Hungary, Poland refer controversial rule of law mechanism to court

Flag of Poland and Hungary and the sign of the Court of Justice of the European Union at the European Court of Justice (ECJ). [Shutterstock/Aritra Deb]

Hungary and Poland have launched legal action at the European Court of Justice (EJC) against the regulation tying the disbursement of bloc funds to the rule of law situation in EU countries, the court said on Thursday (11 March).

The so-called conditionality mechanism linking funds to the rule of law posed a major hurdle in the wider negotiations on the bloc’s historic €1.8 trillion budget at the end of last year. 

The European Parliament and the Council representing the EU27 eventually hammered out a compromise under which Hungary and Poland agreed to stop blocking the budget.

Though the text of the regulation remained largely unchanged, December’s compromise deal included a promise by the European Commission that it would not activate the procedure against any country until it had put guidelines in place governing its use.

Under the deal, the ECJ, the bloc’s highest court, must also first rule on whether the mechanism falls foul of EU treaties.

EU leaders unlock historic €1.8 trillion budget deal

EU leaders accepted on Thursday (10 December) the compromise reached between Germany and Hungary and Poland to unblock the EU budget package totalling €1.8 trillion, after the European Commission clarified that the Rule of Law mechanism will be valid from 1 January.


Meanwhile, many European lawmakers fear a long delay to the activation of mechanism, which first came into force on 1 January 2021 and now might not be implemented until after the Hungarian elections in 2022.

Frustrated MEPs also criticise the Commission for pledging not to implement the regulation until the court rules on the matter, the outcome of which the EU executive has said it will incorporate into its guidelines.

To speed the process along, the European Parliament has promised to ask the judges in Luxembourg to follow an expedited procedure, with hopes the judgement would be announced in May.

EU institutions strike budget deal on rule of law mechanism

The European Parliament and the Council representing the EU27 reached a preliminary deal on linking the disbursement of EU funds to rule of law after five rounds of talks, clearing a major hurdle in the wider negotiations on the bloc’s budget.

Some MEPs suggest bringing a separate case against the European Commission over what they say is its failure to act and apply the regulation.

The European Parliament will “make sure that the political and legal measures at our disposal are used if the Commission does not act rapidly on Poland and Hungary, and that includes legal action for the failure to act under Article 265 of the treaty,” said Dutch MEP Lara Wolters during a debate on the subject on Thursday.

“But I urge the Commission not to let it come to that, because if it takes its instructions from individual governments rather than from jointly agreed European law, then of course it contributes to the very problem that it should now be fighting: the erosion of the rule of law in Europe,” she added.

However, critics say that the European Parliament also failed to fulfil its duties when it decided not to challenge the European Council compromise deal in December.

“The EU Parliament has limited tools to enforce the rule of law and it accepted not to defend its (limited) prerogatives when it gave up on its change to challenge European Council December conclusions,” EU law scholar Alberto Alemanno wrote on Twitter.

[Edited by Josie Le Blond]

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