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EU lists rule of law concerns for Hungary, Poland, pivotal in releasing COVID funds

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The European Commission has listed serious concerns about the rule of law in Poland and Hungary in a report that could help decide whether they receive billions of euro in EU funds to help recover from the coronavirus pandemic, writes Jan Strupczewski.

The European Union's executive arm also gave Poland until Aug. 16 to comply with a ruling by the top EU court last week, ignored by Warsaw, that Poland's system for disciplining judges broke EU law and should be suspended. Read more.

If Poland does not comply, the commission would ask the EU court to impose financial sanctions on Warsaw, commission Vice President Vera Jourova told a news conference.

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The commission had already raised many of the concerns in a report last year but they may now have real consequences as Brussels has made access to its recovery fund of grants and loans worth a total 800 billion euros conditional on observing the rule of law.

The commission said Poland and Hungary were undermining media pluralism and court independence. They are the only two countries in the 27-member bloc under formal EU investigation for jeopardising the rule of law.

"The Commission may take into account the Rule of Law report ... when identifying and assessing breaches of the principles of the rule of law that affect the financial interests of the Union," the commission said in a statement.

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Polish government spokesman Piotr Muller said on Twitter the government would analyse documents from the commission regarding the need for compliance with EU court rulings.

Hungarian Justice Minister Judit Varga said on Facebook the commission was blackmailing Hungary because of a child protection law which won't allow "LGBTQ-activists and any sexual propaganda into Hungarian kindergartens and schools".

The EU executive has already delayed its approval on 7.2 billion euros for Hungary in an attempt to win rule of law concessions from Prime Minister Viktor Orban's government and has not yet given the go-ahead for 23 billion euros in grants and 34 billion in cheap loans for Poland.

Jourova said she could not predict when money for Poland could be approved and noted Warsaw had first to convince the commission that it had a credible system of control and audit for spending EU money.

The report said Hungary had not followed the commission's request to strengthen judicial independence and that its anti-corruption strategy was too limited in scope.

In a decade in power, Orban has partly used billions of euros of state and EU funds to build a loyal business elite which includes some family members and close friends.

The commission cited persistent shortcomings in Hungarian political party financing and risks of clientelism and nepotism in high-level public administration.

Significant amounts of state advertising go to media supporting the government, while independent outlets and journalists face obstruction and intimidation, it said.

The report also expressed concern over the influence of Poland's nationalist ruling Law and Justice party (PiS) over the justice system.

It listed what it said were illegally made appointments and changes by PiS to the constitutional tribunal and other bodies, and Warsaw's rejection of EU court rulings binding for every member state.

The commission noted that the prosecutor general, responsible for tracking down state corruption, was at the same time Poland's justice minister and an active PiS politician.

Since last year, the professional environment for journalists in Poland has deteriorated because of "intimidating judicial proceedings, growing failure to protect journalists and violent actions during protests, including from police forces", it said.

European Commission

Poland ordered to pay the European Commission half a million euro daily penalty over Turów mine

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The European Court has placed a daily fine of €500,000 on Poland to be paid to the European Commission over its failure to respect an order from 21 May to stop extraction activities at Turów open-cast lignite mine, writes Catherine Feore.

The mine is located in Poland, but is close to the Czech and German borders. It was granted a concession to operate in 1994. On 20 March 2020, the Polish climate minister granted permission for an extension to lignite mining until 2026. The Czech Republic referred the matter to the European Commission and on 17 December 2020, the Commission issued a reasoned opinion in which it criticized Poland for several breaches of EU law. In particular, the Commission considered that, by adopting a measure allowing a six-year extension without carrying out an environmental impact assessment, Poland had breached EU law. 

The Czech Republic asked the court to make an interim decision, pending the final  judgment of the Court, which it granted. However, since the Polish authorities failed to comply with its obligations under that order, the Czech Republic, on 7 June 2021, made an application seeking that Poland be ordered to pay a daily penalty payment of €5,000,000 to the EU budget for failure to fulfil its obligations. 

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Today (20 September) the court rejected an application by Poland to overturn the interim measures and ordered Poland to pay the Commission a penalty payment of €500,000 per day, one tenth of what was requested by the Czech Republic. The Court said that they were not bound by the amount proposed by the Czech Republic and thought the lower figure would be adequate to encourage Poland “to put an end to its failure to fulfil its obligations under the interim order”.

Poland claimed that the cessation of lignite mining activities in the Turów mine could cause an interruption in the distribution of heating and drinking water in the territories of Bogatynia (Poland) and Zgorzelec (Poland), which threatens the health of the inhabitants of those territories. The court found that Poland had not sufficiently substantiated that this represented a genuine risk.

Given Poland’s failure to comply with the interim order, the Court found that it had no choice but to impose a fine. The CJEU has underlined that it is very rare that a member state brings an action for failure to fulfil obligations against another member state, this is the ninth such action in the history of the Court.

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€7 billion for key infrastructure projects: Missing links and green transport

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A call for proposals launched under the Connecting Europe Facility (CEF) for Transport programme is making €7 billion available for European transport infrastructure projects. The majority of projects funded under this call will help to increase the sustainability of our overall transport network, putting the EU on track to meet the European Green Deal objective of cutting transport emissions by 90% by 2050.

Transport Commissioner Adina Vălean, said: “We are massively increasing funds available for deployment of alternative fuels infrastructure, to €1.5 billion. For the first time, we are also supporting projects so that our trans-European transport networks are suitable for civilian-defence dual-use and improve military mobility across the EU. Projects funded under yesterday's call will contribute to the creation of an efficient and interconnected multimodal transport system for both passengers and freight, and the development of infrastructure to support more sustainable mobility choices.”

The EU needs an efficient and interconnected multimodal transport system for both passengers and freight. This must include an affordable, high-speed rail network, abundant recharging and refuelling infrastructure for zero-emission vehicles, and increased automation for greater efficiency and safety. Further information is available online.

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European Commission

REACT-EU: € 4.7 billion to support jobs, skills and the poorest people in Italy

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The Commission has granted €4.7 billion to Italy under REACT-EU to encourage the country's response to the coronavirus crisis and contribute to a sustainable socio-economic recovery. The new funding is the result of the modification of two operational programs of the European Social Fund (ESF) and the Fund for European Aid to the Most Deprived (FEAD). The Italian national ESF program ‘Active employment policies' will receive €4.5bn to support employment in the areas most affected by the pandemic.

The additional funds will increase the hiring of young people and women, allow workers to participate in training and support tailor-made services for job seekers. In addition, they will help protect jobs in small businesses in the regions of Abruzzo, Molise, Campania, Puglia, Basilicata, Calabria, Sicily and Sardinia.

Employment and Social Rights Commissioner Nicolas Schmit said: “The European Union continues to help its citizens overcome the COVID-19 crisis. The new funding for Italy will help create jobs, especially for young people and women, in the regions most in need. Investments in skills are another priority and are essential to master the ecological and digital transitions. We are also paying special attention to the most vulnerable people in Italy by strengthening the funding of food aid."

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Cohesion and Reform Commissioner Elisa Ferreira (pictured) said: “Regions are at the heart of Europe's recovery from the pandemic. I am delighted that member states are using the Union's emergency aid to tackle the pandemic and initiate a sustainable and inclusive recovery for the long term. REACT-EU funding will help Italians in the worst-hit regions recover from the crisis and create the foundations for a modern, forward-looking economy. As part of NextGenerationEU, REACT-EU is providing additional funding of €50.6bn (at current prices) to cohesion policy programs during 2021 and 2022 to support labor market resilience, jobs, small and medium-sized businesses and low-income families."

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