''Gauweiler and Others v Deutscher Bundestag'' (2015
C-62/14
is an EU law case relevant for banking law which approved outright monetary transactions that were needed to save the

Eurozone The euro area, commonly called eurozone (EZ), is a currency union of 19 member states of the European Union (EU) that have adopted the euro (€) as their primary currency and sole legal tender, and have thus fully implemented EMU policies ...

from financial turmoil.

Facts

The

German Constitutional Court The Federal Constitutional Court (german: link=no, Bundesverfassungsgericht ; abbreviated: ) is the supreme constitutional court for the Federal Republic of Germany, established by the constitution or Basic Law () of Germany. Since its inc ...

asked the CJEU whether the

European Central Bank The European Central Bank (ECB) is the prime component of the monetary Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union. It is one of the world's Big Four (banking)#Intern ...

buying government bonds issued by euro states (the ‘ Outright Monetary Transactions’ programme), in a 6 September 2012 press release, was unlawful, either because it was economic policy, not monetary policy, or because it violated TFEU art 123(1) which prohibited monetary financing for member states. This followed a conservative German politician named

Peter Gauweiler Peter Gauweiler (born 22 June 1949) is a German lawyer and politician of Bavaria's Christian Social Union (CSU) who served as a member of the German Bundestag from 2002 to 2015, representing the Munich South district. From 2013 until 2015, he al ...

challenging the ability of the Eurozone to assist non-German member states that were in financial difficulty. The ECB said it would buy bonds on the secondary markets issued by states if (1) the state became subject to the European Financial Stability Facility assistance programme and the European Stability Mechanism (2) transactions focused on the shorter part of the yield curve (3) no quantitative limits were set in advance (4) the ECB got the same treatment as private creditors (5) the ECB undertook that liquidity created would be fully sterilised. AG Cruz Villalon gave an opinion in favour of the EU policy.Opinion
/ref>

Judgment

The Grand Chamber of the CJEU held that the European Central Bank could adopt a programme to buy government bonds on the secondary markets under

TFEU The Treaty on the Functioning of the European Union (TFEU) is one of two treaties forming the constitutional basis of the European Union (EU), the other being the Treaty on European Union (TEU). It was previously known as the Treaty Establishi ...

articles 119, 123, 127 and articles 17 to 24 of Protocol (No 4) on the Statute of the European System of Central Banks and of the European Central Bank. The outright monetary transaction programme was monetary policy, and measures taken were proportionate to the objectives without contravening TFEU art 123.

Notes

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References

* Court of Justice of the European Union case law United Kingdom enterprise case law

Facts

Judgment

See also

Notes

References