Daniel Freund

21. July 2020 Anti-Corruption

Merkel gives in to Orban at EUCO summit: EU money keeps flowing without corruption control and sanctions

The heads of state and government of the European Union have agreed on historic Corona aid and the Multiannual Financial Framework for the European Union for the next seven years.

However, planned sanctions for EU member states that violate fundamental rights and the rule of law have been watered down beyond recognition. The hurdles for triggering a rule of law mechanism were set so high in the outcome of the negotiations that it will probably never be applied in this form.

The European Parliament and the Commission had put a good proposal on the table to stop the disbursement of EU billions if, for example, an independent judiciary were to be dismantled in Poland or Hungary or if the freedom of the press were to be massively curtailed.

The compromise of the Heads of State and Government is thus in direct opposition to the position of Parliament, which has to approve the EU budget and Corona aid.

Daniel Freund, Green rapporteur on the rule of law mechanism in the Committee on Budgetary Control, comments:

“The summit compromise on the EU budget and recovery fund is a declaration of war by the Heads of State and Government on the European rule of law. It puts them on a collision course with the European Parliament and makes a quick agreement unlikely. The signal to all those who throw universities out of the country, harass journalists, attack independent judges and fill their own pockets with taxpayers money is clear: “We criticise you in our speeches, but you need not fear any consequences.”

“The speed by which German Chancellor Angela Merkel throws European values under the bus is breathtaking. Nine days ago, she declared fundamental rights to be the top priority of the German Presidency of the Council. Now she’s giving Viktor Orban a free pass. The whole of Europe can now observe that loyalty to principles is a foreign word for the German Chancellor.”

“Today Fidesz in Hungary is uncorking the champagne. Billions iof Euros from Brussels can now be used to suppress the opposition and buy up the last free media in the country. Besides, billions more of Europe’s taxpayers end up in the pockets of Orban’s clan. It is a black day for European values.”

“Parliament would have liked to move quickly to provide much needed aid to the countries hardest hit by COVID-19 and the economic collapse. But without some kind of control over the rule of law and corruption, much of that money will not get to those in need. So the deal is less of a Corona bailout and more of a promotion program for corruption and democracy reduction.”


Background: Rule of Law in the Summit Compromise

22) The Union’s financial interests shall be protected in accordance with the general principles embedded in the Union Treaties, in particular the values of Article 2 TEU. 

The European Council underlines the importance of the protection of the Union’s financial interests. The European Council underlines the importance of the respect of the rule of law.

23 Based on this background, a regime of conditionality to protect the budget and Next Generation EU will be introduced. In this context, the Commission will propose measures in case of breaches for adoption by the Council by qualified majority. 

The European Council will revert rapidly to the matter. 

24 The Commission is invited to present further measures to protect the EU budget and Next Generation EU against fraud and irregularities. This will include measures to ensure the collection and comparability of information on the final beneficiaries of EU funding for the purposes of control and audit to be included in the relevant basic acts. Combatting fraud requires a strong involvement of the European Court of Auditors, OLAF, Eurojust, Europol and, where relevant, EPPO, as well as of the Member States’ competent authorities.