The Principle of Proportionality and the European Central Bank

The principle of proportionality is a general principle of EU law which applies to the European Central Bank (ECB) in the fields both of monetary policy and banking supervision. In recent years, the issue of the proportionality of the ECB's action has been at the centre of extensive debate in European legal doctrine and jurisprudence. This article aims to contribute to this debate by providing a comprehensive analysis of the meaning and implications of the principle of proportionality in the field of banking supervision and monetary policy. The article is divided into four parts. Parts I gives a general overview of the origin of the principle and its subsequent developments in light of the case-law of the European Court of Justice. It also reflects on the different meanings of proportionality as a flexible and multi-faceted principle. Part II investigates the principle of proportionality according to an ex ante perspective, i.e. as a principle capable of governing and orienting legislative and administrative action. Under this perspective, the article analyses the way proportionality impacts banking regulation, banking supervision and monetary policy. Part III deals with the ex post perspective, i.e. the way proportionality is assessed and scrutinized by EU courts. Part IV concludes. Part III and IV will be published in the next issue.