Joining the euro area

Joining the euro area means joining the world's second-largest reserve currency and the second most-traded currency.

To adopt the euro, countries must meet the criteria established in the 1992 Maastricht Treaty, commonly referred to as the 'Maastricht criteria'.

Those economic and legal requirements were established in order to ensure that member states are ready to adopt the euro and function smoothly in the euro area.

Bulgaria is the latest country to have joined the euro area, introducing the common currency on 1 January 2026.

International role of the euro

Opt-out clauses

All EU member states are in principle obliged to introduce the euro once they fulfil the convergence criteria. The only exception is Denmark, which has an 'opt-out clause' in the EU treaties, exempting the country from the obligation to adopt the euro.

Denmark may, however, apply for euro area membership if it ever chooses to do so.

_{Conditions for joining}

To join the euro area, EU countries must meet specific preconditions:

economic convergence criteria
legal convergence

Economic convergence criteria

Price stability

Sustainable interest rate

Sustainable public finances

Stable exchange rates

Price stability

The country must demonstrate a sustainable price performance, with an average inflation rate (observed over a period of one year) of no more than 1.5 percentage points above the rate of the three best-performing member states.

Sound and sustainable public finances

the planned or actual government deficit should not exceed 3% of GDP
the government debt ratio should not be higher than 60% of GDP

Long-term interest rates to assess the durability of convergence

The country’s average nominal long‑term interest rate should not exceed that of the three best performing member states by more than 2 percentage points.

Exchange rate stability to demonstrate the economy can withstand currency fluctuations

The country must participate in the exchange rate mechanism (ERM II) for at least two years:

without significant deviations from the ERM II central rate
without devaluing its currency’s bilateral central rate against the euro

The purpose of the exchange rate mechanism (ERM II) is to demonstrate that a country's economy can function smoothly without recourse to excessive currency fluctuations.

When a non-euro area country enters the ERM II, its national currency is tied to the euro at a central rate that is agreed with the euro area member states, the non-euro area countries already participating in ERM II and the ECB, with the involvement of the Commission. The currency is then allowed to fluctuate within the standard limit of 15% above or below this agreed central exchange rate.

Since ERM II is a precondition for introducing the euro, all non-euro area member states except Denmark are expected to join the mechanism at some stage.

Since 2018, countries willing to join ERM II are also expected to have entered into close cooperation with the European Central Bank’s single supervisory mechanism and to have implemented specific policy commitments.

Legal convergence

Candidates wishing to join the euro area must also ensure that national legislation is compatible with the Treaty and Statute of the European system of central banks (ESCB) and the ECB.

The Treaty and Statute provide for the independence of central banks.

Evaluating the country's readiness: convergence reports

At least every two years, the European Central Bank (ECB) and the European Commission examine whether the non-euro area member states (the so-called 'member states with a derogation') fulfil convergence criteria and therefore are ready to introduce the euro. They each issue a convergence report presenting their findings.

The reports are submitted to the Council of the EU for examination and to inform possible subsequent decisions.

The ECB and the Commission can also prepare such a report at any time upon a request by a non-euro area country that wants to join the euro area.

Decision on introducing the euro

The Council of the EU decides whether a country can introduce the euro.

The Council adopts such a decision after:

it has received a proposal from the Commission
it has received a recommendation from the euro area member states
it has consulted the European Parliament
a discussion has taken place in the European Council

The final decision is taken by all EU member states. In EU legislation, this is referred to as the 'abrogation of the derogation'.

Fixing the exchange rate

In addition, the Council of the EU irrevocably fixes the rate at which the euro substitutes the currency of the member state.

The Council takes this decision based on a proposal from the Commission, and after consulting the European Central Bank.

The decision is taken by the euro area member states and the country introducing the euro voting unanimously in the Council.

The role of the euro area member states

The euro area countries give a recommendation to the Council of the EU on whether a particular country is ready to adopt the euro.

The euro area member states have to issue the recommendation within six months after the Council has received the Commission's proposal on the introduction of the euro in a member state.

The recommendation has to be adopted by a qualified majority of the euro area member states.

Responsibilities when joining

Adopting the euro involves:

permanently fixing the exchange rate between the national currency and the euro
transferring responsibility for monetary policy to the European Central Bank
member states are expected to participate in coordinated crisis management, including providing financial assistance to other euro area countries when needed, to ensure stability.
governments should inform and educate their citizens about the changes associated with joining the euro area, including the implications for everyday life, the benefits and the challenges involved.
closer coordination of national budgetary policies. Every year in October, euro area member states submit their draft budgetary plans for the following year to the Commission for assessment. Sanctions can be imposed on euro area member states if they fail to comply with the criteria related to sound and sustainable public finances.

How to join the euro area