MEPs gear up to sue European Commission over release of €10.2 billion for Hungary

A final announcement is expected in the coming days following a positive vote in the Legal Affairs Committee on Monday evening. The legal action requires the approval of the Parliament’s president, Roberta Metsola, and has to be submitted before the European Court of Justice by 25 March at the latest.

The ire of MEPs stems from the decision taken by the European Commission in December that unblocked €10.2 billion in cohesion funds for Hungary, which the country had been unable to access due to persistent deficiencies in the rule of law.

The Commission argued the release was justified because Budapest had passed in May last year a reform to strengthen judicial independence and mitigate political interference in the courts, in line with four “super milestones” that the executive had imposed.

Lawmakers, echoing the concerns expressed by civil society, challenged the reasoning and said the overhaul was not up to the task. They also complained the money had been unfrozen one day before a crucial summit of EU leaders in which Prime Minister Viktor Orbán had threatened to veto key agreements on Ukraine.

In a scorching resolution approved in January, MEPs raised the prospect of legal action and stressed that “in no way can the EU give in to blackmail and trade the strategic interests of the EU and its allies by renouncing its values.”

“Hungary does not meet the standard of judicial independence set out in the (EU treaties) as the measures adopted do not ensure sufficient safeguards against political influence and can be either circumvented or inadequately applied,” they wrote.

Days later, MEPs grilled Commissioners Didier Reynders (Justice), Nicolas Schmit (Jobs) and Johannes Hahn (Budget) for striking what they called a “political deal” with Orbán to ensure the lifting of his veto in exchange for the €10.2 billion.

The three Commissioners stood firm and insisted Hungary had provided sufficient evidence to demonstrate compliance with the four “super milestones,” which included measures to strengthen the National Judicial Council, a self-governing supervisory board, and crack down on political meddling inside the Supreme Court.

“The Commission was under legal obligation to take a decision,” Reynders said.

As of today, Brussels is still withholding nearly €12 billion from Hungary’s allocated share of cohesion funds and most of its €10.4-billion recovery and resilience plan, a situation that Orbán has repeatedly denounced as “financial blackmail.”

Each envelope is subject to different sets of conditions that require legislative changes in fields like LGBTQ+ rights, asylum policy, public procurement and anti-corruption.

But in their January resolution, MEPs said the funds that remain blocked “must be treated as a single, integral package, and that no payments should be made even if progress is made in one or more areas but deficiencies still persist in another.”

Speaking on Tuesday morning, Valérie Hayer, chair of the Renew Europe group, called on the Commission to uphold “complete transparency” and provide the Parliament with all the information regarding the release of further funds.

“It’s very important that we look at the legal aspects of the decisions taken by the Commission,” Hayer told reporters.

This is not the first time the Parliament has taken its case to Luxembourg to force the Commission’s hand. In October 2021, the hemicycle filed a lawsuit against the executive for its “failure to apply” a novel mechanism that linked payments of EU funds to respect for the bloc’s fundamental rights.