The change from our national currency to the euro, which is planned to take place in 15 months’ time, undoubtedly requires careful preparation. A number of factors must be taken into consideration, including any necessary adjustments arising from an administrative or legal perspective.

It is interesting to note, however, that despite the many changes that will occur as a result of the change in currency, no amendments are required to make contracts or agreements “euro-compliant”. This applies to both contracts that have been agreed upon by two or more parties, where monetary amounts have already come into effect, as well as promise of sale agreements where the fully finalised agreement has yet to be drawn up.

Malta’s changeover to the euro substantially benefits from the transition period that served as the run up to the euro in the “first wave” euro zone member states back in 2002. In actual fact, this transition period lasted three full years, during which the 12 euro zone countries had the opportunity to pinpoint any legal changes that may have been necessary as a result of the imminent adoption of the new single currency. The legal framework dealing specifically with such issues was set up at European level through the implementation of the essential principle generally referred to as “contract continuity”.

The name itself is self-explanatory – it specifies that any contracts or promise of sale agreements that make a direct reference to monetary amounts in the national currency, in our case the Maltese lira, and that have been drawn up prior to the adoption of the euro, will continue to enjoy legal validity.

The fact that a change of currency may occur throughout the life of the contract will have absolutely no effect on, and cannot give rise to any change to the terms of, the agreement itself. There will, therefore, be no scope whatsoever for any party to the agreement to claim an end to their part of the contract or for the agreement to be declared null and void. In addition, there is no need for a clause that states this legal fact to be provided for in the contract or promise of sale agreement, since the principle of continuity of contracts is enshrined in community legislation and will, therefore, automatically have legal status locally.

Naturally, there might be instances where a specific clause has been included in the agreement, which clearly sets out “criteria” for the continued validity of the contract following a change in currency. In such cases, the clause inserted into the contract will take precedence over the general “continuity” principle.

The NECC’s information team is available to provide assistance or guidance wherever necessary. Further details, information and general assistance can be obtained by phoning Linja Ewro 154. People may also visit the website www.euro. gov.mt, where a number of guidelines and other relevant documents can be found and downloaded for the benefit of everyone.

Carine Callus is NECC information officer