Halt to ESM ratification pledged

The Government has undertaken not to ratify the European Stability Mechanism Treaty (ESM) pending the appeal by Independent TD Thomas Pringle against the High Court’s rejection of his claims the treaty breaches the Irish Constitution and EU law.

The treaty provides for a conditional permanent bailout fund for distressed states in the 17-member euro zone, and the Government had hoped to ratify it this week.

Yesterday, Ms Justice Mary Laffoy refused an injunction restraining ratification after rejecting Mr Pringle’s claims the treaty was unconstitutional or invalid udner EU law, but the judge said she would refer a legal issue to the Court of Justice of the EU (CJEU), the determination of which could impact the effect and operation of the ESM treaty.

Yesterday, the Chief Justice, Ms Justice Susan Denham, fixed July 23rd for the appeal after being told by lawyers for the Government and Mr Pringle they wanted a a speedy hearing.

Earlier, John Rogers SC, for Mr Pringle, said the urgency of the appeal depended a lot on what happened at a hearing before the German Constitutional Court this week as that could impact on the coming into operation of the ESM treaty. The ESM cannot come into operation without participation of 90 per cent of the states subscribing to the bailout fund and cannot come into operation in current circumstances without Germany, he said.

His side disputed Ireland’s capacity to ratify the ESM treaty on grounds it was at odds with the Economic and Monetary Union provisions of EU treaties. There were also constitutional considerations arising from the Supreme Court decision in the Crotty case, it was argued.

Michael Cush SC, for the Government, said it would undertake not to ratify the treaty if the Supreme Court would hear the appeal this month.

The State considered it likely the German Constitutional Court will give its judgment before the end of July, counsel also said. If that judgment was favourable to Germany, it would ratify the treaty and that would be enough to bring the treaty into force.

The Government considered it “a political imperative” that Ireland is at the table with a vote as soon as the treaty is operational and disagreed all aspects of the appeal have equal urgency, he said.

While the Government considered there was nothing to prevent it ratifying the treaty now, it believed, in light of the Crotty judgment, it should not ratify until the Supreme Court dealt with the appeal, he added.