EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 7 January 2008 
at the request of the Czech Ministry of Finance  
on a draft law concerning the distribution of powers between the Ministry of Finance and  
Česká národní banka to prepare and submit certain draft laws to the Government 
(CON/2008/2) 
 
Introduction and legal basis  
On 12 November 2007 the European Central Bank (ECB) received a request from the Czech Ministry of 
Finance for an opinion on a draft law amending Law No 2/1969 Coll. on the establishment of ministries and other central administrative bodies of the Czec h Republic, as amended (hereinafter the ‘Law on 
competences’), and Law No 6/1993 Coll. on Česká národní banka, as amended (hereinafter the ‘Law on 
ČNB) (hereinafter the ‘draft law’). 
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 Česká národní banka ( ČNB). In accordance with  the first sentence 
of Article 17.5 of the Rules of Procedure of th e European Central Bank, the Governing Council has 
adopted this opinion. 
 1.  Purpose of the draft law 
Under the draft law, the Law on competences is amende d to extend the Ministry of Finance’s competence 
to cover the areas of the single currency of the European Communities and payment systems
2. The Law 
on ČNB will be amended so that ČNB will no longer have the exclusive power to prepare and submit to 
the Government draft laws on currency, circulation of money, the money market, payment systems and 
on the status, competence, organisation and activities of ČNB. Draft laws in these areas, with the 
exception of payment systems, will be prepared and submitted by ČNB jointly with the Ministry of 
                                                 
1  OJ L 189, 3.7.1998, p. 42. 
2  Pursuant to Article 4(1) of the Law on competences, the Mini stry of Finance is the central administrative body for, inter 
alia, the financial market and the protec tion of consumer interests on the financ ial market, save for financial market 
supervision to the extent entrusted to ČNB, and also for foreign exchange affairs.  In areas falling within its competence, 
the Ministry of Finance is responsible for preparing draft laws. 
 
2 Finance3. In the areas of the single currency, payment systems, the regulation of electronic money 
issuance and foreign exchange management, ČNB will assist the Ministry of Finance in preparing draft 
laws.4 
 2. General observations  The ECB has several concerns in relation to the pro posed redistribution of legislative power between the 
Ministry of Finance and ČNB as provided for under the draft law, which are set out below.  
 3. The Ministry of Finance’s competences 3.1 The single currency   
3.1.1 According to the proposed amendment to Article  4 of the Law on competences, the Ministry of 
Finance is the central administrative body for, in ter alia, ‘the single currency of the European 
Communities’. The scope of this provision should be limited to facilitating the preparation and 
introduction of the euro in the Czech Republic. Th e wording of the draft law should therefore be 
revised to make it clear that it only applies to  the preparation and introduction of the single 
currency. This would help to avoid any possible misunderstanding about the interpretation of the 
provision, which could be considered as conflicti ng with the Community legal framework. In this 
regard, the ECB underlines that one of the basic tasks to be carried out  through the European 
System of Central Banks (ESCB) is to defi ne and implement the monetary policy of the 
Community
5. According to Article 106 of the Treaty, the ECB has the exclusive right to authorise 
the issue of banknotes within the Community, and the ECB and the national central banks (NCBs) 
may issue such notes, whereas Member States may i ssue coins subject to approval by the ECB of 
the volume of the issue.  
3.1.2 As a more general remark, it should be emphasi sed that the adoption of the single currency by a 
Member State with a derogation is subject to Artic les 121 and 122 of the Treaty. In this respect, the 
ECB notes that the ECB’s convergence reports, on  the progress made in the fulfilment by the 
Member States of their obligations regarding the achievement of economic and monetary union, are 
required to include an examination of the compat ibility between the national legislation of such 
Member States and Articles 108 and 109 of the Treaty. 
                                                 
3  See Part II, Section II, pa ragraph 1 of the draft law. 
4  See Part II, Section II, paragraph 3 of the draft law. Such obligatory assistance of ČNB is already required with respect to 
the preparation of draft laws in the area of the financial market. 
5  See Article 105(2), first indent, of the Treaty establishing the European Community, which is mirrored in Article 3.1, first 
indent, of the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the ‘ESCB 
Statute’). 
 
3 3.2 Payment systems  
According to the proposed amendment to Article 4 of the Law on competences, the Ministry of 
Finance is the central administrative body for, inte r alia, ‘payment systems, without prejudice to the 
fields of competence of Česká národní banka pursuant to other legislation’. The ECB notes that, 
upon the future abrogation of the Czech Republic’s derogation, this provision could result in a 
conflict with the Community legal framework in this area. In particular, one of the basic tasks to be 
carried out through the ESCB is the promotion of the smooth operation of payment systems6. 
Moreover, the ECB and NCBs may provide facilities,  and the ECB may make regulations, to ensure 
efficient and sound clearing and payment systems within the Community and with other countries7. 
3.3 Foreign exchange affairs   
3.3.1 Under Article 4 of the Law on competences, the Ministry of Finance is the central administrative 
body for, inter alia, ‘foreign exchange affairs in cluding the state’s claims and obligations towards 
foreign entities’. In general, the ECB notes in this  context that a ‘Member State with a derogation 
may retain national legislation which provides that  the government is responsible for the exchange 
rate policy of that Member State, with a consu ltative and/or executive role being granted to the 
NCB. However, by the time that Member State adopt s the euro, such legislation has to reflect the 
fact that responsibility for the euro area’s exchange rate polic y has been transferred to the 
Community level in accordance with Article 111 of the Treaty. Article 111 assigns the responsibility for such policy to the EU Council, in close cooperation with the ECB’
8.  
3.3.2 The ECB would also like to point out that Articles 35 and 36 of the Law on ČNB assign a wide 
range of responsibilities related to foreign exchange management to ČNB. Therefore, an 
amendment to Article 4 of the Law of competences could be considered in order to better distinguish the responsibilities of the two authorities in this area. 
 4. Legislative powers concerning ČNB as the central bank 
Under the proposed amendment to Article 37(1) of the Law on ČNB, together with the Ministry of 
Finance ČNB will ‘prepare and submit to th e Government draft laws … concerning the status, fields of 
competence, organisation and activities of Česká národní banka as the central bank of the Czech 
Republic’. The ECB notes that the draft law implie s that legislation in certain areas in which ČNB does 
not act as the central bank can be submitted to the Government only by the Ministry of Finance, and not ČNB. The Ministry of Finance can, for example within  its powers as the central administrative body in 
charge of the financial market, independently submit to  the Government draft laws concerning the status, 
fields of competence, organisation and activities of ČNB to the extent this is without prejudice to ČNB’s 
position as the central bank. Where based on such laws ČNB is entrusted with additional tasks or its tasks 
                                                 
6  Article 105(2), fourth indent, of the Treaty, which is mirro red in Article 3.1, fourth indent, of the ESCB Statute. 
7  Article 22 of the ESCB Statute. 
8  See the ECB’s Convergence Report 2007, p. 26,  available on the ECB’s website at www.ecb.int.  
 
4 are being changed, the ECB would reiterate that Member States may not put their NCBs in a position 
where they have insufficient financial resources to ca rry out their ESCB- or Eurosystem-related tasks, as 
applicable9. Therefore, the ECB expects that, when extending or otherwise changing ČNB’s tasks, 
sufficient financial and personnel resources will be available to ČNB, both in terms of quantity and 
quality to carry out all its tasks, and in particular th at its capacity to carry out ESCB-related tasks will not 
be affected10. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 7 January 2008. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
 
                                                 
9  See the ECB’s Convergence Report 2007, p. 19, available on the ECB’ s website at www.ecb.int .  
10 See for example ECB Opinion CON/2007/8 of 21 March 2007 at the request of the Czech Ministry of Industry and Trade 
on certain provisions of a draft law amending the Law on consumer protection relating to Česká národní banka.