Both cases were started by a number of Cypriot account holders that suffered losses from the bank restructuring that followed from the Cypriot request for financial assistance from the ESM.
In the Ledra Advertising case, the Grand Chamber of the Court established that the Commission and ECB can be liable for their actions under the ESM. That fact that they may play a certain role within the ESM framework does not alter the nature of the acts of the ESM, which fall outside the EU legal order. This however cannot prevent unlawful conduct linked to the adoption of a memorandum of understanding on behalf of the ESM from being raised against the Commission and the ECB in an action for compensation, the Court importantly concluded. The Commission in particular ‘shall promote the general interest of the Union’ and ‘shall oversee the application of Union law’ (article 17 TEU).
In reviewing whether the Commission's conduct in this specific case was unlawful, the Court decided that EU institutions are bound by the EU Charter of Fundamental Rights also when they act outside the EU legal framework. It therefore examined whether the Commission contributed to a sufficiently serious breach of the appellants’ right to property, within the meaning of Article 17(1) of the Charter. It concluded however that there was not such breach as the measures cannot be regarded as unjustified restrictions on that right: "In view of the objective of ensuring the stability of the banking system in the euro area, and having regard to the imminent risk of financial losses to which depositors with the two banks concerned would have been exposed if the latter had failed, such measures do not constitute a disproportionate and intolerable interference impairing the very substance of the appellants’ right to property." (para 74)
In the Mallis case, the Grand Chamber of the Court confirmed the earlier General Court's conclusion that the Eurogroup statement of 25 March 2013, in which it indicated that it had reached an agreement with the Cypriot authorities on the key elements of a future macro-economic adjustment programme and welcomed the plans for the restructuring of the financial sector that were mentioned in the annex to that statement, cannot be attributed to either the Commission or the ECB: "the fact that the Commission and the ECB participate in the meetings of the Eurogroup does not alter the nature of the latter’s statements and cannot result in the statement at issue being considered to be the expression of a decision-making power of those two EU institutions". (para 57)