Hungary’s threat of a veto is in vain: a major deal has been reached in Brussels to link EU funds to the rule of law.

What is the recent development?

Spokesperson for the German Presidency, Sebastian Fischer and one of the heads of the budget delegation of the European Parliament, Petri sarvamaa It was recently posted on Twitter that there was an agreement on the conditionality of EU money in interinstitutional negotiations.

This is a very important advance, it will apply to all EU payments after 2021 and it will be possible to launch a system of sanctions, not only for violations of the rule of law, but also for the prior risk of blocking and cutting money from The EU.

A EP press conference was recently launched on the results, i.e. available here.

Despite the threat of a veto, they have come this far

The summer budget negotiation between Heads of State and Government was very vague on what exactly it means to tie EU money to the rule of law, and this has largely led to interpretative debates in recent months. According to one camp, a strict sanctions mechanism is needed, which goes beyond the proper implementation of the EU budget and covers a broader framework of the rule of law.

In the last stage of the long negotiations, the other camp was essentially made up only of the Hungarian and Polish governments, which have been subject to the rule of law for years. They stressed (and also allowed the Council to veto the other two regulations) that only a system of conditionality focused on the orderly execution of the EU budget was needed and that the vague and undefined conditions that were finally enshrined in Article 7 of the Treaty the EU could not be smuggled. they would create a parallel mechanism to the already established rule of law procedure and thus implicitly violate the Treaty. By the way, this point of view was also publicly emphasized by the governments of Hungary and Poland.

If we think about it, armed with legal teams, a group of 25 Member States, the Commission, the Council and the Parliament would not have gone in a direction that violates the EU Treaty, so this is the weakest point of the argument of Hungary and Poland. For this reason, several in EP circles have said in discussions in recent weeks that the veto threat of Hungary and Poland, which is just a hoax, must be disguised, is a bargaining chip for softening that does not need to be addressed, because both Hungary and the other member states are in dire need of new EU money to alleviate the coronavirus crisis.

Gergely Gulyás appeared to have tried yesterday to take this threat seriously, but in today’s interinstitutional negotiations in Brussels a relatively strict system of rule of law was adopted.

This means that an agreement in principle has been reached between the German Presidency, Parliament and the Commission on the rule of law, which has not yet been approved by the Council and Parliament. In the Council, a qualified majority was sufficient to approve the regulation on the rule of law, which was already in force in the first vote at the end of September (20 Member States supported, 7 voted against, including Hungary and Poland because it was too strict and the five Member States of the very soft north). This qualified majority will surely be in the Council in the final vote, but the question is what will happen to the other two regulations, which, in turn, will have to be decided unanimously in the Council. There, the vetoes of Hungary and Poland may still be sharpened, and then the whole question of the EU budget process and the recovery fund will get stuck in a pit.

More details coming soon.

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