What legislation is likely to be passed to facilitate the exit of a member state from the Eurozone?
The exact nature of the legislation passed will of course depend on how a member state exits the Eurozone. Where there is a consensual exit, it is likely there will be legislation at both an EU level as well as the national level of the departing member state to manage any exit of that departing member state. Even if there is a unilateral exit, there will at least need to be domestic legislation in the departing member state.
The areas such legislation may cover include:
- the creation of a new currency in place of the euro for the exiting member state;
- foreign exchange controls such as:
- how the euro may continue to be used (or not) within the exiting member state;
- restricting the amount of currency that may be imported or exported from the exiting member state;
- defining the circumstances in which persons based in the exiting member state can own and pay or be paid in euro;
- restricting currency exchange between the euro (and other currencies) and the new currency of the exiting member state to government-approved exchangers; and
- fixing the exchange rates between the euro and the new currency of the exiting member state;
- whether the exit from the euro of the exiting member state shall be grounds to alter, discharge or excuse performance of affected contacts and, if so, how.
View Eurozone risk matrix
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