As an extraordinary summit of European heads of state is coming, the President of the Council of the European Union is suggesting the possibility of making the financing of the Recovery plan conditional on European governments respecting the Rule of law.

Charles Michel – who is the President of the Council of the European Union – made this proposal on the 10th July. Far from being new, this proposal was supported by the European Commission as early as 2018 and is now supported by the Netherlands. This would mean that countries that do not comply with the European Union’s requirements in terms of the Rule of law could be deprived of all or part of the European funding of the Recovery Plan. The Plan is about 750 billion euros, including 250 billion euros in loans and 500 billion euros in grants.

This proposal is supposed to be a consensus. Indeed, the Rule of law is recognized as a fundamental value of the EU in the Treaty on European Union; and it is also protected and supported under various EU instruments: the Cooperation and Verification Mechanism, the Structural Reform Support Service, the Justice programme, external cooperation instruments, etc.

However, Poland and Hungary are strongly opposed to this proposal. Indeed, the two governments have been regularly accused of undermining the Rule of law in recent years. Both governments are accused of carrying out reforms which undermines the independence of the judiciary power. The Commission has launched infringement procedures against both countries.

In response to Charles Michel’s proposal, on the 14th July, the Hungarian Parliament adopted a resolution making the country’s support for the recovery plan conditional on the abandonment of a conditional Recovery plan.

The extraordinary summit of EU heads of state, to be held on 17 and 18 July, will be the scene of intense negotiations. Moreover, the points of contention are numerous; such as the amount of the recovery plan, which dissatisfies the “frugal States” in favour of fiscal sobriety.