EN ECB-PUBLIC 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 20 April 2011 
on amendments to the governance struct ure of the Oesterreichische Nationalbank 
(CON/2011/38) 
 
Introduction and legal basis  
On 15 March 2011, the European Central Bank (ECB) received a request from the Austrian Ministry of 
Finance for an opinion on a draft law amending th e Law on the Oesterreichisc he Nationalbank and the 
Law on the Financial Market Supervisory Au thority (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 third indent  of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Central Bank by national authorities regarding draft 
legislative provisions1, as the draft law relates to the Oesterreichische Nationalbank (OeNB). 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 
1.1 Recently, the Austrian Federation became the OeNB ’s sole shareholder. The draft law therefore 
amends the Law on the OeNB to reflect its actual ownership structure. The shareholder rights will 
be exercisable by the Federal Minister for Finance. 
1.2 As a consequence of the changes to the shareholde r structure, the draft law amends the composition 
and organisation of the OeNB’s General Council
2 (hereinafter the ‘General Council’). The General 
Council is charged with the superv ision of all business falling outside the remit of the European 
System of Central Banks. It will advise the OeNB’s Governing Board on the conduct of the 
OeNB’s business and in matters of monetary polic y. The draft law reduces the number of members 
of the General Council from 14 to 10. In future , all members of the General Council shall be 
appointed by the Federal Government. At the pr esent time, only the President, the Vice President 
and six other members of the General Council have  been appointed. The remaining six members of 
the General Council are elected by the General As sembly. Under the draft law, the General Council 
is not required to include representatives fro m credit institutions, trade and industry, small 
businesses, agriculture or salaried employees and wage-earners. The requirement that members 
                                                             
1  OJ L 189, 3.7.1998, p. 42. 
2  See draft amendments to Articles 22 and 23 of the Law on the OeNB. 
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2 should be persons well-known in a certain bus iness sector, lawyers or economists remains 
unchanged. Furthermore, the draft law reduces from two to one the number of OeNB employee representatives participating in General Council mee tings on personnel, social and welfare matters.  
1.3 The grounds for dismissal of the members of th e General Council remain unchanged. Under Article 
23 of the Law of the OeNB, a member may only be removed from office by the Federal 
Government if he/she no longer fulfils the condition s for holding office or if he/she is guilty of 
serious misconduct. 
1.4 The draft law will increase the terms of office of the members of the Governing Board from five to 
six years
3. The Governing Board is responsible for th e overall operation and conduct of the OeNB’s 
business. 
1.5 Furthermore, the draft law reduces from two to one  the required number of external auditors and 
alternate auditors of the OeNB. The draft law also  introduces the principle of external rotation of 
the external auditors. No auditors or firm of a uditors, which have certified the audit of the OeNB’s 
annual accounts during the previous five financial year s can be re-elected as an auditor or alternate 
auditor. These rotation rules do not apply followin g an audit break of at least two consecutive 
financial years. 
1.6 The draft law enhances transparency as regards the OeNB’s direct and indirect shareholdings in 
undertakings. Under Article 68(4) of the Law on the OeNB, the annual report must include a 
separate disclosure of any such shareholding of th e OeNB, in particular stating the proportion of 
capital and voting rights held as well as the nominal capital. Transparency of the OeNB will also be 
increased by introducing the obligation for the Govern ing Board to draw up a standard cost account 
and an investment plan before the start of each financial year which has to be approved by the 
General Council. After the end of each financial year, the Govern ing Board is also required to 
produce a comparative analysis of the budgeted figu res and the actual costs and investments. The 
comparative analysis has to be communicated to the General Council, together with the auditor’s 
report4.  
1.7 The draft law adjusts the references in the Law of  the OeNB to the Treaty where necessary. These 
adjustments are editorial rather  than substantive changes.  
1.8 The draft amendments to Articles 18 and 19 of  the Law on the Financial Market Supervisory 
Authority increase the annual amount reimbursed by the Financial Market Supervisory Authority 
for on-site inspections and microeconomic analysis of banks carried out by the OeNB as part of its 
banking supervisory tasks from EUR 4 million to EUR 8 million. 
 
                                                             
3  See draft amendments to Article 33 of the Law on the OeNB. 
4  See draft Article 68a of the Law on the OeNB. 
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3 2. Specific Observations 
2.1 The draft law proposes changes to Article 33 of  the Law on the OeNB. However, no changes are 
proposed to Article 33(4), which contains the grounds for dismissal of the members of the 
Governing Board. Over the past few years, the analysis of the different aspects of central bank 
independence has been further refined in the ECB’s opinions5 and Convergence Reports6, inter alia , 
in relation to personal independen ce and the grounds for dismissal of Governors. Accordingly, the 
ECB advises the consulting authority to use this o pportunity to fully align the wording of Article 
33(4) of the Law on OeNB with that of Article 14.2 of the Statute of the European System of 
Central Banks and of the European Central Bank (h ereinafter the ‘Statute of the ESCB’). This 
should be done without setting out  national criteria for dismissal, including references to the 
appointment conditions and c onflict of interest rules. 
2.2 The ECB welcomes the stability in the Govern ing Board of the OeNB that will result from 
increasing its members’ term of office from five to six years. 
2.3 Article 27.1 of the Statute of the ESCB provides that, ‘The accounts of the ECB and national 
central banks shall be audited by independent external auditors recommended by the Governing 
Council and approved by the Council.’. The ECB has established ‘Good Practices for the selection 
and mandate of External Auditors according to Article 27.1 of the ESCB/ECB Statute’, which was 
approved by the ECB’s Governing Council on 23 October 2008. Although the Good Practices are 
not binding, the ECB expects that each Eurosystem central bank, when selecting an external auditor 
pursuant to Article 27.1, and when determining th at auditor’s mandate thereafter, will apply the 
Good Practices and/or explain any divergence. Information on the application and/or any 
divergence from the Good Practices should be provid ed to the ECB when requesting a Governing 
Council recommendation for the appointment of a Euro system central bank’s external auditors to 
the EU Council.  
2.4 Good Practice No 3 recommends that the Eurosy stem central banks should establish a defined 
multi-year mandate for the appointment of external auditors or an audit firm. The draft law does not 
provide for a defined multi-year mandate. Under the draft law, an auditor and an alternate auditor 
are elected each year. The consulting authority ma y use this opportunity to change the one-year 
mandate in the draft law to a multi-year mandate. This will help to enhance overall effectiveness, 
efficiency and independence of the OeNB’s extern al auditors. The draft law would also benefit 
from stating explicitly that the auditors are ‘external’. 
2.5 Further, pursuant to Good Practice No 3, the au ditors or the key audit partner should be rotated 
from the external audit engagement at least every seven years. The draft amendments regarding the 
rotation of the external auditors and alternate auditor every five years comply with the Good 
Practices. However, the ECB draws attention to the currently on-going approval procedure 
contained within Article 27.1 of Statute of the ESCB for the upcoming external auditors of the OeNB. In order not to prejudice this procedure, the ECB suggests that the draft law should include 
                                                           
 
5  See, for example, paragraph 3.2.1 of Opinion CON/2008/21.  
6  See the ECB’s Convergence Reports 2008 and 20 10 under the heading Cent ral Bank Independence. 
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4 appropriate transitional provisions as regards the pr oposed reduction in the number of auditors or 
alternate auditors. 
2.6 With reference to the view previously expressed by the ECB7 in respect of the OeNB bearing any 
costs for on-site inspections and microeconomic anal ysis of banks that exceed the cap mentioned in 
Articles 18 and 19 of the Law on the Financial Ma rket Supervisory Authority, the ECB welcomes 
the increase of the cap for reimbursement of costs from EUR 4 million to EUR 8 million. 
 
This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 20 April 2011.  
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                           
 
7  See paragraph 2.3.2 of Opinion CON/2007/33.