European Parliament Readies Lawsuit Against Commission Over Hungary Funds

The European Parliament is gearing up to take legal action against the European Commission following its contentious move to unfreeze billions in funds for Hungary towards the end of last year.

According to sources familiar with the matter speaking to POLITICO’s Brussels Playbook, this decision marks a significant escalation in the ongoing clash between the EU institutions.

On Monday, the Parliament’s legal affairs committee voted overwhelmingly, with 16 members in favour, one opposed, and no abstentions, to pursue legal action against the Commission.

The grounds for this move stem from accusations that the Commission violated its duty to safeguard taxpayer funds from potential misuse.

In December, the Commission took the controversial step of releasing €10.2 billion in frozen EU cohesion funds designated for Budapest.

These funds had been withheld amid concerns over human rights violations and the erosion of the rule of law within Hungary.

The timing of the Commission’s decision, coming just one day before an EU summit where leaders were slated to discuss crucial matters such as aid to Ukraine and the initiation of accession negotiations for Kyiv, drew sharp criticism.

Hungarian Prime Minister Viktor Orbán had previously hinted at blocking these discussions, leading many MEPs to perceive the unfreezing of funds as capitulation to Orbán’s tactics.

The decision by Commission President Ursula von der Leyen triggered a backlash from MEPs who accused her of succumbing to Orbán’s pressure tactics.

Greens MEP Daniel Freund underscored the belief that the Parliament has a strong case against the Commission, citing inconsistencies in the Commission’s stance on Hungary’s adherence to the rule of law.

This move to sue the Commission is not only supported by members of von der Leyen’s own European People’s Party but is also intended as a clear message to the Commission president that principles of the rule of law cannot be compromised in exchange for political dealings with Orbán.

Key leaders from various political groups are set to convene on Thursday to provide the final approval for President Roberta Metsola to initiate legal proceedings against the Commission before the looming March 25 deadline.

Notably, leaders from the S&D, Greens, Left, liberals, and even the EPP, represented by Manfred Weber, are expected to endorse this course of action.

In response to these developments, a spokesperson for the Commission reiterated the institution’s adherence to strict timelines and conditions in decision-making processes.

The spokesperson emphasised that Hungary had provided all necessary evidence regarding the independence of its judiciary, thereby obliging the Commission to unfreeze the funds.

The Commission stands firm in its assertion that its actions were fully compliant with EU law and intends to defend its decision vigorously before the EU courts.

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