In particular, in its supervisory activities, the ECB must apply all relevant Union law and, where the Union law is in the form of directives, the national legislation transposing those directives. [25] The ECB is also subject to binding regulatory and implementing technical standards developed by the European Banking Authority (EBA) and adopted by the Commission[26] and to the EBA’s powers to resolve disputes between competent authorities in a legally binding manner. [27] While the ECB is consulted on draft legislation within its fields of competence, the ECB is not a supervisory policymaker and its supervisory tasks, although entailing discretionary judgement, focus on the implementation and enforcement of supervisory policies and rules established by democratically accountable institutions. Even though operational independence is of importance to the http://www.ecb.europa.eu/press/key/date/2017/html/sp170330.en.html[03.04.2017 15:53:14]  Central bank independence revisited  manner in which these tasks are carried out, the fact that a supervisor is required to act in response to decisions made by, or in cooperation with, policymakers and other supervisors means that the high level of protection from external influence that is guaranteed under Article 130 of the Treaty is not appropriate for these tasks. The provisions on independence in the SSM Regulation are similar to Article 130 of the Treaty, but serve a different purpose. The personal and instrument independence are also different.

As a consequence, institutional independence should be subject to a functional analysis of the need for those new tasks to benefit  http://www.ecb.europa.eu/press/key/date/2017/html/sp170330.en.html[03.04.2017 15:53:14]  Central bank independence revisited  from the same broad independence framework. If central bank independence is to be modelled in a functional manner, then its pendant – the central bank’s accountability and disclosure requirements – also need to reflect this modelling. Accountability and transparency The principles of accountability and transparency are essential for independent central banks. Accountability is a political duty and sine qua non for the democratic legitimacy of an independent central bank that is answerable for the exercise of its decision-making powers. [18] Accountability refers to the ex post explanation and justification of autonomous decision-making. [19] Transparency is aimed at increasing the effectiveness of a central bank’s policies by communicating them in real time, or even in advance, thus facilitating the public’s understanding of the central bank’s objectives, behaviour and decisions. [20] The channels through which the ECB is held accountable for the performance of its monetary policy function are laid down at constitutional level, i.e. in the Treaty. The Treaty was concluded by the national governments and ratified by the national parliaments of the EU Member States, and in some cases endorsed by popular referenda, in accordance with national constitutional requirements. This gives the ECB, as an independent institution accountable to the EU institutions as well as to the public at large, a profound degree of democratic legitimacy.