EN ECB -PUBLIC  
 
 OPINION OF THE EUROPEAN CENTRAL BANK  
of 11 May  2020  
on amendments to  Latvian national security,  emergency situation and mobilisation laws  
(CON/20 20/15) 
 
Introduction and legal basis  
On 9 April 2020 the European Central Bank (ECB) received a request from the Ministry of Finance of the 
Republic of Latvia for an opinion on three draft law s: (a) a draft law amending the Law on national 
security1; (b) a draft law amend ing the Law on emergency situations and states of exception2; and ( c) a 
draft law amending the Law on m obilisation3. 
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 on the third and fifth indent s of Article 2(1) of Council Decision 
98/415/EC4, as the draft law s relate to the Latvijas Banka,  and payment and settlement systems  as well 
as to the specific tasks conferred upon the ECB concerning the prudential supervision of credit institutions 
pursuant to Article 127(6) of the Treaty. 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 s 
1.1 Purpose of the draft law amending the Law on national security  
1.1.1  The general aim of the draft law amending the Law on national security is to set out  the vital or 
critical services which are important  for the functioning of the S tate and the public and to ensure 
their continuity in case of a threat to national security.  
1.1.2  This draft law amends the definition of ‘ critical infrastructure’  by providing that a critical 
infrastructure includes  not only objects and systems located in Latvia,  as already provided by the 
current wording of the Law on national security5, but also services provided in Latvia which are 
important  for ensuring the carrying out  of important public functions, human health protection, 
security, economic or social welfar e, the destruction of or interference with which would 
significantly affect the carrying out of such State and public core functions.  
1.1.3  The draft law  adds a provision that the owner or legal possessor  of a critical infrastructure, 
including a European critical infrastructure, must  take the minimum measures necessary to ensure 
                                                 
1  Grozījumi Nacionālās drošības likumā .  
2  Grozījumi likumā “Par ārkārtējo situāciju un izņēmuma stāvokli” .  
3  Grozījumi Mobilizācijas likumā .  
4  Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank by national 
authorities regarding draft legislative provis ions (OJ L 189, 3.7.1998, p. 42).  
5  See A rticle 22.1(1) of the Law on national security.  
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2 security and operational continuity. The existing wording of  the Law on national security only 
provides that the owner or legal possessor of  a critical infrastructure, inc luding  a European critical 
infrastructure, must  ensure planning and implementation of security measures and operational 
continuity6. 
1.1.4  The draft law includes a dedicated new section, introducing a concept of ‘ critical financial sector 
services ’, defined to include  cash and non- cash settlement services provided in the Republic of 
Latvia by a credit institution licensed or registered in a E uropean Union Member State. Thus, based 
on the amended definition of ‘ critical infrastructure’ , which under the draft law includes not only 
objects and systems located in Latvia, but also services provided in Latvia,  critical financial sector 
services would be considered as part of  a critical infrastructure. In order t o ensure the availability of 
critical financial sector ser vices in case of a threat to national security, a  credit institution must  
develop an operational continuity plan stipulating the obligations of outsourced service providers  
used by the credi t institution to ensure cash and non- cash settlements  and must  submit this  plan to 
the Finanšu un kapitāla tirgus komisija (Financial and Capital Market Commission (FCMC) ). 
1.1.5  Under the draft law, t he FCMC  establish es (a) the criteria for identifying credit institutions ensuring 
the availability of critical financial se ctor services in case of a threat to national security; ( b) the 
minimum scope of critical financial sector services in case of a threat to national security;  and 
(c) the requirements for developing credit institutions’  operational continuity plans.  
1.1.6  The FCMC , in cooperation with Latvijas Banka,  will (a) monitor and control the development and 
implementation of credit institutions’  operational continuity plans in case of a threat to national 
security;  and (b) evaluate the test results of credit institutions’  operational continuity plans.   
1.2 Purpose of the draft law amending the Law on e mergency situations and s tates of exception  
1.2.1  The general aim of the draft law amending the Law on emergency situations and s tates of 
exception is to ensure the continuity of  the functioning of the State during emergency situations and 
states  of exception, providing for additional restrictions on rights to be imposed during a state of 
exception, expanding the rights of the Cabinet of Ministers and elaborating on the procedure for 
changing the appropriation of the State budget for the current year.  
1.2.2  The draft l aw contains provisions related to the withdrawal of cash for overcoming a threat to 
national security.  In particular, it  provides that  State institutions responsible for overcoming a threat 
to national security may receive cash from the Latvian State Treasury account in Latvijas Banka 
and Latvijas Banka will disburse cash to such institutions within the limits of the balance of the 
Latvian State Treasury account with Latvi jas Banka. The abovementioned institutions shall repay 
the unused cash to Latvijas Banka, and Latvijas Banka shall accept it and credit it to the Latvian 
State Treasury account with Latvijas Banka.  
1.3 Purpose of the draft law amending the Law on mobilisation  
1.3.1  The general aim of the draft law amending the Law on m obilisation is to provide for exceptions for 
the conscription of certain officials and providers of critical or vital services into active military 
service.  
                                                 
6  See A rticle 22.1(4) of the Law on national security.  
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3 1.3.2  The draft law  specifically provides that the Governor, Deputy Governor and Members of the 
Council of Latvijas Banka as well as the Chairman and Members of the Council of the FCMC are 
exempt from conscription into active military service.  
1.3.3  The draft law  also provides that depending on the type, intensity and nature of threats to the  State, 
the Cabinet of Ministers may grant mobilisation  exceptions to other officials, employees or persons 
having an employment relationship with a person ensuring the continuity of critical i nfrastructures  
or critical financial sector services of the State and local government institutions.  
 
2. Observations   
2.1 The ECB notes that under Article 127(6) of the Treaty and Council Regulation (EU) No 1024/20137 
specific tasks concerning the prudential supervision of credit institutions have been conferred upon 
the ECB . In particular, the ECB carries out the task of  authoris ing and withdraw ing the 
authorisations of all credit institutions. For significant credit institutions the ECB also has the task, 
among others, to ensure compliance with relevant Union law impos ing prudential requirements on 
credit institutions, including the requirement to have in place robust governance arrangements, 
such as sound risk management processes and internal control mechanisms8. To this end, the 
ECB is given all supervisory powers to intervene in the activity of credit institutions that are 
necessary for the exercise of its functions. As previously noted by the ECB, pursuant to the 
principle of sincere cooperation under Art icle 4(3) of the Treaty on European Union, the Member 
States are obliged to assist the ECB in carrying out tasks which flow from the Treaties. This implies 
that Member States should refrain from taking any measures which could jeopardise the ECB’s 
objectiv es. As the tasks related to critical financial sector services which the draft law amending the 
Law on national security assigns to the FCMC have been partially conferred upon the ECB, the 
national legislative bodies might consider clarifying that the relevant provisions of that draft law are 
without prejudice to the tasks and powers conferred on the ECB for prudential supervisory 
purposes under the Treaty and Regulation (EU) No 1024/20139.  
2.2 The ECB understands that the term ‘critical infrastructure’ un der the draft law amending the Law on 
national security does not include financial market infrastructures , including payment, settlement 
and clearing systems and central securities depositories,  operated and/or overseen by Latvijas 
Banka, whether in the fr amework of the Eurosystem and the E uropean System of C entral Banks  
(ESCB) , or otherwise. The ECB understands that t he term ‘critical infrastructure’ under that  draft 
law only includes physical  objects, systems and parts thereof  located in Latvia as well as  services 
provided in Latvia which are of significance for ensuring the implementation of important public 
functions, as well as human health protection, security, economic or social welfare and destruction 
of or interferences in the operation of which wou ld significantly affect the implementation of State 
functions.  IT systems are governed by the Law on the s ecurity of Information Technologies10, 
                                                 
7  Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank 
concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p.  63).  
8  See Article 4(1)(e) and Article 6(4) of Regulation (EU) No 1024/2013.  
9  See paragraphs 2.1 and 2.6 of Opinion CON/2020/2. All ECB opinions are published on the ECB’s website at 
www.ecb.europa.eu.  
10  Informācijas tehnoloģiju drošības likums . 
ECB -PUBLIC  
4 which implements Directive  (EU) 2016/1148 of the European Parliament and of the Council11 into 
Latvian law . The E CB therefore understands that the only financial market activity covered by  the 
definition of ‘critical infrastructure’ under the draft law amending the Law on national security 
comprises ‘critical financial sector services’ , consisting of  cash and non- cash settlement services 
provided in Latvia by  credit institutions  licensed (registered) in a Union  Member State. However, for 
the avoidance of doubt, t he national legislative bodies might wish to consider explicitly clarifying in 
the draft law that the term ‘critical infrastructure’ excludes all financial market infrastructures 
operated and/or overseen by the Latvijas Banka, whether in the framework of the Eurosystem and 
the ESCB, or otherwise.  
2.3 The ECB understands that the draft law amending the Law on m obilisation allows the Cabinet of 
Ministers to grant mobilisation exceptions to other officials, employees and persons having an 
employment relationship with entities which ensure the continuity of critical infrastructures  or critical 
financia l sector services of a State and local government institutions , depending on the type, 
intensity and nature of endangerment to the State. The national legislative bodies might consider 
explicitly clarifying in the draft law that officials, employees and persons having an employment 
relationship with Latvijas B anka who perform tasks required for continuity of critical financial sector 
services provided by credit institutions may also be granted mobilisation exceptions by the Cabinet 
of Ministers.  
 
This opinion will be published on the ECB’s website.  
 
 
Done at Frankfurt am Main,  11 May 2020. 
 
[signed]  
 
The President of the ECB  
Christine LAGARDE  
                                                 
11  Directive (EU)  2016/1148 of the European Parliament and of the Council of  6 July 2016 concerning measures for a 
high common level of security of network and information systems across the Union (OJ L 194, 19.7.2016, p. 1).