EU funds 10 June 2021, 6:05pm

MEPs press Commission to defend EU funds from rule of law violators

Portfolio

In a plenary resolution adopted with a sweeping majority on Thursday, MEPs demanded that the European Commission swiftly addresses the severe violations of the principle of rule of law in some member states that are putting in danger the fair, legal and impartial distribution of EU funds. Parliament will start preparation for court proceedings against the Commission for its failure to act on the legislation. The Commission has two weeks to fulfil its obligations, MEPs said.

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In a resolution adopted on Thursday with 506 votes in favour, 150 against and 28 abstentions, MEPs note that the new conditionality instrument to protect the EU budget has been in force since 1 January 2021 and also applies to the Recovery funds.

Despite this, the Commission has not proposed any measures under the new rules and has not respected the deadline of 1 June given by Parliament in its 25 March resolution to finalise the guidelines on the application of the Regulation.

This “constitutes a sufficient basis for taking legal actions under Article 265 of the TFEU against the Commission”, they say.

The risk of the EU budget being misused in EU countries has grown and rule of law is deteriorating,

MEPs stress, and they instruct President Sassoli to call on the Commission, within two weeks at the latest, to “fulfil its obligations” under the new regulation.

To be ready, “the Parliament shall in the meantime immediately start the necessary preparations for potential court proceedings under Article 265 of TFEU against the Commission”.

MEPs urge the Commission to

swiftly address the severe violations of the principle of rule of law in some member states that are seriously jeopardising the fair, legal and impartial distribution of EU funds.

It should use all tools necessary, including the procedure foreseen in Article 7 of the EU Treaty, the EU rule of law framework and the infringement procedures,

to address the persistent violations of democracy and fundamental rights in the EU, including attacks on media freedom, journalists, as well as freedom of association and assembly.

Sitting in a burning house

During a meeting of Parliament’s budget and budgetary control committees on 26 May, MEPs discussed the way forward with Gert Jan Koopman, Director-General of the Commission's budget department.

Koopman emphasised the sensitive nature of potential Commission assessments regarding the rule of law in EU countries: “Decisions taken will be subject to full judicial review by the [European] Court of Justice," he said. "We need to get this right from the beginning. We simply cannot afford to make mistakes and bring cases that are annulled by the Court. This will be a disaster.”

The Commission has been preparing guidelines explaining how it will implement the law. Koopman said that the Commission will consult Parliament on the guidelines in the first half of June.

MEPs said that the regulation is already quite clear. “If one wanted to have a very short set of guidelines, one could just write in one sentence: ‘Take a look at the regulation',” said Petri Sarvamaa (EPP, Finland).

Terry Reintke (Greens/EFA, Germany) said: “ You have some of the smartest lawyers in Europe, you have the best civil servants to protect the EU budget and the rule of law. But the impression is [...] that you are lacking a certain sense of urgency. It feels like you are sitting in this burning house and you say: ’Before we call the fire brigade, we are actually going to come up with guidelines on how they can extinguish this fire’."

Parliament is keen to see the system implemented given concerns in recent years about the rule of law and democracy in some member states.

Hungary and Poland have brought cases before the European Court of Justice demanding that the regulation be annulled. In their meeting on 10-11 December 2020, EU leaders agreed that the Commission should prepare guidelines for the implementation of the rules that should be finalised after the ruling of the Court of Justice.

Background

The rule of law conditionality regulation, designed to protect EU funds against their possible misuse by EU governments, entered into force on 1 January 2021. However, no measures have been proposed under the new rules. The European Council asked the Commission to delay their application so member states could challenge it in the EU Court of Justice (Poland and Hungary did so on 11 March 2021), and until the Commission had developed specific application guidelines.

In a resolution adopted in March 2021, Parliament reiterated that the European Council’s conclusions on this matter carry no legal effect, and that application of the new regulation cannot be subject to any guidelines. If the Commission deemed such guidelines necessary, they should be adopted no later than 1 June. MEPs also asked the Commission to consult the Parliament before their adoption. In a committee meeting on 26 May, the Commission indicated it intends to consult the Parliament in the first half of June.

A jogállamisági feltételrendszer január 1-jén lépett életbe, de a tagállami kormányok vezetőit tömörítő Európai Tanács arra kérte a bizottságot, hogy halassza el a jogszabály alkalmazását addig, amíg Magyarország és Lengyelország az Európai Bíróság elé nem viszi a jogszabályok ügyét, és amíg a bizottság ki nem dolgozza a jogszabály alkalmazására vonatkozó külön útmutatóját.

Míg Magyarország és Lengyelország március végén az uniós bírósághoz fordult, az EP elfogadott állásfoglalásában azzal érvelt, hogy az Európai Tanácsnak a mechanizmusra vonatkozó következtetései nem rendelkeznek törvényi erővel, és a bizottság számára június elsejét tűzte ki az iránymutatások elfogadásának határidejeként.