International 08/02/2022

Brussels starts withholding EU funds from Poland for ignoring the CJEU

This is the first time that the Commission has gone to this length with an EU member state

2 min
European Commission President Urusula Von der Leyen and Polish Prime Minister Mateusz Morawiecki at the plenary session of the European Parliament in Strasbourg October 19, 2021. (Horizontal)

BrusselsThe European Commission wants to show Poland that it can no longer ignore the legal foundations of the European Union. On Tuesday, the EU executive activated for the first time the mechanism that allows it to withhold EU funds from a member state for failure to pay a penalty. Specifically, Brussels will withhold for now €14.5m of funds earmarked for Poland after the country refused to close the Turów lignite mine as demanded by the European authorities.

The case stems from a dispute between the Czech Republic and Poland, because the Turów mine is located very close to the border between the two countries and the Czech Republic complained that it could damage its aquifers and jeopardise the safety of certain areas. Prague took the case to the Court of Justice of the European Union (CJEU), which ruled in favor of the Czech Republic and ordered the precautionary closure of the mine. Warsaw, however, ignored it, and so the CJEU set a fine of half a million euros per day until the judgment was complied with. After several requests for payment of the penalty, Brussels has activated the way to collect the money by force through the European budget.

The case, however, goes beyond the mine, because it is part of a challenge to the rule of law and the primacy of the European legal framework that Warsaw has been maintaining with Brussels for years. Poland has already received a formal letter demanding €69m from the other record sanction it received from the CJEU for failing to comply with a ruling that forced it to backtrack on a judicial reform that undermined the independence of the country's judges. With Tuesday's unprecedented measure, the European Commission is sending a warning message to the country led by the ultra-conservative Law and Justice party (PiS).

In fact, this is not the only money at stake. In parallel, Brussels has also failed to approve the €36bn Polish recovery plan precisely because of shortcomings in judicial independence. And beyond that, the EU provided itself with a mechanism that allows it to freeze European funds in cases of non-compliance with the rule of law, but has not yet activated it against Poland or Hungary because the case is pending an appeal before the European judiciary.

The withholding of the money does not start this week, but in ten days' time. However, Poland does not seem to have any intention of giving in. A government spokesman in Warsaw told a Polish news agency that the country "will use all legal measures against the Commission's plans to prevent it" and criticised the CJEU's decisions, which it claims have no legal basis. At the same time, however, the Polish government has made several gestures to defuse the open conflict with Brussels. On the one hand, it reached an agreement with the Czech Republic on the Turów mine dispute and, on the other hand, it announced a judicial reform in line with European demands

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