ECJ (NOT VAT) C-156/21 & C-157/21 (Hungary & Poland vs Parliament & Council) – Principles, objectives and tasks of the Treaties

According to the European judges, who gathered in full chambers for this judgment, linking financial support from the EU budget to respect for the rule of law is in line with European competences and the principle of legal certainty. The regulation does not confer any additional powers on the European Union.

The rule of law and solidarity are fundamental to the European legal order, the judges argue. The European Union must be able to defend those values. The budget of the European Union is one of the most important instruments for giving shape to that solidarity.

Poland and Hungary have been unsuccessful in this judgment . The two countries, against which several European proceedings are pending for disrespect for the rule of law and democracy, went to the EU Court of Justice last spring. They questioned the regulation adopted at the end of 2020 that allows financial sanctions against countries that do not respect fundamental values. Ten member states, including the Benelux, Germany and France and the three EU institutions, the Council, the European Commission and the European Parliament defended this conditionality mechanism.