BRUSSELS BEHIND THE SCENES
Weekly analysis with Sam Morgan
The European Parliament has decided to sue the European Commission over its decision to unblock €10 billion in funding for Hungary. Viktor Orban will be laughing all the way to the bank regardless.
MEPs warned at the beginning of the year they would take the Commission to court over its Hungary decision and this week the Parliament made good on its threat, confirming that it will file legal action against the EU executive.
It is a big step in an election year. The Parliament will want to be seen to be standing up to corruption and illiberalism, but also risks creating an institutional split right when the EU should be presenting a united front for voters.
Viktor Orban and leaders just like him continue to feel the benefit. For now.
BRUSSELS BEHIND THE SCENES includes weekly analysis not found anywhere else, as Sam Morgan helps you make sense of what is happening in Brussels. If you want to receive Brussels Behind the Scenes straight to your inbox every week, subscribe to the newsletter here.
The European Commission froze most of Hungary’s pandemic recovery support and cohesion funding in response to a number of legal changes made by Viktor Orban’s government that Brussels decided breached rule of law principles.
Until Orban reversed or rectified the situation and met a number of “super milestones” put in place by the Commission, the money would remain under lock and key. This was the first act that gave Hungary’s prime minister leverage.
Orban used his veto at European Council summits to block financial support for Ukraine, insisting that he wanted to keep Hungary “out of the war”. It was clear to all that it was a grand and public act of blackmail.
It partially worked. The Commission announced on the eve of December’s summit that €10 billion would be unfrozen, justifying the decision by insisting that Hungary’s government had made good on some of the promises it had made.
This predictably provoked outrage. The EU had capitulated to threats. It had given it to blackmail. A precedent had been set that other wannabe-autocrats will follow when they want to hold the EU to ransom. Orban will do it again.
All arguably and probably true. Ukraine also got €50bn in valuable funding to help resist Russia’s invasion, as a silver lining.
It is understandable why the European Parliament has decided to launch this legal action. MEPs did not sanction the funding and have made it clear that in their view Hungary is still an illiberal democracy.
EU elections in June also loom large. We are entering a period when the Parliament actually gets to flex its muscles. Later this year, a fresh batch of lawmakers will be asked to vote on the new Commission president and their eventual picks for Commissioners.
In 2019, the Parliament only narrowly backed Ursula von der Leyen’s appointment and rejected a couple of Commissioner candidates (Hungary’s, for example). Filing a lawsuit is a reminder to the EU executive that someone watches the watchmen.
The Parliament did not have any other logical recourse. Failure to do anything would be a serious sign of weakness. Torpedoing the next Commission purely out of some sense of revenge would be counterproductive.
But what will this court case achieve beyond that?
It is likely to take years. Inter-institutional drama at the European Court of Justice plays out over the course of a decade, not a year. Von der Leyen’s current Commission will be long gone by the time a ruling is provided. Her next one might be done too by then.
A clawback of the cash given to Hungary is unlikely too, an eventual judgement might order it or might instruct the Commission to take the money out of future payouts.
Perhaps the threat of legal action will be enough to prevent the Commission from unlocking the rest of Hungary’s money: there’s €12bn in cohesion funding and most of Hungary’s €10bn in Covid money still on ice.
A wider-reaching change that could be triggered by the case is the Commission’s oversight of democratic norms.
The Commission is very susceptible to blackmail because of its role as the Union’s executive branch. Its recent diluting of agricultural rules following farmer protests across Europe is a case in point.
If the institution cannot be trusted to fairly decide rule of law matters, then a separate body may need to be set up to handle this. A couple of Parliament officials told Behind the Scenes that this is an option under serious consideration.
There is also the chance of course that judges say the Commission did not breach its rules. The EU executive is adamant that its course of action was all above aboard. The optics were terrible – as is often the case with this Commission – but perhaps the legality was fine.
Viktor Orban said yesterday during Hungary’s national day celebrations that “if we want to defend Hungary's freedom and sovereignty, we have no other choice but to occupy Brussels.”
The farmer protests have shown that this is a viable strategy for interest groups looking to get something for nothing out of the EU institutions. Blackmail works.
BRUSSELS BEHIND THE SCENES includes weekly analysis not found anywhere else, as Sam Morgan helps you make sense of what is happening in Brussels. If you want to receive Brussels Behind the Scenes straight to your inbox every week, subscribe to the newsletter here.
