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THE EURO PEANCOUN CIL 15-16 DECEMBER 1995 Madrid European Council Reproduced from the Bulletin Ofthe European Communities, No. 1

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THE EURO PEANCOUN CIL 15-16 DECEMBER 1995 Madrid European Council Reproduced from the Bulletin Ofthe European Communities, No. 1 THE EURO PEANCOUN CIL MAD RID 15-16 DECEMBER 1995 Documents in the dossier include: Madrid European Council Reproduced from the Bulletin ofthe European Communities, No. 12/1995 Madrid European Council. December In this connection, having welcomed the Reflection Madrid, 15 and 16 Group s report, the European Council decided to launch the Intergovernmental Conference on 1.1. Chaired by Mr Gonzalez, President of the 29 March 1996 in order to establish the political and European Council and Prime Minister of Spain, institutional conditions for adapting the European the summit of Heads of State or Government of Union to present and future needs, particularly with a the Member States took place in Madrid in the view to the next enlargement. presence of Mr Santer, Mr Van den Broek and It is essential that the Conference achieve results suffi- Mr de Silguy, for theComrnission. It was pre- cient to enable the Union to bring added value to all ceded by an exchange of views with Mr Hfulsch, its citizens and to shoulder its responsibilities ade- President of P~liament, and followed by a quately, both internally and externally. meeting with the Heads of State or Government The European Council notes with satisfaction some associated coun~ and Foreign Ministers of the significant achievements in the area of .external rela- tries of Central and Eastern Europe, including tions which have occurred since its last meeting and in the Baltic States, and Cyprus and Malta. which the European Union has played a decisive role: 0 the signing in Paris of the Dayton Agreement, which puts an end to the terrible war in former Yugo- slavia and builds on considerable European efforts over the preceding months in military, llUmanitarian and negotiating terms; the European Council recog- Conclusions of the nizes the decisive contribution made by the United Presidency States at a crucial moment; 0 the new transatlantic agenda and the joint EU- action plan signed at the Madrid summit on 3 Decem- ber 1995, which are major joint commitments with the PART A United States to revitalize and strengthen our associ- ation; 0 the signing in Madrid of the interregional frame" Introduction work agreement between the European Union and Mercosur, the first agreement of this type to be con- 1.2. The European Council, meeting in Madrid on 15 cluded by the European Union; and 16 December 1995, took decisions on employ- com- ment, the single currency, the Intergovernmental 0 the Barcelona Declaration, launching a new, Conference and enlargement to bring in countries of prehensive Euro-Mediterranean association which will Central and Eastern Europe and the Mediterranean. promote peace, stability and prosperity throughout the Mediterranean through a permanent process of dia- The European Council considers that job creation is logue and cooperation; the principal social, economic and political objective 0 the signing in Mauritius of the revised Lome IV States, and of the European Union and its Member Convention by the European Union and the ACP declares its firm resolve to continue to make every States, which will consolidate the association between effort to reduce unemployment. the two sides; The European Council adopted the scenario for the 0 the European Parliament's assent to the customs changeover to the single currency, confirming une- union between the European Union and Turkey, quivocally that stage three of economic and monetary which opens the way for the consolidation and streng- union will commence on 1 January 1999. thening of a political, economic and security relation" The European Council decided to name the currency, ship crucial to the stability of that region. to be used from 1 January 1999, the 'Euro The European Council began its proceedings by The European Council continued its deliberation on exchanging ideas with Mr Klaus Hiinsch, President of the future of Europe, which was launched in Essen the European Parliament, on the main subjects for dis- and continued in Cannes and Formentor. cussion at this meeting. Bull. EU 12- 1995 Conclusions of the Presidency Finally, a meeting took place today between the the agreed and definitive interpretation of the relevant Heads of State or Govemment and the Ministers for Treaty provisions. Foreign Affairs of the associated countries of Central 3. As a decisive step in the clarification of the process and Eastern Europe, including the Baltic States of introduction of the single currency, the European (CCEE), as well as Cyprus and Malta. There was a Council adopts the changeover scenario attached in broad exchange of views on these conclusions, mat- Annex 1, which is based on the scenario elaborated at ters concerning the pre-accession strategy and various its request by the Council, in consultation with the issues relating to international policies. Commission and the European Monetary Instimte. It notes with satisfaction that the scenario is fully com- patible with theEMI report on the changeover. - The economic revitalization of 4. The scenario provides for transparency and accept~ Europe in a socially integrated ability, strengthens credibility and underlines the irre" framework versibility of the process. It is technically feasible and aims to provide for the necessary legal certainty, to A. Economic and monetary union minimize adjustment costs and to avoid competitive distortions. Under the scenario, the Council, in the References: Commission Green Paper on the composition of Heads of State or Government, will practical arrangements for the introduction of the confirm as early as possible in 1998 which Member single currency: COM(95) 333; Bull. 5- 1995, States fulfil the necessary conditions for the adoption point 1.3. of the single currency. The European Central Bank Conclusions of the Cannes European Council: (ECB) will have to be created early enough so as to Bull. 6- 1995, point 1. allow preparations to be completed and full operation Statement by Mr de Silguy on behalf of the to start on 1 January 1999. Commission on the European Monetary Insti- 5. Stage three will begin on 1 January 1999 with the rote s report on the scenario for the introduction irrevocable fixing of conversion rates among the cur- of the single currency: Bull. 1l~1995, point 1.3. rencies of participating countries and against the Euro. From that date, monetary policy and the foreign ex- I. The scenario for the changeover to the change rate policy will be conducted in Euro, the use single currency of the Euro will be encouraged in foreign exchange markets and new tradeable public debt will be issued 1.3. 1. The European CounCil confirms that 1 January in Euro by the participating Member States. 1999 will be the starting date for stage three of eCOno" mic and monetary union, in accordance with the con- 6. A Council Regulation, whose technical preparatory vergence criteria, timetable, protocols and procedures work shall be completed at the latest by the end of laid down in the Treaty. 1996, will enter into force on 1 January 1999 and pro- vide the legal framework for the use of the Euro, The European Council confirms that a high degree of which, from this date, will become a currency in its economic convergence is a precondition for the Treaty own right, and the official ecu basket will cease to ex- objective to create a stable single currency. ist. This Regulation will establish, as long as different 2. The name of the new currency is an important ele- monetary units still exist, a legally enforceable equiv- ment in the preparation of the transition to the single alence between the Euro and the national units. The currency, since it partly determines the public accept- substitution of the Euro for national currencies should ability of economic and monetary union. The Euro- not of itself alter the continuity of contracts, unless pean Council considers that the name of the single otherwise provided in the contract. In the case of con- currency must be the same in all the official languages tracts denominated by reference to the official ecu of the European Union, taking into account the exist- basket of the European Community, in accordance ence of different alphabets; it must be simple and with the Treaty, substitution by the Euro will be at the symbolize Europe. rate of one to one, unless otherwise provided in the contract. The European Council therefore decides that, as of the start of stage Wee, the name given to the European 7. By 1 January 2002 at the latest, Euro banknotes and currency shall be Euro. This name is meant as a full coins will start to circulate alongside national notes name, not as a prefix to be attached to the national and coins. At most six months later, the national cur- currency names. rencies will have been completely replaced by the Euro in all participating Member States and the The specific name Euro will be used instead of the changeover will be complete. Thereafter, national generic term 'ecu' used by the Treaty to refer to the banknotes and coins may still be exchanged at the European currency unit. national central banks. The Governments of the 15 Member States have 8. The European Council calls on the Ecofin Council achieved the common agreement that this decision is to speed up all the additional technical work necessary Bull. ED 12- 1995 Conclusions of the Presidency to implement the changeover scenario adopted today. States' economies on a durable basis, in order both to The labelling of Euro banknotesand coins in the dif- create stable conditions for changing over to the single ferent alphabets of the Union will also be defined. currency and to secure smooth functioning of the internal market. In that connection, it approved the Council report on the implementation of the broad II.
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