Poland’s contentious judicial reforms were discussed by European Union leaders in Brussels on June 26. Critics warned the reforms threaten the rule of law and put the courts under more political control.

Poland’s ruling conservatives, however, have refused more concessions over the sweeping changes, many already in place.

As reported by the Reuters news agency, Poland is increasingly isolated within the bloc and is squandering its leverage, including in negotiations over the EU’s next seven-year budget from 2021.

But the ruling Law and Justice (PiS) party’s recalcitrance also highlights how the EU struggles to bring back into line member states that flout its central principles.

“The Polish government has the right to reform the judiciary as long as this does not go at the expense of the independence of the judiciary,” said the European Commission’s deputy head, Frans Timmermans, who is leading the case against Warsaw.

Reuters noted Poland’s argument that the changes are needed to streamline a deeply inefficient court system and rid Poland of vestiges of communism.

In a separate report, Bloomberg noted that the EU is in uncharted territory regarding its standoff against Poland at a time when the bloc has to deal with new priorities such as immigration, security and its post-Brexit future.

The clash also carries a risk of a deepening rift over the bloc’s next multiannual budget, with Poland — the biggest net beneficiary of the current fiscal plan — having a veto over the total sum. Brussels proposed to tilt aid toward southern Europe, which would hit Poland and its post-communist neighbours.

The June 26 hearing reflects efforts to resolve the standoff without slapping penalties on Warsaw.

In an interview with Bloomberg, Laurent Pech, a professor of European law at Middlesex University in London, said: “The meeting is unlikely to result in Polish authorities suddenly showing some basic respect for the rule of law and not going ahead with their unconstitutional purge of the Supreme Court. Poland is winning but at a very high cost in terms of reputation and possibly an even higher cost with respect to the next EU budget.”