Sunday

13th Jun 2021

Germany's top court to examine Greek bailout

  • The court will hear the complaints but a decision is not expected for weeks (Photo: Al Fed)

While the EU's struggles to deal with debt-ridden Greece have been a drama played out in Brussels and in Athens, a new front will open on Tuesday (5 July) when Germany's top judges consider whether last year's bailout was legal.

The constitutional court in Karlsruhe will begin hearing arguments in three cases challenging Germany's role in the Greek bailout and the euro-area rescue fund last year.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

Any decisions will only be taken in a few weeks, but the judges could ultimately find that Germany's participation went against the constitution.

Around 50 complaints about the bailout have been lodged with the court. The vast majority have been rejected with 15 remaining. Of these 15, three are now being formally heard.

The plaintiffs include law professor Karl Schachtschneider, economists Joachim Starbatty, Wilhelm Hankel and Wilhelm Noelling and Peter Gauweiler, a centre-right MP. All have previously filed complaints about aspects of Germany's EU participation.

Their main argument this time is that the aid has breached the EU treaty's no bailout clause.

"It violates the basis rules of the European treaties and the structural principles of monetary union - namely the ban taken on the liabilities of other states. The rights and the responsibilities of the European Central Bank have also been infringed," Schachtschneider told the Frankfurter Allgemeine Sonntagszeitung when explaining his reasons for the complaint.

The aid for Greece, according to the lawyer and longterm euro opponent, establishes a liability, debt and finance union which is a "decisive step to a European state".

"But policies are not allowed to dispose of Germany's statehood," he says adding that a "big question" will be the role of the German parliament - which greenlighted the Greek package. "Do we citizens have a right over whether the parliament acts lawfully or only if it acts at all?"

Germany, as Europe's paymaster, pays most of the €110 EU-IMF Greek bailout agreed last year and has the greatest national share of the €750bn rescue fund established to prevent the crisis from spreading further.

With the population increasingly against putting money towards eurozone rescues, chancellor Angela Merkel has been walking a political tightrope.

She has been caught between keeping Germans happy by talking tough on Greece and assuaging the markets who consistently doubted the political will behind the solidarity promises made to Athens.

Merkel came under strong criticism last year for what was seen as a market-jittering delay before she agreed to the first bailout. Her aides later said that she felt constrained by Germany's constitutional court.

The legal arguments in the court are set to centre around whether the EU was right in its use of an article that allows for help of another EU member state in case of exceptional circumstance.

The hearing, which is to be attended by German finance minister Wolfgang Schaeuble, comes just days after EU leaders agreed in principle to a second bailout of Greece, although the details have still to be worked out.

Merkel in election setback amid discontent on euro-crisis

The opposition Social Democrats have won the regional elections in Mecklenburg-Western Pomerania, the home state of German chancellor Angela Merkel, whose popularity is dwindling amid growing discontent over the euro-crisis and the Greek bailouts.

Germany's top court to decide on Greek bailout

Germany’s highest court is on Wednesday due to give its verdict on the legality of Berlin’s contribution to both Greece’s first bailout and the eurozone rescue fund.

Pressure builds on EU to back WTO vaccine-patent waiver

MEPs have backed a motion demanding the temporality lifting of intellectual properties rights of Covid-19 vaccines - a symbolic move that puts pressure on the European Commission to change its position on the issue of global access to vaccines.

Exclusive

MEP office expenses kept secret on dubious evidence

It would require between 40 to 75 additional staff to oversee how MEPs spend their monthly €4,500 lump sum on office supplies, according to the European Parliament. An EUobserver Freedom of Information request reveals those calculations are flawed.

News in Brief

  1. EU top court fast-tracks rule-of-law case to October
  2. Hungary's Fidesz wants to ban LGBTIQ content for under-18s
  3. MEPs join EU citizens on farm-animal cage ban
  4. Council of Europe urges Russia to release Navalny 'immediately'
  5. China's anti-sanctions law alarms EU businesses
  6. Airlines seek to water down EU passengers' rights
  7. EU leaders join call for further probe into Covid origins
  8. Liberal MEPs under fire over Babiš abstention

Exclusive

MEP office expenses kept secret on dubious evidence

It would require between 40 to 75 additional staff to oversee how MEPs spend their monthly €4,500 lump sum on office supplies, according to the European Parliament. An EUobserver Freedom of Information request reveals those calculations are flawed.

Stakeholders' Highlights

  1. Nordic Council of MinistersNineteen demands by Nordic young people to save biodiversity
  2. Nordic Council of MinistersSustainable public procurement is an effective way to achieve global goals
  3. Nordic Council of MinistersNordic Council enters into formal relations with European Parliament
  4. Nordic Council of MinistersWomen more active in violent extremist circles than first assumed
  5. Nordic Council of MinistersDigitalisation can help us pick up the green pace
  6. Nordic Council of MinistersCOVID19 is a wake-up call in the fight against antibiotic resistance

Latest News

  1. EU urges Poland to step back from 'legal primacy' clash
  2. Pressure builds on EU to back WTO vaccine-patent waiver
  3. EU anti-fraud agency cracked down on fake pandemic supplies
  4. MEP office expenses kept secret on dubious evidence
  5. What the EU public think of EU pesticide regulation
  6. MEPs set to take EU Commission to court on rule-of-law
  7. EU takes legal action against Germany on bonds ruling
  8. MEPs demand new EU biodiversity law by next year

Join EUobserver

Support quality EU news

Join us