Germany's Constitutional Court has rejected a series of legal challenges aimed at blocking Germany's participation in bail-out packages for Greece and other euro zone countries.
But the court said the country's parliament must have a bigger say in future rescues.
The country's highest court in Karlsruhe said the German government must seek the approval of parliament's budget committee before granting such aid, a requirement which could further slow down Europe's response to the debt crisis.
In addition, the court ruled that parliament must have "sufficient influence" over the conditions attached to future rescue deals. This could limit Chancellor Angela Merkel's room for manoeuvre if new crises blow up.
It may not approve deals that could lead to an unforeseeable burden on future parliaments, the court also ruled. The judges also insisted that parliament may not approve any deal that leads to a pooling of national debt, apparently ruling out the idea of "eurobonds."
The complaint was taken by a politician and academics who argue the Berlin government's bail-out decisions violated treaties governing the euro and German law on democracy.
Merkel says ruling confirms German euro policy
German Chancellor Angela Merkel said today's court ruling confirmed Berlin's policies during the debt crisis.
''This is what the Constitutional Court confirmed without a doubt: responsibility for one's actions and solidarity - solidarity and a transparent, open way of operating, of course with the co-determination of the parliament," she told deputies. "That is exactly the road we have taken."
Merkel appeared relieved by the court decision. She hit out at critics who said that Germany, the paymaster for the euro zone aid packages, had been too hesitant in the crisis and too strict in its demands for austerity from recipient countries.
"Sweeping all the problems under the carpet and talking about solidarity won't bring us stability," she said, renewing a call for debt-mired states to implement structural reforms. "The problems of a single country can imperil the currency. That is why I say we need more Europe", she added.
Merkel said this must include stricter enforcement of the European stability and growth pact including consequences for states that breach public deficit limits.
EU welcomes German court's backing of bail-outs
The European Commission welcomed today the German constitutional court's decision to uphold euro zone bail-outs, saying the ruling has an important impact on efforts to overcome the debt crisis.
''The commission has taken note with satisfaction of the constitutional court ruling on legality of the financial assistance for Greece and other measures,'' said commission spokeswoman Pia Ahrenkilde Hansen.
''This ruling confirms the compatibility with the German constitution with measures taken so far in this context," she told a news briefing. "It has an important bearing on the capacity of the Union and of its member states to act, to surmount the sovereign debt crisis affecting certain member states," the spokeswoman said.
Germany's top court ruled that aid for Greece and rescues for other euro zone countries is legal, but it also stressed that the German parliament must have greater say in any future bail-outs.
"It is now up to the German government and parliament to take this ruling into account," Ahrenkilde Hansen said.
"We fully respect and have utmost confidence in Germany's democratic institutions and have no doubt whatsoever that they will be able to comply with this ruling, while indeed maintaining their capacity to act effectively and decisively,'' she added.
