Legal issues in the EURO changeover process

1. Legal issues in the EURO changeover process Experience of Belgium : common approach in regulation Prague, January 14th en 15th, 2008 Christiaan DELAERE Director of Administration of Fiscal Affaires former Chairman of Administrative Committee of Regulation

2. Content • Admi-euro • Administrative Committee of Regulation • Timing • Uniform conversion rules • Conversion of amounts • Acceptance • Success factors

3. Admi Euro • Conversion into Euro = enormous conversion project • Who is involved? • All residents • All companies • All ministries and authorities • ... Everybody ! • For the conversion of the complete apparatus of government : co-ordinated approach necessary : Admi-Euro

4. Admi Euro 21/03/2003 • Multidisciplinary group • All administrations are represented : • Federal ministries • Semi-governmental bodies • Regional ministries • Provinces and municipalities • Also represented: • National Bank of Belgium • Council of State • Under chairmanship of Secretary-general Ministry of Finance • Co-ordinates conversion into Euro

5. Administrative Committee Regulation • What?: one of of 4 administrative committees within Admi-Euro • Chairmanship: • Initially: Ministry of Justice • Later: taken over by Ministry of Finance • Started: March 1997 • Assignment: conversion of all regulations towards euro before 01/01/2002 • All administrations are represented

6. Timing (1) • Influenced by European regulations • First meeting : march 1997 • Draw up conversion rules • Draw up Eurolaw 1 : Law of October 30, 1998 concerning the Euro • Draw up 2 special laws introducing the Euro : • Law of June 26, 2000 concerning the introduction of the Euro in legislation (Art. 78 Constitution) • Law of June 30, 2000 concerning the introduction of the Euro in legislation (Art. 77 Constitution)

7. Timing (2) • Draw up directives for future regulation (circular letter of October 20, 2000) • Draw up Eurolaw 2: Law of December 10, 2001 concerning the permanent introduction of the Euro • Period 1999-2001: Royal decrees converting legislation into Euro • End 2001: circular letters for the public servants in ministries • All legislation was published in the OJ before 1/1/2002 • Ratification laws : June 20, 2002 and June 26, 2002

8. Uniform conversion rules • Uniform rules – coherent and clear notation (rules with respect to legislation technique) • Laws and Royal decrees are built according to similar plans • Use always same type of notation • Converted amounts are presented in schedules: “in the next articles of the code of… the amounts in BEF in the 2nd column are replaced by the amounts in the 3rd column

9. Uniform conversion rules coherent and clear notation • Fixed rules with respect to notations in euro : • In texts one should always write “euro” • A part of Euro = “cent”,never “eurocent” • Fixed amount in laws: always “EUR” : 9,54 EUR • Amount is always written in Arabic numerals : 1.000 EUR and not thousand EUR • In texts of a law all amounts are written with 2 decimals : 1.000.000,00 EUR and not 1.000.000 EUR • In written texts one can use amounts without the decimals:1.000.000 EUR. Or even 1.000.000 euro.

10. Conversion of amounts • Principles: • No prohibition, no compulsion • Continuity of legal instruments • All amounts in the national currency are read as they were converted in euro • Art. 14 Council Regulation n° 974/98 of may 3, 1998 on the introduction of the euro • If nothing is mentioned : mathematical conversion • 1 EUR = 40,3399 BEF • No need to change legislation???

11. Conversion of amounts –problems • Readability: • 1 EUR = 40,3399 Belgian francs (BEF) • Result : 1.000.000 BEF = 24.789,35 EUR; • No more transparent amounts: • e.g.1: minimum capital of limited companies by share: 2.500.000 BEF = 61.973,38 EUR?? • e.g.2: exemption of tax on interest from saving deposits: 50.000 BEF = 1.239,47 EUR??

12. Conversion of amounts –problems • Uniformity : • Round up ?? Round down ?? • Ex: round off 3.000 BEF to 74 EUR ?? To 75 EUR ??? Or to 80 EUR ?? • Rule : always similarly round off same amount in same circumstance • Legal security? • Some amounts are converted and other are not? • Conversions to be expected?

13. Conversion of amounts – solutions • Decision to convert all amounts: • All amounts rounded up or down • All amouts converted mathematically • Advantages: • Clear communication • No doubt about the new amount in EUR • Legal security

14. Conversion of amounts – results • Series 1: July 20, 2000: • 12 Royal decrees/Law, ratified on 20/06/2002 (11) and 26/06/2002 (1) • 12 ordinary Royal decrees • Series 2: July 13, 2001 (1 dated June 14, 2001): • 10 Royal decrees/Law, ratified on 26/06/2002 • 10 ordinary Royal decrees • Series 3: December 4, 2001 • 25 ordinary Royal decrees with respect to provisions public servants, wages and remuneration • Series 4: December 11, 2001 • 6 Royal decrees/Law, ratified on 26/06/2002 • 8 ordinary Royal decrees

15. Conversion of amounts – results • 16 decrees only for the department of Finance • All dated December 18, 2001 • Conversion of existing ministerial decrees

16. Acceptance • Principle: to the BENEFIT of the taxpayer • Exception : fines and penalty clauses • Budgetary cost price ! 35.000.000 EUR • Conversion laws and decrees contains only changes relating to the euro conversion; no hidden changes relating to other reasons or decisions • Euro starter kits: benefits exemption of taxation

17. Success factors for the conversion • Timing: start in time • Common approach (= for all ministries) • Establish uniform conversion rules • Uniformity – coherent and clear notation • Clear communication • Acceptance by all parties concerned : conversion should be positive, also in regulation