CESI welcomes EP resolution on conditionalities for Member States to receive EU funding

The resolution of the European Parliament, adopted by the full plenary, welcomes recent judgments of the Court of Justice of the EU (CJEU) in cases C‑156/21 and C‑157/21 on the validity of EU Regulation 2020/2092 (the so-called ‘Conditionality Regulation’) on a general regime of conditionality for the protection of the Union budget.

Adopted in 2020 in connection with the EU’s new Multiannual Financial Framework for 2021-2027, the regulation allows the EU to make access to EU funding for Member States subject to the respect of the rule of law by the latter.

In particular, the mechanism set out in the regulation allows the European Commission and the Council to take action to protect the Union budget when they consider that breaches of the rule of law principles can affect the EU’s financial interests.

Hungary and Poland claimed that the regulation lacks an appropriate legal basis in the Treaties and that the procedure laid down by the Regulation exceeds the comptences of the EU and, each starting their own legal procedures, requested its annulment before the Court of Justice of the European Union.

In its judgements, the Court rejected the claims of the two Member States and confirmed the validity of the regulation, recognising the power of the EU to intervene in order to protect its financial interests when the breaches of the rule of law by a Member State affect or risk affecting them.

In the European Parliament’s resolution adopted on March 10 by a large majority of 478 votes in favour and 155 against, MEPs welcomed the judgements of the CJEU and called on the European Commission to immediately initiate proceedings and take financial measures against Member States that fail to respect the rule of law.

More specifically, the European Parliament stressed that it is “high time” for the European Commission to protect the EU finances from the breaches of the rule of law and called it to implement EU legislation also regardless of the electoral timetables in the Member States.

CESI Secretary General Klaus Heeger said: “The war in Ukraine has reminded us of our duty to safeguard our common European values and, of course, the rule of law, which is a prerequisite for stability, efficient cooperation, and security in the wider region. The resolution of the European Parliament gives a strong political dimension to the recent CJEU rulings which should be enforced properly. Europe has a historic opportunity to strengthen its cohesion on the basis of a durable system of institutions, laws, and norms and to fulfill its role as a pole of stability and prosperity.”