My dissertation topic concerns the European Central Bank ‘’whatever it takes approach’’ regarding the legality of its initiatives to safeguard the common currency during the crisis. The topic is divided into two main parts. The first one examines the framework under which Mario Draghi’s speech and the announcement of OUTRIGHT MONETARY TRANSACTION took place when the second one focuses on the compatibility of the Outright Monetary Transaction program with EU Law and the approach followed by the European Court of Justice through case law on this matter.
More specifically, is well known that the European Central Bank operates as a monetary authority to those Member States who have adopted Euro as their single currency. The primary role of the ECB is to define and implement monetary policy and in order to do so is equipped with a wide range of monetary tools. Furthermore, besides the maintenance of price stability laid down in Article 127TFEU which constitutes the primary objective of the European System of Central the ESCB additionally shall support general economic policy in the view of achievement the tasks laid down in article 3TEU. It is beyond a doubt that the role of the ECB is not unlimited, but it is determined by Article 123 and 125 TFEU coordinately. The global financial and debt crisis had a great impact to both National Central Banks and the ECB threating directly the common currency and arising the need for immediate and effective measures. The extraordinary circumstances led the ECB to undertake measures, mostly out of its traditional role in order to avoid the collapse of the single currency.
In the apogee of the euro crisis, in 2012, Mario Draghi in his constitutional role as a President of the ECB, announced in a speech given in London that the ECB is ready to do whatever it takes adding believe me, it would be enough. A month later, the ECB’s Government Council specified the above statement and took the decision for the Outright Transaction Program emphasizing in its main objectives which were strictly linked with the safeguard of the appropriate monetary policy and the singleness of the common currency. The OMT program as an initiative aimed to help eurozone countries to avoid the collapsing by buying short-term government bonds in the secondary market. In addition, the OMT was considered for Member States currently under macroeconomic adjustments program. However, the role of the ECB as guarantor of price stability combined with the promise to do whatever it takes laid down significant issues of legality. In other words, Article 123 TFEU declared that any type of direct purchase of government bonds by the ECB or the National Central Banks is strictly prohibited. Hence, the crucial legal issue is if the OMT constitutes a step into field of economic policy and consequently if violates EU law.
The monetary policy has transferred to the exclusive competence of the ECB while economic policy remains in the MS. However, an absolute distinction among monetary and economic policy is not practical feasible. Both areas are interlinked. It seems that the OMT program, ECB moved into a grey area among monetary and economic policy. OMT program might considered as an unconventional monetary instrument which had created and used during and because of the euro crisis aiming to ensure the proper function of monetary transmission mechanism Further is undeniable, that the sorely fact that a monetary measure has indirect effects in economic field cannot led to be treated as an equivalent economic measure.
(EL)
My dissertation topic concerns the European Central Bank ‘’whatever it takes approach’’ regarding the legality of its initiatives to safeguard the common currency during the crisis. The topic is divided into two main parts. The first one examines the framework under which Mario Draghi’s speech and the announcement of OUTRIGHT MONETARY TRANSACTION took place when the second one focuses on the compatibility of the Outright Monetary Transaction program with EU Law and the approach followed by the European Court of Justice through case law on this matter.
More specifically, is well known that the European Central Bank operates as a monetary authority to those Member States who have adopted Euro as their single currency. The primary role of the ECB is to define and implement monetary policy and in order to do so is equipped with a wide range of monetary tools. Furthermore, besides the maintenance of price stability laid down in Article 127TFEU which constitutes the primary objective of the European System of Central the ESCB additionally shall support general economic policy in the view of achievement the tasks laid down in article 3TEU. It is beyond a doubt that the role of the ECB is not unlimited, but it is determined by Article 123 and 125 TFEU coordinately. The global financial and debt crisis had a great impact to both National Central Banks and the ECB threating directly the common currency and arising the need for immediate and effective measures. The extraordinary circumstances led the ECB to undertake measures, mostly out of its traditional role in order to avoid the collapse of the single currency.
In the apogee of the euro crisis, in 2012, Mario Draghi in his constitutional role as a President of the ECB, announced in a speech given in London that the ECB is ready to do whatever it takes adding believe me, it would be enough. A month later, the ECB’s Government Council specified the above statement and took the decision for the Outright Transaction Program emphasizing in its main objectives which were strictly linked with the safeguard of the appropriate monetary policy and the singleness of the common currency. The OMT program as an initiative aimed to help eurozone countries to avoid the collapsing by buying short-term government bonds in the secondary market. In addition, the OMT was considered for Member States currently under macroeconomic adjustments program. However, the role of the ECB as guarantor of price stability combined with the promise to do whatever it takes laid down significant issues of legality. In other words, Article 123 TFEU declared that any type of direct purchase of government bonds by the ECB or the National Central Banks is strictly prohibited. Hence, the crucial legal issue is if the OMT constitutes a step into field of economic policy and consequently if violates EU law.
The monetary policy has transferred to the exclusive competence of the ECB while economic policy remains in the MS. However, an absolute distinction among monetary and economic policy is not practical feasible. Both areas are interlinked. It seems that the OMT program, ECB moved into a grey area among monetary and economic policy. OMT program might considered as an unconventional monetary instrument which had created and used during and because of the euro crisis aiming to ensure the proper function of monetary transmission mechanism Further is undeniable, that the sorely fact that a monetary measure has indirect effects in economic field cannot led to be treated as an equivalent economic measure.
(EN)
Εθνικό και Καποδιστριακό Πανεπιστήμιο Αθηνών
