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The European Central Bank (ECB) has recently sent Speaker of the Chamber of Deputies Liviu Dragnea a letter cautioning that the national authorities are required to consult the ECB on the legislative proposals that fall under its scope of competence, regulations on national central banks included.
The letter signed by Yves Mersch, member of the ECB Executive Board, and published on the institution's website, refers to the fact that on April 24, 2019 the Parliament of Romania, pursuant to an emergency procedure, has adopted the Law on the amendment of Article 30 of the Law on the statutes of the National Bank of Romania (BNR). The new regulatory act introduces amendments to certain provisions related to the gold reserves managed by BNR.
According to the ECB, in accordance with 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/EC, the national authorities are required to consult the ECB on draft legislative provisions concerning matters that fall within its competence, legislative provisions concerning national central banks included.
"The ECB would appreciate the Romanian authorities giving due consideration to the above observations by honoring their obligation to consult the ECB in future, in particular in the event of further legislative work in relation to the Law on the statutes of the National Bank of Romania," reads the ECB document.
On April 24 the Chamber of Deputies adopted the bill initiated by Social Democrats Liviu Dragnea and Serban Nicolae on the statutes of the National Bank of Romania, which provides for the capping of the country's foreign gold reserves at 5 percent.
According to the bill, "the National Bank of Romania, in compliance with the general rules on liquidity and risk specific to foreign assets, establishes and maintains international reserves in such a way that it can periodically determine their exact size; the reserves are set up cumulatively or selectively of several elements, including gold kept in the country's treasury."
The initiative stipulates that "from the established reserve, the National Bank of Romania may deposit gold abroad exclusively for the purpose of obtaining income through trading and other specific operations."
"The gold deposits set up by the National Bank of Romania abroad shall not exceed 5 percent of the total amount of gold kept as reserve," the act also states.
