Commission pushing Poland to accept rule of law milestones in recovery plan

The European Commission is ready to approve Poland’s recovery plan as soon as November if Warsaw will agree to certain legally binding objectives to restore the rule of law, according to officials familiar with the EU’s plan.

That would pave the way for the EU to pay out the first installment, amounting to 13 percent of the total, of Poland’s recovery package of almost €24 billion in grants.

Brussels’ plan is to link the disbursement of Poland’s EU recovery cash to legally binding “milestones” in which the government would commit to re-establishing the independence of the judiciary, officials told POLITICO’s Brussels Playbook. The Commission is also in negotiations with Hungary over its spending plan, with anti-corruption safeguards the main sticking point there.

At the same time, Brussels is poised to trigger the EU’s new rule of law conditionality mechanism — which effectively introduces financial sanctions on countries that don’t adhere to core EU principles on the rule of law and democratic processes.

In Poland, judicial reform is the main bone of contention. Warsaw has established a new disciplinary chamber that punishes judges for the content of their rulings. Earlier this year, the European Court of Justice, Europe’s highest court, ruled that chamber illegal because it undermines the independence of Polish judges.

But instead of adhering to that ruling, Warsaw opened another front with a court case challenging the primacy of EU law. In reaction, the Commission has delayed a decision to disburse funds to Poland from the pandemic recovery budget. Poland’s Constitutional Tribunal, which is hearing the challenge to EU law, on Thursday postponed its decision until October 7.

The milestones the Commission is envisioning for Poland’s recovery funds “will build on the ECJ’s ruling, meaning Poland’s disciplinary chamber needs to stop all action, and Warsaw should reform the chamber,” Vĕra Jourová, the commissioner for values and transparency, told POLITICO.

Warsaw would have to accept that it needs to meet those milestones to get the next tranche of EU cash. If it does, the Commission can accept Poland’s recovery plan and recommend the disbursement of a first tranche.

Poland has pushed back against the EU’s moves regarding rule of law. Polish Justice Minister Zbigniew Ziobro, author of the judicial reforms that included setting up the disciplinary chamber, last month labeled the Commission’s actions “aggression” and a “legal hybrid war.”

Jourová added that she did not want to penalize ordinary Polish citizens. “Brussels did not create this dilemma. It’s a domestic production for domestic political purposes,” she said.

Meanwhile, the Commission also has the new mechanism for rule of law conditionality.

“The preparations to trigger the rule of law conditionality are too advanced for us not to use them,” Jourová said. “The train is rolling at high speed and cannot be stopped.”

The European Parliament has ramped up pressure on the Commission to use its new weapon. It is likely Brussels will trigger the procedure on countries such as Poland and Hungary before October 25, when Parliament’s committee on budgetary control is due to meet.

The Commission’s deadline to adopt or reject Hungary’s spending plan passed on Thursday with no approval or rejection, leaving €7.2 billion in grants pending. Brussels is pushing for stronger anti-corruption measures in the plan.

Paola Tamma contributed reporting.

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