EU Says Its Law Trumps German Court Ruling

The EU insisted European law trumps that of member states on Tuesday, after a ruling by Germany's top court called into question stimulus measures planned by the European Central Bank.

The German ruling came with particularly harsh criticsm of the EU's highest court, which the judges on Germany's Constitutional Court said had rubber-stamped ECB policy with sloppy argumentation.

Analysts warned that the ECB-led recovery plan for the 19-member eurozone could come under threat if German and EU judges battle it out in the midst of the coronavirus pandemic.

"Notwithstanding the analysis of the decision of the German constitutional court today, we reaffirm the primacy of EU law," said Eric Mamer, spokesman for the European Commission, the bloc's executive.

He spoke after the German court gave the ECB three months to clarify a key element of the ECB's support to the eurozone but stopped short – for now – of overturning its debt crisis-era "quantitative easing" (QE) bond-buying scheme altogether.

The court ruled that Germany's central bank would be barred from participating in QE beginning this summer unless the ECB "demonstrates in a comprehensible and substantiated manner" that its policies are legal, the ruling said.

Observers were especially surprised by the court's unprecedented challenge to the EU's top court; a legal affront that for some recalled a stance more typical of eurosceptic countries such as Poland, Hungary or departed Britain.

Law professor Franz Mayer of Bielefeld University warned that the ruling was legally "catastrophic" and could open a Pandora's box.

The commission's Mamer underlined that EU law – agreed to and ratified by member states – means that "the rulings of the European Court of justice are binding on all national courts".

The European Commission is the bloc's vast executive arm, but is also tasked with defending EU law against national policies and court rulings.

It also has the power to send national governments to the EU court and calls came in fast on Tuesday for Brussels to take this step with Germany.

"Europe cannot work if national constitutional courts decide unilaterally when the EU court in Luxembourg has primacy. Expect Hungary's and Poland's constitutional court to follow this precedent," said Spanish MEP Luis Garicano, a centrist.

The effects on the eurozone economy were also a burning question after the decision.

The ECB has led the way to save Europe from the devastating shock of the coronavirus outbreak, with national governments largely looking after their own.

The ECB's bond-buying programme criticised in the German court ruling is credited with having put an end to the eurozone debt crisis.

But some observers are concerned that the court decision will be used in Germany to discredit another bond-buying spree by the ECB designed to shield Italy, Spain and others from economic devastation caused by the coronavirus crisis. (AFP)