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Brussels backs €7.5 billion cut in EU funds to Hungary over rule of law

November 30, 2022
Hungarian Prime Minister Viktor Orban
Hungarian Prime Minister Viktor Orban

BRUSSELS — The European Commission recommended on Wednesday that €7.5 billion of EU funds be withheld from Hungary over rule of law concerns.

Budapest had until November 19 to pass 17 reforms negotiated with the EU's executive over the summer in order to avoid the freeze threatened by Brussels as part of its rule of law mechanism.

"While a number of reforms have been undertaken or are underway, Hungary failed to adequately implement central aspects of the necessary 17 remedial measures...as it had committed to," the Commission said.

"As a result, the Commission has decided to maintain its initial proposal of 18 September to suspend 65% of the commitments for three operational programmes under cohesion policy, amounting to €7.5 billion," it added.

Meanwhile, the Commission has endorsed Hungary's €5.8 billion post-COVID Recovery Plan — a step that is required before the end of the year with Hungary the only member state not to have had its plan approved yet.

But Brussels attached some strings and demanded Budapest attain 27 so-called "super milestones" in order to secure the funds.

The 27 reforms include the 17 remedial steps already negotiated as part of the rule of law conditionality regulation as well as reforms to strengthen judiciary independence and new rules on auditing and reporting on EU funds.

Executive Vice-President Commissioner Valdis Dombrovskis stressed that "the essential milestones must all be met in full before Hungary can submit its payment request."

"In short, no funds will flow until the essential milestones are properly implemented," he added.

EU countries will have to vote on whether to endorse the two Commission recommendations with qualified majorities necessary for both votes to pass.

The votes could take place at the earliest on December 6 when economy ministers gather in Brussels for an Ecofin meeting where Budapest has blocked the adoption of a global corporate tax.

Such vetoes by Budapest have been decried as blackmail by other member states and attempts by Hungary to secure concessions on other files, including access to EU funds and sanctions against Russia. — Eurnews


November 30, 2022
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