German Chancellor Angela Merkel talks to Hungarian Prime Minister Viktor Orbán and Poland's Prime Minister Mateusz Morawiecki in Brussels | Stephanie Lecocq/AFP via Getty Images European Parliament backs plan to link EU funds to rule of law Vote breakdown highlights east-west split.

The European Parliament Thursday broadly backed the European Commission’s proposal to cut funds to EU countries that do not uphold the rule of law, setting the stage for a battle among member governments and underscoring geographic divisions within the bloc.

The Parliament voted 397 in favor and 158 against a report on the proposal, with 69 MEPs abstaining. The Commission's plan has been widely seen as a way to exert pressure on countries such as Hungary and Poland, which have been accused by EU institutions of failing to adhere to the bloc's core values.

“The notable thing about the mood in the plenary is the division between those member states where the state of the rule of law has already been questioned, and the rest,” the Parliament’s co-rapporteur for the report, Petri Sarvamaa, told POLITICO following the vote.

Sarvamaa, a Finnish member of the European People’s Party (EPP), said that “it’s crucial to understand that this regulation would treat all member states equally.”

Parliament's report called for the chamber to play a greater role in the sanctioning process, but left the majority of the Commission's proposal intact.

Formally, the EPP supports the proposal, but its MEPs are split.

In a debate Wednesday, Euroskeptic MEPs accused the Commission of creating the proposal for the purpose of intervening in domestic politics.

“This proposal goes against the rule of law,” said Tamás Deutsch, an MEP from Hungary’s ruling Fidesz party, which is part of the EPP.

MEPs from across the political spectrum raised concerns that if the new mechanism is used to slash funding to member states, it would be difficult for the EU to ensure that end beneficiaries like students and researchers are not harmed.

Formally, the EPP supports the proposal. But its MEPs were split, with 139 voting in favor of the proposal, 24 against, 15 abstaining, and 40 not voting at all.

The EPP members voting against the proposal were MEPs from Hungary’s Fidesz, as well as Hungarian-speaking MEPs from Romania. Several EPP MEPs from Croatia, Slovenia and Slovakia also voted against.

A member of France's Les Républicains, Brice Hortefeux, was the sole MEP from a Western European mainstream party to vote against the proposal.

Manfred Weber, the leader of the EPP group in the European Parliament and the party's candidate to be the next president of the European Commission, did not cast a vote.

Within the center-left Socialists and Democrats group (S&D), there was a similar East-West divide.

A total of 18 S&D members voted against the proposal. Ten of them were Romanian MEPs from the ruling Social Democrats, two were Slovaks from the ruling Smer party, three were from the Bulgarian Socialist Party, and three were members of the Czech Social Democratic Party.

In the Alliance of Liberals and Democrats for Europe (ALDE), only two MEPs voted against the proposal — one from Romania and one from Estonia.

“It’s not a question of sanctions per se, it’s a question of the protection of European money” — Budget Commissioner Günther Oettinger

MEPs from Euroskeptic groups, including British MEPs like Nigel Farage, overwhelmingly voted against the proposal.

The big battle over the measure will take place among member governments in the Council of the EU, with Warsaw, Budapest and other capitals having already signaled reservations or outright opposition.

Among the proposal’s main proponents are the governments of France, Finland and the Netherlands, as well as influential members of the European Commission.

“We should have had such an instrument earlier,” European Commissioner for Budget Günther Oettinger told MEPs ahead of the vote.

In a nod to concerns from the Legal Service of the Council and some member governments that the proposal improperly replicates the bloc’s Article 7 rule-of-law sanctioning mechanism, the commissioner argued that “the current definition of the scope of the proposal provides for a proper balance between the [budget] and other aspects of the Union mechanisms, for example, Article 7 of our Treaty.”

“It’s not a question of sanctions per se, it’s a question of the protection of European money,” Oettinger added.

“If there is a financial penalty, it must be proportionate to the gravity of the offense or the breach of the principles of the rule of law,” he said.

This article is part of POLITICO’s coverage of the EU budget, tracking the development of the seven-year multi-annual financial framework. For a complimentary trial, email pro@politico.eu mentioning Budget.