EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 16 June 2008 
at the request of Narodowy Bank Polski  
on a draft ordinance amending the principles and procedure for replacing banknotes and coins 
which have ceased to be legal tender in Pola nd as a result of wear and tear or damage 
(CON/2008/26) 
 Introduction and legal basis
 
On 21 May 2008 the ECB received a request from the President of Narodowy Bank Polski (NBP) for an 
opinion on a draft ordinance amending the NBP Pr esident’s Ordinance No. 1/2003 on the detailed 
principles and procedure for replacing banknotes and co ins which have ceased to be legal tender in 
Poland as a result of wear and tear or damage1 (hereinafter the ‘draft ordinance’).  
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the first and second indents of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions2, as the draft law relates to currency matt ers and means of payment. In accordance 
with the first sentence of Article 17.5 of the Rul es of Procedure of the European Central Bank, the 
Governing Council has adopted this opinion.  
 1.  Purpose of the draft ordinance The draft ordinance follows the NBP President’s  Ordinance No 19/2007 of 24 October 2007 on the 
method and procedure to be used in counting, sor ting, packaging and labelling banknotes and coins, on 
which the ECB commented in Opinion CON/2007/28
3. The draft ordinance, which regulates only the 
circulation of the Polish currency4, has as its main objective ensuri ng compliance of the principles for 
                                                 
1  Ordinance of the NBP President No 1/2003 on the detailed principles and procedure for replacing banknotes and coins 
which have ceased to be legal tender within the territory of the Republic of Poland as a result of wear and tear or damage 
(Dz. Urz. NBP of 15 January 2003 No 1, Item 1, as ame nded). Article 34(2) of the Law on Narodowy Bank Polski of 
29 August 1997 forms the statutory basis (cons olidated text: Dz.U. of 2005 No 1, it em 2, as amended; hereinafter the 
‘Law on NBP’). 
2  OJ L 189, 3.7.1998, p. 42. 
3  See ECB Opinion CON/2007/28 of 25 September 2007 at the re quest of the President of Narodowy Bank Polski on a 
draft ordinance on the method and procedure for counting, sort ing, packaging and labelling packaging units of banknotes 
and coins, and in conducting activities related to  the supply of banknotes and coins to banks. 
4  Although the draft ordinance does not refer to any specific currency, Articles 32 to 34 of the Law on NBP, constituting 
the legal basis for the adoption of Ordinance No 1/2003, as am ended by the current draft ordinance, limit the scope to the 
Polish currency issued by NBP. 
2 coin replacement  with the principles for determination of coins unfit for circulation in the NBP 
President’s Ordinance No 19/20075. As a result of the draft proposal, the criteria for replacing damaged 
coins will be defined in a more ge neral manner, without referring to specific types of damage which may 
be incurred by coin elements6.  
 
2. General observations 2.1 The draft ordinance introduces into the NBP Presi dent’s Ordinance No 1/2003 a number of detailed 
technical amendments related mainly to circula tion and the withdrawal of coins on which the ECB 
has no specific comments.  
2.2 At the same time, the ECB would like to reitera te some of its more general comments made in 
Opinion CON/2007/28 which are also valid in th e context of the NBP President’s Ordinance 
No. 1/2003, as amended by the draft ordinance
7. While the ECB’s requirements for the exchange 
and withdrawal of euro banknotes in Member States  that have adopted the euro currently do not 
apply to Poland as a Member State with a dero gation, these requirements will apply once Poland 
adopts the euro and NBP becomes a fully integrated part of the Eurosystem. The ECB notes that NBP’s provisions on the principles and procedure for replacing banknotes differ substantially from 
the Eurosystem rules and that they will have to be  aligned with Eurosystem practice before Poland 
adopts the euro. In the meanti me, the continued divergence of  the NBP’s provisions and 
Eurosystem practice gives rise to some c oncerns, as indicated in the following.  
 3.  Alignment of Polish legislation with the ECB’s legal framework 3.1 From the underlying principle of the NBP President’s Ordinance No 1/2003, it follows that 
banknotes and coins which do not fulfil NBP’s conditi ons because of wear or damage cease to be 
legal tender in Poland and are subject to exchange
8. However, according to the ECB’s rules for euro 
banknotes, the status of genuine euro banknotes as le gal tender is not affected by their physical 
condition, including such elements as mutilation or damage9.  
3.2 The ECB further notes the requirement in para graph 3(1)(1) of the NBP President’s Ordinance 
No 1/2003, as amended by the draft ordinance10, and in paragraph 7 of the NBP President’s 
Ordinance No 1/2003 following which banknotes may be exchanged if between 45% and 75% of a 
banknote’s original surface is presented, either in one piece (when presented to commercial banks) 
or possibly in a number of pieces (when presented to NBP’s branches). Such rules differ from the 
                                                 
5  See the explanatory memorandum to  the draft ordinance, p. 1. 
6  See e.g. paragraph 1(2) of the draft ordinance, amending paragraph 2(1)(2) of the NBP President’s Ordinance No 1/2003. 
7  See paragraphs 2.1 and 2.3 of ECB Opinion CON/2007/28. 
8  See Article 34(1) of the Law on NBP and further im plemented by the NBP President’s Ordinance No 1/2003. 
9  See Article 3(1) of Decision ECB/2003/4 of 20 March 2003 on the denominations, specifica tions, reproduction, exchange 
and withdrawal of euro banknotes  (OJ L 78, 25. 3. 2003, p. 16). 
10  See paragraph 1(3) of the draft ordinance. 
3 ECB’s for euro banknotes, following which a Euro system national central bank may exchange a 
euro banknote for 100% of its face value if more  than 50% of the euro banknote is presented, 
whether presented in one piece or not11.  
3.3 The ECB is concerned that the abovementioned provisions tend to diverge from the solutions 
already firmly established under the ECB’s lega l framework for euro banknotes. In view of 
Poland’s future adoption of euro, the ECB inv ites the NBP to already consider aligning its 
standards for exchange and withdrawal of bankno tes with a view to approximating these standards 
with the rules applicable to euro banknotes. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 16 June 2008. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
11  Or, alternatively, when 50% or less of the euro banknote is  presented and the applicant pr oves that the missing parts have 
been destroyed. See Article 3(1) of Decision ECB/2003/4.