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Anantonese Steel Consortium
This treaty was drafted in August 4910 by the Socialist Party of Kalistan (SPoK).
Status: ratification[?]
Description[?]
| Preamble: Given that ferrominerals and all products created from them, as well as Aluminum and Bauxite are considered strategic resources and that these strategic resources should serve first and foremost the needs of the nations who extract and refine them, we Undersigned Nations hereby establish the Anantonese Steel Consortium, to protect these resources and the commodities associated with them from the influences of malicious international actors who seek to do our nations' productive and strategic capacities damage through market manipulation. Article 1: The purpose of this Organization shall be to set production and pricing standards for the world's steel and aluminum commodities. The undersigned nations agree that cooperation in strategic sectors such as Steel and Aluminum production and trade is far more beneficial to producers than competition, whether the market is open or not. Additionally, producers who compete in international trade and production work at cross purposes and eventually end up dislocating their own economies by attempting to outcompete one another internationally. Therefore, our aim is to coordinate the production of ferrominerals and aluminum, as well as set international production limits for production and sale of finished steel and aluminum products, to ensure a maximum pricepoint for all members of the consortium. This will be accomplished by the establishment of a single pricepoint, and a single seller, (The Consortium) all of whose decisions are made by an internal body rather than allowing the international market set prices and demand. Article 2: All member nations agree to comply with the internal decisions of the Consortium once those decisions are made. The method of internal governance will be described below. Noncompliance by any member will be considered a breech of treaty. Article 3: The Board of Directors of the Steel Consortium consists of the Ministers of Trade and Industry of each member state. The Board will be charged specifically with overseeing the Bidding Process, which is described below, and to which all member states agree to support upon joining the consortium. Additionally the Board will be charged with setting the price per lot of Consortium Commodity, and has a fiduciary responsibility to ensure that no memberstate takes a loss on the sale of any part of a Commodity Lot. The Board of the Consortium will be responsible for enforcement of this treaty upon all member nations. Article 4: The Bidding Process All steel produced by signatory nations which is not specifically earmarked for Domestic usage shall be considered "Export Steel", from which a Signatory Nation can draw for all Bids. The Signatory Nation may not sell any export steel to any other buyer other than the Consortium. The Consortium will pay Spot Price for all steel that is being bid to a Lot, and will pay cost for all steel not included in a Lot. Any profits derives from Lot Sales will be divided between members based on the proportion of the Lot that they supplied, so if 45% of the lot was supplied by Kalistan, they shall get 45% of the profits from the sale of the Lot. At each meeting, which will happen at least once a year, each country will determine what steel it requires for domestic consumption and what steel it intends to sell internationally. The Board will determine the demand for Consortium Commodity and create a "Lot" (for example, if the world demands 400 million tonnes of steel for the period, the Consortium will set the Lot at 400 million tonnes.) At this point, each nation will make a bid to supply steel from its "export" stock to the Lot. Neither Kalistan nor Yingdala will be permitted to bid more than 50% of any Lot. Kalistan and Indrala always bid first on any Lot. For example: If the Lot is set at 400 million tonnes for this period, Kalistan may bid up to 200 million tonnes, and Yingdala may bid up to 200 million tonnes. At this point, the lot is filled, and no further bids may be accepted. If in this instance Yingdala bids 200 million tonnes, and Kalistan only bids 35 million tonnes, the Lot is opened to the next senior member, who may bid up to 165 million tonnes to fill the Lot. For the purposes of this Treaty, the two founding States, The Republic of Kalistan (Kalistan) and Yingdala Ya Tong (Yingdala) will be considered equal in terms of seniority. Following the opening of the treaty to other nations, each member state will receive an rank of seniority, by first join basis, for the purposes of seniority. At each meeting, which will happen at least once a year, each country will determine what steel it requires for domestic consumption and what steel it intends to sell internationally. The Board will determine the demand for Consortium Commodity and create a "Lot" (for example, if the world demands 400 million tonnes of steel for the period, the Consortium will set the Lot at 400 million tonnes.) At this point, each nation will make a bid to supply steel from its "export" stock to the Lot. Neither Kalistan nor Yingdala will be permitted to bid more than 50% of any Lot. Kalistan and Indrala always bid first on any Lot. For example: If the Lot is set at 400 million tonnes for this period, Kalistan may bid up to 200 million tonnes, and Yingdala may bid up to 200 million tonnes. At this point, the lot is filled, and no further bids may be accepted. If in this instance Yingdala bids 200 million tonnes, and Kalistan only bids 35 million tonnes, the Lot is opened to the next senior member, who may bid up to 165 million tonnes to fill the Lot. In the event that a nation makes a bid that they do not fill, they move to the bottom of the seniority list for the next bid only. Lots are considered guaranteed contracts for delivery, and should be based on established commitments. Any non-bid export steel from all members of the consortium remains with the Consortium and will be added to the next Lot, or may be sold directly from any Consortium Point. The Lot size is set by the Board as a whole to ensure that all produced steel is sold. The Board can recommend to one member nation that they cut production to prevent over supply of export steel, and the recommendation should be strongly heeded. If a country is recommended to cut production to protect the balance between supply and demand in the world, and it refuses to do so, it will lose its seniority for the next bid, and the Consortium will buy no steel from that country during the next bid process. Article 5: Governance The Consortium shall be governed by a modified consensus arrangement. The chair of the Board will rotate on seniority basis, and the Chair will serve ex officio and will not participate in decision making. For all decisions, the Chair will express what he or she believes to be the decision of the Board. Any member reserves the right to veto any decision that is on the floor, but in the event that no member of the Board expresses an explicit veto, the decision will be carried forth, as stated by the Chair, and all member states will be expected to uphold the decisions. Utilizing this method, the Board will set the Lot Spot, which will ensure that no nation who has supplied steel or aluminum to a Lot will lose money on their production. The Spot may never be set below the most expensive price per unit from a nation that supplies to the Lot. For example, if Kalistan and Yingdala supply steel to a Lot, and Kalistan produces Steel at 683 KRB per Tonne, while Yingdala produces it at 785 KRB per Tonne, the Spot for that Lot cannot be set below 785 KRB. It can be set at any price above that most expensive price. The Consortium may only sell any Export Steel, whether it is in a Lot or it is non-Bid Steel in direct sales, at the current Spot price. Sanction for defecting on any decision of the Board will result in the loss of seniority for the next bidding process. Article 6: Supercedance Any Standing Agreements in place at the beginning of this treaty shall not be counted toward "Export Steel" calculations. No member nation may renegotiate or extend existing agreements past their term following adoption of this treaty. Article 7: Enactment The treaty will be considered enacted upon ratification of both Kalistan and Yingdala. It will be nullified in the event that either founding state leaves the treaty, and all Export Steel will will be restored to national control, with full refund of the cost to the Consortium. Article 8: Capitalization Both Kalistan and Yingdala will supply an initial Capital outlay of not more than 1 Billion KRB to found the Consortium, and liquidation of Consortium assets will prioritize Kalistani and Yingdalan interests equally until their initial capitalization is returned. In the event that one of the two founding nations withdraws from the Treaty, the other will be compensated first. Following full settlement of investment claims from both Yingdala and Kalistan, whatever remains will then go to pay off other investors according to seniority in the Organization. The Consortium will not accept capitalization or investment from non-Member Nations. |
Articles[?]
The treaty consists of the following articles.
Ratifiers[?]
The treaty has been formally ratified by the following nations.
| Nation | Date |
Pending Ratifications
Compliance[?]
The treaty contains no articles that can be verified.
Ratification
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Ratification Map
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