OPINION OF THE EUROPEAN MONETARY INSTITUTE
on a consultation from the Austrian Federal Ministry 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”)
concerning a draft Federal Act on the participation of Austria in the New Arrangement to Borrow with
the International Monetary Fund
CON/97/16
1. On 18 July 1997 the EMI received from the Oesterreichische Nationalbank on behalf of the
Austrian Federal Ministry of Finance the request for an opinion on a draft Federal Act on the
participation of Austria in the New Arrangement to Borrow (NAB) with the International
Monetary Fund (IMF).
 
2. The subject matter of the draft Act is intended to authorise the Oesterreichische Nationalbank to
grant, in the name of the Republic of Austria, a loan of a maximum of SDR 412 million to the
IMF. This loan will be part of a credit facility established in January 1997, the New Arrangement
to Borrow, which will amount in total to SDR  34 billion. The decision to grant the loan shall be
made by the Federal Minister of Finance in agreement with the Oesterreichische Nationalbank.
 
3. The EMI’s competence to deliver an opinion is based on Article 1.1, second indent, of the
Decision. Clearly, the draft act concerns arrangements in relation to the IMF to which the
Member States are parties rather than national central banks. However, the fact that the draft
act explicitly involves the Oesterreichische Nationalbank in the individual implementation of this
arrangement by granting - in the name of the republic of Austria - a loan to the IMF influences
the status and powers of the Oesterreichische Nationalbank foreseen by the national law.
 
4. The EMI welcomes the general approach of the Act. The participation of EU countries in the
NAB can be an important contribution to safeguard the international financial system against
systemic crises. The NAB will enable the IMF to ward off a threat to the international monetary
system even in the presence of large and volatile capital movements. This objective is of
considerable importance to the euro area, which will host one of the world’s largest financial
markets.
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5. The EMI confirms that the arrangement does not interfere with Article 104 of the Treaty as
according to Article 7 of Council Regulation (EC) No 3603/93 of 13 December 1993 the
financing by the national central banks of obligations falling upon the public sector vis-à-vis the
International Monetary Fund shall not be regarded as a credit facility within the meaning of
Article 104.
 
6. The EMI would like to note that the possible implications of the activation of the NAB on the
monetary policy of the ESCB, in particular liquidity effects, would need some special
consideration. Therefore, it would be recommendable to ensure that the ECB is informed  prior to
granting a loan to the IMF in order to enable the former to sterilise any liquidity effects resulting
from it, as appropriate.
 
7. This opinion does not prejudice the right of the ECB to express its views on national central
banks’ involvement in the implementation of the NAB.
 
The EMI has no objection to this opinion being made public.
27 August 1997