German drive to strip voting rights divides EU

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A controversial German drive to remove voting rights from European Union states that break new budget rules divided leaders at a bloc sumit on Friday.

The principled Berlin push, backed by France in a joint declaration issued in Deauville last week, was one of three key conditions laid down by Chancellor Angela Merkel in exchange for signing up to a permanent EU rescue fund for overly-indebted states.

"I am happy the subject remains on our agenda," said Merkel as she returned to the conference room following seven hours of bruising talks Thursday.

She had won the day with her insistence that the EU's Lisbon treaty must be rewritten, and that banks must shoulder the burden of state failure in the design of a fund that takes shape next year.

"When a country fundamentally breaches eurozone stability repeatedly, its ability to participate in decision-making should be able to be restricted," she said.

However, Luxembourg Prime Minister Jean-Claude Juncker, who heads the Eurogroup of finance ministers, interpreted the outcome on the voting rights question differenty.

"I am very pleased that the question of voting rights is no longer pressing," he said.

Juncker said that a declaration on the question to be issued by EU president Herman Van Rompuy at the close of the two-day EU summit "shows that there is no agreement on this point."

The text, which restricts possible scope to extreme scenarios, says Van Rompuy will "subsequently examine in consultation with the member states the issue of the right of euro area members to participate in decision making... in the case of a permanent threat to the stability of the euro area as a whole."

Pressed on the date, given a December summit will take a "final" decision on the vexed issue of changing the treaty, Van Rompuy said only that voting rights would be examined at a later date.

© 2010 AFP

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