Opinion of the European Central Bank of 12 January 2024 on the phasing out of the 1 000 Danish kroner banknote and the lowering of the cash prohibition limit (CON/2024/2)
Date: 2024-01-12
Institutions: European Central Bank
Subjects: legal basis, money

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 12 January 2024 

on the phasing out of the 1 000 Danish kroner banknote 

and the lowering of the cash prohibition limit  

(CON/2024/2) 

Introduction and legal basis 

On 1 December 2023, the European Central Bank (ECB) received two requests from the Danish Ministry 

of Business (Erhvervsministeriet) for an opinion on a draft executive order on Danmarks Nationalbank’s 

withdrawal of certain banknotes (hereinafter the ‘draft executive order’)1 and a draft law amending the Law 

on measures to prevent money laundering and the financing of terrorism (hereinafter the ‘draft law’)2.  

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 second and third indents of Article 2(1) of Council Decision 

98/415/EC3, as the draft executive order and the draft law relate to Danmarks Nationalbank 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 executive order and the draft law 

1.1.  The  purpose  of  the  draft  executive  order  is  to  phase  out  and  withdraw  old  Danish  kroner  (DKK) 

banknotes issued from 23 July 1945 until 23 May 2011 from the 1944, 1952, 1972 and 1997 series, 

together with the 1 000 DKK banknote from the 2009 series, all of which will cease to have legal 

tender  status  after  31  May  20254.  After  the  withdrawal  of  these  banknotes,  they  may  still  be 

redeemed by Danmarks Nationalbank for an additional year, up until and including 31 May 2026. 

After this date, Danmarks Nationalbank may redeem the banknotes where circumstances justify it5. 

The draft executive order enters into force on 1 January 2024. 

1.2  The phasing out and withdrawal of the old DKK banknote series is done with a view to issuing a new 

future banknote series based on state-of-the-art technologies to prevent counterfeits6. In this respect, 

all existing Danish banknote denominations (500 DKK, 200 DKK, 100 DDK and 50 DKK) will be part 

1  
2  
3  

4  
5   

6  

Bekendtgørelse om Danmarks Nationalbanks indkaldelse af visse pengesedler, BEK nr. 1706 af 11/12/2023. 
Forslag til lov om ændring af hvidvaskloven.  

Council  Decision  98/415/EC  of  29 June  1998  on  the  consultation  of  the  European  Central  Bank  by  national  authorities 
regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42). 

See Section 1(1) and(2) of the draft executive order.  
See  Section  2(1)  and(2)  of  the  executive  order.  See  also  Section  8(3)  of  the  Law  on  Danmarks  Nationalbank  (Lov  om 
Danmarks Nationalbank, Lov nr. 116 af 7.4.1936), which likewise regulates an additional redemption period of 12 months 
after the period where a withdrawn banknote loses its status as legal tender. Subsequent to this additional 12 month period, 
Danmarks Nationalbank may still redeem banknotes which are no longer legal tender ‘if circumstances justify it’.  
See Danmarks Nationalbank’s report ‘The role of cash in a society with low usage of cash’, November 2023, page 43.  

 
 
 
 
 
ECB-PUBLIC 

of the new series except for the 1 000 DKK banknote, which is currently the highest denomination 

banknote  in  Denmark.  According  to  the  explanatory  notes  to  the  draft  law7,  which  also  include 

explanations  to  the  draft  executive  order  (hereinafter  the  ‘explanatory  notes’),  Danmarks 

Nationalbank  has,  based  on  the  Law  on  Danmarks Nationalbank8  and  with  the  permission  of  the 

Minister for Business, decided to phase out the 1 000 DKK banknote with a view to withdrawing it 

altogether. In this respect, Danmarks Nationalbank is of the view that the 1 000 DKK banknote is not 

necessary for Danish citizens and businesses to carry out safe and efficient payments. This is inter 

alia  reflected  by  the  generally  reduced  use  of  cash  in  Denmark,  with  the  vast  majority  of  cash 

payments amounting to less than 500 DKK. According to the explanatory notes, this is also based 

on the fact that the 1 000 DKK banknote, to a higher degree than other Danish banknotes, represents 

an increased risk of being used for criminal purposes9.   

1.3  The  purpose  of  the  draft  law  is  to  lower  the  existing  threshold  for  certain  cash  payments  to 

professionals from a maximum of 20 000 DKK to 15 000 DKK. The draft law enters into force on 1 

March 2024.  

1.4  The lowering of the threshold for certain cash payments applies to professionals who are not covered 

by the scope of application of the Law on measures to prevent money laundering and financing of 

terrorism10 (hereinafter the ‘Law on money laundering’) when receiving cash, and therefore only to 

this specific group of business-to-business and customer-to-business payments. According to the 

explanatory  notes11,  all  businesses  receiving  cash  will,  until  the  phasing  out  of  the  1  000  DKK 

banknote, be extraordinarily exposed to an increased risk of being misused for money laundering 

purposes12. However, the enhanced restriction on the cash limitation prohibition applies to all cash 

payments,  and  not  only  payments  in  connection  with  the  withdrawal  of  the  1  000  DKK  note13. 

According to the explanatory notes, while the lowering of the threshold is seen to generally have a 

positive effect for the fight against money laundering14, the lowering of the threshold may also entail 

certain  impediments  for  persons  with  legitimate  cash  holdings  wanting  to  use  their  holdings  of 

withdrawn notes in retail trades15.  

1.5  According to the explanatory notes16, the cash prohibition limit complies with Directive (EU) 2015 

2015/849 of the European Parliament and of the Council17, according to which Member States may 

make additional general limitations to the use of cash. 

7  
8  

9  

10  

11  
12  
13  
14  
15   
16  
17  

See point 1 of the general comments to the draft law.  
According to Section 8(3) of the Law on Danmarks Nationalbank, where the Minister of Business gives his permission, notes 
may be withdrawn and shall then cease to be legal tender from the date which might be fixed by ordinance from the Minister 
for Business. After the expiration of twelve months from this date, the withdrawn notes shall lose validity as against Danmarks 
Nationalbank,  provided  that  Danmarks  Nationalbank  shall  have  the  right  to  redeem  the  notes  also  after  this  time,  if 
circumstances justify it.  
See  point  1  of  the  general  comments  to  the  draft  law  and  Danmarks  Nationalbank’s  report  ‘The  future  of  Danish  cash’, 
November 2023, page 4.  
Lov om forebyggende foranstaltninger mod hvidvask og finansiering af terrorisme, lovbekendtgørelse nr. 316 af 11. marts 
2022, som senere ændret.  
See points 1 and 1.1.2 of the general comments to the draft law. 
See point 1 of the general comments to the draft law. 
See number 1 of the specific comments to the draft law. 
See points 1 and 1.1.2 of the general comments to the draft law. 
See point 5 of the general comments to the draft law. 
See point 8 of the general comments to the draft law. 
See recital 6 of Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of 
the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 
648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European parliament and 
of the Council and Commission Directive 2006/70/EC (OJ, L 141, 5.6.2015, p.73).  

2 

 
ECB-PUBLIC 

2. 

General observations  

2.1  Denmark  is  exempted  from  participating  in  the  third  stage  of  the  Economic  and  Monetary  Union, 

pursuant to the Protocol (No 16) of the Treaty on the Functioning of the European Union (TFEU) on 

certain provisions relating to Denmark. As for any abrogation of the exemption, the procedure set 

out in Article 140 TFEU will only be initiated at Denmark’s request18. Therefore, in accordance with 

Protocol (No 16) and Articles 139(2), point (d) TFEU, Article 128 TFEU, which states that the euro 

banknotes issued by the ECB and the national central banks (NCBs) shall be the only such notes to 

have  status of  legal  tender within  the Union,  is not  applicable  to  Denmark19.  Against  this specific 

institutional backdrop, the ECB has prepared an assessment of the relevant provisions of the draft 

executive order and the draft law against relevant practices in the euro area, in particular the legal 

requirements for the euro and the legal tender status of euro banknotes. 

2.2  The ECB understands that the draft executive order and the draft law have been influenced by a 

recent report of Danmarks Nationalbank on the role of cash in a society with low usage of cash. In 

this context, Danmarks Nationalbank notes that cash in recent decades has played a decreasing role 

for Danish citizens and business20. The relative decline in cash usage for payments and savings is 

seen  by  Danmarks  Nationalbank  as  a  natural  development  in  the  light  of  Danes’  willingness  to 

embrace new digital payment solutions combined with, at the same time, the digitisation of Danish 

society. This is also the case for numerous public and private initiatives to accelerate digitalisation. 

According to Danmarks Nationalbank, the decline in the use of cash has meant a general decline in 

the  demand for cash,  and the development in cash usage for payments also suggests that more 

people  will  live  without  cash  in  the  future.  This  is  seen  by  Danmarks  Nationalbank  to  have 

consequences for the role of cash in Danish society, and has already resulted in major changes to 

the  cash  infrastructure  and  the  need  to  continually  adopt  legislation  on  the  use  of  cash  for 

payments21.  

2.3 

In terms of the decline in cash usage more specifically, the total value of cash payments in Denmark 

has decreased from approximately 10 % of the total value of all payments in 2021 to less than 8 % 

in 202322. Moreover, in physical trade, the proportion of payments made with cash was 11 % of the 

total amount of payments in 2023, which is understood to be equivalent to the level in 2021. However, 

the ECB understands that this should be seen in the context of physical trade in Denmark, which 

accounts for an increasingly small share of the total number of payments due to the shift towards 

more online trade and ever more in-app payments on mobile phones. Moreover, it is noted that the 

total  value  of  DKK  banknotes  and coins  in  circulation  has  remained  stable  since  2017,  and even 

increased by around 10 % at the onset of the coronavirus (COVID-19) pandemic in 202023. To the 

ECB,  this  points  to  the  relevance  of  physical  central  bank  money,  notably  banknotes,  during 

situations of financial stress, but also for in-person payments at the point of sale.   

18  
19  
20  
21   
22  
23  

See paragraph 2 of Protocol (No 16) of the TFEU on certain provisions relating to Denmark. 
See paragraph 3.2 of Opinion CON/2019/5. All ECB opinions are published on EUR-Lex. 
See Danmarks Nationalbank, ‘The role of cash in a society with low usage of cash’, November 2023, p. 4. 
See Danmarks Nationalbank, ‘The role of cash in a society with low usage of cash’, November 2023, p. 6. 
See Danmarks Nationalbank, ‘The role of cash in a society with low usage of cash’, November 2023, p. 6. 
See Danmarks Nationalbank, ‘The role of cash in a society with low usage of cash’, p. 14, Chart 8. 

3 

 
 
ECB-PUBLIC 

2.4  The statements on the role of cash in Danish society, as expressed in the explanatory notes, contrast 

with the ECB’s views on the role of cash in society. The ECB considers that cash continues to play 

an  important  role  in  society  irrespective  of  the  fact  that  electronic  payment  instruments  are 

increasingly  used  for  retail  payments  in  Member  States,  including  Denmark24.  Cash  is  generally 

appreciated as a payment instrument because it is widely accepted, fast and facilitates control over 

the  payer’s  spending.  It  is  currently  the  only  payment  instrument  that  allows  citizens  to  settle  a 

transaction  in  central  bank  money,  which  is  also  settled  instantly25,  while,  importantly,  ensuring 

privacy. Moreover, it does not carry the legal possibility of imposing a fee for the use thereof. Cash 

can play an important role in the event of contingencies, such as Hurricane Katrina in the U.S. in 

2005, where alternative means of payment are temporarily not functioning26 and it is robust against 

cyber-crime27,  since  cash  payments  do  not  require  a  functional  technical  infrastructure  or  related 

investment but are always available. Furthermore, cash payments are not subject to daily or weekly 

payment limits set by entities providing underlying payment services28. In addition, cash payments 

also facilitate the inclusion of the entire population in the economy by allowing citizens to settle a 

wide range of payment transactions in this way, thus ensuring freedom of choice as to the method 

of  payment  for  all  citizens29.The  ability  to  pay  in  cash  remains  particularly  important  for  all  those 

citizens who, for various legitimate reasons, prefer to use cash due to its unique features, rather than 

other  payment  instruments.  Also,  cash  remains  important  especially  for  those  who  do  not  have 

access  to  the banking system and electronic means of  payments. These groups include not only 

elderly people, but also some disabled citizens, immigrants, socially vulnerable citizens, minors and 

others  with  limited  or  no  access  to  digital  payment  services30.  The  ECB  surveys  biennially  the 

payment habits in the euro area which revealed that around 60 % of the euro area citizens want to 

have the freedom to also use cash at the point of sale. Finally, a critical mass of cash in circulation 

is necessary to maintain the business case for third parties involved in the cash cycle. Thus, any 

further cash payment limitation or suppression of a denomination could lead to a situation where the 

unit  costs  of  cash  deter  third  parties  from  supplying  cash  any  longer  and,  as  a  consequence, 

endanger the contingency feature of cash, if the cash infrastructure and suppliers were to disappear 

altogether or would be insufficient to cater for an unexpected surge in cash demand.  

2.5  These  characteristics  of  cash  are  also  acknowledged  by  the  European  Commission  in  its  Retail 

Payments Strategy which, while promoting the emergence of digital payments to offer more options 

24   
25  

26  

27  

28   
29  

30  

See paragraph 2.4 of Opinion CON/2017/8 and paragraph 2.4 of Opinion CON/2020/33.  

See  paragraph  2.4  of  Opinion  CON/2017/8,  paragraph  2.1  of  Opinion  CON/2019/41,  paragraph  9.2.1  of  Opinion 
CON/2020/13,  paragraph  2.3  of  Opinion  CON/2020/21,  paragraph  7.2.1  of  Opinion  CON/2021/9,  paragraph  2.1  of 
CON/2021/18, paragraph 2.1 of Opinion CON/2023/7, paragraph 2.1 of Opinion CON/2023/13 and paragraph 2.1 of Opinion 
CON/2023/39.  

See  paragraph  2.1  of  Opinion  CON/2019/41,  paragraph  9.2.1  of  Opinion  CON/2020/13,  paragraph  7.2.1  of  Opinion 
CON/2021/9, paragraph 2.3 of Opinion CON/2021/18 and paragraph 2.1 of Opinion CON/2023/39. 

See  paragraph  2.2  of  Opinion  CON/2021/32,  paragraph  2.1.1  of  Opinion  CON/2023/33  and  paragraph  2.1  of  Opinion 
CON/2023/39. 
See paragraph 2.1 of Opinion CON/2023/39. 

See  paragraphs  2.4  and  3.1  of  Opinion  CON/2017/8,  paragraph  2.7  of  Opinion  CON/2017/40,  paragraph  2.6  of  Opinion 
CON/2019/4,  paragraphs  2.1  to  2.3  of  Opinion  CON/2021/18,  paragraph  7.2.1  of  Opinion  CON/2021/9,  paragraph  2.3  of 
Opinion CON/2021/38, paragraph 2.1 of Opinion CON/2023/13, paragraph 2.1 of Opinion CON/2023/13 and paragraph 2.1 
of Opinion CON/2023/39.   

See paragraph 1.5 of Opinion CON/2019/41 and paragraph 2.1 of Opinion CON/2023/39. 

4 

 
ECB-PUBLIC 

to consumers, will continue to safeguard the legal tender of euro cash and the availability of central 

bank money31.  

2.6  Against this backdrop, the ECB closely monitors any national law developments that aim to limit cash 

payment possibilities and thereby interfere with citizens’ right to pay in cash. 

3. 

Specific observations   

Phasing out of the 1 000 DDK banknote  

3.1  The 1 000 DKK banknote, which is currently the highest denomination banknote in Denmark, has an 

approximate value equivalent to 134 EUR32. From 1 June 2026, when the 1 000 DKK banknote has 

been  phased  out  and  withdrawn  and,  therefore,  no  longer  has  legal  tender  status,  the  highest 

denomination banknote in Denmark will be the 500 DKK banknote, which has an approximate value 

equivalent to 67 EUR.  

3.2 

In the euro area, the first series of euro banknotes was originally issued in 2002, when the euro was 

introduced. It comprises seven different denominations: €5, €10, €20, €50, €100, €200 and €500. In 

May 2016, the ECB concluded a review of the denominational structure of the second series, also 

known as the Europa series, of euro banknotes. The ECB has decided to permanently stop producing 

the €500 banknote and to exclude it from the Europa series. In view of the important circulation of 

this denomination and its store of value function, also at the international level, and to safeguard trust 

in euro banknotes, the €500 banknote will remain legal tender and can therefore continue to be used 

as a means of payment and store of value. The €500 banknote, like the other denominations of euro 

banknotes,  will  always  retain  its  value  and  can  be  exchanged  at  the  Eurosystem  NCBs  for  an 

unlimited period of time. Credit institutions, bureaux de change and other professional cash handlers 

may recirculate the €500 banknotes33.  

3.3 

In  the  euro  area,  the  three  higher  denominations  of  banknotes  remain  available  as  a  means  of 

payment.  The  ECB  highlights  the  risk  for  the  cash  infrastructure  and  the  smooth  supply  of  cash 

should Member States’ policies be tailored in such a way that they disincentivise or prohibit citizens 

from using legal tender money for payments or as a store of value. Rather, the ECB considers that 

policy measures should be designed to guarantee the freedom of choice on how to pay. 

3.4  As  noted  above,  Danmarks  Nationalbank  can  continue  to  redeem  1  000  DKK  banknotes  for  12 

months after they have been withdrawn, until and including 31 May 2026, and may subsequently still 

redeem such banknotes ‘if circumstances justify it’. The ECB notes that a sufficiently long redemption 

period of the 1 000 DKK and the old series DKK banknotes would serve to uphold trust in cash, and 

refers to the Eurosystem policy of exchanging €500 banknotes for an unlimited period. In this context, 

the  ECB  understands  that  Danmarks  Nationalbank  will  assume  ´justifiable  circumstances´  and 

redeem  any    DKK  banknotes  held  legitimately  by  any  persons  in  the  Union  and  the  European 

Economic Area, who have come to possess such banknotes as a result of the free movement of 

31  
32  

33  

See COM (2020) 592 final.  
The euro value in this opinion is based on the DKK/EUR exchange rate (7,45 DKK per EUR) on the date of receipt of the 
consultation request by the ECB, 1 December 2023, as published by the ECB, available at: www.ecb.europa.eu. 
See paragraph 3.1 of Opinion CON/2019/5.  

5 

 
 
ECB-PUBLIC 

capital under Article 63 TFEU, if the person holding such banknotes is for good reason unable to 

present them for redemption before 31 May 2026,  for instance due to greater obstacles by non-

residents compared to Danish residents.  

Lowering of cash prohibition limit 

3.5  The  purpose  of  the  draft  law  is  to  lower  the  existing  threshold  for  certain  cash  payments  to 

professionals from a maximum equivalent of approximately 2684 EUR to 2013 EUR. 

3.6  Under the Treaty, the European System of Central Banks (ESCB) has the basic task of promoting 

the smooth operation of payment systems34, and the ECB has the exclusive right to authorise the 

issue of euro banknotes within the Union35. The euro banknotes issued by the ECB and the NCBs of 

the euro area are the only banknotes with legal tender status within the euro area36.  

3.7  Were Denmark to initiate an abrogation of its exemption status in accordance with Protocol (No 16) 

TFEU on certain provisions relating to Denmark, the draft law would represent a restriction of the 

legal tender status of euro banknotes, which would be assessed against the relevant Union law, as 

set out in paragraphs 3.8 to 3.1337. 

3.8  The  concept  of  ‘legal  tender’  of  a  means  of  payment  denominated  in  a  currency  unit  has  been 

considered by the Court of Justice of the European Union. In particular, the Court has clarified that 

the concept of ´legal tender´ signifies that this specific means of payment cannot generally be refused 

in settlement of a debt, denominated in the same currency unit, at its full face value, with the effect 

of discharging the debt. In clarifying the concept of  ‘legal  tender’ under Union law, the  Court has 

taken into consideration Commission Recommendation 2010/19138, which provides useful guidance 

for the interpretation of the relevant provisions of Union law. Point 1 of Recommendation 2010/191 

states that, where a payment obligation exists, the legal tender of euro banknotes and coins should 

imply (a) mandatory acceptance of those banknotes and coins; (b) their acceptance at full face value; 

and (c) their power to discharge from payment obligations. According to the Court, this shows that 

the concept of ‘legal tender’ encompasses, inter alia, an obligation in principle to accept banknotes 

and coins denominated in euro for payment purposes39.  

3.9  The Court has clarified that the concept of ‘legal tender’ is a concept of Union law that must be given 

an autonomous and uniform interpretation throughout the European Union40. Insofar as it allows the 

Union legislature to lay down the measures necessary for the use of the euro as the single currency, 

the Court clarified that Article 133 of the Treaty empowers the Union legislature alone to specify the 

legal rules governing the status of legal tender  accorded to banknotes and coins denominated  in 

euro, insofar as that is necessary for the use of the euro as the single currency. In this respect, the 

ECB notes that, on 28 June 2023, the Commission published a proposal for a regulation on the legal 

tender  of  euro  banknotes  and  coins,  which  would  establish  rules  on  the  legal  tender  of  euro 

34   
35   
36  
37  
38   

39   

40  

Article 127(2) of the Treaty and Article 3.1 of the Statute of the ESCB and the ECB.  
First sentence of Article 128(1) of the Treaty and first sentence of Article 16 of the Statute of the ESCB and the ECB.  
Third sentence of Article 128(1) of the Treaty and thirds sentence of Article 16 of the statute of ESCB Statute and the ECB. 
See paragraph 3.1 of Opinion CON/2023/39. 
Commission Recommendation 2010/191 of 22 March 2010 on the scope and effects of legal tender of euro banknotes and 
coins (OJ L 83, 30.3.2010, p. 70).  
See judgment of 26 January 2021, Hessischer Rundfunk, joined cases C-422/19 and C-423/19, EU:C:2021:63, paragraphs 
46 to 49.  
See judgment of 26 January 2021, Hessischer Rundfunk, joined cases C-422/19 and C-423/19, EU:C:2021:63, paragraph 
45. 

6 

 
ECB-PUBLIC 

banknotes  and  coins  in  binding  Union  secondary  law41.  The  explanatory  memorandum  of  the 

proposed regulation states that discussions within the Euro Tender Expert Group (ELTEG) confirmed 

the  existence  of  uncertainty  and  important  differences  regarding  the  practical  application  of  the 

concept of legal tender across the euro area42. These differences would justify establishing rules on 

the legal tender of euro cash in a regulation adopted under Article 133 of the Treaty. The ECB has 

welcomed the proposed regulation and strongly supported the establishment of rules on the legal 

tender status of euro banknotes and coins in secondary Union law, as well as the measures laid 

down in the proposed regulation regarding access to cash43.  

3.10  The Union legislature’s exclusive competence precludes any competence on the part of the Member 

States in this matter, unless they are acting on the basis that they have been empowered by the 

Union to do so or for the implementation of Union acts44.  

3.11  However, the Court further clarified that the status of legal tender calls for acceptance in principle of 

banknotes and coins denominated in euro as a means of payment, not for absolute acceptance. The 

Union´s exclusive competence in matters of monetary policy is without prejudice to the competence 

of  Member  States  whose  currency  is  the  euro  to  regulate  the  procedures  for  settling  pecuniary 

obligations, which do not affect the principle that, as a general rule, it must be possible to discharge 

a payment obligation in cash. Thus, that exclusive competence does not prevent a Member State 

from  adopting  measures  falling  within  one  of  the  Member  State´s  competences;  for  instance,  a 

Member State may, based on its competence to organise its public administration, oblige the public 

administration to accept cash payments from citizens. Neither does it prevent a Member State, in the 

exercise of its own powers, from introducing, on legitimate public interest grounds, a derogation from 

that  obligation  for  statutorily  imposed  payments,  subject  to  compliance  with  certain  conditions.  In 

particular, the obligation to accept euro banknotes and coins may, in principle, be restricted by the 

Member  States  for  reasons  of  public  interest  and  subject  to  the  principle  of  proportionality.  This 

means that any such restrictions must be proportionate to the public interest objective pursued. When 

limiting  the  possibility,  recognised  by  Union  law,  of  generally  discharging  a  payment  obligation  in 

banknotes and coins denominated in euro, Member States must ensure that any measures comply 

with the principle of proportionality, which requires in particular that they are appropriate for achieving 

the legitimate objectives pursued by the legislation at issue and do not go beyond what is necessary 

in order to achieve those objectives45.  

3.12  The Court has established that restrictions of the legal tender status of euro banknotes in particular 

require that the legislation (i) does not have the object or effect of establishing legal rules governing 

the status of legal tender of euro banknotes; (ii) does not lead, in law or in fact, to abolition of those 

banknotes, in particular by calling into question the possibility, as a general rule, of discharging a 

payment obligation in cash; (iii) has been adopted for reasons of public interest; (iv) only entails a 

41  

42  

43  
44  

45  

Proposal of the European Commission of 28 June 2023 for a regulation of the European Parliament and of the Council on the 
legal tender of euro banknotes and coins (COM(2023) 364 final).  
See the explanatory memorandum of the proposed regulation on the legal tender of euro banknotes and coins section 3, page 
4, and the Final report of the Euro Legal Tender Expert Group (ELTEG) of 6 July 2022.  
See paragraphs 1.1 and 1.2 of Opinion CON/2023/31.  
See judgment of 26 January 2021, Hessischer Rundfunk, joined cases C-422/19 and C-423/19, EU:C:2021:63, paragraphs 
50 to 52. 
See judgment of 26 January 2021, Hessischer Rundfunk, joined cases C-422/19 and C-423/19, EU:C:2021:63, paragraphs 
55 to 56 and 67 to 70. 

7 

 
ECB-PUBLIC 

limitation in on payments in cash that does not go beyond what is necessary in order to achieve the 

public interest objective46.  

3.13  Regarding the proportionality of a restriction of the legal tender status of euro banknotes, the Court 

requires not only that the measure is appropriate for attaining the public interest objective pursued, 

but also that it must not go beyond what is necessary in order to achieve that objective. The ECB 

has opined on whether limitations may be considered appropriate47. In particular, the ECB has noted 

that  the  broader  and  more  general  a  limitation  is,  the  stricter  should  be  the  interpretation  of  the 

requirement  for  the  limitation  to  be  proportionate  to  the  objective  pursued48.  When  considering 

whether a limitation is proportionate, the adverse impact of the limitation in question and whether 

alternative  measures  could  be  adopted  that  would  fulfil  the  relevant  objective  with  less  adverse 

impact should always be considered49.  

3.14  The draft law does not have the objective or the effect of amending the legal rules governing the 

status of legal tender of euro banknotes or coins. The draft law does not lead, in law or in fact, to the 

abolition of banknotes in Denmark, in particular by calling into question the possibility, as a general 

rule, of discharging a payment obligation in cash50. 

3.15  According to the explanatory notes51, the draft law is, as mentioned above, proposed to be adopted 

for  reasons  of  public  interest.  More  specifically,  all  businesses  receiving  cash  are  seen,  until  the 

phasing out of the 1 000 DKK banknote, to be extraordinarily exposed to an increased risk of being 

misused  for  money  laundering  purposes,  whilst  the  risk  is  thought  to  be  particularly  high  for 

professionals not subject to the procedures for fighting money laundering under the Law on money 

laundering.  Therefore,  it  is  considered  necessary  to  enhance  the  protection  against  money 

laundering in retail and other trades where cash is accepted by lowering the threshold for certain 

cash payments, as a consequence of the phasing out of the 1 000 DKK banknote.  

3.16  The draft law´s objective of combating money laundering may, in general, constitute a ´public interest 

reason´  justifying  the  dis-incentivisation  of,  and  the  resulting  limitation  on,  the  use  of  cash 

payments52. It is, however, difficult for the ECB to assess whether the measure contained in the draft 

law  is  appropriate  for  attaining  the  public  interest  objective  pursued,  and  whether  it  goes  beyond 

what is necessary in order to achieve that objective, especially in view of the absence of a concrete 

impact assessment of the expected effect of the draft law53.  

3.17  The proposal for lowering the threshold for certain cash payments follows two previous reductions of 

the same threshold in 2013 and 2020 respectively, on which the ECB was consulted and adopted 

opinions54.  In  2013,  the  cash  prohibition  limit  was  reduced  from  100  000  DKK  (approximately 

46  

47  
48  

49  

50  
51  
52   

53  
54  

See judgment of 26 January 2021, Hessischer Rundfunk, joined cases C-422/19 and C-423/19, EU:C:2021:63, paragraph 
78. 
See paragraph 4 of Opinion CON/2022/5.  
See  paragraph  2.7  of  Opinion  CON/2017/8,  paragraph  2.11  of  Opinion  CON/2021/18  and  paragraph  2.8  of  Opinion 
CON/2023/39.  
See  paragraph  2.7  of  Opinion  CON/2017/8  and  paragraph  2.7  of  Opinion  CON/2019/39,  and  paragraph  2.8  of  Opinion 
CON/2023/39.  
See paragraph 4.6 of Opinion CON/2022/5 and paragraph 3.2 of Opinion CON/2023/39. 
See points 1 and 1.1.2 of the general comments to the draft law. 
See,  amongst  others,  paragraph  2.2  of  Opinion  CON/2014/37,  paragraph  2.4  of  Opinion  CON/2017/18,  paragraph  2.5  of 
Opinion  CON/2017/40,  paragraph  2.3  of  Opinion  CON/2019/46,  paragraph  4  of  Opinion  CON/2022/5,  paragraph  2.10  of 
Opinion CON/2022/43 and paragraph 3.6 of Opinion CON/2023/39.  
See paragraph 3.7 of Opinion CON/2023/39.  
See Opinion CON/2013/9 and Opinion CON/2020/33.  

8 

 
ECB-PUBLIC 

equivalent to 13 422 EUR) to 50 000 DKK (approximately equivalent to 6 711 EUR). At the time, the 

ECB  noted55  that  any  impact  of  the  proposed  provisions should  be  carefully weighed  against  the 

public benefits expected to be derived from them. Also, in view of the fact that the measures affected 

relatively  low  value  payments,  competent  authorities  should  ensure  that  the  effects  of  these 

measures  do  not  go  beyond  what  is  necessary  for  achieving  the  objective  of  combating  money 

laundering and financing of terrorism. In 2020, the explanatory notes of that draft law did not clarify 

what the impact had been of the lowering of the threshold since its introduction and adoption in 2013. 

Moreover, in 2020 the explanatory notes did not clarify why, seven years after the lowering of the 

threshold for certain cash payments, the threshold needed to be further reduced to just around one 

fifth of the pre-2013 threshold56. Likewise, the explanatory notes of the current draft law do not in any 

manner address the effect of the two previous reductions of the threshold. Neither do they contain 

any  discussion  as  to  possible  alternatives  to  the  proposed  reduction.  For  instance,  one  possible 

alternative could have been to restrict the reduction of the threshold to only apply to cash payments 

made in 1 000 DKK banknotes instead of making it applicable to all cash payments irrespective of 

the banknote denominations used. For these reasons, it is difficult for the ECB to assess whether 

the objective of the current draft law will be effective.  

3.18  The ECB also notes that the effect of the current inflation rates throughout Europe on the purchasing 

power of money is something which should also be taken into account when assessing whether the 

cash  prohibition  limit  proposed  in  the  draft  law  is  proportionate  to  the  public  interest  objective 

pursued.  

3.19  The ECB acknowledges that other lawful means for the settlement of monetary debts with similar 

benefits to those of cash are generally available in Denmark above the proposed threshold equivalent 

to approximately 2013 EUR. Moreover, as noted above, the proposal to further lower the threshold 

for  certain  cash  payments  applies  only  to  professionals  who  are  not  covered  by  the  scope  of 

application of the Law on measures to prevent money laundering and financing of terrorism, when 

receiving cash. Thus, the lowering of the threshold applies only to this specific group of business-to-

business and customer-to-business payments. In this respect, the ECB welcomes the fact that this 

restriction is not intended to apply to payments between consumers, in the same way as is the case 

for  the  existing  restriction  of  20  000  DKK.  However,  as  noted  above,  no  substantiation  has  been 

provided in the explanatory notes on the effect of the previous 2013 and 2020 reductions of the cash 

limitations.57. If such measures have not produced the desired effects, it is hard to understand why 

lowering that threshold to 15 000 DKK would be considered more appropriate and more effective58. 

Moreover,  in  respect  of  contingencies  where  alternative  means  of  payment  are  temporarily  not 

functioning, flexibility should be ensured for the settlement of payment obligations in cash.  

55  
56  
57  

58  

See paragraph 2.3 of Opinion CON/2013/9. 
See paragraph 2.9 of Opinion CON/2020/33. 
See also paragraph 3.5 of Opinion CON/2022/9, with a view to fighting fiscal fraud, the limitation of cash payments from 2 500 
EUR  to  1  000  EUR  was  considered  to  be  disproportionate,  where  at  least  one  of  the  parties  to  the  transaction  acts  in  a 
professional or business capacity. 
See paragraph 3.10 of Opinion CON/2023/39. 

9 

 
3.20  Against this background, it is therefore questionable whether or not the draft law could be considered 

proportionate to the objective pursued.  

ECB-PUBLIC 

This opinion will be published on EUR-Lex.  

Done at Frankfurt am Main, 12 January 2024. 

[signed] 

The President of the ECB 

Christine LAGARDE 

10