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Europe

European Commission Makes Good on Legal Threats

The European Commission has filed a lawsuit with the European Court of Justice against the decision taken by EU finance ministers in November not to punish Germany and France over their budget deficits.

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It's up to the judges now.

The European Commission took legal steps on Wednesday to clarify the legal basis for the EU finance ministers' decision in November to abandon disciplinary action against France and Germany for breaking the Stability and Growth Pact.

The Commission, the European Union’s executive arm, filed a lawsuit at the European Court of Justice, the EU's highest court, against the decision taken by EU finance ministers to suspend the budget rules underpinning the euro after Berlin and France announced that they would breach the pact on public deficits, which stands at three percent of gross domestic product for euro zone countries, for the third year running.

"We have received by fax the request of the Commission this morning. It is being recorded by the court clerks," said a spokeswoman for the European Court of Justice in a statement reproduced by the EU Business Web site.

The Commission has reportedly demanded that the court use a fast-track procedure for the case so that a judgment can be delivered in three to six months, rather than two years.

Member states oppose Commission decision

The decision by the Commission has united many of the EU member states, including most of the four countries that opposed the November decision -- Austria, Finland, the Netherlands and Spain -- who have largely closed ranks over the issue to oppose the lawsuit. Many countries have called the timing of the lawsuit into question. The EU is preparing for its enlargement to 25 countries in May while battling over the proposed EU constitution and launching talks on its medium-term budget plans. However, the Commission has defended its decision, saying that it is its "duty" to uphold the rules.

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