Press release, 23 January 2014
The Seimas has started to consider the draft Law on the Euro Adoption in the Republic of Lithuania (No XIIP-1450) that establishes the procedure for the preparation for the euro adoption, changeover from the litas to the euro, conversion of values in litas to values in euro after the euro adoption in the Republic of Lithuania, and withdrawal of the litas from circulation. Rimantas Šadžius, Minister of Finance, presented the draft Law and amendments to accompanying legislation at the Seimas sitting.
The submitted document sets out that the Bank of Lithuania would exchange the litas banknotes as well as the litas and cent coins to the euro free of charge for an unlimited period and without any limitation on the amount. The Minister of Finance stated that on 1 January 2015, i.e. on the euro adoption date, the money held in all client accounts would be converted to the euro free of charge. Commercial banks would exchange the litas to the euro for six months following the euro adoption date in the Republic of Lithuania free of charge in all bank units. After the expiry of this term, commercial banks would exchange the litas to the euro free of charge for another six months in bank units, the list of which would be drawn up in advance by the Bank of Lithuania.
Since the services provided by the public company Lithuanian Post Office are widely used by residents of Lithuania, particularly those living outside major cities, the draft Law imposes an obligation on the Lithuanian Post Office to exchange the litas to the euro for 60 calendar days following the euro adoption date free of charge. The Lithuanian Post Office may, however, set a maximum amount of the litas to be changed to the euro. The draft Law intends to give banks the right to set a requirement that a client willing to exchange an amount of LTL 15,000 (the Lithuanian Post Office may set another, e.g. smaller, amount) to EUR must inform a bank in advance.
The draft Law sets out a general mathematical rule for rounding: if the decimal is under 5 it is rounded down, and if the decimal is 5 or above it is rounded up.
Chapter Five of the draft Law regulates the display of prices and other amounts in euro and in litas. The display of prices in litas and euro would start after 30 days following the date when the Council of the European Union sets the irrevocably fixed conversion rate and one year following the euro adoption date. Mr Šadžius stated that this would presumably start in mid-August.
A total of 103 members of the Seimas voted in favour of the draft Law on the Euro Adoption in the Republic of Lithuania, with 3 votes against and 2 abstentions. After its approval, the draft Law will be further considered by the Committee on Budget and Finance (lead committee) and the Committee on Audit (additional committee). The Seimas also decided to accept the Government's proposal to hold a debate on the draft Law subject to urgency procedure. The draft Law is to be considered in the 4th (spring) session of the Seimas.
Rimas Rudaitis, Public Relations Unit, tel. +370 5 239 6132, e-mail: [email protected]
