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We must make it clear that our problem is not in Mecca but in Brussels. Viktor Orbán

The European Parliament recently voted to initiate the Article 7 procedure against Hungary in the latest and perhaps most dramatic development of a conflict spanning several years. The accusations against Hungary are manifold and in a historic move by the EU, the European Parliament - by a vote of 448 against 197 (with 48 abstentions) - approved the request to check Hungary’s rule of law compliance.

Article 7(1) of the Treaty on European Union (TEU) provides that:

[O]n a reasoned proposal by one third of the Member States, by the European Parliament or by the European Commission, the Council, acting by a majority of four fifths of its members after obtaining the consent of the European Parliament, may determine that there is a clear risk of a serious breach by a Member State of the values referred to in Article 2 [of the TEU]

Following such a determination, in accordance with Article 7(2) of the TEU, the European Council may by unanimity find the ‘existence of a serious and persistent breach by a Member State of the values referred to in Article 2 [of the TEU]'. If this is found to be the case, Article 7(3) of the TEU allows certain Treaty rights of that Member State, including voting rights in the Council, to be suspended.

In its initial stages, then, this process could in theory avert such drastic measures, by allowing a structured dialogue between the Member State and the Union, and ultimately solving the problem(s) before matters progress further.

However, as this article examines, these provisions mask how limited the EU's powers actually are; in reality, it seems that Hungary will likely be allowed to continue on the same path, as a result of the highly political nature of Article 7 of the TEU.

The EU thus finds itself in a potential deadlock, where sanctions are weak and unlikely to address the problem, yet avoiding such sanctions or failing to impose them implies a continued acceptance of the erosion of its founding values.

Hungary’s Transgressions

The Background

The far-right government of Hungary Prime Minister Viktor Orbán has been successively limiting freedoms and judicial independence in order to further a political agenda. In power since its significant victory in 2010, Orbán’s conservative Fidesz party sought to rewrite the country’s constitution with numerous amendments made possible by the ‘supermajority’ it holds in the country’s legislature.

Numerous troubling developments - as documented by Freedom House - have taken place over the past several years, many of which touch on the freedom and independence of the media. Some of the particularly worrisome developments include the fact that the national broadcaster clearly backs the ruling party, and the closure of a lead left-leaning newspaper: both events are widely considered to have significantly and detrimentally affected media diversity in Hungary.

In addition, several news sites were banned from entering and reporting on the Hungarian parliament earlier this year. While this ban was later lifted, it is illustrative of the immediate and seemingly passionate responses made when the country is faced with even remote media resistance. Journalists have increasingly employed self-censorship for fears of lawsuits or fines, and a free daily newspaper was shut down in 2016 and replaced by a ‘government-affiliated free newspaper’, Lokál. Such interference with the media in Hungary risks seriously limiting the diversity of the information spread in the country, and undermines the exercise of truly democratic citizenship by reducing the availability of opposing viewpoints.

Judicial reforms are also worrying; the retirement age of judges was reduced from 70 to 62 to force the mandatory retirement of almost 300 judges. This move was found incompatible with EU equality legislation (more specifically, Directive 2000/78/EC), and as a response, Hungary amended its laws: retirement age was set at 65, to be imposed over 10 years, and judges forced into retirement were to be reinstated in accordance with the new legislation. Such reinstating never took place, however.

These reforms included further affronts to the national judiciary, in the ousting of the Supreme Court chief, the appointment of Tünde Handó - the wife of a prominent Fidesz MEP and family friend of Orbán, as court administrator - and other Orbán allies to the Constitutional Court. Orbán clearly recognises the potential benefit of having close allies in key position throughout the judiciary, and although the expansion of Handó’s powers were criticised heavily and limited somewhat, the executive appears to remain largely in control over judicial development.

The Sargentini Report

Earlier this year, Judith Sargentini, a Dutch Green MEP, drafted a report which ultimately recommended the triggering of Article 7 of the TEU against Hungary. The report brought attention to, amongst other things, judicial independence, corruption, freedom of expression, academic freedom, and rights of minorities and refugees.

Hungarian officials were quick to retort, however: Judit Varga, the Hungarian minister of state for EU relations, calling the report ‘misleading and riddled with factual errors’ and as depicting ‘a shallow, misjudged approach and ignor[ing] the will of the Hungarian electorate.’ Varga further accused the report as being inherently biased against contemporary European conservatism and Christian-democratic values. The merit of these criticisms aside, such a reaction is perhaps to be expected if a country is accused of undertaking undemocratic and ‘un-European’ behaviours. The importance of investigating and discussing such serious accusations, however, cannot be underestimated.

Hungary's Violations of Article 2 of the TEU

It should be noted, firstly, that the amendments introduced by Orbán’s government are in accordance with national law after the legitimate amendments to the constitution. However, the problems arise because they conflict with the foundational values of the EU. Indeed, some argue that it is recognised in the very fabric of the Treaties that individual Member States can and should govern as they see fit – see, for example, Article 3(3) of the TEU – provided such a system falls broadly within the EU’s values.

These values are generally outlined in Article 2 of the TEU, declaring the EU to be founded on the value of respect for, inter alia, freedom, democracy, and the rule of law, and that these are as such common values of the Member States. While written in lofty language, Article 2 of the TEU is meant to embody the spirit of the EU shared between all Member States, the fundamental meaning of which is not up for debate.

The meaning of Article 2 of the TEU thus lies beyond ‘merely’ asserting a theoretical stance on the best way of governing. The EU is a democratic institution which presumes and requires active democratic involvement; primarily at the national level, but also supranationally in the form of European elections or Citizens’ Initiatives. Limits to, for example, media diversity and media freedom, threaten the effectiveness of such a democratic system; the developments in one Member State may thus affect other Member States. This is evident in Orbán’s campaigning for ‘hard-right populists in Slovenia’, and is particularly potent given the presumption that European citizens, as it were, can and do move between Member States under EU law.

Similarly, the European judicial system is underpinned by the national judiciaries, where all Member State courts are also European courts, entrusted with the application of EU law. The undermining of national judiciaries therefore impacts the effective implementation of European law. Developments such as those in Hungary, then, cannot remain entirely separate questions from those of a European nature.

The EU's Rule of Law Powers

In the event that a Member State is found to violate or undermine the values in Article 2 of the TEU, the EU has a limited number of tools in its arsenal. Most importantly for these purposes is Article 7 of the TEU, and the possibility of a total suspension of Council voting rights of the relevant Member State.

It is now up to the Council to determine whether there exists a clear risk of a serious breach of fundamental values, at which point the Council might hear from Hungary as well. This is the most difficult hurdle; under Article 7(2) of the TEU, the Council must decide, unanimously, that there exists a serious and persistent breach of Article 2. Once this has been ascertained, the Council might sanction the Member State by - for example - revoking its voting rights. Kim Scheppele notes that the nature of Article 7 as a whole therefore betrays more than an ultimate suspension of voting rights; a preventive phase, through which the Council merely asserts the existence of a risk, and suggests ways in which to address it.

In a press release, the EU has highlighted that Hungary voluntarily acceded to the EU, and the European Parliament thus can consider that any government therefore has a ‘duty to eliminate the risk of a serious breach of the EU’s values.’ By framing the problem as such, the focus is upon European obligations as opposed to any national constitutional powers, and places such obligations on par with national constitutional ones.

The key problem with Article 7 of the TEU lies in the necessity for unanimity already in determining whether there exists a threat or risk. This implies that without complete unanimity, no such determination may be made, and Article 7 of the TEU falls flat. In such an event, the opportunity for formal discussions is lost, as is the hope of fully addressing shortcomings in the rule of law.

Indeed, it was pointed out by Maia de la Baume and Ryan Heath for Politico that the TEU potentially results in the possibility that the Council makes no determination at all, or even discusses the matter. This illustrates the significantly limited powers of the EU to address potentially sweeping national changes which affect the foundation of the EU, and reinforces the notion of Article 7 of the TEU as being nothing but an empty threat.

Problems Emerge

The inclusion of Article 7 of the TEU indicates at least a basic level of acceptance for its potential necessity. Allowing the proliferation of policies and legislation which is in direct conflict with the spirit of the EU risks undermining the EU’s legitimacy and credibility. The inherent weakness of Article 7 of the TEU may indeed prevent the EU from sanctioning Hungary at all. This is visible primarily in two ways: party-politics, and regional alliances.

Because the process requires unanimity in the Council, no Member State must ‘protect’ the accused if the method is to work. However, Poland has backed Orbán: the Polish foreign ministry declared that all countries have a ‘sovereign right to make internal reforms it deems appropriate’. Such intra-EU alliances imply that Article 7 of the TEU is unlikely to ever be successful, as long as individual Member States value relationships with each other more highly than the coherence of the Union.

Additionally, Orbán’s Fidesz is a member of the European People’s Party (EPP), the largest party in the European Parliament. The EPP has managed to shelter Fidesz for a long time, much to the chagrin of other more liberal Member States, such that even where other political groupings or Member States objected to Hungary’s developments – and similar issues taking place in Poland – little can effectively be done to prevent it.

In the context of Hungary, this may prove especially problematic. Hungary is a member of the Visegrad Group, comprising the Czech Republic, Poland, Slovakia, and Hungary, and was founded in 1991 to reflect these nations’ common interests and roots. Although Slovakia and the Czech Republic have lately aligned more with Germany and Austria than their Visegrad allies, this still demonstrates the potentially closely knit ties between Member States.

Indeed, in this regard, the Czech Prime Minister has also voiced support for Orbán, claiming the procedure under Article 7 of the TEU ‘ushers in negative sentiment into the European Union.’ This may seriously cripple attempts at rule of law protection in the EU, by not adequately representing the great diversity of the EU. It is worth noting that growing desire for smaller, regional partnerships is spreading; prior to this year’s election, the far-right party in Sweden, the Sweden Democrats, campaigned for Sweden to leave the EU, and for a closer Nordic partnership.

Deadlock

This all presents a significant dilemma. The situation in Hungary is quite clearly one which requires response from the EU; indeed, letting such developments pass without comment would be a questionable tactic by an organisation which claims to uphold values of democracy and the rule of law.

However, not only is the EU limited in what it can do practically, but the attitudes towards the powers it does have are mixed. Some argue that Article 7 of the TEU constitutes a punitive measure which seeks to ‘isolate democratically elected governments’, risking inciting nationalist sentiment against Brussels. Nonetheless, Orbán cannot be allowed to go unchecked, and the present situation may test how far the Union can and will go to protect its founding principles.

Article 7 of the TEU is an impossibly political measure for the Union to work with, yet granting it more powers to oversee and punish would seemingly go against the culture of mutual trust which proliferates the EU. The difficulty in using Article 7 of the TEU suggests either that the Union did not foresee such action as being likely, or that there was not sufficient will to allow the Union such powers even if problems did occur. Article 7 of the TEU can only be successful as a true sanctioning procedure, or at least a deterrent, if it were not so inextricably bound to party politics; in its current form, it is about as useful as a chocolate teapot.

Instead, it is argued that the EU should approach such difficulties in a different manner entirely. One suggestion employs EU budget allocations and tying these to Member States’ adherence to the rule of law. This might be particularly effective with a Member State such as Hungary, which may receive up to €25bn until 2020 in European Structural and Investment Funds (ESIF), constituting almost 3% of GDP annually between 2014 and 2018. This is thus a significant contribution to the nation, which, if linked firmly to the upholding of certain basic EU values, may constitute an incentive for all Member State governments to align their general practices with the remainder of the Union.

However, there is a risk with this: Member States which receive less funding thus have less of an incentive to comply, fuelling a cycle of non-compliance. Similarly, it may produce the view that the EU can coerce its members into adhering to its policies by buying support from countries more vulnerable to such tactics. As it stands, however, this may still produce better results than Article 7 of the TEU.

Conclusion

Article 2 of the TEU clearly encompasses potentially vague concepts which will naturally have different interpretations in different countries and cultures. Such differences are part of what strengthens the Union and allows for significant diversity within its borders. However, when national developments risk damaging the EU as a whole, and possibly individual Member States as well, the EU must have a way of dealing with such conflict.

Article 7 of the TEU may have been useful in providing structured dialogue between a Member State and the EU, but its political nature prevents it from functioning properly. This should be addressed imminently in order to preserve the integrity and credibility of the EU as an organisation.

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