Exchange Rate Mechanism

HC Deb 25 January 1995 vol 253 cc237-8W

Sir Thomas Arnold

To ask the Chancellor of the Exchequer, pursuant to his answer of 16 January 1995,Official Report, column 289, if he will outline the common procedure mentioned in paragraph 1 of the communiqué and the steps therein.

Mr. Nelson

Article 3 of the resolution of the European Council of Brussels of 5 December 1978 provides thatadjustments of central rates will be subject to mutual agreement by a common procedure which will comprise all countries participating in the exchange rate mechanism and the Commission. There will be reciprocal consultation in the Community framework about important decisions concerning exchange rate policy between countries participating and any country not participating in the system

Any member state intending to change, establish or reestablish the parity, central rate or intervention points of its currency within the ERM is required to initiate a prior consultation procedure by informing the relevant authorities of member states.