Claims Processing

As a subsidiary organ of the Security Council, the Commission operates within the framework of the Councilís resolutions, particularly resolutions 687 (1991), 692 (1991), 986 (1995) and 1483 (2003) that together established the Commission, its jurisdiction, its policy guidelines and its financing.  

As those resolutions make clear, the Commission was established to process claims and pay compensation for losses and damage suffered by individuals, corporations, Governments and international organizations as a direct result of Iraqís unlawful invasion and occupation of Kuwait. The legal responsibility and liability of Iraq for those losses and damage has been established by the Security Council and expressly accepted by the Government of Iraq. The Commission is thus neither a court nor a tribunal with an elaborate adversarial process. Rather, the Commission was created as a claims resolution facility that could make determinations on a large number of claims in a reasonable time. As such, the Commission operates more in an administrative manner than in a litigation format. The Commissionís claims processing procedures were prescribed by the Security Council and were further elaborated by the Governing Council in a number of its decisions, which have been implemented by the panels of Commissioners. 

The Governing Council established at a very early stage the specific parameters for the resolution of claims. At its first session, held from 23 July to 2 August 1991, it identified the types of claims that were later organized into the six categories of claims detailed in the previous section. By June 1992, it had adopted the Provisional Rules For Claims Procedure ("the Rules") governing all aspects of the processing of claims as well as the selection and appointment of Commissioners. Further elaborations of the Rules were made in subsequent Governing Council decisions, such as Decisions 35 and 114.

In its very first decision, the Governing Council decided to give priority to individual claimants in both the processing and the payment of claims. Specifically, the Council decided to expedite and treat on an urgent basis the resolution of claims of individuals who were forced to leave Iraq or Kuwait (category "A"); the claims of those who suffered serious personal injuries or whose spouse, child or parent died (category "B"); and the claims of those who suffered personal losses of up to US$100,000 (category "C"). Given the traditional emphasis in previous proceedings for the losses suffered by Governments and corporations, this humanitarian decision to focus first on urgent individual claims marked a significant step in the evolution of international claims practice.  

Given the large numbers of claims in categories "A" and "C", the relatively small amount of compensation sought by each claimant and the acceptance by Iraq of legal responsibility for damage arising directly from its invasion of Kuwait, a detailed individual review of these urgent individual claims was neither warranted nor feasible. To deal with these claims in an efficient, fair and impartial manner, the Commission employed, in addition to individual review of claims where necessary, a variety of internationally recognized techniques for processing claims, including computerized matching of claims and verification information, sampling, individual review and, for some loss elements in category "C", statistical modelling. Category "B" claims, on the other hand, being relatively few in number, allowed the panel concerned to resolve them largely through a claim-by-claim review. The claims in categories "A", "B" and "C" that were filed during the regular filing period have been fully processed and successful claimants have already received full payment of their claims in these categories. The outstanding claims in this category include Palestinian and other late-filed claims accepted for filing pursuant to the decisions of the Governing Council (including Decision 12).

In recent years, the focus has been on the larger individual claims (category "D"), the claims by corporations (category "E") and the claims by Governments and international organizations (category "F"). Because many of these claims are complex and seek large amounts of compensation, and because the Rules require that each be reviewed individually, the Commission is limited in the expedited procedures that it can employ for their resolution. Nevertheless, the similarity of loss types and issues across significant numbers of claims has enabled the Commission to employ precedent-setting procedures, which ensure efficiency, fairness and equal treatment in the processing of subsequent and similar claims. To the extent that claims in a particular category or sub-category possess similar legal and factual characteristics, the Commission attempts to resolve such common issues and develop standard valuation methods during the panelsí review of the first instalment of such claims. Once relevant legal and factual precedents have been established, the panels may apply them in their review of subsequent instalments of claims, thus limiting their work to the verification and valuation of the claims and the calculation of any allowable compensation.  

The organization of the category "D", "E" and "F" claims into various sub-categories (according to loss types and similarity of factual, legal and valuation factors) is essential to this precedent-based procedure. For each sub-category of claims, the Commission has established a panel of Commissioners and a corresponding secretariat support section or claims unit.  

The procedures developed for the processing of category "D", "E" and "F" claims follow a number of steps that are set out in the Rules and which have been further elaborated in a work programme prepared by the Executive Secretary in October 1997. The first step in this procedure is the registration of each claim and the organization and computer coding of the claim files. Where possible, this is followed by the grouping of claims according to loss types and similarity of factual, legal and valuation factors.  

Next, the secretariat commences the review of the claims, checking for compliance with certain formal requirements under the Rules. If there are deficiencies, the claimant is requested to make rectifications within the relevant time period specified in the Rules.  

Claims undergoing formal review are included in quarterly reports of the Executive Secretary to the Governing Council issued pursuant to article 16 of the Rules ("Article 16 reports"). These reports list the total number of claims covered and, for each country, the relevant category and total amount of compensation sought. The reports also indicate significant factual and legal issues raised by the claims. The reports are made available to the Governing Council, the Government of Iraq and to all Governments and international organizations that have filed claims (whether on their own behalf or for other claimants), with an invitation to submit within 90 days (for claims in categories "D", "E" and "F") any additional information and views they may have on the issues raised. The information submitted by the Government is subsequently taken into consideration by the panels of Commissioners.  

Before submitting the claim files to the panels, the secretariat, acting upon guidance from the panels, may also request a claimant to provide further information and documentation deemed necessary to complete the file and to enable the Commissioners to perform a substantive review of the claims.  

The Executive Secretary then submits the claims in "instalments" to the panel of Commissioners appointed to review the group of claims in question. The main criteria for the selection of claims for inclusion in an instalment are: the date of the filing of the claim; the compliance of the claim with the filing requirements of the Rules; the homogeneity of the instalment with respect to types of claims, losses claimed and issues raised; geographical balance among the countries represented in the instalment; manageability of the instalment during the review period given to the panel; and the Commissionís Work Programme.  

The submission of a particular instalment of claims to a panel of Commissioners is accompanied by the responses received by Iraq and claimant Governments to relevant Article 16 reports and any additional information and/or documentation provided by the claimants in response to secretariat requests. Where appropriate, the results of on-site inspections undertaken at the request of the Panel by the secretariat with outside expert consultants where appropriate, are also made available to the panel.  

In most instances, these various sources of documentation and other evidence are sufficient for the panel to establish the facts of a claim, to determine whether the claim is a direct loss resulting from Iraqís unlawful invasion and occupation of Kuwait, and, where appropriate, to calculate the amount of compensation to be recommended to the Governing Council. Any further evidentiary input in the review process by either the claimants or by Iraq depends on the extent to which the panel would find such input to be necessary.  

Unsolicited supplementation of claims by claimants has not been accepted since the deadline of 11 May 1998 (15 January 2002 for "F4" claims). In "unusually large or complex" claims, particularly where Iraq was a contracting party, the relevant panel may decide to make claims files available to the Government of Iraq and to request additional written submissions from Iraq. Both the claimants and Iraq may be invited by the panels to participate in oral proceedings. Decision 114.

A strict time limit is set for the panels of Commissioners to deal with each instalment of claims. Claims are normally resolved by panels within six months. The time frame may be extended to twelve months in the case of "unusually large or complex" claims, and up to 18 months where the Governing Council so decides. Decision 35.

Upon completion of its review of a particular instalment of claims, each panel of Commissioners submits a written report through the Executive Secretary to the Governing Council on the claims received and, for each claim, the amount of compensation recommended. The reports also provide brief explanations as to the reasons for the recommendations.  

The amounts recommended by the panels of Commissioners are subject to approval by the Governing Council. The Governing Council may review the amounts recommended and, where it determines circumstances require, increase or reduce them. The Governing Council may, in its discretion, return a particular claim or group of claims for further review by the Commissioners. To date, the Governing Council has approved all of the panelsí recommendations submitted to it by the panels.

The decisions taken by the Governing Council on compensation awards are final and are not subject to appeal or review. Once the decisions have been taken by the Council, the associated panel reports are made public, excluding the identities of individual claimants and any other information determined by the panels to be confidential or privileged. The Governing Council decisions and panel reports can be found on the UNCC web site.  
 

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