The “Fiscal Compact”: legal uncertainty and political ambiguity
An intergovernmental treaty which should foster “stability, coordination and governance” in the Economic and Monetary Union is about to be signed. Renaud Dehousse shows in his Policy Brief that both nature and content of the treaty provoke legal uncertainty and political ambiguity in terms of the coexistence with the existing treaties, the provisions on excessive deficits, and the role of the Court of Justice of the European Union.
The so-called “Fiscal Compact Treaty” attempts to deal with the structural weaknesses of the Economic and Monetary Union. While member states are free to conclude an intergovernmental treaty, such a treaty may not be in conflict with existing rules in the legal framework of the European Union. This concerns the European Union treaties as well as legislation like the “Six-Pack” on economic governance.