Germany has come up with legal tactics that it hopes would scupper any chance of ever being fined for running budget deficits above European Union limits, EU diplomats said this morning.
Germany - like France - expects to break the EU deficit cap for the third year running in 2004 and is armed with legal advice saying EU finance ministers could keep reverting to an earlier stage of the budget disciplinary process instead of gradually escalating proceedings against budget offenders.
Any such move would effectively draw the fangs of the already weakened Stability and Growth Pact on budget discipline which Germany had insisted on before the 1999 launch of the euro to protect itself against other countries' profligacy.
But it would need the compliance of the European Commission - which looks unlikely at this stage, sources said.
The German gambit could help France, which is in the spotlight as it has failed to comply with demands to take steps to rein in its budget deficit in 2004, but the diplomats said Berlin had its own agenda as it too faces censure from Brussels.
If the Germans get their way, EU finance ministers would never issue the sort of detailed budget recommendations that are being discussed for France and are the penultimate stage before financial penalties are considered.