The Court of European Justice denies the appeals by Poland and Hungary: the importance of the rule of law in the EU

16th February 2022 - the Judicial Court of the European Union took an important decision in relation with the respect of the right State within the EU. More specifically speaking, it denied the appeals by Poland and Hungary against the Act 2020/2092, related to a general regime of conditionality to protect the European financial statement. This Act represents a change, as it sets that the respect of the rule of law is a necessary step to obtain fundings from the Eu. It was implemented in 2020, when there was a debate on the measures to be adopted to finance the States for the economic relief during the COVID-19 pandemic, and it sets stricter parameters to make use of the European money.

In March 2021, Poland and Hungary, on which the attention of the European Union has been drawn as concerns the right State, lodged an appeal to the Judicial Court, complaining about the illegitimate character of the mechanism set forth by the Act 2020/2092. It gives the European Commission the possibility to send a notice to the States that are presumed to be carrying out behaviors against the rule of law. This proceeding, set forth within article 6 of the Act, envisages the possibility for the interested States to have a dialogue with the Commission so to clarify the controversial aspects. Once this dialogue between the implied State and the Commission is over and once this last claims some breaches of the rule of law, it draws to some conclusions and it submits them to the Council, together with the measures states to be appropriate in the concrete case. These measures are chosen among the ones set within Article 4, they give the possibility to stop payments, the delivery of payments, interruption of terms of payment and prohibitions to make new judicial commitments. The Council has therefore the aim of assessing whether to adopt a decision of execution of the measures indicated by the Commission or not. 

After the brief description of the proceeding, the grounds for the implementation of the Act within the article 5 can be found: “when a candidate country becomes a State member, it sticks to a judicial building that relies on the important premise according to which every State member shares a set of common values on which the Union is based and recognizes that every member State shares them, as highlighted by the Article 2 TEU.” An effect would be that: “[…] the respect of the rule of law is needed for enforcement of the other fundamental values on which the Union is found, as freedom, democracy, equality and the respect for human rights. The respect of the rule of law is intrinsically related to the respect of democracy and of the fundamental human rights. The one cannot exist without the others, and viceversa.”, as stated in the following recital. To conclude the discussion, Article 7 clarifies that: “when the member States make the balance of the Union […], the respect of the rule of law is an essential requirement for the respect of the principles of a healthy financial management, set forth in the Article 317 of the treaty on the functioning of the European Union (TFEU).”.

The appeals filed on 11 March 2021 by Hungary and Poland (respectively C-156/21 and C-157/21) were rejected on 16th February 2022 by the Court of Justice, also giving the possibility to the Court to express on some open topics.

The appeals asked for the annulment of the Act 2020/2092, former article 263 TFEU. None of the 20 requests within the appeals by the 2 countries has been complied with by the Court, thus bringing about a complete defeat of Poland and Hungary ahead of the major European legal body. Furthermore, the fact that highlights the political division between the EU and the two countries is their mutual support in the process; however, 10 State members supported the Parliament and the Council of the European Union (Belgium, Denmark, Germany, Ireland, Spain, France, Luxembourg, Netherlands, Finland and Sweden) besides the European Commission. The requests of the two countries attempted to affect the judicial basis of the Act, both with respect to the legislative process since its origins and to the concrete aspects, but they did not manage to obtain a rule partially in their favor. 

The ruling of the Court have represented a new step towards the respect of the rule of law, at least as concerns the possibility to impose penalties on the States that are not compliant. The Commission can now evaluate whether it’s already necessary to intervene by applying the Act or whether there are presuppositions for a dialogue with potential non-aligned States.