I have come across a discussion on housepricecrash which suggests that Article 122 of The Lisbon Treaty could not be used to enforce a Greek bail-out. The argument was made that this Article only applies if the nation state is experiencing severe problems with supply of ‘certain products’, notably energy.
And yet the Article also says ‘measures appropriate to the economic situation’. Here is the ‘offending’ Article.
1. Without prejudice to any other procedures provided for in the Treaties, the Council, on a
proposal from the Commission, may decide, in a spirit of solidarity between Member States,
upon the measures appropriate to the economic situation, in particular if severe difficulties arise
in the supply of certain products, notably in the area of energy.
2. Where a Member State is in difficulties or is seriously threatened with severe difficulties
caused by natural disasters or exceptional occurrences beyond its control, the Council, on a
proposal from the Commission, may grant, under certain conditions, Union financial assistance
to the Member State concerned. The President of the Council shall inform the European
Parliament of the decision taken.
I was criticised for not publishing the Article in full yesterday.
What I should have done was post the link to the original post on this topic, where I gave the sources for Article 122 being the legal justification for the Greek bail-out. Here is the LINK. There is no doubt that Article 122 is being proposed as the means for a Greek bail-out. I apologise to readers for not making the link yesterday.
I am sure a brief power cut could be arranged easily enough, if this has to be a text book operation. The threat is real enough, and not something I’ve fabricated to stir up ‘anything’, as one commenter suggested.
Original Report From Open Europe
UK could face £7bn bill if the EU bails out Greece;
Anatole Kaletsky: The eurozone will be tested to “near-destruction”
The Mail on Sunday reported that if an EU rescue fund for the troubled Greek economy matched the country’s budget deficit, the UK would be asked for £7billion, assuming contributions matched each country’s share of the total EU economy. The article noted that, until now, discussion has focused on whether fellow eurozone members could be asked to bail out Greece.
But under Article 122 of the EU Treaty, all EU members could be liable. The Treaty article says: “Where a member state is in difficulties or is seriously threatened with severe difficulties caused by natural disasters or exceptional occurrences beyond its control, the council of ministers, on a proposal from the European Commission, may grant, under certain conditions, Union financial assistance.”
The paper reported that the EU Council decision would be made on a majority vote with Britain having no veto. If other troubled eurozone members such as Ireland or Spain were excused from making a contribution, Britain’s share could be even larger. A Treasury source would not comment on whether any official calculations have been made regarding Britain’s potential exposure.
This is why Darling was stating that the Greek bailout should not be Britain’s responsibility yesterday. Because it easily could become our responsibility under Article 122. And not just Greece but any other EU country. I wonder if Gordon Brown knew when he signed it. I doubt he, or Lord Moneybags (above) even cared, let alone Cherie Antoinette, his most patriotic Consort. Where’s that guillotine?