Tagged: EFSF

POMFR: What form of government for the European Union and the Eurozone? (Fabbrini et al, eds.; Hart Publishing 2015).

By Daniela Jaros

A couple of months ago, an interesting volume edited by Federico Fabbrini, Ernst Hirsch Ballin and Han Somsen entitled „What form of government for the European Union and the Eurozone?“ appeared on the EU law book market. Containing contributions of many renowned scholars of EU law and EU politics, it seeks to explore the impact of the Euro-crisis on the institutional setting, the distribution of competences and the balance of power as well as issues of legitimacy and accountability within the Eurozone and ultimately within the European Union. Continue reading

The AG’s opinion on the Outright Monetary Transactions Case

By Daniela Jaros

On January 14, Advocate General (AG) Cruz-Villalón issued his opinion in the reference for a preliminary ruling on Gauweiler et al. v Deutscher Bundestag on the ECB’s Outright Monetary Transactions (OMT). The OMT Programme launched in September 2012 was part of a series of measures taken by the ECB in response to the Euro crisis accompanying the loan facilities (European Financial Stability Facility – EFSF, European Stability Mechansim – ESM).

The German Constitutional Court (Bundesverfassungsgericht, “BVerfG”) had asked the Court of Justice (CJEU) two questions in what it classified as an ultra vires review of acts of the European Union. Roughly speaking, the BVerfG wanted to check whether the European Central Bank (ECB) had transgressed the limits of its powers derived from the treaties. If the ECB had, this would have consequences for the constitutional identity of Germany. Therefore, the BVerfG first wanted clarification on whether the Outright Monetary Transactions (OMT) Programme was an economic rather than a monetary measure and whether the ECB had therefore exceeded its powers by establishing it.  Second, the BVerfG raised the question whether the OMT programme was not violating the prohibition of monetary financing of Member State. Continue reading

The German Federal Constitutional Court on Outright Monetary Transactions by the European Central Bank – pressing the CJEU or a friendly gesture?

On Friday, February 7th, 2014, the German Federal Constitutional Court (BVerfG) requested the CJEU for preliminary ruling for the first time. The request is exceptional in terms of both European Union law and German constitutional law. Commentators call the decision a Spring in the Desert, a Golden Bridge to Luxembourg or simply put Historic. The BVerfG stated its opinion throughout several decisions regarding fundamental questions between the European Union and its Member States (e.g. Solange I, Solange II, Maastricht, Lisbon), but always abstained from requesting a preliminary ruling. This time, however, the BVerfG indeed submitted a question. The stakes in the case are high, as the BVerfG considers giving an ultra vires ruling regarding a decision by the Governing Council of the European Central Bank (ECB) concerning Outright Monetary Transactions (OMT) unless the CJEU announces that that decision is partially incompatible with primary law or restricts its scope. If the “conditions” laid out by the BVerfG are not met by the CJEU, the decision on OMT will be declared incompatible with the German constitution. The consequence would be that German authorities would not be bound to the decision by the ECB. In other words, the German central bank with around 18 % in capital subscriptions (shares) of the ECB would not participate in OMTs. Continue reading