Barroso warns Hungary it needs to comply with EU laws

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The European Union will make sure that Hungary complies with all the bloc’s laws, the head of the bloc’s executive promised on Thursday. Hungary’s conservative government is under fire for a series of new laws and constitutional amendments which critics say unduly concentrate powers on a range of matters – from finances to election law – with the administration.

‘Some of that legislation may indeed by in violation of European laws and European principles,’ European Commission President Jose Manuel Barroso said in Copenhagen. ‘So we will use all our power to make sure that Hungary complies with the principles and values and the rules of the European Union, and I am confident that we will achieve that,’ he added.

Danish Prime Minister Helle Thorning-Schmidt, who hosted Barroso, and whose country hold the EU’s rotating presidency, chose to remain silent on the Hungarian issue.

On Wednesday, the commission postponed to next week its final response on whether Hungary’s laws – notably one that seems to affect the independence of the central bank – breach EU norms.

Euro zone leaders agreed in December to push forward by one year the launch of their permanent bailout fund, the 500 billion euro European Stability Mechanism (ESM), which is to replace the temporary 440 billion euro European Financial Stability Facility (EFSF) in July 2012, rather than 2013.

They also agreed to discuss in March whether to keep a cap of 500 billion euros for the maximum lending capacity of the combined EFSF and ESM, as they run in parallel for a year.

If this cap were removed, the combined bailout capacity of the euro zone would reach 1 trillion euros.

But Germany, the euro zone’s biggest economy and contributor to both funds, is opposed to removing the limit on the combined lending capacity of the EFSF and ESM.

“Yes, more has to be done also in terms of firewalls,” Barroso told a news conference. “The question is how far member states are willing to go,” he said, stressing the Commission was in favour of more firepower for the euro zone bailout capacity.

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