EN ECB -PUBLIC  
 
OPINION OF THE EUROPEAN CENTRAL BANK  
of 20 January 2016  
on supervision of activities of cash handlers and  imposition of administrative measures and 
penalties  
(CON/2016/ 2) 
 
Introduction and legal basis  
On 30 November  2015 the European Central Bank (ECB) received a request from the Lithuanian Ministry 
of Finance for an opinion on a draft law amending and supplementing the Law on Lietuvos bankas  
(hereinafter  the ‘draft law’).  
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/EC1, as the draft law relates to currency matters, means of payment and Lietuvos 
bankas. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European 
Central Bank, the Governing Council has adopted this opinion.  
 
1. Purpose of the draft law  
1.1. The requirements of Council Regulation (EC) No 1338/20012, Regulation (EU) No 1210/2010 of 
the European Parliament and of the Council3, and Decision ECB/2010/14 of the European Central 
Bank4 have been partially implemented in Lithuania by Resolution No 03- 162 of the Board of 
Lietuvos bankas setting out procedures for authenticity and fitness checking and recirculation of 
euro banknotes and coins5.  
1.2. The main objective of the draft law is to further implement the requirements  of the above mentioned 
Union legal acts. To this end, the draft law  (a) clarif ies the rights and obligations of Lietuvos bankas 
in super vising how cash handlers fulfil the requirements for the authenticity and fitness checking 
and recirculation of euro banknotes and coins , and (b) lays down measures ensuring that breaches 
of these requirements are subject to effective, proportionate and deterrent sanctions.  
                                                 
1  Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank by national 
authorities regarding draft legislative provisi ons ( OJ L 189, 3.7.1998, p. 42) . 
2  Council Regulation (EC) No 1338/2001 of 28 June 2001 laying down measures necessary for the protection of the 
euro against counterfeiting (OJ L 181, 4.7.2001, p. 6).  
3  Regulation (EU) No 1210/2010 of the European Parliament and of the Council of 15 December 2010 concerning 
authentication of euro coins and handling of euro coins unfit for circulation (OJ L 339, 22.12.2010, p. 1).  
4  Decision ECB/2010/14 of the European Central Bank of 16 September 2010 on the authenticity and fitness checking 
and recirculation of euro banknotes  (OJ L 267, 9.10.2010, p. 1).  
5  Resolution No 03- 162 of the Board of Lietuvos bankas  of 16 September  2014  on the procedures for authenticity and 
fitness checking and recirculation of euro banknotes and coins (Register of Legal Acts, 22 September 2014, No 
2014- 12683) . 
ECB -PUBLIC  
2 1.3. The draft law introduces a specific sanctioning regime for persons committing infringements. In 
accordance with Article 477(6) of the draft law, Lietuvos bankas has the right to impose 
administrative fines amounting to a maximum of  10 %  of total annual income in the case of legal 
persons  and EUR 50,000 in the case of natural persons .   
 
2. General observations  
2.1. The ECB notes that it has previously been consulted by Lietuvos bankas on R esolution No 03- 162 
of the Board of Lietuvos bankas when it was at draft stage6. Some of the ECB’s remarks previously 
expressed in its opinion given in response to that  consultation are also applicable to the draft law . 
2.2. The ECB considers it essential that any draft legislation should uphold the principle of the primacy 
and direct application of Union law on the authentication of euro banknotes and coins and the 
handling of euro banknotes and coins unfit for circulation. For consistency’s sake, the ECB favours the use in national legislation of direct references to Regulation (EC) No  1338/2001, Regulation 
(EU) No 1210/2010 and Decision ECB/2010/14 or, alternatively, the reproduction of their provisions 
without any alterations or additions
7. 
2.3. In its  previous opinion8 the ECB noted that the national regime for sancti ons and reporting did not 
fully reflect Regulation (EC) No 1338/2001 and Decision ECB/2010/14 as regards the range of sanctions that may be imposed for failing to carry out authenticity and fitness checking of euro banknotes and coins prior to circulation.  In addition, the ECB noted that Lithuanian legislation did 
not provide for the imposition of administrative penalties (fines ) on legal entities.  
2.4. The ECB welcomes the draft law , which takes into account those observations  and establishes  a 
deterrent sanct ions regime for non- compliant cash handlers. The ECB is confident that the 
provisions of the draft law will support the protection of euro banknotes and coins in circulation and thereby maintain the general public’s confidence in euro banknotes and coins.  
2.5. The ECB believes that the sanctioning regimes available in the Member States that have aligned 
their law with Regulation (EC) No 1338/2001 in conjunction with Decision ECB/2010/14 may 
benefit from  harmonisation insofar as the procedures laid down by the EC B in that Decision are 
equally applicable to all cash handlers located in the euro area
9. In this respect, the ECB considers 
it important for national authorities to contribute to the establishment of a level playing field among 
cash handlers falling withi n the scope of Regulation (EC) 1338/2001, without prejudice to ( a) the 
particularities of the cash cycle and the organisation of cash handlers at national level, and ( b) the 
consistency of the levels of financial penalties  available in their legal system s. 
 
                                                 
6  See Opinion CON/2014/65. All ECB opinions are published on the ECB’s website at www.ecb.europa.eu.  
7  See paragraph 2.2 of Opini on CON/ 2014/65.  
8  See paragraph 6.3 of Opinion CON/2014/65.  
9  See paragraph 3.4 of Opinion CON/2010/87.  
ECB -PUBLIC  
3 3. Specific observations  
3.1. Under the draft law , when non- compliance by a cash handler with relevant Union acts, including 
ECB legal acts, or the provisions of the draft law, is detected, Lietuvos bankas  may, among other 
things, prohibit a cash handler from recirculating euro banknote denominations of the series 
concerned until such non- compliance is rectified10. The ECB reiterates  that when Lietuvos bankas  
prohibits recirculation in such a situation, it does so on behalf of the ECB11. 
3.2. To ensure that fines have a  deterrent effect, the maximum amount of a fine should be a sum  which 
effectively deters cash handlers from breaching their obligations12. In this respect , the ECB 
welcomes the provision of the draft law which grants the right to Lietuvos bankas , notwithsta nding 
the maximum fines set out in the draft law , to impose a fine of up to the double the amount of any 
illegal income, other financial benefits, evaded losses or damage caused due to the infringement  in 
question.   
 
This opinion will be published on the E CB’s website.  
 
 
Done at Frankfurt am Main, 20 January  2016.  
 
[signed]  
 The President of the ECB  
Mario DRAGHI  
                                                 
10  Article 477(1)(1) of the draft law. 
11  In accordance with Article 10(3) of Decision ECB/2010/14.  
12  See paragraph 4.2 of Opinion CON /2011/105.