ESM and Protection of Fundamental Rights: Towards the End of Impunity?

Yesterday, the Grand Chamber of the Court of Justice of the European Union (CJEU) issued two important rulings in the cases C-8/15 to C-10/15 (hereafter Ledra Advertising et al. v European Commission and European Central Bank) and C-105/15 to C-109/15 (hereafter Mallis et al. v European Commission and European Central Bank). They should be of interest to anyone concerned with the preservation of fundamental rights under the new governance framework of the Economic and Monetary Union. These two decisions significantly contribute to lifting the ambiguity around the legal status of the anti-crisis instruments that framework now explicitly provides for – the well-known ‘Memoranda of Understanding’ (MoU) and the corresponding Economic Adjustment Programs (see Regulation n° 472/2013) –, and their relationship with fundamental rights instruments, most notably the Charter of Fundamental Rights of the European Union (‘the Charter’). As it contributes to clarifying and strengthening the legal duties of European institutions when they take part to the provision of financial assistance to a member of the Eurozone in need under the European Stability Mechanism (ESM) framework, the move the Court made yesterday should be warmly welcomed, a fortiori because it starkly contrasts with the cautious and timid approach it had so far favoured on these issues (this approach had been deplored in a previous post).

The plaintiffs in these cases are Cypriot nationals that, in the framework of the banking crisis their country went through in 2012-2013, and pursuant to the MoU Cyprus subsequently concluded with the ESM in March 2013, suffered significant financial losses (between 480.000 EUR and 1.600.000 EUR) following the closure of Cyprus Popular Bank and the recapitalization of the Bank of Cyprus ...

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