European Commission to review euro coins series

Started by eurocoin, July 22, 2017, 05:25:38 PM

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eurocoin

The 2 scenarios they think best for the 1 and 2 euro cent coins:

Pros and cons of the withdrawal of coins and the swift loss of legal tender status

Should the Member States decide to withdraw these coins, their issuance would stop and they would lose their status as legal tender for payments fairly quickly, possibly with the right to redeem them at central banks even after loss of such status. Mandatory rounding of the final sum of purchase to the nearest five euro cents at cash payment would be needed throughout the euro area, to make sure that the same rule applies in the same way to the entire area. The coins would have to be actively withdrawn from circulation.

This would imply:

• immediate cost-savings: no more production or issuance costs, and no negative seigniorage;
• no more handling costs for one- and two-euro cent coins;
• rapid response to the citizens' preferences.

The downside would be the one-off costs of withdrawal. Further analysis would be necessary to obtain an estimation. These costs are difficult to estimate because they will depend on the attitude of citizens in each Member State and their eagerness to effectively return the denominations withdrawn. Previous experiences from changeovers to the euro indicate that such costs would be limited, in particular concerning very low denominations, where existing high rates of loss already point towards a lack of discipline in caring about the value represented by these coins.




Pros and cons of the phasing out of coins and the non immediate loss of legal tender status

Should the Member States decide to phase out these coins, their issuance would also stop, while the legal tender status would be withdrawn only later. Stopping the production and issuance of these coins would have a similar effect to the first scenario. However, they would remain in circulation but disappearing little by little, as large numbers of coins continue to be lost and no new ones are issued. The legal tender of the coins for payment could be withdrawn at the earliest when the circulation of the coins becomes purely residual, possibly with the right for redeem at Central Banks even after the legal tender ended. This measure would have to be accompanied by mandatory rounding as soon as the coins cease to be issued, as in the first scenario.

This would imply:

• no withdrawal costs;
• one- and two-euro cent coins would continue to be used to make payments for longer.

Compared to their withdrawal, this would imply:

• fewer economic benefits, given continued handling costs for the one- and two-euro cent coins in circulation until their numbers dwindle;
• retailers would have to continue to cater for processing one- and two-euro cent coins, albeit much less so, due to the rounding up;
• less immediate response to the wishes of most people in the Member States concerned.

eurocoin

According to the Süddeutsche Zeitung which had access to a leaked document, the Head of the European Commission, Ursula von der Leyen, this year wants to introduce uniform rounding rules with the goal of abolishing the 1 and 2 euro cent coins.

eurocoin

The Work Programme of the European Commission for 2020 that has now been released mentions:

Quote from: European Commission34. Uniform rounding rules (Follow up of Report on recent developments as regards euro coins COM(2018) 787 final/2 )

Evaluation of the use of one- and two-euro cent coins and of the possibility to introduce common rounding rules. A possible proposal would introduce common rounding rules to address the challenges related to the use of one- and two- euro cent coins (legislative, incl. impact assessment, Article 133 TFEU, Q4 2020)

eurocoin

The European Commission has today launched an evaluation and impact assessment on the use of 1 and 2 euro cent coins. A public consultation that will run for 15 weeks is part of this procedure. It is also possible to give feedback here for a period of 4 weeks on the roadmap they have made. In the consultation amongst others the relevant institutions and consumers can share their opinion on the 1 and 2 euro cent coins.

At the end of 2021, the European Commission will decide whether a legislative proposal on the introduction of uniform rounding rules for cash payments in the euro area, and possibly on the discontinuation of 1- and 2-cent coins is warranted. As part of this assessment, the Commission will carefully study the economic, environmental and social impacts of introducing uniform rounding rules.

eurocoin

Despite of the European Commission's decision about the future of the 1 and 2 euro cent coins, that is expected in the fourth quarter of this year, the Central Bank of Estonia has recently ordered 10 million 2022-dated 1 euro cent coins. That is also remarkable as the Estonian central bank for years has had plans to gradually stop the circulation of the 1 and 2 euro cent coins.

eurocoin

The results of the consulation of the public for feedback on what should happen with the 1 and 2 euro cent coins, have in the meantime been published. More than 17.000 people replied, 97% of which were from Germany, Austria, France, Italy and Spain. 70% of the respondents replied that in their opinion rounding rules should be introduced and that the 1 and 2 euro cent coins should be discontinued. 75% of the people answered that rounding should be mandatory and rules should be uniform in the euro area. Of the respondents who live in countries where rounding is not yet common, 40% expects that prices will increase if rounding would be introduced. The 1 and 2 euro cent coins were still the most popular in France, where 25% of the people were of the opinion that the coins are useful.

In a recent interview, Royal Dutch Mint CFO Bert van Ravenswaaij mentioned that the European Commission is also considering the introduction of a standard circulating 5 euro coin. The Coin Group of the European Vending Association had in the past asked for the inclusion of the possible introduction of such a coin, into the current review of the euro coin series.

Before the end of this year, the European Commission is expected to release further information about possible future changes to the euro coin series.

redlock

Quote from: eurocoin on November 28, 2021, 09:53:59 PM
More than 17.000 people replied, 97% of which were from Germany, Austria, France, Italy and Spain. 70% of the respondents replied that in their opinion rounding rules should be introduced and that the 1 and 2 euro cent coins should be discontinued.

In my opionion, not very representative for the entire EU. But the parties that want to get rid of the 1c and 2c will claim ''it's the will of the people.''
So, I think the 1c and 2c will now be gone sooner rather than later.

Quote from: eurocoin on November 28, 2021, 09:53:59 PM
In a recent interview, Royal Dutch Mint CFO Bert van Ravenswaaij mentioned that the European Commission is also considering the introduction of a standard circulating 5 euro coin. The Coin Group of the European Vending Association had in the past asked for the inclusion of the possible introduction of such a coin, into the current review of the euro coin series.

Please, don't do it.
But I guess, it will happen because the Mints in the EU are already drooling when thinking about the ''circulation commemoratives'' they will be able to mint.  >:(

chrisild

Quote from: redlock on November 29, 2021, 08:29:27 PM
So, I think the 1c and 2c will now be gone sooner rather than later.
Great, I fully support that. Besides, such "polls" are not referendums but rather consultations. People are invited to vote, and those who do not really care will not participate. (Was similar with the summer/winter time issue.) Does it matter whether the entire EU is involved? Nah, this would be about euro countries only - and also, we have several member states where rounding rules have been part of everyday life for quite a while. People from there may say, phh, we do not really use such pieces anyway, why vote at all? ;)

Introducing coins (that are legal tender in all euro countries) for the €5 denomination is not a good idea in my opinion. Initially I may have supported it, but the currency union ultimately decided that any denomination not "occupied" by the regular pieces can be used for country-specific collector coins. That includes fivers ...

Pabitra

Quote from: eurocoin on November 28, 2021, 09:53:59 PM
In a recent interview, Royal Dutch Mint CFO Bert van Ravenswaaij mentioned that the European Commission is also considering the introduction of a standard circulating 5 euro coin. The Coin Group of the European Vending Association had in the past asked for the inclusion of the possible introduction of such a coin, into the current review of the euro coin series.

Currently, the circulation coin with highest face value is 5 Swiss Franc ( roughly €4,79), followed by 500 Japanese a Yen ( roughly €3,91). While the former is now restricted to the coin sets since 1995, the later has been redesigned and a new one issued since November 2021.

eurocoin

You forget the Isle of Man 5 pound coin (€5.88). But yes, a standard circulation coin with a face value of 5 euros would certainly be very high.

andyg

Quote from: eurocoin on November 30, 2021, 09:50:40 AM
You forget the Isle of Man 5 pound coin (€5.88).

The circulation bit of the IoM £5 seems to be mostly a marketing ploy,  the coins are not used in everyday transactions any more than Royal Mint £100 pound coins are used.
always willing to trade modern UK coins for modern coins from elsewhere....

eurocoin

#26
I have several acquiantances who live on the Isle of Man, who have had 5 pound coins in their change. No new ones have been issued for circulation for a few years though.

As for that article, I know many, many, British collectors and that includes the notorious Mr Chamberlain, who has a very bad reputation in the coin collecting world. He is just after attention and knows very well that Tesco was under no obligation to accept his coin. It is a pity that he has managed to get damages from the police.

Pabitra

Quote from: eurocoin on November 30, 2021, 09:50:40 AM
You forget the Isle of Man 5 pound coin (€5.88).

Yes, you are technically right. The circulation coins in Crown dependencies are "misnomer" at best. Even Gibraltar had 5 Pound "circulation" coin till recent past.
Thanks to the Royal mint, at least 1 Pound coin has been eliminated from the list.
The Crown Territories were "expected" to scrupulously follow the UK coins for their physical specifications. I am still to locate where did they get the specifications for 5 Pounds coins.
The Pobjoy and other mints have their own method of "minting money".

africancoins

Regarding...

QuoteThe Crown Territories were "expected" to scrupulously follow the UK coins for their physical specifications. I am still to locate where did they get the specifications for 5 Pounds coins.
The Pobjoy and other mints have their own method of "minting money".

The diameters for the Virenium coins seem to come from the "Gold sovereign" series.

The pack that you can get an Isle of Man 5 Pounds 1981 Virenium coin in says... "The traditional Gold Sovereign size was the eventual choice for the "Round Pound", and this carried forward logically by adopting the traditional Gold Five Pound Piece diameter of 36.1mm for the new circulating £5 coin."

Pobjoy will then have decided on a suitable mass/thickness for each of the 3 coin sizes. If masses of the gold coins had been used then they would have been on the heavy side.

Thanks Mr Paul Baker

andyg

Yes, I forgot it has been a "circulating coin" since 1981.   I've been to the Isle of Man several times since but never have seen a five pound coin.  One pound notes are more in use than one pound coins too, although there is no shortage of mainland pound coins.


Quote from: eurocoin on November 30, 2021, 06:55:15 PM
As for that article, I know many, many, British collectors and that includes the notorious Mr Chamberlain, who has a very bad reputation in the coin collecting world. He is just after attention and knows very well that Tesco was under no obligation to accept his coin. It is a pity that he has managed to get damages from the police.

Hopefully Tesco will appeal, not because he doesn't deserve any compensation for being arrested - but because the term "legal tender" used by the mint is quite frankly in this case a silly gimmick.

He was awarded compensation because he was arrested for failing to fill in a "no payment form", usually used at times you forget your wallet with your bank card and have no method of paying - but in this case he did, but Tesco are not obliged to accept it.
always willing to trade modern UK coins for modern coins from elsewhere....