The leaders of the European Union’s 27 member states have reached a final agreement on the $2 trillion package designed to rebuild the bloc’s faltering economies in the wake of the coronavirus recession.
The package comprises the EU’s €1.1 trillion ($1.3 trillion) Multi-annual Financial Framework, which is paid into by every member state and distributed across the bloc over a seven-year period, and a special Covid recovery fund of €750 billion ($858 billion), for which the EU will centrally raise money on financial markets and hand out as both loans and grants to member states.
The EU reached an agreement on the package back in July, but member states had since struggled to unanimously agree on the conditions attached to receiving funds.
Two member states, Poland and Hungary, had vetoed the agreement at previous meetings of member states in protest at EU demands that funds would be withheld from member states deemed to be in violation of the rule of law. Both countries are currently under investigation for exactly this, with charges ranging from suppression of political opposition to undermining the independence of judges.
However, at a meeting in Brussels, a compromise was found which satisfied the two delinquent states. If enough member states believe that Poland or Hungary, for example, are not meeting the EU’s agreed rules and standards, they can trigger a vote which can be secured by a qualified majority. However, the latest agreement provides the country in question with the option to challenge that decision at the European Court of Justice.
Vera Jourova, vice president of the European Commission, said she was “satisfied that the legal text of the Regulation on Rule of Law conditionality remains untouched and that there is “qualified majority voting in the decision of the Council.”
She also said she believes that “some Member States might want to seek full legal certainty on this important matter before the European Court of Justice. This is their right. I expect the proceeding to go fast. In my view, we are talking about months rather than years.”