The announcement comes two days after Hungarian Prime Minister Viktor Orban won a fourth consecutive term in an election that international observers said was marred by unequal conditions of competition in favor of the ruling Fidesz party. It is an issue that took place during Orbán’s decade in power, during which civil liberties organizations say the Hungarian leader gradually took control of democratic institutions and channeled taxpayers’ money into friends and family. Von der Leyen said its team briefed Hungary on its decision on Tuesday after examining Budapest’s response to an informal letter sent by the Commission last November asking for information on its rule of law concerns. “We have carefully assessed the outcome of these questions,” von der Leyen told the European Parliament. “Our conclusion is that we have to move forward [to] the next step.” Hungary is the first country to face proceedings under the new government, which gives the EU the power to cut millions of EU payments in countries where it considers rule of law breaches to jeopardize the bloc’s budget. The Commission’s decision to move could mark a turning point in Brussels’ willingness to prosecute bizarre members accused of corruption and democratic backwardness. However, while von der Leyen is now ready to move forward after months of consultation, significant bureaucracy and political debate must unfold before it becomes known whether Hungary will eventually lose critical EU funds. Once the Commission formally starts the process, a lengthy exchange of views with Budapest is expected. It will then be up to the EU Council, made up of representatives from each country, to finally decide whether to cut the money. Any cut in funding requires a “qualified majority” to pass – at least 55 per cent of EU countries representing at least 65 per cent of the bloc’s population. Responding to von der Leyen’s announcement, Minister Gergely Gulyás – who serves as Orbán’s chief of staff – rebuked Brussels in the Hungarian media, saying the EU was effectively punishing Hungarian voters for their democratic choices. Hungary has long served as a test case for the EU’s ability to combat rule of law violations within its own ranks. Since coming to power in 2010, Orban’s government has introduced a new constitution and changed the electoral system, while the ruling Fidesz party has expanded its influence in the judiciary, state media and education system, placing Orbán’s followers in the steering wheel of institutions, by the Attorney General. office in a media watchdog. At the same time, high-level corruption is rampant in Hungary, with Orbán’s family members and close friends becoming some of the richest people in Hungary – thanks in part to EU-funded public procurement projects. As a result, experts and political opponents say, Hungary is no longer a fully developed democracy. The Hungarian government, meanwhile, has long denied that there are problems with democracy at home, rejecting the new mechanism as a politically motivated tool. However, Brussels is finding it difficult to deal with the democratic setback in Budapest, with officials often stressing that the underlying conditions of the bloc did not envision a scenario where a member state follows an authoritarian course. For several years, the various EU institutions have tried in vain to use existing measures to bring Hungary to its heels. The Commission has repeatedly taken Hungary to the EU Supreme Court over its controversial moves, but Orban has continued to consolidate power. The European Parliament started the process of censoring the bloc under Article 7 in 2018 – an extreme move that could lead to the loss of a country’s voting rights – but the process has stopped. Under pressure from frustrated Western EU governments and members of the European Parliament – who have complained that governments violating democratic rules are abusing EU taxpayers’ funds – the bloc set up a new mechanism in late 2020 to allow the bloc to reduce EU funding in Member States where Rule of Law infringements affect or are likely to affect the EU budget in a “fairly direct way”. However, under a political agreement reached between EU leaders, the Commission agreed to suspend the development of the new government until Hungary and Poland challenge the legitimacy of the new mechanism before the EU Court of Justice – a delay that has caused deep frustration in the EU. civil society groups and many MEPs. Eventually, the court gave the mechanism a legitimate green light in February, but the Commission chose to wait until the end of the elections in Hungary to proceed.
