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Did Germany’s Constitutional Court Inadvertently Strengthen the Eurozone?

Despite the knotty issues raised by the court’s recent ruling on the European Central Bank's program to purchase member states' public-sector bonds, there could be a silver lining. It is now more likely that the European Union will be forced to confront the main institutional weakness of its monetary union head-on.

FRANKFURT – In its recent ruling on the European Central Bank’s program to purchase member states’ public-sector bonds in secondary markets, Germany’s Federal Constitutional Court (GCC) concluded that the ECB failed properly to assess and explain the “proportionality” of its policies. In the process, the Karlsruhe-based court rejected the primacy of European law, a core and constitutive principle of the European Union, by also ruling that the decision by the Court of Justice of the EU (CJEU) to uphold the ECB program was “simply incomprehensible,” unconvincing for “methodological reasons,” and exceeded the court’s remit.