President Joseph Aoun has filed a partial challenge before the Constitutional Council against Article 3 of the Law on Bank Restructuring, enacted in August 2026.
The Challenge to Article 3
The legal dispute focuses on the third article of the Law on Bank Restructuring and Reorganization. While the law was signed by President Aoun, his subsequent challenge suggests a desire to ensure the legislation does not override the Code of Money and Credit. According to the Legal Agenda, the challenge was unexpected, occurring after the law had already been issued. Critics and legal observers argue that the independence of the central bank is a guarantee of a public function defined by law, rather than a personal privilege of the governor.
Member of Parliament Ghassan Hasbani noted that the President’s challenge is aimed at protecting the constitutional mechanisms governing the central bank. Hasbani pointed to potential procedural irregularities, noting that while the cabinet and the Finance and Budget Committee proposed amendments, the final vote in the General Assembly may not have adhered to internal parliamentary regulations. The challenge seeks to prevent a conflict of authority between the central bank and any other body tasked with bank restructuring, ensuring the bank maintains its power to issue circulars and regulate the sector.
Legislative Leaders Warn Move Undermines Reform Process
The move has drawn sharp criticism from some legislative quarters. Jihad Al-Samad, head of the National Defense, Interior, and Municipalities Committee, described the challenge as a new precedent since the Taif Agreement that risks undermining the role of the Prime Minister and the reform process itself. Al-Samad emphasized that the President himself had originally referred the project to Parliament, which subsequently approved it.
Jihad Al-Samad said that “it is a blow against his own signature and against reforms under the pretext of protecting sectarian privileges, and the most dangerous thing of all is the persistence in striking at the powers of the Prime Minister to marginalize his role and obstruct the attempt to reform the banks.”
Conversely, other sources suggest that the challenge is a necessary step to restore order.
Implications for the International Monetary Fund
There is widespread concern that the challenge could impede ongoing negotiations with the International Monetary Fund (IMF). The reform of the banking sector is a key condition for a final agreement. While some analysts fear a return to point zero, others, including MP Hasbani, argue that the challenge is not directed against the IMF but is a domestic constitutional matter. The IMF has previously supported the reform path, but current legal uncertainty complicates officials' efforts to finalize the agreement.
