Opinion of the European Central Bank of 6 April 2016 on Austria’s contribution to the Catastrophe Containment and Relief Trust of the International Monetary Fund (CON/2016/21)
Date: 2016-04-06
Institutions: European Central Bank
Subjects: Austria, International Monetary Fund, aid to disaster victims, infectious disease, natural disaster

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 6 April 2016 

on Austria’s contribution to the Catastrophe Containment and Relief Trust of the International 

Monetary Fund 

(CON/2016/21) 

Introduction and legal basis 

On 11 February 2016, the European Central Bank (ECB) received a request from the Austrian Ministry of 

Finance (MoF) for an opinion on a draft law regarding Austria’s contribution to the International Monetary 

Fund (IMF)’s Catastrophe Containment and Relief Trust (hereinafter the ‘CCR Trust’) (hereinafter 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 on the third indent of Article 2(1) of Council Decision 98/415/EC 1, 

as the draft law relates to a national central bank. 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 

In November 2014, the G-20 called upon the IMF to provide additional financial aid for the countries 

stricken by  the  Ebola epidemic. In response to this request, the IMF  extended the aid  provided by 

the  Post-Catastrophe  Debt  Relief  Trust,  which  provides  assistance  in  the  aftermath  of  natural 
disasters,  to  include  support  in  the  event  of  epidemics2.  The  IMF  has  combined  these  funds  to 

create  the  CCR  Trust,  which  will  enable  low-income  countries  that  have  been  affected  by  natural 

disasters  or  epidemics  to  be  able  to  reduce  their  IMF  debt  by  20%  of  their  quota  (or  more  in 

exceptional  cases).  This  reduction  will  be  implemented  by  decreasing  the  number  of  their  debt 

instalments due until that amount is reached. As regards the three Ebola-stricken countries, Liberia, 

Guinea and Sierra Leone, the IMF will write off USD 100 million of debt. 

1.2  Generally,  the  CCR  Trust  resources  are  sufficient  to  provide  support  to  the  countries  currently 

affected  by  the  Ebola  epidemic.  However,  additional  resources  amounting  to  approximately 

USD 150  million  will  be  required  to  respond  to  similar  cases  in  the  future.  The  IMF  therefore 

appealed  to  its  members  to  help  with  funding  this  amount.  As  regards  Austria,  the  IMF  requested 

that the Oesterreichische Nationalbank (OeNB) provide support amounting to USD 3 to 5 million. 

1.3  The draft law authorises the OeNB to transfer EUR 2.7 million from its own resources on behalf of 

1  

2  

Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank by national authorities 
regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42). 
See IMF Press Release No 15/34, 5 February 2015. 

 
 
 
 
                                                 
ECB-PUBLIC 

Austria to the CCR Trust. According to the explanatory memorandum accompanying the draft law, 

the  OeNB’s  contribution  is  to  be  considered  a  donation  in  order  for  the  OeNB  to  avoid  repayment 

claims against the IMF or third parties. As a result of this contribution, the OeNB will experience an 

annual loss of interest amounting to EUR 1,350, which would have been received by the OeNB at an 
interest  rate  of  0.05  %  on  the  amount  transferred  to  the  CCR  Trust3.  This  loss  will  reduce  the 

OeNB’s annual income, resulting in a marginally lower profit distribution to the MoF. 

2. 

Monetary financing prohibition 

2.1  The tasks performed by a national central bank must comply with the monetary financing prohibition 

under  Article  123  of  the  Treaty,  which  is  subject  to  certain  exemptions  laid  down  in  Council 
Regulation  (EC)  No  3603/934.  In  particular,  Article  7  of  Regulation  (EC)  No  3603/93  provides  that 

the financing by national central banks of obligations falling upon the public sector in relation to the 

IMF are not regarded as a credit facility within the meaning of Article 123 of the Treaty. Recital 14 of 

Regulation  (EC)  No  3603/93  clarifies  the  rationale  behind  this  exemption,  stating  that  it  is 

appropriate  to  authorise  the  financing  by  the  central  banks  of  obligations  falling  upon  the  public 

sector  in  relation  to  the  IMF  because  such  financing  ‘results  in  foreign  claims  which  have  all  the 

characteristics  of  reserve  assets’.  Therefore,  the  exemption  in  Article  7  of  Regulation  (EC) 
No 3603/93 must be interpreted in line with this rationale5. 

2.2  The OeNB’s transfer of Austria’s contribution to the CCR Trust, as set out in the draft law, does not 

fall under the exemption in Article 7 of Regulation (EC) No 3603/93 because the financing does not 

result  in  claims  that  have  the  characteristics  of  reserve  assets  within  the  meaning  of  Recital  14  of 

Regulation (EU) No 3603/93. Therefore, the ECB regards the OeNB’s donation to the CCR Trust as 

a  form  of  monetary  financing  prohibited  by  Article  123(1)  of  the  Treaty.  In  order  to  avoid  such  an 

infringement  of  the  monetary  financing  prohibition,  the  OeNB  should  not  finance  the  Austrian 

contribution  to  the  CCR  Trust  from  its  own  resources,  and  the  draft  law  should  be  amended 
accordingly.6  

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

Done at Frankfurt am Main, 6 April 2016. 

[signed] 

The President of the ECB 

Mario DRAGHI 

3  
4  

5  

6  

See the simplified outcome-oriented impact assessment accompanying the draft law. 

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 Treaty (OJ L 332, 31.12.1993, p. 1). 

Consistently  with  this  interpretation,  see  Opinions  CON/2005/29  and  CON/2013/16.  With  regard  to  the  issue  of  na-
tional central banks financing of IMF quota increase, see Opinions CON/2012/65 and CON/2011/97. All ECB Opinions 
are available on the ECB’s website at www.ecb.europa.eu.  
This position departs from the one set out in Opinions CON/2010/22 and CON/2008/41. All ECB opinions are availa-
ble on the ECB website at www.ecb.europa.eu. 

2