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W&L Law Professor Assesses German Court Decision

The much-anticipated ruling by the German Constitutional Court on whether Germany’s ratification of the financial recovery plan known as the European Stability Mechanism (ESM) was predictable on two levels, according to Russell Miller, professor of law at Washington and Lee University and co-author of a new book about German constitutional law and co-founder of the German Law Journal.

Ruling on a request for a temporary injunction against Germany’s participation in the European bailout on Wednesday, the court determined that ESM was not in conflict with German law.

“Despite the reputation that the court in Karlsruhe has for operating as a brake on European integration, Europe consistently wins in the court,” said Miller. “As a consequence, the ESM will take effect, to the great relief of the markets.”


Though it was, in Miller’s view, predictable that the ESM would survive, it was equally predictable that the court would use the occasion to reaffirm German constitutional limitations on future participation.

Miller said that those limitations draw largely from a decision that the court issued a year ago in a case involving provisional measures to rescue Greece.

“The analysis in that case was reasserted today, namely the court’s insistence that, as a matter of national sovereignty, the German parliament has to retain its final and exclusive authority over budgetary matters,” Miller said. “That was implicated by the case because it’s possible to read the European Stability Mechanism treaty as calling upon Germany to make a range of commitments now but the language does not necessarily cap Germany’s contributions. There was a risk that ESM could create demands on the budget that would strip the Germany parliament of its authority over the budget.”

The court, Miller said, made clear that that the German parliament gets to choose the extent of Germany’s commitment to this kind of permanent rescue fund.

Read Miller’s commentary and comments in the news media on this issue:

Commentary (ConstitutionMaking.org)

Los Angeles Times


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