Opinion of the European Central Bank of 18 November 2005 at the request of Sveriges Riksbank on draft regulations on interest cost remuneration for cash that has been separated and stored under a special arrangement (CON/2005/48)
Date: 2005-11-18
Institutions: European Central Bank
Subjects: Sweden, cash-in-transit, interest, money, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 18 November 2005 

at the request of Sveriges Riksbank 

on draft regulations on interest cost remuneration for cash that has been separated and stored 

under a special arrangement 

(CON/2005/48) 

1. 

On 6 October 2005 the European Central Bank (ECB) received a request from Sveriges Riksbank 

for an opinion on draft Riksbank regulations on interest cost remuneration for cash that has been 

separated and stored under a special arrangement (hereinafter the ‘draft regulations’). 

2. 

The  ECB’s  competence  to  deliver  an  opinion  is  based  on  the  second  and  third  indents  of 

Article 2(1) of Council Decision 98/415/EC of 29 June 1998 on the consultation of the European 
Central Bank by national authorities regarding draft legislative provisions1, as the draft regulations 

concern  means  of  payment  and  Sveriges  Riksbank.  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. 

3. 

The  draft  regulations  contain  the  conditions  for  providing  interest  cost  remuneration  to 

undertakings which, either for themselves or on behalf of others, separate and store banknotes and 

coins. The remuneration is payable to defined depository owners that have entered into an interest 

cost  remuneration  agreement  with  Sveriges  Riksbank.  The  level  of  remuneration  is  based  on  the 

depository owners’ daily reports to Sveriges Riksbank on the nominal value of cash stored in the 

depository.  

4. 

Sweden is a Member State with a derogation and the ECB requirements regarding the organisation 

of  national  cash  cycles  in  Member  States  that  have  adopted  the  euro  do  not  currently  apply  to 

Sveriges Riksbank. However, since these requirements will apply to Sveriges Riksbank as soon as 

Sweden adopts the euro and Sveriges Riksbank becomes a fully integrated part of the Eurosystem, 

the  ECB  wishes  to  take  this  opportunity  to  indicate  the  status  of  cash  handling  within  the 

Eurosystem.  

1  

OJ L 189, 3.7.1998, p. 42. 

 
 
 
 
                                                      
5. 

In Opinion CON/2004/282, the ECB commented, inter alia, on a proposal to amend the Sveriges 

Riksbank Act by introducing a clarification that Sveriges Riksbank could carry out its tasks with 

regard to the distribution of banknotes and coins in cooperation with third parties. Moreover, the 

amendments  to  the  Sveriges  Riksbank  Act  included  an  enabling  provision  to  the  effect  that 

Sveriges Riksbank could compensate or provide credit free of charge to entities that separate and 

store  banknotes  and  coins  in  accordance  with  its  instructions.  The  draft  regulations  now  under 

consideration  are  intended  to  promote  the  separation  and  storage  of  cash  in  bank-owned  depots, 

which is expected to reduce the number of transports to Sveriges Riksbank and thereby make cash 

handling in Sweden more efficient and safer (due to the reduction of the risk of robbery). The ECB 

understands that the proposed interest cost remuneration from Sveriges Riksbank to the banks that 

separate and store banknotes is an essential incentive for these banks to open the depots and carry 

out this activity.  

6.  Within  the  Eurosystem,  Article  106  of  the  Treaty  establishing  the  European  Community  and 

Article  16  of  the  Statute  of  the  European  System  of  Central  Banks  and  of  the  European  Central 

Bank  attribute  to  the  ECB  and  the  national  central  banks  (NCBs)  of  the  Eurosystem  the  task  of 

issuing euro banknotes. This task is not limited to the act of putting euro banknotes into circulation, 

but  extends  to  any  act  which  has  a  bearing  on  the  circulation  of  banknotes.  When  fulfilling  this 

task,  Article  105(1)  of  the  Treaty  and  Article  2  of  the  Statute  require  the  Eurosystem  to  act  in 

accordance  with  the  principle  of  an  open  market  economy  with  free  competition,  favouring  an 

efficient  allocation  of  resources.  The  Eurosystem  is  currently  in  the  process  of  elaborating  and 

establishing  a  common  policy  regarding  various  responsibilities  of  the  NCBs  with  regard  to  the 

cash  cycle.  As  part  of  this  process,  existing  national  practices  concerning  the  issue  of  banknotes 

will be taken into account as far as possible, in accordance with Article 16 of the Statute, as will the 

principle of decentralisation, in accordance with Article 12.1 of the Statute. Article 12.1 provides 

that, to the extent deemed possible and appropriate, the ECB shall have recourse to the NCBs to 

carry  out  Eurosystem  operations.  The  elaboration  and  establishment  of  the  common  policy  must 

also  ensure  that  the  ability  of  an  NCB  to  carry  out  the  operations  forming  part  of  the  core  tasks 

assigned  to  the  Eurosystem  under  the  Treaty  will  not  be  undermined.  Consequently,  as  regards 

arrangements  similar  to  the  one  to be  introduced  in Sweden  by  the  draft  regulations,  the  guiding 

principle  is  that  within  the  Eurosystem,  it  must  always  be  ensured  (e.g.  by  regulatory  or  other 

effective  means)  that  the  central  bank  is,  and  remains,  in  a  position  to  perform  its  tasks,  in 

particular  to  ensure  the  smooth  and  efficient  supply  of  euro  banknotes  and  to  maintain  their 

integrity (including ensuring the quality and authenticity of euro banknotes in circulation), in line 

with the common Eurosystem policy currently established.  

7. 

Under Article 7 of the draft regulations, depository owners must carry out authenticity checks on 

all  cash  in  their  depositories  (other  than  new  cash).  The  ECB  understands  that  these  authenticity 

2  

ECB Opinion CON/2004/28 of 31 August 2004 at the request of Sveriges Riksbank on two draft legal acts amending the 
Sveriges Riksbank Act concerning certain matters related to the circulation of banknotes and coins. 

2 

                                                      
checks  concern  cash  in  its  capacity  as  balances  in  the  depositories,  and  that  Sveriges  Riksbank 

remains  the  authority  of  last  resort  for  authenticating  Swedish  banknotes.  Regarding  the 

Eurosystem, in December 2004 the Governing Council endorsed a Framework for the detection of 
counterfeits  and  fitness  sorting3.  Whilst  this  Framework  sets  out,  inter  alia,  certain  harmonised 

standards  on  authentication  and  fitness  checking  to  be  applied  by  credit  institutions  and  other 

professional  cash  handlers,  Article 106  of  the  Treaty  requires  the  Eurosystem  central  banks  to 

remain the authorities of last resort for authenticating euro banknotes. In the Eurosystem this task 

cannot  be  assigned  to  any  third  party  and  the  ECB  therefore  welcomes  the  fact  that  Sveriges 

Riksbank remains the authority of last resort for the authentication of Swedish banknotes. 

8. 

This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 18 November 2005. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

3  

‘Recycling of euro banknotes: Framework for the detection of counterfeits and fitness sorting by credit institutions and 
other professional cash handlers’, published in January 2005; available on the ECB’s website at www.ecb.int. 

3