Opinion of the European Central Bank of 28 December 2016 on a Belgian draft law on the oversight of payment transaction processors (CON/2016/61)
Date: 2016-12-28
Institutions: European Central Bank
Subjects: Belgium, banking supervision, central bank, disclosure of information, money, national law, payment system, provision of services

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 28 December 2016 

on a Belgian draft law on the oversight of payment transaction processors  

(CON/2016/61) 

Introduction and legal basis 

On 18 November 2016, the European Central Bank (ECB) received a request from the Governor of the 

Nationale Bank van België/Banque Nationale de Belgique (NBB), on behalf of the Minister of Finance, for 

an opinion on a draft law on the oversight of payment transaction processors (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  the  second,  third  and  fifth  indents  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  provisions 1,  since  the  draft  law  concerns  means  of  payment,  the 

NBB  and  payment  and  settlement  systems.  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 main objective of the draft law is to equip the NBB with hard-law tools in order to facilitate the 

application  of  the  oversight  policy  framework  to  systemically  important  payment  transaction 

processors.  The  preparatory  text  regarding  the  draft  law  explains  that  the  soft-law  approach 

implemented  to  date  by  the  NBB  in  this  area  has  limitations,  as  demonstrated  by  the  recent 
adoption of Regulation (EU) No 795/2014 of the European Central Bank (ECB/2014/28) 2.  

1.2.  The draft law defines the concept of ‘payment transaction processors’ as referring to any natural or 

legal person  who implements technical  processes  that are necessary and specifically intended  to 

execute  payment  transactions.  As  a  consequence,  general  support  service  providers,  including 

financial  messaging  companies,  would  be  excluded  from  the  scope  of  the  draft  law  as  their 

services  are  not  specific  to  payment  transactions.  The  draft  law  defines  payment  transactions  as 

actions  initiated  by  the  payer  or  the  payee,  which  involve  the  transfer  of  scriptural  money, 

irrespective  of  any  underlying  obligation  between  the  payer  and  the  payee,  during  the  course  of 

which the payment transaction is executed between different payment service providers, with both 

the payer’s and the payee’s payment service providers operating in Belgium. The draft law further 

excludes from its scope the processing of certain paper-based documents drawn on the payment 

OJ L 189, 3.7.1998, p. 42. 

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2     Regulation  (EU)  No  795/2014  of  the  European  Central  Bank  of  3  July  2014  on  oversight  requirements  for 

systemically important payment systems (ECB/2014/28) (OJ L 217, 23.7.2014, p. 16). 

 
 
 
 
                                                 
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service  provider  with  a  view  to  placing  scriptural  money  at  the  disposal  of  the  payee,  these 

documents  include  paper  cheques  and  paper-based  bills,  vouchers,  paper-based  traveller’s 

cheques  and  postal  money  orders.  The  draft  law  also  excludes  from  its  scope  the  processing  of 

payment transactions within a payment or securities settlement system and the processing of direct 

debit or credit transfer schemes.   

1.3.  The  draft  law  defines  a  payment  processor  that  is  considered  to  be  systemically  important  in  the 

Belgian payment transactions market as a processor providing processing services for a minimum 

of  125  million  payment  transactions  in  the  previous  calendar  year  using  a  specific  payment 

scheme,  regardless  of  whether  the  processor  has  its  registered  office  in  Belgium.  Systemically 

important  processors  are  to  be  subject  to  a  comprehensive  legal  framework,  composed  of  the 

following  building  blocks.  First,  mergers  and  acquisitions  involving  systemically  important 

processors  must  be  submitted  for  prior  authorisation  by  the  NBB,  which  may  impose  specific 

conditions on them or reject them if such mergers or acquisitions undermine the sound and prudent 

management of processors of systemic importance and the continuity and stability of payments in 

Belgium.  Second,  systemically  important  processors  must  comply  with  the  following  conditions  in 

order  to  outsource  important  operational  tasks  for  processing  payment  transactions:  (a)  the 

processor  must  obtain  prior  authorisation  from  the  NBB  for  the  outsourcing;  (b)  the  outsourcing 

must not result in the delegation by senior management of its responsibilities; (c) the outsourcing 

must not modify the relationship and obligations of the processor with or towards payment service 

providers  and  payment  schemes;  (d)  the  outsourcing  must  comply  with  the  draft  law  and  (e)  the 

outsourcing must not undermine the quality of any internal control that would prevent the NBB from 

controlling  the  compliance,  by  the  processor,  with  its  obligations.  Third,  the  draft  law  imposes 

various obligations on systemically important processors that aim to equip them with a sound risk-

management framework for comprehensively identifying sources of operational risks, both internal 

and  external,  and  minimising  their  impact  by  deploying  appropriate  controls,  systems  and 

procedures. Fourth, the draft law contains specific requirements as regards the confidentiality and 

integrity  of  information  as  well  as  the  continuous  provision  of  services.  In  particular,  systemically 

important processors must inform the NBB of any temporary unavailability of their services.   

1.4.  The draft law subjects payment transaction processors to some of the hard-law components of the 

oversight framework currently applicable to payment and securities settlement systems. To ensure 

their compliance with the above-mentioned oversight framework, processors must provide the NBB 

with  regular  information  on  their  organisation,  functioning,  financial  situation  and  operations.  The 

NBB  will have the power to conduct on-site inspections to gather additional information, and  may 

impose remedial measures in the event of breaches of the oversight framework requirements. The 

NBB’s  sanctioning  committee  may  also  impose  fines,  while  the  NBB  may,  in  extremis,  prevent 

payment schemes from using the services of a processor or prevent a processor from outsourcing 

its activities if the above-mentioned requirements are not complied with.  

1.5.  The  draft  law  also  includes  specific  requirements  applicable  to  payment  schemes  that  operate  in 

Belgium.  The  definition  of  payment  schemes  under  the  draft  law  is  drawn  from  Regulation  (EU) 

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(No)  260/2012  of  the  European  Parliament  and  of  the  Council3  and  Regulation  (EU)  2015/751  of 
the  European  Parliament  and  of  the  Council4  and  refers  to  ‘a  single  set  of  rules,  practices, 

standards and/or guidelines, operating in Belgium, agreed between the payment service providers 

for  the  execution  of  payment  transactions,  which  is  separate  from  any  infrastructure  or  payment 

system  that  supports  its  operation  and  which  comprises  a  specific  decision-making  body, 

organisation or entity responsible for the operation of the payment scheme’. The draft law requires 

the  a  payment  scheme:  (a)  to  transmit  information  on  the  payment  transaction  processor  that  it 

uses;  (b)  to  ensure  that  any  of  its  systemically  important  processors  are  able  to  comply  with  the 

requirements imposed by the draft law and (c) to provide, at the NBB’s request, information on its 

organisation,  operations  and  financial  standing  and  the  payment  transactions  it  processes.  The 

NBB  may  impose  administrative  fines  on  payment  schemes  in  breach  of  any  of  these 

requirements.  

1.6.  Taking note of the judgment of the European Court of Justice’s case T-496/11 5, the draft law also 

amends  Article  8  of  the  Organic  Statute  of  the  NBB  relating  to  the  oversight  of  payment  and 

clearing systems, in order to expressly refer to securities settlement systems that are subject to the 

NBB’s  oversight.  The  draft  law  also  formally  empowers  NBB  to  enact  regulations  in  this  field. 

Finally,  under  the  draft  law,  the  NBB  and  its  agents  may  only  be  held  civilly  liable  for  decisions 

taken regarding market infrastructures’ oversight in the event of fraud or gross negligence.  

2.   Hard-law oversight framework for systemically important payment transaction processors 

2.1.  The  draft  law  equips  the  NBB  with  hard-law  tools  to  facilitate  the  implementation  of  its  oversight 

framework, as previously extended to payment transaction  processors. Hence, the draft law does 

not confer genuinely new tasks on the NBB. 

2.2.  The  ECB  understands  that  the  draft  law  relates  to  service  providers  involved  in  the  technical 

support of the payment services chain and who do not directly fall within the ambit of any existing 

Union  legal  framework.  On  the  one  hand,  such  payment  transaction  processors  may  not  be 

assimilated  to  payment  service  providers  under  Directive  (EU)  2015/2366  of  the  European 
Parliament  and  the  Council6,  as  such  processors  facilitate  the  operational  execution  of  payment 

services  without  providing  payment  services  as  such.  On  the  other  hand,  the  draft  law  explicitly 

excludes  from  its  scope  the  treatment  of  payment  transactions  carried  out  within  a  payment  or 

securities settlement system. Finally, although under the draft law payment transaction processors 

provide  the  technical  infrastructure  supporting  the  functioning  of  a  ‘payment  scheme’  within  the 

meaning of Regulation (EU) 2015/751, they are not regarded as constituting a payment scheme.     

3     Regulation  (EU)  No  260/2012  of  the  European  Parliament  and  of  the  Council  of  14  March  2012  establishing 
technical  and  business  requirements  for  credit  transfers  and  direct  debits  in  euro  and  amending  Regulation  (EU) 
No 924/2009 (OJ L 94, 30.3.2012, p. 22). 

4     Regulation (EU) 2015/751 of the European Parliament and of the Council of 29 April 2015 on interchange fees for 

card-based payment transactions (OJ  L, 123, 19.5.2015, p. 123).  

5     United Kingdom of Great Britain and Northern Ireland v European Central Bank, T-496/11. ECLI:EU:T:2015:133. 
6     Directive (EU) 2015/2366  of the European  Parliament and the  Council on  payment services in the internal market, 
amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing 
Directive 2007/64/EC (OJ L 337, 23.12.2015, p. 35). 

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2.3.  Currently,  and  without  prejudice  to  initiatives  taken  at  the  domestic  level  by  some  Union  Member 
States  in  this  area 7,  payment  transaction  processors  are  only  indirectly  included  in  the  ECB’s 

oversight  framework  for  payment  schemes,  insofar  as  such  schemes  are  expected  to  ensure, 

through contractual arrangements, that the payment transaction processors used by the schemes 

respect  any  relevant  requirements,  including  operational  requirements.  The  ECB’s  oversight 

framework for  payment  schemes  assigns  a  leading  role  to  the  central  bank  that  is  best  placed  to 

fulfil the required oversight duties. Where there is no national anchor, the ECB’s Governing Council 

may assign primary oversight responsibilities to the ECB, with the participation of other interested 

Eurosystem NCBs as part of a cooperative oversight arrangement. According to this framework, the 

NBB  is  the  single  overseer  of  the  Bancontact  card  payment  scheme  and  the  lead  oversight 

authority of the MasterCard card payment scheme. The oversight of the MasterCard card payment 

scheme 

is 

implemented,  according 

to  cooperative  oversight  arrangements  enjoying 

the 

participation  of  the  ECB  and  a  number  of  volunteer  NCBs.  The  ECB  is  the  lead  overseer  of  the 

VISA payment scheme and the SEPA Credit Transfer  and Directive Debit payment schemes of the 

European Payments Council. The oversight  of other  payment schemes has been assigned to the 

respective NCBs of the Member States where the schemes are established.  

2.4.  As emphasised in the preparatory text regarding the draft law, the approach described in paragraph 

2.3  may  no  longer  be  sufficient.  This  is  because,  as  a  consequence  of  the  gradual  cross-border 

consolidation in the payment processing industry, which is not regulated as such at the European 

level, payment transaction processors may operate in a jurisdiction other than the jurisdiction where 

the payment scheme is located, without being necessarily subject to direct supervision or oversight 

in  any  jurisdiction.  As  these  processors  play  a  growing  role  in  the  build-up  of  operational  risks 

connected  to  payment  schemes,  it  is  appreciated  that  the  Belgian  legislator  wishes  to  set  up  a 

framework  intended  to  facilitate  the  monitoring  of  operational  risks  posed  by  the  gradual 

consolidation of payment transaction processors. However, the ECB considers that this framework 

needs  to  be  designed  in  a  way  that  fully  takes  into  account  the  close  interdependencies  of  these 

services with existing Union legislation, with which consistency should be ensured, and the cross-

border dimension of these services.  

2.5. 

In defining the concept of ‘payment scheme’ along the lines of the Regulations (EU) No 260/2012 

and (EU) 2015/751 and excluding the treatment of payment transactions carried out within payment 

and  securities  settlement  systems  from  the  draft  law’s  scope,  whether  they  are  of  systemic 

importance under Regulation (EU) No  795/2014 (ECB/2014/28) or not, the draft law  is sufficiently 

aligned with the definitions in current Union law.  

2.6.  The draft law has a clear cross-border impact, as it may relate to a systemically important payment 

transaction processor established  in another Member State that is  used  by  one  or more  payment 

schemes in Belgium. As a consequence, the draft law must be drafted in such a way that it avoids 

both any possible breach of Union law as regards the freedom to provide services under the Treaty 

and    any  potential  conflict  with  the  actions  of  the  authorities  in  the  Member  State  where  the 

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See the Regulation  on the oversight of the smooth operation of payment traffic (‘betalingsverkeer’) adopted by the 
Netherlands,  in  respect  of  which the  ECB  issued  its  Opinion  CON/2015/49,  all  ECB  opinions  are  published  on  the 
ECB’s website www.ecb.europa.eu .  

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payment  transaction  processor  has  its  registered  office.  The  ECB  notes,  in  this  respect,  that, 

according  to  the  preparatory  text  regarding  the  draft  law,  the  restriction  on  the  free  provision  of 

services  introduced  by  the  draft  law  is  regarded  as  being  compatible  with  the  freedom  to  provide 

services across the Union as it ensures the stability, reliability and continuity of those services that 

are essential for the proper functioning of retail payment systems.  

2.7.  Although  the  draft  law  contains  no  formal  mechanism  for  avoiding  potential  conflicts  with  the 

authorities of the Member State where the payment transaction processor has its registered office, 

the ECB assumes that the NBB will enter into a cooperative arrangement with any such authorities, 

in  order  to  coordinate  the  oversight  of  a  processor.  From  this  perspective,  the  draft  law  could 

introduce an amendment to Article 36/16 of the Organic Statute of the NBB in order to enable the 

NBB  to  enter  into  cooperative  arrangements  with  foreign  authorities  as  regards  payment 

transaction  processors.  It  is  acknowledged,  however,  that  a  cooperative  cross-border  regulatory 

approach in this area may be challenging insofar as the laws applicable in the jurisdiction in which a 

payment transaction processor is incorporated may not subject a processor to its regulatory and/or 

oversight  frameworks,  and  may  not  contain  similar  tools  and  requirements  as  those  contained  in 

the draft law.  

2.8.  Whilst  the  ECB  welcomes  the  draft  law,  which  adequately  equips  NBB  with  hard-law  tools 

facilitating  the  implementation  of  the  oversight  framework  for  payment  schemes  operated  in 

Belgium, a truly European approach would be desirable in this field, in order to avoid fragmentation 

and the possible counterproductive effects of solutions designed solely at the national level. In the 

meantime  the  ECB  assumes  that  the  NBB  will  leverage  the  existing  Eurosystem  oversight 

framework for payment schemes when considering implementing these new hard-law tools, be it as 

the  lead  overseer  of  payment  schemes  operating  in  Belgium  or  as  a  participating  NCB  in  a 

cooperative oversight arrangement for which another NCB or the ECB acts as the lead overseer.  

3.   Amendments made to the NBB Organic Law as regards its oversight framework  

The ECB welcomes the clarification that the draft law brings to Article 8 of the NBB Organic law by 

stating  that  the  oversight  of  securities  settlement  systems  is  conducted  in  Belgium  not  only  in 

accordance with the applicable Union rules, but also in accordance with the relevant Belgian laws. 

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

Done at Frankfurt am Main, 28 December 2016. 

[signed] 

The President of the ECB 

Mario DRAGHI  

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