I would rather say that the term “sovereignty” is multifaceted. We have the concept of popular sovereignty, which means that political power emanates from the people and all other sovereignty is delegated.

However, there is also a use of the term “sovereignty” in the sense of self-determination over one's own state structure and the ability to ward off external interference. When a state transfers certain sovereign rights to the EU, this is more than just delegation. In German constitutional law, for example, this means that the transfer of such rights to the EU has constitutional status.

If there is a lawsuit before the German Federal Constitutional Court (Bundesverfassungsgericht) that challanges an EU law or regulation, the court first examines whether the EU law in question regulates something that actually falls within the EU's area of responsibility or whether it is something over which Germany has reserved its sovereignty.

The most prominent example of such a ruling is the PSPP (Public Sector Purchase Programme) case from 2020, where the German Federal Constitutional Court ruled that another ruling from the Court of Justice of the European Union (CJEU) regarding the European Central Bank (ECB) program of purchasing government bonds is not binding in Germany because the CJEU exceed its judicial mandate and violated the sovereignty of the German Bundestag. The case was "solved" when the European Central Bank provided the Bundestag with additional documentation regarding the program and the Bundestag concluded that everything is in order.

For the decision of the German Federal Constitutional Court see: https://www.bundesverfassungsgericht.de/SharedDocs/Pressemit... (in English)

In this decision the term "sovereignty" is explicitly used to outline the case: "In particular, these [complaints] concerned the prohibition of monetary financing of Member State budgets, the monetary policy mandate of the ECB, and a potential encroachment upon the Members States’ competences and sovereignty in budget matters."

The decision later concludes:

"This standard of review [in the ruling of the CJEU] is by no means conducive to restricting the scope of the competences conferred upon the ECB, which are limited to monetary policy. Rather, it allows the ECB to gradually expand its competences on its own authority; at the very least, it largely or completely exempts such action on the part of the ECB from judicial review. Yet for safeguarding the principle of democracy und upholding the legal bases of the European Union, it is imperative that the division of competences be respected."