Germany

IV - Early Emergency Funding

Prior to 2010, loan assistance to States was made primarily via bilateral agreements (to Latvia, Hungary, Romania, 1st round of Greek loan assistance).          
The European Financial Stabilisation Mechanism (EFSM) and the European Financial Stability Facility (EFSF) are two temporary emergency funds, both resulting from the turbulent political weekend of 7-9 May 2010. On May 9, a Decision of the Representatives of the Governments of the Euro Area Member States was adopted expressing agreement on both funds.      
The EFSM is based on a ‘Council regulation establishing a European financial stabilisation mechanism’ of May 11, 2010 adopted on the basis of article 122(2) TFEU and therefore binding on all 27 member states of the EU.  
(http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2010:118:0001:0001:EN:PDF)
The EFSF is a special purpose vehicle created under Luxembourgish private law by the 17 member states of the Eurozone. The EFSF Framework Agreement was signed on June 7, 2010. On June 24, 2011, the Heads of State or Government of the Eurozone agreed to increase the EFSF’s scope of activity and increase its guarantee commitments.
(http://www.efsf.europa.eu/attachments/20111019_efsf_framework_agreement_en.pdf and http://www.efsf.europa.eu/attachments/faq_en.pdf)

Negotiations
IV.1    
What political/legal difficulties
did Germany encounter in the negotiation of the EFSF and the EFSM, in particular in relation to (budgetary) sovereignty, constitutional law, socio-economic fundamental rights, and the budgetary process?

No difficulties known.

 

Entry into force         
IV.2    
Article 1(1) EFSF Framework Agreement provides that it will enter into force if sufficient Eurozone member states have concluded all procedures necessary under their respective national laws to ensure that their obligations shall come into immediate force and effect and provided written confirmation of this. What does this procedure look like in Germany and in what way does it involve Parliament?

The German Bundestag has to consent to the issuance of new financial commitments. According to Article 115 (1) GG, a federal law has to be adopted if Germany decides to take over borrowing obligations. The provision requires the authorization by a federal law for “the borrowing of funds and the assumption of surety obligations, guarantees, or other commitments that may lead to expenditures in future fiscal years”.

 

This is why Article 115 (1) GG formed the legal basis upon which the Act on the Assumption of Guarantees within the Framework of a European Stabilisation Mechanism (StabMechG)[1] was adopted by the German legislator on 22 May 2010.[2] The StabMechG authorized the Federal Ministry of Finance to issue guarantees up to the amount of Euro 123 billion with a possible extension of 20%.

 

The StabMechG was adopted via the usual procedure for the adoption of federal laws in Germany. However, the procedure only lasted 11 days which is very fast in comparison to other federal laws. The draft law was introduced in the legislative procedure by the governing coalition of the parliamentary groups of Christian Democrats (CDU/CSU) and Liberals (FDP) on 11 May 2010.[3] After the Budget Committee of the Bundestag had proposed some modifications to the draft law on 19 May 2010, the Bundestag adopted the modified version of the law on 21 May 2010 with 319 Yes votes, 73 No-Votes and 195 abstentions in a ballot by name.[4] The majority of MPs of the then governmental parties Christian Democrats (CDU/CSU) and Liberals (FDP) voted in favour of the law. However, there were four Christian Democrats and two Liberals who voted against the law as well as the complete parliamentary group of Left (Die Linke). The Social Democrats (SPD), the Greens (Bündnis 90/Die Grünen), three Christian Democrats and one Liberal abstained. The same day, the Bundesrat gave its consent to the StabMechG.[5] On 22 May 2010, the law was signed by the Federal President and entered into force via publication in the Federal Law Gazette.

 

The StabMechG was amended twice. The first modification, which entered into force on 9 October 2011, raised the guarantee sum from Euro 123 billion to Euro 211 billion and adapted the German law to the modifications of the EFSF-framework treaty.[6] The parliamentary voting by name in the Bundestag on 29 September 2011 led to the following result: 523 Yes-votes (governing coalition of Christian Democrats (CDU/CSU) and Liberals (FDP); Social Democrats (SPD) and the Greens (Bündnis 90/Die Grünen) from the opposition), 85 No-votes (the parliamentary group of the Left (Die Linke), one Social Democrat and one Green MP – all from the opposition, 10 Christian Democrats and three Liberals from the governing coalition) and 3 abstentions (one Social Democrat, one Christian Democrat and one Liberal).[7]

The second amendment, which was published in the Federal Law gazette on 23 June 2012 entered into force on 1 June 2012, strengthened the participation rights of the parliament.[8] The amendment was supported by all parliamentary groups, except the Left (Die Linke) forming part of the opposition.[9]

 

Guarantees
IV.3    
Member states are obliged to issue Guarantees under the EFSF. What procedure was used for this in Germany? What debates have arisen during this procedure, in particular in relation to the implications of the guarantees for (budgetary) sovereignty, constitutional law
, socio-economic fundamental rights, and the budgetary process?

The procedure is laid down in the StabMechG. According to this law, the Federal Ministry of Finance is authorized to issue guarantees up to an amount of Euro 211 billion for financial assistance programmes which the European Financial Stability Facility carries out to implement the emergency measures to the benefit of a euro-area Member State. Such guarantees can only be issued if it is indispensable to safeguard the stability of the euro area as a whole. In addition, there must be a common agreement by the euro-area Member States (excluding the Member State asking for financial support), the European Central Bank (ECB) and – where possible – the International Monetary Fund (IMF). Emergency measures can only be approved if the respective Member State agrees to strict conditions in the context of an economic and fiscal policy programme.

 

The StabMechG contains a further norm which binds the German representative in the EFSF board to a decision of the German Bundestag if the EFSF-decision affects the overall budgetary responsibility of the German Bundestag. The German representative is obliged to vote against an EFSF-decision as long as there is no other parliamentary authorization. The overall budgetary responsibility shall be deemed to be affected in particular

  1. in the event of the conclusion of an agreement on an emergency measure from the European Financial Stability Facility at the request of a euro-area Member State,
  2. in the event of a significant amendment to an agreement on an emergency measure, an amendment to its instruments and terms, and in the event of an amendment that has an impact on the amount of the guarantee facility,
  3. in the event of amendments to the Framework Agreement for the European Financial Stability Facility,
  4. in the event of the transfer of rights and obligations from the European Financial Stability Facility to the European Stability Mechanism, and
  5. in the event of the adoption of a significant amendment by the Federal Government to the guidelines of the Board of Directors of the European Financial Stability Facility.

 

If a decision of the Bundestag is not necessary, the Budget Committee must be informed and has the right to deliver opinions on the respective decisions. Furthermore, the StabMechG introduced a new sub-group of the Budget Committee (Stabilisation Board) which decides in all cases in which the Federal Government invokes the particular confidentiality of the matter. In addition, the Federal Government shall provide the German Bundestag with information on a comprehensive basis, as early as possible, continuously and, as a rule, in writing in matters pertaining to the StabMechG.

 

The Bundestag approved upon application of the Federal Government financial assistance in the framework of the EFSF for Ireland on 1 December 2010 (approval by the Budget Committee), for Portugal on 12 May 2011, for the Hellenic Republic on 27 February 2012[10], and for Spain on 19 July 2012[11]. Furthermore, there had been authorisations of the Bundestag to extend the term for loans in the framework of the EFSF for Spain and Portugal[12] as well as for Ireland[13] and the Hellenic Republic.[14]

 

As outlined below under question IV.4 the scope of the guarantees taken up by Germany was rarely debated in the legislative negotiations on the StabMechG in May, 2010. Mainly the possible extension of the guarantees of up to 20% was criticized. The opposition feared that such extension could become a ‘blank check’ for financial guarantees. Such fear mainly resulted from the fact that the legal details of the EFSF Framework Agreement were not known at the time when the Bundestag was supposed to vote on the StabMechG. [15]

This is why the parliamentary group The Greens (Bündnis 90/Die Grünen) asked the Federal Government after the entry into force of the StabMechG (the Greens abstained) whether it is intended to receive parliamentary approval for the EFSF-framework treaty. From their point of view, a parliamentary approval was required pursuant to Article 59 (2) GG because the framework treaty must be seen as a treaty regulating the political relations of the (German) Federal State. However, the Federal Government negated this question because they were of the opinion that the EFSF-framework treaty was a civil law agreement which does not fall within the category of Article 59 (2) GG-treaties.[16]

 

In the course of the first modification of the StabMechG which led to an increase of the guarantee sum, there were controversial discussions about the (in-)compatibility of the law with the German Constitution, in particular concerning participation rights of the parliament. The StabMechG transfers essential decision rights concerning EFSF-matters to a sub-group of the Budget Committee consisting of nine Members of Parliament in order to enable prompt decision in emergency cases. The Social Democrats (SPD) argued that it is not compatible with the German Constitution to transfer such parliamentary rights to a group of nine Members of Parliament.[17] The Left (Die Linke) entirely refused financial assistance measures such as provided for by the EFSF because these measures do not help financially suffering countries but increase social injustice.[18]

 

In the plenary debate on the first amendment of the StabMechG the extension of the guarantee sum up to Euro 211 billion was mainly criticized by The Left (Die Linke). Its head of the parliamentary group, Gregor Gysi, asked the Federal Government to promise that the guarantees issued by Germany would not be adopted at the cost of German pensioners, employees and small businesses.

 

The Greens (Bündnis 90/Die Grünen) criticized the “salami politics” of the Federal Government with regard to the necessity of financial guarantees. One of its MPs, Jürgen Trittin, accused the Federal Government of regularly defining financial red lines only to overstepping them shortly afterwards.[19] Gerhard Schick, another MP from the Greens, referred to rumors speculating that the lending capacity of the EFSF will be enlarged above the amount of Euro 750 billion and demanded the Federal Government to clarify if there is any validity behind such rumors.[20]

 

The most controversial debate about the enlargement of the EFSF concerned the participation rights of the Bundestag in EFSF decisions. For a detailed summary of the debate and its outcome see below under question IV.4, under II.2a, question IV.4, under III, 4 and question IV.5.

 

Activation problems          
IV.4    
What political/legal difficulties
did Germany encounter during the national procedures related to the entry into force of the EFSF Framework Agreement and/or the issuance and increase of guarantees?

I. General Facts and Modus of Examination

 

The subsequent analysis focuses on the controversies that arose in the German Bundestag mainly with regard to the adoption of the European Financial Stability Facility (EFSF). The other measure mentioned above, the European Financial Stabilisation Mechanism (EFSM), was hardly discussed in the Bundestag as it was based on a Council Regulation[21] and, therefore, did not need the Bundestag’s formal approval. The EFSF, on the other hand, had to be implemented by the Bundestag through the means of a federal law. Nevertheless, the arguments for and against the EFSF and the EFSM are inextricably linked and were often voiced conjointly in the Bundestag debate.

 

Before outlining the analytical sources applied for the assessment of the negotiations about the EFSF, the main features of the legislative process in Germany will be summarized.

 

The Bundestag is the most important institution of the legislative process in Germany on the federal level as it decides (mostly together with the Bundesrat which represents the Länder) on all federal laws. Members and parliamentary groups of the Bundestag are able to introduce and revise new pieces of legislation as bills (also known as the ‘right of initiative)’. The Bundesrat and the Federal Government are also entitled to introduce new legislative proposals. Overall, 2/3 of the bills introduced stem from the Federal Government. Nevertheless, it is the Bundestag where these bills are debated, modified, and voted on through a complex legislative procedure.[22]

 

Usually a bill is presented and debated in the first plenary session of the Bundestag and then referred to the parliamentary committees (where expert hearings take place and bills are revised and modified). Further, in accordance with Rule 62 of the Rules of Procedure of the Bundestag, the Lead Committee recommends to the Bundestag a definite decision on the bill (the acceptance of the bill or the addition of amendments). Such decision is formally submitted to the Bundestag in a so-called recommendation („Beschlussempfehlung“) together with a report („Bericht”), the latter of which specifies the deliberations of the committee in more detail. In the end, the committee’s recommendation is debated in the second plenary of the Bundestag session and then usually voted upon in the third plenary session.[23]

 

In addition, also the Bundesrat participates in the legislative procedure and depending on the nature of the bill and the majority structures in the Bundesrat, the bill may even be rejected. If Bundestag and Bundesrat have consented to a bill, it enters into force once it is signed by the Federal President and published in the German Law Gazette (“Bundesgesetzblatt”).[24]

 

In the subsequent assessment of the legislative debate on the EFSF, two main sources of the legislative process will be drawn on: First, the plenary sessions will be analyzed, which are mainly used by members of the Bundestag to convey political standpoints to the public and the media (all debates can be found in the so-called plenary protocols, “Plenarprotokoll”).[25] Second, the recommendations and reports of the respective Lead Committee will serve as a basis for the assessment. [26] The reports are especially interesting as they contain a detailed summary of the positions of all parliamentary groups on the respective bill.

 

The Bundestag adopted three laws with regard to the EFSF:

 

First, on 22 May 2010 the ‘Law for the Acquisition of Guarantees within the Framework of a European Stabilization Mechanism’[27] (StabMechG) was adopted, which authorized the issuance of EFSF guarantees (see question IV.3). It was discussed together with the European Financial Stabilization Mechanism (EFSM), as outlined below.

 

Second, on 14 October 2011 the financial capabilities of the EFSF were extended through revising the StabMechG.[28]

 

Third, on 23 May 2012 the parliamentary rights regarding EFSF-measures were strengthened via a second amendment of the StabMechG.

 

Below, the debates on these laws will be presented separately, as the content and scope of the controversies differ notably.

 

II. Parliamentary negotiations on the EFSM and the StabMechG in May 2010

 

1. The Position of the Government

 

On 19 May 2010, Chancellor Angela Merkel held a Federal Government Declaration (“Regierungserklärung”) to the Bundestag. Those declarations are usually made during the election period, if policy-program corrections are inevitable, if issues of high public interest are at stake, or if important decisions have been taken on an international level.[29] Merkel explained her position with regard to the EFSM and the EFSF that had been initiated in several EU and Eurozone meetings during the weekend of 7-9 May 2010.

 

Merkel used drastic words in the Government Declaration in order to persuade the members of the Bundestag on the importance and necessity of the rescue packages.[30] By and large, two main arguments can be identified in Merkel’s Government Declaration that have been repeatedly used by the Federal Government throughout the financial crises to justify EU rescue measures.

 

First, Merkel linked the survival of the euro to the survival of the European project. She stressed that rescue measures are not only necessary to stabilize the Eurozone. To a larger degree, it is about “the preservation and probation of the European idea”[31]. According to Merkel, the Eurozone is a ‘community of fate’ and “if the Euro fails, Europe fails”.[32]

 

Second, Merkel promised to introduce stricter fiscal policy measures at the EU level as a ‘trade-off’ for the loan guarantees Germany had taken over. Merkel pointed out that a “new culture of stability” is needed in the European Union in order to improve the fiscal policy coordination and mutual supervision amongst all EU member states.[33] Merkel further stated “such rules should not depend on the weakest [Member State], but must be in conformity with the strongest”[34]. She concluded that her Government would fight for economically necessary fiscal policy measures – even if they were not supported by all EU Member States.

 

In the report of the Budget Committee, the then governmental parliamentary coalition of Christian Democrats (CDU/CSU) and Liberals (FDP)[35] reinforced this position of the government through reference to the expert hearing that took place on 19 May.[36] The conclusion of the experts was that financial assistance was necessary in order not to threaten the solvency of Eurozone states and provoke a further escalation of the crises. The experts also strengthened the government’s assessment that the rescue measure would not violate the ‘no-bailout’ clause of Article 125 TFEU (for details on the latter issue see part II.2 of this answer).[37] 

 

2. The Debate

 

Not many MPs opposed to the general idea behind the financial measures presented by Merkel. Only the parliamentary group The Left (Die Linke) voiced strong doubts (see below).

 

Other parliamentary groups in the Bundestag (Social Democrats (SPD) and the Greens (Bündnis 90/Die Grünen)) agreed with the necessity of a financial rescue package. The parliamentary leader of the Social Democrats, Frank-Walter Steinmeier, even said: “Let us be true: the decisions taken on May 8th and 9th – which were far-reaching decisions to save the euro – were correct.”[38] According to the Greens “the rescue fund to support the euro is in its intention the right signal of the European Union against financial speculations.”[39]

 

Overall, two major topics were debated: first the lack of involvement of the Bundestag in the elaboration of the EFSM/EFSF and second Merkel’s wavering position regarding the idea of a Financial Transaction Tax (FTT). The parliamentary group The Left from the opposition also heavily criticized the austerity measures imposed on EU Member States in return for receiving loans.   

 

a. The Lack of Involvement of the Bundestag

 

First, all opposition parties (Social Democrats, the Greens and the Left) criticized the information and transparency policy of the Merkel government before, during and after the Eurozone meetings on the weekend of 7-9 May 2010.

 

In particular, the Greens and the Left accused Merkel of having violated Article 23 (3) GG according to which the Federal Government is obliged to inform the Bundestag prior to the adoption of legislative acts in European matters and consider the position of the parliament in the negotiations on the European level.[40] The allegation of having violated the German Basic Law is especially important because it became subject to several cases brought to the German Federal Constitutional Court (FCC) (see question IV.5).

 

The Social Democrats did not overtly accuse the Federal Government of having breached the German Constitution but criticized that Merkel had not convincingly explained why the European Council decided so rapidly about the rescue measures. Merkel had claimed that the speedy procedure was necessary due to the turmoil of the markets. However, in the view of the Social Democrats, Merkel had failed to deliver evidence to proof this.[41]

 

Further, all three opposition parties criticized the fact that the Bundestag was supposed to vote on the StabMechG at a point in time when the legal details of the EFSF Framework Agreement were not yet known. The background to this criticism was that the parliamentarians knew about the financial scope of the EFSF but had not seen the legal provisions of the EFSF agreement in detail. What worried the parliamentarians most was the fact that the extension of 20 % of the German guarantee sum could become a ‘blank check’.[42] The parliamentary leader of the Greens, Jürgen Trittin, claimed that it is an “affront towards the parliament” that Merkel expects the Bundestag to vote on a rescue package of which the details are unknown.[43]

 

In order to attenuate the opposition’s criticism with regard to the involvement of the Bundestag, the then government coalition of Christian Democrats (CDU/CSU) and Liberals (FDP) together with the Greens introduced an amendment to the StabMechG (§ 1 (4) and (5)) after the first reading in plenary at the stage of the Budget Committee discussion.[44] The amendment had two main results: First, the Government assures to submit missing legal details of the EFSF to the Budget Committee before the final issuance of guarantees. Second, the Federal Government commits itself to make efforts in order to reach consensus with the Budget Committee before the issuance of new guarantees. Only in urgent situations, guarantees can be issued without prior consent of the Budget Committee, however the Federal Government has to inform the Committee afterwards without delay.

 

The amendments are – amongst others – relevant for cases in which the EFSF Board of Directors has to give its approval to loan requests of Eurozone states. Through the StabMechG, the Bundestag authorized the Federal Government, and thus by extension also the German EFSF representative, to issue loan guarantees up to the amount of Euro 123 billion. However, this does not mean that the Federal Government and its representatives in the EFSF could freely decide about the German guarantee sum. It is always necessary that the Federal Government makes efforts to reach consensus with the Budget Committee before the issuance of new guarantees (see also question IV.3). The wording of this obligation was however very weak and corrected in the Bundesverfassungsgericht’s judgment on 7 September 2011.[45] (see also question IV.5)

 

Eventually and despite the government’s endeavors to attenuate the opposition’s criticism through the integration of the amendments, the StabMechG was not supported by the oppositional parliamentary groups. Social Democrats and the Greens abstained, The Left opposed to the bill (for voting details see under paragraph 4).

 

b. Regulation of Financial Markets

 

Another issue that was repeatedly criticized by the opposition was the fact that the Federal Government did not take a clear position on how to restrict threats arising from financial markets. The opposition pointed out that they perceive the unregulated financial markets as a major source of the crisis. The parliamentary leader of the Greens, Jürgen Trittin, criticized the government for not having a steady position with respect to a FTT.[46] The parliamentary leader of the Social Democrats, Frank-Walter Steinmeier, criticized Chancellor Merkel for her wavering position regarding a FTT.[47]

 

In the report of the Budget Committee, the Social Democrats argued that progress in the fight against the financial crisis can only be made if the financial sector will be involved and held accountable. In the end, they even tied their consent to the StabMechG to a (written) promise of the Federal Government to introduce adequate regulatory measures of financial markets and introduce a financial transaction tax (at the G20 level or if that’s not possible at the EU level).[48] The Government refused to submit such a written promise (see under paragraph 4 below).

 

The Left criticized the Government’s approach towards the FTT and laid out a specific proposal on how to best regulate the financial markets in the report of the Budget Committee. With regard to the rescue packages, they mainly opposed to EU austerity measures tied to the granting of loans.[49] Their parliamentary leader, Gesine Lötzsch, thus requested an EU stimulus package, financed through 2 % of every Member State’s GNP. She said that the draconic austerity measures introduced on the basis of Merkel’s “neoliberal recipe” put economic recovery at risk and threaten social peace in Europe.[50]

 

4. Voting Behavior in the Bundestag

 

The 17th German Bundestag consisted of 620 MPs in total. On 21 May 2010, the StabMechG was voted on. 587 parliamentarians casted their votes, of which 319 were in favour and 73 against the law. 195 parliamentarians abstained. The positive votes stemmed from the governing coalition, the negative votes were mainly casted by the The Left, however, there were also 5 no-votes from the governing coalition and 1 from the Social Democrats (SPD). Social Democrats and the Greens mainly abstained.[51]

 

The Social Democrats justified their abstention-vote with the fact that Merkel had not submitted a written promise to introduce a FTT.[52] After all, this justification allowed the SPD to confirm its general consent with the StabMechG without voting in favour of it. The Greens argued that although they agree with the content of the StabMechG, they voted with abstention because the Federal Government had ignored the necessary procedures to involve and adequately inform the Bundestag.[53] The Left said that it would have voted for the bill if the government would have guaranteed to regulate financial markets and not force other EU states to raise taxes and decrease their social spending.[54]

 

III. Parliamentary negotiations about the amendment of the StabMechG in October 2011

 

On 21 July 2011, European leaders convened in Brussels for an emergency summit due to the worsening of the financial crisis in the Eurozone. The aim was to address the three major challenges of the crisis, namely debt solvency, contagion, and growth. In the end, two major decisions were taken. First, a new rescue package was adopted for Greece up to the amount of Euro 109 billion. Second, the political leaders agreed to enlarge the lending capacity of the EFSF from Euro 440 billion to Euro 780 billion. Overall, the enlargement of the EFSF meant that Germany had to increase its loan guarantees from Euro 123 billion to Euro 211 billion.

 

The first plenary debate on the EFSF took place on 8 September 2011, which consisted of two major elements: First, the enlargement of the EFSF was discussed on the basis of the bill called the ‘Law Amending the Law for the Acquisition of Guarantees within the Framework of a European Stabilization Mechanism’. Second, the strengthening of the Bundestag’s participation rights was discussed based on a resolution by the parliamentary groups of Christian Democrats (CDU/CSU) and Liberals (FDP), called ‘Securitization and Strengthening of the Parliamentary Rights with regard to further European Stabilization Measures’.[55] During the committee proceedings, the resolution was integrated into the amendment proposal and voted on as one bill in the Bundestag.

 

1. The Position of the Government with regard to the Enlargement of the EFSF

 

In the first plenary session on 8 September 2011, Finance Minister Wolfgang Schäuble explained the government’s position: He justified the necessity of expanding the EFSF budget through referring to the danger of contagion in the Eurozone. Schäuble explained that “[w]e needed to create this mechanism so that the problems of a country cannot be a threat to the stability of the entire euro zone."[56] The chairman of the parliamentary group of CDU/CSU, Volker Kauder, argued in favour of the EFSF by exposing its broader implications. “[I]t is not only about the expansion of the rescue fund […], it is about our future. It’s about jobs. It’s about perspectives, especially for the younger generation”[57], he argued.

 

In line with the rhetoric and argument of the Merkel government, Schäuble demanded the Eurozone countries in need of loans to mobilize their own efforts for reform. When it comes to giving out credits to cash-strapped states such as Greece, it is about providing help for the matter of self-help. “[T]he causes of the problems need to be solved by the countries themselves” [58], he claimed. The chairman of the FDP, Rainer Brüderle, said “if the Greeks fail to stick to their commitments, there will be no money; that is the rule of the game.”[59]

 

Schäuble further remarked that a change of the EU Treaties might be necessary in the long-term. It is very difficult to pacify the financial markets with the existing EU Treaties in a sustainable manner. The markets expect us to create a better institutional structure for our common currency. “[T]hat’s the direction we have to take.”[60]

 

2. The Debate

 

The expansion of the EFSF was much more controversial than its establishment in May 2010. Criticism was voiced strongly by the opposition parties and even came from within the government coalition.

 

In fact, until shortly before the voting, it was not clear if Merkel would receive the so-called Chancellor majority (“Kanzlermehrheit”[61]). One of the most prominent critics of the expansion of the EFSF within the governing parties was the vice-chairman of the parliamentary group of the Christian Democrats (CDU/CSU), Wolfgang Bosbach.[62] He criticized that the enlargement of the EFSF marks the transformation of the Monetary Union into a Debt Union, which is “not a way out of the crisis but rather a way into a crisis.”[63] According to him, the no-bail-out clause pursuant to Article 125 TFEU intends to ensure that over-indebtedness cannot be passed on to other Eurozone states.[64] Despite the opposition of some CDU-politicians, Merkel received the majority of votes in the Bundestag for the extension of the EFSF.[65]

 

Even the opposition parties Social Democrats and the Greens voted in favour of the EFSF enlargement. However, this did not preclude them to engage in a furious debate. Three issues – that were only indirectly connected to the EFSF expansion – became central points of discussion in the debate: first the handling of the crisis by the government, second the government crossing ‘red lines’, and third Merkel’s position towards Eurobonds. These issues were mainly discussed in the plenary sessions. The issue of improving the Bundestag’s participation rights was mainly dealt with in the parliamentary committees.

 

a. The Course of Action in the Crisis by the Federal Government

 

Already in the first plenary session, Social Democrats (SPD) and the Greens (Bündnis 90/Die grünen) confirmed that they would vote in favour of the EFSF-expansion. The parliamentary leader of the Greens, Jürgen Trittin, said that it is a matter of solidarity to be in favour of the enlargement of the EFSF. The former Finance Minister and MP Peer Steinbrück (Social Democrats) claimed that the enlargement of the EFSF is the “right step”[66].

 

Nevertheless SPD-Chairman, Sigmar Gabriel, accused the Federal Government of having worsened the crisis via “short-sighted and populist slogans” with regard to Greece.[67] Peer Steinbrück said that Merkel misses “a guiding principle, a perspective, a strategy, including a plan B and C” for dealing with the crisis.”[68] What is necessary is “a new narrative about Europe” which is not confined to the EU being an intergovernmental organization. Only then can it become clear why Germany has the responsibility to help stabilising the Euro currency.[69] 

 

b. Crossing ‘Red Lines’

 

The Greens criticized the “salami politics” of the Federal Government. Their parliamentary leader Jürgen Trittin accused the Federal Government of regularly defining ‘red lines’ only to overstep them shortly afterwards. “First, it was said: no cent for Greece and then a rescue package for Greece was implemented. The next red line was: no adoption of a rescue package and then the EFSF was established. Now it is: no permanent bailout fund but soon the ESM will be created.”[70] Another MP of the Greens, Gerhard Schick, referred to rumors speculating that the lending capacity of the EFSF should even be enlarged to up to Euro 1 billion and demanded the Federal Government to clarify if there is any validity behind such rumors.[71]

 

c. Eurobonds

 

Although not directly linked with the debate about the EFSF, all opposition parties criticized Merkel for her position in relation to Eurobonds. Sigmar Gabriel (Social Democrats) said that the Federal Government’s argument of the Eurobonds being an illegal pooling of debt is not credible, as the government has asked the ECB to do the same through buying bonds of indebted countries up to the amount of Euro 120 billion.[72] Jürgen Trittin (the Greens) spoke of the “European and monetary ghost-ride”[73] of the Federal Government. It is irresponsible to rant against Eurobonds although they have been introduced through the back door already, he said.[74] The parliamentary leader of the parliamentary group the Left (Die Linke), Gregor Gysi, called on the government to tell the truth about the introduction of Eurobonds.[75]

 

3. Voting Behavior in the Bundestag

 

On 29 September 2011, the amendment bill was voted on in the Bundestag. 611 parliamentarians casted their votes, of which 523 were in favour and 85 against the bill. 3 parliamentarians abstained (one from the Christian Democrats (CDU/CSU), one from the Liberals (FDP) and another one from the Social Democrats (SPD)). The positive votes stemmed from the governing coalition (Christian Democrats and Liberals), the Social Democrats and the Greens. Interestingly 10 MPs from CDU/CSU, 3 MPs from the FDP and one MP from the SPD voted against the amendment bill.

 

4. Improving the Participation Rights of the Bundestag

 

The improvement of participation rights of the Bundestag will be explained and focused on in greater detail as it has been one of the most controversial and important issues in the German constitutional debate. Especially Germany’s Federal Constitutional Court (FCC) has ever since its Maastricht judgment in 1993 defined the legal grounds for a stronger role of the Bundestag in European matters. In the following, it will be explained how and why participation rights of the Bundestag are improved by the amendment bill.

 

In the StabMechG, adopted on 22 May 2010, the Federal Government was only obliged to make efforts to reach consensus with the Bundestag’s Budget Committee before the issuance of new guarantees and could – in urgent situations – even issue them without prior consent of the Bundestag (for more details see paragraph II, 2a of this answer). In the public debate, the weak participation rights of the Bundestag were criticized, yet it was not until the enlargement of the EFSF that the public debate erupted.

 

The controversy started on 24 August 2011, when the German newspaper ‘Handelsblatt’ published an article reporting that Finance Minister Schäuble was striving for a regulation according to which the EFSF should be able to issue loan guarantees without prior consent of the Bundestag. The President of the Bundestag, Norbert Lammert, clarified in the same issue of ‘Handelsblatt’ that the Bundestag would not agree to such general authorization of guarantees. On 7 September 2011, the Federal Constitutional Court confirmed Lammert’s position. According to the FCC, the Bundestag’s budget responsibility has to be protected, especially in times of increased international cooperation and European integration. Amongst others, the Court ruled that the budget autonomy of the Bundestag was not sufficiently protected, as the Federal Government was simply obliged to make efforts to reach an agreement with the Budget Committee (see question IV.5).

 

This is why, the coalition parties of Christian Democrats (CDU/CSU) and Liberals (FDP) introduced a resolution on strengthening the Bundestag’s participation rights, called ‘Securitization and Strengthening of the Parliamentary Rights with regard to further European Stabilization Measures’. During the committee proceedings, the latter resolution was integrated into the amended StabMechG and consented to by all parliamentary groups (excluding the parliamentary group The Left (Die Linke)). Interestingly the matter of improving the Bundestag’s participation rights was mainly debated during the committee proceedings and not in plenary sessions.

 

In the following, the provisions on participation rights of the Bundestag will be explained in more detail.

 

First, § 3 StabMechG concerns EFSF measures that touch upon the budget responsibility of the Bundestag. It determines that the German representative to the EFSF can only consent to a decision in the EFSF Board of Directors if the Bundestag has previously consented to it. Four major fields of EFSF matters are identified that concern the budget responsibility of the Bundestag: the issuance of rescue measures for a Eurozone state, the modifications of an existing rescue measure, changes of the EFSF agreement, the transformation of the EFSF into the ESM.[76] § 3 (3) StabMechG specifies that if cases of particular urgency and confidentiality arise, a ‘special body’ will take over the participation rights of the Bundestag. Such a ‘special body’ is supposed to consist of nine members of the Budget Committee according to the majority situation of the Bundestag (the so-called “Neuner-Gremium” (Committee of Nine)).[77] 

 

Second, § 4 StabMechG determines that all other EFSF measures that concern the Bundestag and that are not mentioned in § 3 (2) StabMechG have to be adopted in consent with the parliamentary Budget Committee. Such issues concern the amendment of EFSF Board guidelines or the use of other EFSF instruments, such as the purchase of bonds on the secondary market.

 

Third, § 5 StabMechG regulates how the Federal Government has to inform the Bundestag about new developments, e.g. by submitting relevant documents at the earliest possible time.[78]

 

The most controversial part of the modified participation rights was the establishment of the Committee of Nine (“Neuner-Gremium”). During the committee proceedings, the Social Democrats (SPD) doubted that such a committee would be in conformity with the FCC judgment from 7 September 2011 and thus suggested a less powerful role of this sub-Committee – however without success. Nevertheless, the Social Democrats voted in favour of the amendments.[79]

 

In the end, the first Committee of Nine (“Neuner-Gremium”) was elected on 26 October 2011 for the legislature, constituting of 2 MPs from the Christian Democrats (CDU/CSU), 2 MPs from the Liberals (FDP), 2 MPs from the Social Democrats (SPD), 1 MP from the Greens (Bündnis 90/Die Grünen) and 1 MP from the Left (Die Linke) respectively.[80] One day later, the German Federal Constitutional Court (FCC) banned at the request of two MPs the establishment of the Committee of Nine (“Neuner-Gremium”) by a provisional order – a measure which is only ordered in extraordinary cases by the FCC (see question IV.5).

 

IV. Parliamentary negotiations on the amendment of the StabMechG in May 2012

 

The second amendment of the StabMechG was necessary because of the judgment of the Federal Constitutional Court (FCC) from 28 February 2012 (see for more details on the judgment under question IV.5). In this decision, the FCC declared that the so called Committee of Nine (“Neunergremium”) – a parliamentary sub-Committee of the Budget Committee consisting of 9 MPs who decide about rapid emergency measures in the framework of the German participation in the EFSF – was not in line with the German Constitution.

 

The legislative proposal of this amendment bill was introduced by the parliamentary groups of Christian Democrats (CDU/CSU) and Liberals (FDP), which supported the government at that time, as well as by the Social Democrats (SPD) and the Greens (Bündnis 90/Die Grünen), which were in opposition at that time, aimed at limiting the competences of the Committee of Nine and at creating rules which safeguard that the composition of the Committee represents the majority relations in the plenary.[81]

 

The amendments of the StabMechG led to more competences for the Bundestag in its plenary composition. According to the amendment, the Committee of Nine is still competent for decisions which are in need of a particular confidentiality which is in particular important for certain operations of the EFSF at the secondary market. It comprehends cases in which not only the content but the fact that a discussion and a vote about a certain measure take place must be kept confidential.[82] This is, for example, the case when the EFSF intends to buy government securities at the secondary market.

 

In addition, electing the members of the Committee of Nine will be based on a voting system which requires a personal and secret procedure. Every member of the Committee of Nine will have a replacement and the composition of the Committee will respect the composition of the Bundestag regarding its majority relations and the political emphasis.

 

1. The discussion in the Committee and the Plenary Stage

 

In the debate at the Budget Committee, the Social Democrats (SPD) reminded its members that they had already emphasized in earlier legislative procedures regarding the StabMechG that the rules concerning the Committee of Nine were not in conformity with the German constitution.[83] In the framework of the discussion in plenary session about the amendments of the StabMechG on 27 April 2012, the Social Democrats highlighted it again.[84] They regretted that the government coalition had not been willing to discuss the constitutional concerns of the Social Democrats at that time. However, they appreciated that the government coalition changed their attitude after the judgment of the FCC and worked on an interparliamentary group proposal of the amendment. In addition, the Social Democrats emphasised that the amended law will contain a possibility to hear experts for difficult and highly complex political decisions.

 

The Greens (Bündnis 90/Die Grünen) supported the amendments as well but they criticized that the procedure was – again – dominated by too much rush.[85] Legislative proceedings such as those of the amendment of the StabMechG should take into account other legislative proposals such as the implementation of the ESM and the Fiscal Compact in order to have a more profound and coherent legal situation. The Greens proposed a further amendment of the StabMechG which aimed at strengthening the rights of parliamentary minority groups. However, this proposal was refused in the Budget Committee by the Christian Democrats and the Liberals (government parties). The Social Democrats (SPD) and The Left (Die Linke) as opposition parties abstained. The Greens highlighted their proposal in the plenary session.[86] One of the most prominent MPs from the Greens, Hans-Christian Ströbele, who voted against the StabMechG in earlier legislative proceedings, argued that he is not totally convinced by the amendments but it is an important step into the direction of more parliamentary participation which is why he supported them.[87]

 

The only parliamentary group which opposed to the introduction of the Committee of Nine and which did not support this legislative amendment was the Left (Die Linke). They declared that the amendment improves the participation rights of the parliament but does not go far enough.[88] They did not see the practical and political necessity to have such a Committee at all. From their point of view, all decisions should be discussed in plenary sessions. There are already sufficient rules to take care of the confidentiality in plenary sessions. Otherwise, such decisions would become problematic under aspects of democratic theory – Steffen Bockhahn (The Left) argued in plenary session on 27 April 2012.[89] He criticed the Social Democrats and the Greens because they are responsible for the fact that the government will not have to convince all MPs from the Christian Democrats and the Liberals but will be able to send MPs to the Committee of Nine who will serve loyally for all government decisions.

 

2. Voting Results

 

The parliamentary groups of the Christian Democrats and the Liberals (government) as well as the Social Democrats and the Greens (opposition) voted in favour of the amendments on 27 April 2012. The Left voted against it.[90]

 

Case law        
IV.5    
Is there a (constitutional) court judgment about the EFSM or EFSF in Germany?

I. General Facts about the Federal Constitutional Court

 

The Federal Constitutional Court (Bundesverfassungsgericht), or briefly FCC, is the supreme guardian of the German Basic Law (“Grundgesetz”). Like any other constitutional court, it may not be active on its own but must be called upon. In the framework of Euro crisis measures, two types of proceedings were relevant: The constitutional complaint and the Organstreit proceeding.

 

The German constitution allows any individual that perceives its fundamental rights to have been violated by state action to submit a constitutional complaint (“Verfassungsbeschwerde”) to the FCC. Article 93 (1) no. 4a GG specifies that such constitutional complaints can be filed upon on the basis of a perceived violation of a fundamental right.[91]

 

The jurisdiction of the FCC can also be invoked if disputes between constitutional bodies, such as the Federal President, the Federal Government, the Bundestag, or the Bundesrat. In the former, also known as Organstreit proceeding („Organstreitverfahren“), the matter may concern political party law, electoral law or parliamentary law. This proceeding is pointed out in Article 93 (1) no. 1 GG. Further details about procedural requirements can be found in the Federal Constitutional Court Act (Bundesverfassungsgerichtsgesetz, or briefly BVerfGG) which concretises the constitutional provisions.

 

II. Judgments on the Greek Bailout and the EFSF

 

Since the beginning of the financial crisis in 2008, the Bundesverfassungsgericht had to decide in several cases about the conformity of various German laws implementing EU rescue measures with the German Constitution.

 

The first judgment from 7 September 2011, which concerned the Greek bailout and the EFSF rescue fund, came to the Court as a constitutional complaint by several economists, lawyers, and one politician from the Christian Social Union in Bavaria (CSU). The CSU politician was Peter Gauweiler whose name is also known from the OMT-judgment of the European Court of Justice in 2015.[92] The Bundesverfassungsgericht’s decision from 7 September 2011 was the first leading euro-case and is especially important because the Court developed standards of review that set the grounds for subsequent euro-case rulings.[93]

 

On 28 February 2012, the FCC judged on a dispute between organs of the state (Organstreit proceeding) concerning the lack of involvement of the Bundestag in the administration of the EFSF. In this matter, the FCC had already issued a temporary court order half a year before on 27 October 2011.

 

Throughout the below description of these FCC judgments, a pattern in FCC rulings on European Union matters will be identified. Ever since the Maastricht Case in 1993, the FCC has shown a high sensitivity towards EU integration. However, this support was mostly tied to the Court’s repeated claim to strengthen the role of the German Bundestag in European matters as required by Article 23 (2) GG. This obligation was applied to financial obligations stemming from the European level.

 

 

III. FCC Judgment from 7 September 2011

 

1. Name of the Court

 

Bundesverfassungsgericht/German Federal Constitutional Court (FCC)

 

2. Parties

 

The three constitutional complaints stemmed from two groups of plaintiffs. The first group was comprised of Prof. Karl-Albrecht Schachtschneider, a constitutional law professor from the University of Erlangen (as authorized representative of the group), the financial experts Joachim Starbatty,
Wilhelm Nölling und Wilhelm Hankel, and finally the former CEO of ThyssenKrupp Dieter Spethmann. This group of plaintiffs (except Dieter Spethmann) had already submitted a constitutional complaint to the FCC in 1998 directed against the introduction of the euro currency.[94] However this complaint had been rejected by the FCC because it declared it as obviously unfounded.[95]

 

The second (main) plaintiff was Peter Gauweiler, a member of the Bundestag from the parliamentary group of the Christian Social Union (CSU), a conservative parliamentary group which supported the government at that time. In June 2010, Gauweiler had already submitted an urgent application to the FCC against the German participation in the EFSF.[96] It was yet rejected by the FCC with reference to the possible ramifications for the German public. According to the Court, even a temporary suspension of financial commitments could tremendously reduce the confidence of the markets and therewith lead to “serious economic disadvantages for the general public.”[97]

 

3. Type of action/procedure

 

A constitutional complaint as laid down in Article 93 (1) no. 4a GG in conjunction with §§ 13 no. 8a, 90 et seq. Federal Constitutional Court Act (BVerfGG).

 

4. Admissibility & Arguments of the parties

 

In the judgment, the FCC dedicated more space to the review of admissibility than the review of substance. As the admissibility of the complaints was anything but self-evident and controversially discussed in the run-up to the FCC judgment, it will be pointed out in more detail below.

 

Overall, the Court only regarded the complaints against the Act on Financial Stability within the European Union (WFStG) and the StabMechG as admissible to the extent that they claimed a violation of their right to vote for the Bundestag on the basis of Article 38 (1) and Article 20 (2) GG in conjunction with Article 79 (3) GG.[98] In the view of the FCC, also individuals could claim that their fundamental right to vote for the Bundestag as stated in Article 38 (1) GG is violated if a financial obligation (such as an EU rescue fund) would result in incalculable burdens for the German budget which would limit the Bundestag’s political discretion factually. In their view, every German citizen can legally demand that the German parliament is consulted in questions which are important for the German democracy.

 

Apart from this constitutional complaint, the remaining claims of the plaintiffs were found to be inadmissible by the Federal Constitutional Court, as will be explained below.[99]

 

a. Article 14 GG

 

One of the plaintiff’s complaints was that the two German federal laws at stake, the WFStG[100], a federal law that granted the authorization to provide financial aid to Greece, and the StabMechG, violate the fundamental right to property (Article 14 (1) GG).[101] The plaintiffs argued that the fundamental right to property “guarantees the ‘citizen’s fundamental right to price stability’”[102] and ensures protection against state policy that prompts inflation. The EU rescue measures would trigger inflation and, therewith, diminish the value of (their) property.[103]

 

The FCC declared this claim to be inadmissible. The Court did not decide whether the purchasing power of money is included in the area of protection of the fundamental right to property. However, the Court seems to have doubts about it, at least when there is no more nuanced clarification of the concept of property in regard to the purchasing power of money. The complaints could be rejected in the view of the Court because they did not substantially prove the inflationary effects and the impairment of the value of the euro as a result of the EU rescue measures. Furthermore, the FCC clarified that – in general – it is not its task to review effects on monetary stability caused by economic and financial policy measures.[104]

 

b. EU legal acts

 

The plaintiffs did not only direct their constitutional complaint against the two federal laws but also against several EU legislative acts.[105] In particular, the plaintiffs attacked Council Decision from 9 May 2010 to introduce the Euro Stabilization Mechanism, Council Regulation No. 407/2010 of 11 May 2010 to establish a European Financial Stabilization Mechanism, and the purchase of government bonds of Greece or other Eurozone Member States by the ECB. They claimed that these acts are “ultra vires”, contravene the principle of democracy and infringe on the plaintiffs right under Article 38 (1) GG because they infringe German sovereignty without sufficient democratic legitimation.[106] The FCC considered the challenge of these EU legislative acts to be inadmissible as they were not measures of a German institution.[107] The FCC’s power of legal review is limited to acts from German public institutions.

 

In a similar vein the FCC rejected the plaintiffs’ challenge against the alleged omission of the European Commission to pre-emptively use measures against the indebtedness of Eurozone states as inadmissible. The plaintiffs made the omitted action of the European Commission responsible for the financial crisis. According to the Court, the German Constitution does not establish a duty for the European Commission (or the Federal Government) to pre-emptively intervene in such cases.[108] 

 

c. Article 125 TFEU (‘no-bailout clause’)

 

Especially interesting is the way in which the Court handled the complaint concerning the violation of Article 125 TFEU. The plaintiffs alleged that the financial assistance for Greece as well as the EFSF rescue measure violate Article 125 (1) TFEU. According to this provision, EU Member States should not be liable for the financial commitments of other EU Member States.[109]

 

The FCC encountered this claim in an obiter dictum referring to the parallel requirements resulting from the TFEU and the German Constitution by saying that the „provisions of the European treaties do not conflict with the understanding of the national budget autonomy as an essential competence […] but instead they presuppose it.“ Regardless of that, the FCC pointed out the importance of respecting the stability criteria for a sound budgetary management of Articles 123-126 and Article 136 TFEU. The Court stated that although „the interpretation of these provisions in detail is not essential [for this judgment], the acceptance of liability for decisions of other Member States with financial effects which overstretches the bases of legitimation of the association of sovereign states (“Staatenverbund”) – by direct or indirect communitarisation of state debts – is to be avoided.“[110]

 

5. Legally relevant factual situation

 

None.

 

6. Legal questions & Arguments of the parties

 

The plaintiffs claimed that their right to vote for the Bundestag under Article 38 (1) sentence 1 GG in conjunction with the principle of democracy (Article 20 GG) and the budget autonomy of the Bundestag to be violated by the two German federal laws.

 

With regard to the last argument, the plaintiffs claimed that Article 38 (1) sentence 1 GG grants every German citizen the right that the constitutional rights of the Bundestag are at least in essence safeguarded. The measure at stake, however, would disregard fundamental principles of the German Constitution, such as the principle of the social welfare state (Article 20 (1) GG) or the principles of the constitutional rules governing public finances and the therewith-connected borrowing limits (Article 115 GG).[111] Furthermore, the plaintiffs claimed that via the financial commitments for Member States of the Eurozone, Germany has abandoned its budgetary sovereignty. In particular, the budget autonomy of the Bundestag, which is the essential element of democratic parliamentarism (as stated in Article 110 (2) GG), is severely violated by the measures at stake.[112] 

 

7. Answer by the Court to the legal questions and legal reasoning of the Court

 

In the review of substance, the Bundesverfassungsgericht decided that the constitutional complaints, which were admissible, are unfounded. The Court stated that the „Bundestag has, not eroded its right to decide on the budget in a constitutionally impermissible manner.“[113]

 

Although the Court rejected the constitutional complaints as unfounded, it developed important standards of review that set the ground for subsequent euro-case rulings.

 

a. The Budgetary Responsibility

 

The link between the Bundestag’s budgetary responsibility and the fundamental right to vote was one of the main innovations in German constitutional law following from this case.[114] It’s constitutional basis is laid down in Article 38 (1) sentence 1, Article 20 (1) and (2) in conjunction with Article 79 (3) GG.[115]

 

In plain terms, the argument goes as follows: The fundamental right to vote for the Bundestag is violated if the Bundestag loses or abandons its budgetary responsibility leading to a situation in which current or future compositions of the Bundestag do no longer have the possibility to make political decisions about the budget because the indebtedness of the German budget caused by a prior parliamentary decision does factually not allow for such decisions.[116] Furthermore, the political latitude as safeguarded through the core identity of the German Constitution (Article 20 (1) and (2,) Article 79 (3) GG would be violated if the Bundestag does not remain „the master of its decisions.“[117] Even in a system of intergovernmental administration such as in the EU the Bundestag must be able to keep control of substantial budgetary decisions.

 

b. The ‚Mechanism’ Argument

As a result of the Bundestag’s budgetary responsibility, the FCC further pointed out that the Bundestag „may not transfer its budgetary responsibility to other actors.“[118] In particular, the Bundestag may not agree to any „mechanisms with financial effect“ which may result in erratic financial burdens with budget relevance without prior parliamentary consent.[119]

According to the FCC, a violation of the Bundestag’s budgetary responsibility would occur if the type and amount of levies imposed on German citizens were supranationalised and the Bundestag deprived of its right of disposal.[120] For this reason, the FCC determined that “no permanent mechanisms may be created under international treaties which are tantamount to accepting liability for decisions by free will of other states, above all if they entail consequences which are hard to calculate.“[121] The FCC thereby established a constitutional threshold limiting the Bundestag’s capability to establish supranational financial mechanisms. 

The premise behind this ’mechanism’ argument is the concept of electoral democracy, as outlined above: If a permanent mechanism is created under an international treaty that relinquishes the Bundestag’s budgetary responsibility, the fundamental right to vote for the Bundestag would be violated. Also, the political latitude as safeguarded through the core identity of the constitution would be violated if the Bundestag does not remain „the master of its decisions.“[122]  

The constitutional premise about the violation of Article 38 (1) GG has been well known for years, as the Court has mainly used it to assess questions arising from the formal transfer of competences of the Bundestag to adopt the budget of the European Union. Yet, the ’mechanism’ argument is new in the sense that it is now even applied to cases without the formal transfer of budgetary competences to the EU.

c. Emphasis on StabMechG

Despite the fact that the FCC concluded that none of the challenged federal laws relinquishes the Bundestag’s budget autonomy, the Court corrected one provision of the StabMechG. The governing coalition of Christian Democrats (CDU/CSU) and Liberals (FDP) had modified the StabMechG bill in the Budget Committee in order to attenuate the opposition’s criticism. The FCC criticized one of these amendments, as it merely obliges the Federal Government to make efforts to involve the parliamentary Budget Committee before issuing guarantees.[123]

According to the Court, this provision would not safeguard the on-going influence of the Bundestag with regard to the issuance of new guarantees. Notably, such marginal participation rights would affect the Bundestag’s budget autonomy “in a manner which would adversely affect the right to vote”[124]. The FCC therefore claimed that „in order to avoid unconstitutionality”[125] this norm of the StabMechG has to be interpreted to the effect that the Federal Government is “obliged” (and does not only has to “make efforts”) to obtain the prior consent of the Budget Committee if new guarantees for the EFSF are issued.

8. Legal effects and & broader political implications of the judgment

The FCC rejected all three constitutional complaints as unfounded. Nevertheless, the Court determined that the Federal Government could only issue guarantees if they are approved by the Budget Committee of the Bundestag beforehand. As a result of the FCC ruling, the German parliament modified the participation rights of the Bundestag.

 

IV. FCC Preliminary Ruling from 27 October 2011

 

1. Name of the Court

 

Bundesverfassungsgericht/German Federal Constitutional Court (FCC)

 

2. Parties

 

Two MPs from the parliamentary group of the Social Democrats were the plaintiffs. The German Bundestag was the respondent.

 

3. Type of action/procedure

 

Application to issue an interim order in the framework of an Organstreit proceeding. An interim order is a measure of the FCC to interrupt the exercise of the attacked rules until there is a decision on the merits. The FCC can issue such an order if this is absolutely necessary to prevent severe disadvantages or imminent violence or another important reason of the same severity. Factually, such an interim measure is only issued in exceptional cases.

 

4. Admissibility & Arguments of the parties

 

The FCC decided that it is not excluded that the plaintiffs are infringed in one of their constitutional rights laid down in Article 38 (1) sentence 2 GG. This is why the complaint is admissible. The main reasoning behind the application of this norm had been laid down in the judgment of the Bundesverfassungsgericht from 7 September 2011 to which the Court referred.

 

5. Legally relevant factual situation

 

The decision to issue an interim order by the FCC was supported by seven judges, one judge did not vote in favour of this order.

 

6. Legal questions & Arguments of the parties

 

The arguments of the plaintiffs are the same as in the main proceedings (see FCC judgment from 28 February 2012 below).

 

Regarding the issuance of an interim order by the FCC, the plaintiffs substantiated their claim with the fact that it would be factually impossible to undo an approval of the EFSF-Committee, while preventing the EFSF-Committee of making such a decision for a limited period of time would only re-establish the situation which had existed before the enactment of the StabMechG.

 

7. Answer by the Court to the legal questions and legal reasoning of the Court

 

In general, for an interim order the FCC balances the consequences of such an order with the consequences which would arise if this order would not be issued. In the case of the EFSF-Committee the FCC decided that the constitutional rights of the MPs could be infringed irreversibly if the Court does not issue the interim order. If the EFSF-Committee should grant its approval to an EFSF-measure Germany would be bound to it by international public law which could not be repealed by a decision of the FCC in the main proceedings. Furthermore, the German Bundestag would not be incapable of action if the interim order would be issued because the Budget Committee could decide about EFSF-measures. This is why the Court issued the interim order.

 

8. Legal effects and & broader political implications of the judgment

None.

 

 

V. FCC Judgment from 28 February 2012

 

1. Name of the Court

 

Bundesverfassungsgericht/German Federal Constitutional Court (FCC)

 

2. Parties

 

Two MPs from the parliamentary group of the Social Democrats initiated the court proceedings between governmental bodies (Organstreit proceedings) against the Bundestag. The Federal Government joined the party German Bundestag.

 

3. Type of action/procedure

 

Organstreit proceedings. This procedure is the main proceedings of the interim proceedings from 27 October 2011.

 

4. Admissibility & Arguments of the parties

 

In the reasons for the decision, the FCC briefly stated that the complaints are admissible because the two plaintiffs can invoke their own rights as MPs of the Bundestag (Article 38 para. 1 sentence 2 GG). Two regulations of the StabMechG may infringe their rights: First, in case of a particular urgency or confidentiality the parliamentary responsibility for the budget is transferred to a special committee, consisting of nine MPs (§ 3 (3) StabMechG), so-called Committee of Nine. Second, the Federal Government only has to report to this special committee (§ 5 (7) StabMechG).

 

5. Legally relevant factual situation

 

None.

 

6. Legal questions & Arguments of the parties

 

The plaintiffs referred to their constitutional rights as MPs as stated in Article 38 (1) sentence 2 GG. They argued that their right to participate in parliamentary decisions in matters concerning the Federal budget is one of the most important rights of MPs. The justifications for the Committee of Nine (urgency and confidentiality) are not convincing because the Bundestag already has a regulation for confidential decisions and it is possible to invite all MPs or at least the MPs who are members of the Budget Committee for EFSF-decisions. In addition, the StabMechG does not reflect the fundamental principle that Committees must reproduce the majority constellations in the plenary composition of the Bundestag (principle of “Spiegelbildlichkeit”) because MPs who do not belong to one of the parliamentary groups have no possibility to become a member of the EFSF-Committee. Furthermore, the rules about the EFSF-Committee are too vague which – from their point of view – is a violation of the principle of democracy. Moreover, the EFSF-Committee can decide with only five members being present which is also a violation of democratic principles. The StabMechG also contains the regulation that this Committee must decide in cases of emergency measures which include so many cases that the EFSF-Committee would be competent in general and not only – as planned – in exceptional cases. According to the StabMechG the Federal Government has the right to invoke urgency or confidentiality and there is no minority right to vote against this opinion of the government. Finally, they argued that all MPs must be informed subsequently about EFSF-measures in order to be able to control the Committee of Nine. Such an obligation is not provided for in the StabMechG.

 

The German Bundestag as the respondent rejected all arguments. The Bundestag highlighted that there is a parliamentary right to decide about every single EFSF-decision which could also have been in the sole competence of the Federal Government without a parliamentary approval. Installing the EFSF-Committee was necessary to guarantee the budget responsibility of the Bundestag in an intergovernmental system. The regulation respects the parliamentary legitimacy and its representativeness. From the point of view of the Bundestag, the restriction of rights of MPs in this case is justified by objective reasons of paramount importance. The Bundestag argued that the specific needs in EFSF-decisions make it necessary to install such a Committee because it is best suited to decide in cases of urgency or confidentiality. Furthermore, the Bundestag presented the argument that the competences of the EFSF-Committee are limited to the necessary degree. Moreover, there is no constitutional requirement that parliamentary minorities must have the right to vote against governmental decisions. It is only necessary to guarantee their participation in the process which is respected in the StabMechG.

 

The Federal Government declared its intervention in the Organstreit proceedings and has, therefore, the right to present its opinion in front of the FCC. In its pleading the Federal Government argued that it is essential to be able to react quickly on developments at the finanacial markets. This is why the number of members of the EFSF-Committee must be limited. It is the functionality of the Bundestag which justifies these provisions on the constitutional level and the openness of the Basic Law to international and European law. In addition, the principle of separation of powers would demand that the government must be able to act in fields such as foreign policy. From heir point of view, the EFSF-Committee does not have less democratic legitimacy than the Budget Committee because its members are also elected by the Bundestag as a plenary.

 

7. Answer by the Court to the legal questions and legal reasoning of the Court

 

The FCC had to decide on two legal questions. First, is a law which transfers budgetary competences of the parliament as a whole to a special committee of nine MPs in case of urgency or confidentiality in accordance with the German constitution? Second, is a law which limits the duty to report of the Federal government to the special committee in accordance with the German constitution?

 

a) The constitutionality of the Committee of Nine

The FCC highlighted the rights of the MPs of the Bundestag, e. g. the right to vote, the right to speak or the right to pose questions. Their parliamentary role is of particular importance in questions of the budget which belongs to the fundamental principles of a constitutional state to democratically shape itself. According to Article 110 (2) GG, it is only within the competence of the legislator to decide about the budget. Article 114 GG obliges the parliament to control how and whether the government executes the budget plan. Because of the high relevance of the budget for political decisions the German parliament has to remain in a position in which its budgetary decisions still have an effect. It is not in line with the German Constitution to transfer this competence – even if supported by a majority of the MPs – to another institution. Moreover, every MP has the right to criticize the budget plan and to control public spending. This is part of the freedom and equality of the mandate as a member of the Bundestag.

 

However, the Bundesverfassungsgericht emphasized that these rights can be limited by a legal reason of constitutional status. One of these reasons is the parliament’s capability of functioning. Article 40 (1) sentence 1 GG gives the Bundestag the right to adopt rules of procedure in order to make sure that the parliament can effectively fulfil its role and tasks. However, the competence for self-organisation of the Bundestag has to take into account the principle of proportionality. It is not constitutionally excluded that the Bundestag establishes committees which do not consist of all MPs. Though, transferring fundamental competences of the Bundestag as a plenary to a committee needs a higher justification than transferring less important competences. The Bundesverfassungsgericht made it clear that it is important to respect two basic rules in this regard:

  1. The majority rules in the Bundestag as a plenary must be reproduced in the committee (principle of “Spiegelbildlichkeit”);
  2. The possibilities to be informed for the MPs who are not members of the Committee cannot be restricted beyond the indispensable necessary degree.

 

§ 3 (3) StabMechG transferred the competence to decide about certain measures in the framework of the EFSF to the Committee in case of urgency and confidentiality. Both justifications are linked with the justification that the Bundestag has to remain its functionality. However, the FCC was not convinced that it is necessary to have a very small Committee in EFSF-matters justified because of urgency. All EFSF-decisions allow for enough time to invite a bigger group of MPs, for example the Committee for Budget Affairs (41 MPs).

 

The justification of confidentiality was only accepted by the Bundesverfassungsgericht because of one reason: The planning of purchases of government securities by the EFSF. In this case, the decision and even the fact that such a decision is discussed must be kept secretly if the success of the measure shall not be endangered. All other reasons of the StabMechG were not decisions which make it necessary to install such a small Committee because the Bundestag already has sufficient rules for confidential decisions.

 

The principle of Spiegelbildlichkeit is not explicitly contained in the StabMechG but the law must be interpreted in this way ruled the Bundesverfassungsgericht. This is why the norm itself was not unconstitutional but when applying it, meaning when voting for the MPs of the Committee of Nine, the Bundestag has to respect this principle.

 

b) The duty to report of the Federal Government

The FCC used the same argument in relation to the rights of MPs to be informed about EFSF-measures. The government is only allowed to withhold information as long as the status of urgency is still existing. When the reasons for urgency are no longer persisting, the government has to inform all MPs immediately. This is an essential rule so that the Bundestag is able to control the Committee of Nine.

 

8. Legal effects and & broader political implications of the judgment

 

Subsequently to the judgment, the StabMechG was amended within the meaning of the FCC judgment.

 

Implementation
IV.6    
What is the role of Parliament in the application of the EFSF, for example with regard to decisions on aid packages (Loan Facility Agreement and Memorandum of Understanding) and the disbursement of tranches, both of which need unanimous approval by the so-called Guarantors, i.e. the Eurozone member states?

The role of the Bundestag in EFSF decisions is established in the StabMechG. Question IV.4 specifies the relevant provisions and controversies in more detail.

 

Implementing problems  
IV.7
What political/legal difficulties
did Germany encounter in the application of the EFSF?

No political/legal difficulties in the application of the EFSF in Germany are known.

 

Bilateral support      
IV.8    
In case Germany participated in providing funding on a bilateral basis to other EU Member States during the crisis, what relevant Parliamentary debates or legal issues have arisen?

Germany did not participate in bilateral funding other than the first aid package for Greece of 2010.

Miscellaneous
IV.9    
What other information is relevant with regard to Germany and the EFSM/EFSF?

No further relevant information.

 

[1] See the consolidated version: http://www.bundestag.de/blob/192554/08516a1e200e1e75a44ba3e724a8487b/stabmechg_en_2012_consolidated-data.pdf

[2] See Deutscher Bundestag. Gesetzesentwurf der Fraktionen der CDU/CSU und FDP. Entwurf eines Gesetzes zur Übernahme von Gewährleistungen im Rahmen eines europäischen Stabilisierungsmechanismus. Drucksache 17/1685, p.4

[3] Bundestag, printed matter No. 17/1685, http://dipbt.bundestag.de/dip21/btd/17/016/1701685.pdf

[4] Bundestag, plenary records No. 17/44, 21 May 2010, p. 4443-4445, http://dip21.bundestag.de/dip21/btp/17/17044.pdf.

[5] Bundesrat, printed matter No. 298/10 and plenary records No. 870, 21 May 2010, http://www.bundesrat.de/SharedDocs/downloads/DE/plenarprotokolle/2010/Plenarprotokoll-870.pdf?__blob=publicationFile&v=3

[6] German Federal Law Gazette 2011, part I, No. 51, p. 1992, http://www.bgbl.de/xaver/bgbl/stArticlexav?startbk=Bundesanzeiger_BGBl&jumpTo=bgbl111s1992.pdf

[7] Bundestag, plenary records No. 17/130, 29 September 2011, p. 15236-15239, http://dipbt.bundestag.de/dip21/btp/17/17130.pdf#P.15204

[8] German Federal Law Gazette 2012, part I, No. 23, p. 1166, http://www.bgbl.de/xaver/bgbl/stArticlexav?startbk=Bundesanzeiger_BGBl&jumpTo=bgbl112s1166.pdf

[9] Bundestag, stenographi report of the 176th session, 27 April 2012, p. 20934.

[10] The voting result can be seen on http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=327

[11] The voting result can be seen on http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=124&url=/apps/na/na/fraktion.form&controller=fraktion

[12] The voting result can be seen on http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=219&url=/apps/na/na/fraktion.form&controller=fraktion; a further extension for Portugal was approved, see http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=222&url=/apps/na/na/fraktion.form&controller=fraktion

[13] The voting result can be seen on http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=221&url=/apps/na/na/fraktion.form&controller=fraktion

[14] The voting result can be seen on http://bundestag.de/bundestag/plenum/abstimmung/grafik?id=327

[15] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p.4.

[16] Bundestag, printed matter No. 17/2569, p. 2 et seq., http://dipbt.bundestag.de/dip21/btd/17/025/1702569.pdf

[17] Bundestag, printed matter No. 17/7130, p. 5, http://dipbt.bundestag.de/dip21/btd/17/071/1707130.pdf

[18] Bundestag, printed matter No. 17/7130, p. 6, http://dipbt.bundestag.de/dip21/btd/17/071/1707130.pdf

[19] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, Online available at http://dipbt.bundestag.de/dip21/btp/17/17044.pdf#P.4412,15227 A.

[20] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, 15219 D.

[21] Council Regulations automatically take effect in the member states. Council Regulation No 407/2010 of May, 11, 2010.

[22] See Deutscher Bundestag, ‘Initiation of Legislation. Online available at: http://www.bundestag.de/htdocs_e/bundestag/function/legislation/legislat/02initleg.html.

[23] See Deutscher Bundestag, ‘The legislation of the Federation’. Online available at: http://www.bundestag.de/htdocs_e/bundestag/function/legislation/legislat/index.html.

[24] See Deutscher Bundestag, ‘The legislation of the Federation’. Online available at: http://www.bundestag.de/htdocs_e/bundestag/function/legislation/legislat/index.html.

[25] See Deutscher Bundestag, ‘The first reading’. Online available at: http://www.bundestag.de/htdocs_e/bundestag/function/legislation/legislat/07firstrdg.html.

[26] See Deutscher Bundestag, ‘The committee stage’. Online available at: http://www.bundestag.de/htdocs_e/bundestag/function/legislation/legislat/08comstage.html.

[27] The German title of the law is: ‘Gesetz zur Übernahme von Gewährleistungen im Rahmen eines europäischen Stabilitätsmechanismus’

[28] These are the dates when the respective German bills officially took effect.

[29] http://www.bpb.de/nachschlagen/lexika/handwoerterbuch-politisches-system/40362/regierungserklaerung?p=all

[30] Schuler Katharina, ‘Merkel will weiter anecken’, in: Zeit Online, 19.05.2010. Online available at: http://www.zeit.de/politik/deutschland/2010-05/merkel-eu-regierungserklaerung.

[31] Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p.4126.

[32] Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p.4126.

[33] Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p.4128.

[34] Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p.4128.

[35] In this report, the German description of the political parties in the Bundestag will be used. The acronyms stand for the subsequent meaning. CDU (Christian Democratic Union); CSU (Christian Social Union); SPD (Social Democratic Party of Germany); FDP (Free Democratic Party), DIE LINKE (The Left Party), BÜNDNIS 90/THE GREENS (Alliance 90/the Greens). 

[36] See Deutscher Bundestag. Haushaltsauschuss, Protokoll Nr. 17/21, 21. Sitzung, 19.Mai 2010. The expert hearing comprised people from academia, the banking sector and think tanks. The following people were present: Dr. Heiner Flassbeck (UNCTAD Director of the Division on Globalization ad development Strategies), Prof. Dr. Clemens Fuest (Said Business School, Oxford University), Prof. Dr. Ulrich Häde (Europa-University Viadrina Frankfurt (Oder)), Jochen Sanio (President Bundesanstalt für Finanzdienstleistungsaufsicht), Dr. Daniela Schwarzer (Leiterin der Forschungsgruppe EU-Integration, SWP), Prof. Dr. Axel A. Weber (Präsident der Deutschen Bundesbank).

[37] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p.3; see also Deutscher Bundestag. Haushaltsauschuss, Protokoll Nr. 17/21, 21. Sitzung, 19.Mai 2010, pp.9-10.

[38] See Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p.4133.

[39] Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p.5.

[40] See for instance Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p. 5-6.

[41] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p. 4.

[42] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p. 4.

[43] See Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p. 4146.

[44] Except the party DIE LINKEN, the amendment was agreed upon by all parliamentary groups in the Budget Committee (including BÜNDNIS 90/DIE GRÜNEB and the SPD). However, the whole bill with the connected amendments was only recommended to the Bundestag with the votes of CDU/CSU and FDP: BÜNDNIS 90/DIE GRÜNEN and SPD abstained in the recommendation to the Bundestag. For details of this voting procedures see Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p. 6.

[45] See Kranen, Dirk Heiner/Löhr, Sebastian, 2011: Beteiligungsrechte des Bundestages und des Bundesrates bei Maßnahmen der EFSF, in: Wirtschaftsdienst 11, p. 759.

[46] See Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p. 4145.

[47] See Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p. 4131.

[48] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p.5, See also Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, pp. 4416 C.

[49] See Deutscher Bundestag. Bericht des Haushaltsausschusses (8. Ausschuss) zu dem Gesetzentwurf der Fraktionen CDU/CSU und FDP – Drucksache 17/1685 -. Drucksache 17/1741, p. 5.

[50] See Deutscher Bundestag, Plenarprotokoll 17/42, 42. Sitzung, 19.Mai 2010, p. 4142.

[51] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, pp. 4443-4445.

[52] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, pp. 4416D-4417A.

[53] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, p. 4423B.

[54] See Deutscher Bundestag. Plenarprotokoll 17/44, 44. Sitzung, 21. Mai 2010, p. 4422C.

[55] The German title of this resolution is: ‚Parlamentsrechte im Rahmen zukünftiger europäischer Stabilisierungsmaßnahmen sichern und stärken’.

[56] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011. Online available at http://dipbt.bundestag.de/dip21/btp/17/17124.pdf#P.14551,14552 B.

[57] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 15205 B.

[58] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14552 B.

[59] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14562 C.

[60] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14554 C.

[61] A chancellor majority has been reached when a law can be adopted in the Bundestag solely with the votes of the governmental parties (in this case CDU/CSU and FDP) and without the votes of the opposition parties. 

[63] See http://wobo.de/news/schuldenunion-waere-weg-in-die-krise.

[64] See http://wobo.de/news/schuldenunion-waere-weg-in-die-krise.

[65] See https://www.tagesschau.de/wirtschaft/efsf122.html.

[66] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 15208D.

[67] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14554 D.

[68] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011. Online available at http://dipbt.bundestag.de/dip21/btp/17/17130.pdf#P.15204, 15207 D.

[69] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011, 15207 D.

[70] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011, 15227 A.

[71] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011, 15219 D.

[72] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14556 B.

[73] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011, 15206.

[74] Deutscher Bundestag. Plenarprotokoll 17/124, 124. Sitzung, 8. September 2011, 14566 C.

[75] Deutscher Bundestag. Plenarprotokoll 17/130, 130.Sitzung, 29. September 2011,15215 B.

[76] See Law of October 13, 2011, Bundesgesetzblatt Teil I, 2011 Nr. 51, 13.10.2011, p. 1992. Online available at http://www.bgbl.de/Xaver/stArticlexav?startbk=Bundesanzeiger_BGBl#__Bundesanzeiger_BGBl__%2F%2F*%5B%40attr_id%3D'bgbl111s1992.pdf'%5D__1371479981676.

[77] See Law of October 13, 2011, Bundesgesetzblatt Teil I, 2011 Nr. 51, 13.10.2011, p. 1992.

[78] See Law of October 13, 2011, Bundesgesetzblatt Teil I, 2011 Nr. 51, 13.10.2011, p. 1992.

[79] See Law of October 13, 2011, Bundesgesetzblatt Teil I, 2011 Nr. 51, 13.10.2011, p. 1992.

[80] See Law of October 13, 2011, Bundesgesetzblatt Teil I, 2011 Nr. 51, 13.10.2011, p. 1992.

[81] See Deutscher Bundestag, printed matter No. 17/9145, 27 March 2012, p. 1, http://dipbt.bundestag.de/dip21/btd/17/091/1709145.pdf

[82] See Deutscher Bundestag, printed matter No. 17/9145, 27 March 2012, p. 5, http://dipbt.bundestag.de/dip21/btd/17/091/1709145.pdf

[83] See Deutscher Bundestag, printed matter No. 17/9435, 25 April 2012, p. 5, http://dipbt.bundestag.de/dip21/btd/17/094/1709435.pdf

[84] See Deutscher Bundestag, plenary protocal 17/176, 27 April 2012, p. 20927, http://dip21.bundestag.de/dip21/btp/17/17176.pdf

[85] See Deutscher Bundestag, printed matter No. 17/9435, 25 April 2012, p. 6, http://dipbt.bundestag.de/dip21/btd/17/094/1709435.pdf

[86] See Deutscher Bundestag, plenary protocal 17/176, 27 April 2012, p. 20931, http://dip21.bundestag.de/dip21/btp/17/17176.pdf

[87] See Deutscher Bundestag, plenary protocal 17/176, 27 April 2012, p. 20933-20934, http://dip21.bundestag.de/dip21/btp/17/17176.pdf

[88] See Deutscher Bundestag, printed matter No. 17/9435, 25 April 2012, p. 5, http://dipbt.bundestag.de/dip21/btd/17/094/1709435.pdf

[89] See Deutscher Bundestag, plenary protocal 17/176, 27 April 2012, p. 20930, http://dip21.bundestag.de/dip21/btp/17/17176.pdf

[90] See Deutscher Bundestag, plenary protocal 17/176, 27 April 2012, p. 20934, http://dip21.bundestag.de/dip21/btp/17/17176.pdf

[91] According to Article 79, para. 3 it is inadmissible to change the fundeamnetal rights laied out in Article1-19 of the GG through an amendment of the GG (this is the so-called „Ewigkeitsklausel“).

[92] Judgment from 16 june 2015, Case C-62/14, ECLI:EU:C:2015:400 – Gauweiler.

[93] See Schneider, Karsten, 2013: Yes, but…One More Thing: Karlsruhe’s Ruling on the European Stability Mechanism, in: German Law Journal 14(1), p. 56. Also Von Ungern-Sternberg, ‘Parliaments: Fig Leaf or Heartbeat of Democracy?’, European Constitutional Law Review (2012) 204-322

[94] See Frankfurter Allgemeine Zeitung, ‘Bundesverfassungsgericht billigt EU-Rettungsschirm’, 07.11.2011. Online available at: http://www.faz.net/aktuell/wirtschaft/wirtschaftspolitik/beschwerde-zurueckgewiesen-bundesverfassungsgericht-billigt-eu-rettungsschirm-11133178.html

[95] See Bundesverfassungsgericht [BVerfG – Federal Constitutional Court], 2 BvR 1877/97, 2 BvR 50/98, 31. März 1998.

[96] See Süddeutsche Zeitung, ’Karlsruhe lehnt Eilantrag ab’, 10.10.2010. Online available at: http://www.sueddeutsche.de/politik/euro-rettungspaket-karlsruhe-lehnt-eilantrag-ab-1.957050.

[97] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 1 BvR 1099/10, June, 6, 2010, para. 33.

[98] The plaintiffs had claimed several violations of Article38 GG, yet the FCC only accepted the argument about the violation of the Bundestag’s budgetary authority. The plaintiffs had, e.g., claimed that Article38, para.1 GG grants the right that every instance of European integration policy has to be specifically supported by the Bundestag and teh Bundesrat; for more arguments see Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 33, 34, 43-51.

[99] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 93.

[100] In German the law is called: ‘Gesetz zur Übernahme von Gewährleistungen zum Erhalt der fpr die Finanzstabilität in der Währungsunion erforderlichen Zahlungsfähigkeit der Hellenischen Republik’.

[101] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 110.

[102] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 37.

[103] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 37, 54.

[104] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 112.

[105] For an enumeration of the rest of the EU legislative decision that were part of the constitutional complaint see Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para.116.

[106] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para.114.

[107] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 116.

[108] For more details on the point see Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 117-118.

[109] According to one plaintiff this violation cannot be justified through reference to the state of emergency in Article122.2 TFEU, as “the overindebtnedness of Greece and other states is not an event comparable to a natural disaster.” Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 41, 40.

[110] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 129.

[111] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 33.

[112] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 36.

[113] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 133.

[114] See Schneider, 2013: Yes, but…One More Thing: Karlsruhe’s Ruling on the European Stability Mechanism, p.56.

[115] The argument is understood as a protection of the right to vote (Article38 (1) GG), including the preservation of the principle of democracy (Article 20 (1) and (2) GG) and guaranteed in Article 79 (3) GG as part of the unchangeable identity of the constitution.

[116] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 121.

[117] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 127.

[118] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 125.

[119] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 125.

[120] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 127.

[121] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 128

[122] Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 127.

[123] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 141.

[124] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 141.

[125] See Bundesverfassungsgericht [BVerfG –Federal Constitutional Court], 2BvR 987/10, 2BvR 1485/10, 2BvR 1099/10, September 7, 2011, para. 141.