The Bank of Israel has submitted the treasury's proposed amendments to the Bank of Israel Law to the European Central Bank for review, Bank of Israel governor David Klein disclosed today.

Speaking at the Israel Democracy Institute's annual economics "Caesarea conference", taking place in Jerusalem this year, Klein said that the European Central Bank routinely reviews the laws of central banks belonging to nations that want to join the EU. It then recommends the changes that would be needed in the law, to meet EU standards.

It isn't that Israel means to join the EU: "Since the European Central Bank has become so adept at this work, we asked it to go over the existing Bank of Israel law and the amendments on the Knesset's agenda, to spot the differences between it and requirements of European central banks," Klein explained.

He said the European Central Bank acceded to the request and will announce its opinion shortly.

"Although we have not sought to become members of the EU, and are not candidates, the opinion may be of assistance as we come to amend the Bank of Israel law, which was enacted 50 years ago," Klein said.

"The law is antiquated and needs amendment, but not in such a form that would distance us from the boundaries of the developed nations, and classify us as a nation that should be avoided," he added.

Among other things, the treasury's amendments propose that monetary policy be set by council, instead of by the governor alone. The Bank of Israel has protested that the proposed amendments compromise its independence.