Decision on Handling Suspect Euro Banknotes and Coins to Protect Against Counterfeiting

Unofficially consolidated version DECISION ON THE HANDLING OF SUSPECT EURO BANKNOTES AND COINS AND OTHER ACTIVITIES AIMED AT PROTECTING THE EURO AGAINST COUNTERFEITING (OGM 35/11 of 21 July 2011, 61/18 of 14 September 2018) I. BASIC PROVISIONS Article 1 This Decision regulates the handling of suspicious euro banknotes and coins and other activities aimed at protecting the euro against counterfeiting. Article 2 Counterfeiting shall mean, within the meaning of this Decision, the following activities: a) any fraudulent making or altering of euro banknotes or euro coins, whatever means are employed; b) the fraudulent uttering of counterfeit euro banknotes or counterfeit euro coins; c) the import, export, transport, receiving or obtaining of counterfeit euro banknotes or euro coins with a view to uttering the same and with knowledge that they are counterfeit; d) the fraudulent making, receiving, obtaining or possession of:

• instruments, articles, computer programmes and any other means peculiarly adapted for the fraudulent making or altering of euro banknotes or coins, or
• holograms or other components which serve to protect euro banknotes and coins against fraudulent making or alteration. This Decision shall apply, without prejudice to the application of provisions of the national Criminal Code, to the protection of the euro against counterfeiting. Article 3 For the purpose of this decision, the following terms and definitions shall apply:

1. Suspected counterfeits of euro banknotes and coins shall mean banknotes and coins which have the appearance of genuine euro banknotes and coins, but which are suspected of being fraudulently made or altered;
2. ‘Counterfeit banknotes' and 'counterfeit coins’ shall mean banknotes and coins denominated in euro which are identified by means of technical analysis to have been fraudulently made or altered;
3. Cash handlers are credit institutions and financial institutions and other entities providing services of processing and disbursement of euro banknotes and coins, authorised bureaux de exchange and any other entities engaged in processing and distribution of euro banknotes and coins to the public, including euro banknotes and coins transport companies, and other economic agents such as

2 traders and casinos engaged on a secondary basis in the processing and distribution to the public of notes via automated teller machines (cash dispensers), within the limit of these secondary activities, as well as the Central Bank of Montenegro (hereinafter: the Central Bank) in pursuing payment system operations. 4) Client shall mean a resident and/or non-resident who hands over to a cash handler euro banknotes and coins suspected of being counterfeits; 5) Technical and statistical data shall mean data by means of which counterfeit banknotes or counterfeit coins may be identified (technical description of type of counterfeit) and data on the number of counterfeit banknotes and counterfeit coins by their origin, in particular geographical; 6) National Centres shall mean the National Counterfeit Centre (NCC), the National Analysis Centre (NAC) and the Coin National Analysis Centre (CNAC). The National Centres shall be established within the Central Bank and they shall develop and implement activities aimed at preventing and detecting counterfeit euro banknotes and coins at the national level and take activities in cooperation with competent authorities and bodies in the country and abroad to prevent counterfeiting and detect counterfeits. Financial institution, within the meaning of paragraph 1 item 3 above, shall be legal persons providing financial services licensed and/or approved by the Central Bank for providing financial services. II. HANDLING OF SUSPECT EURO BANKNOTES AND COINS BY CASH HANDLERS Article 4 Cash handlers shall check the authenticity of euro banknotes and coins both when receiving these from clients and putting them back into circulation. Cash handlers shall check the authenticity of euro banknotes and coins in the manner and in accordance with the procedures prescribed in a decision regulating the authenticity and fitness checking and recirculation of euro banknotes and coins. Article 5 Cash handlers shall, without any delay, temporarily seize and withdraw from circulation all euro banknotes and coins received by them which they know or have sufficient reason to believe to be counterfeit. Cash handlers shall issue a receipt for all temporarily seized euro banknotes and coins in the form, which is enclosed in Annex 1 to this Decision and makes an integral part thereof. Article 6 Cash handler shall submit temporarily seized euro banknotes and coins to the National Counterfeit Centre together with the request for technical analysis of the euro banknotes and coins to determine the authenticity thereof. The request shall be submitted in the form, which is enclosed in Annex 2 to this Decision and makes an integral part thereof.

3 Article 7 Should the technical analysis prove that the euro banknotes and coins are not counterfeits, the National Counterfeit Centre shall return the temporarily seized euro banknotes and coins to the cash handler. The cash handler shall, at the earliest possible time, inform the client abut the results of the technical analysis and invite him to take over the temporarily seized euro banknotes and coins. III. NATIONAL CENTRES Article 8 The National Counterfeit Centre shall:

• collect technical and statistical information about counterfeit euro banknotes and coins, establish the counterfeit monitoring system, and allow access to the data on counterfeits in accordance with this decision and other regulations;
• establish all technical and statistical information relating to counterfeit euro banknotes and coins within the counterfeit monitoring system, including a detailed content of the database on seized and detected counterfeits with their detailed images, functions necessary to administer the system, the network and communications, as well as security standards;
• prepare and communicate information on new counterfeit euro banknotes and coins that are subject of cooperation with competent authorities in the country and abroad;
• participate in the preparation and implementation of the agreements with the competent authorities in the country and abroad on cooperation in the areas of prevention and detection of counterfeiting and for cooperation with manufacturers of devices for verifying the authenticity of banknotes.

Article 9 National Analysis Centre shall:

• perform technical analysis of suspected counterfeit euro banknotes and prepare reports thereof;
• classify counterfeits;
• prepare reports on counterfeiting of euro banknotes;
• store all samples of detected counterfeit banknotes;
• participate in the preparation and implementation of the agreements with the competent authorities in the country and abroad on cooperation in the areas of prevention and detection of counterfeiting and for cooperation with manufacturers of devices for verifying the authenticity of euro banknotes;
• organise and carry out the training of employees of cash handlers and all other interested parties handling euro banknotes in order to prevent and detect counterfeits. Article 10 Coin National Analysis Centre shall:
• perform technical analysis of suspected counterfeit euro coins and prepare reports thereof;
• classify counterfeits;

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• prepare reports on detected counterfeit euro coins;
• store samples of detected counterfeit euro coins;
• participate in the preparation and implementation of the agreements with the competent authorities in the country and abroad on cooperation in the areas of prevention and detection of counterfeiting and for cooperation with manufacturers of devices for verifying the authenticity of euro coins;
• organise and carry out the training of employees of cash handlers and all other interested parties handling euro coins in order to prevent and detect counterfeits. IV. HANDLING OF SUSPECT COUNTERFEIT EURO BANKNOTES AND COINS BY THE NATIONAL CENTRES Article 11 The National Counterfeit Centre shall accept temporarily seized euro banknotes and coins, for which there is reason to believe to be counterfeit, from cash handlers and the government authority responsible for the police affairs, as well as from other persons. The National Counterfeit Centre shall send to technical analysis euro banknotes and euro coins received under paragraph 1 above to the National Analysis Centre and the Coin National Analysis Centre, respectively. The National Analysis Centre and the Coin National Analysis Centre shall prepare respective reports on technical analysis of temporarily seized euro banknotes and coins using the forms, which are enclosed in Annex 3 and Annex 4 to this Decision and make integral parts thereof. They shall submit these reports to the National Counterfeit Centre which shall forward them to the cash handler or another person that has submitted the suspect counterfeit euro banknotes and coins. Counterfeit euro banknotes shall be kept in the National Analysis Centre and the counterfeit euro coins shall be kept in the Coin National Analysis Centre. Article 12 Counterfeit euro banknotes and coins shall be ranked as per the quality of their making and/or similarity to the genuine euro banknotes and coins as follows:

1. poor quality counterfeit,
2. medium quality counterfeit,
3. good quality counterfeit,
4. very good quality counterfeits,
5. finest quality counterfeit. Article 13 The National Counterfeit Centre shall deliver the samples of counterfeit euro banknotes and coins at a written request of the government authority responsible for the police affairs, courts or the prosecutor’s office. The National Analysis Centre and Coin National Analysis Centre may deliver the samples of counterfeit euro banknotes and coins to the European Central Bank and the European Commission - Directorate-General for Economic and Financial Affairs (DG ECFIN)/ European Technical and Scientific Centre (ETSC) for the purpose of their classification and verification.

5 Article 14 For the purpose of controlling and adjusting the devices for authenticity checking of euro banknotes and coins, the National Centres may, at a written request of a cash handler, give for temporary use the samples of counterfeit euro banknotes and coins. Article 15 The Central Bank shall retain counterfeit euro banknotes and coins without compensation. Article 16 The National Analysis Centre and the Coin National Analysis Centre shall organise training for authenticity checking of euro banknotes and coins for employees of cash handlers. V. COOPERATION AND ASSISTANCE Article 17 With a view to ensuring efficient protection of euro banknotes and coins against counterfeiting, the National Centres shall cooperate with cash handlers and the competent national authorities. The National Centres shall cooperate, in the performance of their respective tasks, in particular with the government authority responsible for the police affairs in: -exchanging information on preventing counterfeiting and combating the uttering of counterfeit banknotes and counterfeit coins; -providing regular information on the impact of counterfeiting for the purposes of strategic analysis; -ensuring mutual assistance in preventing counterfeiting and combating the uttering of counterfeit banknotes and counterfeit coins, which shall include, inter alia, scientific support and training with the logistical support . The National Centres shall make available information of the emergence and features of counterfeit euro banknotes and coins to the public authority in charge of police affairs. Article 18 The National Counterfeit Centre shall establish cooperation with foreign authorities and bodies responsible for the prevention of counterfeiting and detecting counterfeits and the national centres of other countries. With a view to accomplishing the cooperation specified under paragraph 1 above, the National Analysis Centre shall cooperate with the European Central Bank (ECB) and the ECB`s Counterfeit Analysis Centre (CAC), while Coin National Analysis Centre shall cooperate with the European Commission - Directorate-General for Economic and Financial Affairs (DG ECFIN) and the European Technical and Scientific Centre (ETSC).

6 VI. GOVERNING PROVISIONS Article 19 The provisions of this Decision shall apply accordingly to the handling of suspicious samples of banknotes and coins other than euro. VII. TRANSITIONAL AND FINAL PROVISIONS Article 20 The National Centres shall start exercising the competences specified herein no later than within one year following the day of its entry into force during which period all necessary activities shall be taken to ensure the functioning of the National Centres at the national level. Tasks and activities specified under this Decision with regard to the suspect counterfeits of euro banknotes and coins shall be performed by the Central Bank – the Vault until the National Centres start exercising the competences specified herein. Article 21 This Decision shall enter into force on the eighth day following that of its publication in the Official Gazette of Montenegro. THE COUNCIL OF THE CENTRAL BANK OF MONTENEGRO

7 Annex 1

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(Name of cash handler or another person) RECEIPT FOR TEMPORARILY SEIZED MONEY This is to confirm that the suspected counterfeit money was temporarily seized from (name and last name, personal ID number or passport number and citizenship, address and contact details￾telephone number)

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Temporarily seized money suspected of being counterfeit: BANKNOTES Curre ncy Denomi nation Serial number No of pieces

The money seized will be delivered to the Central Bank of Montenegro - National Counterfeit Centre for technical analysis and authenticity verification. We will inform you on the results once we receive the report of the technical analysis. Place and date: _______________________________ (of temporary seizure of money) Receipt received by: Place for stamp Receipt issued by:

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(signature) COINS Curre ncy Denomina tion Year of minting No of pieces

8 Annex 2

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(Name of cash handler or another person) Registry No: ____________ Place and date: ___________ R E Q U E S T FOR TECHNICAL ANALYSIS OF MONEY TO DETERMINE ITS AUTHENTICITY Date and place of detecting suspect counterfeit money Date: Place: Details on circumstances of detecting suspect counterfeit money: Information on the person suspected of uttering the counterfeit money and/or the person requesting its authentication Name and last name: Address: Contact telephone: Personal ID number or passport number and citizenship Data on the cash handler paying in suspected counterfeit money: Name, head office and organisational unit: Contact telephone: Place for stamp

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(signature of authorised person) BANKNOTES Curren cy Denomin ation Serial number No of pieces COINS Currenc y Denomin ation Year of minting No of pieces

9 Annex 3 CENTRAL BANK OF MONTENEGRO National Analysis Centre / Coin National Analysis Centre 1 Podgorica, _____________ year No.__________ REPORT ON TECHNICAL ANALYSIS OF DELIVERED MONEY SUSPECTED OF BEING COUNTERFEIT Pursuant to the request _____________________________________________ no. __________ as of _________, the following technical analysis has been performed: It has been determined that the money concerned is COUNTERFEIT of known – new type of

1. poor quality, 2) medium quality, 3) good quality, 4) very good quality, 5) finest quality DESCRIPTION OF COUNTERFEIT MONEY Counterfeit money of this type was registered: a) with the European Central Bank, where it is recorded as the type: indicative: b) with the Central bank of Montenegro, where it is recorded as the type: indicative: The place, date and circumstances of detecting suspected counterfeit money, according to information in the request: Place for stamp

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(signature of authorised person)

1 The National Analysis Centre prepares a report on technical analysis of euro banknotes and the Coin National Analysis Centre prepares a report on technical analysis of euro coins.

10 Annex 4 CENTRAL BANK OF MONTENEGRO National Analysis Centre / Coin National Analysis Centre2 Podgorica, _____________ year No.__________ REPORT ON TECHNICAL ANALYSIS OF DELIVERED MONEY SUSPECTED OF BEING COUNTERFEIT Pursuant to the request _____________________________________________ no. __________ of _________, the following technical analysis was performed: It has been determined that the respective money is GENUINE. NOTE Place for stamp

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(signature of authorised person)

2 The National Analysis Centre prepares a report on technical analysis of euro banknotes and the Coin National Analysis Centre prepares a report on technical analysis of euro coins.