Opinion of the European Central Bank of 12 June 2006 at the request of the Slovenian Ministry of Finance on a draft law on the introduction of the euro (CON/2006/29)
Date: 2006-06-12
Institutions: European Central Bank
Subjects: Slovenia, conversion rate, euro, monetary integration, money, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 12 June 2006 

at the request of the Slovenian Ministry of Finance 

on a draft law on the introduction of the euro 

(CON/2006/29) 

Introduction and legal basis 

On 12 May 2006 the European Central Bank (ECB) received a request from the Slovenian Ministry of 

Finance for an opinion on a draft law on the introduction of the euro (hereinafter the ‘draft law’). 

The  ECB’s  competence  to  deliver  an  opinion  is  based  on  Article  105(4)  of  the  Treaty  establishing  the 

European Community and on 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 Central Bank by national authorities regarding draft 
legislative provisions1, as the draft law relates to currency matters and means of payment. 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 

The main objectives of the draft law are to facilitate the euro changeover and to address the issues relating 

to the introduction of the euro that are not contained in the relevant Community legislation, i.e. Council 

Regulation  (EC)  No  1103/97  of  17  June  1997  on  certain  provisions  relating  to  the  introduction  of  the 
euro2, Council Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro3 and Council 

Regulation  (EC)  No  2866/98  of  31  December  1998  on  the  conversion  rates  between  the  euro  and  the 
currencies of the Member States adopting the euro4.  

2.  General observations 

2.1.  The  ECB  welcomes  the  draft  law  as  it  contains  a  comprehensive  set  of  provisions  for  the 

introduction  of  the  euro,  which  should  greatly  facilitate  a  smooth  changeover  to  the  euro  in 

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2  
3  
4  

OJ L 189, 3.7.1998, p. 42.  
OJ L 162, 19.6.1997, p. 1. Regulation as amended by Regulation (EC) No 2595/2000 (OJ L 300, 29.11.2000, p. 1).  
OJ L 139, 11.5.1998, p. 1. Regulation as last amended by Regulation (EC) No 2169/2005 (OJ L 346, 29.12.2005, p. 1). 
OJ L 359, 31.12.1998, p. 1. Regulation as amended by Regulation (EC) No 1478/2000 (OJ L 167, 7.7.2000, p. 1). 

 
 
 
 
 
                                                      
Slovenia. The Slovenian Government’s initiative of preparing early for the introduction of the euro 

should ensure the timely implementation of the necessary measures. 

2.2.  Name of the single currency 

The draft law that was submitted to the ECB for consultation uses the correct spelling5 of the name 

of the single currency in the nominative singular case and is therefore compatible with Community 
law in this respect6. Moreover, in the course of the consultation procedure, the consulting authority 

informed the ECB that a new provision would be inserted in the draft law providing that as from 

the day of entry into force of the draft law the word ‘evro’ in all grammatical cases will be replaced 

with  the  word  ‘euro’  in  the  relevant  case  in  laws  and  regulations.  The  ECB  welcomes  this  new 

provision, as it will satisfactorily solve the spelling issue in Slovenia. 

2.3.  Timing for adoption of the draft law and preconditions for its entry into force 

According  to  Article  28,  the  draft  law  ‘shall  enter  into  force  on  the  fifteenth  day  after  its 

publication and shall take effect from the day following the publication of the Council decision on 

abrogation of the derogation pursuant to Article 122(2) of the Treaty’. It should be recalled that the 

Community  has  exclusive  competence  in  matters  relating  to  economic  and  monetary  union,  and 

national legislation should not in any way prejudge the EU Council’s decision regarding abrogation 

of the derogation and the date on which this abrogation takes effect. Certain provisions of the draft 

law containing specific dates (e.g. Article 11(3), potentially Article 16 and indirectly Article 8(2)) 

presuppose that Slovenia will adopt the euro on 1 January 2007. However, in practice this should 

not cause any problems as the consulting authority has informed the ECB that the draft law will be 

submitted to the Slovenian Parliament after abrogation of the derogation. 

2.4.  Direct applicability of Community regulations 

Certain provisions of the draft law repeat the relevant provisions of Regulation (EC) No 974/987. In 

this  context,  the  ECB  notes  that  Article  249  of  the  Treaty  provides  that  a  Community  regulation 

‘shall  be  binding  in  its  entirety  and  directly  applicable  in  all  Member  States’.  A  Community 
regulation therefore does not need to be transposed into the domestic law of Member States8. If a 

Member State transposes a regulation into national law, the fact that the provision is a Community 

law provision  may be obscured. In addition, if a Member State transposes a regulation in even a 

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6  

7  

8  

The ECB understands that the spelling mistakes in Articles 21(2) and 22(1) of the draft law will be corrected. 
See: ECB Opinion CON/2005/57 of 16 December 2005 at the request of the Slovene Ministry of Economic Affairs on 
the provisions of the draft Companies Act concerning redenomination resulting from the introduction of the euro; ECB 
Opinion CON/2006/17 of 13 March 2006 at the request of the Slovenian Ministry of Finance on a draft law amending the 
Law on Banka Slovenije; and the ECB’s Convergence Report of May 2006, Chapter II, Section 5 and Subsection 7.2. 
Article  3  of  the  draft  law  repeats  Article  2  of  Regulation  (EC)  No  974/98;  Article  9(1),  Article  11(1)  and  (2),  and 
Article 13(1) of the draft law repeat Article 14 of Regulation (EC) No 974/98. 
As stated by the Court of Justice of the European Communities in Case 34-73 Fratelli Variola S.p.A. v Amministrazione 
italiana delle Finanze [1973] ECR 981: ‘by virtue of the obligations arising from the Treaty and assumed on ratification, 
Member  States  are  under  a  duty  not  to  obstruct  the  direct  applicability  inherent  in  regulations  and  other  rules  of 
Community  law.  Strict  compliance  with  this  obligation  is  an  indispensable  condition  of  simultaneous  and  uniform 
application  of  Community  regulations  throughout  the  Community’.  This  position  was  reiterated  in  Case  50-76 
Amsterdam Bulb BV v Produktschap voor Siergewassen [1977] ECR 137. 

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slightly different form, there is a risk that its content will be altered9. In light of the above, the ECB 

would  recommend  deleting  those  articles  of  the  draft  law  which  repeat  provisions  of 

Regulation (EC) No 974/98 or, alternatively, amending those articles to refer merely to the relevant 

provisions of Regulation (EC) No 974/98. 

3. 

Definitions  

3.1.  Conversion rate 

The definition of ‘convergence rate’ in Article 2 of the draft law refers to the Treaty establishing 

the  European  Community  published  in  the  Official  Gazette  of  the  Republic  of  Slovenia.  This 

definition should be amended to refer to the Official Journal of the European Union as only the text 

of the Treaty published there is deemed to be authentic. 

3.2.  Day of the introduction of the euro  

The definition of ‘day of the introduction of the euro’ in Article 2 of the draft law, which refers to 

Article  122(2)  of  the  Treaty,  does  not  comply  fully  with  Community  law.  Article  122(2)  of  the 

Treaty is the legal basis for the EU Council’s decision on abrogation of the derogation. Following 

this  decision,  and  in  accordance  with  Article  123(5)  of  the  Treaty,  the  EU  Council  adopts  the 

conversion rate between the euro and the currency of the relevant Member State and determines the 

date on which abrogation of the derogation will take effect. Therefore, the definition of ‘day of the 

introduction of the euro’ in Article 2 of the draft law should be amended by referring to it as the 

day  on  which  the  abrogation  of  Slovenia’s  derogation  takes  effect,  as  determined  by  the  EU 

Council in accordance with Article 122(2) of the Treaty. 

3.3.  Bottom-up method 

The bottom-up method is defined in Article 2 of the draft law as a ‘debt-redenomination method, 

whereby the value of each denomination of a debt security is redenominated’, and this is partially 

repeated in the last sentence of Article 12(1) of the draft law. For reasons of legal clarity, the ECB 
would advise deleting the repetition in Article 12(1) and defining the method in detail10 in Article 2 

of the draft law, which contains the definitions.  

4. 

Cash changeover  

4.1.  There appears to be a need to phrase Article 4(2) of the draft law more precisely. Currently, there 

seems to be a discrepancy between, on the one hand, the period of 14 days and, on the other hand, 

9  

10  

For  instance,  Article  13(3)  of  the  draft  law  clearly  contradicts  Article  14  of  Regulation  (EC)  No  974/98  and  should 
therefore be deleted. 
See  Commission  Communication  of  2  July  1997  on  the  impact  of  the  introduction  of  the  euro  on  capital  markets 
(COM(97) 337 final). 

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the period beginning at 00.00 on the day of the introduction of the euro and ending at 24.00 on the 

fourteenth day after the day of the introduction of the euro, which would mean a total of 15 days. 

4.2.  Article  6(1)  of  the  draft  law  provides  that  from  the  day  of  the  introduction  of  the  euro,  Banka 

Slovenije ‘shall start withdrawing tolar banknotes and coins from circulation’. From an operational 

point of view, the ECB would like to draw attention to the experience of past changeovers, where it 

proved very practical gradually to start withdrawing coins before the day of the introduction of the 

euro, to facilitate the logistics of this withdrawal (particularly given the bulk and weight of coins in 

circulation, the required special storage facilities, etc.). 

4.3. 

In  accordance  with  Article  6(2)  of  the  draft  law,  Banka  Slovenije  ‘may  adopt  an  executive 

regulation  laying  down  the  procedures  and  methods  for  the  cash  changeover’.  This  provision 

should be amended to state explicitly that any Banka Slovenije decision in this respect must be in 

accordance  with  decisions  taken  by  the  ECB’s  decision-making  bodies.Article  7  of  the  draft  law 

read in conjunction with Article 24 of the draft law leaves some room for different interpretations 

in relation to the cash changeover in post offices. The draft law refers to three different entities in 

this respect: Pošta Slovenije (a state-owned company providing postal services in Slovenia), Poštna 

banka  Slovenije  (a  bank  partially  owned  by  Pošta  Slovenije  for  which  the  latter  also  acts  as  the 

contractual  service  provider)  and  post  offices  (local  business  units  of  Pošta  Slovenije).  The  ECB 

would recommend clarifying whether ‘post offices’ in Article 24 refers to such local units of Pošta 

Slovenije  or,  if  they  do  not  have  separate  legal  personality,  whether  any  fines  incurred  would  be 

imposed  on  Pošta  Slovenije.  Since  Pošta  Slovenije  is  only  the  contractual  service  provider  for 

Poštna banka Slovenije, it may be appropriate that the latter be held responsible in the event of any 

infringement.  However,  if  this  is  the  case  Poštna  banka  Slovenije  is  already  included  in  the 

category of ‘banks’ under Article 24 of the draft law. 

4.4.  With respect to Article 8(2) of the draft law, the ECB would recommend specifying more clearly 

what the situation will be after 31 December 2016, i.e. Banka Slovenije will no longer exchange 

tolar coins and after that date any exchange claim against the Republic of Slovenia will be time-

barred. 

5. 

Account balances and payment transactions 

5.1.  For  reasons  of  legal  clarity,  the  ECB  would  recommend  stating  explicitly  that  ‘payment 

transactions’ in Article 10 of the draft law only refers to non-cash payments.  

5.2.  According to Article 12 of the draft law, debt securities of the state budget denominated in tolars 

and issued as book-entry securities in accordance with Slovenian law must be redenominated using 

the  bottom-up  method  and  the  minister  responsible  for  finance  will  prescribe  the  methods  and 

procedures  for  redenominating  individual  types  of  such  debt  securities.  The  ECB  would  suggest 

amending  this  provision  by  explicitly  stating  that  any  such  redenomination  must  comply  with 

Community law. 

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5.3.  According  to  Article  14(1)  of  the  draft  law,  ‘debtors  shall  be  responsible  for  the  accuracy of  the 

conversion into euro of amounts denominated in tolars at the time of payment or when submitting a 

payment order’, ‘unless otherwise agreed by the parties or provided for in a regulation’. According 

to  the  explanatory  memorandum  accompanying  the  working  version  of  the  draft  law  which  was 
made public at an earlier stage of the legislative process11, the intention behind this provision was 

to make clear that it is the debtor (and not the bank acting as payment intermediary) who will be 

responsible  for  the  accuracy  of  conversion  from  tolars  into  euro,  in  particular  as  regards  money 

orders issued before 31 December 2006 (when tolars are the only legal tender) and falling due after 

the introduction of the euro. In order to avoid any misunderstanding in interpreting the scope of this 

provision,  especially  in  the  light  of  Commission  Recommendation  98/287/EC  of  23  April  1998 
concerning  dual  display of  prices  and other  monetary  amounts12,  the  ECB  suggests  that  the  draft 

law  explicitly  specifies  that  relations  between  retailers  and  consumers  are  exempted  from 

Article 14(1). 

6. 

Interest rates, indices and exchange rates 

The  ECB  would  recommend  aligning Article  18  of  the  draft  law  with  Article  67  of  the  Law  on  Banka 
Slovenije13. In respect of foreign currencies that are on the ECB’s exchange-rate list, the exchange rates 

were previously determined by Banka Slovenije but will now only be published by Banka Slovenije (on 

the  basis  of  the  reference  exchange  rates  of  foreign  currencies  determined  and  published  by  the  ECB). 

Banka  Slovenije  may,  however,  still  determine  and  publish  the  reference  exchange  rates  for  foreign 

currencies that are not on the ECB’s exchange-rate list. 

7.  Other provisions on rounding 

7.1.  Article 21(2) of the draft law provides for an exception to the rule of rounding to no less than two 

decimal places: for lower-value prices and for goods and services that are sold in bulk ‘prices shall 

be rounded to no less than four decimal places’. Currently, there seems to be significant scope for 

different interpretations of when rounding to no less than four decimal places should be used, and 

the draft law only provides a few examples (such as prices for electricity units, telephone charges, 
etc.)14. For reasons of legal certainty, the draft law should contain more precise definitions of prices 

11  
12  
13  

14  

Available on the Slovenian Government website at www.gov.si. 
OJ L 130, 1.5.1998, p. 26. 
Zakon o Banki Slovenije, adopted on 19 June 2002 and last amended on 30 March 2006; published in the Official Gazette 
of the Republic of Slovenia, Nos 58/02, 85/02 and 39/06. 
Article 67(1) of the Law on Banka Slovenije reads: 
‘From the day of the introduction of the euro as the currency of the Republic of Slovenia, Articles 21 and 22 of this act 
shall cease to apply. Notwithstanding the preceding sentence, the Bank of Slovenia shall publish an exchange rate list on 
the basis of reference exchange rates of foreign currencies determined and published by the European Central Bank. The 
Bank of Slovenia may also determine and publish exchange rates of foreign currencies that are not on the exchange rate 
list of the European Central Bank.’ 
For the interpretation of the Court of Justice of the European Communities of the euro rounding rules, see Case C-19/03 
Verbraucher-Zentrale Hamburg eV v O2 (Germany) GmbH & Co. OHG [2004] ECR I-8183.  

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which ‘have lower values’ and of goods and services falling within the category of those ‘sold in 

bulk’. This is particularly important since the draft law15 provides for sanctions for infringements 

of this provision. 

7.2.  Article 22(1) of the draft law provides that, where there is dual pricing in accordance with the Law 

on dual pricing in tolars and euro, ‘undertakings may indicate prices to the nearest EUR 0.05 or to 

the nearest multiple thereof’, where goods and services are sold via automatic vending machines or 

by  similar  selling  methods  and  where,  for  technical  reasons,  it  is  not  possible  to  make  payments 

with an accuracy of EUR 0.01 and 0.02. The ECB understands that the rounding possibility set out 

in this provision: (i) refers to the actual price of the goods or services sold exclusively using the 

methods  mentioned  above;  (ii)  is  due  exclusively  to  the  technical  restrictions  of  the  vending 

machines in question; and (iii) is in any event without prejudice to the rounding rules in Council 

Regulation (EC) No 1103/97.  

8. 

Penal provisions 

With respect to Article 25 of the draft law, the ECB would like to make the following editorial comment. 

It seems that there is a discrepancy between the penal provision in point 5 of Article 25(1) (referring to 

infringements  of  Article  21(2))  and  the  wording  of  Article  21(2),  as  well  as  between  point  6  of 

Article 25(1) and the wording of the underlying provision (Article 21(5)). For reasons of legal clarity, the 

ECB would recommend aligning the wording of the penal provisions in points 5 and 6 of Article 25(1) of 

the draft law with their underlying provisions.  

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

Done at Frankfurt am Main, 12 June 2006. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

15  

Point 5 of Article 25(1) of the draft law.  

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