Opinion of the European Central Bank of 16 January 2009 at the request of the Belgian Minister for Finance on a draft law amending the financial provisions of the Law of 22 February 1998 establishing the Organic Statute of the Nationale Bank van België/Banque Nationale de Belgique (CON/2009/4)
Date: 2009-01-16
Institutions: European Central Bank
Subjects: Belgium, balance of payments, central bank, financial year, national law, profit

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 16 January 2009 

at the request of the Belgian Minister for Finance 

on a draft law amending the financial provisions of the Law of 22 February 1998 establishing the 

Organic Statute of the Nationale Bank van België/Banque Nationale de Belgique 

(CON/2009/4) 

Introduction and legal basis 

On 9 December 2008 the European Central Bank (ECB) received a request from the Nationale Bank van 

België/Banque Nationale de Belgique (NBB), acting on behalf of the Belgian Minister for Finance, for an 

opinion on a draft law amending the financial provisions of the Law of 22 February 1998 establishing the 

Organic Statute of the Nationale Bank van België/Banque Nationale de Belgique (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 
provisions1, as the draft law relates to the NBB. 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 law 

The purpose of the draft law is to adapt the current rules governing the distribution of the NBB’s income 

to  ensure  that  after  payments  of  the  NBB’s  costs,  maintenance  of  its  reserves  and  remuneration  of  its 

capital, the balance of the NBB’s income is allocated to the Belgian State, without prejudice to the rights 
of  the  NBB’s  shareholders  including  rights  to  dividends2.  To  this  end,  the  draft  law  introduces  two 

changes.  First,  it  repeals  the  current  so  called  ‘3 %  rule’  which  determines  how  much  of  its  financial 
proceeds the NBB may retain to cover its costs, maintain its reserves and remunerate its capital3. Second, 
it  amends  the  current  rule  governing  the  distribution  of  the  NBB’s  annual  profits4  by  providing  that5: 

1  
2  
3  

4  

OJ L 189, 3.7.1998, p. 42.  
See the Explanatory memorandum to the draft law, in particular p. 4. 
Pursuant  to  the  ‘3 %  rule’,  the  net  financial  proceeds  in  excess  of  3 %  of  the  difference  between  the  average  amount, 
calculated on an annual basis, of the NBB’s profit-earning assets and remunerated liabilities is assigned to the Belgian 
State  (current  Article 29  of  the  Law  of  22  February  1998  establishing  the  Organic  Statute  of  the  Nationale  Bank  van 
België/Banque Nationale de Belgique, hereinafter the ‘NBB Law’). This provision is repealed by Article 2 of the draft 
law. 
Under the current Article 32 of the NBB Law, one fifth of the NBB’s annual profit is allocated to the Belgian State, after 
payment of a first dividend of 6 % of the NBB’s capital to shareholders and allocation of 10 % of the remainder of the 
annual profits to the reserve fund, and 8 % of the same remainder to the NBB’s staff or to institutions in its favour.  

 
 
 
 
                                                 
(i) from the excess of these profits after allocation to shareholders of a first dividend of 6 % of the NBB’s 

capital, an amount proposed by the NBB’s Board of Directors and established by its Council of Regency 
is  independently  allocated  to  the  reserve  fund  or  to  the  available  reserves6;  (ii)  then,  from  the  second 

excess,  a  second  dividend  established  by  the  Council  of  Regency  of  a  minimum  of  50 %  of  the  net 

proceeds  from  assets  forming  the  counterpart  to  the  reserve  fund  and  available  reserves  is  allocated  to 

shareholders;  and  (iii)  finally,  the  balance  is  allocated  to  the  State.  The  ECB  understands  that  as  these 

provisions enter into force on 1 January 2009, they do not modify the rules governing the distribution of 

the NBB’s income for the financial year 2008.  

2.  General observations 

2.1  The draft law should be analysed from the angle of the requirements of central bank independence, 
namely  financial  independence7.  The  concept  of  financial  independence  should  be  assessed  from 

the perspective of whether any third party is able to exercise either direct or indirect influence not 

only  over  the  tasks  of  a  national  central  bank  (NCB),  but  also  over  its  ability  -  understood  both 
operationally in terms of manpower8, and financially in terms of appropriate financial resources - to 

fulfil its mandate. The NCBs  must  also, at all times,  have sufficient financial means to carry out 

their other functions, i.e. to perform their national tasks, to meet their international obligations and 

properly cover their administrative and operational expenses. It should be noted that Articles 28.1 

and 30.4 of the Statute of the European System of Central Banks and of the European Central Bank 

provide for further calls on the NCBs to make further contributions to the capital of the ECB and to 

make  further  transfers  of  foreign  reserves.  The  principle  of  financial  independence  requires  that 

compliance  with  these  provisions  leaves  an  NCB’s  ability  to  perform  its  functions  unimpaired. 

With regard to profit allocation, an NCB’s statutes may prescribe how profits are to be allocated. In 

the absence of such provisions, the decision on allocation of profits should be taken by the NCB’s 

decision-making  bodies  on  professional  grounds,  and  should  not  be  subject  to  the  discretion  of 

third parties unless there is an express safeguard clause stating that this is without prejudice to the 

financial  means  necessary  for  carrying  out  the  NCB’s  tasks  related  to  the  European  System  of 

Central Banks.  

2.2  The  ECB  generally  welcomes  the  draft  law  as  it  makes  the  rules  governing  distribution  of  the 

NBB’s  income  clearer  and  allows  the  NBB’s  bodies  the  necessary  discretion  to  decide  on  the 

allocation of profits. In this respect, the draft law expressly refers to the independence of the NBB’s 

5  
6  

7  

8  

Article 3 of the draft law, amending Article 32 of the NBB Law. 
The draft law introduces provisions enabling the maintenance of an available reserve. The available reserve can be used 
to offset losses or for the distribution of profits (see the Explanatory memorandum to the draft law, p. 5). 
On  the  concept  of  central  bank  independence  and  in  particular  financial  independence,  see  the  ECB’s  Convergence 
Report May 2008, p. 17 and in particular p. 20 et seq.; see also ECB Opinion CON/2008/82 of 2 December 2008 at the 
request of the Spanish State Secretary for Economic Affairs on a draft royal decree on the arrangements for paying the 
Banco de España’s profits to the Treasury. All ECB opinions are available on the ECB’s website at www.ecb.europa.eu.  
See  ECB  Opinion  CON/2008/9  of  21  February  2008  at  the  request  of  the  German  Ministry  of  Finance  on  a  draft  law 
amending the Law on the Deutsche Bundesbank; also ECB Opinion CON/2008/10 of 21 February 2008 at the request of 
the Italian Ministry of Economic Affairs and Finance on some provisions of the Law on the State annual and pluriannual 
budget (2008 Budget law).  

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bodies in deciding on the NBB’s reserves policy9. The ECB also understands that, as is already the 

case  under  the  current  rules,  if  the  NBB’s  annual  profits  are  lower  than  6 %  of  its  capital,  the 
amount  of  this  first  dividend10  is  drawn  on  the  NBB’s  reserve  fund11.  If  the  reserve  fund  is 

insufficient to cover this amount, distributed profits would be adjusted accordingly.  

3. 

Specific comments  

Besides  amending  the  financial  provisions  of  the  NBB  Law,  the  draft  law  allows  the  NBB’s  ordinary 

general  meeting  of  shareholders  to  be  postponed  to  the  last  Monday  of  May  (instead  of  March,  as  is 
currently the case)12. The ECB understands that this postponement takes account of the extension of the 

legal deadlines for making the necessary documents available to shareholders prior to the general meeting 

and, in this context, aims to avoid a situation where the ECB’s results might be deducible from the NBB’s 

annual  accounts  before  the  ECB  publishes  its  own  annual  accounts.  In  this  respect,  the  Explanatory 
memorandum  to  the  draft  law13  would  benefit  from  a  clarification  that  the  ECB’s  annual  accounts  are 

published on the ECB’s website before the publication of the ECB’s annual report, which takes place in 

April. 

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

Done at Frankfurt am Main, 16 January 2009. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

9  

10  
11  

12  
13  

Article 3 of the draft law, introducing a new Article 32, 2° in the NBB law. See also the clarification in the Explanatory 
memorandum to the draft law that such decisions are not subject to the monitoring and suspension powers of the Minister 
of Finance’s representative (p. 7). 
See paragraph 1 and footnote 4 above. 
Article 50 of the NBB’s statutes in conjunction with Article 31 of the NBB Law. The ECB understands that the NBB’s 
reserve fund comprises retained earnings and is notably intended to  supplement any shortfall in the annual profit up to a 
dividend of 6 % of the NBB’s capital (Article 31 of the NBB Law). In such case, any amount drawn on the reserve fund 
must  be  refunded  to  the  reserve  if,  in  the  following  year,  such  refund  can  be  made  without  reducing  the  profit  for 
distribution to below 6 % of the NBB’s capital. 
Article 4 of the draft law. 
See the Explanatory memorandum to the draft law, comments concerning Article 4, p. 8. 

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