Agreement on the IT Service Centre of the Cantons of Obwalden and Nidwalden - Name, Legal Nature, Headquarters

1. The cantons of Obwalden and Nidwalden establish a public institution under the name "Information Technology Service Center Obwalden - Nidwalden (ILZ)" with its own legal personality and headquarters in Sarnen.

2. The ILZ is independent in its organization and operational management; it maintains its own accounts.

1. The ILZ

a) * provides IT services for those organizations for which the Agreement on Cooperation in the Field of Informatics[1] applies;

b) * may execute orders for third parties, provided that there are no qualitative and financial disadvantages for the contracting cantons.

c) * ...

1. The ILZ provides, in particular, the following IT services

a) * it assumes all functions of the IT service center according to the agreement on cooperation in the field of informatics;

b) * it develops guidelines for the use of information and communication technologies within the framework set by the governments;

c) it ensures data security in its area as well as compliance with data protection regulations;

d) * it advises the personnel of clients on questions regarding the use of IT and offers training programs;

e) * it ensures the operation of IT applications and systems (data processing, information, and communication systems) that are of central importance;

f) * it receives and processes the orders from clients;

g) it operates one or more data centers, particularly for the handling of applications according to letter e;

h) * it can provide audit services in favor of the clients.

i) * ...

2. It may be entrusted with additional tasks by the clients, such as strategy development, financial planning, and project processing.

3. The ILZ may outsource IT services to third parties. The outsourcing of services of strategic importance or with corresponding macroeconomic impacts requires the approval of the governments of the contracting cantons. The ILZ remains responsible for the fulfillment of these tasks.

4. ...

1. The signatory cantons shall provide the ILZ with an initial capital contribution of CHF 500,000 each for the commencement of operations, which is to be interest-bearing by the ILZ.

2. ...

2a. The interest to be paid to the canton shall be determined based on the yield of the ten-year federal bonds as of January 1 of the fiscal year, plus a surcharge of 0.5 percent, and shall amount to at least 3.0 percent and at most 5.5 percent. The interest rate is rounded to one decimal place. The interest payment is due on January 31 of the fiscal year.

3. The signatory cantons may grant loans to the ILZ, which are to bear interest at market conditions.

1. Each contracting canton may delegate two members from its cantonal parliament to the interparliamentary audit committee.

2. The committee shall constitute itself.

3. It shall fulfill its duties by

a) giving its opinion on the annual report, the annual financial statements, and the audit report before their approval by the governments of the contracting cantons;

b) informing the cantonal parliaments of the contracting cantons about the implementation of services within the framework of the audit;

c) being informed by the board of directors about the activities of the ILZ.

1. The Governments of the Participating Cantons

a) * elect the members of the Board of Directors of the ILZ for a term of four years and appoint a President from among them;

b) designate the audit firm;

c) annually approve the annual report and, based on the audit report, the financial statements of the ILZ;

d) * ...

1. The Bodies of the ILZ are

a) the Administrative Board;

b) the Executive Management;

c) the Audit Office.

1. The Administrative Board of five members is composed of

a) two members elected by each of the two governments;

b) the fifth member jointly designated by the two governments upon the request of the four members.

2. The Administrative Board constitutes itself with the exception of electing its presidium. It establishes its rules of procedure, which specifically regulate decision-making, the authority to sign documents, and the compensation of its members.

3. The Executive Director of the ILZ has an advisory role and the right to submit proposals.

1. The Board of Directors

a) is responsible for the organization and operation of the ILZ;

b) approves the budget of the ILZ;

c) exercises direct supervision over the management;

d) prepares the annual report and financial statement and reviews the audit report;

e) informs the Inter-Parliamentary Business Audit Commission and the governments of the contracting cantons annually about the execution of services and orders, as well as the audit report;

f) appoints the director of the ILZ;

g) issues personnel regulations in accordance with Article 14 of this agreement.

1. The Management fulfills its duties by specifically

a) being responsible for the business operations;

b) executing the orders issued by the ILZ;

c) ensuring controlling and reporting;

d) concluding public-law employment contracts with employees;

e) accounting to the Board of Directors;

f) preparing the business of the Board of Directors.

2. The Management is furthermore vested with all powers that are not assigned to another body. It may further delegate the powers vested in it.

1. The audit authority shall annually examine the accounts in accordance with statutory regulations and recognized auditing standards, as well as the correctness of the performance and effect data.

2. It shall report and make recommendations to the board of directors.

1. The ILZ ensures through organizational and technical measures that the Federal data protection regulations and the agreements of the cantons are complied with and that data security is guaranteed at all times.

1. The ILZ employs its staff in accordance with the public law provisions of the legislation of the Canton of Obwalden. It may deviate from these in terms of working hours, salary, premiums, and allowances if special circumstances justify it.

2. Disputes are decided by the Administrative Court of the Canton of Obwalden.

1. All employees of the ILZ, as well as any auxiliary persons involved, are subject to official secrecy in accordance with the provisions of the State Administration Act of the Canton of Obwalden.

1. Liability of the ILZ as well as the responsibility of its organs and personnel for sovereign activities are governed by the provisions of the legislation of the Canton of Obwalden. The competent authority for decision-making is the Administrative Court of the Canton of Obwalden.

2. In all other cases, federal civil law applies.

1. The ILZ prepares an annual financial statement. This consists of the balance sheet, the income statement, and the notes.

2. The annual financial statement shall be prepared in accordance with the provisions of the Swiss Code of Obligations regarding the proper accounting of corporations. More extensive financial reporting is permissible.

1. For services, market prices are charged, which generally must cover costs and allow for a reasonable profit. This is assessed with regular price benchmarks.

2. If the provisional annual financial statements show an annual profit of more than 10 percent of the endowment capital and the general reserves can be covered, price discounts based on the ordered user services must be granted to the two cantons and the municipalities, charged to the same annual financial statements.

1. The annual result determined after deducting additional depreciation on fixed assets and price discounts is used for

a) * the creation of general reserves to cover potential losses until the amount reaches 30 percent of the endowment capital;

b) * the creation of free reserves;

c) * any potential profit carried forward to the next fiscal year.

2. The free reserves can be utilized

a) for financing activities within the framework of fulfilling and improving the service mandate;

b) for distributions, half of which go to the contracting cantons, provided that the general and free reserves together exceed 50 percent of the endowment capital.

1. The ILZ is exempt from all cantonal and municipal taxes for its activities in fulfilling the orders of the agreeing cantons and municipalities.

1. The agreement is valid for an indefinite duration.

2. The governments of the cantons party to the agreement may terminate it by giving two years' notice to the end of a year, for the first time on December 31, 2027.

3. In the event of termination, the detailed exit modalities are to be separately regulated between the ILZ and the cantons party to the agreement.

1. Upon dissolution of the agreement, assets and liabilities shall be divided among the contracting cantons in accordance with the actual benefits received over the past four years.

2. Each canton is jointly and severally liable for the obligations of the ILZ incurred during its membership.

1. Disputes between the agreeing cantons are decided by an arbitration tribunal.

2. The arbitration tribunal consists of five members. Each party to the dispute appoints two representatives. Together, they additionally appoint a president.

3. The procedure is correspondingly governed by the regulations on arbitration in the Swiss Code of Civil Procedure (Code of Civil Procedure, CPC).

1. This agreement shall enter into force on January 1, 2002, following approval by the constitutionally competent authorities.