EU Commission starts proceedings against Hungary

The suspicion weighs heavily: A clique around President Orbán is said to be enriching itself at the expense of the EU. Now the European Commission wants to severely limit payments to Hungary.

Because of corruption and other violations, Hungary has to reckon with the withdrawal of EU aid worth billions: The European Commission triggered the so-called rule of law mechanism in Brussels on Wednesday, which can lead to high financial sanctions. Commission President Ursula von der Leyen announced the move shortly after Hungarian Prime Minister Viktor Orbán was re-elected in early April. Politicians in the European Parliament, who had been putting pressure on for months, reacted with relief.

“Today the EU Commission sent the formal notification to Hungary,” wrote EU Justice Commissioner Didier Reynders on Twitter. This formally begins the procedure, which according to EU officials can lead to a decision on sanctions within five to nine months.

Suspicion: Orbán clique is enriching itself at the expense of the EU

Among other things, Brussels accuses Hungary of corruption, conflicts of interest and massive problems with public procurement and party financing. Behind this is the suspicion that a clique surrounding Orbán is enriching itself to the detriment of the common EU budget. According to one official, the Commission wants to take a close look at the allocation of agricultural land to Orbán’s confidants, for example, because this involves high EU subsidies.

“FINALLY!” wrote MEP Daniel Freund (Greens) on Twitter, who set up a cross-party working group against corruption. “Soon there will be no more EU funds for Orban’s autocrat course.” The social democratic S&D group in the European Parliament also welcomed the step as overdue. “Taxpayers’ money must be protected from those who violate the rule of law and dismantle democracy,” the group wrote on Twitter.

Hungary could miss out on EU payments

The rule of law mechanism that has now been activated has been in force since the beginning of 2021. This means that payments from the EU budget for countries can be reduced or funds from the structural funds can be frozen in the event of violations of common fundamental values. In the end, a decision by at least 15 EU countries, which represent 65 percent of the population, is necessary.

Hungary has “refused for more than ten years” to implement the recommendations from Brussels and to investigate the corruption cases, said an EU official. The exact scope of the possible financial sanctions has not yet been determined. At the end of the multi-stage process, the Commission can make a proposal to the member states to cut budgetary funds for Hungary. Aid for the country amounting to a good seven billion euros from the Corona development fund has already been frozen in the dispute.

Also Poland in focus

Hungary and Poland had challenged the rule of law mechanism before the European Court of Justice (ECJ), but the judges dismissed the lawsuits in February. It is still unclear whether and when the Commission will take action against Poland.

Brussels is at odds with Warsaw primarily over judicial reform. The EU Commission accuses Poland of appointing judges up to the Constitutional Court to support the government’s national conservative course. Hungary and Poland are also being targeted by the Commission for violations of press freedom and minorities.

Another criminal case against Hungary and Poland under Article 7 of the EU Treaty has de facto come to nothing. It can theoretically lead to the withdrawal of voting rights, but both countries supported each other.