German court rejects challenge to eurozone bailouts

[Gerald]

The BBC's Gavin Hewitt said the ruling will limit Chancellor Angela Merkel's ability to make an immediate response to a crisis in the future.

Germany's highest court has rejected a challenge to the country bailing out other nations in the eurozone.

The Constitutional Court was responding to a challenge brought by six prominent German Eurosceptics.

But the court did say the government must seek the approval of the German parliament before providing future assistance.

This could further hinder Europe's response to the debt crisis, already criticised as too slow.

German Chancellor Angela Merkel said the high court's decision vindicated her government and said that the existence of the euro meant more than just a common currency.

"The euro is the guarantor of a unified Europe," she told lawmakers. "If the euro collapses, Europe collapses."

'Not blank cheque'

As Europe's largest and most robust economy, the German decision has implications for the whole region.

The presiding judge, Andreas Vosskuhle, said German lawmakers should be more involved in future bailout decisions.

"The government is obligated in the cases of large expenditures to get the approval of the parliamentary budgetary committee," Mr Vosskuhle said.

But it was not a "blank cheque for additional rescue packages," he added.

http://www.bbc.co.uk/news/business-14817440


Note: 7 September 2011 Last updated at 10:21 GMT