Part VI Monetary Unions and other Forms of Monetary Organization, 29 The Euro Regulations

Subject(s):

Eurocurrencies as money — Euro Regulations — Eurozone — European Central Bank — European Banking Authority (EBA)

This chapter examines the legal framework for the introduction of the single currency. Two separate Council Regulations were made in order to provide the initial framework for the use of the euro. The first Regulation, Council Regulation 1103/97, was made under Article 308 (formerly Article 235) of the EC Treaty and came into effect in June of 1997. In broad terms, the Regulation is directed to three main issues upon which early clarification had been sought, namely (a) the consequences of monetary union for the European Currency Unit (ECU); (b) the continuity of transitional contracts which ‘spanned’ the introduction of the euro; and (c) the calculation and rounding of applicable conversion rates. While Council Regulation (EC) 1103/97 applies to all Member States, even if they currently remain outside the eurozone, Council Regulation (EC) 974/98 applies only within the participating, eurozone Member States. A number of its provisions must be regarded as the lex monetae of the eurozone Member States. The chapter then looks at Council Regulation 2866/98 and the promotion of the single currency.