EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 7 March 2011 
on the recirculation of euro banknotes  
(CON/2011/19) 
 Introduction and legal basis
 
On 31 January 2011, the European Central Bank (ECB)  received a request from the Governor of the 
Banque de France for an opinion on a draft decree amending Articles R.122-7 to R.122-11, R.123-3 and R.162-5 of the French Monetary and Financial Code  (hereinafter the ‘draft  Decree’) and on a draft 
decision of the Governor of the Banque de France on the legal framework for the recycling of euro 
banknotes (hereinafter the ‘draft Decision’). On 16 Fe bruary 2011, the ECB received a revised version of 
the draft Decision, which cancels and replaces the former one. 
The ECB’s competence to deliver an  opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and the first, second and third indents of Article 2(1) of Council 
Decision 98/415/EC of 29 June 1998 on the consul tation of the European Central Bank by national 
authorities regarding draft legislative provisions
1, as the draft Decree and the draft Decision concern 
currency matters, means of payment and the Banque de  France. In accordance w ith the first sentence of 
Article 17.5 of the Rules of Procedure of the Eur opean Central Bank, the Governing Council has adopted 
this opinion. 
 1.  Purpose of the draft Decree and draft Decision 
1.1 The draft Decree will adapt the provisions of th e French Monetary and Financial Code on the 
recirculation of euro banknotes
2 to the new harmonised legal framework applying in the Member 
States whose currency is the euro. This framework  is established by Decision ECB/2010/14 of 16 
September 2010 on the authenticity and fitness checking and recirculation of euro banknotes3. The 
draft Decree will transfer full responsibility for th e implementation of agreements to be signed 
between cash handlers and the Banque de France in the context of this new legal framework to the 
Banque de France. It therefore deletes most of the provisions concerning sta ndard agreements to be 
signed between cash handlers and the Banque de Fran ce, including the requirement for the standard 
                                                 
1   OJ L 189, 3.7.1998, p. 42.  
2  Articles R.122-7 to R.122-11, R.123-3 and R.162-5 of the French Monetary and Financial Code. 
3  OJ L 267, 9.10.2010, p. 1. 
2 agreements to be approved by a decree of th e Minister for Economic Affairs, Finance and 
Industry4, while maintaining the requirement for cash handlers to sign agreements with the Banque 
de France as a prior condition to the recirculati on of euro banknotes. In this respect, the draft 
Decree provides that, where credit institutions, La Poste and payment institutions plan to supply 
automated teller machines with euro banknotes th at have not been directly obtained from a 
Eurosystem central bank, they must first enter in to an agreement with the Banque de France and 
respect the rules en acted by the Banque de France in acco rdance with those laid down by the 
European Central Bank5. 
1.2 In this context, the draft Decision6 mainly specifies the standard agreements7 to be signed between 
cash handlers and the Banque de France, upda ting currently existing standard agreements8. 
 2. General observations  
2.1 As Decision ECB/2010/14 applies to cash handlers by virtue of Article 6(1) of Council Regulation 
(EC) No 1338/2001 of 28  June 2001 laying down measures necessary for the protection of the euro 
against counterfeiting
9, which refers to procedures defined by the ECB for checking euro 
banknotes, there is no strict need to implement Decision ECB/2010/14 into French law. However, the ECB understands that the binding legal framework for the recirculation of euro banknotes already existing in France
10 has to be aligned with Decision ECB/2010/14. 
2.2 The ECB welcomes in this context the amendments  introduced by the draft Decree leading to the 
implementation of the standard agreements betw een cash handlers and the Banque de France under 
the sole responsibility of the Banque de France. The requirement for cash handlers to sign these 
agreements with the Banque de France as a prior condition to the recirculation of euro banknotes11 
is maintained, despite the direct imposition by Decision ECB/2010/14 of obligations on cash 
handlers. The ECB acknowledges that this aims at fostering complian ce of cash handlers in France 
with the rules and procedures laid down in D ecision ECB/2010/14. In this respect, the ECB 
welcomes the draft Decree and the draft Decision and is confident that this updated national legal 
                                                 
4  Under the current provisions, and in particular Article R 122-11 of the French Monetary and Financial Code, which the 
draft Decree will delete. 
5  Article R122-9 of the French Monetary and Fi nancial Code as proposed  by the draft Decree. 
6  The draft Decision is to be adopted on the basis of Artic le L.142-8 of the French Monetary and Financial Code, as 
recently amended, which now entitles the Governor of the Banque de France not only to transpose ECB Guidelines, but 
also to implement ECB decisions and other ECB legal acts. 
7  Standard agreement regarding the distribution through automa ted teller machines of banknot es not directly obtained from 
one of the Eurosystem’s central banks, standard agreement regarding the handling operations of euro banknotes by credit 
institutions or payment institutions with a view to their i ssue to the public through automated teller machines, standard 
agreement regarding the handling operations of euro banknotes by  the service providers of cr edit institutions or payment 
institutions with a view to their issue to the public through automated teller machines. 
8  See Ministerial Order of 20 June 2005 approving the current version of the template agreements, Journal Officiel de la 
République française , 16.7.2005. 
9   OJ L 181, 4.7.2001, p. 6. Article 6(1) was am ended on 18 December 2008 (OJ L 17, 22.1.2009, p. 1). 
10  The ECB had been consulted in 2004 on the legal framework for the recycling of euro banknotes in France and adopted 
Opinion CON/2004/8. 
11  Article R122-9 of the French Monetary and Fi nancial Code as proposed  by the draft Decree. 
3 framework will contribute to the preservation of  euro banknotes in circulation and to the 
maintenance of public confidence in euro banknotes. 
2.3 In addition, the ECB underlines the importa nce of harmonised standards on euro banknote 
recirculation across the Member States whose curre ncy is the euro. The ECB considers it essential 
for any national implementing measures to impl ement Decision ECB/2010/14 strictly and to not 
deviate from the common rules established under th is Decision, except when expressly provided 
for in the Decision. Moreover, national implem enting measures should clarify the primacy and 
direct applicability of the Union legislation on the authenticity and fitness checking and recirculation of euro banknotes to be complied with by cash handlers. In this context, in order to 
ensure the consistency of national implemen ting measures with Decision ECB/2010/14, the ECB 
favours the use of direct references to Decisi on ECB/2010/14, including its technical annexes. 
Alternatively, reproduction of the relevant prov isions of Decision ECB/2010/14 without additions 
is also acceptable. The ECB notes that while the draft Decision contains the necessary references to 
Decision ECB/2010/14 and generally reproduces the relevant provisions of Decision ECB/2010/14, 
subject to the specific observations in Section 3 below, the draft Decree could clarify further
12 the 
direct applicability of ECB rules to cash handlers, su ch rules applying by virtue of Article 6(1) of 
Council Regulation (EC) No 1338/2001, which mak es implementation of these rules into national 
law not strictly necessary from a legal point of view. 
 3. Specific observations  
3.1 Pursuant to Article 6 of the standard agreemen t set out in Annex I and Article 10 of the standard 
agreement set out in Annex II to the draft Decisi on (sanctions), the Banque de France may take 
measures with immediate effect against cash handler s that do not comply with the rules laid down 
in the respective standard agreem ent where there is a risk that category A or category 2 banknotes 
are put back into circulation. First, there should be a clear definition of these categories A and 2; a reference to Annexes IIa and IIb of Decision E CB/2010/14 would provide clarity in this respect. 
Second, euro banknotes not clearly authenticated (cat egory 3), which, according to ECB rules, have 
to be withdrawn from circulation and handed ove r to the competent national authorities, should 
also be mentioned in Article 6, and respectively Ar ticle 10, of the standard agreements set out in 
Annexes I and II of the draft Decision, together with category A and 2 ba nknotes, as they present a 
risk that counterfeit banknotes are put back into circulation
13. 
3.2 Article 7.4 of the standard agreement set out in  Annex II to the draft Decision requires particular 
cash handlers to report statistical data to the Banque  de France on a monthly basis. Pursuant to 
Annex IV to Decision ECB/2010/14, such data should be reported to  a national central bank (NCB) 
on a six-monthly basis. NCBs may ask for monthly reporting for a transitional period only, where 
                                                 
12  In Article R122-9 of the French Monetary a nd Financial Code resulting from the draft Decree. 
13  Banknotes not clearly authenticated are already part of category A referred to in Annex IIb of Decision ECB/2010/14. 
4 this was the practice of such NCB prior to De cision ECB/2010/14 entering into force. The current 
wording of Article 7.4 may however be interprete d as meaning that the monthly reporting is of a 
permanent nature for the cash handlers concerned,  which is not in line with Decision ECB/2010/14. 
The temporary nature of such monthly reporting should be clarified. 
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 7 March 2011. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET