Daniel Freund

31. January 2023 Anti-Corruption

Poland and Hungary: More than two thirds of EU funds frozen - BACKGROUND

Due to violations of the rule of law, the EU Commission is currently withholding 138 billion Euros to Poland and Hungary. EU payments from both the regular budget and from the Next Generation EU fund are affected. In total, around 27.8 billion euros are currently suspended for Hungary and 110.8 billion for Poland. This amounts to a total of 68% of all EU transfers to Hungary and 77% to Poland. The figures in detail:


Next Generation EU fund

The Hungarian RRP was approved by the EU Commission and the Council. However, the milestones necessary for disbursement have not yet been met. 5.8 billion euros will therefore not be paid out.

Common Provisions Regulation

The Common Provisions Regulation (CPR) ties the spending of EU money from eight funds to respecting the EU Charter of Fundamental Rights. The Commission concluded that Hungary does currently not meet this condition. The reasons are the lack of independence of the judiciary, the so-called “child protection law” and “serious risks” for academic freedom and the right to asylum. The result: 22 billion Euros from the EU budget have been frozen.

Rule of Law Mechanism

Under the Rule of Law Mechanism, around 6.3 billion Euros from the regular EU budget to Hungary was frozen at the end of 2022. To release these funds, the Hungarian government must meet a total of 17 milestones. The reform package was negotiated with the EU Commission, but but implementation has been insufficient. These 6.3 billion Euros are also part of the 22 billion that are currently frozen under the Common Provisions Regulation.


Next Generation EU fund

The Polish recovery plan was approved by the EU Commission and the Council of Member States in mid-2022. However, the milestones required for disbursement are not met so far. They concern the controversial Polish judicial reforms. Currently, there are negotiations ongoing between the EU Commission and the Polish government on whether the latest Polish legislative changes in the justice sector are in line with the milestones. Nevertheless, 35.4 billion euros have not yet been paid out.

Common Provisions Regulation

According to the EU-Commission, Poland cannot guarantee that EU funds will be spent in accordance with the Charter of Fundamental Rights. In the case of Poland, it is still unclear where exactly the Commission fears a violation of fundamental rights. It can be assumed that it is mainly the violation of the rights of LGBTI persons and the lack of independence of the judiciary. The result: 75 billion euros from the EU budget have been frozen.

Rule of Law Mechanism

The conditionality mechanism was not triggered against Poland – despite several requests by the European Parliament.

Penalty for non-compliance with rulings of the European Court of Justice

The Polish government has not implemented the ECJ ruling on the controversial disciplinary chamber in the judiciary. Consequently, in October 2021, the ECJ imposed fines of €1 million/day. Since the Polish government refuses to pay the fines, they are deducted from EU transfers from Brussels. To date, these amount to a total of 460 million euros. Since these are penalties and not frozen transfers, these funds are lost irrevocably.


The EU can be our best tool in the fight against corruption, money laundering and tax evasion. But it must also be used in the right way. In the future, the EU should fight corruption much more decisively. That is why I have set up an Intergroup against corruption in the European Parliament.