Eurosystem

The definition and functions of the following governing bodies of the European Central Bank (ECB) are established under the Treaty on European Union (TEU), in the Statutes of the European System of Central Banks (ESCB) and their internal regulations.

The Governing Council

This is the supreme governing body of the ECB and is made up of all the members of the Executive Board and the Governors of the national central banks of the countries that have adopted the euro.

Its main responsibilities are:

• To adopt the guidelines and take the decisions necessary to ensure the performance of the tasks entrusted to the ESCB.
• To formulate monetary policy for the euro area including, as appropriate, decisions relating to monetary objectives, key interest rates, the supply of reserves in the Eurosystem, and the establishment of guidelines for the implementation of those decisions.

When making decisions on monetary policy and about other functions of the Eurosystem, the members of the Governing Council act as fully independent individuals and not as representatives of their respective countries.

The Governing Council usually meets every fortnight at the ECB headquarters in Frankfurt, although meetings may also be held by teleconference. Additionally, meetings are held twice a year in a different country of the euro area.

The Banco de España headquarters in Madrid hosted the first meeting outside Frankfurt on 30 March 2000.

The Executive Board

The Executive Board consists of the President and Vice-President of the ECB , together with four members appointed by joint agreement of the governments of the participating Member States.

Its main responsibilities are:

• To prepare Governing Council meetings.
• To implement monetary policy in accordance with the decisions made by the Governing Council and, in doing so, to give the necessary instructions to the national central banks of the Eurosystem.
• To manage the ECB's day-to-day business.
• To exercise certain powers delegated to it by the Governing Council, including some of a regulatory nature.

The Executive Board usually meets at least once a week to decide on the implementation of the monetary policy, to prepare the meetings of the Governing Council and to deal with the internal matters of the ECB.

The General Council

The General Council consists of the President and Vice-President of the ECB and all the governors of the national central banks of the ESCB.

The General Council has taken over the duties performed by the European Monetary Institute (EMI). As not all Member States have adopted the euro, the ECB must continue to perform these duties in Stage three of the Economic and Monetary Union (EMU). These duties include, for example, reporting on the progress made by non-participating Member States towards convergence as well as advising on all the necessary preparations to irrevocably fix the exchange rates of their currencies.

Additionally, the General Council collaborates in certain activities of the ESCB , such as advisory functions and the compiling of statistical data.

Decision-making

Each member of the different bodies described here has one vote for decision-making and, in most cases, decisions are adopted by simple majority.

The exception to this includes decisions related to assets, capital, foreign currency reserve transfers and other matters that require a qualified majority, in which case the votes of the representatives of the national central banks are weighted according to their share in the capital of the ECB.