Digital Euro and ECB Powers

Common Market Law Review, Vol. 58(4), August 2021, 1029-1056

26 Pages Posted: 22 Mar 2021 Last revised: 31 Aug 2021

See all articles by Seraina N. Grunewald

Seraina N. Grunewald

University of St. Gallen (HSG); Radboud University Nijmegen; EUSFIL Jean Monnet Centre of Excellence

Corinne Zellweger-Gutknecht

University of Zurich; University of Basel

Benjamin Geva

York University - Osgoode Hall Law School

Date Written: March 19, 2021

Abstract

The use of cash in the euro area is declining. Accordingly, the European Central Bank is exploring options for the design of a digital euro as a form of central bank money available to the public. This article addresses the key question of whether the Eurosystem is empowered to issue a digital euro and, if so, in what form. Based on a historical, teleological, and systematic interpretation, it argues that Article 128(1) TFEU serves as both a source of competence for the Eurosystem to issue a digital euro and a limitation to that competence. The Eurosystem’s powers are necessarily exclusive and must prevail over the remaining competence of Member States to issue tangible coins on the basis of Article 128(2) TFEU. The article also addresses whether a digital euro would and should possess legal tender status, referring to recent case law in the field.

Keywords: digital euro, retail central bank digital currency, rCBDC, European Central Bank, ECB, Eurosystem, banknotes, legal tender

JEL Classification: E42, E58, K23

Suggested Citation

Grunewald, Seraina and Zellweger-Gutknecht, Corinne and Geva, Benjamin, Digital Euro and ECB Powers (March 19, 2021). Common Market Law Review, Vol. 58(4), August 2021, 1029-1056, Available at SSRN: https://ssrn.com/abstract=3807855 or http://dx.doi.org/10.2139/ssrn.3807855

Seraina Grunewald (Contact Author)

University of St. Gallen (HSG) ( email )

St.Gallen, 9000
Switzerland

Radboud University Nijmegen ( email )

Postbus 9108
Nijmegen, 6500 HK
Netherlands

HOME PAGE: http://https://www.ru.nl/english/people/grunewald-s/

EUSFIL Jean Monnet Centre of Excellence ( email )

Italy

Corinne Zellweger-Gutknecht

University of Zurich

Rämistrasse 71
Zürich, CH-8006
Switzerland

University of Basel ( email )

Peter-Merian-Weg 8
Basel, CH-4003
Switzerland

Benjamin Geva

York University - Osgoode Hall Law School ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
416 736 5045 (Phone)
416 736 5736 (Fax)

HOME PAGE: https://www.osgoode.yorku.ca/faculty-and-staff/geva-benjamin/

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