Starting from 1998, the process for determining the prices of chemicals will follow these steps:
(i) a questionnaire for collecting data on prices of chemicals has been developed and agreed among the Implementing Agencies and the Fund Secretariat.
(ii) UNEP/IE through the Regional Networks of ODS Officers will collect and collate the prices of chemicals in network countries based on the agreed questionnaire.
(iii) the Fund Secretariat will engage a consultant/consulting firm to collect and collate international and/or regional prices of chemicals from international suppliers and other sources to provide a means of cross-checking national/regional prices obtained through the network. The Consultant will use the methodology for calculating and compiling the prices as described in the next section of the paper.
(iv) on the basis of the results from the above surveys the Secretariat will compile regional/national prices of chemicals and circulate the information to the Implementing Agencies.
(v) the prices should be updated annually through appropriate means. The updated information should be circulated by the Fund Secretariat to the Implementing Agencies not later than one month after the first meeting of the Executive Committee for the year.
(vi) any Implementing Agency may propose a revision to a regional or national price of a certain chemical within the year if circumstances demand. If agreed to by the Implementing Agencies and the Fund Secretariat, the revised price will be used by all agencies in relevant projects for the country or region.
(vii)all prices should exclude duties, taxes and other financial transfers.
Prices of chemicals used in projects submitted to the 23rd Meeting of the Executive Committee
As a one-time measure it was agreed between the Secretariat and the Implementing Agencies that for projects submitted to the 23rd Meeting, prices of chemicals would be the same as those agreed to by the Secretariat and Implementing Agencies in the projects approved at the 22nd Meeting.
Methodology for determining the prices of chemicals to be used in Multilateral Fund projects
Regional/sub regional prices of chemicals will be calculated and applied to countries within the region/sub region for projects financed by the Multilateral Fund. Any variance from the pricing has to be justified and be within 20% of this regional/sub regional price.
Regional/sub regional price is the CIF border price for imported substances, or the FOB border price for exported substances.
where:
CIF: Cost plus insurance plus freight
Cost: Bulk price (factory gate) plus packaging (industry standard).
Insurance: Standard International Rate
Freight: Standard International Rate
FOB : Free on Board, calculated as bulk price (factory gate) plus packaging (industry standard) plus transportation from factory gate to border. (FOB export price should not exceed 120% of the CIF border import price).
The regional/sub regional price of a chemical should be calculated as the weighted average of the CIF import prices of the chemical at major ports of the region/sub region, and/or as the weighted average of the FOB export prices of the chemical at major export ports of the country.
(UNEP/OzL.Pro/ExCom/23/68, Decision 23/52).
(Supporting document: UNEP/OzL.Pro/ExCom/23/64).