The EU's highest court on Friday said it alone had legal authority over the European Central Bank, firmly rejecting a German Constitutional Court ruling critical of the bank's ambitious stimulus policies.
The highly unusual intervention came after the German ruling issued particularly harsh criticsm of European court judges, setting up a clash between the EU institutions and their most powerful member state. "In order to ensure that EU law is applied uniformly, the Court of Justice (ECJ) alone... has jurisdiction to rule that an act of an EU institution is contrary to EU law," a statement said.
"Divergences between courts of the member states as to the validity of such acts would indeed be liable to place in jeopardy the unity of the EU legal order and to detract from legal certainty," it added.
Germany's Constitutional Court said the Luxembourg-based ECJ had rubber-stamped ECB policy with confusing argumentation and declared it not legally binding.
EU-watchers feared the judgment could be a boost for nations like Hungary and Poland, whose reforms to the political and judicial systems have drawn allegations they are undermining democracy.
Sidelining the EU court, the German judges gave the ECB three months to justify its polices and the bank has said it will try to find a diplomatic solution.
Without an explanation, German judges in Karlsruhe said they will ban the country's powerful Bundesbank central bank from participating in the stimulus. The ECB's massive bond-buying programme is credited with having put an end to the eurozone debt crisis.
The German judges demanded in particular more details about the pros and cons of the ECB's 2.2 trillion euros ($2.4 trillion) of government bond purchases since 2015, under a programme known by the initials PSPP. But some observers are concerned that the court decision will be used in Germany to discredit another bond-buying spree.
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