Opinion of the European Central Bank of 7 September 2011 on Italy’s ratification of an Amendment to the Articles of Agreement of the International Monetary Fund and increase in quota (CON/2011/68)
Date: 2011-09-07
Institutions: European Central Bank
Subjects: International Monetary Fund, Italy, national law, revision of an agreement

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 7 September 2011 

on Italy’s ratification of an Amendment to the Articles of Agreement of the International Monetary 

Fund and increase in quota  

(CON/2011/68) 

Introduction and legal basis 

On  10  August  2011,  the  European  Central  Bank  (ECB)  received  a  request  from  the  Italian  Ministry  of 

Economic Affairs and Finance for an opinion on a draft law regarding the ratification of an Amendment 

to  the  Articles  of  Agreement  (hereinafter  the  ‘Amendment’)  of  the  International  Monetary  Fund  (IMF) 

and the increase of Italy’s quota with the IMF (the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning of the European Union 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 Banca d’Italia. 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  On  15  December  2010,  the  IMF  Board  of  Governors  adopted  Resolution  No  66-2  on  the 

‘Fourteenth  General  Review  of  Quotas  and  Reform  of  the  Executive  Board’,  proposing  an 

amendment  to  the  Articles  of  Agreement.  The  Amendment  contains  two  sets  of  provisions.  The 

first set provides that all the Executive Directors on the IMF Executive Board will be elected by 

IMF  member  countries.  The  second  set  of  provisions  concerns  a  general  review  of  quotas,  after 
which  the  increase  in  quotas  will  become  effective  on  fulfilment  of  specific  conditions2.  As  a 

consequence  of  the  increase  in  quotas,  a  review  of  the  ‘New  Arrangements  to  Borrow’  (NAB) 

credit arrangements will take place, with the possibility for the NAB to roll back. 

1.2  Under  Italian  law3,  the  ratification  of  international  agreements  involving  public  expenditure  and 

amendments to legislation must be authorised by a law approved by the Parliament. Articles 1 and 

1  
2  

3  

OJ L 189, 3.7.1998, p. 42.  
The  specific  conditions  to  be  fulfilled are  as  follows:  (i)  members  with  at  least  70%  of  the  total quotas  giving  written 
consent to their increase in quota; (ii) the Amendment concerning the new structure of the IMF Executive Board entering 
into force; (iii) the Amendment to the Articles of Agreement approved under IMF Board of Governors Resolution No 63-
2 entering into force 
Article 80 of the Italian Constitution. 

 
 
 
 
                                                 
ECB-PUBLIC 

2 of the draft law provide for the authorisation of the Amendment ratification and its incorporation 

into Italian law. Articles 3 and 4 of the draft law authorise the Government to pay up the increase in 

Italy’s quota by requesting the Banca d’Italia to  perform this transaction. In particular, following 

the increase of the total quotas decided by the IMF Board of Governors, the draft law authorises the 

Ministry to pay up, by having recourse to the Banca d’Italia, the proposed increase in Italy’s IMF 

quota  from  SDR  7  882.3  million  to  SDR  15  070  million.  Article  5  of  the  draft  law  refers  to  an 
agreement  between  the  Ministry  and  the  Banca  d’Italia4  on  their  relationship  in  connection  with 

Italy’s participation in the IMF. Article 6 provides for the necessary means to cover the expenses 

deriving from the payment. 

2. 

General observations  

2.1  Article 4 of the draft law authorises the Ministry to pay the increase in the quota, by requesting the 

Banca d’Italia to perform this transaction. The ECB notes that the wording of this Article changed 

during  the  course  of  the  parliamentary  procedure  to  include  an  obligation  for  the  Ministry  to 

provide guarantees to the Banca d’Italia covering any risk connected to the payments to the IMF 

that the Banca d’Italia carries out on behalf of the Italian Government regarding the quota increase. 

The  ECB  understands  that  the  new  wording  is  meant  to  protect  the  Banca  d’Italia  from  any  risk 

connected to such payments. 

2.2  Several  ECB  Opinions5  have  noted  that  the  tasks  performed  by  a  national  central  bank  must 

comply  with  the  monetary  financing  prohibition  under  Article  123  of  the  Treaty  and  Council 

Regulation (EC) No 3603/93 of 13 December 1993 specifying definitions for the application of the 
prohibitions  referred  to  in  Articles  104  and  104b(1)  of  the  Treaty6.  Pursuant  to  Article  7  of 

Regulation  (EC)  No  3603/93,  the  financing  by  national  central  banks  of  obligations  falling  upon 

the public sector vis-à-vis the IMF is not regarded as a credit facility within the meaning of Article 

123 of the Treaty. Therefore, the ECB notes that any possible payment by the Banca d’Italia of the 

proposed increase in Italy’s IMF quota complies with Article 7 of Regulation (EC) No 3603/93 and 

does not infringe the monetary financing prohibition. 

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

Done at Frankfurt am Main, 7 September 2011. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

4  
5  

6  

Agreement of 10 December 2007, approved and executed by Ministerial Decree No 127093 of 28 December 2008. 
See  ECB  Opinions  CON/1997/16,  CON/2005/29,  CON/2009/5,  CON/2009/33,  CON/2009/35,  CON/2009/41, 
CON/2009/100,  CON/2010/13,  CON/2010/15,  CON/2010/22,  CON/2010/40,  CON/2010/74,  CON/2011/10.  All 
Opinions are available on the ECB’s website at www.ecb.europa.eu. 
OJ L 332, 31.12.1993, p. 1. 

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