New setback for Poland and Hungary before their authoritarian drift. The mechanism that makes it possible to make European funds conditional on respect for the rule of law is legal. This is how the general counsel of the Court of Justice of the EU, Manuel Campos Sánchez-Bordona, considers it in his brief before the appeals presented by Poland and a Hungary against a mechanism that they were vetoing during the months prior to the approval of the European funds of 750,000 million euros. In the end, on the eve of Christmas 2020, the regulation was approved. And, thanks to that, the European recovery funds have started to be distributed.
In the end, the EU ended up agreeing with Warsaw and Budapest that the European Commission would avoid activating the mechanism until the Luxembourg-based court ruled on its legality. And, for now, this Thursday the first step has arrived, the opinion of the general counsel, which is not binding but usually coincides with 80% of the subsequent rulings of the CJEU.
Poland and Hungary, which have open files for their occupation of the Justice, the persecution of minorities and the questionable system of appointing judges, to the point that Warsaw accumulates millions in fines for it, appealed in March before the CJEU.
“The regulation has no legal basis in the treaties, interferes with the competences of the member states and violates EU law,” said the Polish government, led by the ultra-conservative Law and Justice party (PiS, an ally of Vox). The Hungarian Minister of Justice, Judit Varga (Fidesz), stated that “legislation that seriously damages community law cannot be allowed to remain in force”.
But the attorney general does not see it that way. In his presented conclusions, Campos Sánchez-Bordona points out that “the purpose of the regulation is to create a mechanism to ensure the correct execution of the Union budget, when a member state incurs in violations of the principles of the rule of law that endanger the good management of Union funds or financial interests “.
Thus, “the regulation does not seek to protect the rule of law through a sanctioning mechanism, but rather establishes an instrument of financial conditionality to preserve this value of the Union.” Therefore, the Advocate General considers that “the power of assessment of the Union institutions protects this legislative option, which cannot be classified as manifestly erroneous, since respect for the principles of the rule of law may be of fundamental importance for the proper functioning of public finances and for the proper execution of the Union budget “.
In addition, it emphasizes that the regulation “requires that there be a sufficiently direct link between the violation of the rule of law and budget execution, so that it is not applicable to all violations of the rule of law, but to those that have a connection direct with the management of the budget of the Union “.
Precisely this aspect highlighted by Campos Sánchez-Bordona was somewhat discussed by governments such as the Netherlands and institutions such as the European Parliament, which considered the mechanism unambitious because it limited its scope of action so much. “The regulation only contemplates the violation of the principles of the rule of law, by a member state, that affects or threatens to affect, seriously and in a direct way, the good financial management of the budget or the protection of the financial interests of the Union “, say the conclusions of the general counsel.