EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 27 October 2009  
on Národná banka Slovenska’s independence 
(CON/2009/85) 
 
Introduction and legal basis  
On 20 October 2009 the European Central Bank (ECB)  received a request from the National Council of 
the Slovak Republic for an opinion on draft amendments to Section VI of the draft law on payment services and on amendments to certain laws (hereinafter the ‘draft law’). Section VI of the draft law contains draft amendments to the La w on Národná banka Slovenska (NBS). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community 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 
provisions
1, as the draft law relates to NBS. 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 The draft law introduces a provision on a possible transfer of NBS’ profit to the State budget or 
State financial assets. According to the draft provision, the Board may decide on a transfer of the profit balance or any part thereof to the State budget or State financial assets. 
1.2 The draft law also provides for changes in the composition of the Board and the reappointment of 
its members. The number of Board members will be  reduced from 11 to five, with this reduction 
concerning only Board members appointed by the Government. The number of Board members 
will be reduced gradually, as all current Board memb ers will remain until the end of their term of 
office. The draft law will allow members of the Board to be reappointed without any limitation except the Governor and the Vice-Governor; under th e current law, reappointment was limited to 
two consecutive terms of office. 
1.3 The draft law also introduces a provision aiming to provide for continuity in the Governor’s office, 
with the Governor’s function and the term of office not ceasing before the effective date of the 
appointment of a new NBS Governor. 
 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2 2. General observations 
2.1 The statutes of national central banks (NCBs) and any amendments thereto must safeguard the 
independence of NCBs, thus ensuring the proper performance of their tasks under the Treaty and 
the Statute of the European System of Central Ba nks (hereinafter the ‘Statute of the ESCB’). The 
draft law contains amendments to the Law on Národná banka Slovenska (NBS) that concern 
personal and financia l independence of the central bank.  
2.2 With regard to personal independence, the amendm ents should safeguard the security of tenure and 
the minimum term of office of the Governor a nd of the other members of decision-making bodies 
involved in the performance of ESCB-related task s. Article 14.2 of the Statute of the ESCB 
provides that the NCB statutes must provide for a minimum term of office of five years for the 
Governor; it also protects against the arbitrary dism issal of Governors, by providing that Governors 
may only be relieved from office if they no longer fulfil the conditions required for the 
performance of their duties or if they have been guilty of serious misconduct. 
2.3 One of the features of financial independence that  is most vulnerable to outside influence is the 
distribution of profits and the creation of financial provisions. With regard to profit allocation rules, 
an NCB’s statute may prescribe how profits ar e to be allocated. Moreover, even though 
amendments to such rules are possible, it is importa nt to shield the rules re lated to the distribution 
of profits from third-party interests and to ensure  a legal framework that provides a stable and long-
term basis for the central bank’s functioning2. Furthermore, any decision by NCB decision-making 
bodies on allocation of profits should be taken on professional grounds and should not be subject to 
the discretion of third parties unless there is an e xpress safeguard clause stating that this is without 
prejudice to the financial means necessary for car rying out the ESCB or Eurosystem-related tasks3. 
2.4 With regard to financial provisions and buffers , as stressed by the ECB in its convergence reports, 
an NCB must be free to independently create financ ial provisions to safeguard the real value of its 
capital and assets. 
 3. Personal independence The new wording of Article 7(8)(a) and Article 7(8)(b ) provides that the office of the Governor may cease 
only when a new Governor has been appointed. The E CB understands that this new provision is intended 
to fill the gap between expiry of the Governor’s fi ve year term office or resignation from office, and 
appointment of a new governor subject to Article 7(4)  of the Law on NBS. The wording of this provision 
might lead to a different interpretation, whereb y the office of the Governor will cease when a new 
governor is appointed, whenever this will happen, i.e. ev en before expiry of the five year term of office, 
or before resignation. In order to avoid any possibl e misinterpretation that could lead to breach of 
Article 14.2 of the Statute of ESCB, rewording of this provision should be considered. 
 
                                                 
2  See ECB Opinion CON/2007/14. All ECB opinions are published on the ECB’s website at www.ecb.europa.eu. 
3  See the ECB’s Convergence Report May 2008, p. 21. 
3 4. Financial independence  
4.1 Each Member State is obliged to safeguard thei r NCB’s financial independence, thus ensuring the 
proper performance of its tasks under the Treaty and the Statute of the ESCB4. In particular, the 
compatibility of the Law on NBS with the central  bank independence require ments of Article 108 
of the Treaty and the Statute of the ESCB is of utmost importance, as NBS’ primary objective of 
price stability is best served if it is a fully independent institution with a precisely defined 
mandate5. 
4.2 The ECB welcomes the new wording of Article 39(4) of the Law on NBS which stipulates that the 
profit balance of the NBS or any part thereof may be  transferred to the State budget or to the State 
financial assets subject to a decision only by NB S’ Board and in accordance with the Law on the 
budgetary rules for public administration. 
4.3 NCBs must have sufficient financial means to carry  out their other functions at all times, i.e. they 
must be able to perform their national tasks, to meet their international obligations and to cover 
their administrative and operational expenses6. The ECB understands that the new third sentence of 
Article 39(4) of the Law on NBS must be read in  conjunction with the second sentence thereof, i.e. 
any NBS profit is first allocated to the reserve  fund and other funds created from profit and is 
intended to cover an accumulated loss from previous years. In this context, it is understood that 
only once the accumulated losses from previous years have been covered may any profit balance be 
transferred to the State budget or to the State fi nancial assets, following a decision by the Board. 
This mechanism is crucial to en sure NBS’ financial independence without weakening its financial 
means for implementing its monetary policy7. The draft law should be reworded regarding 
paragraph 39(4) of the Law on NBS in this respect.  
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 27 October 2009. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
 
                                                 
4  Opinion CON/2009/53, paragraph 2.1.  
5  Opinion CON/2009/26, paragraph 2.1. 
6  Opinion CON/2009/26, paragraph 2.3; an d Opinion CON/2009/53, paragraph 2.2. 
7  Opinion CON/2009/53, paragraph 3.2.