WRITTEN QUESTION E-2844/97 by Klaus-Heiner Lehne (PPE) to the Commission (11 September 1997)

Subject: Bank charges in connection with introduction of the euro

'Europe without Frontiers', a newssheet published as a monthly letter by the Commission's Directorate-General for Information, Communications, Culture and Audiovisual Media (ISSN 1021-2345) states on page 2 of its June 1997 edition (time of going to press 20 May 1997) under the heading 'Practical Questions for the Euro and Answers in Spring 1998?' that:

Exchanging national currency for the euro after 1 January 1999 should not cost users any more than the actual technical expenses incurred by the banks.

1. What expenses are involved in this respect?

2. Does the Commission think it right that, in making the necessary exchange of legal tender, the costs of the changeover should be passed on to the consumer?

3. Is it consistent with the law to charge the individual consumer for an exchange of legal tender which is required by the government authorities?

4. Given that exchange of legal tender is essentially a government measure, should these costs not be borne by the public budget?

5. What does the Commission intend to do to avoid any additional costs of the changeover intensifying the misgivings in the minds of a large section of the population about the euro?

6. Is it not possible to require the banks under the transitional regulations to effect the changeover free of charge to the consumer?

7. What is the Commission's view, in the light of questions 1-6, of the decision of the Federal Supreme Court of 15 July 1997 in cases XI ZR 269/96 and 279/96 concerning the exemption from charges for the performance of government-ordered tasks by banks? (The relevant articles from the Frankfurter Allgemeine Zeitung are attached).

Supplementary answer given by Mr de Silguy on behalf of the Commission (16 February 1998)

In October 1997 the Commission gave a provisional answer to the Honourable Member's written question ((OJ C 134, 30.4.1998, p. 27. )), pending the results of the examination of the issues by an expert group mandated by the Commission. The expert group has now issued its report and the Commission's preliminary view is to accept the report's conclusion and to favour the implementation of a standard of good practice recommended by the group in relation to bank charges for conversions.

The expert group's view is that banks are not legally entitled to charge their customer when there is an obligation imposed on the banks to make the conversions. This concerns conversions of incoming payments during the transitional period and conversion of accounts into the euro at the end of the transitional period.

As regards the conversion of national banknotes and coins into euro banknotes and coins during the final period, there appears to be no legal basis for imposing a general duty on banks to exchange without charges. There are however legal arguments entitling account holding customers to claim the exchange without charges of their national banknotes and coins. The standard of good practice recommended by the expert group include the conversion without charges for:

- incoming and outgoing payments during the transitional period;

- conversion of accounts from the national denominations into the euro denomination during and at the end of the transitional period;

- the exchange for account holders of 'household' amounts of banknotes and coins from the national denominations into the euro denomination during the final period.

In addition to the above, the Commission's preliminary opinion is that there are arguments for providing free of charges the conversion of national banknotes and coins into euro banknotes and coins during the final period also to citizens without a bank account.

The Commission will take a decision on its position on the standard to be implemented and the most appropriate initiatives after having heard the views of the participants in the round table of 26 February 1998.