Table of Contents
- Germany’s constitutional court has questioned the legality of a past ruling of the European Court of Justice (ECJ).
ECJ
- Supreme court of the European Union (EU) in matters of EU law.
- Part of the Court of Justice of the European Union (CJEU).
- Luxembourg-based
- Found in 1952 after the Treaty of Paris.
- In terms of hierarchy, the national courts of member countries are below the ECJ in matters of EU law.
- It ensures that EU law is interpreted and applied the same in every EU country.
- It ensures that countries and EU institutions abide by EU law.
- It settles the legal disputes between national governments and EU institutions.
- It is composed of one judge per member state – currently 27 – although it normally hears cases in panels of three, five or 15 judges.
- The President of the Court of Justice is elected from and by the judges for a renewable term of three years.
CASE
- The ECB’s mass bond-buying was launched after the eurozone’s 2010 crisis as support for the euro besides the EU’s national bailouts for Greece and some other countries.
- The scheme challenged in court is called the Public Sector Purchase Programme (PSPP), launched in March 2015, under which the ECB had bought €2.1tn of bonds by November 2019. Separately, the ECB bought bonds worth another €0.5tn.
ECJ’s 2018 verdict
- In 2018, the ECJ had ruled that a EUR 2 trillion bond-buying scheme of the ECB was legal as per EU law.
- This scheme aimed at reinvigorating the EU economy after the multi-year European debt crisis.
German Court’s verdict
- In Germany, opponents of the scheme had for years complained to the German Constitutional Court, the country’s highest.
- The German Court in turn had expressed its concerns on parts of the scheme in 2017.
- It ruled that the ECJ’s 2018 ruling was “ultra vires”, meaning beyond the latter’s legal authority.
- It said that the ECJ did not properly address whether the ECB scheme was justifiably suited for the EU economy.
- It said that the ECJ’s verdict failed to consider the importance of the proportionality principle that applies to the division of competences between the EU and the Member States.
- The German court has now given the ECB three months to prove that the bond-buying scheme was proportionate as per the EU’s actual needs.
Response of the EC
- After the German ruling, the European Commission (EC) underlined the supremacy of the ECJ.
- Notwithstanding the analysis of the detail of the German Court decision, they reaffirm the primacy of the EU law.
- It reaffirmed that the rulings of the ECJ are binding on all national courts.
Latest Burning Issues | Free PDF