The budget conditionality regulation does not require any additional clarification and rule of law breaches must be addressed as soon as possible.

In a resolution adopted on Thursday with 529 to 150 and 14 abstentions, MEPs regret that the Commission has decided to abide by the non-binding December 2020 European Council conclusions and delay the application of the budget conditionality regulation by developing application guidelines.

Guidelines should not restrict the law

MEPs stress that the guidelines cannot alter, expand or restrict the text of the budget conditionality regulation. In order to add any value, they must clarify how the legislative provisions will be applied in practice, outlining the procedure and methodology while avoiding exhaustive definitions of the abstract concepts contained within the regulation.            They also call on the Commission to set out a “clear, precise and user-friendly system” for submitting complaints under the regulation.

Rule of law breaches must be addressed without delay

MEPs call on the Commission to investigate quickly any potential breaches of the principles of the rule of law “that affect or seriously risk affecting the sound financial management of the Union budget”, by pointing out that “the situation in some member states already warrants immediate action”.                                                                                            The Commission should report to Parliament on the first cases under investigation as soon as possible, they add.

Parliament could take legal action against the Commission

MEPs criticise the Commission for having missed the 1 June 2021 deadline set by Parliament to apply the regulation and adopt the guidelines. They welcome the 23 June letter by the President of Parliament saying that if the Commission does not act, the EP will take action in the Court of Justice and add that the Parliament has to continue its necessary preparations under Article 265 of the TFEU against the Commission for “non-action”.

“People are worried about their liberties, minorities are supressed, free media are shut down or bought by government oligarchs, judicial systems are party-politicised and independent judges are replaced by party loyalists. All this is done with EU money and should not be happening in Europe in 2021”, said the co-rapporteur Petri Sarvamaa (EPP, FI) in the debate ahead of the vote. “Parliament has therefore launched the legal procedure so that the Commission applies the Rule of Law conditionality regulation from autumn onwards”, he added.                                                                                                        “Again we find ourselves talking about the rule of law conditionality mechanism. But when will we finally see some action? The mechanism came into force on 1 January, and yet it hasn’t been implemented”, said co-rapporteur Eider Gardiazabal Rubial (S&D, ES). (S&D, Spain) during the debate. “From the beginning we were very clear that these guidelines were not needed. We agreed on a regulation and we expect it to finally be applied.”

The budget conditionality regulation is the only piece of EU legislation linking the respect of the rule of law to access to EU funds. It entered into force on 1 January 2021. However, no measures under it have been proposed yet. The European Council asked the Commission to delay the application of the regulation while member states challenge it in the EU Court of Justice (Poland and Hungary did so on 11 March 2021), and until the Commission had developed specific application guidelines.In a resolution adopted in March 2021, Parliament said that the application of the new regulation cannot be subject to any guidelines.