1999/98/EC: Council Decision of 31 December 1998 on the position to be taken by the Community regarding an agreement concerning the monetary relations with Vatican City
Date: 1998-12-31
Institutions: Council of the European Union
Subjects: European Central Bank, Holy See, agreement (EU), euro, monetary relations, monetary union

4. 2. 1999

EN

Official Journal of the European Communities

L 30/35

COUNCIL DECISION

of 31 December 1998

on the position to be taken by the Community regarding an agreement
concerning the monetary relations with Vatican City

(1999/98/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 109(3) thereof,

Having regard to the recommendation from the Commis-
sion,

Having regard to the opinion of the European Central
Bank,

(1) Whereas according to Council Regulation (EC) No
974/98 of 3 May 1998 on the introduction of the
euro (1)
the euro will be substituted as from 1
January 1999 for the currency of each participating
Member State at the conversion rate;

(2) Whereas the Community will have competence for
monetary and exchange
in the
Member States adopting the euro as from that date;

rate matters

(3) Whereas the Council is to determine the arrange-
ments for the negotiation and conclusion of agree-
ments concerning monetary or foreign exchange
regime matters;

(4) Whereas Italy has concluded an agreement with
Vatican City which includes provisions
on
monetary matters (2);

(5) Whereas the euro will be substituted for the Italian

Lira on 1 January 1999;

(6) Whereas according to Declaration (No 6) annexed
to the Final Act of the Treaty on European Union,
the Community undertakes to facilitate the renego-
tiations of existing arrangements with Vatican City
as might become necessary as a result of the intro-
duction of the single currency;

(7) Whereas the agreement between Italy and Vatican
City in its present form needs to be amended or, as
the case may be, replaced at the earliest possible
date, taking into account the allocation of compet-
ence
and
exchange rate matters as laid down in the Treaty;

to the Community

for monetary

(1) OJ L 139, 11. 5. 1998, p. 1.
(2) Convenzione monetaria tra la Repubblica Italiana e lo Stato

della Citt(cid:133) del Vaticano il 3 dicembre 1991.

(8) Whereas given the

economic

relations
close
between Vatican City and the Community, it is
appropriate that an agreement concerning bank-
notes and coins, the access to payment systems and
the euro in Vatican City is
the legal status of
concluded between the Community and Vatican
City; whereas given the historical
links between
Italy and Vatican City, it is appropriate that Italy
negotiates and may conclude the new agreement
on behalf of the Community;

(9) Whereas in order to allow Vatican City to have the
same currency as Italy, it is appropriate to agree
that Vatican City uses the euro as its official
currency and grants legal
tender status to euro
banknotes and coins
issued by the European
System of Central Banks and the Member States
which have adopted the euro;

(10) Whereas it is important that Vatican City ensures
that Community rules on banknotes and coins
denominated in euro are applicable in Vatican City;
whereas euro banknotes and coins need appropriate
protection against counterfeiting; whereas
is
important that Vatican City takes all the necessary
measures to combat counterfeiting and to co-
operate with the Community in this area;

it

(11) Whereas the European Central Bank (ECB) and the
national central banks may engage in all types of
banking transactions in relation to financial institu-
tions located in third countries; whereas the ECB
and the national central banks may, under appro-
priate conditions, allow financial
institutions in
third countries access to their payment systems;
whereas the agreement between the Community
and Vatican City shall not impose any obligations
on the ECB or on any national central bank;

(12) Whereas the Commission and the ECB in its field
of competence will have to be fully associated with
these negotiations; whereas it is appropriate that
Italy submits the draft agreement to the Economic
and Financial Committee for its opinion; whereas
the draft agreement will have to be submitted to
the Council in the case that the Commission or the
ECB or the Economic and Financial Committee
are of the opinion that this is necessary;

L 30/36

EN

Official Journal of the European Communities

4. 2. 1999

(13) Whereas the existing agreement between Italy and
Vatican City should be amended or, as the case
may be, replaced so as to avoid any inconsistencies
agreement
between such agreement
and Vatican City
between the Community
concerning their monetary relations,

and the

HAS ADOPTED THIS DECISION:

Article 1

Italy shall notify Vatican City of the need to amend the
existing agreement between Italy and Vatican City at the
earliest possible date as far as monetary matters are
concerned and offer negotiations for a new agreement.

Article 2

The position to be taken by the Community in the nego-
tiations with Vatican City for an agreement concerning
matters referred to below shall be based on the principles
laid down in Articles 3 to 6.

Article 3

Vatican City shall be entitled to use the euro as its

1.
official currency.

Vatican City shall be entitled to grant legal tender

2.
status to euro banknotes and coins.

Article 4

Vatican City shall undertake not to issue any banknotes,
coins or monetary surrogates of any kind unless the
conditions for such issuance have been agreed with the
Community. This does not prejudge the right of Vatican
City to continue issuing collector coins.

Article 5

1.
Vatican City shall undertake to make Community
rules on euro banknotes and coins applicable in Vatican
City.

Vatican City shall undertake to cooperate closely
2.
with the Community with regard to measures against
counterfeiting of euro banknotes and coins.

Article 6

Financial institutions located in Vatican City may have
access to payment systems within the euro area under
appropriate conditions to be determined with the agree-
ment of the European Central Bank.

Article 7

Italy shall conduct the negotiations with Vatican City on
the matters referred to in Articles 3 to 6 on behalf of the
Community. The Commission shall be fully associated
with the negotiations. The ECB shall be fully associated
with the negotiations in its field of competence. Italy
shall submit the draft agreement to the Economic and
Financial Committee for opinion.

Article 8

Italy shall be entitled to conclude the agreement on
behalf of the Community unless the Commission or the
ECB or the Economic and Financial Committee are of
the opinion that the agreement should be submitted to
the Council.

Article 9

Italy shall ensure that its existing agreement with Vatican
City is compatible with the agreement between the
Community and Vatican City concerning their monetary
relations.

Article 10

This Decision is addressed to the Italian Republic.

Done at Brussels, 31 December 1998.

For the Council

The President

R. EDLINGER