Press stories report that Hungarian and Polish governments are prepared to drop their veto to the multiannual financial framework (MFF) and corona recovery package. But only if all EU governments agree to an ‘interpretative declaration’ setting out how the conditionality mechanism will work in practice. This might seem like a minor concession, but it risks rendering the mechanism toothless.

First, the interpretative declaration will severely limit when the mechanism can be used

Fidesz and PiS want to make sure that the mechanism can only be activated in relation to corruption or fraud affecting EU money. They say that this is to avoid the mechanism being activated in relation to human rights violations against LGBTQI persons or people who migrate.

At an academic level, this is meaningless, because an interpretative declaration isn’t legally binding. The text of the conditionality proposal says the mechanism can be activated in broader circumstances. That’s because it defines ‘rule of law’ to include the ability to go to court for violations of fundamental rights, including non-discrimination. Which means that if a government starts systematically stripping away human rights protections, the Commission would have grounds to activate it. So, if the mechanism was activated and a government took the Commission to court over it, the CJEU would take this declaration into account but it would give priority to the text of the law.

The question is more a political than a legal one: having signed up to a declaration that says ‘we agree not to activate the mechanism in cases other than fraud/corruption’, would a majority of governments feel comfortable with triggering it outside these situations in future? If some governments are reluctant to activate it, then they’ll be able to hide behind the declaration. And we can expect many governments would be reluctant to activate it, because they’re afraid that it could be used against them next. That’s clear from how hard it’s been to get a majority of countries together to support Article 7.

Second, the declaration will allow Orban to keep abusing EU funds to help his re-election in 2022

The declaration would do this by saying that the EU’s court of justice (CJEU) needs to rule on the legality of the mechanism before it can be used for the first time. It’s possible that the CJEU could decide on the legality of the mechanism sooner – even if the Council decided to delay referring the question to the court, the Commission or European Parliament could do so without delay. And the CJEU would be free to prioritise an answer. So, there could be an answer before 2022. However, then you have to take into account the time it would take before the mechanism is actually activated (there’s a process involving back and forth discussions and a vote). So, Orban will probably buy himself enough time.

Third, the declaration will buy time for irreversible attacks on democracy

The declaration would do this by strengthening an existing ‘emergency brake’ to delay the mechanism after the Commission triggers it. The attacks on democracy and rule of law in Hungary and Poland are difficult to reverse, unless there’s a change in government (and a government with a supermajority in Hungary’s case). Both governments have successfully strung out legal and political procedures in Brussels while continuing to torch or capture democratic institutions back home. They’ve capitalised on every delay to continue building a system where it will be difficult for them to ever lose power.

There’s no point

The other 25 governments don’t need to accept this declaration to move ahead. As Professor Daniel Keleman has pointed out, they can vote through the conditionality proposal by a majority. Fidesz and PiS can’t actually afford to keep blocking the recovery fund and MFF, so they will drop their veto threat once the conditionality proposal is voted through.