How do we prepare for the arrival of the euro?

The Government of the Republic of Estonia has set a goal to start using euro at the first opportunity when Estonia is able to meet all the necessary conditions. The coal for changeover date has according to the curent economic estimatesset to 01 January 2011. The target exchange rate is 1 EUR = 15,6466 EEK (current exchange rate).

In order to ensure the smooth transition to the euro, there will be a period of two weeks starting from the €-day when the kroon and the euro are equal legal tenders. It is possible to pay with kroons as well with euros in the stores, the change shall be generally returned in euros. After the parallel operating period the euro will be the only legal tender in Estonia.

In order to make it easier to use the euro cash, the credit institutions will exchange one month prior and 6 months after the €-day kroons into euros with central exchange rate and without a commission and thereafter continue to provide this service at least for 6 months with a limited office net. After the end of exchanging kroons into euros in the credit institutions, Eesti Pank will exchange kroons into euros for an unspecified term with the central rate and without a commission.

In order to lessen the pressure on the price increase, the government will be the role model for the private sector rounding down the kroon-amounts of the taxes and state fees into euros, which is to the more advantageous direction for the tax payer.

The bank customers will have no special obligations upon the euro changeover. Your bank will solve the arising formalities for you.

The transition of the account money to euros will be on the €-day immediately without a transition period. The account money will be converted simultaneously into euros in the full amount. All transactions made as from 01 January 2011 will be also shown in euros. Prepayments and contractual payments shall be converted into euros before the operation by each bank on the basis of the exchange rate fixed by the Council of the EU.

The contract consistency principle shall apply to the bank contracts. I.e. the consistency of the contracts and other legal remedies shall not be affected by the euro changeover.

Therefore, the existing contracts do not need to be changed. The kroon-amounts shall be calculated into euros. At the same time the banks can prepare contracts in euros already before the €-day.

You can find the plan of the transition to the euro accomplished in the cooperation of the Ministry of Finance, Eesti Pank and other government offices here: Estonia’s National Changeover Plan

For additional information please contact Ministry of Finance of Estonia and Eesti Pank