The European debt crisis and European Union law

Common Market Law Review

Volumn 48, Issue 6, 2011, Pages 1777-1806

  Ruffert, Matthias ^a  

^a FRIEDRICH SCHILLER UNIVERSITY JENA   (Germany)

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EID: 84859075293     PISSN: 01650750     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (124)

1. nded. (OUP, 2011), p. 713.
2. See the judgment of 7 Sept. 2011, 2 BvR 987, 1099 and 1485/10, available at
3. press release in English: (last visited 4 Oct. 2011).
4. Cf. on the judgment, Ruffert, "Die europäische Schuldenkrise vor dem Bundesverfassungsgericht", (2011) EuR, forthcoming
5. prior to the judgment, Thym, "Euro-Rettungsschirm: Zwischenstaatliche Rechtskonstruktion und verfassungsgerichtliche Kontrolle", (2011) EuZW, 167-171
6. On this pact see Hahn, "The stability pact for European Monetary Union: Compliance with deficit limit as a constant legal duty", 35 CML Rev. (1998), 77-100.
7. Cf. Streinz, Ohler and Herrmann, Der Vertrag von Lissabon zur Reform der EU, 3rd ed. (2010), p. 86, who talk about some "fine-tuning".
8. Cf. also Stotz, "Neuerungen im Bereich der Wirtschafts- und Währungsunion", in Schwarze (Ed.), Der Verfassungsentwurf des Europäischen Konvents (Nomos, 2004), pp. 225 et seq.
9. Some of the following facts are already reported in Ruffert, "Der rechtliche Rahmen für die gegenseitige Nothilfe innerhalb des Euro-Raumes", 64 Berlin e-Working Papers on European Law (2011), available at: (last visited 4 Oct. 2011). However, since January, the development did by no means stop.
10. See also Louis, "Guest editorial: The no-bailout clause and rescue packages", 47 CML Rev. (2010), 971 et seq.
11. Cf. (last visited 4 Oct. 2011). The original Communication is no longer online (!).
12. Council Decision (2010/320/EU) of 10 May 2010 addressed to Greece with a view to reinforcing and deepening fiscal surveillance and giving notice to Greece to take measures for the deficit reduction judged necessary to remedy the situation of excessive deficit, O.J. 2010, L 145/6, amended by Council Decision (2010/486/EU) of 14 Sept. 2010, O.J. 2010, L 241/12.
13. For details see (last visited 4 Oct. 2011).
14. On further measures concerning Greece cf. infra note 25.
15. There is a historical analysis by Ludlow, "In the last resort - The European Council and the Euro crisis, spring 2010", 7 Eurocomment Briefing Note (2010)
16. It would take us too far to give an overall account of such phenomena. Press reports highlight corruption, fraud or other (quasi-)criminal issues.
17. Tax collection efficiency could serve as an example, cf. the Commission Report "Tax shortfalls in Greece" by Servera and Moschovis, Country Focus of 5 Feb. 2008, available at: (last visited 4 Oct. 2011).
18. Council Regulation (EU) No. 407/2010 of 11 May 2010 establishing a European financial stabilization mechanism, O.J. 2010, L 118/1.
19. Art. 2(2) of the Regulation refers to the ceiling for the own resources following Art. 3 of Council Decision (2007/436/EC, Euratom) of 7 June 2007 on the system of the European Communities' own resources, O.J. 2007, L 163/17.
20. Articles of Incorporation available at: (last visited 4 Oct. 2011).
21. The relevant decision of the euro area Member States meeting within the Council is laid down in Council Doc. 9614/10 of 10 May 2010.
22. The text of the Framework Agreement between the Member States of the euro area and the EFSF is available at: (last visited 4 Oct. 2011).
23. European Council of 24/25 March 2011, Conclusions, Doc. EUCO 10/11, para 17; European Council of 23/24 June 2011, Conclusions, Doc. EUCO 23/11, para 9.
24. See also the modifications by the Eurogroup, press release of 11 July 2011
25. Council of the European Union, Statement by the heads of State or Government of the euro area and EU institutions, unnumbered (!) document of 21 July 2011: (last visited 4 Oct. 2011).
26. Details available at: (last visited 4 Oct. 2011).
27. latest modification by Council Implementing Decision (2011/542/EU) of 2 Sept. 2011 amending Implementing Decision 2011/77/EU on granting Union financial assistance to Ireland, OJ 2011, L 240/11.
28. Cf. with respect to the Art. 126TFEU proceedings against Ireland: Council Recommendation with a view to bringing to an end the situation of an excessive deficit in Ireland, Council Doc. 17210/10 of 7 Dec. 2010.
29. Cf. the Memorandum of Economic and Financial Policies, available at: (last visited 4 Oct. 2011)
30. together with the Technical Memorandum of Understanding: (last visited 4 Oct. 2011).
31. Cf. (last visited 4 Oct. 2011).
32. For details see (last visited 4 Oct. 2011).
33. See the Statement by the Eurogroup and ECOFIN Ministers, MEMO/11/227 of 8 Apr. 2011, and the Statement on Portugal by Olli Rehn, European Commissioner for Economic and Monetary Affairs, and Dominique Strauss-Kahn, (then) Managing Director of the IMF, MEMO/11/275 of 5 May 2011; Council Press Release 10231/11 of 17 May 2011.
34. Details available at: (last visited at 4 Oct. 2011).
35. Memorandum of Understanding on Specific Economic Policy Conditionality of 17 May 2011, available at: (last visited 4 Oct. 2011).
36. Cf. Statement by the Eurogroup of 20 June 2011, available at: (last visited 4 Oct. 2011), followed by European Council of 23/24 June 2011, Conclusions, Doc. EUCO 23/11, para 15.
37. Decision (2010/281/EU) of the European Central Bank of 14 May 2010 establishing a securities markets programme, O.J. 2010, L 124/8. The debt accumulated is about {currency sign} 150-150 billion
38. (see the ECB's own information at: and Frankfurter Allgemeine Zeitung, No. 219, 23 Sept. 2011 p. 23).
39. See the press release by the President of the ECB of 7 Aug. 2011, available at: (last visited 4 Oct. 2011).
40. Final Report by the Task Force established by the March 2010 European Council, Doc. 15302/10 of 21 Oct. 2010, endorsed in Conclusions of the European Council of 28/29 Oct. 2010, EUCO 25/1/10 REV 1.
41. Conclusions of the European Council of 16/17 Dec. 2010, EUCO 30/1/10 REV 1, with Annexes I and II. The formal decision submitted for ratification under the procedure of Art. 48(6) TEU was made by the European Council of 24/25 March 2011: 2011/199/EU: European Council Decision of 25 March 2011 amending Article 136 of the Treaty on the Functioning of the European Union with regard to a stability mechanism for Member States whose currency is the euro, O.J. 2011, L 91/1.
42. The Draft was not published before the beginning of July 2011 ( (last visited 4 Oct. 2011)).
43. The outline ("term sheet") of the ESM is designed in the Conclusions of the European Council of 24/25 March 2011, Doc. EUCO 10/1/11 REV 1. Quotations are from the term sheet.
44. Art. 5(1) and (3) ESM Draft Treaty.
45. The rules explained in the following are laid down in Arts. 8-11 ESM Draft Treaty.
46. On ESM operations see Arts. 12-17 ESM DraftTreaty.
47. Cf. the thorough explanation by Ohler, "The European Stability Mechanism: The long road to financial stability in the euro area", 54 German Yearbook of International Law (2011), forthcoming, sub IV.
48. On such programme see section 3.3.2.
49. Lenaerts andVan Nuffel, European Union Law, 3rd ed. (2011), para 11-037
50. Schorkopf, "Gestaltung mit Recht", 136 AÖR (2011), 339
51. Hentschelmann, "Finanzhilfen im Lichte der No Bailout-Klausel - Eigenverantwortung und Solidarität in der Währungsunion", (2011) EuR, 289 et seq
52. Cf. also Kube and Reimer, "Grenzen des Europäischen Stabilisierungsmechanismus", (2010) NJW, 1913, who argue that the EFSF was an illicit circumvention of the prohibition.
53. Herrmann, "Griechische Tragödie - der währungsverfassungsrechtliche Rahmen für die Rettung, den Austritt oder den Ausschluss von überschuldeten Staaten aus der Eurozone", (2010) EuZW, 415
54. Everling, "Wirtschaftspolitik und Finanzhilfe in der Währungunion der Europäischen Union", in Müller-Graff, Schmahl and Skouris (Eds.), Europäisches Recht zwischen Bewährung undWandel, Festschrift für Dieter H. Scheuing (2011), p. 541
55. thed. (2011), para 23/5.
56. That was also the position of the German Government in the Bundestag hearing in Apr. 2010.
57. Cf. Knopp, "Griechenland-Nothilfe auf dem verfassungsrechtlichen Prüfstand", (2010) NJW, 1779 (who follows the view taken here).
58. It is true that literature before 2010 does not address the issue of deliberate support
59. thed. (Kluwer Law International, 2008), p. 881 at 908, and it could be derived from this that deliberate support was outside the prohibiting scope of Art. 125 TFEU and its predecessors.
60. However, this is not cogent, and there are authors arguing in the direction of the present article, such as Smits, The European Central Bank. Institutional Aspects, (Kluwer Law International, 1997), p. 77.
61. The counter-argument based on solidarity is analysed elsewhere in this article, see section 2.3.3.
62. Hahn and Häde, Währungsrecht (2010), para 27/19 et seq
63. Häde, "Die europäische Währungsunion in der internationalen Finanzkrise -An den Grenzen europäischer Solidarität?", (2010) EuR, 855 et seq
64. Frenz and Ehlenz, "Der Euro ist gefährdet: Hilfsmöglichkeiten bei drohendem Staatsbankrott", (2010) Europäisches Wirtschafts- und Steuerrecht, 67 et seq
65. Some authors, however, wisely predicted that the EMU contained, from its outset, a de facto obligation to rescue defaulting partners
66. Herdegen, "Price stability and budgetary restraints in the Economic and Monetary Union: The law as guardian of economic wisdom", 35 CML Rev. (1998), 22
67. Amtenbrink and De Haan, "Economic governance in the European Union: Fiscal policy discipline versus flexibility", 46 CML Rev. (2003), 1093.
68. This, of course, does not create a legal obligation or even power
69. This was the core argument of the German Federal Government in the proceedings before the Bundesverfassungsgericht, developed by its representative: Häde, "Rechtsfragen der EU-Rettungsschirme", (2011) Zeitschrift für Gesetzgebung, 6 et seq
70. Cf. Faßbender, "Der europäische 'Stabilisierungsmechanismus' im Lichte von Unionsrecht und deutschem Verfassungsrecht", (2010) Neue Zeitschrift für Verwaltungsrecht, 801.
71. This is rightly rejected by Schröder, "Die Griechenlandhilfen im Falle ihrer Unionsrechtswidrigkeit", (2011) DÖV, 63 et seq
72. See the MEMO/11/313 of 19 May 2011
73. Emphasis added
74. Protocol (No. 4) on the Statute of the European system of central banks and of the European central bank, O.J. 2010, C 83/230.
75. With regard to the ECB's competences cf. Seidel, "Editorial", (2010) EuZW, 521, and - with less rigidity - Müller-Graff, "Die europäische Wirtschafts- und Währungsunion: Rechtliche Rahmendaten für Reformen", in Bechtold, Jickeli and Rohe (Eds.), Recht, Ordnung undWettbewerb, Festschrift zum 70. Geburtstag vonWernhard Möschel (2011), p. 890.
76. Cf. Gaitanides, "Intervention des IWF in der Eurozone - mandatswidrig?", (2011) Neue Zeitschrift für Verwaltungsrecht, 848-852.
77. This could trigger off an indirect control by this Court in the future
78. "We violated all the rules because we wanted to close ranks and really rescue the euro-zone." quoted from: (last visited 4 Oct. 2011).
79. Composed of representatives of the national Parliaments, of the Heads of State or Government of the Member States, of the European Parliament and of the Commission under Art. 48(3) TEU.
80. Similarly Calliess, "Perspektiven des Euro zwischen Solidarität und Recht - Eine rechtliche Analyse der Griechenlandhilfe und des Rettungsschirms", (2011) Zeitschrift für Europarechtliche Studien, 278
81. See for the latest case in the line Opinion 1/09 of 8 March 2011 (Patents Court)
82. Cf. on this principle Nettesheim, in Grabitz, Hilf and Nettesheim (Eds.), Das Recht der Europäischen Union (2010),Art. 10 EUV, paras. 20 et seq.
83. The quotation in English is drawn from the press release. There is a following decision on the implementation in Germany which temporarily stops the operation of a particular parliamentary committee: decision of 27 Oct. 2011, 2 BvE 8/11.
84. This is the core argument of Calliess, "Perspektiven des Euro zwischen Solidarität und Recht - Eine rechtliche Analyse der Griechenlandhilfe und des Rettungsschirms", (2011) Zeitschrift für Europarechtliche Studien, 268 et seq., who also gives a most extensive analysis on the principle of solidarity and its applicability in the field of the EMU (at 233 et seq.).
85. See section 2.3.1.
86. BIS Quarterly Review, June 2011, p. 18 (available at: (last visited 4 Oct. 2011)).
87. The report was communicated in Frankfurter Allgemeine Zeitung No. 131 of 7 June 2011, p. 19.
88. Cf. only (also on the following) Snyder, "EMU revisited: Are we making a constitution? What constitution arewe making?", in Craig and De Búrca (Eds.), The Evolution of EU Law, 1st ed. (OUP, 1999), pp. 449 et seq. and 457 et seq.
89. From an economist's point of view, Enderlein, "Die Krise im Euro-Raum: Auslöser, Antworten, Ausblick", (2010) Aus Politik und Zeitgeschichte, 7-12
90. On the institutional creation of the EMU see Louis, "A legal and institutional approach for building a monetary Union", 35 CML Rev. (1998), 33-76.
91. Schulze-Steinen, Rechtsfragen zur Wirtschaftsunion (1998), pp. 52 et seq.
92. thed. (2003), "Vorbemerkung zu den Artikeln 98-124?, para 4.
93. thed. (2011), Art. 121 AEUV, paras. 3 et seq.
94. Cf. also Chalmers, Davies and Monti, European Union Law, 2nd ed. (CUP, 2010), pp. 740 et seq.
95. The qualified majority being calculated in accordance with Art. 238(3)(a) TFEU.
96. Communication from the Commission to the European Parliament, the Council, the European Central Bank, the European Economic and Social Committee and the Committee of the Regions Enhancing economic policy coordination for stability, growth and jobs - Tools for stronger EU economic governance, Doc. COM(2010)367 final of 30 June 2010.
97. Colloquially known as the "Rehn-package" or the "sixpack"
98. Regulation (EU) of the European Parliament and of the Council of 4 October 2011 on the prevention and correction of macroeconomic imbalances (Commission proposal: COM(2010)527 final). Adopted as P7_TA(2011)0424.
99. COM(2010)527 final, p. 5 (emphasis added).
100. Regulation (EU) of the European Parliament and of the Council of 4 October 2011 on enforcement measures to correct excessive macroeconomic imbalances in the euro area (Commission proposal, COM(2010)525 final). Adopted as: P7_TA(2011)0292.
101. Conclusions of the European Council 24/25 March 2011, Doc.EUCO10/11, pp. 13-20.
102. For details cf. (last visited 4 Oct. 2011).
103. Council Regulation (EC) No. 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies, O.J. 1997, L 209/1, as amended by Council Regulation (EC) No. 1055/2005 of 27 June 2005 amending Regulation (EC) No. 1466/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies, O.J. 2005, L 174/1.
104. Council Regulation (EC) No. 1467/97 of 7 July 1997 on speeding up and clarifying the implementation of the excessive deficit procedure, O.J. 1997, L 209/6.
105. On the preceding events cf. Louis, "The Economic and Monetary Union: Law and institutions", 41 CML Rev. (2004), 578.
106. Council Regulation (EC) No. 1056/2005 of 27 June 2005 amending Regulation (EC) No 1467/97 on speeding up and clarifying the implementation of the excessive deficit procedure, O.J. 1997, L 174/5.
107. Council Directive of 4 Oct. 2011 on requirements for budgetary frameworks of the Member States, Commission proposal: Doc. COM(2010) 523 final. EP assent P7_TA (2011)0426.
108. Cf. the explanation in Doc. COM(2010) 523 final.
109. Regulation (EU) of the European Parliament and of the Council of 4 Oct. 2011 amending Regulation (EC) No. 1466/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (Commission proposal: COM(2010)526 final). Adopted in EP: P7_TA (2011)0421.
110. Regulation (EU) of the European Parliament and of the Council on the effective enforcement of budgetary surveillance in the euro area (Commission proposal: COM(2010)524 final). Adopted in EP: P7_TA(2011)0290.
111. Council Regulation (EU) amending Regulation (EC) No. 1467/97 on speeding up and clarifying the implementation of the excessive deficit procedure (Commission proposal: COM(2010)522 final). Adopted in EP: P7_TA(2011)0425.
112. For the conclusion of the first European Semester see Conclusions of the European Council of 23/24 June 2011, EUCO 23/11, p. 2.
113. Cf. Rodi, in Vedder and Heintschel von Heinegg (Eds.), Europäischer Verfassungsvertrag (2007), Art. III-194.
114. On the preceding Art. III-88 of the Convention Draft and its history see Doc. CONV 727/03 of 27 March 2003, Annex II, p. 9, the discussion by Amtenbrink
115. and the historical outline by Häde, "Art. 136 AEUV - eine neue Generalklausel für die Wirtschafts- und Währungsunion?", (2011) JZ, 336-337.
116. Ohler, "Die zweite Reform des Stabilitäts- und Wachstumspakts", (2010) Zeitschrift für Gesetzgebung, 338 and 342
117. 123 Entscheidungen des Bundesverfassungsgerichts, 361 et seq
118. The relevant passage (taken from the translation of the Court's website, (last visited 4 Oct. 2011)) reads as follows (para 256): "A transfer of the right of the Bundestag to adopt the budget and control its implementation by the Government which would violate the principle of democracy and the right to elect the German Bundestag in its essential content would occur if the determination of the type and amount of the levies imposed on the citizen were supranationalized to a considerable extent. The German Bundestag must decide, in an accountable manner vis-à-vis the people, on the total amount of the burdens placed on citizens. ...".
119. Cf. only Ruffert, "An den Grenzen des Integrationsverfassungsrechts: Das Urteil des Bundesverfassungsgerichts zum Vertrag von Lissabon", (2009) DVBL, 1202.
120. Of course, this was developed in Friedrich von Hayek's seminal lecture Der Wettbewerb als Entdeckungsverfahren (1968), pp. 7 et seq.
121. See the thorough analysis of the constitutional regime and its recent reform by Ohler, "Maßstäbe der Staatsverschuldung nach der Föderalismusreform II", (2009) DVBL, 1265-1274
122. The famous dictum of Case 294/93, Les Verts, [1986] ECR 1339, para 23, is recalled here: "It must first be emphasized in this regard that the European Economic Community is a Community based on the rule of law, inasmuch as neither its Member States nor its institutions can avoid a reviewof the questionwhether the measures adopted by them are in conformity with the basic constitutional charter, the Treaty."
123. The value- and principle-oriented nature of EU law has recently been demonstrated in a scholarly most impressive way byVon Bogdandy, "Founding principles of EU law:A theoretical and doctrinal sketch", 16 ELJ (2010), 95-111
124. on principles, and Calliess, "Europa alsWertegemeinschaft - Integration und Identität durch europäisches Verfassungsrecht?", (2004) JZ, 1033-1045, on values