Unexpected Complications: The impact of the Russian invasion of Ukraine on the rule of law crisis in the EU

If somebody had asked me in late 2021 what events would define the rule of law crisis in the European Union in 2022, I would have said that the elections in Hungary would be the most crucial moment for the struggle for EU values. On 24 February 2022, Vladimir Putin made almost all predictions concerning European politics obsolete. Russia’s unjustified, brutal invasion of Ukraine not only obliterated an over 30-year-old paradigm of security on the continent but also had massive ripple effects on many aspects of European life, including the rule of law crisis in two EU Member States: Hungary and Poland.

Before Russia’s attack, the situation was more or less clear. The European Union, after many years of failed political dialogue with Hungarian and Polish authorities over their continued attacks on the independence of the judiciary, corruption and misuse of EU funds (Hungary) and challenging the authority of CJEU and ECtHR (Poland), had finally grown some teeth. Poland had been issued a record 1m EUR/day fine over ignoring an interim order from CJEU in the case C-204/21 concerning the Disciplinary Chamber of the Supreme Court and the “muzzle law”. The payout of the Resilience and Recovery Facility fund, EU covid-19 financial recovery mechanism, had been halted towards both Member States over the rule of law concerns. In November 2021, the European Commission was gearing up to launch the new rule of law conditionality mechanism towards both countries.

So far, Hungary and Poland have been close allies and friends at the EU level. With the blossoming fraternity between the conservative Eurosceptic governments of Fidesz and PiS, both countries relied on each other in several scuffles with the EU institutions, including the rule of law conflict. Hungary and Poland were poised to block the possible use of Art. 7  TEU against either country, since a vote on that procedure’s strongest sanction, a deprival of a Council vote, would in itself require unanimous agreement in the Council. Thus, Hungary could veto action against Poland and vice versa. Both countries first agreed to establish the EU rule of law conditionality mechanism and then challenged its legality before the CJEU, with the Court ruling against both challenges. The rule of law friendship was so close that both Member States unveiled plans to establish a joint research institute to promote „alternative” approaches to the rule of law that would run contrary to the „EU mainstream”.

Then the bombs fell on Kyiv.

One war, two loyalties

The Hungarian-Polish friendship was ultimately tested not by the resolve of EU institutions but by Vladimir Putin’s brutality. Poland, Russia’s traditional rival, threw its entire weight behind Ukraine’s survival and victory. The country that, at the same time, was busy pushing back irregular migrants on the border with Belarus blew its doors wide open for millions of Ukrainians fleeing the Russian onslaught. Moreover, Warsaw flexed its military and diplomatic muscle, transferring a substantial amount of heavy weapons to Ukraine and advocating for the suspension or removal of Russia from multiple international organisations and fora, leading, among others, to the country’s spectacular expulsion from the Council of Europe.

The Hungarian reaction was a night to Poland’s day, as the Fidesz government revealed what many suspected for a long time, namely that its loyalties were less with its neighbours and European allies and more with Russia. While Hungary stopped short of blocking EU sanctions on Russia, it has provided Ukraine with insignificant humanitarian aid, refused to offer any military support and continued to court Russian initiatives in the trade and energy sectors. The narrative of the Hungarian government, that the EU sanctions against Russia are ineffective and that the conflict needs to be resolved through an implied Ukrainian surrender, was met with shocked disgust by virtually the entire bloc.

The Commission reacts

The divergence in reaction to the Russian attack posed not only issues for Budapest and Warsaw, as the close friendship frayed quickly, and multiple ambitious joint projects, including the abovementioned rule of law institute, appear to have been put on ice or scrapped entirely. It also posed a massive problem for the European Commission. Berlaymont was suddenly faced with two Member States rogue on the rule of law, but one of them became a champion in supporting Ukraine and carrying the weight of joint action against Russia, while the other turned into a proverbial black sheep of the EU27 herd. Faced with this situation, the European Commission began to adjust its approach. Unfortunately, despite laying down all the groundwork for initiating the rule of law conditionality regulation against both Member States, the Commission ultimately triggered it solely towards Hungary. This move was quite blatantly an attempt to balance the pressure on Poland with the potential fallout of the Commission being perceived as mounting financial strain on a country carrying a significant part of the collective effort to aid Ukraine.

This approach, while on some level understandable, had an impact beyond lessening the already mounting financial pressure on Warsaw. In November 2021, the Commission sent informal letters to Hungary and Poland indicating the areas of concern it aimed to tackle using the rule of law conditionality procedure. In the case of Hungary, those informal communications translated pretty much directly to the content of actual letters triggering the rule of law conditionality mechanism against the country. Regarding Poland, the informal letters indicated that the Commission would use the conditionality procedure to tackle an area of the Polish rule of law crisis it did not address previously, namely the condition of Polish public prosecutors. Their lack of autonomy towards their superiors, chiefly the Prosecutor General/Minister of Justice Zbigniew Ziobro, the rampant politicisation of prosecutorial activity and the persistent harassment against prosecutors critical of the government are all significant problems that the Commission did not address in other proceedings. With the Commission deciding to forego the use of the mechanism towards Warsaw, a significant opportunity to finally address the problem of Polish prosecutors was lost.

At the same time, the Commission negotiated with the Polish government on a set of conditions, called milestones, to approve the Polish RRF spending plan and then transfer the funds. In parallel, the Polish parliament adopted a new law on the Supreme Court, authored by President Andrzej Duda, which foresaw the dismantling of one of the most problematic elements of the Polish rule of law crisis – the Disciplinary Chamber of that Court. The new Chamber, while an improvement, remains problematic due to the presence of “new” judges appointed with the participation of the politically captured National Council of Judiciary. Nevertheless, the Commission approved the Polish RRF and agreed on a set of milestones with the Polish government, including i.a. the obligation to review the status of judges suspended from work by the Disciplinary Chamber. For a moment, it seemed that Polish efforts had been rewarded with a big victory in the rule of law struggle, but then suddenly, the Commission declared that Polish efforts did not go far enough and that the payout of RRF was halted, leaving Warsaw scrambling for solutions that it had not been able to come up with so far.

Regarding Hungary, the Commission pushed on with the rule of law conditionality procedure and continued negotiating on the recovery fund. Here, the economic trajectories were on Berlaymont’s side; with Hungary noting record inflation and a spectre of a full-blown recession, the government in Budapest became anxious to get their hands on the recovery fund. Ultimately, on 30 November 2022, the Commission endorsed the Hungarian recovery fund, with a payout based on “super milestones” indicating significant legislative and policy adjustments towards addressing corruption, misuse of EU funds and the judiciary, and recommended the Council to freeze 7.5b EUR of Hungary’s EU funding under the rule of law conditionality procedure.

Rule of law in the shadow of war

Viktor Orban, aware that his standing with European democracies is slipping and that his continued capture of the Hungarian state and its institutions will only make relations with countries that respect the rule of law more difficult, seemingly bet his chances on a swift Russian victory. But his calculations were wrong, just like those of uncountable experts who predicted a quick defeat of Kyiv. As Russian blitzkrieg turned into a catastrophic slog, Orban dug in, apparently still believing that Vladimir Putin would prevail. But it seems that the prospects for that are slipping, and the patience of Budapest’s partners in the EU has worn out. This, in turn, has emboldened the Commission to undertake an awkwardly flawed yet welcome decision to recommend a cut to Hungary’s funding. Unfortunately, the fundamental error in the design of the European Union is now evident; the veto power of one Member State that has in many ways gone rogue is threatening to derail the entire European project at a critical junction. The EU needs to tread carefully now, as Orban’s resistance could make further attempts to aid Ukraine and punish Russia much more complicated, if not impossible.

Concerning Poland, the Commission’s dilemma is understandable – how far can one push a country that has sacrificed and risked so far to aid its neighbour in a war against a nuclear power that too shares a border with Poland? It’s lamentable that the Commission decided against moving forward with the conditionality mechanism against Warsaw. Still, the reasons for that are simultaneously wrong and understandable. Berlaymont almost went too far in its determination to reward Polish solidarity with transferring the RRF funds, but fortunately, it did an awkward 180 degrees turn when it finally realised that the dynamics within the Polish ruling coalition put Warsaw in an impossible bind. With one coalition partner, Kaczyński’s PiS, desperate to unlock the recovery fund and use it to shore up a battered economy and the other partner, Ziobro’s United Poland, willing to go the anti-EU road all the way, the ruling alliance became as toxic as the Hungarian-Polish friendship. With the 2023 parliamentary elections looming and Polish finances taking an increased battering, the government is running out of time and options. A recent decision by the new Chamber of the Supreme Court to unsuspend judge Igor Tuleya, an icon of Polish judicial resistance against the rule of law backsliding, is a good sign of EU pressure working. But more judges are still suspended, and even if the EU scores a victory regarding disciplinary harassment of judges, there are many other elements of the rule of law crisis in Poland that need urgent attention. The battle for the Polish rule of law is far from over.