Ratification of ESM pact on hold for appeal


THE GOVERNMENT has undertaken not to ratify the European Stability Mechanism treaty 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. The Government had hoped to ratify it this week.

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

Yesterday, Chief Justice Mrs Justice Susan Denham fixed July 23rd for the appeal after lawyers for the Government and Mr Pringle told her they wanted 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 it could affect the coming into operation of the ESM treaty.

The ESM could not 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.

Mr Rogers’s 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. 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 would give its judgment before the end of July, Mr Cush said. If that judgment was favourable to Germany it would ratify the treaty.

The Government considered it “a political imperative” that Ireland was at the table with a vote as soon as the treaty was operational, and disagreed that all aspects of the appeal had 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, that it should not ratify until the Supreme Court dealt with the appeal, he added.

Mr Cush said the High Court had found no unconstitutional breach of Irish fiscal sovereignty and, from the State’s perspective, the determination of Mr Pringle’s appeal against that finding was the imperative matter.

Mr Rogers argued that the constitutional issue was linked to the claims of incompatibility of the ESM with existing EU treaties.

In her High Court ruling, Ms Justice Laffoy said she would refer to the European Court of Justice an issue concerning the implications of the intention of members of the ESM to ratify the treaty now, before the coming into force next January of the March 2011 European Council decision authorising establishment of an ESM.