BRUSSELS – The European Commission is unlikely to immediately take legal action against Germany over the decision of the country’s high court that the European Central Bank has exceeded its mandate by purchasing bonds, European Union officials said on Monday.
Ursula von der Leyen, executive president of the European Union, raised the possibility of a lawsuit on Sunday over a constitutional court ruling last week that gave the ECB three months to justify the purchase of bonds under its flagship eurozone stimulus program or losing the Bundesbank as a participant.
But EU officials said the Commission, which said that EU law took precedence over national regulations, needed time to consider the reasons for any legal action and fear it would undermine the independence of Germany’s constitutional court.
“We touched on the decision of the national court and the highest court in Germany. So this raises questions about the independence of the judiciary. So we must be very careful in considering whether to launch violation procedures or not,” officials said.
Violations are legal cases that the Commission can bring before the European Union Judiciary Court (CJEU) if the Brussels-based executive considers member countries to violate European Union law. The court can order a country to make amends, or face substantial fines.
Bringing Germany to CJEU, the European Union’s highest court, will not overturn a German court decision, EU officials said.
“This final decision (the German constitutional court) cannot be changed. So the question is, if we launch the violation procedure, what will happen,” said one European Union official.
Launching legal action does not mean a case ends in court, officials say.
But opening up the legal process will lead to “an important element of dialogue between the Commission and the member states concerned about what must be done,” one of them said.
The timing of any legal action will also depend on whether the European Commission decides to focus solely on the decision of the German constitutional court or to start proceedings with the Bundesbank or the German government, EU officials say.
The Constitutional Court ruling was a blow to the unprecedented 2 trillion euro purchase scheme that kept the eurozone intact after its debt crisis, but which critics say has flooded the market with cheap money and encouraged excessive spending by some governments.
(Editing by Timothy Heritage)
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