Battle for institutional banking union, which would be the major project to improve the institutional architecture of the eurozone. And just four months before the election. The German Finance Minister, Wolfgang SchÃ_uble, traveled to Brussels on Monday to the threat of veto Parliament the proposal for a single bank resolution mechanism adopted in late December and ratified by Ecofin. SchÃ_uble met with Parliament's negotiating team, according to sources present at that meeting and as confirmed by the German government, and in turn a threat uttered Berlin veto the implementation of the single - resolution mechanism to close banks - if you touch a one point of agreement reached at the end of the year.
The skein was increasingly entangled. The president of the European Parliament, Martin Schulz, has sent a letter to José Manuel Barroso in claiming that the European Commission acts to ensure that Parliament is not left out of the agreement Tuesday. "The decision taken by the Council in December is more than doubtful," said Schulz, who substance a warning not to greenlight the resolution mechanism on schedule before the end of the legislature. That would delay all terms of the banking union and put even more pressure on the financial sector exams to do the European Central Bank (ECB), built either as single banking supervisor. Without the firewall that mechanism and the consequent resolution fund, the ECB may have trouble making a thorough analysis of the state of the European financial system.
After that litigation is a legal battle and one with much more substance, for the design of the instrument. Germany pressed a month ago to approve the resolution mechanism through an intergovernmental agreement, and not through the traditional method - community, leaving Parliament out of the play without much maneuverability styling seeking agreement a more ambitious mechanism, less taste of Berlin. Germany claims against the criterion of legal services of the Council, the Commission and the Parliament, the tax treaties do not allow banks to which the sector must finance the latch entities.
With that premise, SchÃ_uble convinced the Eurogroup finance ministers in order to find a fit through an intergovernmental agreement that would prevent a change treaty. Parliament also has serious objections on the mechanism itself, therefore decision - complex and dominated once again by the Member States, the Commission testimonial on a paper - like background design resolution that for 10 years would hardly coordinated with watertight compartments for each country, and that leaves the mutualisation fund (if that does occur) to within a decade.
Meeting in Brussels SchÃ_uble was clear and direct in his meeting with Parliament's negotiating team, led by Portuguese MEP Elisa Ferreira: "The decision is yours," he said, according to sources at the meeting, " but if the December agreement is changed there will be no mechanism resolution. "
Finance Minister Angela Merkel 's cabinet in late December managed to prevail German dissertation, a continental FROB of the key is reserved: a lack of the final draft and the green light from Parliament, the pact gave the capital eurozone the last word on the involvement of a financial institution in difficulties, and conditional capital injection to a voting system that recognizes the brunt of Germany's contribution to the fund of 56,000 million euros in within 10 years. The weighted voting system applies whenever the fund consumption exceeds 5,000 million euros in a year, a negligible amount just come to rescue banks in Slovenia, and is just the fifth rescue Bankia.
"The decision taken at the time by the Board jeopardizes the Community method and has implications that go beyond the proposal or even the banking union," according to the letter hard Schulz. " Completely contradicts the principle of sincere cooperation between institutions," says the letter, which has had access to this journal. Given the obvious displeasure of the Parliament - " their legality is more than doubtful " - Schulz warns that the agreement about the resolution mechanism before the end of the legislature is now quite difficult. "The outcome of the negotiations is uncertain at this time," the president of the Parliament.
Parliament sources said the deal is flawed and criticized the intergovernmental mechanism approved by German pressure. But at least they explained that sets the precedent that it is a first step towards mutualisation, within 10 years - a giant step forward compared to the usual dilettante leadership of Germany. "Parliament can take heart if vein, with Schulz at the forefront of the campaign trail, but perhaps in this case Germany would come out ahead because if that pooling mechanism just not being approved. Hence SchÃ_uble can afford these threats, "according to these sources.
Tags: banking, Germany, parliament, Union