The European Parliament is likely to take the European Commission to court for releasing over €10bn in funds for Hungary last December before an EU summit on Ukraine.
“EU funds should only be disbursed if the rule of law is guaranteed,” stated Daniel Freund, a German Green MEP and critic of Hungary’s government led by Viktor Orbán, in an email on Tuesday (12 March).
Freund added, “€10bn were released for Viktor Orbán without the necessary reforms being fulfilled. There are suspicions that the commission allowed itself to be blackmailed by Orbán.”
There are concerns that the commission may release more funds based on questionable reasons.
Valérie Hayer, chair of the liberal Renew Europe, demanded transparency from the commission before any further funds are unblocked.
The commission asserts that Hungary provided evidence of the independence of its judiciary.
“The commission believes it acted in accordance with EU law and will defend its decision in EU courts,” said a commission spokesperson.
In recent years, Hungary has seen a decline in democracy, with the commission using EU funds as leverage for Budapest to improve its governance.
However, Hungary obtained a major concession ahead of the EU summit in December amidst threats by Orbán to block EU funds needed to support Ukraine against Russia’s invasion.
Funds for Hungary are currently suspended under three regulations, with Hungary needing to meet conditions under each to receive the money.
The €10bn released in December falls under the common provisions regulation (CPR), making Hungary eligible for union funds governed by the CPR.
Burden of proof
To win the case at the European Court of Justice (ECJ), the European Parliament must prove that the commission made errors in applying the CPR and assessing conditions related to judicial independence in Hungary.
The regulation lacks clarity on criteria assessment and procedures, with no established case law, posing legal challenges.
“The commission has discretion in managing EU funds,” said Rene Repasi, a German Socialists & Democrats MEP.
If the parliament loses the case, Repasi stated that legislators will need to tighten criteria for withholding cohesion funds to protect the rule of law and EU’s financial interests.
The decision to take the commission to court was made in a 16-to-1 vote in the parliament’s legal affairs committee on Monday.
Approval is required from political group leaders in a meeting scheduled for Thursday, followed by confirmation from parliament president, Roberta Metsola.
About €20bn in EU funds for Hungary remain blocked, including funds under the rule-of-law conditionality mechanism, Recovery and Resilience Facility (RRF), REPowerEU, and cohesion funds.
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