28 März 2023

A lot to tell already but still a long way to go: The EU’s rule of law crisis in a nutshell

By László Detre
Buildings of the European Court of Justice
“In the defense of the rule of law, the Court of Justice of the EU is generally seen as the ‘last soldier standing’. But it can’t change the world on its own.”

Article 2 of the Treaty on European Union (TEU) enshrines the principle of the rule of law as one of the founding values of the European Union that is – or should be – common to its member states. The theoretical debate on the rule of law has been ongoing for a while. Still, in Europe – although some politicians question this – there is a consensus on its core elements and meaning even if their detailed content may vary from member state to member state.

This is not surprising, as it is based on a fundamental premise: constraining all public powers by way of law. Together with democracy and the protection of fundamental rights, the rule of law constitutes the essence of liberal democracy, guaranteeing the true enjoyment of individual freedoms. Its requirements include the quality of laws, the separation of powers and the independence of the judiciary, which is responsible for guaranteeing all of these.

A matter for the entire EU

In the EU, the rule of law is a prerequisite for its legal and institutional system: it touches upon its identity and ensures its daily business built on mutual trust. As such, safeguarding the rule of law within the EU is a matter of all stakeholders, and there are several reasons to consider rule of law issues arising in one member state as an issue for the entire EU.

As the decline of the rule of law in some member states has been ongoing for some time and has significantly shaped the political discourse and some core legal developments at the EU level, it may well determine the future of integration too. This article entangles what has been done to tackle the situation, with a glimpse into the possible next steps.

What is to tell already?

To begin with, there has been a tremendous amount of academic research, political discussion and public debate on the rule of law in Europe, and the wider literature seems endless. Usually, the discussion around the rule of law has two intertwined levels.

At the first level, it is used in a broader, general sense, referring to a state of affairs that might be equated with the spirit, instruments and institutions of a liberal democracy. Second, at the legal, doctrinal level, more specific issues are tackled. While the latter is – at least in liberal democracies – subsumed within the former, the foundational idea shall run through all exchanges on the subject matter. Within the EU, both levels of argument can be observed.

There is no end in sight for the current crisis of the rule of law in the EU, which has been caused mainly by two member states, namely Hungary and Poland. At the more general level, the notion of liberal democracy has been openly challenged by the rise of illiberalism. At the concrete, legal level, the doctrinally evaluated rule of law sub-principles have been systematically breached, especially the independence of the judiciary. This, in turn, is undoubtedly a matter of European concern, since national courts also serve as EU courts and are primarily responsible for consistently interpreting and enforcing EU law.

Enforcing the rule of law under Article 2 TEU

Legally speaking, the main focus of rule of law arguments in the EU is the aforementioned Article 2 TEU. For a while, some even questioned whether Article 2 could be considered a law at all. Secondly, also for a long time and even within the EU itself, it has been argued that the EU could not deal with issues related to Article 2 TEU in any way other than through the procedure of Article 7 TEU. Today, questions around Article 2 TEU are decisive for the EU. Its scope – unlike other provisions of the Treaties – is not limited, and as such all national measures must comply with it. The major question in EU law is the how.

Since all EU action is framed by the principles of conferred powers, subsidiarity and proportionality, the EU has to justify itself under very strict scrutiny to avoid allegations of acting outside its competence. Still, the EU’s rule of law toolbox – both with regard to responses by the political organs and by the Court of Justice (CJEU) – has greatly expanded over the last decade. Given the limits of this article, I will not present all its elements here, but give a short overview only.

Political tools to protect the rule of law

The political tools tend to be evaluative, such as the annual rule of law reports and/or dialogue-based, such as the Rule of Law Framework. These are rather powerless, but the EU also has some instruments that allow to put political pressure on a member state. Of these, two examples shall be presented here.

First, there are the aforementioned Article 7 procedures, which were originally meant to be used in situations like the rule of law crisis. They allow the EU, or more precisely the Council, to name and shame the concerned member state if there is a clear risk of a serious breach of the values set out in Article 2 (the so-called Art. 7 (1) procedure), and to suspend its rights under the Treaties if the European Council determines that there is a serious and persistent breach (Art. 7 (2) procedure). In theory, these procedures would allow the EU to take far-reaching measures. In practice, so far, only the one with the rhetorical consequences has been initiated years ago against Poland and Hungary, but nothing substantial has happened.

Conditionality: EU funding as leverage for the rule of law

Second, there are some relatively new tools: the so-called conditionality mechanism and the conditionality technique itself, which have been incorporated into EU legislation governing the distribution of major EU funds. According to the conditionality mechanism, in case of violations of the rule of law principles that directly threaten the EU budget, the EU can suspend any funds or deny any new commitments from its budget to the concerned member state (which, in the first case, is then obliged to substitute the EU resources from its own budget in order to protect the interests of the final beneficiaries). The conditionality mechanism is mainly anti-corruption focused and obliges member states, inter alia, to ensure the proper functioning of public procurement or financial control authorities. However, reforms of the judiciary may be required, too.

In other cases, in order to get access to EU assets, the member states have to comply with so-called milestones or horizontal and thematic enabling conditions. In the case of Hungary, for example, meaningful rule of law reforms, especially in the judiciary, have been required to obtain access to the COVID-19 recovery funds.

In an even more far-reaching way, the Common Provisions Regulation, which covers several specific EU instruments such as the Cohesion Fund, requires that funded projects comply with the EU’s Charter of Fundamental Rights. This allowed to challenge the anti-LGBTQI law in Hungary. While there are concerns in the literature about the use of this conditionality technique, it could be a way to obtain meaningful results in spite of the EU’s lack of power to enforce its values in a more direct way.

The judicial way to protect the rule of law

In recent years, proceedings in front of the CJEU have started to play the main role as means to safeguard the rule of law in the EU. There are two ways of bringing a case to the CJEU. First, the Commission or another member state can claim that the concerned member state is not complying with its obligations under EU law. Second, national courts have the right, or even the obligation, to refer questions to the CJEU for an authentic interpretation of EU law. If the national law is not in line with EU law, even if it is the constitution or a decision of the national constitutional court, the referring court must not apply that piece of national law.

While the EU’s political actors are sometimes criticised for not doing enough to protect and restore the rule of law, the CJEU is generally seen as the ‘last soldier standing’. In 2018, it delivered a highly significant judgement in which it held that a specific provision of the TEU, namely the obligation for member states to establish a judicial system providing effective remedies in the fields covered by EU law, is a concrete expression of Article 2 TEU, more precisely, the rule of law.

This created a bridge for the application of Article 2 TEU, which has been described in the literature as ‘mutual amplification’: while the specific provision in the Treaties defines the substance of the obligation, Article 2 justifies its scope of application.

This judgement was indeed a huge step in the history of judicial enforcement of the rule of law, and it opened the way to several subsequent rulings, in particular with regard to the judicial system in Poland. In 2022, the CJEU adopted two more judgements in which it essentially embraced the concept of ‘mutual amplification’. Very importantly, it added that secondary EU law could be adopted to enforce Article 2 TEU values, such as the rule of law, if a legal basis was provided.

On top of this, the Commission has initiated an infringement procedure against Hungary regarding the aforementioned anti-LGBTQI law, citing the violation of Article 2 TEU on its own. With this, the Commission followed up on a long discussion in academia. If the CJEU accepts this interpretation, it can be a game changer, as it would mean that Article 2 TEU can be invoked against any national measure, without the need for further EU law to be involved.

What next?

The EU has often been criticized for not doing enough to protect the rule of law. Here, one may consider that the EU is not a full-fledged federation and its institutional structure has its limits. Moreover, the EU institutions have different interests to reconcile: the Council representing the member states, the Commission the EU, the European Parliament the peoples.

From a political or sociological perspective, it is fair to say that constitutionalisation – the absolute respect of common values such as the rule of law by all stakeholders – has not reached a level where it overrides all other concerns.

The CJEU cannot change the world on its own

As for the legal part of the picture, two observations can be made. First, the current treaties already provide the EU institutions with quite substantive powers to tackle the rule of law crisis. An institutional reform could help to overcome existing problems, but is definitely not the only solution.

Second, due to the lack of activity of the EU’s political bodies, the CJEU has become the driving force in the field of rule of law protection. However, on its own, it cannot – entirely – change the world. The case-law of the CJEU could lead to a point where Article 2 TEU would be considered as a self-standing provision and a member state could be sued for any national measures that violate the EU rule of law. In essence, this would turn the CJEU into a federal constitutional court.

There are arguments claiming that even if this happens, it should only be used in exceptional cases, for example when the essence of the fundamental rights is breached. While this sounds acceptable and workable in practice, there are no legal guarantees in the treaties that this would be the way to go. Having said that, the CJEU works on the basis of petitions and as such, as a safeguard for the member states, a careful assessment should be made by the stakeholders (the Commission and other member states) before such procedures are initiated.

A choice of three paths

In conclusion, there are three plus one paths that the EU might take from here with regard to the rule of law.

  • In the first scenario, the European nations convince their leaders to take a firmer stance on the rule of law in the European institutions and to fully use the EU’s means to support the CJEU within the current legal framework.
  • In the second, less likely scenario, there are going to be treaty changes, supported by all the European peoples, leading probably to a more federal EU, possibly with different tracks (the multi-speed idea).
  • Thirdly, if the European nations cannot agree on a common direction, or the mindsets of the political actors do not change, it may be necessary to adjust expectations of the EU accordingly. In this case, the rule of law crisis may endure.

The plus one option lies within the concerned member states themselves. Their citizens could demand that national authorities comply with the EU rule of law standards to which they have freely and voluntarily joined.

László Detre is a legal officer at the Hungarian Helsinki Committee and academic advisor of the re:constitution programme at Forum Transregionale Studien (Berlin).

This contribution is part of the thematic forum “Supranational governance between diplomacy and democracy – current debates on EU reform”, published in cooperation with the online magazine Regierungsforschung.de.

Pictures: European Court of Justice: Luxofluxo [CC BY-SA 4.0], via Wikimedia Commons; Portrait László Detre: Joanna Scheffel [all rights reserved]; EU flag: Arno Mikkor (EU2017EE) [CC BY 2.0], via Flickr.

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