HC Deb 19 March 1998 vol 308 cc672-4W
Mr. Mitchell

To ask the Chancellor of the Exchequer if he will make a statement about his proposals for the design of the banknotes for the proposed European single currency. [34791]

Mrs. Liddell

The EMI is responsible for supervising the technical preparations of euro banknotes, in accordance with Article 109f(3) of the Treaty. The initial designs for euro banknotes were unveiled at the European Council in Dublin in December 1996. Final decisions on the technical specifications of euro banknotes will be taken by the ECB once it is established.

Mr. Redwood

To ask the Chancellor of the Exchequer (1) what estimate he has made of the proportion of British businesses which account to six places of decimals; [35217]

(2) if British companies dealing with European companies which are using the euro will be required to change their accounting systems to use the triangulation method and six places of decimals. [35220]

Mrs. Liddell

I refer the right hon. Member to the answer that I gave on 12 March 1998,Official Report, column 309. Businesses accounting in euro do not need to follow the triangulation method, which only concerns the conversion from one national currency unit of a country participating in the single currency to the national currency unit of another such country. There is no requirement to account in euro to six significant figures.

Mr. Redwood

To ask the Chancellor of the Exchequer (1) what regulations there will be, after the exchange rates of the euro-participating currencies are locked in May, to prevent different prices, spreads or commissions in dealings in these currencies [35219]

(2) what decisions (a) have been taken and (b) remain to be taken on the permitted or recommended spread or commission once the European currency rates of euro countries are locked in May. [35218]

Mrs. Liddell

Bilateral conversion rates between currencies of countries participating in the single currency will form the basis for the conversion rates between national currencies and the euro, in accordance with Article 1091(4) of the Treaty on 1 January 1999. These bilateral rates will be announced on 3 May 1998. There will be no regulations on spreads or commissions covering the period from 3 May 1998 to the start of stage three.

Conversions from the euro unit to the national currency units of participating countries from 1 January 1999 and vice versa will be required to use the special conversion rate in accordance with council regulation (EC) No. 1103/97 of 17 June 1997.

Mr. Redwood

To ask the Chancellor of the Exchequer if the Government plan to legislate to abolish the ecu. [35216]

Mrs. Liddell

No. The ecu, as referred to in Article 109g of the EC Treaty and defined in Council Regulation (EC) No 3320/94 of 22 December 1994, will become the single currency on 1 January 1999, in accordance with Article 1091(4) of the EC Treaty, and will be called the euro. Council Regulation (EC) No 1103/97 of 17 June 1997 which will be applicable in all member states, including the United Kingdom, provides confirmation that references to the Ecu in contracts and other legal instruments, including legislation, will be presumed to refer to the euro.

Mr. Redwood

To ask the Chancellor of the Exchequer if the Government plan an Act of Parliament to legalise(a) the euro as a foreign currency and (b) the compulsory conversion of other European currency contracts into euros. [35215]

Mrs. Liddell

It is a rule of the conflict of laws, applied by courts in the various jurisdictions in the United Kingdom, that a foreign currency has the status accorded to it by the law governing that currency. Courts in the United Kingdom will therefore recognise the status that the euro will have under EC law, including Council Regulation 1103/97 of 17 June 1997 which confirms that references in contracts to national currencies replaced by the euro will be interpreted to refer to the euro. Domestic legislation will not be required in the United Kingdom.