A document originating from the EU Council’s Legal Service, dated 23 March and seen by EUROPE, states that the EU Council has to lodge its statement of defence within two months of receipt of the notification of the application to the EU Court of Justice made by Poland and Hungary. The two States have requested the annulment of the Regulation relating to a general system of conditionality for the protection of the Union’s budget (see EUROPE 12686/7).
EU Member States may also intervene in these proceedings.
The European Parliament is also preparing to defend the validity of the Regulation before the Court.
By application lodged with the European Court of Justice on 11 March 2021 and notified to the EU Council on 12 March 2021, Hungary has brought an action for the annulment of this text that provides for the suspension of EU funds in the event that the Rule of law is violated by a Member State.
In its application, Hungary argues that the regulation should be annulled in its entirety on the basis of several pleas in law: lack of a valid legal basis for the Regulation; a procedure which circumvents and encroaches upon the one foreseen by Article 7 of the Treaty on the Functioning of the European Union; a text which violates the principle of legal certainty; provisions that are contrary to the principles of proportionality and legal certainty.
The Director General of the Legal Service of the Council of the EU appointed two people as agents of the EU Council in this case (C-156/21).
Poland’s application was also lodged with the Court on 11 March and notified to the EU Council the following day.
Poland has brought an action for annulment of this Regulation on the following grounds: - lack of a valid legal basis; - breach of the Protocol insofar as the protection of the Union budget would not be an exclusive jurisdiction of the Union and national parliaments should have been requested to submit opinions on the respect of the principles of subsidiarity and proportionality; - violation of Article 296 of the TFEU insofar as the duty to state reasons had not been respected and the co-legislators failed to demonstrate the relationship between the breaches of the Rule of law and the protection of the Union budget; - violation of the principle of proportionality; - procedure that would circumvent and encroach upon the procedure foreseen under Article 7 TEU; - breach of the principle of equal treatment of Member States; - violation of the principles of legal certainty.
Finally, Poland considers that all the arguments it has identified “would also show that the Regulation is vitiated by misuse of power insofar as it establishes a mechanism which is not meant to protect the Union budget, but to circumvent requirements applicable to the procedure under Article 7 TEU.
The Director General of the Legal Service appointed three people as agents of the EU Council in this case (C-157/21).
The Committee of Permanent Representatives of the Member States to the EU (Coreper) will take note of both documents on Wednesday 31 March.
Guidelines being prepared. The European Commission said on Monday 29 March that it is preparing guidelines that will explain in further detail how it will apply the regulation.
These guidelines will be finalised after the Court’s ruling “to be able to incorporate any relevant elements from these Court of Justice judgements”, said a spokesperson for the institution. He gave assurances that the European Commission had “started to follow up on certain cases”, as President Ursula von der Leyen had said.
Any infringement that takes place from 1 January 2021 onwards “will be covered in any case, and no case that comes to our attention after 1 January will be forgotten”, the Commission spokesperson concluded. (Original version in French by Lionel Changeur)