Steven Barrett

Britain must back the EU in its fight with German judges

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Germany’s highest court has plunged more than just the European Central Bank into crisis with its ruling on the legality of the ECB’s public sector purchase programme. The decision by the German constitutional court effectively means the Bundesbank won’t be able to participate in the ECB’s bond-buying programme, at least not unless either the law or the treaties are changed. This decision risks blowing up the EU’s entire legal setup. But the schadenfreude felt by some critics of the EU is nothing to celebrate. Instead, it’s vital that the UK sticks up for the EU in this messy dispute.

Until now the ECB has been independent of nation states and controlled by the EU (under EU law). The German position is that where the ECB acts on issues of monetary policy, the EU remains in charge. When however the issue is economic policy, Germany is; and if Germany thinks the ECB hasn’t acted in a way it thinks is right, then it won’t follow it.

If anyone truly understands the distinction between monetary and economic policy, then they have yet to speak. I suspect this will require many years of academic study. But it is a very big problem.

The entire point of the Lisbon Treaty is that it is the EU which dictates the extent of EU law – not that each of the then 28 have their own say. This is a point the UK conceded in 1972 and again in the withdrawal agreement. There will now be a stand-off between the EU and Germany, because it cannot follow that EU law is sovereign in 26 member states, and sovereign in the UK until 1 January 2021, but not sovereign in Germany. Worse, to demand EU law submits to German law, means all the 27 are subject to German law, which I suspect most will not tolerate.

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