I. Opening the Constitution to integration, and legal guiding of the integration process

Let us start with a famous example of juridification: the insertion of Art. 23, known as the “Europe Article,” into the Basic Law in 1992. During the re-drafting of this Article, the constitution-amending legislature closely followed the key principles of the Federal Constitutional Court’s case-law on European integration.

As early as 1967, the Federal Constitutional Court held that the then European Economic Community was a community of a special nature, engaged in a process of ongoing integration to which the Federal Republic could transfer sovereign rights on the basis of Art. 24 of the Basic Law. ^{Footnote 9} Thus, at a very early stage, the Court emphasised the Basic Law’s openness to integration. Its statements served as a model for fixing the establishment of a united Europe as a fundamental national objective, and for the constitutional mandate to implement this objective in Art. 23 sec. 1 sentence 1 of the Basic Law, reinforcing the corresponding commitment in the Preamble of the Basic Law.

At the same time, in its Solange I decision of 1974, the Federal Constitutional Court developed legal guidelines for the internal process of integration, and conditioned the permissibility of the transfer of sovereign rights upon the observance of certain structural requirements. ^{Footnote 10} These concerned the protection of the national constitutional identity, the protection of fundamental rights, as well as the allocation of competences. The Court held that the fundamental-rights part of the Basic Law belonged to the “essential features” of the Basic Law and thus championed an integration that is committed to human and civil rights. ^{Footnote 11} The observance of democratic principles forms an important part of the constitutional identity; in its Solange I decision, the Federal Constitutional Court diagnosed a deficit at the European level in this respect. This was evidenced by the fact that the Community did not have a parliament directly elected by general suffrage that possessed legislative powers, and to which the Community organs empowered to legislate were fully responsible. ^{Footnote 12} With regard to the allocation of competences between the Community and the Member States, the Court further stressed in its Kloppenburg decision of 1987 that the transfer of competences could not be permitted to lead to a renunciation of sovereign statehood, since the Member States were “masters of the treaties”. ^{Footnote 13} This underlines the fact that, according to the principle of conferral, the present Union may only regulate competences for those matters that have been transferred to it, and that it is subject to the principle of subsidiarity when regulating those matters.

These essential requirements developed in the case-law were later codified and further specified by the constitution-amending legislature in what is referred to as the “structure safeguard clause” (Struktursicherungsklausel) of Art. 23 of the Basic Law. It requires the Union to observe democratic, constitutional, social and federal principles, to respect the principle of subsidiarity, and to ensure a level of protection of fundamental rights which is essentially comparable to that afforded by the Basic Law.

II. Validating and securing the ecj’s development of the law

Contrary to what commonly heard phrases such as “the war of the judges” ^{Footnote 14} or “a fight for the last word” ^{Footnote 15} might suggest, the Federal Constitutional Court, at an early stage, constitutionally validated and secured the competence of the European Court of Justice (ecj) to develop the law and emphasised the key role of the Court in the development of the legal community. ^{Footnote 16} This brings me to my second point.

In the early 1960s, the ecj began interpreting its task assigned by the Treaty of “ensur[ing] that in the interpretation and application of the Treaties the law is observed” (Art. 19 sec. 1 Treaty of the European Union (teu)) in a manner that was particularly open towards integration. By supplementing and further developing the law in its decisions, the ecj promoted integration and thereby also strengthened its own position within the institutional system. ^{Footnote 17}

A first milestone for the ecj was its decision in the case of van Gend & Loos in 1963. Therein the Court released the Community from its classic corset under international law and postulated that, with regard to the Member States, Community law constituted an independent legal order and was directly applicable in the Member States without a national implementing measure. ^{Footnote 18} A year later, in its Costa v enel judgment, the ecj continued to develop its case-law along pro-European lines and decided that, in case of a collision between the directly applicable Union law and national law, the former was to be given precedence. ^{Footnote 19} Both decisions symbolise how integration by means of (case-)law works: the European legal order opens itself for citizens and grants them rights such as fundamental freedoms which they can then enforce even against national bodies. This establishes the requisite conditions for the unhindered cross-border movement of goods, persons, services and capital, as a consequence of which economic, social and cultural interdependencies arise that are elementary for the achievement of the objectives of the European Union, namely peace, freedom and prosperity. At the same time, the principle of precedence enables the coordination of great bodies of law between Union law and national law, and secures a consistent application of the law.

At the national level, the Federal Constitutional Court did not put the brakes on the ecj as a “motor of integration,” but rather even encouraged it at times by recognising its jurisprudence. In 1967 it concurred with the classification of Community law as a legal order distinct from international and national law. ^{Footnote 20} Moreover, in 1971, ^{Footnote 21} and thus relatively early in comparison with the constitutional or highest courts of other countries, ^{Footnote 22} it constitutionally validated and secured the principle of precedence of Union law, even though it chose a different dogmatic legal reasoning than that of the ecj. Finally, in 1987, it generally, and for the first time expressly, accepted the method of judicial development of the law by the ecj, citing the centuries-old tradition of judicial creation of law in Europe, reaching from Roman law to German labour law. ^{Footnote 23}

Now the task of ensuring the enforcement of European and national law falls mainly to the national administrations and courts. On account of the decentralised implementation model, national regular courts are important players in the implementation of Union law. ^{Footnote 24} In this respect, the procedure for a preliminary ruling according to Art. 267 of the Treaty on the Functioning of the European Union (tfeu) is absolutely fundamental for the juridification of the European process of integration. ^{Footnote 25} It procedurally secures the obligation of the national courts to grant precedence to Union law over conflicting national law, and reflects the sharing of responsibility in an association in which the two levels, Union law and national law, are linked. ^{Footnote 26}

III. The implementation of the obligation to refer a matter to the ecj

The preliminary ruling procedure would, however, be ineffective in part if the obligation to refer a matter to the ecj were not subject to review. Thus, the Federal Constitutional Court, from the outset––and this is my third point––has striven for its constitutional effectuation. ^{Footnote 27} If a German court arbitrarily fails to meet its obligation to make a reference for a preliminary ruling, in the view of the Federal Constitutional Court this (also) infringes the guarantee of the lawful judge of Art. 101 sec. 1 sentence 2 of the Basic Law. The parties therefore have a right to have a matter decided under European law by the ecj. In case the obligation to refer a matter is handled in a manifestly untenable manner by a court, this may be challenged by means of a constitutional appeal before the Federal Constitutional Court.

This shows that the interaction of the Federal Constitutional Court with the Court of Justice is carried out in association. Thus, it was in following with its own stance that early last year, in the context of the ecb’s Outright Monetary Transactions (omt) programme, the Second Senate of the Federal Constitutional Court referred several questions to the Court of Justice for a preliminary ruling, for the first time in this Court’s history. ^{Footnote 28}

IV. Impulses for the development of the protection of fundamental rights

This brings me to another important juridification impulse. Even where the Federal Constitutional Court did set limits on the precedence of Union law, and on the surface of things thereby seemed to slow the process of legal integration, it ultimately promoted that process. Its case-law provided decisive impulses for the development of the protection of fundamental rights within the Union. The starting point was the Solange I decision of 1974, mentioned above. In this decision, the Federal Constitutional Court still restricted the precedence of Union law in cases where it was in conflict with the fundamental rights of the Basic Law. In this decision, the Federal Constitutional Court argued that Union law did not have a catalogue of fundamental rights equivalent to that of the Basic Law. ^{Footnote 29} On the basis of its own understanding as a citizens’ court, the Federal Constitutional Court’s aim was to strengthen the protection of fundamental rights as a basic element of the rule of law at the level of the European Union. ^{Footnote 30} The ecj accepted this challenge and, since the early 1970s, it has consistently elaborated a non-codified catalogue of fundamental rights, by invoking the constitutional traditions common to the Member States as well as the European Convention on Human Rights. ^{Footnote 31} Against this background, in 1986, the Federal Constitutional Court, in its Solange II decision, held that the condition set forth in the earlier Solange I decision had been fulfilled in substance. The Federal Constitutional Court now only exercises its jurisdiction when a level of protection essentially equivalent to that provided by the Basic Law cannot be ensured in Union law. ^{Footnote 32}

The ecj’s case-law on the Union’s fundamental rights, for its part, provided an important impulse for the elaboration of a catalogue of fundamental rights in the Charter of Fundamental Rights (the Charter), which entered into force on 1 December 2009.

Currently, the equilibrium of the system for the protection of fundamental rights threatens to become less stable. In its Åkerberg Fransson decision of 2013, the ecj interpreted a provision on the scope of the Charter (Art. 51 sec. 1 of the Charter) so broadly that practically any act by a Member State with any connection to Union law could be subject to its review of fundamental rights. ^{Footnote 33} Thereupon, the Federal Constitutional Court, in a judgment on the counter-terrorism database dated April 2013, warned that the Åkerberg decision was not to be understood and applied in such a way that the Charter of Fundamental Rights would be binding as soon as any connection in a provision’s subject-matter to the mere abstract scope of Union law could be established, or purely incidental effects on Union law could be made out. ^{Footnote 34} The aim of the Federal Constitutional Court, thereby, was also to maintain an effective protection of fundamental rights at the European level. For there is a risk that, due to a general shifting of the protection of fundamental rights from the national to the supranational level, a supposedly higher degree of protection is gained at the expense of accuracy and proximity to the cases. In “multipolar” fundamental rights relationships, in which several fundamental-rights positions must be balanced against one another, conflicts may also arise if the ecj finds that a fundamental-rights position of the Charter takes precedence over an opposing national fundamental right. ^{Footnote 35}

Irrespective of this, the following aspect should also not be neglected: the centralisation of the protection of fundamental rights in a single court would run counter to the concept of a federal legal community with shared responsibilities. It would potentially lead to uniformity in various legal matters, from data protection to insurance law to criminal law, which is not entirely compatible with the division of competences and therefore does not carry the support of the Member States’ will. Such “formalistic egalitarianism” ^{Footnote 36} through law narrows political margins of manœuvre and imposes itself upon a protection of fundamental rights in the Member States that is finely balanced and has evolved historically. ^{Footnote 37} All this can have a rather disintegrative effect and is therefore contrary to the objectives of the Union.

Against this backdrop, a merger of the spheres of fundamental rights, too, does not appear expedient. The proposal that the Federal Constitutional Court first examines a case under the fundamental law aspects of the Basic Law, but in doing so should, as regards the substance, converge upon the standards of the Charter of Fundamental Rights and the European Convention on Human Rights (echr) and, in case of conflict, give precedence to Union law, ^{Footnote 38} would only be acceptable if the ecj were to exercise a strongly restrained review, ^{Footnote 39} for which, in my view, there are however currently very few indications. ^{Footnote 40}

At the same time, the complexity of the protection of fundamental rights in the multi-level European system should not deter us. This also holds true with regard to the accession of the European Union to the echr as envisaged in Art. 6 sec. 2 teu, as a consequence of which legal acts and judgments of Union bodies would be subject to judicial review by the Strasbourg Court. In its opinion of 18 December 2014, ^{Footnote 41} however, the ecj came to the conclusion that the draft agreement on the accession of the European Union to the European Convention for the Protection of Human Rights and Fundamental Freedoms was not compatible with European primary law. ^{Footnote 42} The question of whether the ecj has rightfully been reproached in the legal literature for only wanting to thus secure its own prerogative of interpretation on questions of fundamental rights in the EU ^{Footnote 43} shall be left open here. What we can say is that the inclusion of a specialised international court on human rights would raise the overall legitimacy and credibility of the system of protection of human rights.

V. Securing the observance of the European integration agenda

Aside from the review of fundamental rights, the Federal Constitutional Court has developed two further instruments aimed at securing the agenda of European integration as agreed upon in the European Treaties: the identity review and the ultra vires review. ^{Footnote 44}

By means of the identity review, the Federal Constitutional Court examines whether the inalienable core of the Basic Law (Art. 23 sec. 1 sentence 3 in conjunction with Art. 79 sec. 3 of the Basic Law) has been respected. Art. 23 sec. 1 sentence 3 of the Basic Law expressly sets limits to the transfer of sovereign rights to the European Union. Accordingly, as mentioned, the fundamental structural principles of our state, such as the principle of democracy, the rule of law, the social welfare state, the republic, and federalism, may not be relinquished. The same applies to the guarantee of human dignity and those fundamental rights that are—to put it succinctly—part and parcel of human dignity. ^{Footnote 45} Here the following applies: that which is beyond the grasp of the constitution-amending legislature is also not open to integration. ^{Footnote 46} European legal acts that affect this inalienable core of the Constitution are not applicable in Germany. ^{Footnote 47} Thereby, integration and identity are mutually linked. They are two sides of the same coin; two values to be protected constitutionally and under Union law, the safe-guarding and furtherance of which go hand in hand. This follows not least from the EU-Treaty itself. Art. 4 sec. 2, sets forth: “The Union shall respect the equality of Member States before the Treaties as well as their national identities, inherent in their fundamental structures, political and constitutional, inclusive of regional and local self-government.” ^{Footnote 48}

The ultra vires review is to be distinguished from the identity review. The ultra vires review is based on the idea that the Union, unlike a state, may not generate its own competences. In Art. 5 sec. 2 sentence 1 teu, the Member States have obliged the Union institutions to respect the limits of the sovereign rights conferred upon them. A teleological application of the competence rules, guided primarily by the aim of the functionality and the efficiency of the Union and not subject to effective judicial review, ^{Footnote 49} runs the risk of undermining the contractually agreed integration agenda and thus ultimately the risk of turning its back on the law, which leads to disintegration. The ultra vires review is intended to limit the manifest overstepping of boundaries. ^{Footnote 50}

As early as its Maastricht judgment of 1993, the Federal Constitutional Court reserved its own jurisdiction to assess whether legal acts of the European institutions and bodies were either within those boundaries or outside them. ^{Footnote 51} In the Lisbon judgment of 2009, the Federal Constitutional Court, for the first time, spoke of an ultra vires review and restricted its exercise to a manner that is open towards European law. ^{Footnote 52} In the Honeywell decision of 6 July 2010, the Federal Constitutional Court further specified the requirement of openness to European law. It held firstly that before finding that an act is ultra vires, the ecj must be given the opportunity of interpreting the Treaty and ruling on the validity and the interpretation of the acts in question in proceedings for a preliminary ruling. ^{Footnote 53} Secondly, an ultra vires review only comes into play if there is a manifest overstepping of competences by the European institutions resulting in a structurally significant shift at the expense of the competences of the Member States. ^{Footnote 54}

The first time the Federal Constitutional Court agreed to hear such a matter was with regard to the decision of the European Central Bank’s (ecb’s) Governing Council to allow the purchase of government bonds of selected Member States without any limitation (known as the omt decision). ^{Footnote 55} As already mentioned, it referred the question to the ecj of whether the omt decision was compatible with the ecb’s monetary policy mandate (cf. Art. 119 and 127 et seq. tfeu) or if it violated the prohibition on monetary financing of the budget (cf. Art. 123 sec. 1 tfeu). In its judgment of 16 June 2015, ^{Footnote 56} the ecj answered these two referred questions in the negative; however, at the same time it emphasised that, contrary to the assumptions of the Member States and certain voices in legal doctrine, ^{Footnote 57} the acts of the ecb were also subject to judicially reviewable limits, and that the prohibition on the monetary financing of the budget in particular may not be circumvented. ^{Footnote 58} On this basis, the Second Senate of the Federal Constitutional Court must now render its final decision in the omt proceedings.

VI. The principle of openness to European law

As explained above, the review competences of the Federal Constitutional Court for safeguarding integration are limited to manifest exceptions. The reason for this is that the exercise of these competences is subject to the principle of openness to European law. The Federal Constitutional Court developed this principle in its Lisbon judgment. It derives from an overall view of the constitutional mandate for the realisation of a united Europe in Art. 23 sec. 1 of the Basic Law and the Preamble of the Basic Law. The principle of openness to European law can be seen as further proof of the Court’s pro-integration stance in its case-law. According to that stance, the Basic Law calls for participation in the European integration process and the international peace order. ^{Footnote 59} All constitutional organs must serve this principle, including the Federal Constitutional Court. It cannot yet entirely be foreseen how much directive power the postulate of openness to European law will have in individual cases. However, if one considers other general principles such as, for example, the effet utile—a method the ecj employs in the interpretation of Union law, in order to achieve the greatest possible level of practical effectiveness—one should not underestimate its influence. In any event, the principle of openness to European law is not simply a non-binding promise of goodwill in matters of European integration.

VII. The concept of responsibility with respect to integration

It should be more and more clear by now that governmental bodies, in implementing the idea of the legal community, are faced with a difficult balancing act. On the one hand, they are to further the integration process in accordance with the openness of the Basic Law to European law; on the other hand, they are to preserve the national constitutional identity. ^{Footnote 60} In order to avoid one-sided dynamics involving the risk that either Union law or national law is neglected, the Federal Constitutional Court strived to give effect to the concept of responsibility with respect to the European integration process in its Lisbon judgment. ^{Footnote 61} On that basis, responsibility with respect to integration signifies taking on lasting and sustainable responsibility in regard to European integration, first when transferring sovereign powers and developing the European decision-making procedures ^{Footnote 62} and, at a later stage, when dynamically developing the Treaty and its subsequent administrative implementation. ^{Footnote 63} In sum, this concerns the juridification of the process accompanying integration. Besides the institutions of the European Union, the responsibility with respect to integration is incumbent on the Member States and their constitutional bodies. ^{Footnote 64} In its order for reference in the omt case, the Federal Constitutional Court listed examples of the concrete requirements that might result from this. As a consequence of the responsibility with respect to integration, the Bundestag and the Federal Government are thus obliged to ensure the observance of the integration agenda. In cases of manifest and structurally significant overstepping of competences on the part of European institutions, these must not only refrain from acts of participation or implementation, but they must also actively work towards the observance of the integration agenda.

VIII. Strengthening the re-involvement of parliaments in European political decision-making processes

In particular since the onset of the sovereign debt crisis, strong forces are at work which, on the basis of the maxim “necessity knows no law,” seek to solve problems outside the scope of legal requirements, at a political level. ^{Footnote 65} Instead of transparent parliamentary procedures, short-term politically motivated crisis management by the executive quickly steps in and must take into account very diverse interests and constraints. In several decisions, the Federal Constitutional Court has therefore called for the democratic re-involvement of European political decision-making processes, and thereby strengthened the juridification of the integration. ^{Footnote 66}

Already in its Maastricht judgment of 1993, the Federal Constitutional Court pointed out that in the association of states of the European Union, democratic legitimisation necessarily also results from the involvement of the parliaments of the Member States in the acts of European institutions. ^{Footnote 67}

The decisions in the context of the sovereign debt crisis mainly concerned the securing of Parliament’s budgetary sovereignty. In its decision on aid for Greece and the Euro rescue package of September 2011, the Federal Constitutional Court found that a parliament must not relinquish its financial margin of manoeuvre. Therefore, the decision-making competence with regard to public revenue and public expenditure must remain with the German Bundestag. ^{Footnote 68} The right to decide on the budget is a central element of the democratic development of informed opinion. The Bundestag must specifically approve every large-scale measure of aid of the Federal Government taken in a spirit of solidarity and involving public expenditure on the international or European Union level. ^{Footnote 69}

The decision-making process may not be structured in a way that excludes a large part of the Members of Parliament from the exercise of the overall budgetary responsibility. The particular confidentiality or urgency of decisions, for example with regard to emergency measures for overcoming the sovereign debt crisis, does not justify the delegation of decision-making authority to subsidiary bodies. In a 2012 decision, the Federal Constitutional Court thus found that the delegation of authority to a special committee of the Bundestag, comprising nine members, was not justified. This committee had been delegated the authority to exercise, by way of exception, parliamentary participation rights in matters concerning the European Financial Stability Facility, the predecessor of the permanent rescue fund known as the European Stability Mechanism (esm). ^{Footnote 70} With regard to the esm, the Federal Constitutional Court, in September 2012, in a first step, largely rejected the requests for a temporary injunction aimed at prohibiting the Federal President from signing the German acts approving the esm Treaty. ^{Footnote 71} In a summary examination, the Court affirmed the constitutionality of the Act approving the esm Treaty. At the same time, the Court however did not simply “wave through” this rescue measure. For its ratification, the Federal Constitutional Court stipulated, among other things, the condition that, under international law, all payment obligations of the Federal Republic of Germany under this contract would have to be limited to the amount of approximately 190 billion euros; thereby no provision of the Treaty would be allowed to be interpreted in a way that established higher payment obligations for the Federal Republic of Germany without the consent of the German representative in the bodies of the esm. ^{Footnote 72} This also signifies that there can be no increase in the liability of the Federal Republic without the renewed approval of the Bundestag. At the same time, the Federal Constitutional Court held that the “Fiscal Compact”, which obliges the parties to introduce a debt brake, was compatible with the principle of democracy. In its decision in the principal proceedings on the esm Treaty and the Fiscal Compact of 18 March 2014, the Court followed the line set out in its preliminary ruling. ^{Footnote 73}

IX. Advance effects of the Federal Constitutional Court’s case-law

Particularly through the context of European rescue measures, a further significant juridification impulse of the decisions of the Federal Constitutional Court has come to light: the advance effects of its case-law. The fact that in the context of crisis management the esm Treaty and the Fiscal Compact were even possible constitutes a considerable success for the ideal of the law. In a most difficult situation, politics opted against informal ad hoc agreements and chose juridification and democratic re-involvement with regard to instruments dealing with the crisis. The speculation that the case-law of the Federal Constitutional Court on securing the budgetary sovereignty of the parliament may have promoted this process seems obvious to me if one takes a closer look at the different elements in the architecture of the stability mechanism. The esm Treaty, for example, in order to safeguard the overall budgetary responsibility of the national parliaments, stipulates a limit to the payment obligations of the Federal Republic and prescribes that, in key budgetary matters, decisions may not readily be taken against the vote of the representatives of large Member States that bear the main burden of the financial aid measures.

The obligation of the Member States, laid down in the Fiscal Compact, to submit a balanced budget and to introduce a national debt brake also borrows from the case-law of the Federal Constitutional Court. It aims at maintaining budgetary discipline and therefore takes account of the constitutional requirement to safeguard the parliaments’ budgetary sovereignty.

X. A realistic view of the law

The last point I would like to highlight in the present context is the Federal Constitutional Court’s realistic view of the law in its decisions with regard to integration. This view sharpens understanding of the drafting, the functioning and the deficits of the European Treaty. As a rule, crisis and conflicts constitute a litmus test for law. Therefore, the Federal Constitutional Court often thinks in terms of the “worst-case-scenario.” In the Maastricht judgment, for instance, it pointed out that the failure of the efforts to achieve stability might lead to fiscal concessions of the Member States with unforeseeable consequences throughout the European Union. ^{Footnote 74} In its Lisbon judgment, it found among other things that the basic democratic rule of equality in electoral franchise (“one man, one vote”) was not maintained at the European level, with consequences for the democratic legitimisation of decisions and their acceptance. ^{Footnote 75} In the esm decision, it ordered the Federal Government to close gaps with regard to debt limitation in the esm Treaty. ^{Footnote 76} In its order for reference to the ecj, it warned against circumventing the prohibition of monetary financing of the budget (Art. 123 sec. 1 tfeu). ^{Footnote 77} This list could be extended. Quite often these and other statements in the reasons have been perceived as “carping” and “anti-European”; as obviously lacking empathy for the European project and its institutions. It is said that already the entire style of the reasoning, regardless of the respective legal results, is steeped in such an attitude. And indeed, the “sound” of the decisions of the Federal Constitutional Court is, at first sight, not very engaging. The extensive and often very detailed statement of facts is followed by the complex process of deriving the standards to be applied from existing normative material and the Court’s own case-law with numerous distinctions and differentiations. ^{Footnote 78} This is followed by the application of the law to the specific case, which may appear to be rather technical. Whether this very dogmatic style ^{Footnote 79} is always sufficiently agreeable with other courts’ ways of reasoning and thinking, especially in European and international contexts, may be doubted in spite of the broad reception of the case-law of the Federal Constitutional Court. Conversely, one must caution against too affirmative a European rhetoric. It cannot be the task of the courts to—casually speaking—“put a positive spin on things”. Rather they shall contribute, by means of a realistic and sober analysis of the case to be decided, to strengthening the legal foundations of European integration.