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The shaky legal foundations of European monetary union |
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| Authors: | Martin Howe |
| Institution: | Martin Howe QC is a practicing Queen's Counsel specialising in European law and intellectual property law. |
| Abstract: | A paper currency is underpinned by the power of a state to define and control the issue of legal tender. In legal theory, EMU will centralise this power. But in practice, the legal structure might not be strong enough to enforce currency issue rules against a member state in conditions of crisis. Instability could result if investors move euro balances out of a state's banking system to avoid perceived risk. |
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