CHAPTER IV MONETARY FUNCTIONS AND OPERATIONS OF THE ESCB ARTICLE 17 Accounts with the ECB and the national central banks. In order to conduct their operations, the ECB and the national central banks may open accounts for credit institutions, public entities and other market participants and accept assets, including book-entry securities, as collateral. ARTICLE 18 Open market and credit operations. 18.1. In order to achieve the objectives of the ESCB and to carry out its tasks, the ECB and the national central banks may: - operate in the financial markets by buying and selling outright (spot or forward) or under repurchase agreement and by lending or borrowing claims and marketable instruments, whether in Community or in non-Community currencies, as well as precious metals; - conduct credit operations with credit institutions and other market participants, with lending being based on adequate collateral. 18.2. The ECB shall establish general principles for open market and credit operations carried out by itself or the national central banks, including for the announcement of conditions under which they stand ready to enter into such transactions. ARTICLE 19 Minimum reserves 19.1. Subject to Article 2, the ECB may require credit institutions established in Member States to hold minimum reserves on accounts with the ECB and national central banks in pursuance of monetary policy objectives. Regulations concerning the calculation and determination of the required minimum reserves may be established by the Governing Council. In cases of non-compliance the ECB shall be entitled to levy penalty interest and to impose other sanctions with comparable effect. 19.2. For the application of this Article, the Council shall, in accordance with the procedure laid down in Article 42, define the basis for minimum reserves and the maximum reserves and the maximum permissible ratios between those reserves and their basis, as well as the appropriate sanctions in cases of non-compliance. ARTICLE 20 Other instruments of monetary control The Governing Council may, by a majority of two thirds of the votes cast, decide upon the use of such other operational methods of monetary control as it sees fit, respecting Article 2. The Council shall, in accordance with the procedure laid down in Article 42, define the scope of such methods if they impose obligations on third parties. ARTICLE 21 Operations with public entities. 21.1. In accordance with Article 104 of the Treaty, overdrafts or any other type of credit facility with the ECB or with the national central banks in favour of Community institutions or bodies, central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of Member States shall be prohibited, as shall the purchase directly from them by the ECB or national central banks of debt instruments. 21.2. The ECB and national central banks may act as fiscal agents for the entities referred to in 21.1.