The Complementary Local Currency: Brief comments on some legal and economic aspects SUPPLEMENTARY LOCAL CURRENCY The complementary currency is a currency whose use does not preclude the use of another currency (usually legal) in a given community and is a means of exchange, used on a voluntary basis, with which you can exchange goods and services.
It may be legally recognized or not and be used in areas more or less broad and more or less coincide with the territory covered the other currency.
The additional money is accompanied by the fundamental currency - such as the Germanic local currencies with the euro - to be used only for certain aspects and never to replace the key currency.
So the complementary currency is opposed to the alternative currency: a currency, local or not, the use of which excludes the use of another currency (Usually legal) in a given community. It is therefore usually not legally recognized in the same community.
is very important to note that the objective of local complementary currency is to facilitate trade and transactions and not to pursue to achieve a saving or investment.
Since the 90s all over the world has witnessed the development of local currencies and in Italy, in particular, some of them have been created and come together in an association called Archipelago SCEC. (1)
CIRCUIT OF ADDITIONAL LOCAL CURRENCY
can be defined as the circuit of local currency?
Well, we start from a combination and the legal form is that of a simple association or APS (Association for Promoting Social Action).
The members are natural persons and legal entities (eg.: Growers, traders, artisans, professionals, etc ...). The association is free and takes place in the usual manner, after obtaining registration card number and personal data by the member.
Among the members of the trade takes place of goods and services. Such payment is made by euro currency and "local currency" (ML), initially in a ratio 90/10% (eg: a good cost of 100, is paid 90 euro plus 10 units ml). In a
Initially, the percentage of 10% in ML is given to businesses at a discount (a discount of 10%) on goods and services.
The "local currency" is issued by the Association in the form of notes. The methods introduced in the circuit are as follows:
1) Donate to the incoming member. Who joins the Association (the statute provides for the obligation to accept - or part - by the member of "local currency" in payment for goods and services), you'll receive 40 units of ML. The donation is repeated each year, unless the shareholder has not given up the association.
2) Loans. Members have the right to borrow money interest-free financing in ML as the creation of new economic activities in the circuit, which in turn will accept ML.
3) donation. The board of the Association may act in favor of donations ML associations or companies or to members of public bodies on specific projects (eg.: To pay the workers to carry out the resurfacing of a road).
4) Donation Association. The board of the Association may act by donations to herself in ML in a fixed amount to cover operating costs.
At a later stage to the ML can be applied to "road tax" (so-called demurrage) which reduces the time value. This is done through the application of "validation stickers" (so-called stamp-scrip) fincatura on pre-printed on the banknote. The stamps are purchased by members at the Association by paying an amount in euro. The "local currency is not convertible into euro by the Association, but if you take the value (related to trade in the circuit), may be that some members decide to convert it into euro under its responsibility.
A circuit model of local currency similar to that described exist in the U.S. as the "Ithaca Hours."
THE ECONOMIC EFFECTS CURRENCY OF SUPPLEMENTARY The advantages of using the local currency are obvious: greater availability of the means of exchange, the higher velocity of the same; incentive to production of goods and services below, creating liquidity. In addition, this new system allows the creation of regional or local economy that can create new development for economic and social policies.
The acquisition of complementary currency is favored by a discount which actually translates into an advantage for the consumer in the purchase of local products.
Since the complementary currency decreases in value over time (so-called demurrage) can not be used for saving, but for this it has a high circolabilità that promotes the liquidity of money. The merchant benefits from practice because a discount on sales but is offset by the demurrage and in this case who wishes to change the complementary currency to the euro, but if the trader wants to spend the additional money through purchases in circuit, does not lose anything, despite the fact that the discount to the consumer.
The mechanism also allows the demurrage to cushion the risks of inflation.
In reality, the system of complementary currencies in Germany adopted is objectively suitable to be revived in our country as achieving at the same time, together with the benefits of a complementary currency, also a harmonious blend with the existing monetary system. In essence, produces beneficial effects both in the private than on public stimulates the labor resources and underdeveloped productive, create links between citizens and local actors, allows funding for public works and small businesses, promotes democratic participation population to the decision on the local economy, promotes the realization of social and cultural objectives.
In contrast, the Euro appalesa more suitable for trade and international transactions, for the competition, the accumulation and redistribution wealth through savings and investments.
ITALIAN LEGISLATION AND COMMUNITY BEFORE THE ADDITIONAL LOCAL CURRENCY The verification of the legitimacy of the local currency as the existing Italian legislation and Monetary Community itself as indispensable to probe the factual and practical operation of this medium of exchange.
However, the Italian regulatory system yields a limited operation for the creation of local currencies only if the goal is not to violate the rules, but to abide by adopting specific legal behavior.
this regard should be considered different aspects of the Judgement of the Criminal Court of Chieti, 30 August 2000, which withdrew the kidnapping of paper coupons called "Simec", a local complementary currency.
In fact, in this province, the Court found that the activity of those who had implemented the additional money was not unlawful because in it there can be no savings to the destination - that if he actually pursued would lead to the violation art. 47 of the Constitution and the Consolidated Law on Banking - but a peaceful destination of the money to purchase goods.
addition, the Court noted that in the case of Simec was subsisting or profit or any form of financing, in whatever guise.
So the above sentence can only produce good operating margins, as well local complementary currency can be created, provided it does not arise in conduct that the law regarding illegal states.
With regard to Community law, it should be noted that its monetary system is based on the principles of national, with the particularity of its subject.
However, the additional money has already entered into the system through experience, rather than positive, which occurred in Germany and other EU member states.
This circumstance confirms the legitimacy of the increasingly complementary currency even before the EU practice.
shape other than SUPPLEMENTARY LOCAL CURRENCY There are application forms of the local currency other than complementary and alternative currencies such as the need to answer in the negative for the latter.
In my view, these alternative formulas to additional currency, besides not being recommended in management, must be considered taken in violation of the law and as such you should not pursue.
