EN ECB-PUBLIC 
 
 
 OPINION OF THE EUROPEAN CENTRAL BANK 
of 30 June 2011  
on the harmonisation of legislation related to TARGET2-Securities and Banka Slovenije’s 
sanctioning powers relating to investment services 
(CON/2011/55) 
 
Introduction and legal basis  
On 27 May 2011, the European Central Bank (ECB) r eceived a request from the Slovenian Ministry of 
Finance for an opinion on the draft law amending the La w on the market in financial instruments and the 
draft law amending the Law on book-entry securities (herei nafter jointly referred to as the ‘draft laws’). 
On 21 June 2011, the Ministry notified the ECB that a new Article 7 had been added to the draft law 
amending the Law on the market in financial instruments. 
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 the third and fifth indents 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 laws relate to Banka Slovenije and payment and 
settlement systems. 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 laws 
1.1 The main objective of the draft laws is to harmonise legislation governing the operation of 
integrated securities settlement systems in order to facilitate the integration of the Slovenian central 
securities depository, Centralna klirinško depotna družba d.d., Ljubljana , with TARGET2-
Securities (T2S). To this end, the draf t laws introduce the following changes: 
(a) The draft law amending the Law on the market in financial instruments removes all 
references concerning the application of admini strative procedures to the central securities 
depository (CSD). As stated in the explanatory memorandum to the draft law, the amendments are: (i) made in order to clarify that the CSD does not exercise public authority; 
and (ii) necessary to allow the CSD to transfer  its task of effecting entries of book-entry 
securities in the central register to T2S; 
                                                     
 
1  OJ L 189, 3.7.1998, p. 42.  
ECB-PUBLIC 
2 (b) According to Article 34 of the Law on book-entry securities, the CSD is strictly liable to 
issuers and holders of rights entered into the cen tral register for any damage caused by the 
CSD’s failure to execute an order, execute it co rrectly, or meet any of its other obligations 
under the Law. However, the CSD will not be stri ctly liable where it can prove that the cause 
was (i) an event beyond the scope of its business and its consequences could not be 
anticipated, avoided or averted; or (ii) an action on the part of an issuer, holder, CSD member or third party that could not be an ticipated and its consequences could not be 
avoided or averted. Pursuant to the draft law,  strict liability will be replaced by fault-based 
liability of the CSD vis-à-vis its service u sers in accordance with the law governing 
obligations
2; 
(c) The draft law amending the Law on book-entry securities also introduces a matching phase 
in the securities transfer between different account s whereby, prior to carrying out a transfer, 
the CSD must establish that transfer orders from the transferor and the recipient match3.  
1.2 The draft law amending the Law on the market in financial instruments (hereinafter the ‘Law’) is 
also intended to transpose Directive 2010/78/EU4 into Slovenian law. In accordance with Article 
1(2) of Decision 98/415/EC, the ECB does not provide its opinion on draft legislative provisions the exclusive purpose of which is the transpositi on of Union directives in the law of Member 
States. 
1.3 The draft law amending the Law has been amende d to add a new Article 7, which amends Article 
33 of the Law. If this amendmen t were made, Banka Slovenije w ould no longer have powers to 
sanction a breach of the Law relating to the provisi on of investment services by banks in Slovenia. 
Instead, those powers would be transferred to the Slovenian Securities Market Agency (hereinafter 
the ‘Agency’), which is competent, in cooperati on with Banka Slovenije to supervise all of the 
following in respect of investment services: (a ) Slovenian banks; (b) Member State banks and 
special financial institutions as define d by the Law; (c) third country banks. 
 
2. General observations  
2.1 The ECB welcomes the amendments proposed by th e draft laws mentioned in paragraph 1.1, which 
should facilitate the smooth integration of the Slovenian CSD with T2S.  
2.2 As regards the proposed transfer of Banka Slove nije’s sanctioning powers to the Agency, pursuant 
to Article 7 of the draft law amending the Law, the ECB notes that breaches of the Law relating to 
the provision of investment services might affect  the prudent and safe operations of supervised 
entities in general which are subject to prudential supervision by Banka Slovenije. Also, taking into 
                                                     
 
2  Article 239(2) of the Code of obligations: ‘(2) If a debtor fails  to perform its obligation or is late in performing it, the 
creditor shall also be entitled to demand reimbursement of damage incurred thereby.’ 
3  Article 22(3) of the Law as amende d by Article 8 of the draft law.  
4  Directive 2010/78/EU of the European Parliament and of  the Council of 24 November 2010 amending Directives 
98/26/EC, 2002/87/EC, 2003/6/EC, 2003/41/EC, 2003/71/ EC, 2004/39/EC, 2004/109/EC, 2005/60/EC, 2006/48/EC, 
2006/49/EC and 2009/65/EC in respect of the powers of th e European Supervisory Authority (European Banking 
Authority), the European Supervisory Authority (European Insurance and Occ upational Pensions Authority) and the 
European Supervisory Authority (Eur opean Securities and Markets Authority) (OJ L 331, 15.12.2010, p. 120).  
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3 account that, according to the Law, supervision in the area concerned is carried out by the Agency 
in cooperation with Banka Sloven ije, this warrants Banka Slovenije  remaining involved in the 
sanctioning process. Against this background, the ECB expects that any decision on the transfer of 
sanctioning powers should be taken in consultation with Banka Slovenije.  
 
This opinion will be published on the ECB’s website. 
  Done at Frankfurt am Main, 30 June 2011. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET