Court rules Arco settlement unconstitutional


The Constitutional Court has found the guarantee that protected only some investors in the defunct Dexia bank in breach of the constitution

‘Uncertainty has gone on long enough’

A government guarantee created by the former prime minister Yves Leterme to protect the savings of members of the Arco organisation is in breach of the constitution, according to a ruling of the Constitutional Court.

The ruling is seen as a victory for a group of ordinary shareholders at the defunct Dexia bank, who lost their investments, while Arco members saw theirs partially protected by the guarantee.

Arco was the investment wing of the Christian democrat ACW movement, which now goes by the name When Dexia collapsed in 2011, wiping out the investments of many shareholders, including Arco members, the government led by Leterme – a Christian democrat closely affiliated with the ACW – extended the government guarantee, which exists for holders of savings accounts, to 80,000 Arco investors.

According to the Constitutional Court, the guarantee was aimed at one specific group of people, which means it is discriminatory under the Constitution. The verdict has been anticipated for some time. The Court had previously sent a number of questions to the European Court of Justice for clarification and was told at the end of last year that the guarantee was in breach of EU laws.

Federal finance minister Johan Van Overtveldt (N-VA) said that because the ruling had only just been issued, it was being studied by the ministry. “The first signs are that this is in line with what the European Court of Justice had  decided,” he said. “We will have to be very careful when we come up with possible solutions that could be applied to this case. Anything that comes to the table will have to be legally watertight. The uncertainty has gone on long enough.”