LUXEMBOURG (CN) — Businesses in the European Union should accept cash, but countries are allowed to place their own restrictions on currency usage, an adviser to the EU’s high court said Tuesday.
The nonbinding advisory opinion from Advocate General Giovanni Pitruzzella says companies in the 27-member political and economic union should accept euro notes because people who don’t use banks may struggle to pay with other methods, but he wrote countries can impose currency regulations so long as they are in the public interest and do not abolish the euro.
The case was referred to the Luxembourg-based European Court of Justice by the German Federal Administrative Court, following an appeal by two men who had been charged late payment fees after a German public broadcaster refused to accept their payments in cash.
German households are required to pay a monthly fee to their public broadcasting corporation for services. In 2015, Johannes Dietrich and Norbert Häring attempted to pay their fee to the Hessischer Rundfunk in cash. The official broadcaster for the state of Hesse refused to accept the payment, instead demanding they pay by a bank transfer.
Both men refused and were each fined 60.50 euros ($71) for late payment charges. They challenged the fine, arguing there is an “unconditional and unrestricted obligation to accept euro banknotes” on commercial entities in the EU.
Pitruzzella agreed with the two men that euros are the sole legal tender for eurozone countries.
“The concept of legal tender as regards banknotes and coins must be understood as entailing an obligation in principle for the creditor of a payment obligation to accept banknotes and coins,” he wrote.
But he found that under EU law, countries can legislate how euros are used.
“Such limitations are compatible with the concept of legal tender as regards euro banknotes provided … they are established for public reasons and that other lawful means of payment for the settlement of monetary debts are available,” the opinion states. “They must also be appropriate for attaining the public interest objective pursued and not go beyond what is necessary in order to achieve that objective.”
Despite widespread usage of electronic forms of payment in the EU, Pitruzzella wrote that “cash still plays an important role in the euro area economy and thus the advent of a cashless society does not seem as imminent as some people like to think (in Europe, at least).” (Parentheses in original.)
The advisory opinion expressed concern that people without access to a bank account would be harmed by policies requiring electronic payments.
“There is an obligation to take appropriate measures to enable vulnerable people who do not have access to basic financial services to discharge their obligations, particularly those of a public nature, without additional costs,” Pitruzzella said.
Introduced in 1999, the euro is the official currency of 19 countries in the EU as well as all EU institutions and a number of other countries with close ties to the EU, such as Vatican City.
The European Court of Justice follows the legal reasoning of its magistrate about 80% of the time. A ruling from the court is expected before the end of the year.