Saturday

23rd Sep 2017

New German complaint aims to further delay bailout fund

  • The Constitutional Court in Karlsruhe has already pushed forward the bailout fund creation until September (Photo: Al Fed)

A new legal challenge filed with the German Constitutional Court on Monday (13 August) calls on judges to further delay their ruling on the eurozone's permanent bailout fund, pending a verdict by the EU's top court.

The Karlsruhe-based court had already said it would rule on 12 September on six legal challenges lodged against both the permanent, yet-to-be-set-up European Stability Mechanism (ESM) and the treaty on fiscal discipline signed by 25 EU countries.

Thank you for reading EUobserver!

Subscribe now and get 40% off for an annual subscription. Sale ends soon.

  1. €90 per year. Use discount code EUOBS40%
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

But a group of plaintiffs led by German professor Markus Kerber, who already had challenged the Greek, Portuguese and Irish bailouts for allegedly being in breach of EU law, on Monday asked the court to further delay its verdict because a similar complaint has been filed with the Luxembourg-based European Court of Justice.

"As long as the European Court of Justice [ECJ] hasn't taken a final decision on the incompatibility of these treaties, neither the Federal Constitutional Court nor the Federal President must take a decision," Kerber's group, Europolis, said in a statement on its website.

The court on Monday confirmed it had received the complaint, but refrained from commenting on whether it would accept it or not, Die Welt reports.

The prospect of a further delay on the €500-billion-strong ESM fund is already spooking investors, with the German Dax index falling on the news on Monday evening.

But legal experts are sceptical whether Karlsruhe will postpone its 12 September ruling.

"It is not likely that the Constitutional Court changes its schedule just because of a similar case in the European Court of Justice, because the ECJ is not a 'higher instance' (for the German court)," Joachim Wieland, a constitutional expert, told Handelsblatt Online.

"Both decisions are from a legal point of view on parallel tracks and are independent from one another," he added

The case in Luxembourg was filed by Thomas Pringle, an Irish MP, who challenged the ESM in Irish courts for being in breach of EU law.

The Irish Supreme Court, for its part, asked the ECJ for legal advice.

If accepted, the Luxembourg court would take at least "a few months" to rule on the matter, an ECJ spokesman told Financial Times.

The paper also noted that it would be for the first time if the German judges took the ECJ ruling into account, as they have never before asked this court for an opinion on EU-related matters.

Bank agency shuns EU invitations

The EU's banking agency is not visiting cities that want to host the agency post-Brexit "to ensure objectivity". The medicines agency has no such qualms.

Investigation

EU bank accused of muzzling watchdog

An ongoing review of the the European Investment Bank's "complaints mechanism" could make the oversight branch less independent and less effective.

News in Brief

  1. Dutch state appeals ban on taking air-polluting measures
  2. May proposes 2-year transition period after Brexit
  3. May to call on EU's 'sense of responsibility'
  4. Catalonia has 'contingency plans' for independence vote
  5. Last German polls confirm Merkel's lead
  6. EU to step up sanctions on North Korea
  7. Tusk calls 'euro summit' in December
  8. Report: May to seek two-year EU transition

Stakeholders' Highlights

  1. Mission of China to the EUGermany Stands Ready to Deepen Cooperation With China
  2. World VisionFirst Ever Young People Consultation to Discuss the Much Needed Peace in Europe
  3. European Jewish CongressGermany First Country to Adopt Working Definition of Antisemitism
  4. EU2017EEFour Tax Initiatives to Modernise the EU's Tax System
  5. Dialogue PlatformResponsibility in Practice: Gulen & Islamic Thought
  6. Counter BalanceHuman Rights Concerns Over EIB Loan to the Trans Anatolian Pipeline Project
  7. Mission of China to the EUChina Leads the Global Clean Energy Transition
  8. CES - Silicones EuropeFrom Baking Moulds to Oven Mitts, Silicones Are a Key Ingredient in Kitchens
  9. Martens CentreFor a New Europeanism: How to Put the Motto "Unity in Diversity" Into Practice
  10. Access MBAGet Ahead With an MBA Degree. Top MBA Event in Brussels
  11. Idealist QuarterlyIdealist Quarterly Event: Building Fearless Democracies With Gerald Hensel
  12. Mission of China to the EUPresident Xi Urges Bigger Global Role for Emerging Economies