The EU debt crisis shifts power to the EU commission

Even experts struggle to fully comprehend the new EU legislation aimed to tackle the European debt crisis, said Allan Rosas from the European Union Court of Justice. Rosas gave a lecture at the University of Helsinki on 13 of January.

The EU debt crisis shifts power to the EU commission

In his lecture, Rosas covered the history and present of the EU’s measures to tackle the economic and debt crisis. No agreement has been found on amending the EU’s constitutional legislation, and the result has been a myriad of new legislation and international treaties.

The debt crisis of Greece was first tackled with a clause allowing financial assistance for a Member State that is in "difficulties or is seriously threatened with severe difficulties caused by natural disasters or exceptional occurrences beyond its control", Rosas explained.

The juridical justification of this approach was disputed. As the crisis escalated, the European Financial Stability Facility was founded in 2010, operating as a private company in Luxemburg.

– These are temporary solutions. The goal is to agree on a new intergovernmental mechanism, adopted in July 2012, Rosas described.

Larger role for the Commission with the "six-pack" legislation

The new "six-pack" legislation that amended the original Stability and Growth Pact came into force in December 2011.

– Looks like the new legislation will give commissioner Olli Rehn and his colleagues more power to monitor economy in general but also competitiveness and employment. We do not know yet to what extent they will be willing and able to use these mechanisms, Rosas said.

In the end of 2011, the EU member states decided to aim for even wider international agreement for coordinating their economic policies. The contents of this agreement are now being discussed.

– The forthcoming agreement may include provisions requiring Member States to enact national legal rules "at constitutional or equivalent level" on balanced budgets, Rosas said.

The new and proposed legislation will substantially restrict powers of the national parliaments. How does this combine with the idea of EU as a project for fostering democracy?

– I understand the concern, but on the other hand, EU is also a project for the rule of law. There has to be consequences if you break the rules, Rosas stated.

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Text: Matti Ylonen
Photo: 123rf
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