Opinion of the European Central Bank of 12 December 2005 at the request of the Ministry of Finance of the Slovak Republic on a draft law amending the State Treasury Act (CON/2005/55)
Date: 2005-12-12
Institutions: European Central Bank
Subjects: Slovakia, Treasury, central bank, national law, public debt

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 12 December 2005  

at the request of the Ministry of Finance of the Slovak Republic on a draft law amending the State 

Treasury Act 

(CON/2005/55) 

1.  On  27  October  2005  the  European  Central  Bank  (ECB)  received  a  request  from  the  Ministry  of 

Finance of the Slovak Republic on a draft law amending the Act No 291/2002 Coll. on the State 

Treasury and on amendments to certain laws, as last amended, and amending the Act No 523/2004 

Coll.  on  the  budgetary  rules  of  public  administration  and  on  amendments  to  certain  laws,  as  last 

amended (hereinafter the ‘draft law’).  

2. 

The ECB’s competence to deliver an opinion is based on 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 law contains provisions concerning a 

national central bank (NCB). 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. 

3.  According to the explanatory memorandum to the draft law, the amendments proposed in the draft 

law are based on practical experience with the operation of the State Treasury system in 2004 and 

2005 and their main objective is to facilitate the maintenance and further development of the State 

Treasury system as an advanced tool for managing public finance in Slovakia. The ECB also notes 

that  the  draft  law  amends  a  number  of  provisions  of  the  current  version  of  the  Act  No  291/2002 

Coll.  on  the  State  Treasury  and  on  amendments  to  certain  laws,  as  last  amended  (hereinafter  the 

‘State Treasury Act’) in relation to Národná banka Slovenska’s (NBS)  fiscal agency tasks and its 

compliance  with  the  prohibition  on  monetary  financing  under  Article  101(1)  of  the  Treaty 

establishing the European Community.  

4. 

It is noted that the ECB was consulted recently on amendments to the Act No 566/1992 Coll. on 
Národná  banka  Slovenska,  as  last  amended  (hereinafter  the  ‘NBS  Act’)2.  In  its  Opinion 

CON/2005/26, the ECB assessed whether the proposed amendments to the NBS Act complied with 

the  prohibition  on  monetary  financing  under  the  Treaty  and  also  considered  the  the  relevant 

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2  

OJ L 189, 3.7.1998, p. 42. 
ECB Opinion CON/2005/26 of 4 August 2005 at the request of Národná banka Slovenska on a draft law amending the 
Act No 566/1992 Coll. on NBS, as amended, and on amendments to certain laws. 

 
 
 
                                                      
provisions of the State Treasury Act, noting that ‘both the draft law3 [amending the NBS Act] and 

the State Treasury Act contain important safeguards ensuring the compatibility of such operations 

with the prohibition on monetary financing contained in Article 101(1) of the Treaty establishing 
the European Community4’. Moreover, the ECB welcomed the new provisions concerned and noted 

that  ‘the  services  currently  provided  by  NBS  to  the  State  Treasury  and  the  Agency  for  Debt  and 
Liquidity Management do not appear to go beyond the scope of what is permissible5’. 

5. 

The  ECB  notes  that  the  draft  law  partially  reformulates  the  provisions  of  the  State  Treasury  Act 
concerning  the  ‘single  account6’,  which  is  a  memorandum  account  containing  a  summary  of  the 

balances  of  all  State  Treasury  accounts  held  with  NBS.  The  draft  law  provides  for  a  new  State 

Treasury  client  named  the  ‘State  Debt’.  Financial  operations  performed  on  the  State  Debt’s 

accounts  relate  to  financing  of  the  state  budget  deficit  and  the  state  debt,  risk  management  and 
investment of temporarily uncommitted resources7. The ECB notes too that the State Debt may also 

open  an  account  with  NBS  outside  the  scope  of  the  State  Treasury  scheme  in  order  to  invest 

temporarily  uncommitted  resources  and  to  carry  out  financial  operations  relating  to  risk 

management. While the draft law lifts the existing obligation for individual State Treasury accounts 
held with NBS to show a credit balance8, the ECB welcomes the fact that the draft law stipulates 
that the single account9 held with the State Treasury as well as the State Debt account10 held with 

NBS must at all times show a credit balance. At the same time the ECB notes that pursuant to the 

NBS Act, NBS may carry out payments from State Treasury accounts only up to the level of the 
credit balance on these accounts11. Finally, the ECB takes note that the draft law does not amend 

any existing provisions of the State Treasury Act which ensure compliance with the prohibition on 

overdraft facilities or any other type of credit facility with NBS in favour of the State Treasury as 

laid down in Article 101(1) of the Treaty. In fact, the draft law reproduces the important safeguard 
that the single account must at all times show a credit balance.12 In order to ensure that the State 

Treasury observes its obligations in this respect, there are also safeguards to ensure that (i) only the 

State Treasury is empowered to settle payments from State Treasury accounts held with NBS and 
recorded in the single account13; (ii) a client of the State Treasury may request the State Treasury to 

execute expenditure only if the request for execution of the payment has been approved by the State 

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It  is  noted  that  the  draft  law  [amending  the  NBS  Act],  which  was  the  subject  of  ECB  Opinion  CON/2005/26,  was 
published  on  28  November  2005  in  the  Collection  of  Laws  of  the  Slovak  Republic  as  the  Act  No  519/2005  Coll.  on 
amendments to the Act No 566/1992 Coll. on Národná banka Slovenska, as amended, and on amendments to certain laws.  
See Paragraph 12 of ECB Opinion CON/2005/26. 
Ibid. 
See the proposed new Article 11(1) of the State Treasury Act. 
See the proposed new Article 2c(1) of the State Treasury Act. 
Currently provided for in Article 11(2) of the State Treasury Act. 
See the proposed new Article 11(2) of the State Treasury Act. 
See the proposed new Article 2c(5) of the State Treasury Act. 
Article 25(2) of the NBS Act. 
See the proposed new Article 11(2) of the State Treasury Act. 
See the proposed new Article 11(4) of the State Treasury Act. 

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Treasury14; and (iii) the State Treasury must compare the request for execution of the payment with 

the  credit  balance  on  the  client  account.  Where  there  is  a  discrepancy  between  the  total  payment 

stated in the request for payment execution and the credit balance on the client account, the State 

Treasury may not approve the request for payment execution and must inform the client thereof at 
the latest within one working day following the maturity date of the requested payment15. 

6. 

The  ECB  takes  note  that  the  draft  law  refers  to  the  State  Treasury’s  obligation  ‘to  compile 

aggregate data intended for international organisations and the European Union in accordance with 
the  requirements  of  the  Ministry  of  Finance16’.  In  this  context,  the  ECB  notes  that  NBS  and 

Štatistický  úrad  Slovenskej  Republiky  have  to  provide  annual  and  quarterly  government  finance 

statistics  in  compliance  with  Community  law,  including  with  the  requirements  laid  down  in 

Guideline  ECB/2005/5  of  17  February  2005  on  the  statistical  reporting  requirements  of  the 

European  Central  Bank  and  the  procedures  for  exchanging  statistical  information  within  the 
European System of Central Banks in the field of government finance statistics17. In this regard, the 

basic  statistical  information  provided  by  the  State  Treasury  should  ideally  support  the  efficient 

performance  of  this  obligation.  A  progressive  alignment  of  the  Slovak  public  accounting  system 

with  national  accounting  standards  would  also  support  the  provision  of  reliable  information  on 

public finances. 

7. 

This opinion will be published on the ECB’s website. 

Done at Frankfurt am Main, 12 December 2005. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

14  
15  
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17  

See the proposed new Articles 9(4) and 9a(5) of the State Treasury Act. 
See the proposed new Articles 9(5) and 9a(6) of the State Treasury Act. 
See the proposed new Article 6(3)(b) of the State Treasury Act. 
OJ L 109, 29.4.2005, p. 81. 

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