“Today’s agreement is an important step in protecting EU values. For the first time, we have established a mechanism that allows the EU to stop funding governments that do not respect values such as the rule of law, “said Finnish co-rapporteur Petri Sarvamaa, a member of the EPP group, after the negotiations, according to the source.
We have not compromised on values and we have made sure that the rule of law is respected by all EU member states, Sarvamaa added.
“We have not compromised on value: we have made sure that the rule of law is seen in the context of EU values enshrined in treaties, such as the independence of the judiciary. Every violation of the rule of law will be covered by this mechanism: from individual violations to systemic or recurrent violations for which there is no mechanism so far “, added the Finn.
For her part, Spain’s co-rapporteur Eider Gardiazabal Rubial, who is part of the S&D group, said it was crucial that final beneficiaries would not be punished for government mistakes and would continue to receive funding they could rely on, even after what triggered the conditioning mechanism.
“It was crucial for us that the beneficiaries were not punished for the mistakes of their governments and that they will continue to receive the promised funds and will be able to rely on them, even after the conditionality mechanism is triggered. We can proudly say that we have obtained a strong system that will guarantee their protection “, said Eider Gardiazabal Rubial.
The agreement is to be formally adopted by the European Parliament and EU ministers, the source said.
MEPs have managed to ensure that the new rule is not only applied when EU funds are used for other purposes, such as corruption or fraud. The mechanism will also be applied to systemic issues related to the fundamental values of the EU that all Member States must respect, such as freedom, democracy, equality and respect for human rights, including the rights of minorities.
EP negotiators also insisted that tax fraud and tax evasion be considered possible violations, including both cases and widening the area and recurring problems.
Furthermore, the European Parliament’s negotiators have succeeded in introducing a specific article that clarifies the issues related to infringements by providing some examples, such as situations that threaten the independence of the judiciary, or failure to correct arbitrary or unfair decisions and limiting remedies .
Crucially, MEPs managed to keep a strong preventive aspect of the mechanism: not only can it be triggered when the breach directly affects the budget, but also when there is a serious risk that this could happen, thus ensuring that the mechanism prevents possible situations in which EU funds could finance actions that conflict with the values of the European Union.
To ensure that the final beneficiaries who depend on EU support – such as students, farmers, non-governmental organizations and are not punished for government actions, MEPs insisted that they can make complaints to the European Commission online, and the institution will help to receive the due amounts. The European Commission will also have the opportunity to make financial corrections by reducing the future rate of EU support to the country.
MEPs have managed to shorten the time the EU institutions will have in taking action against a Member State, if risks of violating the rule of law are identified, to a maximum of 7-9 months (compared to 12-13 months, as originally requested by the EU Council).
The Commission, after finding that there is a breach, will propose to launch the conditionality mechanism against a government of an EU Member State. The Council will have one month to adopt the proposed measures (or three months in exceptional cases) and the decision will be taken by a qualified majority. The Commission will use its rights to convene the Council to ensure that the deadline is met.
On 23 July, the European Parliament adopted a resolution stating that it would not approve the 2021-2027 multiannual budget drawn up by the European Council if the proposal was not improved. The EP argues that the EU’s long-term budget is making cuts to certain future programs and considers that this “will undermine the foundations of a sustainable economic recovery”. The institution also points out that the Council’s proposal does not establish a clear mechanism for making EU funds conditional on the rule of law.