What is Act No. 22 / 1992 Coll.?

Act No. 22 / 1992 Coll., on the State Bank of Czechoslovakia — Law on the Czechoslovak State Bank.

When it became Act No. 22 / 1992 Coll. effectiveness?

Act No. 22 / 1992 Coll. became effective 01.02.1992.

Is Act No. 22 / 1992 Coll. still valid?

Yes, Act No. 22 / 1992 Coll. is still valid and effective.

Act No. 22 / 1992 Coll. - Law on the Czechoslovak State Bank

22

THE LAW

of 20 December 1991

concerning the Czechoslovak State Bank

The Federal Assembly of the Czech and Slovak Federal Republic decided on this law:

ČÁST PRVNÍ

BASIC PROVISIONS

§ 1

(1) The Czechoslovak State Bank is the central bank of the Czech and Slovak Federal Republic.

(2) Czechoslovak State Bank is a legal entity based in Prague; is not entered in the Commercial Register.

(3) The Czechoslovak State Bank acts as a federal central body within the scope laid down by this Act and by specific laws. 1)

(4) The Czechoslovak State Bank has the status of an entrepreneur in property law relations in the management of its own assets.

§ 2

The main objective of the Czechoslovak State Bank is to ensure the stability of the Czechoslovak currency. To this end, the Czechoslovak State Bank

(a) determine monetary policy;

(b) issue banknotes and coins;

(c) manage the cash flow, coordinate payment and settlement of banks and ensure their continuity and economy;

d) oversees the conduct of banking activities and ensures the safe functioning and efficient development of the banking system in the Czech and Slovak Federal Republic;

(e) carry out other activities under this Act.

§ 3

(1) The Czechoslovak State Bank is required to report to the Federal Assembly of the Czech and Slovak Federal Republic at least twice a year on monetary developments; It also informs the Czech National Council and the Slovak National Council.

(2) The Czechoslovak State Bank is obliged to inform the public about monetary developments at least every three months.

ČÁST DRUHÁ

ORGANISATION OF THE STATE BANK

§ 4

General provisions

The State Bank of Czechoslovakia consists of:

(a) a federal headquarters based in Prague;

(b) headquarters for the Czech Republic based in Prague and headquarters for the Slovak Republic based in Bratislava;

(c) branches;

(d) special purpose organisational units.

Bank Board

§ 5

(1) The Chief Managing Authority of the Czechoslovak State Bank is the Banking Board of the Czechoslovak State Bank (hereinafter the "Banking Board"). The Bank Board determines the monetary policy and instruments for its implementation and decides on the monetary policy measures of the Czechoslovak State Bank.

(2) In particular, the Bank Board

(a) lay down the principles of the activities and transactions of the Czechoslovak State Bank and the jurisdiction of the Federal Headquarters, the Headquarters for the Czech Republic and the Headquarters for the Slovak Republic in carrying out such activities and transactions, unless provided for by this Act;

(b) approve the budget of the Czechoslovak State Bank (§ 51);

(c) establish the organisational arrangements and responsibilities of the Czechoslovak State Bank's organisational units;

(d) specify the types of funds of the Czechoslovak State Bank, their amount and their use;

(e) determine the scope of the loans referred to in Article 35 (2);

(f) determine the salary or other benefits of the Governor;

(g) agrees to the staff of the Czechoslovak State Bank in the management, supervisory and control bodies of companies and banks.

§ 6

(1) The members of the Bank Board are the Governor of the State Bank of Czechoslovakia, two Vice-Governors of the State Bank of Czechoslovakia, one of which is a citizen of the Czech Republic and the other a citizen of the Slovak Republic, and the Vice-Governor responsible for managing the headquarters of the State Bank of Czechoslovakia for the Czech Republic and his representative and the Vice-Governor responsible for managing the headquarters of the State Bank of Czechoslovakia for the Slovak Republic.

(2) The Governor is appointed and recalled by the President of the Czech and Slovak Federal Republic on a proposal from the Government of the Czech and Slovak Federal Republic.

(3) Vice-governors of the Czechoslovak State Bank are appointed and dismissed by the President of the Czech and Slovak Federal Republic on a proposal from the Governor discussed with the Government of the Czech and Slovak Federal Republic.

(4) The Vice-Governor responsible for managing the headquarters of the Czechoslovak State Bank for the Czech Republic and its Deputy and Vice-Governor responsible for managing the headquarters of the Czechoslovak State Bank for the Slovak Republic and its representative is appointed and dismissed by the President of the Czech and Slovak Federal Republic on a proposal from the Governor to the Government of the relevant Republic.

(5) The managers referred to in paragraph 1 shall be appointed for a term of six years.

(6) The membership of the Bank Board is incompatible with the function of legislature and membership of the Government of the Czech and Slovak Federal Republic, the Governments of the Republics and the governing, supervisory and supervisory bodies of other banks and companies.

(7) A senior member who is a member of the Banking Board under this Act may be dismissed only if he has been convicted of a criminal offence by a final decision of the Banking Board or has ceased to be able to perform his duties or, at his own request, to the Banking Board. It shall also be withdrawn if it takes up the duties referred to in paragraph 6.

§ 7

(1) The meeting of the Banking Board shall be chaired by the Governor, the Vice-Governor in his absence. The Bank Board shall take its decisions by simple majority. The Bank Board shall be quorum if the Governor or the Vice-Governor appointed by him and at least three other members are present. In the event of a tie, the chairman shall vote.

(2) A member of the Banking Board may be represented at the hearing and voting of the Banking Board by another member of the Banking Board on the basis of written authorisation.

(3) The Rules of Procedure of the Bank Board shall be issued by the Governor.

§ 8

The Governor represents the State Bank of Czechoslovakia externally.

Federal Headquarters of the Czechoslovak Bank

§ 9

(1) The Federal Headquarters of the State Bank of the Czechoslovak Republic is preparing a meeting of the Bank Board and, within the scope of its responsibility, it is implementing a decision of the Bank Board.

(2) In particular, the Federal Headquarters of the Czechoslovak State Bank is responsible for:

(a) transactions with the Czech and Slovak Federal Republic under this Act (Sections 35 and 36);

(b) the management of foreign reserve assets in gold and foreign exchange assets, foreign exchange transactions and foreign exchange transactions;

(c) issues of securities of the Czechoslovak State Bank and transactions therein;

(d) securities transactions;

(e) the methodological management of banking supervision and, to the extent specified by the banking board, its implementation;

(f) the management of special purpose organisational units at the Federal Headquarters of the Czechoslovak Bank.

§ 10

The Federal Headquarters of the Czechoslovak Bank is run by the Governor. In his absence, he shall be represented by the Vice-Governor in charge. The advisory body of the Governor shall be the board of directors of the federal headquarters whose members shall be appointed and dismissed by the Governor.

Headquarters of the Czechoslovak State Bank for the Czech Republic and headquarters of the Czechoslovak State Bank for the Slovak Republic

§ 11

(1) The headquarters of the Czechoslovak State Bank for the Czech Republic and the headquarters of the Czechoslovak State Bank for the Slovak Republic (hereinafter referred to as the "Republic Headquarters") participate in the preparation of meetings of the Bank Board and ensure the implementation of its decisions.

(2) In particular, the Republic's headquarters are responsible for:

(a) transactions with the relevant Republic under this Act (Sections 35 and 36);

(b) transactions in banks established in the territory of the Republic concerned under this law;

(c) the conduct of banking supervision to the extent specified by the Banking Board;

(d) control of the performance of management obligations by foreign exchange agents other than banks located in the territory of the relevant Republic, which the State Bank of Czechoslovakia carries out under the special legislation.2)

(3) Republic headquarters are managed by branches and special-purpose organizational units of the Czechoslovak State Bank in the territory of the relevant Republic, with the exception of special-purpose organisational units in the federal headquarters of the Czechoslovak State Bank.

§ 12

The Vice-Governor responsible for the management of the relevant Republic Headquarters shall direct the Republic Headquarters, in the absence of his representative. The advisory body of the Vice-Governor shall be the Board of Directors of the Republic Headquarters, the members of which shall be appointed and dismissed by the Vice-Governor responsible for the management of the relevant Republic Headquarters.

§ 13

Advisory Councils

At the federal headquarters of the State Bank of Czechoslovakia and the Republic's headquarters, a group of advisers may be set up consisting of experts who are not employees of the State Bank of Czechoslovakia. The establishment of a Board of Advisers at the Federal Headquarters shall be decided by the Governor and appointed by its members; the establishment of a Board of Advisers at the Republic Headquarters shall be decided by and appointed by the Vice-Governor responsible for the management of the respective Republic Headquarters. The meetings of the Board of Advisers at the Federal Headquarters shall be chaired by the Governor or the Vice-Governor appointed by him, the Council of Advisers at the Republic Headquarters shall be chaired by the Vice-Governor responsible for the management of the respective Republic Headquarters or his representative.

ČÁST TŘETÍ

RELATIONS TO GOVERNMENTS

§ 14

(1) When securing its main objective (Section 2), the State Bank is Czechoslovak independent of the guidelines of the Government of the Czech and Slovak Federal Republic, the Government of the Czech Republic and the Government of the Slovak Republic.

(2) The meeting of the Bank Board may be attended by an advisory member of the Government of the Czech and Slovak Federative Republic, the Government of the Czech Republic or the Government of the Slovak Republic appointed by the Government.

§ 15

(1) The Czechoslovak State Bank takes an opinion on the proposals submitted to the Government of the Czech and Slovak Federal Republic, the Government of the Czech Republic or the Government of the Slovak Republic, which affect the jurisdiction of the Czechoslovak State Bank.

(2) The Czechoslovak State Bank performs advisory functions towards the Government of the Czech and Slovak Federal Republic, the Government of the Czech Republic and the Government of the Slovak Republic in matters of a monetary political nature and banking.

§ 16

The Governor of the Czechoslovak State Bank is entitled to attend the meetings of the Government of the Czech and Slovak Federal Republic and the Vice-Governor responsible for managing the relevant Republic headquarters of the Government of the Republic.

ČÁST ČTVRTÁ

EMISSIONS BANKNOTES AND MINES

§ 17

The Czechoslovak State Bank has the exclusive right to issue banknotes and coins as well as commemorative coins ("banknotes and coins').

§ 18

The money unit in the Czech and Slovak Federal Republic is the crown Czechoslovak; the abbreviation of the name is "Kčs'. The crown of Czechoslovakia is divided into a hundred pennies.

§ 19

The Czechoslovak State Bank manages the stocks of banknotes and coins and organises the supply of banknotes and coins from manufacturers in accordance with the requirements of money circulation.

§ 20

The Czechoslovak State Bank negotiates the printing of banknotes and coins and oversees the protection and security of unpublished banknotes and coins and the preservation and destruction of printing plates, ramps and invalid and discarded banknotes and coins.

§ 21

(1) Valid banknotes and coins issued by the Czechoslovak State Bank are legal money at their nominal value in all payments on the territory of the Czech and Slovak Federal Republic.

(2) Coins of precious metal, commemorative coins and coins in special design intended for collector's purposes may be sold at prices different from their nominal value.

§ 22

(1) The Czechoslovak State Bank exchanges damaged banknotes and coins it has issued for undamaged banknotes and coins upon request.

(2) The Czechoslovak State Bank may refuse to exchange banknotes or coins whose pattern or relief is illegible or perforated, and the remains of banknotes less than a quarter of the original banknote area. Such banknotes and coins shall be collected without refund and destroyed by the sender; in justified cases, the State Bank of Czechoslovakia may exceptionally grant compensation.

(3) The Czechoslovak State Bank does not provide compensation for banknotes and coins that have been destroyed or lost. Banknotes whose appearance has been altered, in particular banknotes that have been described, painted, reprinted, printed, perforated or covered with paint, adhesive or other similar material, may be withdrawn without refund.

§ 23

Circulation-worn banknotes and coins The Czechoslovak State Bank is withdrawing, destroying and replacing them with new banknotes and coins.

§ 24

(1) The Czechoslovak State Bank may declare invalid and withdraw the banknotes and coins it has issued. They shall pay their nominal value in exchange for other newly issued banknotes and coins. The period during which the exchange may be made shall not be less than five years.

(2) At the end of the period fixed for the exchange, the aggregate amount of banknotes and coins declared invalid but not submitted for exchange shall be deducted from the amount of money in circulation in the Czechoslovak State Bank accounts. This amount is the income of the Czechoslovak State Bank.

§ 25

Any reproduction of banknotes, coins, cheques, securities or payment cards denominated in Czechoslovak crowns or foreign currency (hereinafter referred to as "money symbols') or objects by modification may be made only under the conditions laid down in the implementing regulation.

§ 26

Counterfeit banknotes and coins denominated in Czechoslovak crowns or foreign currency shall be taken by legal persons against confirmation without compensation and transmitted to the Czechoslovak State Bank. Legal persons shall be entitled to require the person who has submitted counterfeit banknotes or coins to prove his identity in a credible manner. The removal of counterfeit banknotes and coins shall be notified by the legal person who removed the counterfeit to the law enforcement authorities.

§ 27

The Czechoslovak State Bank provides for legislation

(a) denominations, dimensions, weight, material, appearance and other features of banknotes and coins and their release into circulation;

(b) the procedure by natural and legal persons for receiving and handling legal money, including the procedure for finding that banknotes and coins are falsified or altered, or where such suspicion arises;

(c) the provision of compensation for incomplete and damaged banknotes and coins;

(d) the expiry of banknotes and coins and the manner and time of their exchange for other banknotes and coins;

(e) the conditions under which the reproduction of symbols of money or objects imitating them may be produced.

ČÁST PÁTÁ

INSTRUMENTS FOR THE MONETARY REGULATION OF THE STATE BANK

§ 28

(1) The Czechoslovak State Bank sets out the interest rates, frameworks, maturity and other conditions of the transactions it carries out under this Act.

(2) The Czechoslovak State Bank may set minimum interest rates on deposits received by banks and branches of foreign banks (hereinafter referred to as "banks') and maximum interest rates on loans granted by them. These rates are announced by measures (m3) in the Collection of Laws.

(3) The Czechoslovak State Bank may determine the maximum amount of loans granted by them.

§ 29

The Czechoslovak State Bank sets out and declares in accordance with the special legislation4) rules on liquidity, capital equipment and other rules on prudent business of banks.

§ 30

(1) The Czechoslovak State Bank may require banks to have a specified portion of their resources deposited in their accounts with the Czechoslovak State Bank (hereinafter referred to as the "compulsory minimum reserves"), which are not normally remunerated.

(2) Mandatory minimum reserves may amount to no more than 30% of the total liabilities of the bank reduced by the bank's liabilities towards other banks, except in the cases referred to in paragraph 3.

(3) In order to limit excess liquidity and overcome inflationary pressures, the State Bank of Czechoslovakia is entitled to require compulsory minimum reserves to an extent higher than that defined in paragraph 2; in this case, they are remunerated at the discount rate in force to an extent exceeding that defined in paragraph 2.

§ 31

(1) If the bank does not maintain the required minimum reserve, the Czechoslovak State Bank shall be entitled to charge interest equivalent to up to three times the applicable discount rate on the amount by which the fixed minimum reserve is not filled.

(2) When increasing the level of reserve requirements, the State Bank shall determine the Czechoslovak deadline by which the Bank must cope with the increase.

ČÁST ŠESTÁ

BUSINESS OF THE STATE BANK

Business with banks

§ 32

The Czechoslovak State Bank maintains banks' accounts and receives their deposits.

§ 33

The Czechoslovak State Bank can buy or sell to banks

(a) notes due within six months of the date of purchase by the Czechoslovak State Bank and bearing at least two signatures, of which at least one signature per bank;

(b) government bonds or other securities with a State guarantee, due within one year of their purchase by the Czechoslovak State Bank.

§ 34

(1) The Czechoslovak State Bank may grant to banks, for a maximum period of three months, a loan secured by the securities referred to in § 33 or, where applicable, by sovereign bonds or other securities with a State guarantee with a maturity longer than that specified in § 33 (b), or by stock certificates for bulk goods fully insured against loss and damage, as well as other property values.

(2) In order to maintain the Bank's liquidity, the Czechoslovak State Bank may exceptionally grant a short-term loan to the Bank for a maximum period of three months.

Business with the Czech and Slovak Federal Republic, the Czech Republic and the Slovak Republic

§ 35

(1) The Czechoslovak State Bank maintains the revenue and expenditure accounts of the State Budget of the Federation, the State Budget of the Republics, the State Funds and the State Financial Assets and Liabilities, unless the competent Ministry of Finance has agreed to keep those accounts with another bank. Payments from expenditure accounts shall be made up to the amount of the aggregate balance on revenue accounts. The aggregate balance cannot be overdrawn.

(2) According to the decision of the Banking Council, the State Bank of Czechoslovakia can grant a short-term loan to the Czech and Slovak Federal Republic, the Czech Republic and the Slovak Republic by purchasing Treasury bills payable within three months of their purchase to cover fluctuations in the management of state budgets during the year. The total state of these loans must not exceed 5% of the revenue of the budget concerned in the previous year.

§ 36

The Czechoslovak State Bank places on sale according to the special legislation5) state bonds and, in agreement with the Federal Ministry of Finance, the Ministry of Finance of the Czech Republic or the Ministry of Finance of the Slovak Republic, can also, under their authority and for the agreed remuneration, carry out activities related to the administration and repayment and transfer of government bonds, with the payment of interest on those bonds or other required activities.

Other transactions of the Czechoslovak State Bank

§ 37

The Czechoslovak State Bank can buy and sell marketable securities to guide the money market.

§ 38

The Czechoslovak State Bank may issue and trade short-term securities with a maturity of up to six months.

§ 39

(1) The Czechoslovak State Bank may maintain the accounts of its employees and provide them with additional banking services. This activity may exceptionally also be carried out for legal persons.

(2) Specific law 4) applies mutatis mutandis to the implementation of the activities referred to in paragraph 1.

ČÁST SEDMÁ

POWER OF THE STATE BANK OF THE CZECH ECONOMY

§ 40

Czechoslovak State Bank

(a) declares the course of the Czechoslovak currency for foreign currencies;

(b) determine the price of gold in the banking operations of the Czechoslovak State Bank;

(c) keep and manage the currency reserves in and with gold and foreign exchange funds.

§ 41

Czechoslovak State Bank

(a) trade in gold and other foreign exchange values and conduct all types of banking transactions with domestic and foreign banks;

b) determines the conditions for the rectifying of the balance of payments of the Czech and Slovak Federal Republic and announces measures (m3) in the Collection of Laws;

(c) determine the conditions for trade in gold and other foreign exchange values carried out by banks and other persons under the special legislation2) and proclaims the measure m3) in the Collection of Laws;

(d) issue securities denominated in foreign currency.

ČÁST OSMÁ

OTHER ACTIVITIES AND AUTHORISATIONS OF THE STATE BANK

§ 42

(1) The Czechoslovak State Bank submits to the Government of the Czech and Slovak Federal Republic proposals for legal adjustments in the field of currency and money circulation.

(2) The Czechoslovak State Bank, together with the Federal Ministry of Finance, presents to the Government of the Czech and Slovak Federal Republic draft legal amendments to the foreign exchange economy and draft legal amendments to banking.

§ 43

(1) The Czechoslovak State Bank manages the cash flow and may, to that end, provide for legal provisions in cases where cash cannot be paid.

(2) In order to ensure uniform payment and settlement in the Czech and Slovak Federal Republic, the Czechoslovak State Bank provides for a legal provision

(a) the principles of payment between banks and settlement of accounts with banks;

(b) the use of means of payment used by banks in payment transactions.

§ 44

The Czechoslovak State Bank carries out registration of the representation of foreign banks and financial institutions (hereinafter referred to as the "representation") operating in the territory of the Czech and Slovak Federal Republic. A foreign bank or financial institution shall be required to register a representative before its commencement.

§ 45

The Czechoslovak State Bank, within the scope of its jurisdiction under this Act, negotiates payment and other agreements with foreign banks and international financial institutions.

§ 46

(1) The Czechoslovak State Bank coordinates the development of the banking information system in the Czech and Slovak Federal Republic. To this end, it lays down the principles of the banking information system.

(2) The Czechoslovak State Bank is entitled to require the necessary information and documentation from the bank4) and from other persons to whom it has granted authorisation under a special law. To this end, the Czechoslovak State Bank sets out, in accordance with the Special Act (6), measures (m3) published in the Collection of Laws, the methodology and conditions for submitting the required information and supporting documents, defining in particular the content, form, breakdown, deadlines and method of transmission of information and supporting documents. If the information and supporting documents submitted do not comply with the established methodology and conditions, or if reasonable doubts arise as to their accuracy or completeness, the State Bank of Czechoslovakia shall be entitled to request appropriate clarification or clarification. If a bank or other person authorised under a special law fails to submit the information and supporting documents requested or the information and supporting documents are repeatedly incomplete or incorrect, the bank shall be treated in accordance with the special law, 4) with respect to other persons under Paragraph 50.

Date of Promulgation	20.01.1992
Effective from	01.02.1992
Effective until	-
Status	Valid

Citation	Act No. 22 / 1992 Coll., on the State Bank of Czechoslovakia
Regulation Type	-
Author	-
Collection	Code of Laws

Act No. 22 / 1992 Coll.

Law on the Czechoslovak State Bank

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