Commission opens new and infringement procedures, advances existing ones against Hungary

Referral to the Court of Justice

• Free movement of goods: Commission decides to refer Hungary to the Court regarding export restrictions in the construction sector

The European Commission has decided on Thursday to refer Hungary to the Court of Justice of the European Union regarding a prior notification scheme introduced by the Hungarian authorities which allows to block the export of building materials. Hit the link below and read more about this.

Reasoned opinions

• Construction products: Commission asks Hungary to comply with EU rules on freedom of establishment
• Combating racism and xenophobia: Commission sends letters of formal notice to Estonia, Poland and Finland and urges Greece and Hungary to correctly transpose EU law criminalising hate speech and hate crimes
• Commission calls on 17 Member States to comply with EU Posting of Workers Enforcement Directive

Letters of formal notice

• Commission calls on 14 Member States to reduce emissions of several air pollutants
• Commission asks Hungary to remove export restrictions related to energy products
• Commission calls on Croatia, Hungary and Romania to submit reports on their 2020 renewable and energy efficiency national targets
• Basic Safety Standards: Commission calls on Hungary to correctly transpose EU radiation protection legislation
• Platform-to-business online trading practices:  The Commission calls on Czechia, Lithuania, Hungary, The Netherlands, Poland, Portugal, Slovenia and Slovakia to respect EU rules on promoting fairness and transparency for business users

Compliance with the freedom of establishment (construction sector)

The Commission has decided today to send a reasoned opinion to Hungary requesting the Hungarian authorities to bring in compliance with EU law national rules affecting the construction sector.

According to the Commission, the Hungarian measures fixing prices for specific raw materials for the construction industry, which impose a 90% penalty on the difference between fixed prices and sale prices, do not comply with the freedom of establishment.

The Hungarian rules also require economic operators to maintain certain output levels, even if economically not sustainable.

The Commission considers that the penalty as well as the combined impact of both measures adversely impact economic operators in accessing and exercising activities in this sector.

In addition, Hungary has failed to notify the measures in violation of the Single Market Transparency Directive. Hungary now has two months to take the necessary measures to comply with the reasoned opinion. Otherwise, the Commission may decide to refer Hungary to the Court of Justice of the European Union.

Combating racism and xenophobia

The Commission has also decided to send a reasoned opinion to Greece and Hungary for failing to fulfil their obligations to transpose the Framework Decision. On 9 June 2021, the Commission sent a letter of formal notice to Greece, asking for an appropriate level of criminalisation of hate speech.  

The Commission also sent a letter of formal notice to Hungary on 2 December 2021, calling it to criminalise public condoning, denial or gross trivialisation of international crimes and to ensure the required level of criminalisation of racist and xenophobic hate crimes in general.

Greece and Hungary's replies did not sufficiently address the Commission's concerns. Therefore, the Commission has decided to send Greece and Hungary reasoned opinions. Greece and Hungary now have two months to reply to the Commission's reasoned opinions. If the replies are not satisfactory, the Commission may decide to bring this matter before the Court of Justice of the European Union.

Posting of workers

The Commission decided to send reasoned opinions to 17 Member States, including Hungary for failing to bring various national provisions in line with the Enforcement Directive on Posting of Workers.

The Enforcement Directive aims to strengthen the practical application of the rules on posting of workers by addressing issues related to fighting fraud and circumvention of rules, access to information, and administrative cooperation between EU Member States.

The Member States concerned now have two months to take the necessary measures, otherwise the Commission may decide to refer the cases to the Court of Justice of the European Union.

Reduction of emissions of air pollutants

The Commission is calling on 14 Member States, including Hungary, to respect their reduction commitments for several air pollutants as required on the reduction of national emissions of certain atmospheric pollutants (the ‘National Emission Ceilings' or ‘NEC Directive').

The NEC Directive sets national emission reduction commitments for several pollutants to be attained by each Member State each year between 2020 and 2029, and more ambitious reductions for 2030 onwards. Member States are required to establish national air pollution control programmes (NAPCPs) to show how these reduction commitments will be met. 

The Commission is therefore sending letters of formal notice to these 14 Member States, which now have two months to respond and address the shortcomings raised by the Commission. In the absence of a satisfactory response, the Commission may decide to issue a reasoned opinion.

Removing export restrictions related to energy products

Today, the Commission has decided to open an infringement procedure against Hungary, requesting the Member State to comply with EU law when it comes to national rules affecting the energy sector.

The Hungarian measures introduce prior notification schemes, which allow blocking the export of wood-based and coal-based energy carriers.

The Commission considers the measures to have an equivalent effect to quantitative restrictions on exports within the internal market,

in violation of Article 35 of the Treaty on the Functioning of the European Union (TFEU).

It appears that Hungary has further breached the standstill period under the Single Market Transparency Directive, by adopting those measures during this period of time.

In addition, the restriction, which also applies to exports from Hungary to third countries, affects trade with third countries. Hungary now has two months to reply to the arguments put forward by the Commission. Otherwise, the Commission may decide to send a reasoned opinion to Hungary.

Correctly transposing EU radiation protection legislation

The Commission decided today to send a letter of formal notice to Hungary requesting the correct transposition of the revised Basic Safety Standards Directive into national legislation.

The Commission considers that Hungary has still not complied with certain requirements of the law. It also considers that Slovakia has still not fully transposed all the requirements of the Directive, following its letter of formal notice to the Member States in October 2020.

The Directive modernises and consolidates EU radiation protection legislation, and lays down basic safety standards to protect members of the public, workers and patients against the dangers arising from exposure to ionising radiation. It also includes emergency preparedness and response provisions that were strengthened following the Fukushima nuclear accident.

Hungary now has two months to reply and address the shortcomings identified by the Commission. Otherwise, the Commission may decide to send a reasoned opinion.

Stages of an infringement procedure

If the EU country concerned fails to communicate measures that fully transpose the provisions of directives, or doesn’t rectify the suspected violation of EU law, the Commission may launch a formal infringement procedure. The procedure follows a number of steps laid out in the EU treaties, each ending with a formal decision:

1. The Commission sends a letter of formal notice requesting further information to the country concerned, which must send a detailed reply within a specified period, usually 2 months.

2. If the Commission concludes that the country is failing to fulfil its obligations under EU law, it may send a reasoned opinion: a formal request to comply with EU law. It explains why the Commission considers that the country is breaching EU law. It also requests that the country inform the Commission of the measures taken, within a specified period, usually 2 months.

3. If the country still doesn't comply, the Commission may decide to refer the matter to the Court of Justice. Most cases are settled before being referred to the court.

4. If an EU country fails to communicate measures that implement the provisions of a directive in time, the Commission may ask the court to impose penalties.

5. If the court finds that a country has breached EU law, the national authorities must take action to comply with the Court judgment.

Cover photo: Getty Images.