EP votes to question Hungary's ability to credibly hold EU Council presidency

The European Parliament (EP) adopted its new resolution on Hungary by a large majority of 442 votes to 144, with 33 abstentions. According to the document, which has no legal consequences, "as a result of the government's systemic actions, the state of rule of law in Hungary has been deteriorating for years". This has not been properly addressed and, in addition, many new issues continue to arise.

The EP condemns the Hungarian government's "anti-EU communication campaigns" and its "deliberate and systematic efforts" to undermine fundamental EU values.

In view of next year's EP and local elections, it calls on the Hungarian government to implement the recommendations made by the Organisation for Security and Cooperation in Europe (OSCE), which is independent of the EU and includes Hungary among its members, following its observation of the last parliamentary elections.

The explanatory memorandum of the text mentions, among others:

• the status law;
• the use of special legal regimes for issuing decrees that have "little to do with the reasons for the imposition of the state of danger";
• one of those decrees allowing local authorities to hold public hearings without the citizens being able to attend in person;
• Hungary not having joined the EU Public Prosecutor's Office;
• the high number of irregularities in the spending of EU funds between 2017 and 2021;
• the cases blocking the bulk of EU funding after 2020, such as the conditionality procedure against Hungary, which was voted on by member states at the end of last year;
• the lack of social consultation on the judicial reform worth billions of euros and
• the fact that "this package does not allow for a review of recent political appointments at the highest levels of the country's judicial system".

The Orbán government has been in negotiations with the European Commission on the conditions required in exchange for the payment of a large part of the funds. The EP "deeply regrets that in some cases the impression has been given that certain legislative acts proposed by the Hungarian government or adopted by the Hungarian Parliament have been agreed with the Commission". It calls on the EU body to make an independent and objective assessment and "to refrain from any action or statements which might suggest that non-transparent negotiations or agreements influencing the official position of the institutions have taken place".

The House expects the European Commission to "ensure that the assessment of the legislation being drafted in Hungary is publicly available, follows only the publicly available draft and does not precede the public consultation". Adopted measures should only be withdrawn after concrete evidence has been provided to guarantee that the causes have been comprehensively addressed, i.e. that they have "proved effective in practice" and that there is no backtracking after their adoption. However, the EP also calls on the Commission to

"not deprive the final recipients or beneficiaries of these funds of the same".

The executive proposing body should "find ways to ensure that EU funds reach citizens, businesses, regional and local authorities, NGOs and other stakeholders instead of government organizations and other interested parties, in cases where the government fails to cooperate in addressing rule of law failures".

EU money is used to enrich government allies, the EP says

"In Hungary, there is serious pressure exerted on the pillars of the rule of law, in particular on prohibiting the arbitrary exercise of executive power", which has "led to discrimination and created a climate of fear". According to the EP, this undermines the EU's common market and "poses a serious threat to some businesses and their legitimate business interests". It is certain that

"persons known to be linked to a narrow circle of the prime minister or to his office" are using intimidation methods "to control parts of the Hungarian industry considered to be of "strategic importance".

The EP also “condemns systemic discriminatory practices against Hungarian companies in certain sectors, politically motivated business practices that give unfair advantages to competitors, opaque and manipulated public procurement procedures, the public bids for purchase made by the government and organisations linked to the prime minister, as well as

EU funds being used to enrich the government's political allies.”

According to the resolution, "businesses are increasingly concentrated in the hands of oligarchs linked to the current government, who have publicly indicated their intention to buy their way into" certain sectors.

They are questioning something that the government is already preparing for

As leaked last week, this resolution "raises the question of how Hungary will be able to credibly" hold the EU Council presidency in 2024. The body, which represents member states – ministers at the top, the permanent representation of the countries in Brussels, and the working groups at the bottom – usually decides on EU legislation together with the EP, sometimes alone. Member states rotate presidencies every six months, with Hungary currently due to take over in July 2024.

The EP argues that Hungary "doesn't comply with EU law", with the core values enshrined in the EU's quasi-constitution and with the principle of "loyal cooperation". MEPs are thus calling on the Council to "find an appropriate solution as soon as possible", otherwise "the Parliament may take appropriate action".

While there does not appear to be any legal method that MEPs can use beyond the resolution, some practical tools have been proposed – read more on that here. Ultimately, it is up to member states to decide whether the Hungarian government can follow through with the presidency, and some countries have already expressed concerns – which we reported on here.