introduction to the law of economic and monetary union piet jan slot, europa insituut university of...
TRANSCRIPT
Introduction to the Law of Economic and Monetary Union
Piet Jan Slot, Europa Insituut University of Leiden
February 23, Istanbul
Index
• Introduction
• Free movement of capital
• Present framework
• Proposal for future action
• Q&A
Introduction
• What is an economic and monetary union?
- “econonic” v “monetary” - extremely complex subject
Capital
• Originally the ugly duckling of the free movement provisions.
• No hard and fast obligation with direct effect.
Capital
• Directive 88/361 implemented free movement and provided a classification of capital movements.
• It is still important to distinguish between payments and capital e.g. art. 64. Note XI C Dowries.
Present Framework
• Key provision art. 119 TFEU.
• Which provisions apply to all EU MS and which only to MS with the euro?
- In general provisions on monetary policy apply only to Euro MS and provisions on economic policy apply to all MS except for 121(2), 126(9) and (11).
• Relevant articles in TFEU:
- Article 121, coordination of economic policy
- Article 123, 124 and 125
- Article 126, multilateral surveillance
Economic Policy
• Key Article 127 TFEU
• Key role for ECB
• Primary objective: price stability
Monetary Policy
• Article 136: powers to take measures for the Euro MS
(a)to strengthen coordination and surveillance of budgetary discipline;
(b)to set out economic policy guidelines.
New Article in Lisbon Treaty
• EFSM establishing an European Financial Stabilisation Mechanism.
• EFSF stands for European Financial Stability Facility, Decision of representatives of the MS.
• ECB action: buying bonds and providing liquidity for banks.
Actions to Combat the Crisis
• A permanent European Stability Mechanism (ESM) will be created on the basis of a new Treaty article.
• The ESM will be modelled after the IMF.
• Distinct features of the ESM.
Proposals for Future Action
• The six pack (part I)
- Regulation (EU) No 1173/2011 (effective enforcement of budgetary surveillance)
- Regulation (EU) No 1174/2011 (enforcement measures to correct excessive macroeconomic imbalances)
- Regulation (EU) No 1175/2011 ( amending the old stability and Growth pact)
Proposals for Future Action
• The six pack (part II)
- Regulation (EU) No 1176/2011 (prevention and correction of macroeconomic imbalances)
- Council Regulation (EU) No 1177/2011 (speeding up and clarifying the implementation of the excessive deficit procedure)
- Council Directive 2011/85/EU (requirements for budgetary frameworks of the Member States)
Proposals for Future Action
• The new treaty: at the informal summit on 30 January 2012 a new Treaty on Stability, Coordination and Governance in the Economic and Monetary Union was finalised by all EU member states with the exception of the United Kingdom and the Czech Republic.
Proposals for Future Action
• The Treaty aims to strengthen fiscal discipline through the introduction of more automatic sanctions and stricter surveillance, and in particular through the "balanced budget rule".
Proposals for Future Action
