Bloomberg News

German Court Won’t Review Economics of Greek Bailout, Judge Says

July 05, 2011

July 5 (Bloomberg) -- A German high court judge hearing a challenge to the country’s participation in a multi-billion-euro rescue package for Greece said the court’s role isn’t to review economics.

The court won’t consider the economic strategy to tackle the sovereign debt crisis, Presiding Judge Andreas Vosskuhle said at a hearing in Karlsruhe, Germany, today.

Germany’s highest constitutional court is hearing oral arguments in three cases challenging the country’s role in the Greek bailout and the euro-area rescue fund last year. The cases were filed by academics and a lawmaker who have unsuccessfully turned to the court before to try to block Germany’s participation in European Union treaties.

“Europe’s future and the right economic strategy to tackle the sovereign debt crisis isn’t debated in Karlsruhe,” Vosskuhle said. “That’s the task of politicians, not of judges. But the Federal Constitutional Court must consider the limits that the constitution sets the political realm. Self limitation by law is the foundation of the democratic constitutional state -- above all in a crisis situation.”

While European leaders work on additional steps to avoid a Greek default, the court is reviewing two packages from May of last year. The cases target Germany’s share of the 110 billion- euros in loans for Greece from euro-region governments and the International Monetary Fund as well as participation in a separate euro rescue fund that sought to halt the spread of Greece’s debt crisis.

The 750 billion-euro rescue fund includes 440 billion euros in guarantees from euro-area governments, 60 billion euros comes from the European Commission -- the EU’s executive arm -- and 250 billion euros from the IMF.

Germany, as Europe’s largest economy, is the biggest contributor to the euro-region bailouts. Finance Minister Wolfgang Schaeuble is scheduled to appear in court to defend the plan.

The cases are BVerfG, 2 BvR 987/10, 2 BvR 1099/10 and 2 BvR 1485/10.

--Editors: Anthony Aarons, Peter Chapman

To contact the reporters on this story: Karin Matussek in Berlin at kmatussek@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@Bloomberg.net.


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