The World Bank 1 (202) 473-1000 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPME IT *s.ge Cable Address: INTBAFRAD INTERNATIONAL DE jELOPMENT ASSOCIATION Cable Address: INDEVAS December 18, 2012 Ambassador Henrik 3ramsen Fahn Head of Department for Green 3ro' vth Ministry of Foreign Affairs of Deniark DK-1448 Asiatisk Plads Copenhag n K Kingdom of Denmark Dear Mr. Hahn: Re: Trust Fund Administration Agreement between the Ministry for Foreign Affairs of Dinmark and the International Bank for Reconstruction and )ev lopment concerning the Wealth Accounting and Valuation of Ecosyrtem Services Multi-Donor Trust Fund (TF No. 071866) 1. We are pleased to a-knowledge on behalf of the International Bank for Reconstruction and Development (*'IBRD" or the "Bank") that the Ministry of Foreign Affairs of Denmark (the "Donor"), shall make available as a grant the sum of Ten Million Danish Krone (DKK 10,000,000) (the "Contribution") for the Wealth Accounting and Valuation of Ecosystem Services Mtulti-Donor Trust Fund (WAVES) (the "Trust Fund") in accordance with the terms of -his Agreement. Other donors are also expected to contribute to the Trust Fund or the terms and conditions specified in the Annexes to this Agreement. 2. The Contribution shall be used to finance the activities and the categories of expenditure set forth in the "Descri tion of Activities and Expenditures under the Wealth Accounting and Valiation of Elcosystem Services Multi-Donor Trust Fund (WAVES)" attached hereto as Annex 1, and sh, 11 be administered by the Bank on behalf of the Donor in accordance with the terms of this Agreement including the "Standard Provisions Applicable to the Wealth Accounti ig and Valuation of Ecosystem Services Multi-Donor Trust Fund (WAVES)" (the "S:and ird Provisions") attached hereto as Annex 2. As stated in Annex 2, Standard Provisiors, S:-ction 5.2, the Bank will furnish to the Donors current financial information relating to re.eipts, disbursements and fund balance in the holding currency of the Trust Fund with re ;pect to the Contributions via the World Bank's Trust Funds Donor Center secure web)sitc. 3. The Donor s[iall depost the- Contribution into such bank account designated by the Bank in installments in accorda ice with the following schedule: RCA 24842 3. Q WUI 64145 Q FAX (202) 477-6391 -2- December 18, 2012 (a) Promptly following countersignature of this Arrangement by the Donor and submission of a payment request by the Bank, DKK 2,500,000. (b) On or before January '0, ::013, DKK 2,500,000 and submission of a payment request by the Bank. (c) On or before January :0, ':014, DKK 2,500,000 and submission of a payment request by the Bank. (d) On or before January :10, ::015, DKK 2,500,000 and submission of a payment request by the Bank. 4. When making such deposits, the Donor shall instruct its bank to include in its payment details information (remi tance advice) field of its SWIFT payment message, infcrmation indicating: the amount paid, that the payment is made by the Donor for TF No. 071860 (the Wealth Accountir g and Valuation of Ecosystem Services Multi-Donor Trust Fund (WAVES)), and 1he late of the deposit (the "Deposit Instruction"). In addition, the Donor shall provide a copy of the Donor's Deposit Instruction to the Bank's Accounting Trust Funds Division 1y e-mail sent to tfremitadvice@worldbank.org or by fay sent to (202) 614-1315. 5. The Bank shall converl the Contribution funds into the holding currency of the Trust Fund, namely United Stat s Dollars (USD), promptly upon receipt of the Contribution funds and the Depos t Instruction containing the information specified in paragraph 4 at the exchange rite obtained by the Bank on the date of the conversion. Where the contribution proves to t e insufficient to complete the activities as a result of an exchange rate fluctuation, noithc r the Bank nor the Donor shall bear any responsibility for providing any additional financing. 6. Except as p:ovided fcr it paragraph 4 above, any notice, request or other communication to be given or n ade under this Agreement shall be in writing and delivered by mail, facsimile or e-m iil to the respective party's address specified below or at such other address as such party lotifies in writing to the other party from time to time: For the Bank: Glenn,-Marie Laige Senior Economist Agriculture and Envronmental Services The World Bank 1818 [-I Street, NW Washington, DC 2C433 U.S.A. Tel: (202) 473-2735 Fax: (202) 477-0565 E-ma 1: glangel @w )rldbank.org -3- December 18, 2012 Fo the Government f Denmat k: Christoffer Bertelser Senior Advisor Department for Gree n Growth Ministry of Foreign kffairs ASIATISK PLADS 2 / DK-1448 KOBENHAVN K Denmark Tel: --45 3392 1530 Email : chrber(@um. ik 7. All annexes hereto constitu e an integral part of this Agreement. This Agreement may be amended only in writi.ag tetween the Bank and the Donor; provided, however, that such annexes may be amended only with the agreement of all donors contributing to the Trust Fund. 8. Please confirm your a&reer ment with the foregoing, on behalf of the Donor, by signing, dating, and returning to us the enclosed copy of this Agreement. Upon receipt by the Bank of a fully signed Agreerient, this Agreement will become effective as of the date of the countersignature ("Date of Effectiveness"). Sincerely, INTERNATIONAL BANK FC R RECONSTRUCTION AND DEVELOPMENT Juergen Voegele Director Agricultur and Environmental Services AiREED: By: Date: Nzane: Ambassador [lenrik Bnmso n Hahn Tile: Head of Department for Gre, n Growth -4- December 18, 2012 ANNEX 1 Description of Activities and Expenditures under the Wealth Accounting and Valuation of Ecosystem Services Multi-Donor Trust Fund (WAVES) This Annex will be applicable to and form an integral part of all arrangements entered into between the Bark and enti:ies i collectively, the "Donors") that provide contributions (the aggregate of all -ontributic ns f -om the Donors, the "Contributions") to be administered by the Bank for tf.e Tiust Fund. A. DESCRIPTION OF ACTIVITJ ES The activities to be f nanced by the Trust Fund are: Component 1. Implementing ecosy ;tem accounting at national or sub-national level in several developing and develored countries 1.1. Establishing an institutinal structure to guide ecosystem accounting. 1.2. Coordinating in-countr3 implementers. 1.3. Building capacity for ec osy, tern and comprehensive wealth accounts. 1.4. Constructing ecosystem and comprehensive wealth accounts Component 2. Incorporating natura, capital accounting in policy analysis and development planning 2.1. Building support and lo -al capacity for analysis in partner countries. 2.2. Implementing policy analys s. 2.3. Providing pol icy inputs: deN elop outreach materials. 2.4. Holding annLal workshops vith broad-based participation. Component 3. Developing standarcized guidelines for ecosystem accounting for global implementation 3.1. Establishing and coordi.atii ng a Technical Experts Group to guide development and implementation of methodolog es for ecosystem accounting to ensure cohesion, consistency and scalability of c:uniry studies. 3.2. Contributing guidelines for scosystem accounting to the revised Handbook of the System of Environm ntal and I con zmic Accounting. Component 4. Promoting the adopt Lon of ecosystem and natural capital accounting beyond the WAVES partner countr es 4.1 Establishing a broad ph tfor n for knowledge sharing and capacity building. 4.2 Conducting a review of cou itry experiences with environmental accounts. 4.3 Participating in intemat [ona L forums that promote natural capital accounting. -5- December 18, 2012 B. CATEGORIES OF EXPENDI 'URE For Bank-Executed z.ctivities tfe Contributions may be used to finance: (a) Associated overheads; (b) Consultant fees individuals md firms; (c) Extended term consultaits; (d) Media, workshop, conferen.e and meeting; (e) Staff Costs with indirec :s; (f) Temporary support staf 'coE ts; (g) Travel expenses; (h) Contractual services; and (i) Equipment and office premi ses lease cost. For Recipient-Executed activities, t ie Contributions may be used to finance: (a) goods; (b) services; and (c) operating costs and any other allowable expenditures. The foregoing categories of expend itures may include the financing of taxes. -6- December 18, 2012 ANNEX 2 Standard Provisions Applicable to the WAVES - Wealth Accounting and Valuation of Ecosystem Services Multi-Donor Trust Fund This Annex will be applicable to and form an integral part of all arrangements entered int: between the Bank and the Donors that provide Contributions to be administered by the Bank for the Trust Fund. 1. Administration of the C:ntr butions 1.1. The Bank will be respoiisibl e only for performing those functions specifically set forth in this Arrangement and will r.ot be subject to any other duties or responsibilities to the Donors, including, without limi ation, any duties or commitments that might otherwise apply to a fiduciary cr tn stee under general principles of trust or fiduciary law. Ncthing in this Arrangement wIll b, considered a waiver of any privileges or immunities of the IBRD under its Articles of A),reement or any applicable law, all of which are expressly reserved. 1.2. The Contribution will b- ad ninistered in accordance with the Bank's applicable po cies and procedu-es, as the sam. may be amended from time to time, including its framework to prevent and combat f -aud and corruption and its screening procedures to prevent the use of Bank resources to finance terrorist activity, in line with the Bank's commitments to give effect to the r levant decisions of the Security Council, taken under Chapter VII of the of Charter o "the United Nations. The Donor acknowledges that this provision does not cieate any comn itments of the Bank under the anti-terrorist financing and asset control laws, regulations, rules and executive orders of an individual member country that may apply to the lonor, nor will it be deemed a waiver, express or implied, of any of the privileges and immnun ties of the Bank. 2. Commingling, Exchange and Investment of the Contributions 2.1. The Contributions will be at :counted for as a single trust fund and will be kept separate and apart from the funds o "the Bank. The Contributions may be commingled with other trust fund assets maintai ied by the Bank. 2.2 The Contributions may be f -eely exchanged by the Bank into other currencies as may facilitate their disbursement. 2.3 The Bank wi1 invest and re nvest the Contributions pending their disbursement in accordance with the Bank's po icie; and procedures for the investment of trust funds administered by the 3ank. The Bai k will credit all income from such investment to the Trust Fund to be used for the same purposes as the Contributions. -7- December 18, 2012 3. Administrative Cost Recovery 3.1 In order to assist in the defr yment of the costs of administration and other expenses incurred by the Bank ind:r this Arrangement, the Bank may deduct and retain for its own account an amount equa[ to two percent (2%) of each Contribution. In addition, costs for program manage nent and administration as defined in Annex 1 up to a maximum of 10.7 percent (10.7%) of the contribution will be charged to the Trust Fund on an actual basis. If the contributions increase beyond what was originally expected at the time of counter-s [gnature of the first administration arrangement, and the administrative costs increase as a result, the Donors acknowledge that an additional administrative fee may be applied to such new contributions. 4. Procurement 4.1. The employment and supen ision of any consultants and the procurement of any goods financed by the Contribution, will be the responsibility of the Bank and will be carried out in accordance with its applicable policies and procedures. 5. Accounting and Financial R -porting 5.1. The Bank will maintain sepa rate records and ledger accounts in respect of the Contributions deposited in the Trus. Fund account and disbursements made therefrom. 5.2. The Bank will furnish to the Donors current financial information relating to receipts, disbursements and fund bE lance in the holding currency of the Trust Fund with respect to the Contributions via the World Bank's Trust Funds Donor Center secure website. Within six '6) months after all commitments and liabilities under the Trust Fund have been satisfied and the Trust Find has been closed, the final financial information relating to receipts, disbursements , nd fund balance in the holding currency of the Trust Fund with respect to the Contributions will be made available to the Donors via the World Bank's Trust Funds Dor,or Center secure website. 5.3 The Bank will provide to th Donors, within six (6) months following the end of each Bank fiscal year, an annu.l sit gle audit report, comprising (1) a management assertion together with an attes atio r from the Bank's external auditors concerning the adequacy of internal control over ca Lsh-based financial reporting for all cash-based trust funds as a whole; and (2) a con bin .d financial statement for all cash-based trust funds together with the Bank's exterr al a iditor's opinion thereon. The cost of the single audit will be borne by the Bank. 5.4. If a Donor w shes to reques , on an exceptional basis, a financial statement audit by the Bank's external auditors oft ie Trust Fund, the Donor and the Bank will first corsult as to whether such an eKterial audit is necessary. The Bank and the Donor will de.ide on the appropriate scope an(. terms of reference of such audit. Following a -8- December 18, 2012 dec Ision on the scope and term, of Ieference, the Bank will arrange for such external audit. The costs of a.iy such audit, ncluding the internal costs of the Bank with respect to such audit, will be paid by th. requesting Donor. 6. Progress Reporting 6.1. The Bank will provide the E onors with an annual report on the progress of activities financed by the Contribut ons. Within six (6) months of the final disbursement dale specified in paregraph 7.1, the Bank will furnish to the Donors a final report on the activities financed by the Trust Fun 1. 6.2 Any Donor may review or e valuate activities financed by the Trust Fund. The Donor and the Bank will decide on the scope and conduct of such review or evaluation, and the Bank will provide all re levc nt information within the limits of its policies and procedures. All associated cosis will be borne by the Donor. It is understood that any sucn review or evaluation will not constitute a financial, compliance or other audit of the Trust Fund. 7. Disbursement; Cancellation Refund 7.1. It is expected that the C ntr butions will be fully disbursed by the Bank by June 30. 2016. The Bank will only disbu -se Contributions for the purposes of this Arrangement after such date with tl Le written approval of the Donors. 7.2 Any Donor or the Bank may, upon three (3) months' prior written notice, cancel all or part of the Donor's pro rata s tare, of any remaining balance of the Contributions that is not committed pursuant :o aiy agreements entered into between the Bank and any consultants and/or other third participants for the purposes of this Arrangement prior to the receipt of such notice, includinj the Grant Agreement[s]. 7.3. Following the final dist urse ment date specified in paragraph 7.1, the Bank will return any remaining balance of the Contributions to the Donors on a pro rata basis based on the Donors' paid Contributions. In the event of a cancellation the Bank will promptly return to the relevant Donor or Dor ors the Donor's pro rata share of uncommitted Contributions in accordance with p 3ragraph 7.2. 8. Disclosure The Bank will disclose this Arrangement and related information on this Trust Fund in accordance with the Work Bank Policy on Access to Information. By entering into this Arrangement, Donors con ;ent to disclosure of this Arrangement and related information on this Trust Fund.