Andorra and the euro

Andorra has a monetary agreement with the EU allowing it to make the euro its official currency, and permitting it to issue euro coins as early as 1 July 2013. They planned to issue their first coins by March or April 2014. On 23 December coins were delivered for pre-booked customers at the Government Administration Building, while actual circulation started on 15 January 2015.

Andorra did not have an official currency prior to adopting the euro, and unlike its two larger neighbours, France and Spain, which surround it, it is not a member of the EU. However it de facto used the EU's euro (the currency of the Eurozone states) as it had historically used the French franc and Spanish peseta. When those two currencies were replaced by the euro in 2002, the euro replaced the franc and peseta as the sole circulating currency in Andorra.

Unlike the three other European microstates outside of the EU, Monaco, San Marino and the Vatican City, which adopted the euro when it was introduced, Andorra did not conclude a monetary agreement with the EU but rather used it unilaterally. These agreements gave the three microstates the right to issue their own euro coins, which have a common design on one side, and a national-specific side on the other. As with coins minted in other eurozone states, the microstate coins are valid across the eurozone; however they do not gain representation on the euro's governing bodies, the European Central Bank (ECB) and the Eurogroup. In 2003 Andorra requested that the EU conclude a monetary agreement with it which would give it the right to mint its own coins.

In 2004 the Council of the European Union adopted its negotiating position with Andorra. Following Andorra's agreement to abide by Council Directive 2003/48/EC on taxation of savings income in the form of interest payments, the Commission recommended opening negotiations. Negotiations were expected to be concluded by 2008, but were repeatedly stalled due in part been to poor relations stemming from Andorra's tax haven status. A monetary agreement was eventually agreed to by Andorra and the EU in February 2011, and the agreement was signed on 30 June 2011. After the agreement came into force on 1 April 2012, the euro became Andorra's official currency. Andorra would have been permitted to issue up to 2.4 million euro coins from 1 July 2013 onwards provided that it complied with the agreement's terms.

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