18.03.14

Top German Court Clears Euro-Zone Bailout Fund

Final Legal Challenge to Permanent Bailout Mechanism Is Dismissed

Germany's highest court Tuesday dismissed the last legal challenge to the euro zone's permanent bailout mechanism, saying it didn't infringe on the German parliament's fiscal powers. ... The court said parliament may authorize a future capital increase as long as such a decision was transparent, could be reversed by future political majorities and didn't involve any open-ended financial commitments from Germany. Bert Van Roosebeke, financial market regulation expert with Freiburg-based think tank Center for European Policy, said the court had set a high hurdle for Germany to pull out of a future capital increase. For this to happen, he said, "the constitutional court would need to see an impairment of the parliament's budget autonomy to a very, very large extent." ...read more