The Commission was at pains to show how its disparaged annual Rule of Law Report is already nudging member states to address democratic deficiencies. The level of criticism aimed at Hungary and Poland suggests it has more direct action in mind.

he European Commission on Tuesday released its second annual report on the state of the rule of law in its 27 member states, in which it cited concerns related to the independence of the judiciary and the situation in the media across the bloc, particularly in Hungary and Poland.

This year’s report – the first edition of which faced criticism over its lack of rankings, recommendations and sanctions – was at pains to stress how the exercise has stimulated much-needed debate and already encouraged positive reforms related to the rule of law in a number of member states. It focuses on four key elements the Commission considers indispensable to maintaining the rule of law: justice systems; the anti-corruption framework; media pluralism and media freedom; and other institutional issues linked to checks and balances.

However, the stinging criticisms of Hungary and Poland, which are the only two member states currently under formal EU investigation into their undermining of the rule of law, indicates much harsher measures are in the pipeline, such as the withholding of billions of euros in EU funds designed to help member states’ economies recover from the coronavirus pandemic.

“The second edition shows that member states can make progress to address rule of law matters. Yet this has been uneven and there are causes for serious concern in a number of member states, especially when it comes to the independence of judiciary. Moreover, two journalists were murdered over the past months – this is not acceptable,” Vera Jourova, vice-president for values and transparency, said.

Didier Reynders, the European commissioner for justice, was more explicit when he told Hungarian news site Eurologus ahead of the release of the 2021 report that while it aims to foster a dialogue among member states, this apparently does not seem to be the case with Hungary and Poland.

This is no longer about prevention but about sanctions.

– Didier Reynders, European commissioner for justice

Reynders said the Commission will not endorse Hungary’s coronavirus recovery plan, which requests 7.2 billion euros in non-returnable grants from the EU’s Recovery and Resilience Fund, until major judiciary reforms are implemented and the government provides adequate guarantees that corruption cases uncovered by the European Anti-Fraud Office (OLAF) will be properly investigated by the national authorities.

“This is no longer about prevention but about sanctions,” Reynders said, adding that the Commission is ready to deploy all measures – including suspending European funds – to protect democracy.

Bad boys
Both Hungary and Poland were cited by the Commission as among those few member states continuing to carry out reforms that lower safeguards for judicial independence, which is raising concerns about the increasing politicisation of the countries’ justice systems.

In Hungary, new developments, like the appointment of the president of the Supreme Court, the Kuria, outside normal procedures and the new appointee lacking any experience in the courtroom, are adding to existing concerns.

The implementation of Hungary’s anti-corruption strategy is ongoing, the report admitted, but risks of clientelism, favouritism and nepotism, and the risks arising from the link between businesses and political actors remain unaddressed.

Media pluralism remains at risk, especially after the Media Council decided to take independent radio station Klubrádió off air. And access to public information was tightened during the COVID-19 pandemic, with significant amounts of state advertising continuing to permit the government to exert indirect political influence over the media.

As regards the system of checks and balances, the transparency and quality of the legislative process remain a source of concern. Pressure remains on civil society organisations critical of the government, and concerns were expressed about newly established private trusts – which now control the majority of universities – receiving significant public funding while being managed by board members close to the government.

In Poland, the Commission reiterated that justice system reforms still being carried out by the nationalist-populist Law and Justice (PiS) are increasing the influence of the executive and legislative powers to the detriment of judicial independence. This is also raising the risk of undue influence on corruption prosecutions for political purposes, which is aggravated by concerns over the independence of the main institutions responsible for the prevention and fight against corruption, in particular the subordination of the Central Anti-Corruption Bureau to the executive and the fact that the justice minister, Zbigniew Ziobro, is also the prosecutor-general.

The rest
The Commission deemed the situations in the other two Visegrad countries and other eastern EU members to be more positive.

Czechia, which just the day before had its 7-billion-euro recovery plan approved by the Commission, was praised for two important reforms of its judiciary: the selection procedure for judges and the disciplinary regime for judges. However, the report highlighted “recently found evidence of conflicts of interest at the top executive level, on the basis of which a case has been accepted by the European Public Prosecutor’s Office” – a direct reference to the EU audits that found Prime Minister Andrej Babis in conflict of interest regarding millions of euros in subsidies to his Agrofert conglomerate.

Slovakia, whose criminal justice system has been roiled by a seemingly never-ending list of scandals and arrests of top judges, prosecutors and police officers, was noted for the continuing “important efforts to improve the independence, integrity, quality and efficiency of the Slovak justice system, already noted in the 2020 Rule of Law Report”.

“These reforms reflect efforts to improve [Slovakia’s] justice system and it is important that their implementation takes into account the relevant European standards to safeguard judicial independence. This is also important considering that the level of perceived independence of the judiciary, although it has improved among companies, remains very low among the general public,” the report said.

In Romania, the Commission highlighted progress in upholding the rule of law and fighting corruption, but stressed the judicial reforms passed by the Social Democratic government that governed from 2017 to 2019 are still undermining the country’s ability to advance in its goal of aligning to EU standards. The report acknowledges the current centrist, pro-European government’s commitment to reversing those reforms, though the special tribunal established by the Social Democratic majority to investigate corrupt magistrates and judges, which has been repeatedly rebuked by the Commission as a tool for political interference, has not yet been dismantled due to disagreements within the tripartite coalition government.

The Commission also urged the Bucharest government to address the “shortages” of judges in the justice system, which “have been accentuated by the recruitment of new magistrates, combined with the retirement of a significant number of magistrates”, and is “adding more pressure on magistrates, with implications for the quality and the efficiency of justice”.

When it comes to media freedom, the report warns of a media sector “prone to political pressure, especially where revenues depend on state advertising”. This was singularly the case “in the context of the COVID-19 pandemic”, when several prominent media outlets received state funds of significant importance for their continued viability.

Online harassment of and threats against journalists are a growing source of concern, and several lawsuits against journalists with intimidating effects have been reported.

– 2021 Rule of Law Report – Country Chapter Slovenia

Slovenia, another country under the spotlight for its democratic backsliding, was criticised in the report over the “deteriorating” situation of media freedom and pluralism. “Online harassment of and threats against journalists are a growing source of concern, and several lawsuits against journalists with intimidating effects have been reported,” it stated. The Commission also cited concerns with the refusal of the authorities to finance the Slovenian Press Agency for 2021.

The civil society space is also challenging, the report stated, citing “smear campaigns against non-governmental organisations, especially on social media”, but also “attacks to the civic organisations’ financial and economic viability, including by reducing funds”.

In Croatia, the report said the level of perceived judicial independence remains lows. “Public procurement procedures remain a high-risk area for corruption, and several cases have been discovered due to reporting by whistleblowers. The prosecution and investigation of high-level corruption continues, but due to protracted proceedings convictions are often delayed,” it said.

When it comes to press freedom in Croatia, the report noted that a legal framework for the protection of journalists is in place, “but journalists remain a target of hate speech and threats, both online and offline” and that Strategic Lawsuits Against Public Participation, or SLAPPs, targeting journalists are continuing. “Examples of such cases include lawsuits against journalists by prominent politicians or public officials,” it said.

For Bulgaria, the Commission highlighted some positive developments in judicial reform over the past year, although challenges remain.

The Commission said that the accountability and criminal liability of the prosecutor general remains an issue after a new law entered into force, though noted the Constitutional Court had since declared it unconstitutional. It also highlighted that concerns related to the composition and functioning of the Supreme Judicial Council remain. Reforms were proposed in a new draft constitution but this was ultimately not adopted. The report noted that the promotion regime within the judiciary also remains problematic, as it is still not driven by a proper merit system and open competition.

When it comes to Bulgaria’s fight against corruption, the report marked some progress and overall consolidation of this effort, noting the approval of the new anti-corruption strategy for the period 2021-2027 as a positive step because of its set of new priorities, such as strengthening capacities to fight corruption, increasing accountability of local authorities, as well as enabling timely responses in cases of corruption.

However, “significant challenges remain concerning the effectiveness of measures related to the integrity of public administration, lobbying and whistleblowing protection, where no dedicated regulation exists. Despite the increased investigative activity and the reinforcement of resources, final convictions for high-profile cases of corruption remains low and a solid track-record of final convictions remains to be established in this respect,” it said.

In the area of media pluralism and freedom, the report pinpointed how a lack of transparency of media ownership remains a source of concern.

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