The German Presidency prepared a four-page document calling on Member States to adopt a common position on the rule of law mechanism. This will be possible at the next EU summits on Thursday and Friday, all we know is that the governments of Hungary and Poland agree with the German proposal. In other words, the fate of the EU’s seven-year budget and recovery fund now depends on the support of this document. In any case, any Member State can say that it does not agree, but there is still no indication.

The document is a kind of interpretation of the draft rule of law. That is, it does not modify it, it simply emphasizes some elements and establishes the conditions for its application. Based on these, we can say that the most significant change is that

The rule of law conditions will take effect on January 1, but will not apply.

Member States declare that they will wait for the Court of Justice of the European Union to decide whether this law is compatible with EU law. It will undoubtedly happen that Hungary and Poland will challenge the new legislation and ask for its repeal. The procedure of the Court of Justice of the European Communities does not contain what we know in Hungary as a preliminary regulatory review submitted to the Constitutional Court. Such a legal possibility can only occur in the case of international agreements with third countries, which is not the case.

The situation is also interesting because, if Hungary and Poland are willing to support the rule of law, why are they calling for its abolition? (If they do not support it yet, the Member States may approve it by qualified majority). The German Presidency also suggests that the European Commission await this judgment and in no way apply the provisions until then. In the meantime, the Commission should develop a manual detailing when, under what circumstances and with what information it will carry out the procedure at a later stage. Here, Member States have the opportunity to comment, for example, on which NGO the Brussels panel intends to involve in the evaluation work. And this can almost certainly lead to interesting discussions.

An important question is how long the legal proceedings will take, that is, how long it can take those who use EU funds in violation of the rule of law. According to the information received from the Court of Justice of the European Communities, the duration of this claim is one and a half to two years, in normal procedures.

However, if the Court decides on an expedited procedure, this will shorten the procedure to 4-6 months.

Requesting an expedited procedure is a very rare phenomenon that occurs only for compelling reasons. In the event that the delay threatens irreparable or serious damage. The importance of the case alone is not a sufficient basis. Any of the parties may request the application of the accelerated procedure, resolving the decision of the President of the Court, who ex officio may order that said procedure be used.

The German proposal states that

“The EU budget, including the next generation EU, must be protected from all forms of fraud, corruption and conflicts of interest. The application of the conditionality mechanism under the Regulation will be objective (fair, impartial and factual), guaranteeing non-discrimination and equal treatment for the Member States “.

They also claim that there must be a direct link between the infringements and the negative consequences for the financial interests of the Union.

“The mere finding of a violation of the rule of law is not enough to activate the mechanism”

– is in the text. It should be added that there is nothing new in this, the legislative proposal contains it. There was a Hungarian attempt to have an emergency brake mechanism, which is also suitable for prolonging the procedure. The essence of this would have been that if a Member State were sanctioned, it would need the approval of the Council of Heads of State and Government. However, the European Parliament did not go into this, so a solution was reached before the Member State had the opportunity to bring the matter to the Council, which, however, only discusses the issue, does not make a decision, your approval is not required. Now it is so refined that

the Council will seek a common position on this matter.

This, in turn, does not represent any practical change compared to what has happened so far. The Heads of State and Government will discuss the issue tomorrow and will probably approve the proposal.

For the sake of completeness, it should be noted that for a seven-year budget, a delay of one to two years is unlikely to affect the control mechanism and the application of sanctions. The announcement, execution and settlement period of the first tenders will cover at least this period. However, in the case of the recovery fund, the terms are tighter, where most of the funds can be requested and used in the first two years, since these funds are used for post-epidemic reconstruction.



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