Support Mechanisms Pose Fundamental Legal Questions

Publication: Policy Letter No. 05, 2012
Topic Area: Macro and Finance
Authors: Helmut Siekmann
Date: Feb 2012
Keywords: sovereign debt crisis, ESM, EFSF, new fiscal compact

After initial temporary measures in support of Greece prooved insufficient to end the sovereign debt crisis, extensive countermeasures have ensued. The heads of state of the euro group have agreed to permanent support mechanims over the course of the past two years. In addition, the European Central Bank (ECB) has become involved in the assistance program. The article provides an overview of the various support mechanisms installed and cautions against the connected legal problems.

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