Reflections on the Greek Capital Controls: How the Rescue of the National Economy Justifies Restricting Private Business

Abstract:

The Greek capital controls of June 2015 were not limited to cash withdrawals, they also introduced restrictions on international transactions, which caused serious trouble to Greek businesses trading cross-border.

Investigating the justification of these restrictions in the Greek context, but also in comparison with developments in other South European Member States, especially in Cyprus, this article first examines the special legislative process by which the capital controls were enacted. The main focus is on the EU substantive requirements for the protection of free movement of capital and payments among Member States and beyond: non-discrimination and proportionality.

The conclusion reached is that the Greek measures can be justified because they served the superior public interest in the protection of the financial and economic system.