Proposal for a COUNCIL REGULATION amending Regulation (EC) No 974/98 as regards the introduction of the euro in Lithuania
Date: 2014-06-04
Institutions: European Commission
Subjects: Euro Group (euro area), Lithuania, economic convergence, euro, monetary union













EUR-Lex - 52014PC0325 - EN











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52014PC0325

Proposal for a COUNCIL REGULATION amending Regulation (EC) No 974/98 as regards the introduction of the euro in Lithuania /* COM/2014/0325 final - 2014/0169 (NLE) */









EXPLANATORY MEMORANDUM
1.           CONTEXT OF THE PROPOSAL
On 4 June 2014, the Commission released a
proposal for a Council Decision in accordance with Article 140(2) of the Treaty
on the Functioning of the European Union (hereinafter the Treaty), indicating
that Lithuania fulfils the necessary conditions for the adoption of the euro
and that the derogation of Lithuania is abrogated with effect from 1 January
2015.
In case of a positive decision, the Council
will subsequently have to take the other measures necessary for the
introduction of the euro in Lithuania.
Council Regulation (EC) No 974/98 on the
introduction of the euro[1] governs the initial introduction of the euro
in the first wave euro-area Member States and Greece[2]. This Regulation was
amended by:
- The Regulation (EC) No 2169/2005, in order to
prepare for future enlargements of the euro area
- The Regulation (EC) No 1647/2006, in order to
cover Slovenia (which adopted the euro on 1 January 2007)
- The Regulation (EC) No 835/2007, in order to
cover Cyprus (which adopted the euro on 1 January 2008) 
- The Regulation (EC) No 836/2007, in order to
cover Malta (which adopted the euro on 1 January 2008) 
- The Regulation (EC) No 693/2008, in order to
cover Slovakia (which adopted the euro in January 2009)
- The Regulation (EU) No 670/2010, in order to
cover Estonia (which adopted the euro in January 2011)
- The Regulation (EU) No 678/2013, in order to
cover Latvia (which adopted the euro in January 2014).
In order for Lithuania to also be covered by
Regulation (EC) No 974/98, a reference to this Member State needs to be added
to this Regulation. The present proposal contains the necessary amendments to
this Regulation.
Lithuania's National
Euro Changeover Plan specifies that the so-called “big bang” scenario should be
applicable, i.e. that the adoption of the euro as the currency of Lithuania and the introduction of euro banknotes and coins in this Member State should coincide.
2.           RESULTS OF CONSULTATIONS
WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENT
The formal procedure following the Commission
proposal for a Council Decision involves consultation of the ECB. Discussions
with Member States on economic policy challenges in Member States are held
under various headings on a regular basis in the Economic and Financial
Committee and ECOFIN/Eurogroup. These include informal discussions on issues
specifically relevant to the preparation of eventual euro area entry (incl.
exchange rate policies). Dialogue with academics and other interested groups
takes place in the context of conferences/seminars and on an ad-hoc basis.
Economic developments in the euro area and the
Member States are assessed in the framework of the various procedures of
economic policy co-ordination and surveillance (notably under Art. 121 of the Treaty),
as well as in the context of the Commission’s regular monitoring and analysis
of country-specific and area-wide developments (incl. forecasts, regular
publication series, input to EFC and ECOFIN/Eurogroup). In accordance with the
proportionality principle and in line with past practice, the Commission
proposes not to develop a formal impact assessment.
3.           LEGAL ELEMENTS OF THE
PROPOSAL
3.1.        Legal basis
The legal basis for the present proposal is
Article 140(3) of the Treaty, which allows for the adoption of the other
measures necessary for the introduction of the euro in the Member State the derogation of which has been abrogated under Article 140(2) of the Treaty.
The Council shall act with the unanimity of the
Member States whose currency is the euro and the Member State concerned on a
proposal from the Commission and after consulting the ECB.
3.2.        Subsidiarity and
proportionality
The proposal falls under the exclusive
competence of the Union. The subsidiarity principle therefore does not apply.
The present initiative does not go beyond what
is necessary to achieve its objective and, therefore, complies with the
proportionality principle.
3.3.        Choice of the legal
instrument
The Regulation instrument is the only
appropriate legal instrument to amend Council Regulation (EC) No 974/98 on the
introduction of the euro.
4.           BUDGETARY IMPLICATION
The proposal has no implications for the budget
of the Union.
5.           COMMENTARY ON INDIVIDUAL
ARTICLES 
5.1.        Article 1
In accordance with Article 1 lit. (a) and with
Article 1a of Regulation (EC) No 974/98, the table in the Annex to that
Regulation lists the participating Member States and defines the euro adoption
date, the cash changeover date, and the “phasing-out” period, if applicable,
for all these Member States. According to Article 1 lit. (i) of Regulation (EC)
No 974/98, a "phasing-out" period can only apply to Member States
where the euro adoption date and the cash changeover date fall on the same day.
This was not the case for the eleven Member States which adopted the euro on 1
January 1999 and for Greece which adopted the euro on 1 January 2001. Slovenia,
Cyprus, Malta, Slovakia, Estonia and Latvia's euro adoption date and cash
changeover date coincided (1 January 2007 for Slovenia, 1 January 2008 for
Cyprus and Malta, 1 January 2009 for Slovakia, 1 January 2011 for Estonia, 1
January 2014 for Latvia), but the countries have chosen not to have a
"phasing-out" period. Also Lithuania's Euro National Changeover Plan
sets the same date for the euro adoption date and for the cash changeover date
(1 January 2015), while the country has chosen not to have a
"phasing-out" period.
This Article adds Lithuania and the following
relevant data for this Member State to the table in the Annex to Regulation (EC)
No 974/98 in protocol order.
 Member State || Euro adoption date || Cash changeover date || Member State with a "phasing-out" period 
 "Lithuania || 1 January 2015 || 1 January 2015 || No" 
5.2.        Article 2
This Article sets the date of entry into force
of the Regulation at 1 January 2015, ensuring that it will be applicable in
conformity with the timing of the other Council acts relating to the adoption
of the euro by Lithuania, i.e. the date of the abrogation of the derogation and
the date of the entry into force of the conversion rate of the Lithuanian litas.
2014/0169 (NLE)
Proposal for a
COUNCIL REGULATION
amending Regulation (EC) No 974/98 as
regards the introduction of the euro in Lithuania
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union, and in particular Article 140(3) thereof,
Having regard to the proposal from the
European Commission[3],
Having regard to the opinion of the
European Central Bank[4],
Whereas:
(1)       Council Regulation (EC) No
974/98[5]
provides for the substitution of the euro for the currencies of the Member
States which fulfilled the necessary conditions for the adoption of the euro at
the time when the Community entered the third stage of economic and monetary
union.
(2)       In accordance with Article
4 of the 2003 Act of Accession, Lithuania is a Member State with a derogation
as defined in Article 139(1) of the Treaty on the Functioning of the European
Union (hereinafter "the Treaty").
(3)       Pursuant to Council
Decision 2014/…/EU of … … 2014 on the adoption by Lithuania of the euro on
1 January 2015[6],
Lithuania fulfils the necessary conditions for the adoption of the euro and the
derogation in favour of Lithuania is to be abrogated with effect from
1 January 2015.
(4)       The introduction of the
euro in Lithuania requires the extension to Lithuania of the existing provisions
on the introduction of the euro set out in Regulation (EC) No 974/98.
(5)       Lithuania's National Euro
Changeover Plan specifies that euro banknotes and coins should become legal
tender in that Member State on the day of the introduction of the euro as its
currency. Consequently, the euro adoption date and the cash changeover date should
be 1 January 2015. No “phasing-out” period should apply.
(6)       Regulation (EC) No 974/98
should therefore be amended accordingly,
HAS ADOPTED THIS REGULATION:
Article 1
The
Annex to Regulation (EC) No 974/98 is amended in accordance with the Annex to
this Regulation.
Article 2
This Regulation shall enter into force on 1
January 2015.
This Regulation shall be binding
in its entirety and directly applicable in all Member States. 
Done at Brussels,
                                                                       For
the Council
                                                                       The
President
[1]               OJ L 139, 11.5.1998, p. 1. 
[2]               Cf. Council Regulation (EC) No 2596/2000 of 27
November 2000 amending Council Regulation (EC) No 974/98 on the introduction of
the euro (OJ L 300, 29.11.2000, p. 2).
[3]               OJ C […], […], p. […]
[4]               OJ C […], […], p. […].
[5]               Council Regulation (EC) No 974/98 of 3 May 1998 on
the introduction of the euro (OJ L 139, 11.5.1998, p. 1). 
[6]               OJ L […], […], p. […].