The European Court of Justice has dismissed a Polish and Hungarian challenge to a new law that would allow the EU to cut funds to member countries that violate democratic rights and freedoms.
The final ruling by the Luxembourg-based European Court of Justice marks a milestone in the EU’s long-standing challenge with Poland and Hungary’s populist rulers over undercutting the rule of law.
“The full court dismisses the action (by Hungary and Poland),” the court said. In its final statement, the Court noted that compliance by the Member States with the common values on which the European Union is founded – which have been identified and are shared by the Member States and which define the very identity of the European Union as a legal order common to those States – four such as the rule of law and solidarity, justifies the mutual trust between those States. Since that compliance is a condition for the enjoyment of all the rights deriving from the application of the Treaties to a Member State, the European Union must be able to defend those values, within the limits of its powers.”
Referring directly to the “conditionality mechanism”, which makes receipt of financing from the Union budget subject to the respect by a Member State for the principles of the rule of law, the Court argued that such mechanism is capable of falling within the power conferred by the Treaties on the European Union to establish “financial rules” relating to the implementation
of the Union budget.
Thirty-six billion euros in pandemic recovery funds earmarked for Poland, and 7 billion euros for Hungary, are already frozen over their track record on democratic rights and values.
Updated 1055: President Roberta Metsola welcomes decision
European Parliament President Metsola said: “The European Parliament now expects the Commission to apply the conditionality mechanism swiftly. Conditionality of EU funds linked to respect of the rule of law is non-negotiable for the European Parliament. “The rule of law is the basis on which our Treaties are built. It is fundamental that all Member States adhere to the Treaties they all signed up to when they joined the European Union. Values matter, and citizens have the right to know how common funds are used”, underlined President Metsola.”
The regulation, strongly supported by the European Parliament, was adopted in December 2020. Following parliamentary resolutions, the European Parliament submitted in October 2021 a lawsuit to the Court of Justice against the European Commission for its failure to apply the Conditionality Regulation.
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Updated 1151: MEPs say Commission must act now
In a press briefing following the landmark ECJ ruling, four MEPs from across political lines insisted that while this Court judgement came to no surprise, this decision has taken away the last ‘excuse’ for the conditionality mechanism not to be used.
Hungarian MEP, Katalin Cesh, Vice-Chair of the Renew Europe Group, said that Hungary cannot keep evading consequences any longer. “Actions are long overdue – European citizens are waiting for actions”. She said that Hungarian citizens themselves want the EU to support them, they recognise that the rule of law is under duress and want the European institutions to protect them.
“EU taxpayer money needs to be protected”, Cesh added, while arguing that this ruling is not just about Hungary or Poland, but a deterrent to all Member States.
Daniel Freund (Greens) said that even if the Commission acts now, the process would take a minimum of nine months to complete.
The MEPs also expressed disappointment at the Commission President’s first reaction, which simply welcomed the Court’s decision: “I do not feel that the Commission President’s statement signals immediate action. This is utter disregard to the people on the ground suffering from the rule of law violations” the MEP added.
“None of us want sanctions, we want a functioning rule of law. This is not a political fight but a fight against corruption. This mechanism is conceived as a tool to push governments towards a stronger fight against corruption and independent judiciary”, Freund argued.
Eider Gardiazabal Rubial (S&D) echoed these sentiments, saying that this judgement was not surprising, but the process cannot be delayed any longer. “The regulation has been in place for fourteen months, this is way too long. The Commission must have all the information at hand, they have to examine carefully the judgement, but it must be ready to act as soon as possible.”
Qeustioned on priorities, MEP Petri SARVAMAA (EPP) said that the Commission was ready to act before, but for political reasons it was stopped. He argued that the case against Hungary was stronger, given reports of conflicts of interest and corruption. For Poland, the issue was the independence of the judiciary, making it harder to authorities to build their case, he explained.
The European Parliament will be debating the Court’s decision in plenary later today.
PHOTO – (FILE) – The European Court of Justice’s (ECJ) entrance in Luxembourg. EPA-EFE/NICOLAS BOUVY
