Opinion of the European Central Bank of 23 March 2021 on the creation of a transparency framework for contracts and related documents involving the use of public funds (CON/2021/13)
Date: 2021-03-23
Institutions: European Central Bank
Subjects: banking supervision

EN  

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 23 March 2021 

on the creation of a transparency framework for contracts  

and related documents involving the use of public funds 

(CON/2021/13) 

Introduction and legal basis 

On 5 February 2021, the European Central Bank (ECB) received a request from the Portuguese Assembly 

of  the  Republic  for  an  opinion  on  two  draft  laws  creating  a  transparency  framework  for  contracts  and 

related documents involving the use of public funds (hereinafter the ‘draft laws’)1. 

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 Article 2(1) of Council Decision 98/415/EC2, as the draft laws relate 

to  the  specific  tasks  conferred  upon  the  ECB  concerning  the  prudential  supervision  of  credit  institutions 

under  Article  127(6)  of  the  Treaty.  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 laws 

1.1  According  to  the  explanatory  memoranda  accompanying  the  draft  laws,  their  main  objective  is  to 

reinforce  the  transparency  and  scrutiny  of  operations  which  involve  the  use  of  public  funds  by 

allowing  the  Assembly  of  the  Republic  to  declassify  certain  contracts  originally  classified  as 

confidential concluded by the State or other public entities which involve the use of public funds in 

several  sectors  if  they  are  subject  to  confidentiality  safeguards.  The  purpose  is  to  increase 

transparency  and  allow  these  documents  to  be  publicly  available  given  their  impact  on  public 

finances. 

1.2  Both  draft  laws  apply  to  contracts  and  agreements  concluded  by  the  State,  or  by  any  entities 

included  within  the  scope  of  the  State  Budget,  which  involve  the  use  of  public  funds  in  specific 

economic  sectors,  including  the  banking  and  financial  sector.  One  of  the  draft  laws  expressly 

mentions  that  all  operations  involving  the  use  of  public  funds  in  the  context  of  the  application  of 

resolution  measures,  nationalisation,  liquidation  or  capitalisation  are  included  within  this  scope  of 

application. 

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2  

Projecto de Lei n.º 606/XIV/2ª – Aprova o regime jurídico da desclassificação de contratos ou outros documentos que 
comprometem o Estado ou outras entidades integradas no perímetro orçamental em sectores fundamentais; Projecto 
de  Lei  n.º  634/XIV/2ª  –  Aprova  um  regime  jurídico  de  transparência  dos  contratos,  acordos  e  outros  documentos 
relativos a operações que determinem a utilização ou disponibilização de fundos públicos relativamente a entidades 
pertencentes a sectores estratégicos. 
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). 

 
 
 
 
 
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1.3 

According  to  the  draft  laws,  the  Assembly  of  the  Republic  will  be  authorised  to  declassify  such 

contracts  stating  the  reasons  for  the  declassification  and  weighing  the  reasons  that  justify 

confidentiality against taxpayer’s right of information. 

1.4 

Under  both  draft  laws  not  only  the  contracts  themselves,  but  also  all  documents  and  information 

considered  to  be  connected  or  related  to  such  contracts,  are  subject  to  the  declassification 

decision  by  the  Assembly  of  the  Republic.  Furthermore,  the  disclosure  might  also  include  the 

names of entities or individuals who have originated losses at the entity that is the beneficiary of 

public funds. 

1.5 

Non-compliance  with  the  obligation  to  disclose  after  a  decision  to  declassify  is  adopted  by  the 

Assembly of the Republic shall be subject to criminal liability. 

1.6 

Both draft laws provide that they will prevail over any other legal framework providing for banking 

or commercial confidentiality safeguards. 

1.7 

Finally,  both  draft  laws  expressly  provide  that  they  are  to  be  applied  not  only  to  new  contracts 

concluded by the State, or by the other public entities included within their scope of application, but 

also to all pre-existing contracts which have involved the use of public funds. One of the draft laws 

establishes a limitation for contracts which have been concluded more than 14 years ago, which 

would remain out of the scope of application of that draft law. 

2. 

Observations 

2.1 

National  legislation  should  be  compatible  with  the  obligation  to  maintain  professional  secrecy  in 

respect of confidential prudential supervisory information under Union law, in particular Article 53 of 

Directive  2013/36/EU  of  the  European  Parliament  and  of  the  Council3.  Disclosure  of  such 

confidential  information  can  only  be  permitted  in  the  cases  specified  in  Article  53(1)  of  Directive 

2013/36/EU. 

2.2 

The ECB takes particular note that Banco de Portugal (‘BdP’), as the national competent authority 

responsible  for  the  prudential  supervision  of  credit  institutions,  is  not  included  among  the  public 

entities  to  which  the  draft  laws  apply.  However,  while  contracts  concluded  by  the  BdP  as  such 

would  not  be  subject  to  public  disclosure,  contracts  concluded  with  credit  institutions  by  other 

public  authorities,  such  as  the  Portuguese  Resolution  Fund,  are  included  within  the  scope  of 

application  of  the  draft  laws,  as  well  as  any  contracts  concluded  between  credit  institutions  and 

other  public entities  involving  the  use  of  public  funds.  In  addition,  both  draft  laws  provide  that  all 

documents  and  information  considered  to  be  connected  or  related  to  such  contracts  are  also 

subject to public disclosure. This means that these other documents and information, even if they 

do not form part of the contract itself, can still be subject to declassification and public disclosure.  

2.3 

The  ECB  understands  that,  because  the  BdP  would  not  be  subject  to  the  draft  laws,  such 

documents or information would not include prudential supervisory documents in the possession of 

the  authorities  responsible  for  the  prudential  supervision  of  credit  institutions,  including  the  BdP 

and the ECB, even if those documents were related to contracts within the scope of application of 

3  

Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit 
institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC 
and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338). 

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the  draft  laws.  Any  prudential  supervisory  documents  and  information  would  remain  subject  to 

confidentiality protections, as both the BdP and the ECB are – and will remain – outside the scope 

of the draft laws. Moreover, the documents or information to be disclosed under the draft laws due 

to their connection to the contracts involving the use of public funds, even if they are not formally 

prudential supervisory documents, could not include confidential supervisory information, since the 

public  disclosure  of  such  documents  or  information  would  clearly  undermine  the  professional 

secrecy protected by Article 53 of Directive 2013/36/EU. Therefore, the public disclosure of such 

documents  or  information  would  inevitably  contravene  Article  53  of  Directive  2013/36/EU.  Any 

confidential  supervisory  information  contained  in  such  documents  would  therefore  have  to  be 

redacted. 

2.4 

Both  draft  laws  exclude  from  their  scope  of  application  other  special  frameworks,  which  remain 

applicable. One of the draft laws also excludes matters subject to State or judicial secrecy, which 

are not subject to declassification under the draft laws. However, both draft laws explicitly state that 

they  prevail  over  any  other  legal  framework  providing  for  banking  or  commercial  confidentiality 

safeguards. In order to establish a framework which safeguards both confidential information and 

the legitimate interest of the public in accessing the information, as well as the primacy of Union 

law over national law, the ECB understands that it would not be possible to declassify confidential 

supervisory documents and information under the draft laws, as such an interpretation would not 

be  compatible  with  the  protection  of  confidential  supervisory  information  under  Directive 

2013/36/EU. 

2.5 

Regarding  the  provisions  for  the  disclosure  of  operations  involving  the  use  of  public  funds  in  the 

context of resolution, Directive 2014/59/EU of the European Parliament and of the Council4 confers 

powers  not  only  on  resolution  authorities  but  also  on  competent  supervisory  authorities.  Notably, 

Directive  2014/59/EU  contains  the  only  legal  basis  for  the  competent  supervisory  authorities’ 

powers  in  relation  to  recovery  planning  and  early  intervention  measures5,  with  respect  to  which 

competent  supervisory  authorities  have  a  leading  role.  Both  of  these  powers  relate  to  prudential 

supervisory tasks, as recognised in Council Regulation (EU) No 1024/20136. In addition, while not 

in the lead, competent supervisory authorities are consulted by resolution authorities or cooperate 

with  them  in  several  other  processes.  In  this  regard,  the  ECB  would  like  to  recall  that  Directive 

2014/59/EU also establishes confidentiality obligations as a necessary counterpart reinforcing the 

professional secrecy obligations in Directive 2013/36/EU. With regard to all the processes where 

competent  authorities  intervene  (whether  led  by  the  competent  supervisory  authorities  or  by  the 

resolution  authorities)  competent  supervisory  authorities  have  various  obligations  to  disclose 

confidential  supervisory  information  to  resolution  authorities  (and  in  some  cases  to  some  other 

authorities  mentioned).  On  their  part,  resolution  authorities  have  even  broader  duties  to  disclose 

confidential  information  to  other  authorities.  In  particular,  the  ECB  notes  that  the  scope  of  the 

4  

5  
6  

Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the 
recovery  and  resolution  of  credit  institutions  and  investment  firms  and  amending  Council  Directive  82/891/EEC,  and 
Directives  2001/24/EC,  2002/47/EC,  2004/25/EC,  2005/56/EC,  2007/36/EC,  2011/35/EU,  2012/30/EU  and 
2013/36/EU,  and  Regulations  (EU)  No  1093/2010  and  (EU)  No  648/2012,  of  the  European  Parliament  and  of  the 
Council (OJ L 173, 12.6.2014, p. 190). 

See Articles 5 to 9 and 27 to 30 of Directive 2014/59/EU. 

See  Article  4(1)(i)  of  Council  Regulation  (EU)  No  1024/2013  of  15  October  2013  conferring  specific  tasks  on  the 
European  Central  Bank  concerning  policies  relating  to  the  prudential  supervision  of  credit  institutions  (OJ  L  287, 
29.10.2013, p. 63). 

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confidentiality obligation of Article 84 of Directive 2014/59/EU applies to resolution authorities and 

other  public  institutions  and  private  individuals,  such  as  ministries,  deposit  guarantee  funds  or 

acquirers participating in competitive processes, some of which would potentially be compelled to 

disclose  information  under  the  draft  laws.  Since  the  competent  supervisory  authorities  are  an 

important  source  of  information  for  resolution  authorities,  which  only  collect  information  directly 

from  credit  institutions  to  the  extent  that  it  is  not  yet  available  at  the  competent  authorities,  in 

various  situations  resolution  authorities  may  be  required  to  disclose  onward  to  another  authority 

confidential information collected by and received from the competent supervisory authority. From 

a  prudential  supervisory  perspective,  care  must  be  taken  to  ensure  that  the  public  disclosure  of 

such  documents  or  information,  in  potential  contravention  of  Article  84  of  Directive  2014/59/EU, 

does  not  also  lead  to  the  disclosure  of  confidential  supervisory  information  in  breach  of  the 

professional secrecy protected by Article 53 of Directive 2013/36/EU. Any confidential supervisory 

information contained in such documents would therefore have to be redacted. 

2.6 

According  to  the  draft  laws,  the  declassification  decision  by  the  Assembly  of  the  Republic  might 

also include the disclosure of the names of entities or individuals who have originated losses at an 

entity that is a beneficiary of public funds. One of the draft laws also adds that the identification of 

shareholders and members of the management body of entities who have originated those losses 

would also be subject to such disclosure. Such information may constitute confidential supervisory 

information  which  must  remain  subject  to  professional  secrecy  requirements  in  order  to  comply 

with the confidentiality rules established in Directive 2013/36/EU.  

2.7 

Finally,  it  is  important  to  consider  that  any  unintended  disclosure  of  confidential  supervisory 

information  which  might  be  facilitated  under  the  draft  laws  could  also  have  a  negative  impact  on 

the possibility for prudential supervisory authorities to exchange information with other authorities, 

by  limiting  the  amount  of  information  that  supervisory  authorities  can  disclose  to  other  entities. 

According to Articles 56, 57 and 59 of Directive 2013/36/EU, the competent supervisory authority 

can  exchange  information  with  other  authorities,  such  as  national  market  authorities,  oversight 

bodies  and  the  central  government.  In  all  of  these  cases,  the  exchange  of  information  can  only 

occur  if  the  information  disclosed  is  subject  to  secrecy  requirements  at  least  equivalent  to  those 

referred to in Article 53 of Directive 2013/36/EU. This means that if the information in question to 

be  shared  by  the  competent  supervisory  authority  is  considered  to  be  connected  or  related  to  a 

contract  that  could  be  made  public  according  to  the  draft  laws,  then  the  competent  supervisory 

authority  could  no  longer  disclose  such  information  to  the  entities  referred  to  in  Directive 

2013/36/EU. Currently, in the absence of the draft laws, such information could be exchanged.  

This opinion will be published on EUR-Lex. 

Done at Frankfurt am Main, 23 March 2021. 

[signed] 

The President of the ECB 

Christine LAGARDE 

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