EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 21 May 2008  
at the request of Česká národní banka 
on a draft law on Česká národní banka 
(CON/2008/21) 
 
Introduction and legal basis  
On 6 March 2008 the European Central Bank (ECB) received a request from Česká národní banka ( ČNB) 
for an opinion on a draft law on Česká národní banka (hereinafter the ‘draft law’). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the first, second, third, f ourth and fifth indents of Article 2(1) of Council 
Decision 98/415/EC of 29 June 1998 on the consulta tion of the European Central Bank by national 
authorities regarding draft legislative provisions1, as the draft law relates to currency matters, means of 
payment, Česká národní banka, the collection, compilati on and distribution of monetary, financial, 
banking, payment systems a nd balance of payment statistics, and 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 law 
The main purpose of the draft law, which is to take e ffect on the date of the adoption of the euro in the 
Czech Republic, is to bring national legislation on ČNB’s status, competences and activities in line with 
the Treaty, the Statute of the Euro pean System of Central Banks and of the European Central Bank 
(hereinafter the ‘ESCB Statute’) and other relevant Comm unity legislation, in particular with regard to the 
legal integration of ČNB into the Eurosystem. Given the scope and number of changes required in this 
regard, the Czech authorities have decided that the pr oposed legislation should take the form of a new law 
on ČNB. In the meantime, the currently appli cable law, i.e. Law No 6/1993 Coll., on Česká národní 
banka, which was amended several times in recent years (hereinafter the ‘current law on ČNB’), will 
remain in force until the date of the adop tion of the euro in the Czech Republic.   
 2. General observations 2.1 The ECB welcomes the Czech authorities’ e fforts to achieve the required level of legal 
convergence. The draft law addresses several of the issues raised by the ECB in its December 2006 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2 Convergence Report2. However, it is important to reiterate  that, pursuant to Article 109 of the 
Treaty, ‘each Member State shall ensure, at the lat est at the date of the establishment of the ESCB, 
that its national legislation including the statutes of  its national central bank is compatible with this 
Treaty and the Statute of the ESCB’. Thus, the C zech Republic was already obliged to ensure the 
compatibility of its national legislation as of the date  of its entry into the European Union, i.e. on 
1 May 2004. In the past, the ECB has identified in consistencies between Cz ech national legislation 
in the areas of central bank independence, confidentiality and the prohibition on monetary financing and privileged access, on the one hand, and the relevant provisions of the Treaty and the 
ESCB Statute, on the other hand; so far these incons istencies have not been removed, nor will they 
be removed altogether should the draft law be adopted. A different deadline applies, however, to 
the statutory requirements relating to the full legal integration of ČNB into the Eurosystem, which 
only need to enter into force at the moment that full integration becomes effective, i.e. the date on 
which the Czech Republic adopts the euro
3.   
2.2 In the light of the above, adopting a new central banking law, which will only become wholly 
effective on the date of the adoption of the euro  in the Czech Republic, raises certain concerns. 
First, since the current law on ČNB will remain in force until the date of the Czech Republic’s 
adoption of the euro, the existing incompatibiliti es identified in the ECB’s Convergence Reports, 
other than those related to its legal integration into the Eurosystem, will remain unresolved. This 
will constitute an ongoing breach of the Treaty obl igation referred to in the preceding paragraph. 
Given that it is yet not known when the Czech Re public will adopt the euro, this situation could 
persist for some time4. Therefore, the provisions of the draft law addressing known 
incompatibilities of the current law on ČNB that do not refer to the integration of ČNB into the 
Eurosystem should become effective immediately on adoption of the draft law.  
2.3 Second, the fact that there could be a long inte rval between the adoption of the draft law and its 
coming into effect may present a number of pract ical difficulties. For instance, the draft law 
currently contains numerous references to various  Community legal acts of relevance to its scope 
of application. By the time the draft law beco mes effective, some of these references may be 
outdated as the legal acts in question may have been amended or replaced, thereby necessitating 
amendments to the adopted law before it comes into effect.  
2.4  Finally, some of the provisions of the draf t law repeat directly applicable Community law 
provisions. In the ECB’s view, this is unnecessary since, as stated on previous occasions, directly 
applicable Community law provisions do not n eed to be ‘transposed’ into domestic law5.  
 
                                                 
2  See the ECB’s Convergence Report of December 2006, p. 210-212.  
3  See the ECB’s Convergence Report of May 2007, p. 24.  
4  So far, the Czech Government has not set an of ficial target date for the adoption of the euro. 
5  See, for example, ECB Opinion CON/2007/43 of 19 December 2 007 at the request of the Slovak Ministry of Finance on 
a draft law on the introduction of the euro in  Slovakia and on amendments to certain laws. 
3 3. Specific observations 
3.1 Provisions concerning ESCB-related activities  Coin issuance 3.1.1 Article 4(2)(b) of the draft law recognises ČNB’s power to issue euro  coins within the Czech 
Republic
6. While this provision contains a footnote re ference to Article 106(2) of the Treaty, ČNB 
may consider inserting in Article 4(2)(b) an exp licit reference to the powers of the Council and the 
ECB in relation to the issuance of euro coins and the approval of the volume thereof, respectively, 
following the example of Article 4(2)(a) of the draft law, which refers explicitly to the ECB’s 
powers over the issuance of euro banknotes.     
Minimum reserves 3.1.2 Article 30(1) of the draft law provides for ČNB’s contribution to the application of the ESCB’s 
minimum reserve system, while Article 30(2) of the draft law refers to the exercise of the ECB’s right to collect and verify information relating to minimum reserves. The ECB notes that, while the wording of Article 30(1) is unobjectionable (subject , nevertheless, to the insertion of a proviso 
specifying that, in the pursuit of its  minimum reserve-related activities, ČNB must act in 
accordance with the relevant ECB regulations and guidelines), Article 30(2) is unduly restrictive 
and not strictly necessary in view of Article 30(1). Therefore, ČNB may consider deleting 
Article 30(2) of the draft law. 
Management of foreign reserve assets  
3.1.3 Article 31(2) of the draft law authorises ČNB to decide on the amount of its own foreign reserve 
assets and determine the investment rules. The ECB would like to draw atten tion to Article 31.2 of 
the ESCB Statute on foreign reserve assets held by  national central banks (NCBs), providing that 
all operations in foreign reserve assets remaining with the NCBs after the transfer of foreign reserve assets to the ECB in accordance with Artic le 30 of the ESCB Statute must, above a certain 
limit to be established within the framework of Ar ticle 31.3 of the ESCB Statute, be subject to the 
ECB’s approval to ensure consistency with th e exchange rate and monetary policies of the 
Community. To this end, an explicit reference to  Article 31 of the ESCB Statute and to the legal 
framework adopted on the basis thereof would be warranted
7. 
Banknote and coin reproduction rules 3.1.4 Article 36(b) of the draft law authorises ČNB to stipulate, by means of a decree, the terms and 
conditions under which banknotes a nd coins may be reproduced and under which objects imitating 
them may be produced. In this regard, ČNB is invited to consider including a reference to the 
ECB’s reproduction rules for euro banknotes, as laid down in Decision ECB/2003/4 of 
                                                 
6  See also Article 35(1)(a) of the draft law. 
7  See also ECB Opinion CON/2006/17 of 13 March 2006 at the requ est of the Slovenian Ministry of Finance on a draft law 
amending the Law on Banka Slovenije. 
4 20 March 2003 on the denominations, specifications , reproduction, exchange and withdrawal of 
euro banknotes8. 
Provisions concerning the powers of ČNB in the field of statistics 
3.1.5 Article 38(1) of the draft law refers to ČNB’s contribution to the compilation and production by the 
ECB and Eurostat, of Community statistics, stating that ČNB ‘shall transmit statistical information 
and individual data to the European Central Bank an d Eurostat’. To the extent that this provision 
suggests that ČNB is under a legal obligation to transmit st atistical information to Eurostat (other 
than balance of payments and international invest ment position statistics, in connection with which 
ČNB is the competent national authority in the Cz ech Republic), despite the fact that it is not a 
member of the European Statistical System, ČNB may wish to reconsider the drafting of this 
provision.  
3.1.6 Article 45(2) of the draft law, referring to the tr eatment of confidential statistical data, provides that 
where statistical information is created by aggreg ating individual data for less than three reporting 
agents, ČNB may provide such information only as confidential data intended exclusively for 
statistical purposes and these data may only be publ ished with such reporting agents’ consent. The 
ECB notes that Article 8 of Council Regulation (EC) No 2533/989 on the confidentiality regime for 
ECB statistics, which takes precedence over Article 45 (2) of the draft law, contains no such explicit 
restriction  and would invite ČNB to consider the relationship between Article 45(2) and Article 8 
of Regulation (EC) No 2533/98 to the extent, at least, that the former would also apply to ECB 
statistics.   
 3.2 Other issues Bank Board member eligibility criteria and termination of office  3.2.1 The wording of Article 16(1) of the draft la w, listing the reasons for which a Bank Board 
member’s office terminates
10, is not fully aligned with that of Article 14.2 of the ESCB Statute 
and should be modified accordingly. 
In addition, the wording of Article 16(2) whic h contains the grounds for dismissal of a Bank 
Board member should also be aligned with Article 14.2 of the Statute. In particular, the wording 
‘if the Governor no longer fulfils the conditions  required for the performance of his office 
stipulated by law’ should be replaced by ‘if the Governor no longer fulfils  the conditions required 
for the performance of his duties as for eseen in Article 14.2 of the Statute’. 
                                                 
8  OJ L 78, 25.3.2003, p. 16. 
9  Council Regulation (EC) No 2533/98 of 23 November 1998 con cerning the collection of stat istical information by the 
European Central Bank, OJ L 318, 27.11.1998, p. 8.  
10  In particular, a Bank Board member’s office terminates on: (i ) the expiration of the term of office; (ii) resignation; 
(iii) taking up an incompatible office (see Article 15(1) of th e draft law); (iv) the expiration of two months from the day 
on which written notice of relief from office is delivered unless the Bank Board member (or the Governing Council in 
case of the Governor) relieved from office seeks judicial revi ew within this period; (v) entry into force of a judgment 
depriving the Bank Board member of competence to perform legal acts or limiting their competence to perform legal 
acts; and (vi) entry into force of a judgment convicting the Bank Board memb er of a wilful criminal offence. 
5 Legislative powers 
3.2.2 Article 52(1) of the draft law11 provides for the joint competence of ČNB and the Czech Ministry 
of Finance to prepare and submit to the Gove rnment draft legislation on currency, money 
circulation, the money market and the status, competence, organisation and activities of ČNB as the 
central bank of the Czech Republic. Under Article 52(2) of the draft law, ČNB assists the Ministry 
of Finance in preparing draft legislation on th e financial market, payments, the regulation of 
electronic money and foreign exchange management  and the law on the introduction of the single 
currency in the Czech Republic. The ECB considers that Article 52 of the draft law should be amended to provide that the respective legislative powers of ČNB and the Ministry of Finance are 
without prejudice to the powers of relevant EU authorities in this field.   
Auditing 3.2.3 Pursuant to Article 60(2) of the draft law, the accounts of ČNB ‘shall be audited by an independent 
auditor in accordance with the Statute’. Article 27( 1) of the ESCB Statute requires that the accounts 
of the Eurosystem NCBs be audited by auditors that are independent and external. In order to 
comply with the ESCB Statute, Article 60(2) should  therefore be amended to state that the auditor 
appointed to audit ČNB’s accounts should also be an ‘external’  auditor, in line with Article 27(1) 
of the ESCB Statute
12.   
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 21 May 2008.  
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
11  Article 52 of the draft law largely mirrors the wording of  the proposed amendment of Article 37 of the current law on 
ČNB, which was the subject of a recent consultation with  the ECB – see ECB Opinion CON/2008/2 of 7 January 2008  at 
the request of the Czech Ministry of Finance on a draft law concerning the distribution of powers between the Ministry of 
Finance and Česká národní banka to prepare and submit certain draf t laws to the Government. The ECB understands that 
the proposed amendment is currently being discussed in the G overnment and that the wording of Article 52 of the draft 
law will be adjusted to reflect the final wording of the draft amendment.  
12  See, for example, ECB Opinion CON/2006/4 of 27 January 2006 at the request of the Central Bank of Cyprus on a draft 
law amending the Central Bank of Cyprus Laws of 2002 and 2003.