he ECB and of the central banks of the Member States
("national central banks"). The Insitut monetaire luxembourgeois will
be the central bank of Luxembourg.

CHAPTER II
OBJECTIVES AND TASKS OF ESCB
ARTICLE 2
Objectives
In accordance with Article 105(1) of this Treaty, the primary objective of
the ESCB shall be to maintain price stability. Without prejudice to the
objective of price stability, it shall support the general economic
policies in the Community with a view to contributing to the
achievement of the objectives of the Community as laid down in Article
2 of this Treaty. The ESCB 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 3a of this Treaty.
ARTICLE 3
Tasks
3.1. In accordance with Article 105(2) of this Treaty, the basic tasks to
be carried out through the ESCB shall be:
- to define and implement the monetary policy of the Community;
- to conduct foreign exchange operations consistent with the
provisions of Article 109 of this Treaty;
- to hold and manage the official foreign reserves of the Member
States;
- to promote the smooth operation on payment systems.
3.2. In accordance with Article 105(3) of this Treaty, the third indent of
Article 3.1 shall be without prejudice to the holding and management
by the governments of Member States of foreign exchange working
balances.
3.3. In accordance with Article 105(5) of this Treaty, the ESCB 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.
ARTICLE 4
Advisory functions
In accordance with Article 105(4) of this Treaty:
(a) the ECB shall be consulted:
- on any proposed Community act in its fields of competence;
- 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 in accordance with the procedure laid down in
Article 42;
(b) the ECB may submit opinions to the appropriate Community
institutions or bodies or to national authorities on matters in its fields
of competence.
ARTICLE 5
Collection of statistical information
5.1. In order to undertake the tasks of the ESCB, the ECB, assisted by
the national central banks, shall collect the necessary statistical
inf