Hungary’s Orban threatens EU budget veto over rule-of-law

File photo. Hungarian Prime Minister Viktor Orban (C) and Belgium's Prime Minister Charles Michel (R) during an Informal Summit of Heads of State or Government of the EU countries in Sibiu, Romania, 9 May 2019. [Pool/EPA/EFE]

Hungarian Prime Minister Viktor Orbán has threatened to veto an EU accord linking the bloc’s long-term budget to a mechanism requiring countries to uphold Europe’s democracy rules, according to an EU source on Sunday (8 November).

The European Council said Thursday that “provisional agreement” had been reached between Germany, which holds the rotating EU presidency, and the European Parliament over the seven-year 1.1-trillion-euro budget as well as a €750-billion virus relief package.

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.

But according to Hungarian news-site, Orbán threatened to veto the package in a letter sent to the German presidency and other European leaders if the payment of budgetary funds to member states is subject to rule-of-law conditionality.

“Although Hungary is committed to cooperation, in the light of developments, it cannot provide the unanimity required for the package adopted in July,” said the letter, sent to EU Commission President Ursula von der Leyen and Charles Michel, president of the European Council.

The Hungarian government did not reply to a request by AFP for comment.

A European source told AFP that both Michel and von der Leyen had received the letter, as had Germany — which currently holds the bloc’s rotating presidency — and Portugal, which takes over the presidency in January.

In the letter, Orbán explained “that he cannot give his agreement to the compromise on conditionality, because it doesn’t correspond to the package agreed in July,” the EU source said.

In July, EU leaders consented to the principle of rule of law conditionality when they held a marathon summit that agreed the bloc’s unprecedented virus bail-out package of grants and loans.

But MEPs complained that the provision was too vague to ensure that EU countries receiving bloc cash abided by democratic rules — something fiercely opposed by Hungary and Poland.

Those two member states have come in for scathing criticism from Brussels for moves seen to erode judicial independence and undermine rules on migration.

In a statement Thursday, the European Council said the agreed mechanism “allows to protect the EU budget where it is established that breaches of the principles of the rule of law in a member state affect or seriously risk affecting the sound financial management of the EU budget or the protection of the financial interests of the EU in a sufficiently direct way”.

But according to, Orbán said the accord’s “proposed sanction mechanism is based on legally vague definitions such as ‘violation of the rule of law'”.

“Such difficult-to-define concepts create opportunities for political abuses and violate the requirement of legal certainty,” he said.

“If this remains the case, the Hungarian government has no choice but to reject the other elements of the July package,” he added.

Germany had been irked by the European Parliament holding firm on the issue when the virus relief package urgently needed to be unblocked, especially with a second wave of the coronavirus sweeping Europe.

Its officials negotiated with the MEPs on behalf of the 27 member states to reach Thursday’s agreement.

“We have a historic 1.8-trillion-euro financial package on the table. With the second wave of the pandemic hitting member states hard, there is no time to lose,” said Germany’s envoy Michael Clauss.

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