40 OfficialJournaloftheEuropeanCommunities
27.3.71 OfficialJournaloftheEuropeanCommunities NoC28/1
RESOLUTION OFTHECOUNCILANDOFTHEREPRESENTATIVES OFTHE
GOVERNMENTS OFTHEMEMBERSTATES
of22March1971
ontheattainmentbystagesofeconomicandmonetaryunionintheCommunity
THECOUNCILOFTHEEUROPEAN COMMUNITIES
ANDTHEREPRESENTATIVES OFTHEGOVERN­
MENTSOFTHEMEMBERSTATES,
HavingregardtothefinalcommuniqueoftheConfer­
enceofHeadsofStateorGovernment heldon1and2
December1969atTheHague,andinparticularpoint8
inwhichtheyexpressedtheirwishtoseetheCommunity
developintoaneconomicandmonetaryunionthrough
theimplementation ofaphasedplan;
Havingregardtothejointconclusionsoftheinterim
report1oftheGroupsetupbytheCouncilDecisionof6
March1970underthechairmanshipofMrPierreWer­
ner,PresidentandMinisterofFinanceoftheLuxem­
bourgGovernment,whichwereadoptedbytheCouncil
atits116thmeetingon8and9June19702,namelythat:
-Theultimateobjective,aslaiddownbytheConfer­
enceofHeadsofStateorGovernment ,appearstobe
onethatcanbeattainedwithinthepresentdecade,
providedthatitcontinuestoenjoythepoliticalsup­
portofthegovernments ;
-economicandmonetaryunionmeansthatthemain
economicpolicydecisionswillbetakenatCommu­
nitylevelandthereforethatthenecessarypowerswill
betransferredfromthenationaltotheCommunity
level.Theadoptionofasinglecurrencycouldbethe
finalstageofthisunion,ensuringtheirreversibility of
theprocess;
-throughouttheprocess,actionwillhavetobetaken
simultaneously andprogressively onanumberof
fronts.Certainmeasureswillrequireamendmentof
theTreatyofRome,andthepreparatoryworkforthis
shouldthereforebecompletedduringthefirststage.
However,theexistingprovisionsalreadyallowsub­
stantialprogresstobemade;
-thefirststageshouldbeginon1January1971andbe
completedwithinaspecifiedperiod;practicalconsi­
derationssuggestthatathree-yearperiodwouldbe
appropriate .Thisstagewillbedevotedtoincreasing
theeffectivenessoftheinstrumentsemployedbytheCommunityandtotakingthefirststepsinestablish­
ingtheCommunity'sidentitywithintheinternational
monetarysystem;
-thefirststageshouldnotbeconsideredasanendin
itself;itcannotbedissociatedfromtheoverallpro­
cessofeconomicandmonetaryintegration .Itshould,
therefore,beembarkeduponwithdetermination to
attaintheultimateobjective;
-thisfirststageshouldincludeastrengtheningofcon­
sultationproceduresbymethodsyettobedeter­
mined;thebudgetarypolicyofMemberStatesshould
beconductedinaccordancewithCommunityobjec­
tives;somedegreeoffiscalharmonization shouldbe
carriedout;monetaryandcreditpoliciesshouldbe
closelycoordinatedandthecapitalmarketsfurther
integrated;
-theCommunityshouldprogressivelyadoptcommon
standpointsinitsmonetaryrelationswiththirdcoun­
triesandinternationJorganizations ;inparticular,it
shouldnotavailitselfinmattersofexchangerates
betweenMemberStatesofanyarrangements which
mightleadtoaweakeningoftheinternationalex­
changesystem;
Havingregardtothesuggestionsputforwardbythe
Groupinitsfinalreport,andsharingtheviewsexpressed
onthefactorswhichareessentialfortheexistenceofan
economicandmonetaryunionandontheresultsofsuch
aunionintermsofeconomicpolicy;
Recognizingtheprofoundpoliticalsignificancewhich
theattainmentofeconomicandmonetaryunionhasfor
theCommunityanditsMemberStates;
Desiringtoreaffirmtheirreversiblenatureoftheaction
whichHeadsofStateorGovernment havedecidedto
takeforthecreationofaneconomicandmonetary
union;
HavingregardtotheproposalfromtheCommission ;
1OJNoC94,23.7.1970,p.8.
2OJNoC136,11.11.1970,p.19.HavingregardtotheOpinionoftheEuropeanParlia­
ment,

OfficialJournaloftheEuropeanCommunities 41
HAVEADOPTEDTHISRESOLUTION :
I-policywithregardtotheunifiedcapitalmarketand
capitalmovementstoandfromthirdcountries;
-budgetaryandfiscalpoliciesasrelatedtothepolicy
ofstabilityandgrowth;asregardsbudgetarypolicy
proper,themarginswithinwhichtheessentialele­
mentsofpublicbudgetsasawholeshouldlie,inpar­
ticularthevariationoftheiramount,andthesize,
modeoffinancinganduseofbalances,shallbedeter­
minedatCommunitylevel;
-thestructuralandregionalmeasureswhicharealso
necessary,aspartofaproperlysupportedCommu­
nitypolicy,topromotethebalanceddevelopmentof*
theCommunityandresolvethemajorproblems.
II
Asprogressismadetowardstheultimateobjective
Communityinstrumentsshallbecreatedasnecessaryto
replaceortosupplementnationalinstruments .
Themeasurestobetakenineachsectorshallbeinterde­
pendent,eachreinforcingtheother;inparticular,pro­
gresstowardsmonetaryunionmustbeaccompaniedby
parallelprogressinthealignmentandultimateunifica­
tionofeconomicpolicies.
Ill.Inordertoachievesimultaneously withintheCommu­
nityasatisfactoryrateofgrowth,fullemploymentand
stability,tocorrectthestructuralorregionalimbalances
arisingthereinandtostrengthentheCommunity'scon­
tributiontointernationaleconomicandmonetarycoop­
erationandtherebytoachieveaCommunityenjoying
stabilityandgrowth,theCouncilandtheRepresenta­
tivesoftheGovernmentsoftheMemberStatesexpress
theirpoliticalwilltoestablishaneconomicandmone­
,taryunion,duringthecomingdecade,inaccordance
withaplanbystagesbeginningon1January1971.
Thestepstobetakenmustbesuchthat,attheconclu­
sionofthisprocess,theCommunitywill:
1.Constituteanareawithinwhichpersons,goods,ser­
vicesandcapitalmaymovefreelyandwithoutdistor­
tionofcompetition ,without,however,givingriseto
structuralorregionalimbalances,underconditions
permittingeconomicactivitytoexpandonaCommu­
nityscale;
2.Formasinglecurrencyareawithintheinternational
system,characterized bythetotalandirreversible
covertibilityofcurrencies,theeliminationofmargins
offluctuationofexchangerates,theirrevocablelock­
ingofparities-allofwhichareessentialprecondi­
tionsforthecreationofasinglecurrency-andin­
cludingaCommunityorganizationoftheCentral
Banks;
3.Possesssuchpowersandresponsibilities ineconomic
andmonetarymattersaswillenableitsinstitutionsto
administertheunion.Tothisendtherequisitedeci­
sionsoneconomicpolicyshallbetakenatCommu­
nitylevelandthenecessarypowersshallbeconferred
upontheinstitutionsoftheCommunity .
Powersandresponsibilities shallbedistributedbetween
CommunityinstitutionsontheonehandandMember
Statesontheotherinaccordancewithwhatisnecessary
forthecohesionof-theunionandfortheeffectiveness of
Communityaction.-
TheinstitutionsoftheCommunityshallbeputinaposi­
tiontoexercisetheirresponsibilities ineconomicand
monetarymattersefficientlyandwithspeed.
Communitypoliciespursuedwithintheframeworkof
theeconomicandmonetaryunionshallbesubjectto
debateandcontrolbytheEuropeanParliament .
TheCommunityorganizationoftheCentralBanksshall,
withinitsfieldofresponsibility ,assistinachievingsta­
bilityandgrowthwithintheCommunity .
Theprinciplessetoutaboveshallbeappliedtothe
following:
-theinternalmonetaryandcreditpoliciesoftheunion;
-monetarypolicytowardstheoutsideworld;Inordertoattaintheseobjectives,theCouncilandthe
Representatives oftheGovernments oftheMember
Statesagreetosetinmotionfrom1January1974a
seriesofmeasurestobecarriedoutduringafirststage
lastingthreeyears:
1.ActingonaproposalfromtheCommission ,theCoun­
cilshalllaydownsuchprovisionsforstrengthening
thecoordinationofshort-termeconomicpoliciesas
willmakecoordinationreallyeffective,inparticular
bymakingmoreintensiveandwidespreaduseofthe
obligatorypriorconsultationprocedures.Thiscoordi­
nationofshort-termeconomicpoliciesshalltakeinto
accounttheguidelinesunderthemedium-term econ­
omicpolicyprogrammes .
TothisendtheCouncilhasagreedthat,actingona
proposalmadebytheCommissionafterconsultation
withbothsidesofindustrythroughtheEconomicand
SocialCommitteeorbyothermeans,itwilllaydown
thebroadoutlinesofeconomicpolicyatCommunity
levelandquantitativeguidelinesfortheessentialele­
mentsofpublicbudgets.
Tofacilitatecoordinationofeconomicpoliciesthe
Councilhasagreedthat,actingonaproposalfrom
theCommissionandafterobtainingtheopinionsof
theCommitteesconcerned,itwilltakethenecessary
measuresforprogressiveharmonization oftheinstru­
mentsofeconomicpolicy,andinparticularforthe
synchronization ofnationalbudgetaryprocedures .
2.Inorderthateffectivelyfreemovementofpersons,
goods,servicesandcapitalandprogressininterpene­
trationofeconomiesmaybeachievedatafasterrate,

42 OfficialJournaloftheEuropeanCommunities
theCouncil,actingonaproposalfromtheCommis­
sionandhavingregardtotheneedtopreserveabal­
ance,shalldecideonmeasuresconcerning :
-Communityrulesdeterminingtheuniformbasisfor
assessingthevalueaddedtaxwithinthemeaningof
theDecisionof21April19701onthereplacement
offinancialcontributions fromtheMemberStates
bytheCommunities'ownresources;
-theharmonization ofthescope,basisofassessment
andthemodeoflevyingexciseduties,inparticular
thosewhichhaveanappreciableinfluenceon
trade;
-theharmonization ofthosekindsoftaxwhichare
likelytohaveadirectinfluenceoncapitalmove­
mentswithintheCommunity ,inparticularthetax­
ationofinterestfromfixed-interest securitiesand
dividends;
-thefurtherharmonization ofthetaxationofcom­
paniesandfirms;
-theprogressiveextensionofduty-freeconcessions
grantedtoprivateindividualscrossingfrontiers
withintheCommunity .
BeforetheendofthefirststagetheCouncilshallexa­
minetheresultsofresearchonthealignmentofratesof
valueaddedtaxandexcisedutiesandtheproposalsof
theCommission inthisfield.
3.Withaviewtoencouragingthefreemovementofcap­
ital,theCouncil,actingonaproposalfromtheCom­
mission,shall:
-adoptaDirectivelayingdownproceduresfor
progressiveliberalizationwherebyissuesofsecuri­
tiesonthecapitalmarketwillbeauthorizedwith­
outdiscrimination andabolishinganydifferential
treatmentintheintroduction onthemarketofse­
curitiesissuedbyresidentsofotherMemberStates;
-establishaprocedurefortheprogressivecoordina­
tionofthepoliciesofMemberStatesinrespectof
capitalmarkets.
4.Inordertoreduce,bymeansofregionalandstructural
measures,anytensionsthatcouldprejudicetheulti­
mateattainmentofeconomicandmonetaryunion,the
Council,actingonaproposalfromtheCommission ,
shalldecideonthemeasuresnecessaryforafirststep
towardsresolvingthemosturgentquestions,bearing
inmindthedirectionscontainedinthethirdmed­
ium-termeconomicpolicyprogramme,andinparti­
cularbyprovidingtheCommunitywiththenecessary
meansunderthetreatiesinforce.
5.Withaviewtostrengtheningthecoordinationofthe
monetaryandcreditpoliciesofMemberStates,the
Councilhasagreedthat:
-morestressshallbelaidintheMonetaryCommit­
teeandtheCommitteeofGovernorsofCentral
Banksonobligatorypriorconsultation;-theCentralBanksshallbeinvited,withinthelimits
oftheirpowersandseveralresponsibilities ,tocoor­
dinatetheirpoliciesintheCommitteeofGovernors
%ofCentralBanks,whileobservingtheguidelinesfor
generaleconomicpolicyissuedbytheCouncil;
-theMonetaryCommitteeandtheCommitteeof
GovernorsofCentralBanksshallworkcloselyto­
getherintheharmonization oftheinstrumentsof
monetarypolicy.
6.TheCouncilhasagreedthattheCommunityshall
progressivelyadoptcommonstandpointsinmonetary
relationswiththirdcountriesandwithinternational
organizations ;inparticular,itshallnotavailitselfin
mattersofexchangeratesbetweenMemberStatesof
anyarrangementswhichmightleadtoaweakeningof
theinternationalexchangesystem.
7.TheCouncilandtheMemberStatesshallinvitethe
CentralBanksofMemberStates,fromthebeginning
ofthefirststageandonanexperimentalbasis,tohold
exchangeratefluctuationsbetweenthecurrenciesof
MemberStateswithinmarginsnarrowerthanthose
resultingfromtheapplicationofthemarginsinforce
fortheUSdollar,bymeansofconcertedactionwith
respecttothatcurrency.
TheCouncilhasagreedthat,dependingoncircum­
stancesandontheresultsobtainedintheharmoniza­
tionofeconomicpolicies,furthermeasuresmaybe
taken,consistingofatransitionfromadefactotoa
dejuresystem,ofinterventioninthecurrenciesof
MemberStatesandofsuccessivereductionsinthe
marginsoffluctuationbetweenthecurrenciesof
MemberStates.TheCommitteeofGovernorsofCen­
tralBanksshallreporttwiceyearlytotheCounciland
totheCommission ontheeffectoftheconcertedac­
tionbythecentralBanksontheexchangemarket,and
whetherthereisaneedforfurthermeasuresinthis
field.
8.TheCouncilshallinvitetheMonetaryCommitteeand
theCommitteeofGovernorsofCentralBanksto
drawup,inclosecollaboration andby30June1972
atthelatest,areportontheorganization,functions
andstatutesofaEuropeanMonetaryCooperation
Fund,tobeintegratedatalaterstageintotheCom­
munityorganizationoftheCentralBanksprovidedfor
inSectionI(2),withaviewtothepossibleestablish­
mentofthisFundduringthefirststage,iftheresults
obtainedinreducingmarginsandaligningeconomic
policiessojustify.Theyshallsubmitthisreporttothe
CouncilandtotheCommission .
9.Inordertopromotetheharmoniousimplementation
oftheplanforeconomicandmonetaryunionand,
aboveall,toensurethateconomicmeasureskeepsuf­
ficientlyinstepwithmonetarymeasures,themone­
taryprovisions,thatistosaythoseofSectionni(7)
and(8),andthemechanismformedium-termfinan­
cialassistanceshallbeoperativeforfiveyearsfrom
thebeginningofthefirststage.Afteragreementhas 1OJNoL94,28.4.1970,p.19.

Official *JournaloftheEuropeanCommunities 43
beenreachedtoproceedtothesecondstage,theprovi­
sionsmentionedaboveshallcontinueinforce.
IV
TheCounciltakesnotethattheCommission willsubmit
toitbefore1May1973:CommunityandtheMemberStateswhich,particu­
laryinthefieldsofconjuncturalpolicy,monetaryand
creditpolicy,andbudgetarypolicy,maybenecessary
fortheefficientfunctioningofaneconomicandmo­
netaryunion.
TheCounciland,whereappropriate,theRepresenta­
tivesoftheGovernmentsoftheMemberStates,acting
onaproposalfromtheCommission ,shall,beforethe
endofthefirstthree-yearstage,adoptmeasureswhich
willlead,aftertransitiontothesecondstage,totheat­
tainmentoffulleconomicandmonetaryunion:
-eitheronthebasisoftheexistingprovisionsofthe
Treaty;
-oronthebasisofArticle235oftheTreaty;
-oronthebasisofArticle236oftheTreaty.-anassessmentoftheprogressmadeduringthefirst
stage,giventhatcoordinationofeconomicpolicies
andprogressinmonetarymatterswithintheCommu­
nitymustproceedinparallel;
-areport,drawnupincollaborationwiththeadvisory
committeesconcerned,ontheredistribution ofpow­
ersandresponsibilities betweentheinstitutionsofthe