Brussels: Europe and the Arabs
From Sunday, January 1, 2023, Croatia will adopt the euro as its currency and fully join the Schengen area. This represents an important milestone in the history of Croatia, the Eurozone, the Schengen Area and the European Union as a whole. It comes after a period of intense preparation and great efforts by Croatia to meet all the necessary requirements. According to a statement issued in Brussels on Friday
The Commission has fully supported Croatia in the process of joining the Eurozone and the Schengen Area. With Croatia, 20 EU member states and 347 million EU citizens will share the EU's single currency. As for Schengen, this is the eighth expansion and the first after 11 years.
The euro will offer practical benefits to Croatian citizens and businesses. It will make traveling and living abroad easier, enhance transparency and competitiveness of markets, and facilitate trade. Euro banknotes and coins will also become a tangible symbol for all Croats of the freedom, comfort and opportunities offered by the European Union. Overall support for the Euro in the Eurozone remains very strong, with the vast majority of EU citizens believing that the Euro is good for the EU as a whole and their country.
The Schengen Area allows 420 million people to travel freely between member states without going through border controls. It allows the establishment of joint and joint responsibility for the control of the Union's external borders and responsibility for the issuance of joint Schengen visas. Above numbers, for more than 35 years now, Schengen has been a domain of values, freedom, security and justice. Particularly in the current geopolitical and economic context, the Schengen Area is fundamental to stability, resilience, and recovery.

Enter the euro

From Sunday, January 1, 2023, the euro will gradually replace the kuna as the currency of Croatia. In keeping with an established record of exchange rate stability, the kuna will be exchanged at the conversion rate of 1 euro for 7.53450 kuna. The two currencies will be used in tandem for two weeks. Upon receipt of a payment in kunas, change will be given in euros. This will allow the gradual withdrawal of kuna from circulation.
The dual display of prices in Kuna and Euro became mandatory on September 5, 2022 and will apply until December 31, 2023. In order to protect consumers and address their concerns about unjustified price increases in the period of change, the Code of Business Ethics was introduced to ensure stable prices of goods and services by helping companies to Correctly recalculate and display prices. Companies that have signed up to the initiative can display their logo to reassure customers, and will lose that right if they are found to be in violation of the rules. The Code of Ethics is enforced by the State Inspectorate, which will also monitor the prices of frequently purchased products and services during the change.
Commercial banks received euro banknotes and coins in advance from the Croatian National Bank and in turn provided euro cash to other stores and businesses. Kuna banknotes and coins can be exchanged for euro banknotes and coins at the financial agency and post offices until June 30, 2023. The exchange is free. Kuna banknotes and coins can be exchanged at commercial banks until December 31, 2023. They are free for all exchanges made before July 1, 2023 with a limit of 100 banknotes and 100 kuna. For changes from July 1, 2023, commercial banks can charge a fee. The Central Bank of Croatia will exchange kuna coins without time limit and kuna coins until December 31, 2025. This service is free.
70% of automatic teller machines (ATMs) in Croatia will already dispense euro banknotes on January 1, 2023, and the rest will follow as soon as possible thereafter (within two weeks). To facilitate the process, commercial banks will publish information online on which ATMs dispense euros.

Schengen area

The Schengen area is one of the most important achievements of the European project. It began in 1985 as an intergovernmental project among five European Union countries - France, Germany, Belgium, the Netherlands and Luxembourg - and has gradually expanded into the world's largest free travel area.
An expanded Schengen area without internal border controls will make Europe safer, by strengthening the protection of our common external borders and effective police cooperation; more prosperous, by eliminating lost time on borders and facilitating communications between people and businesses; And even more attractive, by dramatically expanding the world's largest joint area without internal border controls.
Since joining the European Union in 2013, Croatia has implemented parts of the Schengen Agreement, including those related to external border controls, police cooperation and the use of the Schengen Information System.
The remaining parts of Schengen acquisitions, which include lifting Internal border controls and related measures, effective from January 1, 2023: Checks at the internal land and sea borders between Croatia and other countries of the Schengen area will be lifted. Domestic air border checks will be lifted from March 26, 2023, due to the need to coincide with IATA summer/winter timetable dates.

In line with the Schengen Assessment and Control Regulation, Croatia will be assessed within one year from the date of full application of the Schengen acquisitions. This regulation has recently been amended to enhance the assessment of respect for fundamental rights under the Schengen Acquisitions.

In its 2022 Convergence Report, the committee concluded that Croatia met the criteria for adopting the euro. This assessment was supported by the European Central Bank's Convergence Report. In July 2022, the EU Finance Ministers took the official decision that opened the way for Croatia's adoption of the euro.

The Croatian authorities have made extensive preparations for the country's entry into the Eurozone by implementing their National Change Plan, providing all the details of organizing the introduction of the Euro and the withdrawal of the Kuna.

The basic principle of the National Change Plan in Croatia is consumer protection. Mechanisms for building a safe environment for consumers have been carefully planned under four pillars: a code of ethics, monitoring prices of goods and services, supervision of merchants and service providers, and dual pricing.

Many retailers, public companies and service providers have signed up to the code of ethics launched by the authorities to ensure that the conversion of prices into euros takes place fairly and without price increases. Double price display became mandatory on 5 September. It will expire 12 months after the date of introduction of the Euro (December 31, 2023). Prices of 103 pre-defined products and services that are purchased most frequently are monitored during changeover.

Euro Code provides a code of ethics with the necessary regulatory framework. It identifies the State Inspectorate as the main body for monitoring and controlling prices and contains provisions on the correct double presentation of prices, respect for rounding rules, and the correct application of conversion rate. If the provisions of the "Euro Law" are violated, the State Inspectorate can first issue orders to merchants or economic operators to address the non-compliance; The next step will be sanctions. In parallel, and if necessary, consumer associations will publish “black lists” of commercial entities that violate the principles of the Code of Ethics.

Preparations for the transition were complemented by a comprehensive communication campaign by the Croatian authorities. The Commission and the European Central Bank have contributed to these efforts.

Regarding accession to Schengen, already in December 2021 the Council confirmed that Croatia had fulfilled the conditions for accession to the Schengen Area. The assessment took place from 2016 to 2020. It included a successful targeted verification visit in 2020 to verify the implementation of procedures in external border management. This came after the Commission confirmed that Croatia had successfully completed the Schengen assessment process in 2019.