Thursday

28th Mar 2024

Commission struggles with German court challenge

  • In dismissing an EU court decision, Germany's highest court has challenged the primacy of EU law (Photo: curia.europa.eu)

The EU Commission president Ursula von der Leyen has warned Germany of a possible legal probe over last week's landmark decision on bond-buying by the country's Constitutional Court, based in Karlsruhe - but such a move is highly dicey.

In its ruling, the court instructed the German government to ensure that the European Central Bank (ECB) carried out a "proportionality assessment" of its bond-buying programme within three months.

Read and decide

Join EUobserver today

Get the EU news that really matters

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

... or subscribe as a group

Germany's most senior court dismissed a 2018 ruling by the European Court of Justice that had already approved ECB purchases, saying the court moved beyond its competences when it signed off the bank's moves.

The unprecedented decision raised fundamental questions about the independence of the ECB and the supremacy of EU law in the bloc.

On Sunday (10 May), von der Leyen stressed that the EU monetary policy is a matter of exclusive competence, that EU law has primacy over national law and that rulings of the ECJ are binding on all national courts.

Von der Leyen said the commission is looking into possible next steps, including the option of infringement proceedings, the name for EU probes in case a member states breaks the common rules.

The pressure is on the commission to act. But there are limitations what an infringement procedure can do legally, making the decision increasingly a political one.

Under infringement procedures, the commission, through a dialogue, calls on the member states to remedy a breach of EU law and if it fails, then the EU executive takes the member state to the ECJ. This can take years.

But an infringement procedure itself would not overturn the German Constitutional Court's decision, however, and could also run the risk of raising questions over the commission's respect for judicial independence.

It would also put the German government, which does not have control over the court or over its central bank, in a tough spot.

While the procedure is launched against the "conduct of a member state", as one EU official put it, it would have to be the German government who then defends the Karlsruhe decision at the ECJ.

Nevertheless, being tough on Germany could boost the perception of independence of the German commission chief, a long-time ally of chancellor Angela Merkel.

But while there are risks to such legal action by the commission, doing nothing is also a gamble.

"This case goes to the very heart, the very basis of the EU," said one EU official on the German court decision.

"The EU is based on law, on the voluntary agreement by member states," the official said.

The official added that for the EU to function and for EU law to be applied everywhere the same way, there needs to be a common interpretation of the common rules, which only the ECJ can provide.

"The ECJ is the last judge, and it is obligatory for all judges in Europe," the official said, adding that the EU law has primacy over national law, since a case in 1964.

Not 'united states'

Some in Europe, meanwhile, do not agree that the EU's top court should have the the final say, and that EU institutions have gone too far.

Poland's prime minister Mateusz Morawiecki told the German newspaper Frankfurter Allgemeine Zeitung that the Karlsruhe ruling was "one of the most important" in the EU's history and that "the ECJ does not have unlimited powers".

Hungary's justice minister Judit Varga told Magyar Nemzet newspaper that the Budapest government's position has been that countries and their constitutional courts have the final say, if EU and member states competencies clash.

"The decision of the German Constitutional Court confirmed the view that the European Union is not equal to the European United States in this respect".

However, Hungary and Poland has been locked in various legal and political battles with the EU for years over breaking EU rules.

"The union is based on the uniform interpretation and application of union law, otherwise we have no union," the EU official said bluntly.

Merkel: "Solvable'

Meanwhile German chancellor Angela Merkel attempted to diffuse tensions between her country's highest court and the commission by telling her party members on Monday (11 May) that the issue was "solvable".

She said a clash could be avoided if the ECB demonstrates the necessity of its bond-buying scheme.

Detlef Seif, deputy EU spokesman for Merkel's conservative parliamentary bloc in the Bundestag was quoted by Reuters as arguing that the Karlsruhe court had not questioned the primacy of the EU's top court in its ruling.

German court questions bond-buying and EU legal regime

The German Constitutional court ordered the European Central Bank to explain its 2015 bond-buying scheme that helped eurozone stay afloat - otherwise the German Bundesbank will not be allowed to take part.

Hungary and Poland in spotlight for lockdown moves

The EU commission is double-checking emergency measures in every member state, as fundamental rights have been temporarily abrogated. But Hungary and Poland are problematic, yet no actions are planned.

Von der Leyen criticises Hungary, but fails to mention it

The EU Commission called on member states not to trample on democratic rules in the fightback against coronavirus - without mentioning Hungary by name. It will monitor all EU countries and discuss emergency measures on Wednesday.

EU takes legal action against Germany on bonds ruling

The European Commission on Wednesday (9 June) launched legal action against Berlin, after determining that last year's landmark decision on bond-buying by Germany's Constitutional Court "constitutes a serious precedent" that puts at risk the EU's legal order.

Column

That German court ruling hurts EU rule-of-law fightback

The short-term damage to financial markets may be smaller than feared. The damage to democracy is considerable because it weakened the ECJ - the most effective institution to stop attacks against democracy and rule of law in EU member states.

Opinion

Why UK-EU defence and security deal may be difficult

Rather than assuming a pro-European Labour government in London will automatically open doors in Brussels, the Labour party needs to consider what it may be able to offer to incentivise EU leaders to factor the UK into their defence thinking.

Latest News

  1. 'Swiftly dial back' interest rates, ECB told
  2. Moscow's terror attack, security and Gaza
  3. Why UK-EU defence and security deal may be difficult
  4. EU unveils plan to create a European cross-border degree
  5. How migrants risk becoming drug addicts along Balkan route
  6. 2024: A Space Odyssey — why the galaxy needs regulating
  7. Syrian mayor in Germany speaks out against AfD
  8. Asian workers pay price for EU ship recycling

Stakeholders' Highlights

  1. Nordic Council of MinistersJoin the Nordic Food Systems Takeover at COP28
  2. Nordic Council of MinistersHow women and men are affected differently by climate policy
  3. Nordic Council of MinistersArtist Jessie Kleemann at Nordic pavilion during UN climate summit COP28
  4. Nordic Council of MinistersCOP28: Gathering Nordic and global experts to put food and health on the agenda
  5. Friedrich Naumann FoundationPoems of Liberty – Call for Submission “Human Rights in Inhume War”: 250€ honorary fee for selected poems
  6. World BankWorld Bank report: How to create a future where the rewards of technology benefit all levels of society?

Stakeholders' Highlights

  1. Georgia Ministry of Foreign AffairsThis autumn Europalia arts festival is all about GEORGIA!
  2. UNOPSFostering health system resilience in fragile and conflict-affected countries
  3. European Citizen's InitiativeThe European Commission launches the ‘ImagineEU’ competition for secondary school students in the EU.
  4. Nordic Council of MinistersThe Nordic Region is stepping up its efforts to reduce food waste
  5. UNOPSUNOPS begins works under EU-funded project to repair schools in Ukraine
  6. Georgia Ministry of Foreign AffairsGeorgia effectively prevents sanctions evasion against Russia – confirm EU, UK, USA

Join EUobserver

EU news that matters

Join us