The European Stability Mechanism and financial assistance

Abstract

This chapter contains a reconstruction of the political and legal process leading up to the adoption of the European Stability Mechanism (ESM) Treaty and its subsequent review by several national courts and the European Court of Justice in C-370/12 Pringle. The purpose of this reconstruction is to show how interaction between national courts and the European-level political process functions. Furthermore, the reconstruction also showcases how political motivations and legal frameworks affected the process. Then, the constitutional significance of the ESM is discussed. This analysis centres on the asymmetrical structure of the Economic and Monetary Union and how this is visible in the ESM. Furthermore, the links between the ESM and the other crisis response mechanisms are discussed. It is argued that establishing the ESM through international law made possible the extended judicial review by national courts, which, subsequently, leads to the inequality thesis. The reconstruction of the events reveals differences in when national courts were able to participate. Courts that were able to review the ESM Treaty at an earlier stage of the political process had the possibility to affect its course, whereas courts that reviewed it at a later stage faced the ungrateful task of accepting it due to the predicament that the political significance of the issue created.