EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 31 July 2008  
at the request of the Belgian Ministry of Finance 
on a draft law establishing, inter alia , an audit committee in listed companies and in financial 
undertakings and on a draft law on reinsurance 
(CON/2008/33) 
 
Introduction and legal basis  
On 18 July 2008 the European Central Bank (ECB) received a request from the Nationale Bank van 
België/Banque Nationale de Belgique  (NBB), acting on behalf of the Belgian Ministry of Finance, for an 
opinion on the following two draft laws (hereinafter toge ther the ‘draft laws’): (i) a draft law establishing, 
inter alia , an audit committee in listed companies and in fina ncial undertakings (hereinafter the ‘draft law 
on the audit committee’); and (ii) a draft law on reinsura nce (hereinafter the ‘draft law on reinsurance’).  
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 
provisions1, as the draft laws relate to the NBB. This op inion only deals with the provisions of the draft 
laws amending the Law of 22 February 1998 establishi ng the Organic Statute of the Nationale Bank van 
België/Banque Nationale de Belgique. In accordance w ith 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 on the audit committee 
1.1 The draft law on the audit committee is intended to  transpose into Belgian law the provisions of 
Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC 
and 83/349/EEC and repealing Council Directive 84/253/EEC
2, that have not yet been transposed: 
Articles 38 and 41 and Article 42(1).  
1.2 In order to transpose the obligation for pub lic-interest entities to have an audit committee3, the draft 
law on the audit committee provides that the NBB’s Board of Censors, in addition to its current 
task, will be the NBB’s audit committee and in th is capacity perform the tasks entrusted to the 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2  OJ L 157, 9.6.2006, p. 87. 
3  Article 41 of Directive 2006/43/EC. 
2 NBB’s audit committee4 listed in the draft law5. The ECB understands that the Board of Censors is 
an NBB body composed of 10 members currently entrusted with supervising the preparation and 
implementation of the budget6 and that the NBB’s general mee ting of shareholders elects its 
members amongst persons with special qua lifications in supervisory procedures7. The Explanatory 
Memorandum to the draft law on the audit committee explains that it is not possible to create the 
audit committee within the NBB’s Board of Direct ors as all its members are executive members. It 
was on the other hand considered logical to set up the audit committee within the NBB’s Board of Censors given that it is already entrusted with supervising the preparation and implementation of 
the NBB’s budget and given the existing requirement  for censors to be appointed among persons 
with special qualifications in supervisory proce dures. Furthermore, the N BB’s General Meeting of 
shareholders elects censors which also  complies with Directive 2006/43/EC.  
1.3 According to Article 24(1) of the draft law on th e audit committee, the NBB’s audit committee is 
entrusted with the following advisory tasks as a minimum, without prejudice to the statutory tasks of the NBB’s bodies: (i) monitoring the fina ncial reporting process; (ii) monitoring the 
effectiveness of the NBB’s internal control and risk management systems and the internal audit
8; 
(iii) monitoring the statutory audit of the annual accounts, including compliance with the statutory 
auditor’s questions and recommendations; and (i v) reviewing and monitoring the statutory 
auditor’s independence, and in particular their pr ovision of additional services to the NBB. In this 
latter respect, the statutory auditor is required to confirm annually to the audit committee their 
independence and to disclose any additional service provided to the NBB9. The statutory auditor 
also discusses with the audit committee any threats to their independence and the safeguards 
applied to mitigate those threats as documented in the audit documents10. Finally, the audit 
committee has an advisory compet ence in the tender procedure for appointing the NBB’s statutory 
auditor and, following such procedure, makes a proposal to the Board of Directors for the 
appointment of the statutory auditor11.  
 2. Specific comments concerning th e draft law on the audit committee 
2.1 The ECB welcomes the draft law on the audit committee as a further contribution to strengthening 
the NBB’s governance framework. The ECB neverthe less considers it advisable for the internal 
allocation of tasks within the Board of Censors to be organised so as to mitigate the risk of conflict 
between its supervision of the pr eparation and implementation of the budget and the tasks entrusted 
                                                 
4  Article 23 of the draft law on the audit committee, amending Article 21 of the Law of 22 February 1998. 
5 Article 24 of the draft law on the audit committee, in serting Article 21 bis in the Law of 22 February 1998. 
6  Article 21 of the Law of 22 February 1998. 
7  Article 23(4) of the Law of 22 February 1998. 
8  According to Article 24(3) of the draft law on the audit co mmittee, without prejudice to their obligation to report to the 
NBB’s bodies, the NBB’s statutory auditor also reports to th e audit committee on key matters arising from the statutory 
audit, and in particular on materi al weaknesses in internal controls in the financial reporting process. 
9  Article 24(4) of the draft law on the audit committee, in serting Article 21 bis (4) in the Law of 22 February 1998. 
10  Article 24(4) of the draft law on the audit committee, in serting Article 21 bis (4) in the Law of 22 February 1998. 
11  Article 24(2) of the draft law on the audit committee, in serting Article 21 bis (2) in the Law of 22 February 1998. 
3 to it by the draft law on the audit committee in its  capacity as audit committee. Relevant provisions 
for this purpose could for instance be set out in  the NBB’s Rules of Procedure referred to in 
Article 24(5) of the draft law on the audit committee. 
2.2 According to the Explanatory Memorandum to the draft law on the audit committee, the Council of 
the European Union, on a recommendation by the ECB’s Governing Council, must approve the appointment of the NBB’s statutory auditor. The E CB would welcome a reference in the text of the 
draft law to these ECB and Council competences under Article 27.1 of the Statute of the European 
System of Central Banks and of the European Cent ral Bank, similarly to the reference to the Works 
Council’s competence in Article 24(2). In particul ar, the ECB considers that the draft law should 
clarify that the audit committee’s tasks and activiti es may interfere neither with the performance of 
the NBB’s ESCB-related tasks nor with thei r review by the NBB’s statutory auditor
12. 
2.3 The ECB understands that when reviewing and m onitoring the independence of the statutory 
auditor under Article 21 bis (1)(d) of the Law of 22 February 1998 and advising on the tender procedure for appointing the statutory auditor, th e NBB’s audit committee will take account of the 
Eurosystem’s good practice in selecti ng and mandating external auditors.  
 3. Purpose of the draft law on reinsurance and specific comments 
3.1 The draft law on reinsurance is intended to trans pose into Belgian law Directive 2005/68/EC of the 
European Parliament and of the Council of 16 November 2005 on reinsurance and amending 
Council Directives 73/239/EEC, 92/49/EEC as well as Directives 98/78/EC and 2002/83/EC
13. In 
this context, the draft law on reinsurance adds  the authorities responsible for supervising 
reinsurance undertakings to the list of supervis ory authorities to which the NBB is allowed to 
communicate information covered by professional se crecy under the first paragraph of Article 35 
of the Law of 22 February 1998 if such inform ation is necessary for their supervisory function14. 
3.2 The ECB has no specific comments on this provision of the draft law on reinsurance. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 31 July 2008. 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
12  See paragraph 3.2 of ECB Opinion CON/2006/44 of 25 August 2006 at the request of the Ba nca d’Italia on the amended 
Statute of the Banca d’Italia. 
13  OJ L 323, 9.12.2005, p. 1. 
14 Article 143 of the draft law on reinsurance, am ending Article 35 of the Law of 22 February 1998.