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Euro Introduction in Belgium: Transition Plan & National Changeover

Learn about the introduction of the euro in Belgium, including transition phases, national changeover plans, monetary policies, and coordination structures. Understand how the euro replaced the Belgian franc in various sectors effectively.

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Euro Introduction in Belgium: Transition Plan & National Changeover

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  1. The introduction of the Euro Dirk OomsPhilippe Quintin National Bank of Belgium

  2. The introduction of the euro :European scenario Two deadlines 04.01.1999 : • introduction of non cash euro • start of the transition period • national currency retains legal tender status 01.01.2002 : • introduction of euro notes and coins • end of transition period • start of exhange of notes and coins

  3. Belgian scenario : maximum option Different choice abroad : ( double big bang )

  4. National Changeover Plan Translation of Madrid scenario (December 1995) into a National Changeover Plan AIMS: From January 1, 1999: - financial flows will be possible both in euro and in BEF - information concerning these flows will be exchanged in euro and in BEF - neutrality of public administration Principle of NO PROHIBITION, NO COMPULSION

  5. National Changeover Plan Concerns: - the changeover of payment systems - the issuing of public debt securities - financial markets - banking operations - public administrations - accounting - physical persons - reporting bodies and statistics  creating of a permanent coordination structure

  6. National Changeover Plan Concerns 1. The National Bank of Belgium 2. Public debt: - linear bonds and treasury certificates will be issued in euro Government notes and "Philippe" loans will progressively be issued in euro

  7. National Changeover Plan 3. Financial markets: - quotation and settlement carried out in euro among professionals, communication with third parties in BEF or euro 4.Banks: - scriptural payments in BEF or euro. Application of "no compulsion, no prohibition"

  8. National Changeover Plan 5. Public administrations: - internal functioning: changeover on January 1, 2002 - external communication: in euro or BEF from January 1, 1999 6. Accounting practices: - in BEF or euro for annual accounts closed from January 1, 1999

  9. National Changeover Plan 7. Physical persons: - accounts in euro can be opened from January 1, 1999 - same for salaries and other allowances 8. Reporting bodies and statistics: - possibility to opt for the euro from January 1, 1999  Creation of permanent coordination structure

  10. NBB Changeover Plan Objectives: • changeover of the NBB • integration of the NBB into the ESCB

  11. NBB Changeover Plan Approach: combination of • centralisation • decentralisation Excluded: • legal convergence • social aspects

  12. NBB Changeover Plan Steering Committee "NBB in stage 3" • established - spring 1996 • composition • mandate: preparing the Bank for its own changeover to the euro and for its participation as an operational entity in the Eurosystem

  13. NBB Changeover Plan Organisation of activities: identification of 8 overall sectors(cf. EMI sub-committees and working groups)

  14. NBB Changeover Plan • Monetory and exchange rate policy • Payment systems • Securities • Statistics • Banknote production and circulation • Accounting • Data exchange • IT

  15. NBB Changeover Plan • designation of responsibles per area • identification of projects • regular monitoring, meeting and reporting

  16. NBB Changeover Plan "Big Bang" option (1997): the complete changeover of the Bank, its accounts and its transactions as from the start of the third stage

  17. NBB Changeover Plan BUT: NO PROHIBITION, NO COMPULSION

  18. General Commission for the Euro • Decision taken by the Council of Ministers on November 22nd, 1996, to create a permanent structureto coordinate the preparation for the single currency • 1.AIMS • favour the exchange of ideas and information between the sectors concerned • see to the coherence of initiatives and decisions • ensure the necessary initiatives are taken •  make sure deadlines are met • make RECOMMENDATIONS

  19. General Commission for the Euro 4 central groups COM EURO COM Structure FIN EURO ADMI EURO ECO EURO Financial sector Publicsector Companies & consumers Communication

  20. General Commission for the Euro Steering Committee Euro Cel Structure General Assembly

  21. Recommendations of Fin euro In charge of the co-ordination of the changeover of the financial sector to the single currency cover : - principles banks have adopted - adaptation of non cash means of payment - changeover of financial markets (quotation and publication of stock prices) - preparation of the cash changeover - control and reporting

  22. How and when will banknotes be exchanged ?

  23. ADMI-EURO Meeting of general secretaries (top civil servants) executive committee ( Permanent unit + Coordoninators general) Sector coordinators Local authorities IT Communication Budget + Accounting Regulation

  24. Preparation of non financial enterprises and private persons for the euro

  25. The non financial economy • Numerous and diverse themes and actors • Relations between enterprises • Relations employers/employees • Relations enterprises / consumers • Prices : indication, control ... continuity of contracts • Accounting • recommendations of the concertation bodies • RECOMMENDATIONS

  26. Label and code of good conduct Label provided to professionals if certain rules are respected • twin indication of minimum prices • information to customers • indication of whether payments in euro are accepted • instruments to facilitate the conversion • respect of rules regarding conversion, rounding and the continuity of contracts ! Euro observatory

  27. Payments in euro accepted

  28. Other actors European commission: • legal framework • communication material • surveys European Central Bank: • Co-ordination changeover 1999 • Euro 2002 - communication campaign

  29. Legal framework • European law • National law • Organic law of the NBB

  30. Changeover weekend Eurosystem • critical milestones • teleconferences National economy

  31. Recommendations concerning conversion and rounding - Conversion BEF EUR and EUR BEF - Conversion of prices - Cross conversions - Specific cases : reconstitution of amounts and reconciliation of results - Conversion of statistics - Conversion of limits - Accounting problems.

  32. BELGIUM Banknotes in circulation: number : 330 million representing some ± 440 billion BEF Coins: number : 3.5 billion representing some : 23 billion BEF weight : ± 12000 tons

  33. Practical details • Pro-active scenario

  34. Pro-active scenario From July 1st, 2001 accelerate use of the euro by among others : - conversion of bank accounts into euro - invoicing in euro - sending euro transfer forms - encouraging the use of the euro in enterprises - adapting petrol pumps, metrological equipment...

  35. 1- Banks • Make customers aware of the euro by • providing information • proposing products and services in euro • On July 1st, 2001 : • Banks progressively convert bank accounts and products into euro but statements mention both currencies, (EUR and BEF) !

  36. 2- Major invoice issuing bodies • Companies that issue most invoices, such as telecom operators, electricity, gas and water providers, insurance companies... • start on July 1st,2001 with : • invoicing completely in euro • transfer forms in euro

  37. 3- Public authorities • Start as from July 1st, 2001 : to draw up and send out EUR transfer forms • For operations whose pay by date is after December 31st, 2001, EUR transfer forms will be sent out

  38. 4- Enterprises Focus points : • accounting • social administration don't wait until January 1st, 2002!

  39. 5- Metrological equipment • adaptation possible from July 1st, 2001 • taxameters • scales • petrol pumps • additional information in BEF at least until 31st of December 2001

  40. Practical details • The Belgian scenario for the changeover of euro notes and coins

  41. The Belgian changeover scenario Phase I: preparatory phase from September to end 2001: frontloading Banks, Post Office, Security carriers Distribution, Commerce Private persons from October 15th to November 15th 2001: operation piggy bank E-Day • new storage place • adapted communication in function of the target group

  42. Frontloading professionals : Euro banknotes: • bundles of 25 or 100 notes • small denominations : 5, 10 and 20 € Euro coins: • euro starterkits • rolls

  43. EUROSTARTERKIT PROFESSIONALS Frontloading via financial institutions • Transportation and storage • Start with an event width : 15,8 cm, length : 23,7 cm, height : 2,8 cm

  44. EUROSTARTERKIT PROFESSIONALS

  45. Frontloading public (from December 15th, 2001) • only coins • euro minikits 12,40 € (500 BEF) • via banks, post office, public transport companies, employers

  46. EUROMINIKIT GRAND PUBLIC

  47. "Operation piggybank" • from October 15th to November 15th 2001 • Information campaign

  48. "Operation piggybank" • in plastic clips • to be handed in completely full at the counters of commercial banks, the Post Office and the National Bank of Belgium • free of charge

  49. The Belgian changeover scenario Phase II: twin circulation Period of twin circulation Frontloading Critical mass End of legal tender from September 2001 28 February 2002 mid January 2002 E-Day

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