Seite - 156 - in Austrian Law Journal, Band 2/2018

ALJ 2018 Hannes Hofmeister 156 Member State are equal to the number of shares allocated to it in the authorised capital stock of the EMF.95 Hence, large States, such as Germany hold 27% of all votes while smaller states, such as Austria, are only allocated 3% of the votes. Pursuant to Article 5(7) of the draft Statute, the Board of Governors shall take the following decisions by reinforced qualified majority: (…) (a) provide stability support to EMF Members, including the policy conditions as stated in the memorandum of understanding referred to in Article 13(3), and to establish the choice of instruments and the financial terms and conditions, in accordance with Articles 14 to 18; (b) request the Commission to negotiate, in liaison with the ECB, the economic policy conditions attached to each financial assistance, in accordance with Article 13(3); (c) change the pricing policy and pricing guideline for financial assistance, in accordance with Article 20; In other words, fundamental decisions by the EMF, such as the provision of stability support, no longer require a unanimous vote (as was the case under the old Article 5(6)(f) ESMT); rather a reinforced qualified majority will suffice in the future. The same is true for the decision to request the Commission to negotiate the economic policy conditions attached to each financial assistance, as well as for the decision to change the pricing policy for financial assistance.96 So does this amount to a major innovation enhancing the efficiency of the mechanism? We must not forget that even under the old system these decisions could be taken by a qualified majority of 85%. However, this was only possible under exceptional circumstances (‘emergency situations’): When both the Commission and the ECB had concluded that a failure to urgently adopt a decision to grant financial assistance would threaten the economic and financial sustainability of the euro area, then the emergency voting procedure could be used. What used to be the exception (85% threshold) now becomes the rule. This will affect small states more negatively, as they can now be outvoted. Big states, such as Germany with a 27% share of all votes, retain their veto right, at least prima facie. On closer examination, it turns out that they, too, will lose their veto right in case the new emergency procedure applies.97 This new procedure is codified in Articles 3(2) and (4), which provide: (2) Where circumstances require the urgent provision of stability support to an EMF Member in accordance with Article 16, decisions may be taken by an emergency procedure. In such an event, the decision taken by the Board of Governors or the Board of Directors shall be transmitted to the Council immediately after its adoption together with the reasons on which it is based. Upon request of the Chairperson, the Council shall discuss the decision, within 24 hours of its transmission. The Council may object to the decision. In the event of an objection, the Council may itself adopt another decision on the matter, or refer the matter back to the Board of Governors for another decision. 95 Article 4 of the Draft Statute of the EMF, supra note 55, at 3. 96 See Article 5(7)(b)-(c) of the Draft Statute of the EMF supra note 55, at 3. 97 An interesting question that arises in this context is who will decide that an emergency situation does exist. In contrast to the ESMT, the draft does not specify this.