The advocate general for the European Union’s highest court has recommended that the court annul a 2023 European Commission decision that released billions in funding to Hungary, funds which had previously been suspended due to concerns regarding the rule of law and corruption. In 2022, the European Commission suspended financial transfers to Budapest, citing democratic backsliding under Hungary’s right-wing populist government, as well as failures to address corruption and to ensure judicial independence effectively.
In 2023, the Commission concluded that the Hungarian government had undertaken sufficient reforms to warrant the release of approximately €10.2 billion. However, in a non-binding opinion issued on Thursday, Advocate General Tamara Ćapeta urged the European Court of Justice to invalidate the decision to unfreeze these funds, arguing that Hungary had not completed the necessary judicial reforms by the time the funds were released. While such opinions are not legally binding, they are often followed by the court.
Hungary, as a significant net recipient of EU funding, has faced increasing scrutiny for diverging from established democratic norms. The European Commission has accused Hungarian Prime Minister Viktor Orbán, who has held office since 2010, of undermining democratic institutions, exerting control over the media, and infringing upon minority rights. Orbán has consistently rejected these allegations, characterising them as unwarranted interference in Hungary’s sovereignty.
The Commission’s initial suspension of funds was driven by concerns regarding public procurement practices, including state purchases of goods and services funded by the EU, which raised fears that these contracts may have facilitated the diversion of EU funding to businesses linked to politically favoured individuals.
In 2024, the European Parliament challenged the Commission’s decision to release funds, asserting that the Commission had erred in its assessment of Hungary’s eligibility. In her opinion, Ćapeta indicated that the Commission had “incorrectly applied the requirements imposed on Hungary when it permitted, without any explanation, the disbursement of the budget before the required legislative reforms had entered into force or been applied.”
Currently, billions in additional EU funding remain frozen, resulting in a significant budget shortfall that has contributed to prolonged economic stagnation in Hungary. Orbán, who advocates greater authority for national governments within the EU framework, has accused the bloc of interfering in Hungary’s internal affairs and of using the distribution of funds as a form of coercion.
As Hungary approaches the April elections, Prime Minister Viktor Orbán faces a significant challenge from Péter Magyar of the Tisza party, who is leading in opinion polls. Magyar promises to restore democratic institutions, improve the EU relations, and speed up the release of frozen funds.
This article used information from The Associated Press.
