of Commerce amended the reporting requirements of 15 Code of Federal Regulations Part 803, pertaining to certain foreign business enterprises owned by U.S. persons and U.S. business enterprises owned by foreign persons. The reporting requirements were changed, by notice dated June 2, 1976, to require quarterly, rather than annual, reports for U.S. direct investment abroad in insurance subsidiaries and branches owned by foreign persons. Changes were also made in quarterly reporting on incorporated motion picture subsidiaries and branches, and a new report form was instituted to solicit information that will permit assigning an industry code to a U.S. reporter and its foreign parent. The data called for are collected under the authority of the Bretton Woods Agreements Act (22 U.S.C. 286-286k-1). For the announcement of June 2, 1976, and 15 CFR Part 803, as revised, see Fed. Reg., Vol. 41, No. 113, June 10, 1976, pp. 23606-23609. International Investment Survey Act of 1976 On October 11, 1976, the President approved the International Investment Survey Act of 1976 (P.L. 94-472; 90 Stat. 2059; 22 U.S.C. 3101 et seq.), to supplement the authority of the President to collect regular and periodic information on international investment. The |