Cross-border transfers in euros

Regulation 2560/2001/EC on cross-border payments in euros established as from 1 July 2003 the principle of equal charges for a cross-border transaction and a strictly domestic transaction within the European Union. When a payment is made in euros between two euro accounts, there is no reason why charges should be different if a payment crosses a border. In today's euro area, geographical borders are no longer monetary borders.

The Regulation provides that a cross-border transfer in euros using the IBAN and BIC codes is to be treated in the same way as a domestic transfer. Accordingly, the costs at either end of the transfer must be the same as for domestic transfers.

Which transfers will benefit from the same charges as for domestic transactions?
Transfers that satisfy all the following conditions:

• transfers in euros not exceeding € 12 500 to an EU country;
• the IBAN and BIC codes of the beneficiary must be indicated by the originator on the standard document used by his or her bank (the forms are not identical to those used for domestic transfers);
• originators pay their own costs.

How does the Regulation apply to transactions with EU countries that are outside the euro area?
If a Belgian firm sends a transfer in euros to a UK firm with a euro account, the Regulation is applicable. The payment originator will pay the same charges as for a domestic transfer. If the UK firm makes euro payments to the euro area, the charges to the issuer will be the same as for a euro transfer within the United Kingdom, and costs to the recipient, if any, will be the same as for a domestic transfer.

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