COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 31.12.1998 
COM(1998) 732 final 
98/0353 (CNB) 
Proposal for a 
COUNCIL REGULATION (EC) 
on the conversion rates between the euro 
and the currencies of the Member States adopting the euro 
(presented by the Commission) 

Proposal for a 
Council Regulation (EC) 
on the conversion rates between the euro 
and the currencies of the Member States adopting the euro 
EXPLANATORY MEMORANDUM 
As from 1 January 1999 the euro will be substituted for the present currencies of 
Belgium, Germany, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, 
Portugal and Finland. 
This substitution requires the adoption of the conversion rates at which the euro will be 
substituted for the national currencies and at which rates the euro, during a transitional 
period, will be divided into national currency units. 
I. General considerations 
Article 109 1 (4) of the Treaty foresees that the Council shall at the starting date of the 
third stage acting with the unanimity of the Member States without a derogation, on a 
proposal from the Commission and after consulting the ECB, adopt the conversion rates. 
In two Communiqués issued on 3 May 1998 and on 26 September 1998, the Ministers of 
the Member States adopting the euro as their single currency, the Governors of the 
Central Banks of these Member States, the Commission and the European Monetary 
institute/the European Central Bank have announced how the conversion rates will be 
determined and adopted on 31 December 1998. They have notably announced that: 
"On 31 December 1998, following the regular central bank concertation procedure 
... and in line with the existing procedures ... the Commission will calculate the 
final official ECU exchange rates for the participating currencies. The Commission 
will propose these rates for adoption by the Council as the irrevocable conversion 
rates for the euro." 
This procedure will ensure that the adoption of the conversion rates for the euro will by 
itself, as required by Article 109 1 (4) of the Treaty, not modify the external value of the 
ECU. 
In order to increase legal certainty and clarity for market operators and to speed up 
procedures in the afternoon of 31 December 1998, the Commission adopted its proposal 
for a Council Regulation without the conversion rates already on 9 December 1998. 
The official ECU rates of the currencies of the Member States adopting the euro have 
been calculated by the Commission on 31 December 1998 according to the established 
procedure. The Commission communicates these rates as the proposed irrevocably fixed 
conversion rates to the Council, the European Parliament and the European Central Bank. 
II. Comments on the articles 
Article 1 
This article specifies the conversion rates as referred to in the third indent of Article 1 of 
Council regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro1. 
The conversion rates establish, together with the provisions of Articles 2 and 3 of 
Council regulation (EC) No 974/98, the recurrent link between the euro and the national 
currencies of the Member States adopting the euro. 
Moreover, in accordance with Article 6 (1) of Council regulation (EC) No 974/98, the 
conversion rates determine during the transitional period, starting on 1 January 1999 and 
ending on 31 December 2001, how the euro will be divided into national currency units. 
In accordance with Council regulation (EC) No 1103/97 of 17 June 1997 on certain 
provisions relating to the introduction of the euro2, the conversion rates are determined 
with six significant figures; the rates are expressed as one euro in terms of each of the 
national currencies of the Member States adopting the euro. 
Article 2 
This article ensures that the regulation will be applicable as from the beginning of the 
third stage of Economic and Monetary Union, i.e. as from 1 January 1999, 0.00. a.m., 
local time. Council regulation (EC) No 974/98 will be applicable as from the same time. 
1 OJ No L 139,11.5.1998, p. 1 
2 OJNoL 162,19.6.1997, p. 1 
2-
Proposal for a Council Regulation (EC) 
on the conversion rates between the euro 
and the currencies of the Member States adopting the euro 
The Council of the European Union, 
Having regard to the Treaty establishing the European Community, and in particular 
Article 109 1 (4) first sentence thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Central Bank, 
(1) Whereas according to Article 109 j (4) of the Treaty, the third stage of Economic and 
Monetary Union shall start on 1 January 1999; whereas the Council, meeting in the 
composition of Heads of State or Government, has confirmed on 3 May 1998 that 
Belgium, Germany, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, 
Austria, Portugal and Finland fulfil the necessary conditions for the adoption of a 
single currency on 1 January 19991; 
(2) Whereas according to Council regulation (EC) No 974/98 of 3 May 19982, the euro 
shall be the currency of the Member States which adopt the single currency as from 
1 January 1999; whereas the introduction of the euro requires the adoption of the 
conversion rates at which the euro will be substituted for the national currencies and 
at which rates the euro will be divided into national currency units; whereas the 
conversion rates in Article 1 are the conversion rates referred to in the third indent of 
Article 1 of Council regulation (EC) No 974/98; 
1 OJNoL139, 11.5.1998, p. 30 
2 OJ No L 139, 11.5.1998, p. 1 
(3) Whereas according to Council regulation (EC) No 1103/97 of 17 June 1997 on 
certain provisions relating to the introduction of the euro3, every reference to the 
ECU in a legal instrument shall be replaced by a reference to the euro at a rate of one 
euro to one ECU; whereas Article 109 1 (4), second sentence of the Treaty, provides 
that the adoption of the conversion rates shall by itself not modify the external value 
of the ECU; whereas this is ensured by adopting as the conversion rates, the 
exchange rates against the ECU of the currencies of the Member States adopting the 
euro, as calculated by the Commission on 31 December 1998 according to the 
established procedure for the calculation of the daily official ECU rates; 
(4) Whereas the Ministers of the Member States adopting the euro as their single 
currency, the Governors of the Central Banks of these Member States, the 
Commission and the European Monetary Institute/the European Central Bank, have 
issued two Communiqués on the determination and on the adoption of the 
irrevocable conversion rates for the euro dated 3 May 19984 and 26 September 1998, 
respectively; 
(5) Whereas Council regulation (EC) No 1103/97 stipulates that the conversion rates 
shall be adopted as one euro expressed in terms of each of the national currencies of 
the Member States adopting the euro; whereas in order to ensure a high degree of 
accuracy, these rates will be adopted with six significant figures and no inverse rates 
nor bilateral rates between the currencies of the Member States adopting the euro 
will be defined; 
1 OJ No L 162,19.6.1997, p.l 
4 OJ No C 160,27.05.1998, p.l 
HAS ADOPTED THIS REGULATION: 
Article I 
The irrevocably fixed conversion rates between the euro and the currencies of the 
Member States adopting the euro are: 
leuro = 40.3399 Belgian franc 
= 1.95583 German mark 
= 166.386 Spanish peseta 
= 6.55957 French franc 
= 0.787564 Irish pound 
= 1936.27 Italian lira 
= 40.3399 Luxembourg franc 
= 2.20371 Dutch guilder 
= 13.7603 Austrian schilling 
= 200.482 Portuguese escudo 
= 5.94573 Finnish markka 
Article 2 
This Regulation shall enter into force on 1 January 1999. 
This Regulation shall be binding in its entirety and directly applicable in all Member 
States. 
Done at Brussels, 
For the Council 
The President 
ISSN 0254-1475 
COM(98) 732 final 
ENTS 
EN 09 10 01 06 
Catalogue number ; CB-CO-98-763-EN-C 
Office for Official Publications of die European Communities 
L-2985 Luxembourg