Hungary has amended a draft law on the central bank to comply with nearly all the changes demanded by the European Central Bank, a ruling Fidesz party lawmaker said on Tuesday after the European Commission asked Hungary not to adopt the legislation. Brussels believes the new legislation infringes upon the bank's independence, Olivier Bailly, spokesman for the European Commission told Reuters on Tuesday.
The amendments, submitted by Fidesz late on Monday and Tuesday, however, did not address ECB concerns over the expansion of the bank's Monetary Council and the appointment of a new vice governor by the prime minister - dubbed by Governor Andras Simor last week as a total government take-over of power. The EU's concerns about the original draft law promped the IMF and EU to suspend informal talks with Budapest late last week over financial assistance.
Bailly on Tuesday confirmed a Hungarian media report that Commission President Jose Manuel Barroso sent a letter to Hungarian Prime Minister Viktor Orban over the weekend - before the fresh amendments - asking him to withdraw the law from parliament.