#EUFridays by JEF Hungary #36

The European Parliament plenary, and the cash flow stop regarding Hungary

As the holiday season rolls around, the European Parliament had its plenary session between November 21-24 in Strasbourg, yet again. We saw many things out on the table, some of them being principal and essential, the others less so or even pretentious, but one thing is certain: the EP never disappoints.

Topics included the reform of the EU fiscal rules, the new EU strategy for enlargement, call for the modernization of the Energy Charter Treaty, debates on human rights and violence against women – which is more important than ever, considering the inhuman conditions of women’s right in Iran and the average human rights situation in Egypt and Afghanistan –, the acceptance of Russian passports, but maybe one of the most exciting questions of the plenary came about on Wednesday: the EU cash flow stop in case of Hungary.

Brussels has been withholding billions in funds from the Hungarian government and the country itself already as leverage as it tries to halt what it sees as democratic backsliding; however, Hungary has failed to adopt promised rule-of-law reforms, the European Commission decided Wednesday, putting billions in EU cash in jeopardy for the country.
The determination comes as Brussels wrangles with Viktor Orbán’s government over the release of both €7.5 billion in regular EU payouts and €5.8 billion in pandemic recovery grants.

While the Commission on Wednesday recommended approving Hungary’s plan to spend its recovery funds, it was clear that the country would not actually get the money until it implements 27 specific rule-of-law upgrades. The Commission also concluded that Hungary had fallen short in fulfilling a prior pledge to adopt 17 rule-of-law reforms that are needed to access the €7.5 billion in EU funds, which are being held up under the rule of law mechanism allowing the EU to freeze funds at risk of graft.

Brussels and Hungary have clashed for years over rule-of-law issues with Hungary accused of using its veto power at the Council level to secure concessions and funds. It is currently blocking the EU's adoption of a global corporate tax agreed by more than 130 countries last year and announced on Thursday morning that it would veto the European Commission's plan to issue common debt to raise €18 billion in assistance for Ukraine.

After the Commission formally adopts its decisions next week, it will be up to the Council of the EU to support or reject them by a qualified majority — comprising 55 percent of countries and 65 percent of the EU’s population — which should happen at a finance ministers meeting. The exact date of that meeting is still unclear, as the one originally scheduled for December 6 may be too soon to allow countries to go through national parliamentary procedures. Thus the Czech presidency of the Council may schedule another ministerial meeting later in December.

Via Politico, Euronews, Europarl.europa, BBC

Romania takes a deep breath: the rule-of-law surveillance ends after 15 years

On Wednesday, the European Commission confirmed that the country of Romania had made enough progress on judicial reforms and the fight against corruption, granting the official closure of the so-called Cooperation and Verification Mechanism (CVM).

The mechanism was originally launched in January 2007, when Romania and Bulgaria both joined the European Union. Back then, both countries were considered to be lagging far behind in judicial standards compared to the rest of the bloc, and the process was meant to bridge this gap and help the two countries align with their fellow member states and ensure the correct application of EU law.

The European Commission put an end to Bulgaria's supervision in 2019 after concluding it had met all the necessary conditions.

Romania picked up the slack and injected "renewed impetus" into the CVM process, fulfilling the remaining objectives, including reforms on political immunity for members of the parliament, conflicts of interests and the recovery of criminal assets.

This week, the Commission announced the progress in all outstanding issues was sufficient and officially closed the CVM chapter.

"Fifteen years after accession, the conclusions of the report reflect Romania's efforts and its entry into a logic of strengthening our European status," said Nicolae Ionel Ciucă, Romania's prime minister, in reaction to the news. "We remain firmly anchored in Romania's clear and long-term pro-European vision, a European vision based on unity, democracy, rule of law and values ​​shared equally by all member states." As a result, Romania will no longer be under any tailor-made supervision: its judicial system will be monitored as part of the annual rule-of-law report, which the European Commission applies to all 27 member states.

However, this doesn't mean corruption is no longer a problem inside the country. Romania is still one of the lowest-ranking EU countries in the Corruption Perceptions Index of Transparency International, with a meagre 45/100 score.

Via Politico, Euronews