Brussels approves Poland’s 35 billion euro recovery plan despite lingering rule of law concerns

BRUSSELS – The European Commission has given its approval to Poland’s recovery plan, a key step for the country to release 23.9 billion euros in grants and 11.5 billion euros in low-interest loans.

The announcement represents a truce in a long stalemate between Brussels and Warsaw over controversial judicial reforms, which stalled the plan for more than a year and raised fears of a legal “Polexit”.

In order to break the deadlock and comply with the Commission’s demands, Warsaw agreed to partially modify the reforms, in particular by replacing the disciplinary regime for judges, deemed illegal by the European Court of Justice, by a new “Chamber of professional judges Liability.”

The revision was introduced by President Andrzej Duda earlier this year and passed by the Sejm, the lower house of Poland’s parliament, in late May. “We don’t need this dispute,” Duda said, adding that the disciplinary regime was operating in an “absolutely irregular” manner.

But critics say the adjustments are cosmetic and fall short of EU standards.

“The new disciplinary body as proposed in the bill does not respect the decisions of European courts and will not prevent the Polish executive from exercising control over judges, thus further compromising their independence,” said Iustitia, the largest association of judges. in Poland, said in a written address to the Commission and the European Parliament.

For now, Brussels seems happy with Polish commitments and has decided to approve the 35.4 billion euro plan, based on the expectation that the government will carry out the reforms.

“The plan contains several measures to improve the country’s investment climate, including a comprehensive reform of the judicial system aimed at strengthening the independence of judges,” European Commission President Ursula von der Leyen said in a statement. communicated.

Von der Leyen will travel to Warsaw on Thursday to personally deliver the executive’s approval. The EU Council will then have four weeks to give the final blessing.

After that, Poland will start receiving periodic installments of grants and loans, but only after a series of legal steps have been taken, including the settlement of disciplinary cases in a separate and impartial tribunal.

“The approval of this plan is linked to clear commitments from Poland on the independence of the judiciary,” von der Leyen noted.

During internal deliberations, two Commission vice-presidents, Frans Timmermans and Margrethe Vestager, voted against approval, while three others who were not physically present raised their concerns in writing, Euronews told Euronews. an EU official familiar with the discussions.

The legal dispute between Brussels and Warsaw dates back to December 2019, when the Sejm passed a bill empowering the Supreme Court’s Disciplinary Chamber to punish magistrates suspected of engaging in “political activity”. Potential penalties included fines, pay cuts and outright suspension.

The chamber was immediately condemned by opposition parties, associations of magistrates, the European Commission and the United Nations, who saw in the reform a dangerous encroachment by the executive on the judicial power of the state and, by therefore a threat to the separation of powers.

Changes to the way judges are appointed have also been criticized for giving more influence to politicians, to the detriment of professional judges. Warsaw retaliated, arguing that the bill was necessary to eliminate remnants of communist rule, fight corruption and improve efficiency.

The European Court of Justice (ECJ) concluded that the chamber was not compatible with EU law because, among other factors, it “does not offer full guarantees of impartiality and independence and , in particular, is not protected from the direct or indirect influence of the Polish legislative and executive power.

The ECJ subsequently ruled that the system should be dismantled and the judges’ suspension lifted. The Commission has repeatedly asked Poland to comply with the CJEU’s judgments, a request which has gone unanswered and which has resulted in a daily fine of one million euros.

In an attempt to force Warsaw’s hand, Brussels withheld its approval of the €35.4 billion recovery plan, first presented in May 2021, and put three conditions on the table to release the money: dismantle the disciplinary chamber, reform the regime and restore the suspended magistrates.

The amendments championed by President Duda seem to have allayed the Commission’s most pressing concerns, despite the reservations of legal experts and MEPs.

The creation of a new “Chamber of Professional Responsibility” to oversee judges does not mean the automatic reinstatement of judges suspended by the disciplinary regime, said Jakub Jaraczewski, a lawyer at the Berlin think tank Democracy Reporting International.

“I fear that the Commission is falling into the trap of a feint from Warsaw,” he told Euronews. “A minor reform presented as a real solution to the rule of law crisis in Poland and accepted by the Commission in other to mark a win-win situation.”

The Polish government did not respond to a request for comment.

The European Parliament’s Committee on Civil Liberties and Justice also expressed doubts and invited President von der Leyen for an “urgent exchange of views” on the Polish recovery plan and the situation of the rule of law in the country.

“It’s a fake reform,” Daniel Freund, a German MEP who sits with the Greens, told Euronews. “We have no idea where the EU money is going and if there is a dispute or if there is fraud or mismanagement, there is no longer an independent tribunal that you can go to. address in Poland.”

Wednesday’s announcement brings much-needed economic relief to Warsaw. Soaring energy prices and record inflation have made receiving stimulus funds imperative for the ruling right-wing Law and Justice (PiS) party.

The continuing standoff has left Poland one of the few member states without an approved plan, along with Hungary, which remains stuck over a rule of law dispute, and the Netherlands, which has no not yet submitted their program.

The fund is being revamped to deal with the effects of war in Ukraine and support an ambitious roadmap to make the bloc fully independent of Russian fossil fuels.

Momentum around the Commission’s green light has grown in recent weeks as Poland has taken a leading role in the EU’s response to the invasion of Ukraine.

The Polish government has advocated for tough sanctions against the Kremlin and military support for kyiv, while simultaneously opening the doors to millions of refugees fleeing the war-torn country.

Poland’s hard line has caused a schism with Hungary, a close ally also under heavy scrutiny. Budapest has championed a more moderate, and often divisive, course of action, going so far as to water down a sweeping ban on Russian oil to exempt pipeline supplies.

The Commission’s decision coincides with negotiations around an EU directive that would introduce a minimum effective tax rate of 15% for large multinationals. The directive aims to transpose a revolutionary tax agreement concluded last year by the international community.

But Poland used its veto power to block the legislative proposal, becoming the only EU country in opposition. Tax issues require the unanimity of the 27 Member States.

Warsaw says it wants the other pillar of the global deal – the physical reallocation of taxing rights – to be included in the same directive, but work on that element is more complex and has yet to be finalized.

There are growing suspicions in Brussels that Poland is using its veto power over the tax deal to force approval of the stalled stimulus package.

The approval of the recovery plan should facilitate tax discussions, a top priority for the French Presidency of the Council of the EU.

“Poland should respond to EU blackmail with a veto on all issues that require unanimity,” Polish Justice Minister Zbigniew Ziobro said in December as he discussed the withholding of funds . —Euronews