Money for the rule of law. The European Parliament forgives Ursula von der Leyen. Poland is safe for now

The Court of Justice of the EU informed on Wednesday (22/06/22) that the European Parliament had been removed from its register, which in October 2021 accused that it was failing to fulfill its obligations regarding the rule of “money for the rule of law”. and Hungary, regulations that allow for cuts in EU funds if there are serious breaches of the rule of law in a given EU country, and at the same time these breaches affect “in a sufficiently direct manner” (or there is a serious risk of such an impact) on the sound management of EU funds.

The “money for the rule of law” provisions entered into force at the beginning of 2021, but the European Commission – despite several urgent resolutions of the European Parliament – was slow to apply them for long months. Although last autumn the Commission sent requests to Poland and Hungary to clarify matters possibly falling under the ” money for the rule of law “, but in fact – in line with the political promise of Ursula von der Leyen for Mateusz Morawiecki and Viktor Orban – it was waiting for the CJEU judgment on the legality of the entire regulation. The European Court of Justice only in February this year, ruling in a full 27-person bench due to the importance of the case, rejected the requests of Poland and Hungary to invalidate “money for the rule of law” as – in the opinion of both countries – incompatible with the EU treaties.

Finally, in April this year, the European Commission initiated the “money for the rule of law” procedure against Hungary, and – in the context of these provisions – put the case of Poland into a drawer. This does not mean that the European Parliament’s complaint automatically began to be unfounded – especially with regard to the period until spring However, the prevailing view was that – as you can now unofficially hear in Brussels – “if actions against Hungary are underway, it is not worth escalating conflicts between EU institutions.”

Orban double on censored

Orban’s government has until next week to propose corrective measures, including as regards the independence of the prosecutor’s office, which translates into the lack of control over the public procurement system, e.g. in the field of cohesion policy and the EU agricultural policy. The entire “money for the rule of law” procedure can take as long as six to eight months. And to approve the final decision to cut funds in the EU Council, you need the votes of 15 out of 27 EU countries representing 65% of the EU population.

Orban’s government is now negotiating reforms in the same areas (including the prosecution) both to avoid funding cuts and to unfreeze its National Reconstruction Plan. Although in the case of KPO, Budapest – like Poland before – uses retaliatory blocking of some EU projects, i.e. mainly the directive implementing the OECD agreement on the minimum CIT rate. Poland lifted its veto only after the approval of the Polish KPO by the EU Council.

Poland is safe for now

In the autumn questionnaire for Warsaw, Brussels asked how Poland – ignoring the judgments of the CJEU regarding the judiciary – intends to implement detailed EU regulations on discipline in the management of EU funds. Moreover, she pointed to doubts as to the “effectiveness and impartiality of the prosecution”, which is subordinate to the prosecutor general who is also the minister of justice (i.e. Zbigniew Ziobra). Moreover, the Commission raised the argument about “institutionalized corruption”, i.e. cases of suspected high-level corruption, which are duly pursued by the prosecution for political reasons.

However, the Commission now argues that in the case of Poland, it is necessary to stick to the usual anti-infringement procedures (with the CJEU finals), the “milestones” with the KPO and the handling of Article 7, which now boils down to political discussions between EU ministers in the EU Council. Poland, which, in the opinion of the Commission, still manages EU funds very correctly, the “money for the rule of law” mechanism is intended to be a “deterrent” to the further degeneration of the judiciary, which usually leads to increasingly worse prosecution of corruption.