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Where, under what conditions and how much can I pay in cash?

Genuine euro banknotes and coins are legal tender in the 19 countries of the euro area, as well as in the French overseas territories and some countries outside the euro area. This means that they cannot be refused as payment. However, their use is subject to certain rules and limits which vary from country to country.

Rules governing the use of banknotes and coins

 

The obligation to accept euro banknotes and coins as legal tender

The notion of legal tender

The legal tender status of euro banknotes and coins is laid down by the Treaty on the Functioning of the European Union. A number of basic elements on the legal tender of euro banknotes and coins are contained in  EC  Regulation  974/98  of 3 May 1998 on the introduction of the euro. Moreover, on 22 March 2010, the European Commission adopted a recommendation clarifying the scope and eff of legal tender of banknotes, which sets out the following ten guiding principles :

The 10 guiding principles
  • The legal tender of euro banknotes and coins should imply : mandatory acceptance, acceptance at full face value and power to discharge from payment obligations.
  • The acceptance of euro banknotes and coins as means of payments in retail transactions should be the rule. A refusal thereof should be possible only if grounded on reasons related to the “good faith principle” (for example if the retailer does not have enough change).
  • The acceptance of high denomination banknotes should also be the rule.
  • No surcharges should be imposed on payments with euro banknotes and coins.
  • Member States should avoid adopting new rules for rounding prices to the nearest 5 cents.
  • Member States should take all measures deemed appropriate to prevent euro collector coins from being used as means of payments.
  • Stained banknotes should be returned to national central banks as they might be the product of a theft.
  • Member States should neither prohibit nor penalise the total destruction of small quantities of euro banknotes or coins by individuals.
  • The mutilation of euro banknotes and coins for artistic purposes should be tolerated.
  • The competence to destroy fi euro coins should not belong to national authorities in isolation anymore.

In practice, however, the scope and effects of the legal tender status of euro banknotes and coins are still governed by national law.

In France, the majority of the rules relating to euros were already applicable to the old franc banknotes and coins, and are largely set out in the national Monetary and Financial Code.

The protection of legal tender is guaranteed by Article R642-3 of the French Criminal Code: “Refusing to accept banknotes and coins that have legal tender in France at the value at which they are in circulation is punishable by a fine applicable to class two offences.”

 

The legal tender status and exchange of first-series euro banknotes following the issuance of the Europa series

The Europa series banknotes issued from 2013 onwards will initially circulate in parallel with the first series as legal tender. The first series will gradually be withdrawn from circulation and the date on which it ceases to be legal tender will be announced well in advance. After this date, it will not be possible to use first banknotes as legal tender, although they will be exchangeable for an unlimited period at the Banque de France and at Euro-system NCBs.

Article 106 of the Treaty on European Union

“1° The ECB shall have the exclusive right to authorise the issue of banknotes within the Community. The ECB and the national central banks may issue such notes. The banknotes issued by the ECB and the national central banks shall be the only such notes to have the status of legal tender within the Community.”


 

The obligation to accept banknotes and coins is subject to a certain number of conditions

  • Only euro banknotes and coins have legal tender status in euro area countries, foreign banknotes and coins (dollar, yen, pound sterling, etc.) and euro collector coins issued in a country other than France are not legal tender in France. However, French retailers are entitled, exceptionally, to accept foreign banknotes off ed as payment by a non-resident at their own risk. Manual exchange activities are regulated.
  • Banknotes and coins used for payment must be in good condition, pursuant to the principle of “the right incorporated in the means of payment”. If a banknote is mutilated or damaged, a retailer is entitled to refuse it because its value is unclear. However, in most cases, these banknotes may be exchanged free of charge and under the same conditions at all Eurosystem central banks (ECB decision 2013/10).


Thus, banknotes of which only a small part is missing can be exchanged immediately and free of charge at any Banque de France branch with cash activities (see list at www.banque-france.fr).

In the case of burned or badly damaged banknotes, an expert assessment may be required. The banknotes will only be reimbursed following this assessment.
 

  • There is no obligation to accept more than 50 coins for any single payment (Article R112-2 of the Monetary and Financial Code). This limit does not apply to cash payments made at Treasury counters; however, since 1 January, the latter may not exceed €300.
  • Cash transactions must not exceed certain limits. The legal thresholds are set out in Articles L112-6 and following, and in Article D112-3 of the Monetary and Financial Code :
  • €1,500 : maximum salary or advance in salary payable in cash (Article L112-6 of the Monetary and Financial Code and Article L3241-1 of the Labour Code, amended by Decree No. 85-1073 of 7 October 1985 and Decree No. 2001-96 of 2 February 2001).
  • €1,000 : maximum cash payments by individuals resident in France for tax purposes, or for a professional activity.
  • €15,000 : maximum cash payments by non-residents, provided the payment is not for professional purposes.

 

These limits do not apply to the following:

  • individuals who have no other means of payment or who do not have a deposit account
  • payments between individuals which are not for professional purposes.


Specific regulations apply to certain cash transactions :

  • Physical transportation of cash (Article L152-1 of the Monetary and Financial Code) : individuals transporting cash to or from countries outside France (including European Union and euro area countries) other than through a banking institution are required to clear these transactions through customs for amounts equal to or exceeding €10,000. This threshold applies in particular to cash transfers.
  • Anti-money laundering and terrorism financing regulations (Book V, Title VI of the Monetary and Financial Code) : clients of financial institutions carrying out cash transactions (manual exchange, exchange of banknotes, etc.) must provide proof of identity in accordance with the provisions of the Monetary and Financial Code on exchange transactions.


The buyer or debitor must pay the exact amount if asked by the seller or creditor (Article L112-5 of the Monetary and Finan- cial Code); the seller may therefore refuse a cash payment in euros if he/she does not have sufficient change or if the face value of the banknote tendered is disproportionate compared to the amount owed.

Banknotes and coins may not be sent by post and the transportation of large amounts of cash is regulated (a cash-in-transit company must be used for amounts over €30,000).

The seller is entitled to ask the client to give his/her identity if the banknote does not appear genuine.

Updated on: 01/10/2017 11:00