Summary

On May 18, 1993, the Riigikogu (Estonian Parliament) adopted Law on the Bank of Estonia. Prior to that the organization and functioning of the Bank of Estonia had been covered by the provisions of the Banking Law of Estonia. The basic principle stipulated in the Law on the Bank of Estonia is the declaration of the absolute independence of the Bank of Estonia from state and governmental institutions. The central bank can execute the task delegated to it by the Constitution and attempt to stabilize of the national currency by minimizing inflation but only if it is independent of Government and other state institutions.