Significance of ECJ decision in Thomas Pringle case

Even before today’s adverse judgement of the European Court of Justice concerning the legality of the European Stability Mechanism Treaty under EU law, this country had already paid over €500 million euro in October as a first instalment of Ireland’s legal obligation under the Treaty to ‘irreversibly and unconditionally’ contribute €11 billion in various forms of capital to the ESM Fund. Now further payments will be required.
The judgement does not bode well for the future integrity of EU treaties, the Commission and the institutional framework of the 27-member EU that has been built up over the years and which the ECJ is supposed to exist to uphold. The set-up that the ECJ has apparently endorsed will inevitably move the 17 member states that use the euro down a different legal- political path than the rest of the EU.
In his dissenting judgement in the Supreme Court, Judge Hardiman said that the ESM has introduced a new point of reference for the exercise of Irish government power in addition to the ‘common good of the people of Ireland’ and ‘the aims of the EU’. The new point of reference is the interest of ‘the euro area as a whole or of its Member States’. The other side of that equation is that the interests of members of the euro zone – especially the smaller ones – are completely submerged under the interests of the euro zone.
For example, there is no fixed commitment by the ESM to support Ireland should its assistance be required. The judgement is brutally frank: ‘stability support may be granted to ESM Members which are experiencing or are threatened by severe financing problems only when such support is indispensable to safeguard the financial stability of the euro area as a whole and of its Member States and the grant of that support is subject to strict conditionality appropriate to the financial assistance instrument chosen’ (Para 142).
In addition such assistance, ‘in no way implies that the ESM will assume the debts of the recipient Member State. On the contrary, such assistance amounts to the creation of a new debt, owed to the ESM by that recipient Member State, which remains responsible for its commitments to its creditors in respect of its existing debts’ and any financial assistance granted must be repaid and ‘the amount to be repaid is to include an appropriate margin’ (Para 139).
Although 27 judges heard Deputy Pringle’s application, only one judgement was delivered and we do not know if there were any dissenting judgements. Nevertheless, we owe Deputy Pringle a debt of gratitude for his courageous and public spirited action in undertaking this case. History will show how important it has been in re-asserting principles of democracy accountability and the rule of law.

 

Significance of ECJ decision in Thomas Pringle case

Even before today’s adverse judgement of the European Court of Justice concerning the legality of the European Stability Mechanism Treaty under EU law, this country had already paid over €500 million euro in October as a first instalment of Ireland’s legal obligation under the Treaty to ‘irreversibly and unconditionally’ contribute €11 billion in various forms of capital to the ESM Fund. Now further payments will be required.
The judgement does not bode well for the future integrity of EU treaties, the Commission and the institutional framework of the 27-member EU that has been built up over the years and which the ECJ is supposed to exist to uphold. The set-up that the ECJ has apparently endorsed will inevitably move the 17 member states that use the euro down a different legal- political path than the rest of the EU.
In his dissenting judgement in the Supreme Court, Judge Hardiman said that the ESM has introduced a new point of reference for the exercise of Irish government power in addition to the ‘common good of the people of Ireland’ and ‘the aims of the EU’. The new point of reference is the interest of ‘the euro area as a whole or of its Member States’. The other side of that equation is that the interests of members of the euro zone – especially the smaller ones – are completely submerged under the interests of the euro zone.
For example, there is no fixed commitment by the ESM to support Ireland should its assistance be required. The judgement is brutally frank: ‘stability support may be granted to ESM Members which are experiencing or are threatened by severe financing problems only when such support is indispensable to safeguard the financial stability of the euro area as a whole and of its Member States and the grant of that support is subject to strict conditionality appropriate to the financial assistance instrument chosen’ (Para 142).
In addition such assistance, ‘in no way implies that the ESM will assume the debts of the recipient Member State. On the contrary, such assistance amounts to the creation of a new debt, owed to the ESM by that recipient Member State, which remains responsible for its commitments to its creditors in respect of its existing debts’ and any financial assistance granted must be repaid and ‘the amount to be repaid is to include an appropriate margin’ (Para 139).
Although 27 judges heard Deputy Pringle’s application, only one judgement was delivered and we do not know if there were any dissenting judgements. Nevertheless, we owe Deputy Pringle a debt of gratitude for his courageous and public spirited action in undertaking this case. History will show how important it has been in re-asserting principles of democracy accountability and the rule of law.

 

Alert: Government Attempts to Pass ESM with Minimal Public Debate

Today – Wednesday, & Tomorrow – Thursday

The Government will seek Dail approval of:
The Article 136 TFEU amendment to the EU Treaties which authorises the setting up of the permanent Eurozone loan fund, the European Stability Mechanism
+ A motion to approve the ESM Treaty which is authorized by this amendment
+ A motion to approve future Government spending on the ESM,
TODAY – WEDNESDAY, AND TOMORROW – THURSDAY.
A guillotined debate on the second reading of the latter Bill will take place TOMORROW.

This means that the whole business of signing up the Irish State to the ESM Treaty for the Eurozone and committing us to significant expenditure to help bail out Spain and other Eurozone countries in the coming period, could go through all stages in the Oireachtas BY THE END OF NEXT WEEK – with minimal debate in the Irish media over the long-term implications of these steps or awareness of what this all means amongst the general public.
The ESM Treaty can be downloaded from the internet – http://www.european-council.europa.eu/media/582311/05-t…2.pdf
The relation of the ESM Treaty to the Article 136 TFEU amendment to the EU Treaties authorizing it and to the Fiscal Treaty which Irish voters voted on last Friday is set out in the publication “A Tale of Two Treaties” by Cork solicitors Joe Noonan and Mary Linehan.
This can be downloaded from the internet at: http://taleoftwotreaties.tumblr.com
The letter below to the Ambassadors in Ireland of those EU States which have not yet ratified or approved the ESM Treaty or the Article 136 TFEU amendment sets out the reasons for regarding the ESM Treaty as it stands as illegal under EU law and in violation of the Irish Constitution.
A reformatted standalone version of this as explanatory text, is available here - http://nationalplatform.org/2012/06/06/4-reasons-the-esm-treaty-is-illegal-2/ – “4 Reasons why the ESM Treaty is illegal”.
If these measures are pushed through the Oireachtas this week and next in the way the Government proposes, the only way this profound illegality and unconstitutionality can be prevented is by President Higgins referring the relevant Bill to the Supreme Court for adjudication or by Deputy Thomas Pringle’s legal team securing a relevant injunction to stop it pending a Court hearing of the issues.
Yours sincerely
Anthony Coughlan
Director, National Platform EU Research & Information Centre

People’s Movement patron begins legal challenge on treaties

Thomas Pringle TD explains why he felt compelled to take a court case
on the proposed amendment to article 136 of the Treaty on the Functioning of
the European Union and the ESM Treaty.

As an Irish public representative and citizen I keep asking myself if it would not be absurd if Irish voters were to vote on 31 May in the referendum on the Fiscal Compact Treaty in favour of imposing austerity rules on ourselves in order to get access to a proposed permanent euro-zone loan fund when the separate but “complementary” treaty establishing that fund is arguably illegal under EU law, unconstitutional in Ireland, has not yet come into force, and indeed may never do so.

On 9 March last I wrote to the Taoiseach, the Minister for Finance and the Minister for Foreign Affairs explaining some of these very serious concerns. I have received no reply to this correspondence beyond the usual standard acknowledgement of receipt of the communication.

I have now been left with no other option but to initiate legal proceedings, challenging the Government on fundamental aspects of both the European Stability Mechanism (ESM) Treaty and the Stability, Coordination and Governance in the Economic and Monetary Union (Fiscal Compact) Treaty.

I believe that both treaties raise serious legal difficulties, at the level both of EU treaty law and of Irish constitutional law. My primary democratic concern as both a citizen and an elected public representative is the integrity of the Constitution of Ireland and the EU treaties, which now form such an important part of our constitutional framework. I believe that the matters on which I seek the clarification and assistance of the court are of crucial importance not only for the citizens of this country but for the future of the EU.

My contention is that the particular stability mechanism being set up under the ESM Treaty is in breach of article 29.4.4 of the Constitution of Ireland, under which “Ireland affirms its commitment to the European Union within which the member states of that Union work together to promote peace, shared values and the well being of their peoples.”

The proposed stability mechanism seems on the face of it to permit member-states to work not in solidarity and togetherness but rather towards separation and exclusiveness. This is because it allows only some member-states, and indeed only some members of the euro zone rather than all of them, to participate in an arrangement that will clearly have implications for all.

I am asking the court to examine the legality of the amendment to article 136 of the Treaty on the Functioning of the European Union before any further action is taken by the Government to approve that amendment. That amendment permits the establishment of a “stability mechanism” that would be able to grant financial assistance, “subject to strict conditionality.”

This amendment is being adopted under the so-called “simplified revision procedure,” which I believe is legally wrong. My argument is that the changes being proposed are so fundamental that they should go through the ordinary revision procedure to ensure proper democratic scrutiny. They also require the approval of the Irish people in a referendum.

I am also asking the court to consider whether the ESM Treaty is in breach of existing EU treaty principles that have been approved by the Irish people in previous referendums and that are now therefore part of our law.

In addition, I am asking the court to decide whether the state can ratify the Treaty Establishing the European Stability Mechanism without first having the approval of the people in a referendum.

The Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, signed on 2 March 2012, is intertwined with the ESM Treaty. Each one depends on the other. Therefore, if I am right in my belief that the ESM Treaty is unlawful, there is a serious question over the validity of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union.

And the implications for Ireland are vast, given its present economic situation. Under the ESM Treaty, Ireland would be obliged to make capital contributions of up to €11,145,400,000 in various forms of capital to the new permanent €500 billion bail-out fund that is to be set up. For Ireland this is the equivalent of approximately a third of Government tax revenue for 2011.

I believe that my application to the courts is just one more manifestation of a growing concern within the EU about developments towards a political union for the euro zone along the lines of what President Sarkozy has termed “a federation for the euro zone and a confederation for the EU as a whole.” It is not a direction that I want the EU to take, and I am sure that I am not alone.