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WEISS: THE BUNDESVERFASSUNGSGERICHT’S OVER-EXPANSIVE INTERPRETATION OF THE BUNDESTAG’S ‘RESPONSIBILITY FOR INTEGRATION’ AND THE NEED TO ADAPT JUDICIAL REVIEW PROCEDURES TO THE E(S)CB’S SPECIFICITIES Diane Fromage
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Weiss: The Bundesverfassungsgericht’s over-expansive interpretation of the Bundestag’s ‘responsibility for integration’ and the need to adapt judicial review procedures to the E(S)CB’s specificities Diane Fromage 1
In its decision of 5 May 2020 in the Weiss case (3) regarding the European Central Bank (ECB)’s Public Sector Purchase Programme (PSPP), the German Federal Constitutional Court (Bundesverfassungsgericht – BVerfG) still nds that in the name of their ‘responsibility for integration’ (Integrationsverantwortung, a unique German concept the Court shaped in its Lissabon Urteil (4)) the German lower chamber, the Bundestag, and the Federal Government need to be given an opportunity to determine whether the ECB has acted beyond the scope of the competences conferred upon it, that is, whether its decision is ultra vires, as the Court of Justice of the EU has, in its view, failed to do so appropriately. The BVerfG nds that a duty rests on these German constitutional organs to take action were they to nd this to be the case, and that – remarkably – this would require that the German national central bank, the
Introduction: The Weiss judgment The process of European integration was admittedly long pursued without the sufcient involvement and indeed direct legitimisation of the national parliaments of the Member States (2). Whilst this decit certainly existed in most States at least until the adoption of the Maastricht Treaty, signicant changes have since been introduced both at the European Union (EU) and at the national level, thereby allowing for the regular scrutiny and (direct) participation of national parliaments in EU affairs. In fact, they are now called upon to ‘actively contribute to the good functioning of the Union’ (Article 12 TEU) and are, together with the European Parliament (EP) in charge of guaranteeing democratic legitimacy within the EU (Article 10 TEU).
1. Diane Fromage is an Assistant Professor of European Law at the University of Maastricht. I am indebted to the friends who, as always, were available to provide very valuable feedback on short notice. Further thanks are owed to the participants of the webinar ‘La sentencia Weiss del TCF alemán: una lectura en claves nacional y europea’ organised by the University Pompeu Fabra (Barcelona) on 19 May 2020. 2. They were long viewed as ‘losers’ or ‘latecomers’. Maurer, A. and Wessels, W. (eds), National parliaments on their way to Europe: Losers or latecomers? 2001. 3. They were long viewed as ‘losers’ or ‘latecomers’. Maurer, A. and Wessels, W. (eds), National parliaments on their way to Europe: Losers or latecomers? 2001. 4. BVerfG, Judgment of the Second Senate of 30 June 2009 - 2 BvE 2/08.
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in the past following its Lisbon and its European Stability Mechanism (5) judgments. But does it make sense to broaden the Bundestag’s prerogatives in this instance? And most importantly, is this lawful under EU law? Answering these questions eventually leads to an overall reection on the need to reform the system of judicial review in the eld of EU monetary policy.
Bundesbank, no longer participates in the PSPP, despite its having ceased to be only a national German administrative organ in view of its belonging to the European System of Central Banks (ESCB): the Bundesbank is not only bound by national law, but also by EU law and all its general principles, including primacy, uniform application and sincere cooperation. The BVerfG’s decision may thus arguably be found to belong to three of its strands of case law:
The Bundestag’s role and EU integration
Already today, the German Bundestag is one of the national parliaments whose capacities to actiThere is a need to reform vely participate in EU afthe system of judicial review fairs is best guaranteed (6). While it admittedly 2. The one concerned in the field of EU does not operate on the bawith a potential enmonetary policy sis of a mandating system croachment upon Geras some Northern Euromany’s own constitutiopean parliaments do, it renal identity and notably mains that its prerogatiits democratic safeguards ves go well beyond the minimum standards through the involvement of the Bundestag guaranteed in the EU Treaties since the entry (Maastricht saga), and into force of the Lisbon Treaty. The Responsibility for Integration Act (Integrationsve3. The one dealing with EMU-related issues rantwortungsgesetz - IntVG) and the Act on specically (Gauweiler saga). Cooperation between the Federal Government and the German Bundestag in Matters As far as the need to guarantee the involveconcerning the European Union (Gesetz ment of the Bundestag in the scrutiny of the über die Zusammenarbeit von BundesregieECB’s decision is concerned (2), the rung und deutschem Bundestag in AngeleBVerfG’s ndings may be viewed as unsurgenheiten der Europäischen Union prising and in line with its by now longEUZBBG) indeed foresee, for instance, that established case law, and they could result in a law must be approved prior to the activaa reinforcement of its right to information tion of the exibility clause (Article 352 and its scrutiny powers, as has been the case 1. The one concerned with Germany’s participation in the European integration and its own role within it (Solange saga);
5. BVerfG, Judgment of the Second Senate of 19 June 2012 - 2 BvE 4/11. 6. For a comparative overview of the situation in all EU Member States parliaments, see: C. Hefftler et al. (eds), The Palgrave Handbook of national parliaments and the European Union, 2015.
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vism or of its having taken advantage of its quality as a legislator to self-empower itself, like other national parliaments have. Rather, this outcome derives from the BVerfG’s erce defence of its role in the safeguard of representative democracy in the context of Germany’s participation in the EU since its Maastricht Urteil (10). From that perspective, the BVerfG’s reasoning in relation to the Bundestag’s and the Federal Government’s omission to take the necessary steps to ensure that the ECB’s actions remained within its mandate appears to be in line with its previous case law as noted in the introduction. The BVerfG recalls that the right to vote guaranteed to German citizens by the Basic Law (Grundgesetz) ‘protects against a manifest and structurally signicant exceeding of competences by institutions, bodies, ofces and agencies of the European Union’ (paragraph 98) and ‘is not limited to the formal legitimation of (federal) state power but also protects the basic democratic contents of the right to vote’ (paragraph 9 9 ) . A d d i t i o n a l l y, t h e BVerfG nds that ‘[t]he purpose of this fundamental right is not to subject the contents
TFEU) (7) or that an agreement be reached between the Bundestag and the German government before a nal decision is made as to whether the euro may be introduced in an additional EU Member State (8). A general right of participation is also guaranteed to the Bundestag as it is generally established that ‘[b]efore participating in projects, the Federal Government shall give the Bundestag the opportunity to deliver an opinion. To this end, the Federal Government shall continuously transmit to the Bundestag updated information on the course of discussions which will enable the Bundestag to determine, on the basis of the course of the discussions, the time by which it seems appropriate to deliver an opinion. If the Bundestag delivers an opinion, the Federal Government shall use it as a basis for its negotiations’ (9). Further to these prerogatives, the EUZBBG and the IntVG dene the Bundestag’s right to information in an extraordinary breadth and level of detail if compared to the rules in place in numerous other Member States. This relative strength of the Bundestag in EU matters is not the result of its own acti-
7. Section 8, IntVG. 8. Section 9a, EUZBBG. 9. Section 8, par. 1 and 2, EUZBBG. 10. BVerfG, Judgment of the Second Senate of 12 October 1993, 89, 155
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and the Federal President where appropriate; it also specically declares that, if need be, the Bundestag and the Federal Government have a duty to act to ‘restore the order of competences’ (paragraph 109) between Germany and the EU, be it by legitimising the increase of competences ex post, or by seeking to recover the exercise of the competence unduly assumed by EU institutions.
of democratic decision-making to substantive review but to facilitate democratic decision-making processes as such’ (paragraph 100). It follows, according to the BVerfG, that the competence to decide on its own competences (Kompetenz-Kompetenz) may not be transferred to the EU, that German constitutional organs must always be in a position to exercise their responsibility for integration when exible EU Treaty provisions are resorted to, and that when competences are being transferred to the EU ‘it must be ensured that the German Bundestag retain[s] for itself functions and powers of substantial political signicance’ (paragraph 103), its budgetary powers being specically mentioned as a prerogative that needs protecting. On this basis, the BVerfG essentially confers the responsibility to guarantee that these principles are respected to the Bundestag, the Federal Government as well as the Bundesrat
Along with this, the BVerfG also considers other issues including the division between its responsibilities and that of the Court of Justice of the European Union (CJEU) in determining whether an EU institution or body has acted ultra vires. The different aspects the BVerfG touches upon have already been brilliantly examined in depth by several – and numerous – colleagues (11), and will not be analysed in detail in this instance. It sufces to say that the BVerfG rejects the CJEU’s
11. inter alia by Nathan de Arriba-Sellier, Anna Bobić and Mark Dawson, Dimitrios Kyriazis, Hanno Kube, Miguel Poiares Maduro, Phedon Nicolaides, Daniel Sarmiento, Heiko Sauer, Armin Steinbach, Alexander Thiele, Marijn van der Sluis, Bernhard Wegener, Jacques Ziller. Verfassungsblog in particular has published numerous analyses.
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substantive analysis, and comes to the conclusion that the ECB had failed to – in the BVerfG’s opinion – sufciently demonstrate that the PSPP respected the principle of proportionality, and that the Bundestag and the Federal Government have violated the complainants’ rights since they did not challenge the ECB’s actions. Therefore, the BVerfG demands that these two constitutional organs require from the ECB that it provides them with the missing justication within three months. Should they not be satised with the ECB Governing Council’s explanations, the Bundesbank would not be allowed to continue participating in the PSPP for it, too, is barred from implementing EU acts found to be ultra vires.
Monetary policy is an area of exclusive competence in which the independent ECB alone adopts decisions for the whole of the euro area distinction among the different types of EU competences is sensible considering that in areas of exclusive competence too, the Council, and to some extent also the European Council, are called upon to act as colegislator and policy-shaper, respectively. Following Article 10 TEU, the German representative is accountable to the Bundestag when s/he participates in the Council and in the European Council. However, as further explained below, the area of monetary policy is not governed in the same way as other areas of EU competence. It is not only an area of exclusive competence, but it is also an area in which the independent ECB alone adopts decisions for the whole of the euro area; this is an essential feature the BVerfG appears to completely ignore.
What now? It could be envisaged that the Bundestag’s capacity to actively scrutinise the decisions adopted within the ESCB be enhanced, as has been done in the past where the Bundestag’s prerogatives, and with it its capacity to adequately guarantee citizens’ right to vote and be represented, had been found to be threatened. A solution in this sense could take the form of a duty of the Federal Government to regularly inform the Bundestag of the decisions taken in monetary policy matters, as it does in other EU policy areas. This obligation which, however, does not deprive the Federal Government of the ‘core of its executive responsibility’, (12) indeed applies to EU matters generally, regardless of whether they fall within an area of shared or exclusive EU competence. The absence of any
In any event, closer exchanges of oral and written information between the Bundestag, and the Bundesbank and the Federal Government (primarily), or between it and the ECB (in a subsidiary form) could be introduced to enhance the Bundestag’s capacity to scrutinize decisions made in the monetary policy domain. Proposals in this sense have, in fact, already been voiced (13). Broadening the sco-
12. Section 3, par. 4 EUZBBG. 13. In relation to the ECB by Armin Steinbach, to the Federal Government and Bundesbank by the Bundestag itself, and to the ECB and the Bundesbank by Sebastian Diessner.
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man MPs interact with representatives of the Bundesbank in the framework of hearings or by means of parliamentary questions. Perhaps it is in an attempt to remedy these shortcomings and to become better informed that the Bundestag has actually been one of the few national parliaments interacting directly with the ECB since this possibility was made available to national parliaments in recent years: national parliaments sometimes seek a direct relationship with the EU institutions or to their counterparts where they see themselves as being too weak within their national institutional order. This channel of information, if limited to cases of particular importance and organised in a way that remains (practically) sustainable for the ECB, actually bears some potential. It could facilitate the parliamentarians’ understanding of the policies pursued by the ECB whilst hopefully also contributing to debunk the prejudices some of them have against the EU institution. A direct dialogue with the ECB may additionally be anticipated as being politically attractive to parliamentarians.
pe of the information provided by the Federal Government to monetary policy matters should prove relatively straightforward, as the duty imposed on it to regularly and comprehensively inform the Bundestag in EUrelated matters is already much developed, as stated previously, and as an amendment to the EUZBBG would sufce. Such closer ties between the Federal Government and the Bundestag would, for instance, allow the former to inform the latter about the information it may gain through its participation in the Council, to which the ECB’s Annual report is submitted and where it is presented and debated with the President of the ECB (14). By contrast, so far, the relationship between the Bundestag and the Bundesbank has actually been rather loose if compared for instance to the relationship between the ECB and the EP (15), owing inter alia to the Bundesbank’s genuine independence being deeply anchored in the German (political) culture. It is thus only occasionally that Ger14. Art. 284 TFEU.
15. For an analysis of the Bundesbank’s relationship to the Bundestag, see: A.-L. Högenauer and D. Howarth, ‘The parliamentary scrutiny of euro area national central banks’, Public Administration, 2018, Vol. 97, issue 3, pp. 576-589. On the relationship between the EP and the ECB, see for instance: D. Fromage and R. Ibrido, ‘The ‘Banking Dialogue’ as a model to improve parliamentary involvement in the Monetary Dialogue?’, 2018, Journal of European Integration, Vol. 40, issue 3, pp. 295-308.
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and MPs’ criticism and indeed their scepticism towards the ECB could be fuelled by a closer interaction to the Bundesbank (18). The same dynamic may also develop through the expansion of the Federal Government’s duty to inform the Bundestag in this domain. However, establishing closer relationships with the Federal Government is less delicate, and perhaps less risky for the good functioning and the independence of the ESCB, considering that the Bundestag and the Government are political organs, and not independent ones, and, most importantly, considering that the government is tied to the Bundestag by a relationship of condence. Developing closer ties to both the Federal Government and the Bundesbank could hence be viewed as benecial, and complementary since the Bundesbank presumably has more profound technical knowledge than the Federal Government does. Admittedly, enhancing the Bundestag’s level of interaction to the Bundesbank, the Federal Government or the ECB would necessarily lead to some form of (political) judgment being passed on the ECB’s actions as, for instance, parliamentary questions can never be neutral. This would nevertheless not immediately amount to a threat to the E(S)CB’s independence, since central bank independence does not induce a right to arbitrariness, and since it needs to be compensated by a commensurate level of (democratic) accountability in any case.
This notwithstanding, increasing the degree of interaction between the Bundestag and the Bundesbank may be viewed as an even more suitable manner to full the requirement set by the BVerfG following which the Bundestag should have sufcient information to exercise its ‘responsibility for integration’ fully, be this only because of the common German language, and because exchanges with the Bundesbank would be easier to set up on a regular basis than exchanges with the ECB. In fact, German MPs seem to favour this solution over a closer relationship to the ECB (16). This could, however, lead to increasing distrust towards the ECB were the Bundesbank to openly criticise the ECB’s policies (as the governor of the Bundesbank has already done in the past (17)). This is now all the more problematic as the BVerfG has shown in this judgment that it stands ready to review the content of the ECB’s decisions itself, if it considers that the Court of Justice fails to do so appropriately. It may also prove difcult to ensure that a debate held in the Bundestag with a representative of the Bundesbank effectively takes place from a truly European perspective. In other words, the debate could be ‘renationalised’ and sight could be lost of the fact that the EU’s monetary policy is governed by the fully independent and supranational ECB, in whose Governing Council national governors participate in their personal capacity. The Bundestag has already been found to be more critical towards the ECB than it is towards the Bundesbank (despite the Bundesbank belonging to the ESCB),
16. A. Rinke and P. Carrel, ‘German lawmakers turn sights on Bundesbank to get to ECB’, Reuters, 7 May 2020. 17. Associated Press, ‘Bundesbank chief Weidmann critical of new ECB stimulus’, 13 September 2019. 18. A.-L. Högenauer, ‘The Politicisation of the European Central Bank and the Bundestag’, Politics and Governance, 2019, Vol. 7, issue 3, pp. 291302.
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bank alike, may not seek to be or be inuenced by any EU or national institution so that the Bundestag may actually only be informed and receive justications for the decisions taken without being in a position to pass any sort of consequences besides – at most – political blame, or besides seeking judicial protection – at the EU level – if it considers that the breach of a rule has occurred. In other words, unlike in other areas of EU action or in the framework of inter se agreements such as the ESM, the Bundestag has
Enhanced scrutiny: yes, but… It follows that if the Bundestag were to more actively engage in the scrutiny of the Bundesbank (and of the ECB), as underlined by the BVerfG itself, this would have to be in a way that fully guarantees the Bundesbank’s (and the E(S)CB’s) independence. On this particular point, the BVerfG’s ndings must be criticised. In this part of its reasoning, the BVerfG indeed appears to apply the standards of parliamentary scrutiny and partici-
no capacity to inuence the German representative in the ESCB, that is, the Bundesbank governor. This is so because of his genuine independence, but also because he participates in the ECB’s Governing Council in his personal capacity (19).
pation it commonly applies in other EU domains, namely that it resorts to the same denition of the ‘responsibility for integration’, without considering that the ESCB is characterised both by strict independence coupled with a unique decision-making procedure which does not involve any participation of Member States representatives, and by a peculiar institutional architecture. With respect to the former, the ECB alone can make decisions, and the ECB, and the Bundes-
Beyond this, and most importantly: the BVerfG, in extending the responsibility for integration of the Bundestag (and the Federal Government) to the review of the legality
19. Further on this: Y. Mersch, ‘Aligning accountability with sovereignty in the European Union: the ECB’s experience’, Speech delivered at the ECB legal conference on 4 September 2017.
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the belonging of the PSPP to the monetary policy domain are too narrow to make use of this expansive interpretation in the future again, or whether the ECB – which is an EU institution – should provide these justications to the two German constitutional organs are other questions. On the other hand, however, the next step the BVerfG takes in calling for the substantive control of the ECB’s actions by national organs is fundamentally unfounded. Germany’s liability could and should, in principle, be engaged for failing to respect the authority conferred on the Court of Justice: the Court itself seems to hint at such an action being taken (21), while the European Commission appears to be open to such a possibility as well (22). The BVerfG is threatening the uniform application of EU law, its primacy and it is encroaching upon the Member States’ duty of sincere cooperation. Furthermore, another infringement procedure could be necessary on another ground: if the Bundesbank unilaterally ceased to participate in the PSPP as demanded by the BVerfG, that should be examined in light of the division of competences between the ECB and national central banks under the ESCB Statute.
If the Bundesbank unilaterally ceased to participate in the PSPP as demanded by the BVerfG, that should be examined in light of the division of competences between the ECB and national central banks under the ESCB Statute of ECB decisions, appears to ignore basic principles of EU law. As monetary policy belongs to the domain of EU competence democratically conferred on the EU by the Member States according to their treaty-making powers, and contrary to the BVerfG’s nding, only the Court of Justice may rule on these matters. And under the current Treaty framework, regardless of the fact that it might be assessed as too weak de jure or de facto (20), only the EP may ensure democratic accountability strictly speaking (with due observance of the limitations induced by the ECB’s independence). In this regard, the BVerfG’s reasoning can, in fact, be viewed as both favourable and detrimental to European integration: on the one hand, it legitimises in some way the expansionary interpretation of the Treaties following which the PSPP belongs to the ECB’s monetary policy since it ‘only’ requires additional justication from the Governing Council, and therefore does not rule out its legality altogether. Whether the criteria it denes in assessing
A de-escalation strategy might be more appropriate on his occasion than direct confrontation in the form of an infringement procedure
20. Recent analyses of this question include: B. Braun, ‘Two sides of the same coin? Independence and accountability of the European Central Bank’, Transparency International EU, 2017; and S. Diessner and S. Jourdan, ‘From dialogue to scrutiny: Strengthening the parliamentary oversight of the European Central Bank’, Positive Money Europe, 2019. 21. Court of Justice of the European Union, ‘Press release following the judgment of the German Constitutional Court of 5 May 2020’, 8 May 2020. 22. Statement by President von der Leyen, 10 May 2020.
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in charge of the conduct of the EU’s monetary policy, an EU exclusive competence. Hence, it may only be held accountable at the EU level as stated before;
In view of the strongly antagonistic reactions the BVerfG’s decision has already provoked within the rst two weeks following its publication, it appears nonetheless that a de-escalation strategy might be more appropriate on his occasion than direct confrontation in the form of an infringement procedure (even if the BVerfG’s fundamentally misguided and unlawful behaviour remains). The very core of the EU must be protected at any rate, while also guaranteeing that the ECB is not put in a position to do ‘whatever it takes…except…’ from now on. Also, even if the relationship between Karlsruhe and Luxembourg is eventually pacied without resorting to an infringement procedure in this occasion, the extreme situation of tension and the potential adverse effects for the whole of the EU legal order this decision has led to, should, and will hopefully, invite national constitutional courts to more self-restraint and deference vis-à-vis the CJEU in the future.
2. The Bundesbank is both an (independent) German administrative body, and an independent national central bank part of the ESCB headed by the ECB. Thus, while it was involved in the adoption of the ECB’s decision to launch the PSPP as a member of the ECB’s Governing Council, it is also, like the ECB, shielded by its strict independence; 3. Against this background, it has been argued that it should be for the Federal Government to provide the requested justication (23). There is certainly some merit to this proposal which indeed would duly respect the E(S)CB’s independence. Yet, it appears difcult to realise in practice, not least because the Bundestag and the Federal Government were expressly tasked with assessing the respect of proportionality on the basis of a more detailed justication to be provided by the ECB. The Federal Government was thus one of the specic addressees of the decision, and it would be hard to see how it can both provide the additional information needed, and pass judgement upon it.
The bigger issue: the need for a specic procedure of judicial control in the area of monetary policy The question as to which actor - the ECB, the Bundesbank and/or the Federal Government should now provide the additional justication requested by the BVerfG to the Bundestag and the Federal Government has been subject to intense discussions since the BVerfG published its decision on 5 May. The trilemma we are now confronted with can be summarised as follows: 1. The ECB is an independent EU institution
The conundrum we are currently facing arguably points to a deeper underlying problem in relation to judicial review in the eld of EU monetary policy. Firstly, these decisions are characterised by a high level of technicity, a feature which, as many (including the CJEU) have pointed out (24), demands ju-
23. M. Lamandini and D. Ramos Muñoz, ‘Monetary policy judicial review by ‘hysteron proteron’? In praise of a judicial methodology grounded on facts and on a sober and neutral appraisal of (ex ante) macro-economic assessments’, EU Law live, 20 May 2020. 24. Judgment of 11 December 2018, Weiss and others (C-493/17).
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tary policy is not only an area of exclusive EU competence, it is one that is fully governed by an independent supranational system, the ESCB, headed by an independent EU institution, the ECB, with no participation of any organ of representation of the single national interests whatsoever. These characteristics, in and of themselves, combined with the prominent role the ECB has been called to play over the past decade, and with the recurrent judicial challenges its actions have been subjected to, arguably put the adequacy of the system of judicial review as it exists in the EU to date into question.
dicial deference and a certain degree of discretion for the ECB in the denition of its actions. This does not imply, however, that no judicial (or democratic and administrative) control should be exercised, or that the level of detail of the ECB’s justication could not be improved (25). But it does raise the overall question of the suitability of the form, organisation and articulation of the means of judicial review currently available within the EU. Some, including most recently Daniel Sarmiento (26), have argued in favour of the creation of a new specialised court (27) in the form of a ‘constitutional chamber’ which would ‘rule[…] upon the request of a supreme or constitutional court when it considers that the EU has manifestly exceeded its powers. Such a chamber could be composed of judges of the Court of Justice and national constitutional and supreme court judges’ and to ‘make things even more balanced, the composition could include the President of the European Court of Human Rights’. However, in my view, while this is a valuable proposal which would provide an efcient way to solve the question of whether the CJEU or national constitutional courts should decide the EU has acted ultra vires, this may only be a partial solution to the problem evidenced by the Weiss case. As is well-known and as has been recalled in this article on several occasions already, mone-
Like many other procedures within the EU, this system indeed relies on the cooperation, and a division of tasks, between national and European judges, whereby individual EU citizens – like the plaintiffs in the Weiss case – may only in limited and exceptional circumstances bring a case before the European Court directly. Individuals often have to bring their cases before a national judge who may, or may not, make a preliminary ruling request where necessary. Individuals should be able to litigate matters of monetary policy before the CJEU through reform of the Article 263 admissibility conditions . As evidenced by the failed attempt by individuals to bring a case against the ECB’s OMT Programme before the General Court –
25. Klaus Tuori has noted, for instance, that ‘compared to the Bank of England or the US Federal Reserve, the Eurosystem analysis on the transmission of the asset purchases to ination was moderate, more a statement than an economic argument’. K. Tuori, ‘The Eurosystem and the European economic constitution - A constitutional analysis of common central banking before and during the crisis’ (unpublished dissertation), 2017, p. 373 26. D. Sarmiento, ‘An Infringement Action against Germany after its Constitutional Court’s ruling in Weiss? The Long Term and the Short Term’, EU Law live, 12 May 2020. 27. A possibility provided for by Art. 257 TFEU.
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which declared it to be inadmissible –, a reform in this sense is indeed needed (28). The claimants, von Storch and others, argued that they were directly and individually concerned and that, therefore, they could avail themselves of the possibility open to non-privileged applicants to challenge an act of the ECB before the General Court. The General Court, however, found that the applicants were not directly concerned. As is well-known, for the requirement of direct concern to be fullled, ‘two cumulative criteria must be met, namely, rst, the contested [EU] measure must directly affect the legal situation of the individual and, second, it must leave no discretion to its addressees, who are entrusted with the task of implementing it, such implementation being purely automatic and resulting from Community rules without the application of other intermediate rules’ (29). The General Court found that the claimants’ legal position was not altered by the ECB’s announcement, which was a mere possibility for the future, the realisation of which would, additionally, still require the adoption of the ‘corresponding legal acts’. Secondly, the General Court – and this appears to be one of the key elements in its reasoning – notes that the second criterion is not fullled considering that the ECB’s decision is addressed to national central banks, which need to adopt (legal and non-legal) acts to implement it. These national acts could, in turn, be challenged by individuals before a national court, and an action for damages would still be possible so that the General Court concludes, in line with its well-established case-law, that the system of judicial remedies offers an adequate level of protection to individuals. Whereas the hypothetical character of the effects of the ECB’s decision on the plaintiffs is undisputable in this case, the actual discretion left to a national central bank in dening the content of the implementation measures would conversely need to be examined in a case in which indeed the ECB decision was implemented. National central banks ‘shall act in accordance with the guidelines and instructions of the ECB’, (30) so that they have no choice but 28. Order of 14 November 2016, von Storch and Others v ECB (T-492/12). 29. Judgment of 10 September 2009, Ente per le Ville vesuviane v Commission, (C-455/07 P) 30. Art. 14(3) ESCB Statute.
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Individuals should be able to litigate matters of monetary policy before the CJEU through reform of the Article 263 admissibility conditions
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to implement them at the national level. Furthermore, not on all occasions do national central banks alter the content of the ECB guidelines in the national implementing measures. These elements could thus potentially invite a generous interpretation of the absence of implementation measures required for applicants to have standing under Article 263(4) TFEU (Lisbon test). This would nonetheless not provide an all-encompassing solution to the weaknesses evidenced by the Weiss case. A more radical solution in the form of a newly introduced status of ‘semi-privileged’ applicants for individuals in the eld of monetary policy would therefore represent a preferable solution since it would guarantee access to the Court, and hence that it is primarily the CJEU that rules on cases in this specic area of EU exclusive competence. This would nally, and hopefully on a denite basis, remove the threat to the CJEU’s authority in this eld – a threat which has unduly existed for some time –, while also guaranteeing the respect of principles such as primacy and the uniform application of EU law.
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The ‘constitutional chamber’ would also be competent for the review of potentially ultra vires acts brought to it following the ordinary procedures of judicial review.
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This new procedure would admittedly not prevent national constitutional courts from continuing to examine these cases in parallel, for no such limitation of the prerogatives of the national constitutional courts may be imposed on the Member States by means of EU law. However, if it were coupled with the creation of a ‘constitutional chamber’ composed of both EU and national court judges, and considering that the possibility to address preliminary references to this chamber would of course remain, it may be expected that the incentive for a constitutional court to rule alone on matters affecting the EU’s monetary policy would, at least, signicantly decrease. Direct individual access to the ‘constitutional chamber ’ could thus be established in the area of monetary policy, while the ‘constitutional chamber’ would also be competent for the review of potentially ultra vires acts brought to it following the ordinary procedures of judicial review. To avoid any misunderstanding: in that framework as well, the CJEU should naturally continue to show deference towards the ECB in view of its independence and of the discretion it must enjoy.
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sion of powers between the EU and its Member States that the Maastricht Treaty already enacted through the creation of the E(S)CB.
Conclusion The reinforcement of the role of the Bundestag that the decision of the BVerfG calls for would not necessarily be a negative development if it took the form of increased information and closer scrutiny of the decisions in monetary policy. This could arguably set the Bundestag in a better position to make informed decisions in other areas in which it does have competence, such as Germany’s economic and scal policy, or the introduction of the euro in another Member State. Also, it is beyond doubt that nowadays even the decisions taken by the ECB in the monetary policy domain, which includes the PSPP, have important consequences on the economic policies of the Member States, so that such a development should probably even be welcomed. Beyond this, in so doing, the Bundestag would (or could at least) full the communication and pedagogical functions it must pursue for German citizens as a parliamentary organ of democratic representation. Yet, anything going beyond better information and scrutiny standards, and especially the attribution of a right to control the legality of the ECB’s decisions in the name of the Bundestag’s ‘responsibility for integration’, is contrary to EU law, as such a judgment can only be for the Court of Justice to pass.
The Weiss judgment highlights the specificities of the area of monetary policy which arguably demand the creation of a new, specific, procedure of judicial review at the EU level The recent proposal by President Macron and Chancellor Merkel to create a European Recovery Fund (31) appears to indicate that, at this stage, no step forward is impossible. They even seem ready to take the bumpy road towards a new reform of the Treaties. This, together with the upcoming Conference on the Future of Europe and the German presidency of the Council in the second half of this year, should be used as an opportunity to provide long-lasting solutions to the issues evidenced by Weiss: both in terms of the procedure of judicial review in the area of monetary policy and of ultra vires control, and in terms of the underlying imbalances between monetary and economic policies, which required from the ECB that it play such a prominent role in the rst place.
The Weiss judgment highlights the specicities of the area of monetary policy which arguably demand the creation of a new, specic, procedure of judicial review at the EU level. Granting direct access for individuals to the CJEU would, in fact, only bring the system of judicial review in line with the full transfer of competences and the new divi31. Franco-German initiative, ‘Emerging stronger from the crisis’.
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News Highlights Week 18-22 May 2020 Council of the EU reaches political agreement on SURE
ECtHR Report on impact of the ECHR in Greece
Monday 18 May
Monday 18 May
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As part of the EU’s emergency support package to tackle the economic impact of the COVID-19 crisis, a new instrument for temporary ‘Support to mitigate Unemployment Risks in an Emergency’ was approved by the Council of the EU. This is one of the three safety nets for jobs and workers, businesses and Member States, contained in the Eurogroup report agreed on 9 April 2020.
General extensions of time limits come to an end but parties can submit reasoned requests: EUIPO Monday 18 May
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The EUIPO announced the end of the time limit extensions of proceedings it had applied in response to the COVID-19 crisis. Parties affected by ‘exceptional circumstances’ as a result of the COVID-19 crisis can still however request a further extension of no more than six months.
Effective legal protection of discrimination victims and procedural autonomy of Member States: the AG’s Opinion in Braathens Regional Aviation AB Tuesday 19 May By Dolores Utrilla
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Advocate General Saugmandsgaard Øe delivered his Opinion in Braathens Regional Aviation AB (C-30/19), nding that the right of non-discrimination goes beyond compensation sought by the victim and requires national courts to examine and, if it proceeds, to acknowledge the alleged breach of rights.
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As part of the European Court of Human Rights series of reports providing a global overview of its work and the impact of its judgments in Member States, The ECHR and Greece in Facts and Figures report was published. Despite the improvements and reforms implemented, a high percentage of violations of the European Convention on Human Rights is revealed in the report.
The EU’s Common Approach to contact tracing: the EDPB, EDPS, Commission and Parliament’s responses Tuesday 19 May By Anjum Shabbir
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Currently there is a widely divergent and fragmented approach to contact tracing apps amongst Member States, which has led the EU to call for a common approach and align the Member States. Guidance, guidelines and monitoring from the European Data Protection Board, European Data Protection Supervisor, Commission and Parliament make up that common approach, designed to enable compliance with EU data protection law.
ECtHR refers Norwegian case on adoption to Grand Chamber Tuesday 19 May
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The Grand Chamber panel of the European Court of Human Rights decided to accept the referral made to it of Abdi Ibrahim v. Norway. The case concerns the decision of Norwegian authorities to allow the adoption of a child by a foster family against his mother’s wishes.
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A way out of the crisis? The FrancoGerman proposal for a 500 billioneuro European Recovery Fund Tuesday 19 May By Dolores Utrilla
Tuesday 19 May
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A Franco-German proposal for a European Recovery Fund has been put forward. This fund is intended to be distributed in the form of grants among the EU Member States that have most severely been affected by the COVID-19 outbreak, with repayments made from the EU’s overall budget. This proposal shows a signicant compromise between the German position and the French one.
Fundamental Rights Agency identifies problems in legislative protection of LGBTI people in Europe Wednesday 20 May By Anjum Shabbir READ MORE ON EU LAW LIVE
The Fundamental Rights Agency published a report detailing the results of the largest survey on how protected LGBTI people feel in terms of their fundamental rights. This assessment highlights where there is weak implementation of EU law and points out where new or more protective measures are needed through EU legislation or case law.
AG Pitruzzella’s Opinion on the scope of rules governing social assistance to migrant work seekers with children attending school in the host Member State Wednesday 20 May
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The former judge of the European Court of Human Rights in respect of Iceland, Robert Spano, took up ofce as President of the ECtHR. His rst public talk since taking over the position will be on ‘The Principle of Judicial Independence and the Democratic Virtues of Human Rights Law’.
SURE instrument formally adopted and officially published Wednesday 20 May 2020
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A new instrument for temporary ‘Support to mitigate Unemployment Risks in an Emergency’ was ofcially published and entered into force. Support under this instrument will become available after all the Member States have provided their guarantees and will be operational until 31 December 2022.
Coronavirus: Commission welcomes ECDC guidance on surveillance of COVID-19 in long-term care facilities in the EU Wednesday 20 May
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The European Centre for Disease Prevention and Control (ECDC) published guidance to Member States for the development of COVID-19 surveillance in longterm care facilities, taking the view that testing and reporting plays a crucial role for adequate protection.
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Advocate General Pitruzzella delivered his Opinion in Jobcenter Krefeld (C-181/19). By this Opinion, he considers that, under EU Law, the state must grant access to basic social security benets to a former migrant worker as well as their children who attend school in the host Member State and have a right of residence.
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Robert Spano takes up office as ECtHR President and will take part in online webinar on 29 May
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New pending case before the ECtHR concerning reform of the Polish judiciary
Council decision: three billion euros in assistance to 10 neighbouring countries
Wednesday 20 May
Wednesday 20 May
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The European Court of Human Rights (ECtHR) requested Poland to submit its observations in Żurek v. Poland, concerning the premature termination of a judge’s mandate as a member of the constitutional organ in Poland, as well as his dismissal as spokesperson and the alleged campaign to silence him.
As a matter of urgency, the Council of the European Union adopted a decision to provide up to 3 billion euros of macro-nancial assistance to support 10 neighbouring countries experiencing economic fallout as a result of the COVID-19 pandemic.
Transport and COVID-19: Council adopts temporary flexibility for licences and port services Thursday 21 May
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The Council amended two Regulations in order to mitigate the effects of COVID-19 in the context of the supply chain and transportation, the ‘heavy burden’ on transport operators, seeking to ease their administrative burden. The European Parliament already voted on these measures and Regulations are expected to enter into force next week.
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The EFTA Surveillance Authority approved a Norwegian subsidised loan scheme of 2 billion NOK to provide access to liquidity for enterprises offering domestic and international package travels, which are struggling nancially as a result of the COVID-19 pandemic and the related decline in demand and widespread cancellations of package travels.
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Joint Statement: EU-UK Specialised Committee on Citizens’ Rights Thursday 21 May
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A Joint Statement followed a meeting of the EU-UK Specialised Committee on Citizen’s Rights, brief in nature, and concerning compliance with mutual legal obligations under the Withdrawal Agreement that protect citizen’s rights - in the context of continued political tension. Further such meetings will be held to follow the progress of the implementation.
When European Semester met coronavirus: a refocused Spring Package
EFTA Surveillance Authority approves Norwegian aid scheme for package travel traders Thursday 21 May
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Thursday 21 May by Dolores Utrilla
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The Commission presented the European Semester Spring Package, which is called on to be one of the crucial elements of the strategy for recovery from the crisis caused by the COVID-19 outbreak. Not surprisingly, the instrument has been reoriented to address the need to mitigate the socio-economic impact of the coronavirus crisis and to facilitate economic recovery, while keeping in sight the longer-term priorities (which include green transition and digital transformation).
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EASA and ECDC publish joint guidelines to assure health safety in air travel Friday 22 May
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Ahead of the lifting of travel restrictions in many Member States, and as the tourism summer season approaches, the European Union Aviation Safety Agency (EASA) and the European Centre for Disease Prevention and Control (ECDC) issued a joint document containing guidelines on measures to protect the health safety of air travellers and aviation personnel at every stage of the end-to-end journey.
Analyses & Op-Eds Monetary policy judicial review by ‘hysteron proteron’? In praise of a judicial methodology grounded on facts and on a sober and neutral appraisal of (ex ante) macro-economic assessments By Marco Lamandini and David Ramos Muñoz
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By Phedon Nicolaides
Op-Ed examining the legal reasoning of the German Federal Constitutional Court in its judgment of 5 May 2020 concerning the Public Sector Purchase Programme of the European Central Bank. The authors argue that, in addition to its foreseeable negative political consequences for the EU, the judgment is vitiated by some technical aws.
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The Judgment of the Federal Constitutional Court of Germany on the Public Sector Asset Purchase Programme of the European Central Bank: Setting an Impossible and Contradictory Test of Proportionality Op-Ed which examines and analyses the part of the German Federal Constitutional Court’s (BVerfG) judgment of 5 May 2020 concerning the substance of the Public Sector Purchase Programme (PSPP), namely the nding that the PSPP was not in conformity with the principle of proportionality, comparing it to the EU’s corresponding notion and assessing its internal logic, arguing that the BVerfG’s analysis on the substance of the case is wrong because it invents a new and impossible test of proportionality which is self-contradictory.
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Between Karlsruhe and Luxembourg, lies Frankfurt? The Bundesbank and the Bundesverfassungsgericht’s PSPP decision By Nathan de Arriba-Sellier
Op-Ed in which the conict of laws in monetary policy is explored, with the suggestion that, in case of a noncooperative solution, the Bundesbank abides by the jurisdiction of the Court of Justice. Irrespective of the ECB’s response, the Bundesbank is bound to respect EU law, is subordinate to the ECB and falls under the jurisdiction of the Court of Justice. Reinterpreting the Treaties in light of the Kompetenz-kompetenz principle and the democracy principle is a bold, but ignoring clear, precise, and unconditional provisions, to which its ‘Masters’ consented, would amount to a breach of the very constitution the Bundesverfassungsgericht ought to defend.
Partial Refund of ‘Uncontested’ VAT in the Agrobet case By Darya Budova
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Making Europe healthier: Biodiversity and Sustainable Food strategies unveiled by the Commission By Anjum Shabbir
Analysis of the Court of Justice’s judgment in case C446/18, Agrobet. In this ruling the Court has ruled on whether it is possible for the tax authorities to make a partial refund of excess VAT requested by a taxable person, when only one part of such VAT is under review in a tax inspection procedure and there is ‘uncontested’ VAT. The Court has established that this is possible and, more interestingly, has provided a specic procedural road map for the national tax authorities when facing this kind of refund.
Analysis of the context of two ambitious strategies, core parts of the European Green Deal, published by the European Commission on biodiversity and food sustainability for which it seeks the European Parliament and Council of the EU’s endorsement ahead of the Convention on Biological Diversity in 2021. A number of new measures, including a legal framework to meet binding targets to restore damaged ecosystems, and the reduction of pesticides and antimicrobials by 50%, are proposed.
Library - Book Review
By Christopher Mondschein
EDITED BY CHRISTOPHER KUNER, LEE A. BYGRAVE, CHRISTOPHER DOCKESY, AND WITH ASSISTANT EDITOR LAURA DRECHSLER
The EU General Data Protection Regulation (GDPR): A Commentary
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Christopher Mondschein offers this book review just as the GDPR celebrates its second anniversary, of an ‘authoritative source of information and an ideal starting point for researching answers to questions surrounding the GDPR’. This review of the GDPR, article by article is described as of a quality and depth that ‘is coherent between different articles and even more “exotic” provisions of the GDPR never feel like they were treated with neglect’.
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