Opinion of the European Central Bank at the request of the Council of the European Union on a recommendation for a Council Decision concerning exchange rate matters relating to the Cape Verde escudo (CON/98/57)
Date: 1998-12-17
Institutions: European Central Bank
Subjects: Cabo Verde, exchange transaction, monetary union, national currency

15.7.1999

EN

Official Journal of the European Communities

C 200/7

the arrangements for the negotiation and conclusion of
monetary or
foreign exchange regime agreements with
foreign States. In this regard, the ECB draws attention to
the fact
the Treaty these
arrangements shall ensure that the Community expresses a
single position.

that under Article 109(3) of

shall

France

inform the

European
only
Decision
Commission and the Economic and Financial Committee
in advance of modifications to the agreements to the
extent that the nature or scope of the agreements remain
unchanged. The ECB considers that
the ECB should be
directly included in all aspects of the process for the same
reasons as set forth in paragraph 4 above.

the competent French authorities

5. Furthermore, while Article 3 of the draft Decision provides
shall keep the
that
European Commission,
the ECB and the Economic and
Financial Committee informed on a regular basis about
the implementation of
the agreements, the French auth-
orities shall only inform the European Commission and
the Economic and Financial Committee prior to changes
the partity between the euro and the CFA franc or
of
Comorian franc. In addition, under Article 4 of the draft

6. This Opinion will be published in the Official Journal of the

European Communities.

Done at Frankfurt am Main, 22 September 1998.

The Vice-President of the ECB

C. NOYER

OPINION OF THE EUROPEAN CENTRAL BANK

at the request of the Council of the European Union on a recommendation for a Council Decision
concerning exchange rate matters relating to the Cape Verde escudo

(CON/98/57)

(1999/C 200/06)

1. On 11 December 1998 the European Central Bank (ECB)
received a request from the Council of the European Union
for an opinion on a proposal for a Council Decision on the
abovementioned topic (hereinafter referred to as the draft
Decision). Document COM(1998) 663 final dated 18
november 1998, containing the draft Decision and an
explanatory memorandum, was transmitted to the ECB.
The ECB’s competence to deliver an opinion is based on
the second subparagraph of Article 109l(1) in conjuntion
with Article 109(3) of the Treaty establishing the European
Community (hereinafter
In
accordance with the first sentence of Article 17.5 of the
this opinion has been
the ECB,
Rules of Procedure of
adopted by the Governing Council of the ECB.

referred to as

the Treaty).

escudo. The draft Decision provides

Portuguese
that
Portugal and Cape Verde shall retain sole responsibility for
the implementation of this agreement. The draft Decision
also provides for various procedural requirements on the
part of
to the
the Portuguese authorities with respect
implementation of Portugal’s present agreement with Cape
Verde, the negotiation and conclusion of modifications to
this agreement and the submission of any plans to change
the nature and scope of the agreement. In fact, the draft
Decision is, to a large extent, similar to an earlier Decision
concerning exchange rate matters relating to the CFA franc
and the Comorian franc, on which the ECB was consulted
on 24 July 1998 and on which it delivered an opinion on
22 September 1998 (CON/98/37;
in this opinion also
referred to as the (cid:145)French case(cid:146)).

2. The draft Decision provides that Portugal may continue its
present agreement concerning exchange rate matters with
the euro for the
Cape Verde upon the substitution of

3. The ECB notes with satisfaction that its observations with
regard to the above Decision in the French case have also
been incorporated into the present draft Decision.

C 200/8

EN

Official Journal of the European Communities

15.7.1999

(cid:151) Recital 7 stresses that the agreement, and any modifi-
cations thereto, do not impose any obligations on the
ECB and the national central banks (NCBs) to support
the convertibility of the Cape Verde escudo.

the modification or
that
(cid:151) Recital 10 emphasises
implementation of
shall be without
the agreement
prejudice to the primary objective of the Community’s
in
exchange rate policy to maintain price stability,
accordance with Article 3a(2) of the Treaty.

However, the ECB also notes that Articles 3, 4 and 5 of the
draft Decision do not fully incorporate the ECB’s obser-
vations on the ECB’s consultative role under the Treaty as
laid down in the ECB’s Opinion CON/98/37, but that the
draft Decision in this respect at the same time mirrors the
Decision in the French case, which reflects at least a part of
the ECB’s observations.

4. This opinion will be published in the Official Journal of the

European Communities.

(cid:151) Recital 13 states

that

the draft Decision does not
establish a precedent in respect of any arrangements
that may be decided in the future with regard to the
negotiation and conclusion of
agreements
concerning monetary or foreign exchange rate matters
by the Community with other States or international
organisations.

similar

Done at Frankfurt am Main, 17 December 1998.

The President of the ECB

Willem F. DUISENBERG