The digital euro as a governance tool: Institutional implications for the European central bank?

Abstract

On 28 June 2023, the European Commission published a legislative proposal for a regulation establishing the Digital Euro—the EU’s prospective retail Central Bank Digital Currency (CBDC). From a normative perspective, this legislative initiative must both reflect the EU’s exclusive competence in monetary policy and, connected to it, remain consistent with the powers conferred on the European Central Bank (ECB) by the Treaties. At the same time, the legal framework of the Digital Euro must be designed in a way not to compromise the constitutional principles of ECB independence and accountability, as captured by the so-called model of “accountable independence.”
This Article examines how future legislation should be framed to empower the ECB to issue the Digital Euro as a monetary instrument in pursuit of its statutory mandate and tasks, while ensuring an appropriate equilibrium between institutional independence and its accountability obligations. To this end, it focuses on three key legal provisions of the draft Regulation — namely, Articles 15, 16, and 40 — examining their implications in light of the existing legal framework governing the European Monetary Union.
The Article ultimately proposes targeted amendments to the Digital Euro Regulation to safeguard the constitutional foundations of the single currency and to preserve the European Central Bank’s independence and institutional role within the Union.

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ORCID for Francisco Jose Ciancetta: orcid.org/0000-0003-0545-9163

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