EU Court says its ECB ruling outranks Germany’s judges
Unity of legal order in jeopardy if national courts decide cases, says Court of Justice
THE European Union’s top court has insisted it alone can rule on whether an act by an EU institution is contrary to EU law, in a rebuke aimed at judges in Germany.
The insistence by the Court of Justice of the European Union (CJEU) on its superior jurisdiction sets the court on a collision course with Germany’s Constitutional Court in Karlsruhe and raises questions that go to the heart of Europe’s only partially federalised legal and monetary structures.
On Tuesday, judges in Karlsruhe ruled that the European Central Bank (ECB) must justify its massive bond buying programme in order for Germany’s central bank – the Bundesbank – to be allowed to participate. The German judges dismissed an early verdict from the CJEU allowing the programme.
Yesterday, the European Court responded and insisted its decision stands and that it alone can decide on whether an EU institution, including the ECB, is acting within EU law.
“In general, it is recalled that the Court of Justice has consistently held that a judgment in which the Court gives a preliminary ruling is binding on the national court for the purposes of the decision to be given in the main proceedings,” the European Court said in a statement.
Allowing member states’ national courts to determine such EU cases would “be liable to place in jeopardy the unity of the EU legal order,”
Europe’s top court said.
“The Court of Justice alone – which was created for that purpose by the member states – has jurisdiction to rule that an act of an EU institution is contrary to EU law.”
While the court in Luxembourg insisted it wasn’t responding to the specific decision by Germany’s top court, the institutions are now at logger heads. That leaves the Bundesbank in a legally difficult position, pending the outcome of a legal challenge to resolve the opposing decisions.
On Thursday, the governor of the Central Bank of Ireland Gabriel
Makhlouf, who sits on the ECB Governing Council, said the German court ruling only applied to institutions there, and could not bind the ECB.
“I think it’s an interesting judgment, I think fundamentally it doesn’t actually get in the way of the ECB carrying on with its incredibly important job, especially at this time in the crisis,” Mr Makhlouf said in an interview with RTE.
“The judgment is directed at the German government and the German parliament. It looks as if it runs counter to what the European Court of Justice indicated just over a year ago but the ECB itself acts very transparently.”
In Germany the original case was taken by around 2,000 plaintiffs, including conservative lawyers and economists.
Influential former finance minister Wolfgang Schäuble, now speaker of Germany’s federal parliament, told German news service RND on Friday that the German ruling this week created a “difficult” situation, but added that there is an onus on the ECB to stick within its mandate.
“So the ruling of the [German] constitutional court is not so easy to refute,” Mr Schäuble said.