Opinion of the European Central Bank of 7 March 2011 on the recirculation of euro banknotes (CON/2011/19)
Date: 2011-03-07
Institutions: European Central Bank
Subjects: France, euro, money, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 7 March 2011 

on the recirculation of euro banknotes  

(CON/2011/19) 

Introduction and legal basis 

On  31  January  2011,  the  European  Central  Bank  (ECB)  received  a  request  from  the  Governor  of  the 

Banque de France for an opinion on a draft decree amending Articles R.122-7 to R.122-11, R.123-3 and 

R.162-5  of  the  French  Monetary  and  Financial  Code  (hereinafter  the  ‘draft  Decree’)  and  on  a  draft 

decision  of  the  Governor  of  the  Banque  de  France  on  the  legal  framework  for  the  recycling  of  euro 

banknotes (hereinafter the ‘draft Decision’). On 16 February 2011, the ECB received a revised version of 

the draft Decision, which cancels and replaces the former one. 

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  and  the  first,  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  Decree  and  the  draft  Decision  concern 

currency matters, means of payment and the Banque de France. 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 Decree and draft Decision 

1.1  The  draft  Decree  will  adapt  the  provisions  of  the  French  Monetary  and  Financial  Code  on  the 
recirculation of euro banknotes2 to the new harmonised legal framework applying in the Member 

States whose currency is the euro. This framework is established by Decision ECB/2010/14 of 16 
September 2010 on the authenticity and fitness checking and recirculation of euro banknotes3. The 

draft  Decree  will  transfer  full  responsibility  for  the  implementation  of  agreements  to  be  signed 

between cash handlers and the Banque de France in the context of this new legal framework to the 

Banque de France. It therefore deletes most of the provisions concerning standard agreements to be 

signed between cash handlers and the Banque de France, including the requirement for the standard 

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OJ L 189, 3.7.1998, p. 42.  
Articles R.122-7 to R.122-11, R.123-3 and R.162-5 of the French Monetary and Financial Code. 
OJ L 267, 9.10.2010, p. 1. 

 
 
 
 
                                                 
agreements  to  be  approved  by  a  decree  of  the  Minister  for  Economic  Affairs,  Finance  and 
Industry4, while maintaining the requirement for cash handlers to sign agreements with the Banque 

de  France  as  a  prior  condition  to  the  recirculation  of  euro  banknotes.  In  this  respect,  the  draft 

Decree  provides  that,  where  credit  institutions,  La  Poste  and  payment  institutions  plan  to  supply 

automated  teller  machines  with  euro  banknotes  that  have  not  been  directly  obtained  from  a 

Eurosystem central bank, they must first enter into an agreement with the Banque de France and 

respect  the  rules  enacted  by  the  Banque  de  France  in  accordance  with  those  laid  down  by  the 
European Central Bank5. 

1.2 

In this context, the draft Decision6 mainly specifies the standard agreements7 to be signed between 
cash handlers and the Banque de France, updating currently existing standard agreements8. 

2. 

General observations 

2.1  As Decision ECB/2010/14 applies to cash handlers by virtue of Article 6(1) of Council Regulation 

(EC) No 1338/2001 of 28 June 2001 laying down measures necessary for the protection of the euro 
against  counterfeiting9,  which  refers  to  procedures  defined  by  the  ECB  for  checking  euro 

banknotes, there is no strict need to implement Decision ECB/2010/14 into French law. However, 

the  ECB  understands  that  the  binding  legal  framework  for  the  recirculation  of  euro  banknotes 
already existing in France10 has to be aligned with Decision ECB/2010/14. 

2.2  The ECB welcomes in this context the amendments introduced by the draft Decree leading to the 

implementation of the standard agreements between cash handlers and the Banque de France under 

the  sole  responsibility  of  the  Banque  de  France.  The  requirement  for  cash  handlers  to  sign  these 
agreements with the Banque de France as a prior condition to the recirculation of euro banknotes11 

is  maintained,  despite  the  direct  imposition  by  Decision  ECB/2010/14  of  obligations  on  cash 

handlers. The ECB acknowledges that this aims at fostering compliance of cash handlers in France 

with  the  rules  and  procedures  laid  down  in  Decision  ECB/2010/14.  In  this  respect,  the  ECB 

welcomes the draft Decree and the draft Decision and is confident that this updated national legal 

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Under the current provisions, and in particular Article R122-11 of the French Monetary and Financial Code, which the 
draft Decree will delete. 
Article R122-9 of the French Monetary and Financial Code as proposed by the draft Decree. 
The  draft  Decision  is  to  be  adopted  on  the  basis  of  Article  L.142-8  of  the  French  Monetary  and  Financial  Code,  as 
recently amended, which now entitles the Governor of the Banque de France not only to transpose ECB Guidelines, but 
also to implement ECB decisions and other ECB legal acts. 
Standard agreement regarding the distribution through automated teller machines of banknotes not directly obtained from 
one of the Eurosystem’s central banks, standard agreement regarding the handling operations of euro banknotes by credit 
institutions or payment institutions with a view to their issue to the public through automated teller machines, standard 
agreement regarding the handling operations of euro banknotes by the service providers of credit institutions or payment 
institutions with a view to their issue to the public through automated teller machines. 
See Ministerial Order of 20 June 2005 approving the current version of the template agreements, Journal Officiel de la 
République française, 16.7.2005. 
OJ L 181, 4.7.2001, p. 6. Article 6(1) was amended on 18 December 2008 (OJ L 17, 22.1.2009, p. 1). 
The ECB had been consulted in 2004 on the legal framework for the recycling of euro banknotes in France and adopted 
Opinion CON/2004/8. 
Article R122-9 of the French Monetary and Financial Code as proposed by the draft Decree. 

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framework  will  contribute  to  the  preservation  of  euro  banknotes  in  circulation  and  to  the 

maintenance of public confidence in euro banknotes. 

2.3 

In  addition,  the  ECB  underlines  the  importance  of  harmonised  standards  on  euro  banknote 

recirculation across the Member States whose currency is the euro. The ECB considers it essential 

for  any  national  implementing  measures  to  implement  Decision  ECB/2010/14  strictly  and  to  not 

deviate  from  the  common  rules  established  under  this  Decision,  except  when  expressly  provided 

for  in  the  Decision.  Moreover,  national  implementing  measures  should  clarify  the  primacy  and 

direct  applicability  of  the  Union  legislation  on  the  authenticity  and  fitness  checking  and 

recirculation of euro banknotes to be complied with by cash handlers. In this context, in order to 

ensure the  consistency of national implementing  measures with  Decision ECB/2010/14, the ECB 

favours  the  use  of  direct  references  to  Decision  ECB/2010/14,  including  its  technical  annexes. 

Alternatively, reproduction of the relevant provisions of Decision ECB/2010/14 without additions 

is also acceptable. The ECB notes that while the draft Decision contains the necessary references to 

Decision ECB/2010/14 and generally reproduces the relevant provisions of Decision ECB/2010/14, 
subject to the specific observations in Section 3 below, the draft Decree could clarify further12 the 

direct applicability of ECB rules to cash handlers, such rules applying by virtue of Article 6(1) of 

Council Regulation (EC) No 1338/2001, which makes implementation of these rules into national 

law not strictly necessary from a legal point of view. 

3. 

Specific observations 

3.1  Pursuant to Article 6 of the standard agreement set out in Annex I and Article 10 of the standard 

agreement  set  out  in  Annex  II  to  the  draft  Decision  (sanctions),  the  Banque  de  France  may  take 

measures with immediate effect against cash handlers that do not comply with the rules laid down 

in the respective standard agreement where there is a risk that category A or category 2 banknotes 

are put back into circulation. First, there should be a clear definition of these categories A and 2; a 

reference to  Annexes IIa  and IIb of Decision ECB/2010/14 would provide clarity in this respect. 

Second, euro banknotes not clearly authenticated (category 3), which, according to ECB rules, have 

to  be  withdrawn  from  circulation  and  handed  over  to  the  competent  national  authorities,  should 

also be mentioned in Article 6, and respectively Article 10, of the standard agreements set out in 

Annexes I and II of the draft Decision, together with category A and 2 banknotes, as they present a 
risk that counterfeit banknotes are put back into circulation13. 

3.2  Article 7.4 of the standard agreement set out in Annex II to the draft Decision requires particular 

cash  handlers  to  report  statistical  data  to  the  Banque  de  France  on  a  monthly  basis.  Pursuant  to 

Annex IV to Decision ECB/2010/14, such data should be reported to a national central bank (NCB) 

on a six-monthly basis. NCBs may ask for monthly reporting for a transitional period only, where 

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In Article R122-9 of the French Monetary and Financial Code resulting from the draft Decree. 
Banknotes not clearly authenticated are already part of category A referred to in Annex IIb of Decision ECB/2010/14. 

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this was the practice of such NCB prior to Decision ECB/2010/14 entering into force. The current 

wording of Article 7.4 may however be interpreted as meaning that the monthly reporting is of a 

permanent nature for the cash handlers concerned, which is not in line with Decision ECB/2010/14. 

The temporary nature of such monthly reporting should be clarified. 

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

Done at Frankfurt am Main, 7 March 2011. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

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