Opinion of the European Central Bank of 21 July 2020 on the amendment of the appointment criteria of Banco de Portugal's Governor and other members of the Management Board (CON/2020/19)
Date: 2020-07-21
Institutions: European Central Bank
Subjects: legal basis

EN  

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 21 July 2020 

on the amendment of the appointment criteria of Banco de Portugal's Governor and other 

members of the Management Board 

(CON/2020/19) 

Introduction and legal basis 

On 18 June 2020, the European Central Bank (ECB) received a request from the Portuguese Assembly 

of the Republic for an opinion  on  a draft law  amending the criteria for the  appointment of the Governor 

and other members of the Management Board of Banco de Portugal (‘BdP’) (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 third indent of Article 2(1) of Council Decision 98/415/EC1, as 

the  draft  law  relates  to  the  BdP.  In  accordance  with  the  first  sentence  of  Article 17.5  of  the  Rules  of 

Procedure of the ECB, the Governing Council has adopted this opinion.  

1. 

Purpose of the draft law 

1.1  According to the explanatory memorandum accompanying the draft law, the two main objectives of 

the draft law are to reinforce the powers of the Assembly of the Republic and prevent conflicts of 

interest  by  amending  the  criteria  for  appointing  the  Governor  and  other  members  of  the  BdP’s 

Management Board. This will guarantee an adequate level of independence of  the BdP,  which  in 

turn  will  enable  it  to  resist  pressures  both  from  supervised  entities  and  from  the  Government, 

according to the explanatory memorandum. In particular, the draft law seeks to amend Article 27 of 

the  BdP’s  Organic  Law  on  the  appointment  criteria  of  the  Governor  and  other  members  of  the 

BdP’s Management Board. 

1.2  Currently, the Governor is appointed by the Ministerial Council on a proposal from the Minister for 

Finance,  after  consulting 

the  competent  commission  of 

the  Parliament  (hereinafter 

the 

‘Parliamentary Commission’). The other members of the BdP’s Management Board are appointed 

by  the  Ministerial  Council  on  a  proposal  from  the  Governor,  after  consulting  the  Parliamentary 

Commission. In making its decision on an appointment, the Government is not bound by the report 
produced by the Parliamentary Commission2.  

1.3  The draft law introduces new incompatibility rules for the appointment of the BdP’s Governor and 
the  other  members  of  the  BdP’s  Management  Board3.  According  to  the  draft  law,  the  following 

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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). 

Article 27(1) of the BdP’s Organic Law. 
Article 27(3) of the BdP’s Organic Law, as amended by the draft law. 

 
 
 
 
 
                                                 
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persons  may  not  be  appointed  as  Governor  or  as  members  of  the  BdP’s  Management  Board: 
(a) office-holders in Órgãos de Soberania (sovereign bodies) 4, as well as in autonomous regional 

governments  and  local  governments;  (b) persons  who,  in  the  five  years  preceding  appointment, 

have held the position of Prime Minister or have held a position as a member of the Government 

that is responsible for the area of finance or have held the position of Secretary of State in areas 

related to finance; (c) persons who, in the five years preceding appointment, have been members 

of  corporate  bodies,  or  who  have  performed  any  activities  or  provided  services,  remunerated  or 

not, in entities subject to the supervision of the BdP or in whose supervision the BdP participates 

within the SSM, as well as in groups of companies controlled by such entities; (d) persons who, in 

the five  years preceding  appointment, have been members of the corporate bodies,  or  who have 

performed  any  activities  or  provided  services,  whether  paid  or  not,  in  audit  or  consultancy 

companies that provide or have provided support to the BdP in the relevant period of five years or 

at  the  time  of  appointment;  and  (e)  persons  who,  at  the  time  of  appointment,  occupy  or  exercise 

other positions or functions that may affect their independence or conflict with the interests of the 

BdP. 

1.4  Under the draft law, the Governor and the other members of the BdP’s Management Board must 

be  appointed  from  among  persons  of  recognised  standing,  aptitude,  professional  experience, 

management  capability,  knowledge  and  relevant  and  appropriate  technical  competence  for  the 
exercise of their respective functions 5. The criterion ‘aptitude’ is introduced by the draft law. 

1.5  The intervention of the  Parliamentary  Commission is  given a  binding  nature. Under the draft  law, 

prior  to  an  appointment  of  an  individual  to  the  position  of  Governor  or  to  the  BdP’s  Management 

Board,  the  Parliamentary  Commission  must  provide  a  positive  opinion  as  to  the  suitability  of  the 
person  in  question  for  that  position 6.  In  addition,  with  the  aim  of  enhancing  transparency,  the 

conclusions of that opinion will be published in the Official Journal along with the resolution of the 
Ministerial  Council  designating  the  members  of  the  BdP’s  Management  Board  to  be  appointed 7. 

The Assembly of the Republic can request the Portuguese Minister of Finance to attend a hearing 

concerning the suitability of the persons intended for appointment to the BdP’s Management Board, 
before  the  finalisation  of  the  Parliamentary  Commission  opinion8.  Under  the  draft  law,  the 

Parliamentary Commission opinion has to be approved by a majority of two thirds of the members 
of  Parliament9,  in  order  to  reach  a  broad  political  consensus  concerning  the  appointment  of  the 

BdP’s Governor and of the other members of the BdP’s Management Board. 

1.6  Finally, the draft law changes the minimum threshold for the representation of each gender in the 
BdP’s Management Board  from 33% to 40%10, in  line  with  the Recommendation  Rec (2003) 3 of 
the Committee of Ministers of the Council of Europe and the explanatory memorandum thereto11. 

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Sovereign bodies (Órgãos de Soberania) comprise the President of the Republic, the Assembly of the Republic, the 
Central Government and the Courts, according to Article 110(1) of the Constitution of the Portuguese Republic. 

Article 27(1) of the BdP’s Organic Law, as amended by the draft law. 
Article 27(2) of the BdP’s Organic Law, as amended by the draft law. 

Article 27(6) of the BdP’s Organic Law, as amended by the draft law. 
Article 27(5) of the BdP’s Organic Law, as amended by the draft law. 

Article 27(4) of the BdP’s Organic Law, as amended by the draft law.  
Article 27(7) of the BdP’s Organic Law, as amended by the draft law. 

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2. 

Observations 

2.1  The  ECB  notes  that  the  draft  law  would  not  only  strengthen  the  involvement  of  the  Portuguese 

Parliament  in  the  new  appointment  procedure  for  the  Governor  and  other  members  of  the  BdP’s 

Management Board, but would also introduce a new set of incompatibility rules designed to prevent 

conflicts of interests in the exercise of the functions of the Governor and the other members of the 

BdP’s Management Board. In this regard, the ECB recalls that Member States are free to set the 

conditions  required  for  the  appointment  of  the  members  of  the  decision-making  bodies  of  their 
NCBs 12, provided that they do not conflict with the features of central bank independence flowing 

from the Treaties.  

2.2  The  ECB  considers  that  the  new  appointment  procedure  for  the  Governor  and  other  members  of 

the BdP’s Management Board does not conflict with the requirement of central bank independence 

as  laid  down  in  Article  130  of  the  Treaty  and  Article  7  of  the  Statute  of  the  European  System  of 

Central Banks and of the European Central Bank. In this context, the ECB considers that the fifth 

criterion, as set out in point (e) of paragraph 1.3 above, preventing the appointment as Governor or 

members of the BdP’s Management Board of persons who, at the time of appointment, occupy or 

exercise other positions or functions that may affect their independence or conflict with the interests 

of the BdP, is rather vague and would benefit from further clarification.  

2.3  Similarly,  the  ECB  notes  that  the  criterion  of  ‘aptitude’,  introduced  by  the  draft  law  amongst  the 

criteria  to  be  taken  into  account  for  the  appointment  of  the  the  BdP’s  Governor  and  of  the  other 

members of the BdP’s Management Board, is also rather vague and therefore might be difficult to 
interpret and use in practice13. 

2.4  The ECB notes that, should the provisions of the draft law become subject to further amendments 

in  the  course  of  the  parliamentary  process,  and  should  these  amendments  substantially  alter  the 

draft law compared to the version on which the ECB was consulted, then the ECB would need to 
be re-consulted on these amendments14.  

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

Done at Frankfurt am Main, 21 July 2020. 

[signed] 

The President of the ECB 

Christine LAGARDE 

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Available on the Council of Europe’s website at www.coe.int. 

See Opinion CON/2009/13, paragraph 3.4; Opinion CON/2015/28, paragraph 2. All ECB opinions are published on 
the EUR-Lex website at https://eur-lex.europa.eu/browse/institutions/bank.html. 

See Opinion CON/2019/19, paragraph 2.3. 
See, for example, Opinion CON2006/32, paragraph 4.1; Opinion CON/2015/28, paragraph 3.4. 

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