Refusing to make any concessions on the rule of law, MEP Domènec Ruiz Devesa (S&D, Spain), believes it is possible to get around the Hungarian and Polish obstruction of the 2021-2027 Multiannual Financial Framework (MFF) (see EUROPE 12605/1). According to him, several articles of the Treaty on the Functioning of the European Union make it possible, without requiring unanimity of the Member States, to move forward and implement the European Recovery Plan, from which Hungary and Poland would also benefit. (Remarks collected by Mathieu Bion)
Agence Europe – Should a drop of the Hungarian and Polish vetoes, allowing the MFF, the European Recovery Plan and the mechanism linking EU financial aid to respect for the Rule of law, be ruled out from the outset?
Domènec Ruiz Devesa – We will see at the December European Council. This is possible, if Poland and Hungary accept the Recovery Plan without any concession on the question of the Rule of law.
However, if the Council seeks to weaken the issue of the Rule of law, we will have the same problem in reverse: Parliament may not vote for the multiannual budget.
Some things can be clarified. For example, a State, after being sanctioned by the ‘Rule of law’ mechanism, has the right to go to the Court of Justice of the EU.
We have Rule of law at European level, as well.
How valid is the Slovenian argument that it should be for the Court to determine whether the Rule of law has not been respected?
In the abstract, if we think of the Commission as a national government, it would be wrong for the executive to monitor the application of the rule of law, if I understood the position of the Slovenian Prime Minister correctly.
On the other hand, in the EU institutional framework, it is very clear that the European Commission is the executive and that it is also the guardian of the Treaties and consequently of the article on fundamental rights.
I believe that the Commission is well placed to identify a situation in which a Member State violates fundamental values and the Rule of law.
According to the agreed mechanism, it is for the EU Council to decide by qualified majority of Member States. And there is always the possibility that the Member State concerned may go to the Court of Justice.
How can the current obstruction be circumvented, as the Treaty currently stands?
I am taking over the elements of the Recovery Plan that are currently blocked, such as the Recovery and Resilience Facility, and putting them in place without the two elements – the Own Resources Decision and the MFF – that are missing.
Using Article 122(2) of the Treaty as a legal basis, it is possible to provide exceptional assistance to Member States, through a debt issue, without the agreement of Hungary and Poland. This is a very important first point.
A solution must then be found for the missing element, i.e. the ‘own resources’ decision. Raising the own resources threshold would make it possible to give an assurance that we will always be able to pay the debt contracted. However, if the Plan continues to be blocked, we do not have this element which requires unanimity of the Member States.
Nevertheless, Article 310(4) of the Treaty allows decisions with financial implications for the budget to be adopted. So we could, without changing the own resources decision, contract a debt which will have an impact on the various annual budgets with the entry of a budget line to pay part of the capital and interest.
The only thing we need to do is to show that over the period of the debt amortisation, 30 or maybe 40 years, we have the margin between our expenditures and our own resource limits to pay for the amortisation. Because if the debt amortisation costs exceed the budgetary margin in one year, there will be a problem.
This is the most logical interpretation of Article 310(4). It does not say that assets must be of the same value as the debt at the time the debt is incurred. That is the interpretation of the Council’s legal service.
In addition to this, it is possible to adopt the 2021 budget on the basis of the current extended MFF by qualified majority of Member States. We therefore have sufficient instruments to at least set up the European Recovery Plan.
Could this proposal be challenged?
Yes, some States can always go to the Court of Justice. It is a risk. But what is the alternative? Not implementing the Recovery Plan because of the risk of litigation?
Our interpretation of Article 310(4) is very literal. There is no prohibition in the Treaty on issuing debt. Nor is there this idea of having an asset of the same value at the time the debt is issued.
That is the interpretation of the Council’s legal service. That is very nice, but Article 310(4) does not require it. This works very well in a very orthodox interpretation of economics.
Some people, such as Guy Verhofstadt, advocate the establishment of enhanced cooperation among the 25 Member States to move forward with the Recovery Plan...
I talked about it with Guy. Those are two possibilities.
But, for me, there is more added value if we continue with the Community method altogether. In this way, we show that we can do things without unanimity while respecting the Treaties. And Hungary and Poland remain beneficiaries of the Recovery Plan, because we do not want to penalise their citizens.
Moreover, in the option I am defending, the role of the European Parliament is assured. With enhanced cooperation, on the other hand, we must carve out a role for Parliament, for example in an interinstitutional agreement. That takes time.
Within the framework of enhanced cooperation, the participating countries shall act unanimously. Poland and Hungary can ask to join it and block it from the inside. A way should then be found to ensure that the two countries do not join this enhanced cooperation. That would pose other legal problems.
The priority must therefore be, in order: – save the Recovery Plan via Articles 122(2) and 310(4); – enhanced cooperation; – and an intergovernmental solution.