Bailouts, the legal status of Memoranda of Understanding, and the scope of application of the EU Charter: Florescu

It is a measure of the complexity of Economic and Monetary Union law that almost 10 years since the onset of the Euro crisis we do not yet have an answer to some of the most fundamental legal questions about the bailouts that were coordinated by the EU: 1) What is the legal nature (and/or effects) of a Memorandum of Understanding (MoU), which lays down the conditions attached to the financial assistance granted to the recipient State? 2) Which legal remedies may admissibly be brought against the bailout conditions before the EU courts? 3) Do the national measures adopted in implementation of the MoU fall within the scope of application of the EU Charter of Fundamental Rights, which has formed the basis of many, unsuccessful thus far, challenges?

A new judgment delivered by the ECJ’s Grand Chamber (Case 258/14, Florescu) now provides more clarity on these issues. The attention thus far given to the judgment is not commensurate with its legal significance. The case originated in Romania and concerned a national measure which prohibited the combining of a net pension with income from activities carried out in public institutions if the amount of the pension exceeded a certain threshold – a typical austerity measure, adopted in many countries hit by the crisis. The measure was linked to an MoU concluded between the European Community (as it then was) and Romania for the purposes of balance-of-payments assistance (see Article 143 TFEU and Regulation 332/2002). The applicants sought to argue that the impugned measure was adopted in implementation of the MoU, which was, in their opinion, part of EU law; and that it violated their Charter right to property (Article 17).

The Court qualified, for the first time ever, the MoU for balance-of-payments assistance as an act of an EU institution which may be subject to a request for interpretation pursuant to Article 267 TFEU (reference for a preliminary ruling). Moreover, it established a link between the impugned national law and the MoU, holding that the former was adopted in implementation of the latter. Since the MoU formed part of EU law, the impugned national measure was ‘implementing Union law’ within the meaning of Article 51(1) of the Charter and was therefore brought within its remit. This flies in the face of the Court’s earlier jurisprudence, where it was held that the Member States concerned (Portugal and Romania) were not ‘implementing Union law’ in adopting the impugned austerity measures. The Court in Florescu, however, upheld the legality of the impugned measure, ruling that it was not disproportionate to the attainment of the objective pursued.

In a new article published in the Common Market Law Review (Volume 55, Issue 2, pp. 643-672), we look at this important judgment. In holding that the MoU for balance-of-payments assistance to non-Eurozone countries is an act of an EU institution which may be subject to interpretation by the Court (also in the light of the Charter), the Court enhanced the legal accountability of the EU institutions for their actions related to bailouts. The bailout conditions shall be interpreted in the light of all primary and secondary EU law, including the EU Charter, and may therefore be brought to bear a different meaning, insofar as this would not result in a contra legem interpretation. It is hoped that this might serve to mitigate the MoU’s adverse impact on the socioeconomic conditions in the recipient State.

We believe that this case will condition the future development of Economic and Monetary Union law, in ways that may not yet be readily apparent. Questions abound: is the MoU for balance-of-payments assistance legally binding or simply ‘mandatory’ in the sense that the disbursement of financial assistance is linked to the fulfilment of the conditions in the MoU? Is it only subject to interpretation by the Court pursuant to Article 267 TFEU (as would be the case for EU soft law measures) or could it also be declared (wholly or partially) invalid pursuant to Article 267 TFEU or 263 TFEU? Is it possible to extend the Court’s findings in Florescu to MoUs with other EU financial assistance mechanisms, such as the European Financial Stabilisation Mechanism (EFSM)? Furthermore, as regards the financial mechanisms placed outside the EU legal order, would it be possible to argue that the conditionality linked to the MoUs with the European Financial Stability Facility (EFSF) and the European Stability Mechanism may be subjected to judicial scrutiny thanks to the Council Decisions adopted under the Excessive Deficit Procedure (Articles 126 and 136 TFEU) and ‘two-pack’ legislation (Article 7 of Regulation 472/2013)? Would there equally be a link to the EU Charter of Fundamental Rights in the case of such Council Decisions (Article 51(1) of the Charter)? We have sought to provide an answer to these questions in our article, arguing that the view favoured by the Court seems to be that the MoU is capable of producing binding legal effects; that the Florescu’s ratio decidendi may be extended to other financial mechanisms established within the EU legal order; and that, as regards those mechanisms established outside the EU legal framework, one could draw on the Council Decisions setting out the core bailout terms, which may be judicially examined in the light of the EU Charter of Fundamental Rights.

About: Shawn

Shawn Shah is an expert legal analyst, lawyer, and journalist.


36 thoughts on “Bailouts, the legal status of Memoranda of Understanding, and the scope of application of the EU Charter: Florescu”

  1. Rüyada yılan ezmek; hak etmediği halde bir kimseye zarar verdiğinize yorumlanır.
    Rüyada yılan kafası görmek veya yılanı eline almak birine yaptığınız
    bir fenalıktan dolayı pişmanlığınızın artacağına
    yorumlanır. Eğer imnkan varsa bu kişinin kim olduğunu tespit edip gönlünü almanız tavsiye edilir.

  2. For most up-to-date information you have to pay a visit world-wide-web and on the web I found this site as a
    most excellent website for most recent updates.

  3. When I initially commented I clicked the “Notify me when new comments are added” checkbox and now each time a
    comment is added I get four emails with the same
    comment. Is there any way you can remove people from that service?
    Many thanks!

  4. I’m amazed, I have to admit. Seldom do I encounter a blog that’s equally educative and engaging, and without a doubt, you’ve hit the nail on the head.

  5. Greetings from Carolina! I’m bored to tears at work so I decided to check out your blog on my iphone during lunch break. I enjoy the information you provide here and can’t wait to take a look when I get home.
    I’m amazed at how quick your blog loaded on my phone .. I’m not even using WIFI, just 3G ..
    Anyways, wonderful blog!

  6. Thanks for another great article. Where else may just anybody get that kind of info in such a perfect approach of writing? I’ve a presentation subsequent week, and I’m at the look for such information.

  7. I think everything said was very reasonable.
    However, what about this? what if you were to create a killer post title?
    I ain’t saying your information isn’t good., but suppose you
    added something that grabbed a person’s attention? I
    mean Bailouts, the legal status of Memoranda of Understanding, and the scope of application of the EU Charter:
    Florescu – LawSiteBlog is a little boring. You ought to
    peek at Yahoo’s front page and watch how they create post headlines to grab people to click.
    You might add a video or a pic or two to get readers excited about
    everything’ve got to say. In my opinion, it might
    make your blog a little bit more interesting. http://cor.to/link188bet57477

  8. Amazing blog! Do you have any suggestions for aspiring writers?
    I’m hoping to start my own site soon but I’m a little lost
    on everything. Would you suggest starting with a free platform like WordPress or go for a paid option? There are
    so many options out there that I’m completely confused .. Any suggestions?
    Thanks!

  9. I got this website from my pal who shared with me concerning this website and at the moment this time I am visiting this web site
    and reading very informative posts at this time.

  10. Good post. I learn something new and challenging on websites I stumbleupon everyday. It’s always useful to read content from other
    authors and use something from other websites.

  11. Marchettiemaldonado.Com.Br
    Over the years of using vibrators, my taste has gone to direct,
    intense, pinpoint high power stimulation. But I wondered in my heart
    of hearts if a big roundy massager vibe could ever work for me.
    I’d heard amazing things about the Hitachi, I mean who hasn’t?
    But it was still just a tad out of my price range for something that may not work for me.

    cheap vibrators And knowing how to do that is a pretty big deal.
    And know what? You’ll learn that in time. Everything is going to be alright.

    By being friends that fool around, you haven’t suddenly taken that friendship up another level, closer to love,
    even if it feels like it. You’re still just his “friend” and he’s still going to
    see whoever he wants to, while coming back to you when he feels like it.
    Not only are you hurting yourself, you’re going
    to ruin whatever friendship you have left with him by agreeing to
    this arrangment and then you’ll have nothing left but pieces of what
    once was.. cheap vibrators

    cheap sex toys I was quite excited when I first tested
    out the vibrations in this toy. There are 12 patterns, many of
    which are too complex to describe through text.
    For each pattern, there are 5 intensities, and when you change patterns, the intensity
    automatically sets to the 3rd level. cheap sex toys

    vibrators Isn a taking a break but I be back blog this is it.
    The end of escorting for me, but the beginning of something even more wonderful.
    Thank you to the men, the women, the amazing
    non judgmental staff at hotels for giving me 6 wonderful years as an Australian escort.
    vibrators

    vibrators With the bright sassy red, this product could make a good gift for a lover for Valentine’s Day or Christmas.
    Or it could be a good prize item for a toy party or game night
    with the girls. You can also wear it while making a
    steamy home movie together or for someone, and do a little strip tease in this cute outfit!
    The options are limitless with lingerie.. vibrators

    butt plugs The Backend Exciter is just that exciting vibe for your
    butt. The Backend Exciter is a little longer
    than most anal toys: 4 3/4 inches insertable. But that added length adds to the
    pleasure. They are more likely to lose their means of livelihood and face heightened risks of gender based violence, such as sexual violence, including rape,
    as well as early marriage and human trafficking due to displacement
    and the breakdown of the normal structures of protection and support.(3)Further, in the aftermath of disasters, their specific humanitarian needs are often neither adequately identified nor
    addressed in the ensuing response by governments and humanitarian agencies alike.(4)The 2030
    Agenda for Sustainable Development clearly posits that all women and
    girls, regardless of their location, situation,
    and circumstances or migratory status, should be entitled
    to a life free from violence and its consequences. Any measure taken to achieve Goal 5 and eliminate all
    forms of violence against all women and girls must include those affected by crisis
    and conflict.(1) Promoting the rights, need and
    agency of women and girls in humanitarian action, UN Women, 2016, p.2(2) Ten year review finds 87%
    of disasters climate related, UNISDR, 2015(3) Report of the Secretary General, Trafficking in women and girls,
    2016, p.6(4) Promoting the rights, need and agency of women and girls in humanitarian action, UN Women, 2016, p.2SOME RELEVANT PROGRAMMES AND PROJECTS:On 25 April 2015, a 7.8 magnitude earthquake struck Nepal, followed by another powerful 7.3 magnitude quake on 12 May.
    In the ongoing response to the earthquakes in Nepal, UN Women worked side by side with the government,
    UN OCHA, other UN agencies, as well as women’s groups to highlight the distinct
    needs of women and girls, and to promote their
    role as meaningful participants in the eventual recovery, reconstruction, and development.
    butt plugs

    vibrators So, a total net gain of (drumroll, please):
    $100 million dollars!(Not to mention, education funding in OK overall has
    experienced significant cuts consistently for at least the past decade.)And the OK
    legislature considers this a victory (or rather, “a good starting point”) and expects it will
    placate all of those in the state calling for increased education funding.EDIT: Some people in a thread over on /r/Oklahoma are pointing out that it isn’t fair
    to compare the 1990 funding, which also included teacher salaries, to only the $50
    million signed recently by Governor Fallin (and ignoring the $447 million solely for pay raises,
    which she also signed at the same time), and I agree, it isn quite fair.

    I have a feeling, though, that the disparity is actually
    greater, even if we do compare the 1990 bill as a whole (including teacher salaries).

    $560 million in 1990 is equivalent today to just over 1 billion vibrators.

  12. My spouse and I absolutely love your blog and find many of your post’s to be exactly I’m
    looking for. can you offer guest writers to write content for yourself?

    I wouldn’t mind composing a post or elaborating on a few of the subjects you write
    regarding here. Again, awesome site!

  13. Today, I went to the beachfront with my kids. I found a sea shell and gave it to my 4-year-old daughter and said: “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and screamed. There was a hermit crab inside and it pinched her ear. She never wants to go back!
    LoL, I know this is totally off topic but I had to tell someone!

  14. That is a really good tip particularly to those new to the blogosphere.
    Simple but very precise information… Appreciate your sharing this one.
    A must read article!

  15. Hi! I could have sworn I’ve been to your blog before but after looking at some
    of the posts I realized it’s new to me. Anyways, I’m certainly pleased I
    found it and I’ll be bookmarking it and checking back often!

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: