Opinion of the European Central Bank of 23 February 2010 on preparations for the introduction of the euro (CON/2010/16)
Date: 2010-02-23
Institutions: European Central Bank
Subjects: Estonia, euro, monetary integration, money, national law, payment system

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 23 February 2010  

on preparations for the introduction of the euro 

(CON/2010/16) 

Introduction and legal basis 

On  5  January  2010  the  European  Central  Bank  (ECB)  received  a  request  from  Estonia’s  Ministry  of 

Finance for an opinion on the draft law on introduction of the euro, the draft law on State fees and the 

draft amendments to the Commercial Code and other laws (hereinafter the ‘draft laws’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning of the European Union (TFEU) 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  Central  Bank  by  national 
authorities regarding draft legislative provisions1, as the draft laws relate 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. 

The ECB will also comment on the Law on the salaries of higher State officials2 adopted by the Riigikogu 

(Parliament) on 16 December 2009 that will enter into force on the date of commencement of authority of 

the composition No 12 of the Riigikogu, expected in March 2011.  

1.  

Purpose of the draft laws 

1.1   The  draft  laws  replace  amounts  in  kroons  with  amounts  in  euro,  specify  the  rounding  rules  and 

enter into force on the date that the derogation will be abrogated; some of the Commercial Code 

draft provisions will enter into force on 1 July 2010.  

1.2   The draft amendments to the Commercial Code accommodate the need to express amounts in euro 

on the one hand and the need to express amounts in evenly divisible integer numbers on the other 

hand.  The  draft  amendments  also  specify  that  before  the  derogation  is  abrogated,  amounts 

expressed in euro will be calculated in kroons based on the Eesti Pank rate and thereafter based on 

the  rate  established  by  the  EU  Council.  To  allow  time  for  undertakings  to  make  the  necessary 

adjustments,  monetary  indicators  that  are  important  from  the  point  of  view  of  undertakings’ 

activities may be expressed in euro from 1 July 2010. The general obligation to express all amounts 

only in euro enters into force one year after introduction of the euro. An additional aspect of the 

1  
2  

OJ L 189, 3.7.1998, p. 42.  
Riigi Teataja I, 7.1.2010, 1, 2.  

 
 
 
 
                                                 
amendments  to  the  Commercial  Code  is  the  introduction  of  no  par  value  shares  in  line  with  the 

Communication from the Commission of 2 July 1997 on the impact of the introduction of the euro 
on capital markets3.  

2. 

General observations  

2.1  The draft laws should refer to the TFEU which entered into force on 1 December 2009, instead of 

to the Treaty establishing the European Community.  

2.2  The draft laws comply with the principles of the introduction of the euro, according to which the 

EU  Council  decides  when  to  abrogate  the  derogation  of  a  Member  State  according  to 

Article 140(2) of the TFEU and the conversion rate will be set amending 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 on the basis of Article 140(3) TFEU. 

2.3  The ECB has already noted that the official redenomination should only take place on the basis of 
the  conversion  rate  fixed  according  to  Article  140(3)  of  the  TFEU5.  However,  the  ECB  has 

accepted that national legal provisions containing amounts in euro may enter into force before that 
if the Law refers to an amount in national currency equivalent to EUR [X]6. In the case of the draft 

amendments  to  the  Commercial  Code,  the  possibility  of  expressing  amounts  in  euro  before  the 

abrogation of the derogation is in line with this approach. 

2.4  The ECB notes that the draft amendments to the Commercial Code allow for the continued limited 

use  of  the  legacy  currency  after  the  euro  adoption  date.  This  would,  however,  require  the 

application  of  a  ‘phasing-out’  period  under  Article  9a  of  Council  Regulation  (EC)  No  974/98  of 
3 May  1998  on  the  introduction  of  the  euro7.  If  this  Regulation  is  amended  with  a  view  to  the 

introduction of the euro in Estonia, its annex will need to provide that Estonia is a Member State 

with a phasing-out period. 

2.5  The  draft  law  on  State  fees  expresses  all  fees  in  euro  and  rounds  the  amounts  to  the  nearest 

complete  cent.  This  is  intended  to  cover  the  costs  underlying  the  services  and  is  based  on  the 

current exchange rate of the central bank. The eventual balance between the costs underlying the 

services and the fees to be paid will depend on the final conversion rate that will be set amending 

Regulation (EC) No 2866/98. 

2.6  Rounding  rules  for  the  euro  introduction  preparations  are  set  out  in  Articles  4  and  5  of  Council 

Regulation (EC) No 1103/97 of 17 June 1997 on certain provisions relating to the introduction of 
the euro8. The draft laws further specify these rules while staying within the scope of these articles.  

3  
4  
5  

6  
7  
8  

COM(97) 337 final, not published in the Official Journal. 
OJ L 359, 31.12.1998, p. 1. 
Paragraph  3.3  of  ECB  Opinion  CON/2006/28.  All  ECB  opinions  and  reports  are  available  on  the  ECB’s  website  at 
www.ecb.europa.eu. 
Paragraph 5.1 of ECB Opinion CON/2007/83. 
OJ L 139, 11.5.1998, p. 1. 
OJ L 162, 19.6.1997, p. 1. 

2 

 
 
                                                 
2.7  The ECB welcomes timely preparations for the introduction of the euro. The ECB also welcomes 

the repeal of the Law on currency and the Law on the security of kroons which did not comply with 
the requirements for legal integration into the Eurosystem9.  

3.   Draft law on the introduction of the euro 

3.1  The draft law on the introduction of the euro specifies the methodology for converting kroons to 

euro.  According  to  Article  4(3)  of  Regulation  (EC)  No  1103/97,  inverse  rates  must  not  be  used. 

However, the conversion rates must be used for conversions either way between the euro unit and 

the  national  currency  units.  To  avoid  any  misunderstanding  concerning  the  conversion 

methodology, it might be useful to follow in Article 224 of the draft law on the introduction of the 

euro  the  order  of  the  wording  of  Article  4(3);  that  is  conversion  rates  will  be  used  ‘between  the 
euro unit and the national currency units’10. 

3.2  As explained by the consulting authority, the obligation set out in Article 222 of the draft law on 

the introduction of the euro is relevant for persons not specified in Article 2. As another point, the 

ECB notes that Article 223(2) should specify a period rather than a point in time for removal of the 

national currency from circulation.  

4. 

The Law on the salaries of higher State officials 

4.1  The Law on the salaries of higher State officials sets in euro the highest rate of salary and specifies 

coefficients applicable to the salaries for different posts. The Law also specifies that these rates in 

euro will be calculated in kroons based on the central rate of Eesti Pank and that the Law enters 

into force with the next composition of Riigikogu, which can be expected in March 2011.  

4.2  National  authorities  have  the  obligation  to  consult  the  ECB  on  draft  legislative  provisions 

concerning matters that fall within its competence. Currency matters are expressly listed among the 
areas  of  the  ECB’s  competence11.  According  to  Article  4  of  Decision  98/415/EC,  each  Member 

State must ensure that the ECB is consulted at an appropriate stage enabling the authority initiating 

the  draft  legislative  provision  to  take  into  consideration  the  ECB’s  opinion  before  taking  its 

decision on the substance. This obligation was not fulfilled in respect of the Law on the salaries of 

higher State officials. 

4.3  The currency of a Member State with a derogation is its national currency until the entry into force 

of the Council decision abrogating the derogation under Article 140(2) TFEU. National provisions 

may only contain amounts in euro either when the euro is referred to as a foreign currency or where 
it is necessary due to the transposition of Union law provisions expressed in euro12. Neither of these 

conditions are present here, and the Law does not comply with the principles of the introduction of 

9  
10  
11  
12  

Convergence Report May 2008, p. 40. 
A similar comment applies also in respect of the draft Article 5253(1) of the Commercial Code. 
First indent of Article 2(1) of Decision 98/415/EC. 
Paragraph 5.1 of ECB Opinion CON/2007/43. 

3 

 
 
 
                                                 
the euro. Therefore, the ECB recommends amending this Law in line with the techniques applied to 

the draft laws as described above.  

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

Done at Frankfurt am Main, 23 February 2010. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

4