GS/LD/97/300
OPINION OF THE EUROPEAN MONETARY INSTITUTE
on a consultation from the German Minister of Finance  under Article 109f (6) of the Treaty establishing
the European Community (the “Treaty”) and Article 5.3 of the Statute of the EMI as elaborated in the
Council Decision of 22 November 1993 (93/717/EC) (the “Decision”)
on the Draft 6th Act amending the Bundesbank Act
CON/97/10
1. The above consultation was initiated by the German Minister of Finance, who on 12 May 1997
submitted the relevant draft provisions to the European Monetary Institute. Owing to the urgency
of the matter given to it by the German authorities an opinion of the EMI was requested to be
delivered by the end of the month.
 
2. The EMI’s competence to deliver an opinion is based on Article 1.1, second indent, of the
Decision, as the draft provisions relate to the status and powers of the Bundesbank.
 
3. The EMI welcomes the timely and efficient legislative action to clarify the legal situation of the
German central bank in the light of requirements of the EC Treaty and Article 108 thereof. This
applies in particular with regard to the reorganisation of the responsibility for monetary policy
resulting from the entry into the third stage of monetary union.
 
4. With regard to the specific provision the EMI appreciates that Section 3 of the draft Act on the
primary objective and task of the Bundesbank incorporates the concept of price stability of
Article 105(1) of the EC Treaty and confirms the principle of the national central banks being an
integral part of the European System of Central Banks as laid down in Article 14.3 of the Statute
of the ESCB. It takes note that the revised wording of Section 3 reflects the legal
acknowledgement of obligation of the Bundesbank to implement, within the framework of the
ESCB, the monetary policy adopted by the Governing Council of the ECB. The EMI also agrees
that the pledge of secrecy provided for in Section 32 of the Bundesbank Act does not obstruct
communications with the ECB on monetary developments and measures.
 
5. The draft amendment does not touch upon Section 4 of the Bundesbank Act which entitles the
Bundesbank to participate in the Bank for International Settlements and, subject to the approval
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of the Federal Cabinet, inter alia in other institutions serving the purposes of supranational
monetary policy. It is understood that Section 4 is to be read in the light of the prevailing
Article  6.2 of the Statute of the ESCB which states that the national central banks may
participate in international institutions, subject, however, to the approval of the ECB. It would be
welcome, for reasons of legal certainty and clarity, that this legal situation is adequately mirrored.
 
6. The amendment of Section 6(1) reflects the transfer of the responsibility of the Central Bank
Council for determining monetary policy to the Governing Council of the ECB and confirms the
conformity of actions of the Bundesbank with guidelines and instructions of the ECB in
accordance with Article 14.3 of the Statute of the ESCB. The EMI does not see any
interference with that principle by the Central Bank Council determining the Bundesbank’s
business policy or by the mention of discussions of implications of monetary policy by this body.
It acknowledges that in these respects no organisational change of the Bundesbank is intended.
 
7. The EMI acknowledges that the amendments to Section 7 and Section 8 fully reflect the
requirements concerning the minimum term of office of the Governor of a national central bank
according to Article 14.2 of the Statute of the ESCB. It welcomes that the minimum term of
office also of the other members of decision-making bodies of the Bundesbank has been
increased to five years.
 
8. Section 12 of the Bundesbank Act has remained unchanged and provides for the support of the
Bundesbank, without prejudice to the performance of its functions, to the general economic
policy of the Federal Cabinet. The EMI notes that the functions of the Bundesbank are defined
according to the revised Section 3. Therefore, as the Bundesbank will be an integral part of the
ESCB which according to Articles 105(1) of the Treaty and 2 of the Statute of the ESCB entails
that it shall support the general economic policies in the Community, any support by the
Bundesbank to national economic policy has to be confined to those areas that do not conflict
with Article 2 of the Statute of the ESCB. However, it would be welcome that Section 12
explicitly addresses this issue in order to avoid any misinterpretation of this provision.
 
9. The EMI welcomes the repealing of Section 13(2), sentence 3 in the Bundesbank Act which
provision was not in line with the institutional independence of the national central bank in
accordance with Article 107 of the EC Treaty.
 
10. With regard to the amendment of Section 14 the EMI agrees with the proposed wording to be
added. It is understood that this section is meant to protect the sole right of the Bundesbank to
issue banknotes within the German monetary area during the transitional period without prejudice
to the competencies of the ECB in accordance with Article 105a(1) of the EC Treaty.
 
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11. The decision to repeal the provisions of Sections 15 and 16 of the Bundesbank Act on the
discount, lending, open market and minimum reserve policies reflects the availability, for the
ESCB, of monetary policy instruments under the Treaty and the Statute of the ESCB to fulfil its
tasks.
 
12. Whereas the EMI has no objections with regard to Article 108 of the EC Treaty to maintaining
at this stage the provisions in Sections 19 to 21 of the Bundesbank Act, once the ECB has
adopted the operational framework for its monetary policy at a later stage, it may result in
inconsistencies with that operational framework and legal clarity would require at that stage
adaptation.
 
13. Section 27 of the Bundesbank Act has remained unchanged. The EMI would like to emphasise
that this provision will have to be applied in the context of Article 32 on the allocation of
monetary income of national central banks.
 
14. The EMI has no objections against the repealing of Section 28 on the Bundesbank’s Weekly
Returns.
 
15. According to Section 32 of the Bundesbank Act all persons in the service of the Deutsche
Bundesbank are pledged to secrecy about affairs and facilities of the Bank. Sentence 3 of this
section lays down the procedure under which the permission to make statements about these
matters is granted “where the interests of the Bank are involved”. It is recommended that it is
confirmed that, where the objectives and tasks of the ESCB are concerned, the conditions of
Article 38 of the Statute of the ESCB - on the professional secrecy of members of the governing
bodies and the staff of the national central banks - take precedence over such procedure of
permission.
 
16. This opinion is confined to the text submitted by the consulting authority.
 
The EMI has no objection to this opinion being made public.
30 May 1997