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EU court ruling paves way for Brussels to take action against Hungary and Poland

The EU’s highest court has rejected Poland and Hungary’s legal challenge to the bloc’s rules, opening the way for Brussels to withhold funding from member states over violations. rule of law.

The European Court of Justice found that the new conditional rule of law, which protects the EU budget from violations by member states, is legally sound and compatible with treaties. alliance treaty. The decision will allow the European Commission to start proceedings within weeks, leading to the imposition of penalties.

Wednesday’s ruling is the latest development in a landscape that has become increasingly difficult for the rule of law. The EU is mired in numerous disputes with member states over respecting its founding principles including judicial independence.

The conditions mechanism was agreed to by the EU in 2020 as part of a budget deal that brought in the bloc’s 800 billion euro coronavirus recovery fund. Poland and Hungary have challenged the legislation in EU courts, demanding that the rules be annulled on the basis that they are incompatible with the treaty and violate the principles of legal certainty.

The mechanism allows the commission to withhold EU funding as needed to protect it from abuse by breaking the law. EU officials have reviewed cases against several member states over the past year, but Hungary and Poland are seen as the most likely initial targets.

On Wednesday, the ECJ said it “rejects all actions taken by Hungary and Poland”. The new law, it found, “particularly respects the limits of powers vested in the European Union and the principle of legal certainty”.

Ursula von der Leyen, chair of the committee, said officials will analyze the court’s decision before adopting guidelines in the coming weeks on how to apply the mechanism in practice. She added that the committee is assessing a number of cases “in-depth” and will “act with determination” when the conditions in the regulation are met.

But it will come under great pressure from the European parliament to act within weeks. Roberta Metsola, president of the European parliament, said the council expected the commission to adopt the rules “quickly”.

In Brussels, Hungary is seen as the most obvious case for action. Budapest is in peril because weaknesses in its procurement rules have raised concerns about corruption related to the dispersion of EU funds.

The main concerns regarding Poland revolved around the independence of the judiciary and about the disciplinary chamber for judges, which the ECJ found to be illegal. Poland’s constitutional court in October intensified its dispute with the EU over judicial values ​​after finding that parts of EU law were incompatible with the country’s constitution.

Committee out their concerns in unofficial letters to Budapest and Warsaw in November, in a preliminary step that points the way to formal action after the ECJ’s ruling is delivered.

Any commission action will come at a delicate time. Hungary holds elections in April and Brussels is wary of waging an open funding battle with prime minister Viktor Orban as the campaign heats up.

“The ECJ has become a political agent,” Hungarian Justice Minister Judit Varga said on Wednesday. “We have had long discussions with Brussels but this is a new level.”

Orban said in a statement on Saturday that Brussels is using the rule of law as “a tool with which they can mold us into their image”. He added: “Now they are fighting. . . a holy war of the rule of law. ”

Poland has been implementing decisions aimed at its dispute resolution with the EU on judicial independence. President Andrzej Duda this month introduced a bill to amend the disciplinary system for judges, and the ruling Justice and Law party later launched its own idea.

“The court decision is very clear: the rule of law is legal and ready to be applied by the European Commission,” said Katalin Cseh, a Hungarian MEP from the group Innovation Free Europe. “The commission won’t waste a second time anymore, and let’s apply the mechanism.”

Additional reporting from Marton Dunai in Budapest

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