New Caledonia, French Polynesia and Wallis and Futuna share the CFP franc. Currency is a State competence in all three statutes, so none can legislate on it. All three were consulted before the decree carrying the parity, but a protocol annexed to the European Union treaties records that France alone determines it.
A shared currency normally implies a shared decision. The CFP franc is the case where it does not. Three French Pacific collectivities use it, under two different parts of the French Constitution and three separate statutes, and in all three the currency is a State competence. They are consulted. None of them votes.
Key Takeaways
- New Caledonia has its own title in the French Constitution; French Polynesia and Wallis and Futuna share article 74.
- Currency is reserved to the State in each of the three statutes.
- New Caledonia is consulted on monetary decisions, French Polynesia is informed of them, and Wallis and Futuna's statute says nothing about currency.
- The decree carrying the parity records opinions from all three, and is signed by four members of the French government.
- A protocol annexed to the European Union treaties says France alone determines the parity.
Three collectivities, three different constitutional statuses
The three users of one currency are not governed alike, and the difference is constitutional.
Article 72-3 of the French Constitution assigns the overseas territories to governing articles. French Polynesia and the islands of Wallis and Futuna fall under article 74, which covers overseas collectivities with their own statutes. New Caledonia is handled separately in the same provision: its status is governed by Title XIII. That title exists because of the Noumea Accord of 5 May 1998, which article 76 then put to a vote of the population.
The labels are not reliable guides to what they contain. French Polynesia's organic law calls it a pays d'outre-mer, the grandest-sounding of the three titles. Reviewing that law in 2004, the Conseil constitutionnel held that the designation carries no legal effect. A name and a competence are different things.
Does any of the three decide anything about the currency?
No, and each statute gets there differently.
New Caledonia. Its organic law of 19 March 1999 lists the matters in which the State is competent, and the fifth is currency, credit, exchange, external financial relations and the Treasury. A second list sets out the competences the congress may ask to have transferred to it later: provincial and communal administration, the financial regime of public bodies, higher education, audiovisual communication. Currency is not on it.
French Polynesia. Its organic law of 27 February 2004 works the other way round. The territory's authorities are competent in every matter not devolved to the State, and the State is competent in what the law calls the sole following matters. The seventh is currency, credit, exchange, the Treasury and financial markets.
Wallis and Futuna. The law of 29 July 1961 does not use the word currency at all. It lists what the Republic assures: defence, public order, external relations, education, the working of the Treasury and customs. The assembly's own powers are imported from a 1957 decree enumerating the domains on which it must be consulted, and currency is not among them. Two statutes exclude the currency by naming it. The third excludes it by never mentioning it.
What consultation actually amounts to
All three are consulted, and the decree carrying the parity proves it in its own opening citations: an opinion from the government of French Polynesia dated 27 May 2022, one from the government of New Caledonia dated 1 June 2022, and a referral to the territorial assembly of Wallis and Futuna dated 9 May 2022.
What they are worth differs, and the gap between two of them is a single verb.
New Caledonia's organic law provides at article 133 that the government is consulted on draft decrees specific to New Caledonia, and separately on decisions concerning monetary policy and credit. The same article sets a limit of one month, fifteen days if urgent, at the expiry of which the opinion is deemed given. Silence completes the consultation.
French Polynesia's law is narrower where it matters most. Its council of ministers is consulted on draft regulatory decrees specific to French Polynesia. On monetary matters, article 100 provides that it is informed of the decisions taken by the authorities of the Republic. Not consulted. Informed.
| Collectivity | Status | Monetary provision in its statute |
|---|---|---|
| New Caledonia | Constitution, Title XIII | Consulted on decisions concerning monetary policy and credit |
| French Polynesia | Constitution, article 74 | Informed of monetary decisions taken by the Republic |
| Wallis and Futuna | Constitution, article 74 | None |
Who signs
The parity sits in the Code monetaire et financier, and got there in three steps.
A decree of 16 December 1998 set the method rather than the number, giving a formula that converted the existing franc parity into euros. An order of 31 December 1998 fixed the figure it produced. The parity in force today was placed in the Code by a decree of 23 November 2022, made by the President of the Republic on the report of the Prime Minister and the Minister for the Economy, and carrying four signatures: the President, the Prime Minister, the Minister for the Economy, and the Minister of the Interior and Overseas. None of the four is a Pacific office.
The collectivities were not ignored: their opinions are cited on the face of the instrument. But citing an opinion and holding a vote are different acts, and this arrangement does the first.
Why the European Union does not decide it either
Because a protocol annexed to the treaties took the question off the table. Protocol No 18 on France says that France will keep the privilege of monetary emission in New Caledonia, French Polynesia and Wallis and Futuna under the terms established by its national laws, and will be solely entitled to determine the parity of the CFP franc. Twenty-seven member states have signed a treaty recording that one of them decides this alone.
The three are listed in Annex II to the Treaty on the Functioning of the European Union as overseas countries and territories, which article 355(2) associates with the Union rather than making part of it. That is a different category from the outermost regions, which the Treaty covers in full.
The contrast is dated and documented. On 31 December 1998 the Council decided the monetary arrangements for Saint-Pierre-et-Miquelon and Mayotte, recording that they form an integral part of France but not of the Community, and providing that the euro shall be their currency. In the same fortnight it legislated nothing for the Pacific three. The CFP franc needed no such decision: the protocol had already placed it outside the Union's reach.
What changing it would take
A long sequence, and unanimity among the three. A report to the French National Assembly in January 2010 set out the procedure: a formal request from the three collectivities, a request from France to the European Commission, a Commission recommendation, an opinion from the European Central Bank, a Council decision, and a monetary convention. The change is possible only simultaneously in all three, with the formal agreement of each.
The most recent official statement is blunter. Answering a written question on 21 March 2023, the French economy ministry said moving the Pacific collectivities to the euro is not today a scenario contemplated either by the State or by the collectivities themselves.
Where the arrangement leaves the three
With a currency following a monetary policy decided elsewhere, in a zone whose own statute calls it the State's. The Code monetaire et financier provides that the issuing institute implements the monetary policy of the State in the CFP franc zone. Because the parity is fixed and capital moves freely with mainland France, the institute's annual report notes that its policy has to take account of the policy conducted at European level by the European Central Bank.
The asymmetry inside the zone is worth one figure. The institute's counters handled a flow of banknotes in 2023 that split 53 per cent New Caledonia, 46 per cent French Polynesia and 1 per cent Wallis and Futuna. The smallest holds a seat on the supervisory board alongside the other two, and the same absence of a vote.
Where to look next
The AUD to XPF page carries the live reference rate and a short block on the institution that issues the CFP franc. For a monetary union whose members do vote, one currency, twenty-one governments covers who decides and how a country joins. For what a country gives up by anchoring to somebody else's money, what it means to import another country's monetary policy sets out the trade. For the arrangement itself, rather than who decides it, see currency peg.
Sources
- Constitution of 4 October 1958, article 72-3 (Legifrance) - French Polynesia and Wallis and Futuna under article 74, New Caledonia under Title XIII
- Loi organique n° 99-209 du 19 mars 1999, New Caledonia (Legifrance) - article 21 I 5 reserving currency, credit, exchange and the Treasury to the State; article 27's list of competences the congress may request, which omits currency; article 133 on consultation, the deemed opinion, and the power to express wishes
- Accord de Noumea, 5 May 1998 (Legifrance) - point 3.3, keeping justice, public order, defence and currency, with credit and exchange, as State competences
- Loi organique n° 2004-192 du 27 fevrier 2004, French Polynesia (Legifrance) - article 13's residual competence, article 14's exhaustive State list with currency at item 7, and article 100 providing that the council of ministers is informed of monetary decisions
- Conseil constitutionnel, decision n° 2004-490 DC du 12 fevrier 2004 - considerant 13, that the designation pays d'outre-mer carries no legal effect
- Loi n° 61-814 du 29 juillet 1961, Wallis and Futuna (Legifrance) - article 7 on what the Republic assures, which omits currency
- Decret n° 2022-1456 du 23 novembre 2022 (Legifrance) - the two opinions and the referral cited on the face of the instrument, and its four signatures. The parity was converted by decret n° 98-1152, setting the formula, and fixed by the arrete of 31 December 1998
- Protocol (No 18) on France, annexed to the EU treaties (EUR-Lex) - France keeping the privilege of monetary emission in the three collectivities and being solely entitled to determine the parity
- Treaty on the Functioning of the European Union, Annex II (EUR-Lex) - the three listed as overseas countries and territories, associated under article 355(2)
- Council Decision 1999/95/EC of 31 December 1998 (EUR-Lex) - Saint-Pierre-et-Miquelon and Mayotte an integral part of France but not of the Community, with the euro made their currency
- Assemblee nationale, rapport d'information n° 2270, 27 January 2010 - the procedure for introducing the euro, possible only simultaneously in all three
- Assemblee nationale, question ecrite n° 5549, answered 21 March 2023 - that the change is not a scenario contemplated by the State or the collectivities
- Code monetaire et financier, article L721-18 (Legifrance) - the institute implementing the monetary policy of the State in the CFP franc zone
- Institut d'emission d'Outre-Mer, Rapport d'activite 2023 - the 2023 split of counter flows, and the institute taking the European Central Bank's policy into consideration
General information about how the CFP franc is governed. Not financial advice, and not a recommendation of any product or institution. Reviewed by the Tradergy editorial team, September 2026.
Common questions
Which places use the CFP franc?
New Caledonia, French Polynesia, and the islands of Wallis and Futuna. They are three separate French collectivities, and the currency is the main thing they have in common institutionally. Their constitutional statuses differ from one another: the French Constitution places French Polynesia and Wallis and Futuna under one article and carves New Caledonia out into a title of its own.
Can any of the three change the exchange rate?
No. Currency is reserved to the State in each statute. New Caledonia's organic law lists currency, credit, exchange, external financial relations and the Treasury among the State's competences, and the separate list of competences its congress may ask to have transferred does not include currency. French Polynesia's organic law reserves currency, credit, exchange, the Treasury and financial markets in the same way.
Are the collectivities consulted at all?
Yes, and the decree that carries the parity today records it. Its opening citations list an opinion from the government of French Polynesia dated 27 May 2022, an opinion from the government of New Caledonia dated 1 June 2022, and a referral to the territorial assembly of Wallis and Futuna dated 9 May 2022. All three are opinions or referrals rather than votes.
Does the European Union have a say?
No. A protocol annexed to the European Union treaties records that France keeps the privilege of monetary issue in the three collectivities under its own national law and will be solely entitled to determine the parity of the CFP franc. The three are associated overseas countries and territories rather than part of the Union, so the euro was never extended to them.
Could the CFP franc be replaced by the euro?
Only through a long procedure and only in all three at once. A 2010 report to the French National Assembly set the sequence out: a formal request from the three collectivities, then a request from France to the European Commission, a Commission recommendation, an opinion from the European Central Bank, a Council decision and finally a monetary convention. Answering a written question in March 2023, the French economy ministry said the change was not a scenario contemplated by the State or by the collectivities themselves.