With states discussing the possibility of creating entirely digital currencies, the debate over the place of cash in society has only intensified. That is why the opinion given recently by Giovanni Pitruzella, the advocate general of the Court of Justice of the European Union (CJEU), is of such interest to people concerned with state encroachment on individual freedoms. The main takeaway was that the court found that an individual’s right to pay for services in euro banknotes should be protected, with very limited exceptions to the rule.
Freedom through cash
While the CJEU opinion is non-binding, Pitruzella’s words reinforced arguments around the importance of cash as an emblem of and instrument through which to express personal freedom within the European Union (EU).
“The concept of legal tender as regards euro banknotes […] must be understood as entailing in principle the mandatory acceptance of euro banknotes by the creditor of a payment obligation,” Pitruzella writes.
The ideas that underpin the advocate general’s words concern the importance of cash in protecting individuals from undue controls, as well as the substantive link between cash and the notion of legal tender.
The case under review pertained to a company refusing to accept payments in cash, an issue that has been discussed in different forms across the EU and beyond. Ultimately, Pitruzella argued that in current EU law there is “an obligation on public authorities to accept euro banknotes if they are intended to meet statutorily imposed payment obligations.”
Crucially, he highlighted that although exceptions can be based on grounds of “good faith” or for reasons of the public good, they cannot be based “merely on reasons of administrative practicability or cost savings.”
Pitruzella’s opinion went in favor of two individuals who had been charged late payment fees for refusing to pay a German broadcasting company through one of its preferred forms of payment. The advocate general’s decision has dealt a blow to arguments in favor of eradicating cash, calling into question the imposition of state controls on how and in what form consumers make payments.
Why this opinion is significant
In recent years, public debate has been forced to address the issues which have risen since the emergence of technologically facilitated payment methods, such as debit cards, digital payments and digital currencies.
“Regardless of technological developments and payment method variety, the only truly private transaction, in which no third party (public or private) has a prying eye, is cash,” writes one web journalist.
To understand this, we must acknowledge that there are clear differences between cash and digital means of payment. Cash is not digitally trackable like online payments. Cash requires no intermediary for a transaction to function, nor an infrastructure through which to process that transaction. To use cash is to make a financial choice that requires no ratification from any public or private authority.
