EU CHAOS: Poland and Hungary threaten to crash bloc’s £677billion COVID recovery fund

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The two rule-breakers are concerned EU member states and the European Parliament are seeking strong conditions that prevent nations who violate the rule of law from accessing the recovery fund. Warsaw and Budapest often clash with the European Commission over accusations of the capitals breaking the bloc’s rules. As the holder of the EU’s rotating presidency, German Chancellor Angela Merkel is set to lead negotiations on finding a compromise.

The €750 billion recovery fund for pandemic-stricken regions and industries and the bloc’s €1.1 trillion budget for the next seven years was agreed by EU leaders at a summit in July.

But European governments are still required to broker an agreement on the creation of new bloc-wide taxes to help repay the grants and loans issued under the coronavirus fund.

Poland and Hungary are expected to demand softer rule of law protections when the talks reopen.

Hungarian prime minister Viktor Orban already celebrated a victory at this summer’s summit when he claimed the agreement had been softened enough to give him a very over any proposed rules.

EU diplomats have now claimed Poland had issued a threat to hold up the negotiations when it is approved by the European Council.

However, a senior Polish diplomat hit back, claiming Warsaw’s position had been misinterpreted.

The diplomat said: “Saying that we would block something is an overstatement.

“We can’t block something that we haven’t seen yet.

“We’re waiting for legal acts that would describe the political agreement to comment on it.”

European Commission President Ursula von der Leyen used her recent “State of the Union” speech to insist on the highest protections for the rule of law across the bloc.

She said: “The Commission attaches the highest importance to the rule of law.

“This is why we will ensure that money from our budget and NextGenerationEU is protected against any kind of fraud, corruption and conflict of interest. This is non-negotiable.”

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The German added: “But the last months have also reminded us how fragile it can be.

“We have a duty to always be vigilant to care and nurture for rule of law. Breaches of the rule of law cannot be tolerated.

“I will continue to defend it and the integrity of our European institutions. Be it about the primacy of European law, the freedom of the press, the independence of the judiciary or the sale of golden passports – European values are not for sale.”

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Mrs von der Leyen said the European Parliament and the German presidency must now work together to reach an agreement.

She said: “The German presidency is putting forward a proposal, how to proceed now on this matter, with Parliament.

“So I know that my position is very clear. I have put forward a proposal. But now it is up to the Parliament and the Council to negotiate a common landing zone.”

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