EN ECB -PUBLIC  
 
 
OPINION OF THE EUROPEAN CENTRAL BANK  
of 26 September 2016  
on amendments to the Book Entry Securities Act  
 (CON/2016/ 46) 
 
Introduction and legal basis  
On 26 August 2016 the European Central Bank (ECB) received a request from the Slovenian Ministry of 
Finance for an opinion on amendments to the Book Entry S ecurities  Act1 (hereinafter the ‘draft law’).  
The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and the fifth indent of Article  2(1) of Council Decision 98/415/EC2, as 
the draft law relates to payment and settlement systems.  In accordance with the first sentence of Article 
17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this  
opinion.  
 
1. Purpose of the draft  
1.1 The main objective of the draft law is to establish rules facilitating auto- collateralisation within the 
Target2 Securities (T2S) platform by transferring book -entry securities to an account pledged in 
favour of Banka Slovenije. The draft law’s explanatory memorandum indicates that under the 
current Book Entry Securities Act3, a pledge over book -entry securities can only be established on 
the basis of a unilateral order entered in the system by a member of  a central securities depository 
(CSD ). For successful auto- collateralisation, the pledgee must also be able to create a pledge. 
The draft law takes into account the fact that T2S cannot accommodate multiple liens over book -
entry securities.  
1.2 The draft law amends the current B ook Entry Securities Act to provide for the creation and deletion 
of pledges over book -entry securities with and without the transfer of dematerialised securities 
between accounts. The creation and deletion of such pledges involv ing a transfer between the 
accounts of different holders  can only be accomplished by a bilateral order.  
1.3 When entering a transfer ring part of an order  for the transfer of book -entry securities , their holder 
may give prior authoris ation  to the member of the CSD  authorised to enter the receiving part of the 
order on behalf of the acquirer . Such prior authorisation may only be given for book -entry securities 
                                                 
1  Zakon o spremembah in dopolnitvah zakona o nematerializiranih vrednostnih papirjih.  
2  Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central B ank by national 
authorities  regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).  
3  Zakon o nematerializiranih vrednostnih papirjih (ZNVP- 1) (Ur. l. RS No 75/15) . 
ECB -PUBLIC  
2 on a specially marked account of the holder and is only valid for book -entry securities on this 
account.  
1.4 The draft law further pr ovides that if, in accordance with the holder’s request when entering the ir 
pledge over the book -entry securities, the member of the CSD authorised  by the pledgor  is 
replaced by a member authorised by the pledgee, the pledge is then created on the basis of  a 
bilateral order. T he holder may give prior authoris ation for  a member of the CSD to create the 
pledge. Such prior authorisation may only be given for book -entry securities on a specially marked 
account of the holder and is  only valid for book -entry securities on this account.  The draft law 
provides that a book -entry security may not be encumbered on multiple occasions, nor may a 
pledge be established over  an already encumbered book -entry security.  
 
2. General observations  
2.1 The ECB welcomes the amendm ents proposed by the draft law, which will further align the 
Slovenian legal framework with T2S requirements for successful auto- collateralisation and facilitate 
the smooth integration of the Slovenian CSD into T2S.  
2.2 The ECB understands that in the cont ext of T2S auto- collateralisation, Banka Slovenije is in a 
position to be simultaneously  both a member of the CSD, authorised in advance to enter the 
transferring part of the order , and the acquirer (i.e., the entity which obtains a pledge over the 
securit y), authorised to enter the receiving part of the order. Consequently, T2S auto-
collateralisation transactions are executed in favour of Banka Slovenije automatically in line with 
T2S’s functionalities without any additional intervention by Banka Slovenije or other CSD members. 
The ECB further understands that by referring to the specially marked account of the holder, the 
draft law refers to the account pledged in favour of Banka Slovenije.  
 
This opinion will be published on the ECB’s website.  
  
Done at F rankfurt am Main, 26 September  2016.  
 
[signed]  
 
The President of the ECB  
Mario DRAGHI