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FDP complaint failed: Steinmeier can sign ESM reform law

FDP complaint failed
Steinmeier can sign ESM reform law

Even during the grand coalition, the Bundestag approved the reform of the ESM euro rescue fund. Several FDP MPs believe the changes would change the constitution. Therefore, a two-thirds majority should also be necessary. However, your complaint in Karlsruhe was unsuccessful.

A year and a half after the votes in the Bundestag and Bundesrat, Federal President Frank-Walter Steinmeier can examine and, if necessary, sign a law to amend the ESM euro rescue fund. According to information on Friday, the Federal Constitutional Court rejected a complaint by seven FDP members of the Bundestag as inadmissible. At the request of the highest German court, Steinmeier suspended the examination in the summer of 2021. His signature is necessary for a federal law to come into force.

The court in Karlsruhe explained that the plaintiffs had not sufficiently explained why their rights should have been violated. Nor did they explain why the changes would transfer sovereign powers to the ESM or the European Union. In any case, a purely factual change does not usually represent such a transfer of sovereign rights.

The ESM is a fund from which countries with the euro as their currency can obtain loans in the event of a crisis in order to ensure their solvency. It started in 2012 and provided Greece with money during the euro crisis – in return for reforms. On the one hand, the reform of the ESM is intended to facilitate precautionary credit lines for states in economic and financial crises. At the same time, the institution in Luxembourg is to assume the task of reinsurance for bank processing. This joint “backstop” is intended to strengthen Europe’s banking system and protect it from financial crises.

In 2020, the euro states had agreed on the reform of the ESM treaty, but the corresponding treaty still had to be ratified by the national parliaments of the 19 members. That still hasn’t happened in Italy. And the new euro member Croatia, which will introduce the common currency from 2023, still has to ratify the contract. Only then can the reform come into force.

The FDP MPs sued as private individuals in consultation with the parliamentary group. In their opinion, the approval law should have been passed with a two-thirds majority, as is also necessary for amendments to the Basic Law. The ESM reform has constitutional quality. That was ignored. In fact, the Bundesrat and Bundestag only approved the law with a simple majority. The plaintiffs had stated that they did not fundamentally question the ESM, but rather that they saw their rights violated.

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