Opinion of the European Central Bank of 16 February 2009 at the request of the Bulgarian Ministry of Justice on a draft law supplementing the Law on Administration (CON/2009/13)
Date: 2009-02-16
Institutions: European Central Bank
Subjects: Bulgaria, central bank, conflict of interest, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 16 February 2009  

at the request of the Bulgarian Ministry of Justice 

on a draft law supplementing the Law on Administration 

(CON/2009/13) 

Introduction and legal basis 

On 19 January 2009 the European Central Bank (ECB) received a request from the Bulgarian Minister for 

Justice for an opinion on a draft law supplementing the Law on Administration and amending, inter alia, 

the  Law  on  the  prevention  and  disclosure  of  conflicts  of  interests  (hereinafter  the  ‘Law  on  conflicts  of 
interests’)1 and the Law on Българска народна банка (Bulgarian National Bank) (BNB) (hereinafter the 
‘Law on BNB’)2 (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 
provisions3, as the draft law relates to Българска народна банка (Bulgarian National Bank) (BNB). 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 

1.1  The draft law supplements the Law on Administration and brings all relevant Bulgarian legislation 

in line with the Law on conflicts of interests. In this latter regard, the draft law amends, inter alia, 

the  Law  on  the  BNB  by  (i) introducing  additional  eligibility  criteria  for  membership  in  BNB’s 

Governing Council, and (ii) providing details as to the competent authority to which information to 

be disclosed under Article 12(1) to (4) of the Law on conflicts of interests should be provided.  

1.2  According  to  the  provisions  of  the  draft  law  amending  the  Law  on  conflicts  of  interests,  BNB’s 

Governor, Deputy Governors and Governing Council members are exempt from the prohibition on 

entering into an employment or any other agreement with certain business entities or cooperatives 

or  becoming  a  partner  in,  holding  interests  or  shares  in,  and  acting  as  a  manager  or 

1 
2 
3 

Published in Darjaven vestnik No 94, 31.10.2008 (in force as of 1.1.2009). 
Published in Darjaven vestnik No 46, 10.6.1997. 
OJ L 189, 3.7.1998, p. 42. 

 
 
 
 
                                                 
management/supervisory body member  of such  business entities and cooperatives for a period of 
one year following their tenure of office4. 

2. 

General observations  

2.1  The  ECB  welcomes  the  Bulgarian  authorities’  efforts  to  align  the  Law  on  BNB  and  the  Law  on 

conflicts of interests with the Statute of the European System of Central Banks and of the European 

Central  Bank  (hereinafter  the  ‘ESCB  Statute’)  and  with  the  conclusions  contained  in  the  ECB’s 
May 2008 Convergence Report5. 

2.2  However, it is important to note that the Bulgarian authorities failed to comply with their obligation 

to  consult  the  ECB  prior  to  adopting  the  Law  on  conflicts  of  interests  on  16 October 2008.  The 

ECB  should  have  been  consulted  on  the  Law  on  conflicts  of  interests,  since  it  sets  additional 

grounds for the dismissal of BNB’s Governing Council members and, therefore, clearly falls within 

the scope of the third indent of Article 2(1) of Decision 98/415/EC as it relates to national central 

banks, which is expressly listed among the areas in which the ECB is competent.  

3. 

Specific observations 

Law on conflicts of interests 

3.1  The Law on conflicts of interests provides a definition of ‘conflicts of interests’ and regulates the 

prevention  and  disclosure  of  conflicts  of  interests  of  public  office  holders.  It  also  establishes  a 

procedure for identifying the existence of conflicts of interests and the consequences resulting from 

such situations. Under the Law on conflicts of interests, non-compliance with its provisions and the 

fact  that  a  conflict  of  interests  exists  are  sufficient  grounds  for  dismissal  and  could  lead  to  the 

termination of the affected person’s appointment/mandate. According to Article 3(13) of the Law 

on conflicts of interests, BNB’s Governor, Deputy Governors and Governing Council members fall 

within the definition of public office holders. As a result, the Law on conflicts of interests specifies 

grounds for their dismissal that are in addition to the two grounds contained in the ESCB Statute. 

3.2  Governors  and  other  members  of  the  NCBs’  decision-making  bodies  who  are  involved  in  the 

performance of ESCB-related tasks may not be dismissed for reasons other than those mentioned in 
Article  14.2  of  the  ESCB  Statute6.  The  draft  law  does  not  remove  these  additional  grounds  of 

dismissal. Therefore, the Law on conflicts of interests is still incompatible with ESCB Statute and 

Treaty  requirements  on  central  bank  independence.  The  ECB  urges  the  Bulgarian  authorities  to 

4 
5  
6  

See § 47 of the draft law proposing amendments to Article 21(1) of the Law on conflicts of interests. 
Available on the ECB’s website at www.ecb.europa.eu. 
See the ECB’s Convergence Report of May 2008, p. 19, which specifies that ‘NCB statutes must ensure that Governors 
may  not  be  dismissed  for  reasons  other  than  those  mentioned  in  Article  14.2  of  the  Statute.  The  purpose  of  this 
requirement  is  to  prevent  the  authorities  involved  in  the  appointment  of  Governors,  particularly  the  government  or 
parliament, from exercising their discretion to dismiss them as Governor. The NCB statutes should either contain grounds 
for dismissal which are compatible with those laid down in Article 14.2 of the Statute, or omit any mention of grounds 
for dismissal (since Article 14.2 is directly applicable).’ 

2 

 
 
                                                 
fully align the provisions of Article 33(1) of the Law on conflicts of interests with Article 14.2 of 

the ESCB Statute. 

Law on BNB 

3.3  The proposed amendment to Article 11(4) of the Law on BNB sets out additional eligibility criteria 

related  to  the  appointment  and  election  of  BNB’s  Governing  Council  members.  Specifically,  a 

person may not be appointed or elected as a member of BNB’s Governing Council if, at the time of 

their  appointment  or  election  they  (i)  are  pursuing  a  business  activity  under  any  legal  form 

whatsoever  or  are  acting  as  a  manager,  procurator,  liquidator,  receiver  or  member  of  the 
management or a supervisory body of a company or cooperative7, or (ii) are a spouse of, are living 

with,  are  a  relative  in  direct  lineage  or  lateral  lineage  up  to  and  including  fourth  degree,  or  are 

connected by marriage up to the and including the second degree to a member of BNB’s Governing 
Council8. 

3.4  The ECB notes that the first ground for removal in Article 14.2 of the ESCB Statute states that a 

Governor may be relieved from office  only if he no longer fulfils the conditions required for the 

performance of his duties. The ECB acknowledges that Member States are free to set the conditions 

required for the appointment of the NCB Governing Council members. However, Article 14(1) of 

the Law on BNB, which regulates the grounds for dismissal for appointed or elected members of 

the  BNB’s  Governing  Council,  contains  grounds  for  dismissal  in  addition  to  Article  14.2  of  the 

ESCB  Statute  by  cross-referencing  to  the  appointment  and  election  conditions  set  out  in 
Article 11(4)  of  the  Law  on  BNB9.  Article 14(1)  of  the  Law  on  BNB  should,  therefore,  be  fully 

aligned with the wording of Article 14.2 of the ESCB Statute. 

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

Done at Frankfurt am Main, 16 February 2009. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

7  
8  
9  

See paragraph 1 of § 13 of the draft law proposing the insertion of subparagraph 4 in Article 11(4) of the Law on BNB.  
See paragraph 1 of § 13 of the draft law proposing the insertion of subparagraph 5 in Article 11(4) of the Law on BNB.  
See the ECB’s Convergence Report of May 2008, p. 229, paragraph 3.2 of ECB Opinion CON/2008/73 of 21 November 
2008  at  the  request  of  Българска  народна  банка  (Bulgarian  National  Bank)  on  a  draft  law  amending  the  Law  on 
Българска  народна  банка  (Bulgarian  National  Bank),  and  paragraph 3.2.1  of  ECB Opinion CON/2008/21  of 
21 May 2008 at the request of Česká národní banka on a draft law on Česká národní banka. 

3