Hungary’s relations with the European Union took a turn for the worse after the government of Prime Minister Viktor Orbán passed a law that was heavily criticized for discriminating against LGBTQ people. EU lawmakers are urging the decision-making bodies in Brussels to punish Hungary by blocking funds from the EU stimulus package.
Hungary came under fire at the latest EU summit this week for passing a law, which prohibits content for minors that can be interpreted to promote homosexuality. Several European lawmakers were calling on the European Commission and the European Council to take action against the government of Prime Minister Viktor Orbán. The speakers urged decision-making bodies in Brussels to block funds from the EU stimulus package.
In response to a rising number of contentious issues, the European Commission may delay its approval of Hungary’s recovery plan, according to reports by Bloomberg and Politico. According to these reports, the European Commission will cite insufficient measures to contain corruption for not granting approval to Hungary receiving EUR7.2 billion from the EU's coronavirus recovery fund.
Earlier this year, Brussels and Budapest clashed over Hungary's record on the rule of law and Hungary threatened to veto the bloc’s coronavirus recovery fund. The move to withhold the approval would only be a temporary measure and certain concessions from Hungary would open the door to the flow of EU funds.
The Commission’s decision comes after growing pressure from the European Parliament and other EU member states to take action against Hungary.
Pressure from MEPs
In June, members of the European Parliament voted that if the European Commission does not initiate its rule of law procedure against Hungary and Poland, the European Parliament would take the Commission to court. The European Parliament stressed that the new rule of law instrument, introduced to protect the use of EU funds, must be respected. According to the MEPs supporting the decision, the risk of misuse of the EU budget has grown and the rule of law is deteriorating in Hungary, which jeopardize the “fair, legal and impartial distribution of EU funds.” Since the European Commission has not proposed any measures under the new rules and has missed the deadline to finalize the guidelines of the application of the Regulation, it faces potential legal action, Parliament said.
Earlier his week, Hungarian opposition party Párbeszéd joined forces with three peers in Poland to ask Ursula von der Leyen, president of the European Commission, to initiate a European Commission scrutiny of the rule of law situation in Hungary and Poland and manage any allocation of future EU funding accordingly. In their letter, the politicians asked the EC to activate the EU’s rule-of-law conditionality mechanism to assess whether there have been any systemic violations of the rule of law either in Hungary or in Poland. The parties proposed that the EC should tie respect for the rule of law to the disbursement of EU funds. In addition, the parties urged the Commission to allow local and regional governments, civil organizations and SMEs direct access to EU funds.
At the same time, the EU is adamant that issues related to the rule of law and the recently adopted “child protection law” should be treated separately . "The assessment of Hungary’s recovery and resilience plan and the analysis of the Hungarian [child protection] bill are two separate and parallel processes,” a Commission spokesperson said.
Against that backdrop, Brussels plans to endorse the Hungarian recovery plan sometime in July if Budapest shows willingness to make some concessions. Gergely Gulyás, minister in charge of the Prime Minister’s Office said at a press conference this week that negotiations with the Commission are continuing while other members of the government admitted that the Commission has come up with new demands regarding the recovery plan.
Under the rules of the EU recovery fund, countries must abide by the policy requests formulated in Brussels in exchange for the money. One such request to Hungary is to "reinforce the anti-corruption framework, including by improving prosecutorial efforts and access to public information, and strengthen judicial independence."
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