The EU’s top court has dismissed a complaint filed by Poland and Hungary against a mechanism allowing Brussels to punish member states it deems ‘rule-of-law violators.’ The so-called “conditionality mechanism” gives the bloc the right and power to withhold aid funding from a member that is found to be failing to adhere to the union’s democratic principles.
“The court dismisses the actions brought by Hungary and Poland in their entirety,” the European Court of Justice (ECJ) said in a statement on Wednesday.
The ECJ also argued that the democratic values countries should comply with to join the EU cannot be simply “disregarded” after accession. It also said that a member state committing rule-of-law violations might “seriously compromise” what it called the “sound financial management” of the EU budget and the bloc’s “financial interests.”
The court’s decision might see Hungary and Poland losing tens of billions of dollars in aid from Brussels. Warsaw and Budapest argued that such a move on the part of the EU is devoid of any proper legal basis. Both nations, each of which receives large portions of EU funding, have been at odds with the bloc over what the EU calls violation of its democratic principles, ranging from consolidating the government’s control over the judiciary to cracking down on the freedom of the media.