On Wednesday 16 December 2020, the European Parliament adopted a regulation to protect EU funds from misuse by governments that violate the rule of law. The budgetary sanctions of this regulation, which will become applicable from 1 January 2021 to all types of funds, are aimed directly at offenders and not the final beneficiaries.
The Commission, after establishing that there has been an indivisual or systemic breach, will propose that the conditionality mechanism should be triggered against an EU government, and subsequently either cut or freeze payments to that member state from the EU budget.
The Council will then have one month to vote on the proposed measures (or three months in exceptional cases), by a qualified majority.
MEPs succeeded in shortening the time that the EU institutions will have to adopt measures against a member state, if risks of breaches of the rule of law are identified, to a maximum of 7-9 months (down from 12-13 months).
To ensure that the final beneficiaries who count and depend on EU support – such as students, farmers, or NGOs – are not punished for the actions of their governments, they will be able to file a complaint to the Commission via a web platform, which will assist them in ensuring they receive the due amounts. The Commission will also be able to make a financial correction by reducing the next instalment of EU support to the respective country in question.