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03 Jul 2021

A Changing EU

The EU Council summit in June 2021 saw tensions come to a head between Hungary and other member states following the Hungarian parliament’s approval of a new anti-LGBT+ law. This is one of several rule of law disputes which is affecting internal EU relations.

The majority of member states expressed concern about Hungary’s new law at the summit. Luxembourg’s Prime Minister Xavier Bettel, the only openly gay leader there, said the law was a ‘red line’. Dutch Prime Minister Mark Rutte went further, saying that if Hungary refuses to withdraw the new law ‘there is nothing left for them in the EU’.

Why is the rule of law in individual member states a concern to the EU?

The rule of law is defined by the UN as ‘a principle of governance in which all persons, institutions and entities, public and private, including the state itself, are accountable to laws that are publicly promulgated, equally enforced and independently adjudicated, and which are consistent with international human rights norms and standards’.

The rule of law is one of the EU’s core values, as set out in Article 2 of the Treaty on European Union (TEU) and is a prerequisite of accession as an EU member state.

The essential criteria for candidate countries to gain EU membership include – under Article 49 of the TEU – a commitment to the values set out in the TEU’s Article 2, including the rule of law.

eu rule of law

Why does the EU have concerns about the rule of law in Hungary and Poland?

The EU believes there has been an erosion of the rule of law in Hungary and Poland since the election of Fidesz in Hungary in 2010 and the Law and Justice party in Poland in 2015. There are a number of concerns.

First, the judiciary. The European Commission’s July 2021 ‘Rule of Law Report’ found that the judicial systems in Hungary and Poland are both under threat. This comes following a series of controversial justice reforms in both countries over the past few years.

Since coming to power in 2015, Poland’s ruling Law and Justice party now directly oversees state prosecutors and the judicial body managing the appointment, promotion and disciplining of judges.

In 2018, Hungary’s ruling party Fidesz passed a law in the Hungarian parliament to set up courts overseen directly by the justice minister, undermining judicial independence. Following concerns raised by the EU, Fidesz indefinitely suspended the implementation of this law.

Second, the curtailment of press freedom. Both governments have co-opted state channels and bought private media channels. In February 2021, Hungary’s media regulator decided not to renew the broadcasting licence for the opposition-leaning Klubrádió station.

The Polish government’s plans to introduce a levy on media advertising have been described as disproportionately targeting independent media. In March 2021, MEPs urged the Commission and European Council to protect free and independent media in the two member states.

Third, human rights and equality. The Hungarian parliament has voted through a new law banning LGBT+ individuals from featuring in educational resources, TV shows or advertisements for those under the age of 18. EU leaders have asserted that the law is not compatible with EU values.

eu rule of law

European Commission President Ursula von der Leyen has said, ‘[t]his bill clearly discriminates against people based on their sexual orientation. It goes against the fundamental values of the European Union: human dignity, equality and respect for human rights.’

Hungarian Prime Minister Viktor Orbán has now confirmed that there will be a nationwide referendum on the contents of the anti-LGBT+ law, framing it as a referendum on ‘child protection’ measures.

Last year, the European Commission cancelled grants for six Polish towns after they had declared themselves ‘LGBT-free zones’. In September 2020, activists submitted a legal complaint to the European Commission stating LGBT-free zones breach non-discrimination obligations set out in the EU Charter of Fundamental Rights.

Poland’s near-total ban on abortion in January 2021 also sparked major protests in the country and was criticised by the EU Equality Commissioner, who said EU member states ‘must respect fundamental rights’.

What sanctions are available to the EU?

There are a variety of steps the EU takes to monitor respect for the rule of law and to address breaches by its member states.

The European Commission produces an annual report aiming to promote the rule of law across member states – the first of these was published in September 2020. It can invoke the Cooperation and Verification Mechanism (CVM) when a new member state has failed to meet rule of law commitments set out in their accession requirements.

Since they joined in 2007, a CVM for Bulgaria and Romania has led to them remedying shortcomings on judicial reform and corruption.

When problematic situations – like those in Hungary and Poland – arise, the Commission can activate its ‘rule of law framework,’ introduced in 2014 to strengthen the rule of law across the EU and highlight issues in member states.

It includes three stages: assessment, recommendation and monitoring of the EU member state’s response to the recommendation.

As a final resort, Article 7 of the TEU can be triggered. It has two limbs.

The first concerns situations where there is a ‘clear risk of a serious breach’ of fundamental EU values, such as the rule of law. The European Parliament, European Commission or one-third of EU member states can propose that Article 7 be triggered; two thirds of the European Parliament must then approve the proposal.

Then, following a series of hearings, four-fifths of the Council of Ministers must vote to agree the member state has committed a clear breach of EU values. The Council of Ministers then issues a formal warning and recommendations for the country to address the issue.

The second limb concerns a situation in which there is a breach. Following a proposal by the European Commission or one third of EU member states – approved by a two-thirds majority in the European Parliament – the EU Council invites a response from the member state.

The other 26 member states in the EU Council must then vote unanimously that the member state in question has committed a ‘serious and persistent breach’.

The EU Council then votes by qualified majority to determine punitive measures such as sanctions and suspension of voting rights. Because of the unanimity requirement, Hungary can block any decision to be taken against Poland and vice versa, and thus this mechanism has been stymied.

Cases on rule of law violations can also be referred by the European Commission to the European Court of Justice (ECJ). For example, in May 2021, the ECJ ruled that Romania’s reforms to its court system carried out from 2017 to 2019 risk undermining judicial independence.

What action has the EU taken so far? Why is it so limited?

Given the structural weakness of the Article 7 mechanism, the Commission has tried other legal routes, such as bringing enforcement proceedings.

In 2012 the ECJ ruled that Hungary’s judicial reform lowering the retirement age for judges breached EU law rules on age discrimination. Hungary argued the law aimed to standardise retirement ages in the public sector and ensure a balance of ages was represented; however the Commission argued that it amounted to a ‘forced early retirement’ of judges, prosecutors and notaries.

Similarly, in 2019, the ECJ ruled Poland’s lowering of the retirement age breached EU law. Poland argued the reforms would bring judges’ retirement ages in line with the general population. However, the reforms undermined the independence and irremovability of the judiciary by giving the government direct control.

Article 7 proceedings were launched against Poland in 2017 and Hungary in 2018, initiated by the European Parliament.

However, these processes have been stalled by failure to act due to the reluctance of multiple Council of Ministers presidencies to arrange further hearings, even though an ECJ challenge by the Hungarian government on the accuracy of the European Parliament vote count failed.

Covid-19 has created further problems. Council of Ministers’ hearings must happen in person or they can be challenged in the ECJ. The Council of Ministers finally held further hearings in person on the rule of law in Poland and Hungary on 22 June.

However, it is unlikely Article 7 procedures against Hungary and Poland will advance significantly in the Council of Ministers: Slovenia started its six-month presidency of the Council of Ministers on 1 July and is itself caught up in a rule of law dispute with the EU.

However, the Slovenian presidency has confirmed the Article 7 proceedings are on their agenda.

European Commission President Ursula von der Leyen announced the European Commission will take legal action against Hungary over its new anti-LGBT+ law.

The European Commissioner for Justice Didier Reynders and European Commissioner for the Internal Market Thierry Breton then wrote to Hungary stating if the anti-LGBT+ law is applied, the European Commission ‘will not hesitate to take action’.

The European Commission has now launched two infringement procedures against Hungary related to the anti-LGBT+ law.

Reynders has also written to Poland asking the government to comply with the ECJ’s recent ruling that the disciplinary procedures for Poland’s judges violates EU law by 16 August. He warned that failure to act would lead the Commission to request the ECJ impose financial sanctions.

What has happened in the European Parliament?

There have also been moves against Fidesz in the European Parliament. In March 2021, the European People’s Party (EPP) – the centre-right bloc in the European Parliament – agreed to introduce new rules that would enable it to remove ‘a member or members of the group’.

In response, Hungarian Prime Minister Viktor Orbán announced Fidesz had unilaterally decided to leave the EPP Group.

The vote came following a previous decision to suspend Fidesz from the EPP party alliance in March 2019 – however, that time round its MEPs had remained part of the EPP Group in the European Parliament.

Hungarian opposition MEP Katalin Cseh described the March 2021 vote as ‘the bare minimum’ and ‘a decade too late’.

Poland’s Law and Justice party remain part of the European Conservatives and Reformists (ECR) – the right-wing Eurosceptic bloc in the European Parliament – and have not faced contestation of their membership.

Is the row with Hungary and Poland impeding EU activity?

Hungary and Poland frequently band together to delay EU decisions that run against their interest.

In November 2020, Hungary and Poland vetoed the EU’s €1.8 trillion budget and Covid-19 recovery fund because of plans to link payments to respect for the rule of law. Eventually a compromise was reached in December to allow countries to challenge the legality of this rule of law mechanism in the ECJ before it is used.

The resulting EU regulation on ‘a general regime of conditionality for the EU budget’ is considered a significant step towards greater accountability and punitive measures. However, due to Hungary and Poland’s ECJ challenges, it is unlikely to be used until the second half of 2021.

EU finance ministers and the European Commission have spent time this summer approving spending plans for member states. However, the European Commission has now asked for a two-month delay on discussions surrounding Hungary’s recovery fund given rule of law and fundamental rights issues.

It is possible that EU leaders could resort to special measures to overcome future vetoes.

‘Enhanced cooperation’ has been suggested as a potential avenue through which the other 25 EU member states could launch funding initiatives. However, these risk running into Article 326 of the Treaty on the Functioning of the EU (TFEU), which states enhanced cooperation ‘shall not undermine the internal market or economic, social and territorial cohesion’.

Is there now a majority for action against Hungary and Poland?

Some member states think that the EU has been too slow to take meaningful action on rule of law violations committed by Hungary and Poland. However, speedier action has been blocked by the so called Visegrad 4 – Hungary, Poland, Czechia and Slovakia.

Given the variety of opinion across EU member states on next steps to take on Hungary’s anti-LGBT+ law, reaching the necessary four-fifths majority in the Council of Ministers to advance Article 7 proceedings is likely to be a challenging task.

In the run up to the June 2021 EU Council summit, 17 EU member states published a joint letter urging the European Commission to ‘use all the tools at its disposal to ensure full respect for EU law’.

This indicates these 17 member states will vote in favour of advancing Article 7 procedures on Hungary and Poland. During their presidency of the Council of Ministers, Portugal also gave their support.

However, the four-fifths majority required is still not there, with many of the states that joined since 2004 reluctant to support action.

Of the remaining seven EU member states, all look unlikely to support action: Czechia and Slovakia are likely to maintain their Visegrad 4 loyalty to Hungary and Poland; likewise Bulgaria and Romania, as they are undergoing rule of law monitoring themselves, are unlikely to support it. Slovenia and Lithuania have already said they will back Hungary and Poland. During its Council of Ministers presidency, Croatia expressed its lack of support for punitive measures against Poland and Hungary.

Is this reducing support for the EU in Hungary and Poland?

Despite these difficulties, support for the EU in Hungary and Poland has not declined. Rather, some point to an opinion divide between a ‘Europhile public’ and ‘Eurosceptic governing elite’.

Sour relations have continued between the EU and the ruling parties in Poland and Hungary. However, positive perspectives of the EU among the wider population increased from 39% in 2015 to 48% 2021 in Hungary, and remained between 50-55% in Poland.

The Hungarian and Polish publics have different perspectives to their governments on some of the main issues raised. For example, on the recent EU budget dispute, the majority of both publics support the principle of tying EU funds to respect for the rule of law.

There have also been a number of petitions on matters ranging from rule of law conditionality to membership of the European Public Prosecutor’s Office where Polish and Hungarian people have differed from their governments.

Furthermore, there is resistance within Hungary against the anti-LGBT+ law; Budapest’s July 2021 Pride March saw thousands gather to protest its contents.

The situation on the ground in both Hungary and Poland is much more complex than the top-level disputes between their governing parties and the EU might suggest.

By Sarah Overton, researcher at UK in a Changing Europe. This explainer was originally published on 3 July 2021 and was updated on 4 August 2021.

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