1. The effective abolition of child labour is one of the most urgent chal- Child labour: a large- lenges of our time. Today, we have a better grasp of the size and the shape of scale violation of the problem: of the more than 200 million child labourers worldwide, some children’s rights 180 million are now suspected to be toiling in the “worst forms” of child labour – those activities that the global community has unanimously agreed are inexcusable under any circumstances and must be eliminated without de­lay. The persistence on such a scale of this violation of children’s basic human rights casts a shadow over us all.
  2. We also have a better understanding of the factors that give rise to child A better understanding labour and of its consequences. Child labour is clearly detrimental to indi- of the problem vidual children, preventing them from enjoying their childhood, hampering their development and sometimes causing lifelong physical or psychological damage; it is also detrimental to families, to communities and to society as a whole. As both a result and a cause of poverty, child labour perpetuates dis­advantage and social exclusion. It undermines national development by keep­ing children out of school, preventing them from gaining the education and skills that would enable them as adults to contribute to economic growth and prosperity. As long as child labour continues, the ILO’s goal of decent work can never be achieved.
  3. In recent years, a sea change in awareness of child labour has occurred A worldwide movement across the world and this has strengthened countries’ attitudes with regard to against child labour its abolition. Little more than a decade ago, child labour was dismissed by many as an inevitable cultural phenomenon, and by some as non-existent. Be­fore the early 1990s, there was no tripartite consensus on the urgency of deal­ing with child labour. Countries were hesitant to admit that it might exist within their borders, for fear of a negative international reaction, including possible trade sanctions. The situation at that time regarding child labour was largely one of denial, much as it has been for the related occurrence of forced labour. [1]
  4. A worldwide movement, involving the ILO’s constituents – governments and employers’ and workers’ organizations – and many other partners working together at international, national and local levels, has altered that irrevoc­ably. The end of the cold war created the political space for a franker discus-sion of the problem. Developing, transition and developed countries are today linked by a shared acknowledgement that child labour touches them all in some form and to some degree, and by partnerships to tackle the problem.
  1. The past decade has seen an unprecedented convergence of thought and action around this cause, in recognition of the fact that the abolition of child labour is an issue at the heart of social and economic development and not at its margins. The ILO’s International Programme on the Elimination of Child Labour (IPEC) has, over its ten years of existence, become the largest single technical cooperation programme of the Organization. The ILO will mark the first World Day against Child Labour on 12 June 2002.
  2. It is thus no accident that the effective abolition of child labour features as one of the four principles concerning fundamental rights in the ILO Decla­ration on Fundamental Principles and Rights at Work (Annex 1), along with freedom of association and the effective recognition of the right to collective bargaining, the elimination of all forms of forced or compulsory labour and the elimination of discrimination in respect of employment and occupation. This followed directly on from its earlier inclusion in the indivisible package of rights at work endorsed in the Copenhagen Declaration on Social Develop­ment. [2]
  3. The world’s gathering resolve to combat child labour is evidenced by a number of key milestones and actions:
  • the long tradition of ILO standard setting and supervision in the field of child labour, dating from the very first session of the International La­bour Conference in 1919 and leading up to the adoption of the umbrella Minimum Age Convention, 1973 (No. 138);
  • the impetus given by the adoption of the United Nations Convention on the Rights of the Child (CRC) in 1989;
  • the experience gained by national governments working with IPEC;
  • increased activism on child labour by employers’ and workers’ organiza­tions and non-governmental organizations (NGOs);
  • the unanimous adoption of the Worst Forms of Child Labour Convention, 1999 (No. 182), and the subsequent campaign for its universal ratifica­tion and implementation;
  • the designation of Conventions Nos. 138 and 182 as fundamental Con­ventions;
  • research and action that have provided new insights into the causes, di­mensions and means of reducing both poverty and child labour.
  1. Along with wider recognition of the problem of child labour has come better knowledge and understanding of how to tackle it, and the determination to work together towards the common goal of its elimination.
  2. The ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up reaffirms the framework for member States to respect the prin­ciple of the effective abolition of child labour.[3] As the Declaration’s preamble notes, “in seeking to maintain the link between social progress and economic growth, the guarantee of fundamental principles and rights at work is of par­ticular significance in that it enables the persons concerned … to achieve fully their human potential” – a concept that takes on special significance with respect to children and child labour.
  3. The obligations set out in the ILO Declaration are reciprocal. On the one hand, member States are obliged, to the best of their resources and fully in line with their specific circumstances, to respect, to promote and to realize the principles of the Declaration concerning fundamental rights. On the other hand, the Organization is obliged to assist its Members to achieve this goal. This is a genuine partnership: where political will exists to eliminate child labour, the ILO will do what it can to support the efforts made by member States to do so. The commitment in the ILO Declaration that “labour standards should not be used for protectionist trade purposes, and that nothing in this Declaration and its follow-up shall be involved or otherwise used for such pur­poses” has further encouraged countries to seek assistance from the Organ­ization, rather than to try to conceal or deny any problem that might exist. This practice had already started, through IPEC, even before the adoption of the Declaration.
  4. The Declaration calls upon the ILO to make full use of its constitutional, operational and budgetary resources to support countries’ efforts. Of the four principles in the Declaration, the abolition of child labour has been the one for which the most resources have been mobilized, both internally and exter­nally, thus enabling major support to be provided by the ILO. The wealth of experience gained by IPEC and other ILO programmes, working with a broad range of partners, provides a solid foundation for planning strategies for the future.
  5. As part of the follow-up to the ILO Declaration, this Global Report presents a “dynamic global picture” relating to the effective abolition of child labour.
  6. Part I traces the development of the worldwide movement against child labour and outlines the scope of the principle of effective abolition. It goes on to review the size and shape of the child labour problem in developing, tran­sition and developed countries, and explores how this is exacerbated by dif­ferent shocks to development, from HIV/AIDS to natural disasters. It demonstrates how different types of work can pose hazards for children, even some forms of work that, at first sight, might appear to be harmless. Part I con­cludes by highlighting key elements in our current understanding of the inter­related causes of child labour that together contrive to make this such a stubborn and persistent problem, despite serious efforts to eradicate it.
  7. Part II reviews the growing body of experience in practical action to fight child labour. It examines the critical role of good information as a basis for ef­fective action and considers the support being given at the international level to the fight against child labour, including that of the ILO and, in particular, IPEC. After outlining the key role played by national governments in demon­strating political commitment and providing the enabling environment for the abolition of child labour, the Report goes on to review action taken by employ­ers’ and workers’ organizations, governments and other stakeholders, often with the support of IPEC and other ILO programmes. A selection of good prac­tice examples of different forms of intervention against child labour is pre­sented, indicating important lessons learned and laying the groundwork for an assessment of the effectiveness of ILO assistance in this field.
  8. With a view to assisting the ILO Governing Body to determine priorities for future technical cooperation, Part III of the Report outlines a possible ac­tion plan against child labour built around three pillars: reinforcing the work
Progress made but no room for complacency of IPEC, mainstreaming child labour in the Decent Work Agenda and forging closer partnerships among the many actors working in this field.

16.       Part III also presents suggested points for discussion at the 90th Session of the International Labour Conference in June 2002.

17.       This first Global Report on the effective abolition of child labour under the follow-up to the ILO Declaration charts the significant progress that has been made towards achieving this goal but reveals that there is still a consid­erable way to go. The evidence presented affords more than ample reason for the ILO and its partners to redouble their efforts to create a world free of child labour.

Child labour: A dynamic global picture

  1. Child labour: What is to be abolished, and why?

A long history of ILO work against child labour

  1. The International Labour Organization, from its inception, has made child labour one of its central concerns.[4] ILO work on child labour over the decades has mainly taken its cue from the phrase “protection of children” in the Preamble to its Constitution. The ILO’s prime tool in pursuing the aboli­tion of child labour has always been, and remains to this day, the labour stand­ards that embody the concept of a minimum age to enter into employment. This approach responds to two concerns: to protect children from work that interferes with their full development and to pursue economic efficiency through well-functioning adult labour markets.
  2. Early minimum age standards were linked to schooling.[5] The Minimum Age Convention, 1973 (No. 138), which built on the ten instruments adopted before the Second World War, expresses this tradition by stating that the min­imum age for entry into employment should not be less than the age of com­pletion of compulsory schooling. By establishing such a link, the aim is to ensure that children’s human capital is developed to its fullest potential, ben­efiting children themselves, their families and communities and society as a whole by the increased contribution they can, when grown, make to economic growth and social development.
  3. Soon after the World Summit for Social Development, held in Copen- A growing consensus hagen in March 1995, had squarely identified the elimination of child labour as a key to sustainable social development and poverty reduction, the ILO Governing Body approved, in 1996, the development of a new ILO instrument on the subject. The aim of such an instrument was to consolidate the growing consensus, fuelled in part by the ILO’s own increasing work under its Inter­national Programme on the Elimination of Child Labour (IPEC),[6] that certain forms of child labour demanded urgent, immediate action for their prohibition and elimination. Preparatory work began in earnest for a new Convention and Recommendation;[7] and ideas for such instruments were subsequently dis­cussed within the ILO and at other international meetings in Amsterdam and Oslo the following year.
  4. In 1998, the adoption by the 86th Session of the International Labour Conference of the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up reconfirmed the effective abolition of child labour as one of the principles concerning the fundamental rights to be respected by all ILO member States, even if they had not ratified the fundamental Conven- tions.[8] At that same session of the Conference, debate began on the proposed new child labour instruments and, as witnessed by the Global March Against Child Labour, children themselves decried their treatment at work. The unan­imous adoption of the Worst Forms of Child Labour Convention, 1999 (No. 182), and its accompanying Recommendation (No. 190), marked yet another milestone in the movement against child labour. The momentum has since continued. The speed of ratification of Convention No. 182 is unparalleled in the history of the ILO (by 1 February 2002, 115 ratifications had been regis­tered) (see Annex 2). With these ratifications have come many more ratifica­tions of Convention No. 138, which had reached a total of 116 by the same date (see figure 1 and Annex 2).
  5. Meanwhile, IPEC’s expansion has accelerated; it now represents a coa­lition of almost 100 countries, including 26 donor governments and organiza­tions and more than 70 countries with active programmes to combat child labour (see Annex 3). The 89th Session of the International Labour Confer­ence in 2001 saw the launch of the latest development in IPEC – the first three time-bound programmes on the worst forms of child labour.[9] New data reveal­ing the extent of the worst forms of child labour confirm the priority that such programmes merit.
  6. These and other milestones along the way reflect the serious commitment and hard work of many groups and individuals within the ILO and outside it. Such efforts form part of the dynamic global picture to be presented in this Re­port. However, let us first consider the meaning of the term child labour, the effective abolition of which is called for in the ILO Declaration.

What do we want to abolish?

  1. While the principles of the ILO Declaration do not equate with the more detailed provisions of the fundamental Conventions of the ILO, there is a def­inite link between the two.[10] Conventions Nos. 138 and 182 establish the boundaries of the work by children that is targeted for effective abolition.
  2. The term child labour does not encompass all work performed by chil­dren under the age of 18. Millions of young people legitimately undertake work, paid or unpaid, that is appropriate for their age and level of maturity. By so doing, they learn to take responsibility, they gain skills and add to their families’ and their own well-being and income, and they contribute to their countries’ economies. Child labour does not include activities such as helping out, after school is over and schoolwork has been done, with light household or garden chores, childcare or other light work. To claim otherwise only trivi­alizes the genuine deprivation of childhood faced by the millions of children involved in the child labour that must be effectively abolished.
  3. Child labour slated for abolition falls into the following three categories:
  • Labour that is performed by a child who is under the minimum age specified for that kind of work (as defined by national legislation, in ac­cordance with accepted international standards), and that is thus likely to impede the child’s education and full development.
  • Labour that jeopardizes the physical, mental or moral well-being of a child, either because of its nature or because of the conditions in which it is carried out, known as hazardous
  • The unconditional worst forms of child labour, which are interna­tionally defined as slavery, trafficking, debt bondage and other forms of forced labour, forced recruitment of children for use in armed conflict, prostitution and pornography, and illicit activities.
  1. Under the Declaration, the elimination of all these forms of child labour has become the shared goal of every one of the ILO’s 175 member States. It is also an objective of the Organization as a whole, which has pledged, in the same instrument, to assist its Members to realize the principle of the effective abolition of child labour. This is the focus of IPEC. The prohibition of child labour applies to a wide range of economic and non-economic activities; pol­icy responses must be designed accordingly. To take an extreme example, the measures to rescue a 7-year-old being used as a “mule” in the drugs trade will have little in common with those to prevent a school-going teenager undertak­ing some additional, but unlawful, hours of work in an office job.
  2. Figure 2 illustrates the basic distinctions embodied in Conventions Nos. 138 and 182. It shows that it is the interaction between the type of work and the age of the child involved that defines the boundaries of child labour for effective abolition.

Shaded area = child labour for abolition

The minimum age for admission to employment or work is determined by national legislation and can be set at 14, 15 or 16 years.

  • The minimum age at which light work is permissible can be set at 12 or 13 years.
  • For example, household chores, work in family undertakings and work undertaken as part of education.
  1. Let us turn first to the concept of minimum age for admission to employ­ment or work. With the aim of abolishing child labour, national legislation should fix a minimum age or ages at which children can enter into different kinds of work. Within limits, these ages may vary according to national social and economic circumstances. The general minimum age for admission to em­ployment should not be less than the age of completion of compulsory school­ing and should not be less than 15 years; but 16 years is the general minimum age to which countries should aspire. Developing countries may make excep­tions to this and may apply a minimum age of 14 years. Light work that is com­patible with a child’s schooling may be allowed from age 12. Children who engage in work when they have not yet attained the minimum age specified for it are classed as child labourers.

The worst forms of child labour

  1. The adoption of Convention No. 182 helped to focus the spotlight on the urgency of action to eliminate, as a priority, the worst forms of child labour, which it defines as:
  • all forms of slavery or practices similar to slavery, such as the sale and trafficking of children, debt bondage and serfdom and forced or compul­sory labour, including forced or compulsory recruitment of children for use in armed conflict;
  • the use, procuring or offering of a child for prostitution, for the produc­tion of pornography or for pornographic performances;
  • the use, procuring or offering of a child for illicit activities, in particular for the production and trafficking of drugs as defined in the relevant in­ternational treaties;
  • work which, by its nature or the circumstances in which it is carried out, is likely to harm the health, safety or morals of children (Article 3).
  1. A distinction can be drawn between two categories of the worst forms of child labour:
  • those that this report terms the “unconditional” worst forms of child la­bour, referred to in Article 3(a)-(c) of Convention No. 182 above, that are so fundamentally at odds with children’s basic human rights that they are absolutely prohibited for all persons under the age of 18;
  • hazardous work, as defined by national legislation, that may be con­ducted in legitimate sectors of economic activity but that is nonetheless damaging to the child worker.
  1. These worst forms of child labour entail violations of children’s rights that demand immediate action for their prohibition. For example, as current and former child labourers recently reported to IPEC, they were “sometimes beaten by their employers and exposed to physical injuries at work, denied wages, forced to work long hours and sexually abused”.[11]
  2. However, such forms of exploitation of children also highlight the neces­sity of effective poverty reduction measures and long-term, sustained eco­nomic growth for their prevention. It is abundantly clear that the poverty conundrum at the very heart of this problem – where poverty breeds the worst forms of child labour and the worst forms of child labour breed poverty – must be tackled head on.
  3. The concept of the worst forms of child labour helps to focus attention on children, as well as on the work they perform. These forms of child labour are not only the most intrinsically harmful, they are also the ones that are per­formed by the most vulnerable children.[12] The boundaries of hazardous work are therefore not always easy to draw, especially when the harm being done to children is not obvious in the short term. Hazardous work had already been singled out in Convention No. 138 as requiring a minimum age for admission of 18 years or older (Article 3(1)). Its identification as a worst form of child labour adds impetus to the drive to eliminate it.
  4. Work may harm a child through the task itself, the tools used, the hours or conditions of work, or any other factor that affects his or her physical, men-tal, emotional, psychological, moral or spiritual development. Health and safety hazards for workers under the age of 18 are greater than those for adults. Because of their process of growth and development, children are more sus­ceptible to occupational hazards; and exposure to dust, chemicals and other substances, as well as physical strain, can cause irreversible damage to their growing bodies.[13] Chronic physical strain on growing bones and joints causes stunting, spinal injury and other lifelong deformation. Moreover, tasks that are harmless for well-built, well-fed children may harm those who are malnour­ished.
  1. Even seemingly light work can be dangerous for children who are ex­hausted at the end of a long working day. Lack of maturity and experience may lead children to take or accept risks that their older colleagues would know to avoid, and machinery and tools designed with adults in mind are unlikely to be adapted to the physical and mental capacities of younger workers. There may be other, less obvious but nonetheless debilitating effects on children of work that, at first sight, appears innocuous, such as heatstroke incurred through long hours herding animals or exposure to agrochemicals through vegetable cultivation.

Need for more medical 37. The physiological damage from exposure to different substances and evidence work processes is relatively well known for adult workers,[14] but more needs to be learned about the short- and long-term effects of different types of work on girls and boys of various ages and health status.[15] Such understanding is needed in order to decide what types of work to prohibit for children under the age of 18 and to plan for appropriate rehabilitation of children who are with­drawn from hazardous work. More detailed scientific evidence may well reveal there to be more hazardous forms of work for children than was initially be­lieved, in all countries, whatever their levels of development.

Occupational injury and 38. The rates of occupational injury and death reveal the consequences of the death among children hazards faced by workers under the age of 18. Statistics are patchy but evi­dence can be found in studies in developed countries, which have examined hospital records and awards under workers’ compensation schemes. In the United States, the rate of injury per hour worked appears to be almost twice as high for children and adolescents as it is for adults. Rates of work-related deaths of young workers during 1992-98 in the United States were highest in agriculture, forestry and fishing, followed by retail trade and construction.[16] A survey of children aged 13-17 in Denmark, Finland, Norway and Swe­den in 1997-98, revealed injury rates ranging from 3 to 19 per cent for children working before or after school.[17] In Denmark, the accident rate among chil­dren working in agriculture is reportedly higher than it is in other sectors.[18] A number of developed countries have referred to statistics of occupational in­juries and deaths of workers under the age of 18 in their annual reports under the follow-up to the Declaration, including Australia, New Zealand and the

United States. The ILO itself has conducted surveys on work-related injuries and illnesses sustained by children. A study in 1997 in selected developing countries revealed the following average rates of illness and injury among working children by economic sector: 25.6 per cent in construction (34.8 per cent for girls), 18.1 per cent in transport, storage and communication, 15.9 per cent in mining and quarrying (20.8 per cent for girls) and 12.2 per cent in ag­riculture (15.5 per cent for girls).[19] In all these sectors, with the exception of transport, rates were significantly higher for girls than they were for boys.

  1. While information on this subject is not sufficient, what we do have clearly indicates that children and adolescents are highly susceptible to ill­ness, injury and even death through hazardous work in developing, transition and developed countries alike.

Evolving attitudes towards children

  1. Perceptions of children have evolved over time: children are now viewed less as passive objects of adult concern and more as human beings with rights of their own. It is of course true that concepts about children and childhood, including what is allowed and expected of children of different ages, maturity and gender, vary widely across and within countries and cultures; there is no “universal” child. In industrialized countries, for example, some teenagers are not expected even to look after themselves, while in many poor countries, quite young children shoulder considerable responsibility within the house- hold.[20] Indeed, as we will see later in this report, in those parts of the world most affected by HIV/AIDS, alarming numbers of children are becoming de facto heads of households, taking full responsibility for the well-being of their younger siblings.
  2. Yet there has been, over recent years, an undoubted convergence of thinking about children, marked by the adoption in 1989 of the United Nations Convention on the Rights of the Child (CRC), now almost universally ratified. Amongst many other rights,[21] it recognizes “the right of the child to be pro­tected from economic exploitation and from performing any work that is likely to be hazardous or to interfere with the child’s education”, and it endorses the ILO concept of a minimum age. It thus confirms the ILO’s long-standing recognition of children’s particular vulnerability to exploitative work because of their powerlessness compared to adults and hence the inability to protect their own interests.[22] The CRC also defines a child as “every human being be­low the age of eighteen years” and sets the seal on children’s right to parti­cipate and to have their views taken into account in matters that affect them.[23]

[1] ILO: Stopping forced labour, Report of the Director-General, International Labour Conference, 89th Session, Geneva, 2001.

[2] The Copenhagen Declaration on Social Development and Programme of Action of the World Summit for Social Development (1995), Commitment 3(i).

[3] The ILO Declaration applies to all member States of the ILO, whether or not they have ratified the Conventions relating to each category of principles concerning fundamental rights. Under the follow-up to the Declaration, a Global Report is to be drawn up each year under the responsibility of the Director- General and to cover one of the four categories of fundamental principles and rights in turn. The purpose of this Global Report is to provide a “dynamic global picture” of the situation and to serve as a basis for assessing the effectiveness of technical assistance and technical cooperation provided by the ILO, and as a basis for the ILO Governing Body to determine technical cooperation priorities and plans of action for the following four-year period.

[4] Two child labour instruments were among the six adopted at the First Session of the International La­bour Conference in 1919: the Minimum Age (Industry) Convention, 1919 (No. 5), and the Night Work of Young Persons (Industry) Convention, 1919 (No. 6).

[5] For example, the Minimum Age (Sea) Convention, 1920 (No. 7), the Minimum Age (Agriculture) Con­vention, 1921 (No. 10), and the Minimum Age (Non-Industrial Employment) Convention, 1932 (No. 33).

[6] IPEC was established in 1992 with an initial grant from the Government of Germany. It built on work undertaken by an earlier interdepartmental project of the ILO.

[7]  ILO: Child labour: Targeting the intolerable, Report VI (1), International Labour Conference, 86th Session, Geneva, 1998.

[8] After the Copenhagen World Summit for Social Development in 1995, the ILO reclassified the Min­imum Age Convention, 1973 (No. 138), which only a few years previously had been seen as a technical ILO standard, as a basic human rights instrument (one of the fundamental Conventions).

[9] Time-bound programmes were launched in El Salvador, Nepal and the United Republic of Tanzania, with financial assistance from the Government of the United States. Similar programmes are being pre­pared in 15 additional countries.

[10]         The link is explained in paragraph 1(b) of the ILO Declaration on Fundamental Principles and Rights at Work.

[11] IPEC: Project document: Supporting the Time-Bound Programme on the worstforms of child labour in the United Republic of Tanzania (Geneva, ILO, 2001), subsection 1.3.4.

[12] See, for example, ILO: Child labour, Report IV (2A), International Labour Conference, 87th Session, Geneva, 1999, reply received from the United States, p. 17.

[13] V. Forastieri: Children at work: Health and safety risks (Geneva, ILO, 1997), p. 10.

[14]  ILO: Encyclopaedia of occupational health and safety, 4th ed., 4 vols. (Geneva, ILO, 1998).

[15] An example of what has been done can be found in N. Burra: Born to work: Child labour in India (New Delhi, Oxford University Press, 1995).

[16] P.J. Landrigran et al.: “Child labour in the United States: Historical background and current crisis”, in The Mount Sinai Journal of Medicine (New York, Mount Sinai Hospital), 1992, Vol. 59, No. 6, pp. 498-503.

[17]  G.L. Rafnsdottir: Barn- och ungdomsarbete I Norden [Child and youth work in Nordic countries] (Co­penhagen, Nordic Council, 1999).

[18] ILO: Note on the Proceedings, Tripartite Meeting on Moving to Sustainable Agricultural Develop­ment through the Modernization of Agriculture and Employment in a Globalized Economy, Sectoral Ac­tivities Programme (TMAD/2000/13), Geneva, 18-22 September 2000. Statement by the representative of the Government of Denmark, p. 23.

[19]  K. Ashagrie: Statistics on working children and hazardous child labour in brief (Geneva, ILO, 1997), table 6.

[20] As reflected, for example, in the way the rights and responsibilities of children are considered in the African Charter on the Rights and Welfare of the Child (Organization of African Unity, 1990).

[21] The rights of the child in the United Nations Convention on the Rights of the Child (CRC) can be grouped under survival and development rights, protection rights and civil and political rights.

[22] ILO: Report of the Director-General, International Labour Conference, 69th Session, Geneva, 1983,

  1. 12.

[23] A good summary of the extensive literature on children’s participation appears in R. Hart: Childrens participation: From tokenism to citizenship (New York, UNICEF International Child Development Cen­tre, 1992). The Worst Forms of Child Labour Recommendation, 1999 (No. 190), which accompanies Convention No. 182, reflects recognition of children’s right to participate: “the programmes of action … should be designed and implemented … taking into consideration the views of the children directly af­fected by the worst forms of child labour, their families and, as appropriate, other concerned groups …” (Paragraph 2).