The origin of the problem
The continuous challenging of the rule of law, the judicial independence, the primacy of the EU law and the LGBTI rights are some of the problems that are affecting the relation of these two countries with the EU.
Poland adopted a disciplinary regime for Supreme Court, Judges and Ordinary Courts, creating a new Disciplinary Chamber within the Supreme Court with those competencies, which, according to the European Commission, does not guarantee the principles of independence and impartiality, and they also banned LGBTIQ content and books that portrays homosexuality for individuals under 18 and even the Poland’s Constitutional Tribunal rejected the principle of the primacy of EU law over national legislation in certain judicial matters.
On 27 of October, the European Court of Justice (ECJ) in C-204/21 R ordered Poland to pay the European Commission €1 000 000 as a daily penalty payment due to the rule of law dispute as it was established by the order of 14 July 2021 concerns interim measures, compliance with which is necessary to avoid causing serious and irreparable harm to the legal order of the European Union and, consequently, to the rights which individuals derive from EU law and the values, set out in Article 2 TEU, on which that Union is founded, in particular, that of the rule of law.
Furthermore, the ECJ ruled that Poland’s new Regulations for appointing judges to the Supreme Court could violate EU law and on 15 July 2021, it ruled in its judgment in Case C-791/19 that the disciplinary regime for judges in Poland is not compatible with EU law.
Hungary, from its part, is involved with a serious breach of the values of the Union by the Constitution, adopted in 2011, and some internal reforms that changed the prerogatives of the Constitutional Court and the powers of the president, along with the immigration crisis and some national judgements that did not respect the rule of law.
The recent dispute regarding the rule of law between Hungary and the EU took place in the relevant ECJ Judgment of the 23 November 2021, in Case C-564/19, where, it was ruled that the Hungarian’s Supreme Court had improperly interfered with and disciplined a lower court judge. Since this declaration of illegality can easily restrict the adequate judicial protection of individuals’ rights from EU law. The ECJ has been based its decision on the principle of the importance of EU law, which sometimes allows the lower court to disregard the conclusion of the supreme court of the Member State concerned when that decision is contrary to EU law (Article 267 TFEU).
Do Hungary and Poland indeed want to exit the EU?
This continuous list of infractions against the rule of law and the fundamental values and principles of EU law has led the European Commission to deliberate, on several occasions, on a possible application of the mechanism of the Article 7 TUE.
Lately, rumours of a possible exit of Hungary from the EU, a great ally of Poland, have grown after a speech by Prime Minister Viktor Orban, where he considers that the EU is attacking Hungary and Poland with the excuse of the rule of law. However, there is no official news yet about the possible exit, they only want to keep their sovereignty and they are asking for a comprehensive tolerance and integration.
The “Conditionality Regulation” and the cases C-156/21 and C-157/21
The next step that that EU took was the cut of funding to these two countries, leaning on the Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council of 16 December 2020 on a general regime of conditionality for the protection of the Union budget, known as a “conditionality regulation”, in force since January 2021. This new mechanism allows the EU to take measures such as the suspension of payments or financial corrections to protect the Union budget in case of serious breaches of the rule of law principles by some Member States that may affect or risk the EU financial interests.
Poland and Hungary in Case C-156/21 and Case C-157/21 brought an action for annulment in which they requested the ECJ to annul the aforementioned Regulation understanding that it is incompatible with Article 7 TEU and the principle of legal certainty.
On 2 of December 2021, Advocate General Campos Sánchez-Bordona gave an opinion in these two cases, where he considered that the ECJ should dismiss these actions for annulment, since the Article 7 TEU, a mechanism to ensures that all EU countries respect the shared values of the EU, does not authorise the EU legislature to introduce another similar tool to protect the rule of law that applies identical sanctions, and that therefore, this Regulation has no relation with article 7 TEU and the judgments of the CJEU related to the independence of national courts. The Advocate General also understands that the Regulation is compatible with Article 7 TEU and respects the principle of legal certainty, since it requires a sufficiently direct link between the breach of the rule of law and the implementation of the budget, with the result that it does not apply to all violations of the rule of law, only to those directly linked to the implementation of the Union budget.
The highly anticipated judgements of the ECJ in these cases (C-156/21 and C-157/21), regarding the principles of the EU law, will be heard in a Livestream this Wednesday 16 February with an important impact of the creation on some guidelines that will help to explain how the European Commission will apply the conditionality regulation and to clarify some elements related to the functioning of this Conditionality Regulation.
The hearing in these two cases has exceptional importance.
 Case C-204/21, R Commission v Poland  ECLI:EU:C:2021:878
 Case C‑791/19, European Commission vs Republic of Poland  ECLI:EU: C:2021:596
 Case C‑564/19, IS (Illegality of the order for reference)  ECLI:EU: C:2021:949
 Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council of 16 December 2020 on a general regime of conditionality for the protection of the Union budget  OJ LI 433/1
 Case C-156/21 Hungary v Parliament and Council  ECLI:EU: C:2021:974
 Case C-157/21 Poland v Parliament and Council  ECLI:EU:C:2021:978
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