Did the European Convention have anything to say about the basic objectives and tasks of the European System of Central Banks (ESCB) and the European Central Bank (ECB)?
Article III-77 of the draft Constitution, proposed by the European Convention, corresponds with Article 105 TEC, and it is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter II ‘Economic and monetary policy’, Section 2 ‘Monetary policy’.
First, we present the proposed contents. In the draft Treaty establishing a Constitution for Europe, Article III-77 on the objectives and basic tasks of the European System of Central Banks and the European Central Bank is found in OJ 18.7.2003 C 169/42:
Article III-77 Draft Constitution
1. The primary objective of the European System of Central Banks shall be to maintain price stability. Without prejudice to this objective, the European System of Central Banks shall support the general economic policies in the Union in order to contribute to the achievement of its objectives as laid down in Article I-3. The European System of Central Banks shall act in accordance with the principle of an open market economy with free competition, favouring an efficient allocation of resources, and in compliance with the principles set out in Article III-69.
2. The basic tasks to be carried out through the European System of Central Banks shall be:
(a) to define and implement the Union's monetary policy;
(b) to conduct foreign-exchange operations consistent with Article III-228;
(c) to hold and manage the official foreign reserves of the Member States;
(d) to promote the smooth operation of payment systems.
3. Paragraph 2(c) shall be without prejudice to the holding and management by the governments of Member States of foreign-exchange working balances.
4. The European Central Bank shall be consulted:
(a) on any proposed Union act in its fields of competence;
(b) by national authorities regarding any draft legislative provision in its fields of competence, but within the limits and under the conditions set out by the Council of Ministers in accordance with the procedure laid down in Article III-79(6).
The European Central Bank may submit opinions to the Union institutions, bodies or agencies or to national authorities on matters in its fields of competence.
5. The European System of Central Banks shall contribute to the smooth conduct of policies pursued by the competent authorities relating to the prudential supervision of credit institutions and the stability of the financial system.
6. European laws may confer upon the European Central Bank specific tasks concerning policies relating to the prudential supervision of credit institutions and other financial institutions with the exception of insurance undertakings. Such laws shall be adopted after consultation of the European Central Bank.
The next post is going to look at some legal materials concerning the European Convention proposal.