EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 21 September 2007 
at the request of Banca Na ţională a României 
on a draft regulation on oversight of payment syst ems, securities settlement systems and payment 
instruments 
(CON/2007/27) 
 
Introduction and legal basis  
On 30 July 2007 the European Central Bank (ECB) received a request from Banca Na ţională a României 
(BNR) for an opinion on a draft regulation on oversight of payment systems, securities settlement systems and payment instruments (hereinafter the ‘draft regulation’). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the third and fifth indent s of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions
1, as the draft regulation relates to BNR 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 regulation 
1.1 The draft regulation sets up the regulatory framework for the oversight by BNR of payment 
systems, securities settlement systems and payment instruments. In particular, it specifies: (i) the 
categories of systems and entities subject to over sight; (ii) the requirements for operators of 
payment systems, securities settlement systems and infrastructure services and for persons who 
issue/put into circulation and/or manage payment in struments; and (iii) the oversight activities to be 
carried out by BNR to ensure the smooth functi oning of these systems and, ultimately, to ensure 
financial stability, including BNR’s right to carry  out on-site inspections to obtain and verify 
information.  
1.2 The draft regulation is issued on the basis of Article 405 of Government Urgency Ordinance 
No 99/ 2006 on credit inst itutions and capital adequacy
2 (hereinafter the ‘GUO 99/2006’), which 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2 Published in the Monitorul Oficial al României , Part One, No 1027, 27.12.2006, as amended and approved by Law 
No 227/2007, published in the Monitorul Oficial al României , Part One, No 480, 18.7.2007. 
2 establishes that BNR ‘shall issue regulations’ concerning payment and securities settlement 
systems, and, in particular, ‘the criteria and the rules for the supervision of the systems, including 
the participants in these systems and their operators’.  
 2. General observations  2.1 The ECB welcomes the draft regulation which estab lishes the rules applicable to the oversight of 
payment systems, securities settlement systems a nd payment instruments, as the oversight function 
is inherent in the central banks’ task of promo ting a sound market infrastructure to safeguard the 
effectiveness of monetary policy and the overall stability of the financial system
3.  
2.2 As mentioned in previous ECB opinions4, payment systems and securities settlement systems are 
interlinked, particularly in view of the use of  the ‘delivery versus payment’ mechanism, under 
which settlements of securities and transfers of funds take place simultaneously. There is therefore a strong argument in favour of the model used in some Member States of integrating the oversight of payment systems and securities settlement systems, and for the national central banks (NCBs) to perform the oversight function. 
2.3 The oversight of payment systems has always been recognised as one of the NCBs’ main tasks and 
the framework for this function h as been effective and successful. Article 2(2)(b) and Article 22(1) 
of Law No 312/2004 on the Statute of Banca Na ţională a României
5, which entitle BNR to oversee 
payment systems, including payment instruments, Article 404 of GUO 99/2006, which entitles BNR to regulate, authorise and supervise the payment systems and securities settlement systems 
from Romania, including their operators, Article 405 of GUO 99/2006 and Article 13(4)
6 of Law 
No 253/2004 on settlement finality in pa yment and securities settlement systems7, reflect, at the 
national level, the general legal framework for th e oversight of payment systems created at the 
Community level through Article 105(2)8 of the Treaty and Article 3.1 and Article 22 of the Statute 
of the European System of Central Banks and of  the European Central Bank  (hereinafter the 
                                                 
3  See, e.g. ECB Opinions CON/2005/24 of 15 July 2005 at the requ est of the Ministry of Finance of the Czech Republic on 
a draft law on the integration of fina ncial market supervisors; CON/2003/14 of  7 August 2003 at the request of Banca 
d’Italia on a draft regulation on payment systems, payment infrastructures and payment instruments; and CON/99/19 of 
20 January 2000 at the request of the Luxembourg Ministry for the Treasury and the Budget on a draft legislative 
proposal implementing Dire ctive 98/26/EC on settlement finality in payment and securities settlement  systems in the law 
of 5 April 1993, as amended, relating to the financial se ctor and completing the law of 23 December 1998 creating a 
commission in charge of the prudential s upervision of the financial sector. See al so the Bank for International Settlements 
(BIS) Committee on Payment and Settlement Systems, ‘Centr al bank oversight of payment and settlement systems’, 
May 2005, available on the BIS website at www.bis.org.  
4  See ECB Opinion CON/2006/20 of 25 April 2006 on the Dutch draft law concerning financ ial sector supervision. 
5  Published in the Monitorul Oficial al României,  Part One, No 582, 30.6.2004. 
6  ‘Banca Na ţională a României will permanently oversee the payment systems and the securities settlement systems which 
settle through systemically important payment systems or through payment systems of prominent importance.’ 
7  Published in the Monitorul Oficial al României , Part One, No 566, 28.6.2004. 
8  Article 105(2) of the Treaty states that ‘[t]he basic tasks to be carried out through the ESCB shall be … to promote the 
smooth operation of payment systems.’ 
3 ‘ESCB Statute’)9. 
2.4 Within the Eurosystem, oversight activities ar e performed by NCBs in line with the common 
oversight policy, as defined by the ECB’s Govern ing Council. This will also apply to BNR once 
Romania adopts the euro. Furthermore, on Romania’ s adoption of the euro the securities settlement 
system selected to provide securities settlement of  central bank credit operations will be assessed 
against the Eurosystem standards for the use of  European Union securiti es settlement systems in 
ESCB credit operations10. For that reason, this opinion is without prejudice to any future ECB 
assessment of the securities settlement system select ed to provide securities settlement of central 
bank credit operations against the abovementioned standards11. 
2.5 The explanatory memorandum states that BNR will issue norms which will specify the standards 
and the methodology for carrying out an assessmen t for each type of system. Once such draft 
provisions are prepared, BNR should consider wh ether these are also subject to the duty of 
consultation which stems from Article 105(4) of  the Treaty and Decision 98/415/EC. ‘Given the 
objectives of Decision 98/415/EC … an opinion should only be sought from the ECB on such draft secondary legislation if the subject matter is closel y related to the ECB’s tasks and if the impact on 
areas within the ECB’s fields of competence is  different from that resulting from the primary 
legislation itself.’
12  
 3. Specific observations 3.1 The ECB recommends clarifying the definitions of ‘payment system’ and ‘securities settlement 
system’ set out in Article 2(4) and (6) of the draft regulation to avoid uncertainties, in particular in 
view of the definition of ‘system’ contained in  Law No 253/2004 on settlement finality in payment 
and securities settlement systems, which implem ents the Directive on settlement finality in 
payment and securities settlement systems
13. Furthermore, the definition of ‘significant 
infrastructure’ in Article 2(8) is rather open-ended. Therefore, the ECB would encourage establishing objective and transparent criteria, and making them publicly available. In addition, 
there is no reference to the oversight of cleari ng systems. Therefore, the draft regulation should 
include clearing systems in the scope of oversight conducted by BNR. 
                                                 
9  Article 3.1 of the ESCB Statute states that ‘[i]n accordance w ith Article 105(2) of this Treaty, the basic tasks to be carrie d 
out through the ESCB shall be … to promote the smooth operati on of payment systems.’ Article 22 states that ‘[t]he ECB 
and national central banks may provide facilities, and the ECB may make regulations, to ensure efficient and sound 
clearing and payment systems within the Community and with ot her countries’. See also Article 34.2, which states that a 
‘regulation shall have general application. It  shall be binding in its entirety and directly applicable in all Member States.’ 
10  The standards are av ailable on the ECB’s website at www.ecb.int. 
11  See  ECB Opinion CON/2006/52 of 14 November 2006 at the request of Latvijas Banka on a draft regulation on Latvijas 
Banka's securities settlemen t system, paragraph 2.1. 
12  Guide to consultation of the European Central Bank by natio nal authorities regarding draft legislative provisions, p. 14, 
available on the  ECB’s website at www.ecb.int. 
13  Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment and 
securities settlement systems (OJ L 166, 11.6.1998, p. 45). 
4 3.2 Article 3(f) and Article 7 refer to ‘persons th at issue and/or manage payment instruments’ and 
provide for their obligations under the draft regul ation, respectively. The scope of the term 
‘persons’ in these articles, as well as in the definition of ‘infrastructure’ in Article 2(7) of the draft 
regulation, is unclear and could lead to legal uncer tainty; therefore, the range of entities that fall 
within this category require clarification. 
3.3 In line with Article 6 of the draft regulati on, which mentions several measures to address 
operational risks, BNR could consider also me ntioning operational risk more generally in 
Article 5 (1)(b). 
3.4 According to Article 6(2)(b) significant infr astructure services operators ‘shall have the ... 
obligation … to promote interconnection with ot her infrastructures’. Since this constitutes a 
requirement imposed on entities subject to the scope of the draft regulation, against which they will 
be assessed, the obligation contained in this rule needs to be further clarified, because its exact 
content and scope of application is unclear14. 
3.5 Article 14 states that BNR will use the informa tion and data collected pursuant to Chapter III, 
Section I of the draft regulation to assess compliance by the entities subject to the draft regulation with specific requirements and principles applied by BNR in the field of oversight of payment 
systems, securities settlement systems and paym ent instruments. The ECB recommends adding to 
this purpose a more general purpose, which is the provision of data for participation in ESCB-
related tasks and also ensuring the general availability of information.  
3.6 With regard to the assessment of systems, ‘t he objectives and responsibilities as well as roles and 
major policies of … the central bank should be clearly defined and publicly disclosed’
15. Although 
there is a Memorandum of understanding16 between BNR, the National Securities Commission and 
the Insurance Supervisory Commission on cooperati on aimed at promoting the stability of the 
financial system under which the parties agree to  exchange information to ensure the proper 
licensing, regulation and supervision of the financ ial system, BNR could also set out the criteria 
under which BNR and the National Securities Commi ssion may exchange information in the draft 
regulation. 
                                                 
14  See paragraph 13 of ECB Opinion CON/2003/14 of 7 August 2003 at the request of Banca d’Italia on a draft regulation 
on payment systems, payment infrastructures and payment instruments. 
15  See CPSS-IOSCO Recommendations for securities se ttlement systems, 2001, No 18, paragraph 3.86. 
16  Signed on 10 March 2006, as amended by the Additional Act No 1 of 14.12.2006. 
5 3.7 Article 16(b) of the draft regulation states that  BNR ‘may apply sanctions, according to banking 
legislation’, if the persons performing activities subj ect to the scope of the draft regulation do not 
comply with the recommendations and/or adjustments set out by BNR. As the entities subject to the scope of the draft regulation may not always be  credit institutions, the reference to banking 
legislation under this Article 16(b) seems am biguous regarding its scope of application. 
 This opinion will be published on the ECB’s website.  Done at Frankfurt am Main, 21 September 2007. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET