BRUSSELS (Reuters) – The European Commission is unlikely to take immediate legal action against Germany over a ruling by the country’s top court that the European Central Bank has overstepped its mandate with its bond purchases, European Union officials said on Monday.
Ursula von der Leyen, the EU executive’s president, raised the possibility of a lawsuit on Sunday over the constitutional court ruling last week which gave the ECB three months to justify bond purchases under its flagship euro zone stimulus programme or lose the Bundesbank as a participant.
But EU officials said the Commission, which has said that EU law holds precedence over national regulations, needs time to weigh the grounds for any legal action and is wary of undermining the independence of the German constitutional court.
“We are touching on the judgment of a national court and the highest court in Germany. So this raises the question of the independence of the judiciary. So we have to be very careful in considering whether or not to launch an infringement procedure,” one of the officials said.
Infringements are legal cases the Commission can bring before the Court of Justice of the European Union (CJEU) if the Brussels-based executive deems a member state is violating EU law. The court can order a nation to make amends, or face hefty fines.
Taking Germany to the CJEU, the EU’s highest court, would not overturn the German court’s ruling anyway, the EU officials said.
“This final (German constitutional court) judgment cannot be changed. So the question is, if we launch an infringement procedure, what will it leave,” one of the EU officials said.
Launching legal action does not necessarily mean a case ends up in court, the officials said.
But opening legal proceedings would lead to “an important element of dialogue between the Commission and the member state concerned on what should be done,” one of them said.
The timing of any legal action would also depend on whether the European Commission decided to focus solely on the German constitutional court ruling or to launch proceedings against the Bundesbank or the German government, the EU officials said.
The constitutional court’s verdict dealt a blow to the unprecedented 2-trillion-euro purchase scheme that kept the euro zone in one piece after its debt crisis but which critics argue has flooded markets with cheap money and encouraged over-spending by some governments.
(Editing by Timothy Heritage)