EU Infringement Proceedings Against Hungary

On January 17, the European Commission launched accelerated infringement proceedings against Hungary over the independence of its central bank, the replacement of the Parliamentary Commissioner for Data Protection as well as over measures affecting the judiciary. The Commission first raised its objections to the laws before they were put to vote in the Hungarian parliament, but the Hungarian parliament passed them into law anyway. Hungary’s prime minister Orbán now promises to revise the laws so that they no longer violate EU law. His decision to announce this may have been helped by the fact that he must do so in order to start negotiations with the IMF about a loan. Of course it’s not like he has never reversed himself on his promises before.

Viktor Orbán in the European Parliament on January 18, 2012. Photo by MTI.

On the following day, Orbán’s political allies in the EPP hurried to his defense during a visit he paid to the European Parliament, and were quick to emphasize Viktor Orbán’s services to Hungarian democracy. Mr. Orbán himself explained the attacks on his government as if they stemmed from mere misunderstandings. Right around the time that this debate got under way in Strasbourg, the Hungarian press reported that Mr. Orbán’s government banned what promised to be the biggest anti-demonstration to day by the government’s critics.

While Mr. Orbán was busy repairing Hungary’s reputation in the European Parliament, One Million for the Freedom of Press in Hungary – which had mobilized tens of thousands to protest against the government on two previous occasions on 2011 – found out that their protest permit for a third demonstration had been denied by the authorities. The reason: the Hungarian Ministry of Public Administration and Justice had already secured permissions for their proposed date. The government reserved ten locations for March 15, a national holiday – including the usual location of the opposition’s protest – while five other locations suitable for mass gatherings were reserved by the City of Budapest. The government’s permits were issued for the entire week of March 15, preventing the opposition to hold a demonstration any time or anywhere on March 15 or in the inner districts of Budapest. The request of the Ministry of Public Affairs and Justice also stipulated that their permit should also entitle them to these locations in 2013 and 2014 as well.

It is too bad that Mr. Orbán did not bother to include this matter in his speech on the many new arrangements in his home country that are fully in compliance with European values. In the meantime, apologists in the European Parliament made light of the fact that the European Commission initiated infringement procedures against Hungary by citing such seemingly uninteresting issues as  (1) the independence of Hungary’s central bank, (2) the retirement of Hungarian judges and (3) the independence of the office of the ombudsman. The list was repeated like a mantra by those who wanted to ridicule the pettiness of the technicality of these supposedly minor offenses. But these three problems are not mere “technicalities”: they are complex issues which, when not taken out of context, prove that Orbán’s assurances of their correction may have been uttered in a cynical and sarcastic vein, but definitely not as an honest promise. 

I merely compiled some of the most basic information well-known to the Hungarian public in conjunction to these issues. The information is divided into three sections: an explanation of what is objectionable to the European Commission about the Hungarian laws, why the laws are controversial in Hungarian politics, and why they constitute a threat to democracy in Hungary.

********************************************************************************

THE INDEPENDENCE OF THE CENTRAL BANK:

Why the European Commission objected to Hungarian laws: The infringement process is against the central bank law as well as against passages of the new Hungarian constitution. The following is taken from the European Commission’s description of why these laws are a concern:

“Under the MNB (Magyar Nemzeti Bank – Hungarian Central Bank) law, the Minister can participate directly in the meetings of the Monetary Council, offering to the government the possibility to influence the MNB from the inside. Similarly, the agenda of MNB meetings needs to be sent to the government in advance, thus impeding its capacity to hold confidential discussions. Also, changes in the remuneration scheme for the Governor are made again immediately applicable to the incumbent, while they should apply only as of a new term to avoid using salaries to put pressure on the MNB. Finally, the Governor and the members of the Monetary Council have to take an oath (of fidelity to the country and its interests) whose text is problematic given that the Governor of the MNB is also a member of the General Council of the ECB.

The Commission has doubts on the rules of dismissal for the Governor and the members of the Monetary Council which are prone to political interference (even the Parliament can propose to dismiss a member of the Monetary Council) and possible misuse …  [T]he frequent changes of the institutional framework of the MNB raise doubts … Moreover, a constitutional provision regulates the possible merger of the MNB with the financial supervisory authority. While the merger is not a problem as such, the MNB Governor would become a simple deputy chairman of the new structure, which would structurally encroach on his independence.”

Why the legislation is controversial in view of domestic political divisions: Apologists for the Hungarian government counter that ex-prime minister Ferenc Gyurcsány also threatened the independence of the Hungarian central bank – but that his acts did not result in a comparable uproar from the EU. It is true that the socialist government also tried to intervene in personnel matters at the Hungarian central bank and the monetary council. Hungarian economist George Kopits explains the substantial difference between the two cases here, as well as the kind of political interference Orbán is seeking to exercise on the central bank.

Why this is problematic for a democratic society: The legislation could open the way for the Hungarian government to use the currency reserves of the central bank to finance Hungary’s debt obligations. If the IMF declines to provide financial assistance to Hungary, and if Hungary can no longer finance itself from the markets (as is almost the case right now), Orbán and his cabinet might decide to draw on the central bank’s reserves for the 5 billion euros they are to roll over from Hungary’s debt this year. This would not be a novel strategy: reducing the sovereign debt from the central bank reserves has already been attempted in Argentina in 2001, where it quickly led to a sovereign default.

The Hungarian central bank currently uses 35-36 billion euros for stabilizing the Hungarian forint against other currencies. One of the reasons behind the 2008 economic crisis in Hungary was that the Hungarian National Bank did not have access to enough currency reserves (17 billion euros proved inadequate to prevent the crisis at that time). Since 2008, the central bank raised its currency reserves – in part from the loan provided by the IMF. Yet Viktor Orbán is known for making jokes or cryptic statements about a Hungarian default, or about the “mobilizing” of the “enormous monetary resources of” the central bank to pay off Hungarian debt.

THE NEW RETIREMENT AGE FOR JUDGES AND PROSECUTORS:

Why did the European Commission object to Hungarian laws: As of January 1, 274 Hungarian judges, prosecutors and public notaries aged 62 and above are being forced to retire. The Hungarian government created a new political entity called the National Judicial Office, with a president who is now solely responsible for making judicial appointments in their place. Once the appointments are made, the government will again raise the retirement age to 65. Critics of the government charge that this is merely a scheme to replace a significant portion of the Hungarian judges by government appointees. On these points, Hungarian law violates a principle already upheld by the European Court  in a September 2011 case against age discrimination. Yet the Hungarian government has already indicated that it does not intend to revise these measures.

In addition, the centralization of the judiciary under the president of the National Judicial Office raises concerns about the independence of the judiciary. She or he has exclusive power over the operational management of the courts, including human resources and budgetary decisions. He or she also has the right to allocate the judicial caseload among courts – i.e. to transfer cases from one court to another when this is deemed conducive to speeding up the judicial process.

Previously, the National Council of Judges used to fulfill many of the same functions now assigned to this office; since they were a self-governing collegial board, their governance of the judiciary contributed important safeguards against political interference with the judiciary. From now on, the National Council of Judges has no weight against the president of the National Judicial Office . There are additional concerns over the termination of the Chief Judge of Supreme Court (see below), and the fact that Supreme Court Justices are also among those who are being forced to retire.

Why the legislation is controversial in view of domestic political divisionsThe newly appointed president of the National Judicial Office is Tünde Handó, wife of József Szájer and long-time friend Viktor Orbán. Over the last two decades, newspapers have reported about their enduring friendship and the close ties maintained between the two families. When asked about appearances of impropriety, Ms. Handó said that she does not consider her personal friendship with the prime minister relevant.

Why this is problematic for a democratic society: Beside the obvious problem of making political appointees to judicial positions, Handó can interfere with the adjudication of specific cases by transferring them to court’s more likely to be amenable to political manipulation. Handó’s appointment keeps her in office for nine years.

(I am trying to keep this focused only to the most important aspects of the Hungarian government’s judicial reform. This document by the Hungarian Helsinki Committee, the Hungarian Civil Liberties Union and the Károly Eötvös Institute contains an in-depth analysis)

INDEPENDENCE OF THE DATA PROTECTION SUPERVISORY AUTHORITY

Why did the European Commission object to Hungarian laws: As of Jan. 1, 2012, the previous Parliamentary Commissioner for Data Protection is replaced by the National Agency for Data Protection. The rules of the new agency provide an opportunity for the prime minister and the president to dismiss the supervisor of the new administrative agency on arbitrary grounds.

Why the legislation is controversial in view of domestic political divisions: The previous ombudsman for data protection, András Jóri (and Supreme Court Chief Justice András Baka) were removed under questionable circumstances. Last month, the Hungarian parliament passed an amendment to the (new) Hungarian constitution which, among other things, also stated that the Hungarian Socialist Party bears responsibility for the historic sins of the Hungarian communist regime. The amendment laid down the conditions of the constitutional transition: while most parliamentary commissioners were able to continue in their mandate (even if the constitution changed the nature of their office), Jóri’s appointment was terminated on the day on which the new Hungarian constitution came into force.

Besides Jóri, only the Chief Judge of the Hungarian Supreme Court was terminated on account of the fact that Hungary introduced a new constitution. Baka was also disqualified from re-appointment into the position he otherwise would have held for another three years. As president of the “Curia,” the new name for the Supreme Court in the new Hungarian constitution, he would have had to serve as a judge in Hungary during the five years preceding the appointment. Baka would not have met these prerequisites: between 1991 and 2007, he was a judge at the European Court of Human Rights. He alone among his colleagues on the Supreme Court was hindered in a possible re-appointment by this prerequisite.

Why this is problematic for a democratic society: The ombudsman for data protection protects citizens from undue governmental access to information about them. In addition, Jóri and Baka’s case is a precautionary tale about what happens when members of the judiciary openly counter the government’s agenda. Both Jóri and Baka were critical of the government and sought the judicial review of legislation passed by Orbán’s government. Baka for example had challenged the modification of the Criminal Code at the Constitutional Court and spoke critically of the government’s transformation of the judiciary. Jóri also collided with the governing party on several occasions, for example regarding a secret database which Fidesz had illegally compiled from polling data on the political sympathies of individual voters (the Hungarian authorities never conducted an official probe into the problematic existence of this database).

********************************************************************************

As Viktor Orbán supposedly concedes to the European Commission’s demands, the fact that he downplays the importance of his government’s violation of EU law does not bode well for the proper resolution of these concerns. Last year, he also agreed to remedying technicalities in Hungary’s media law, yet those correction failed to resolve the problem of governmental restrictions on the freedom of the country’s press. Because what is being pointed out here are not technicalities. Each of the infringement proceedings currently under way are concerned with an issue that is symptomatic of the creation of an anti-democratic regime, and each of them, once considered in some detail, proves the severity of charges that Viktor Orbán’s government is drifting further and further away from the democratic values of the European Union. 

This entry was posted in András Baka, András Jóri, democracy watch, European Commission, European Parliament, Hungary, infringement proceedings, Viktor Orbán and tagged , . Bookmark the permalink.

7 Responses to EU Infringement Proceedings Against Hungary

  1. Excellent paper! you can also find the Letter to Viviane Reding here: http://www.newropeans-magazine.org/content/view/12709/50/lang,english/
    We also link for those who are interested in the Hungarian constitution different translations: English: http://www.newropeans-magazine.org/content/view/12727/50/lang,english/
    French: Faites vous une idée par vous-même sur la nouvelle Constitution Hongroise http://www.newropeans-magazine.org/content/view/12725/1/lang,english/
    German: Ungarische Verfassung: Machen Sie sich Ihr eigenes Bild http://www.newropeans-magazine.org/content/view/12726/1/lang,english/
    Thanks, Marianne

  2. woorry says:

    Very manipulative paper containing falsified facts. You protect democracy ? Please explain 400.000+ people taking part in the “Peace March for Hungary” organised by civil movements what you mean by ‘democratic values’ !

    Hungary has been a victim of western xenophobia. Since Dec 2011 organised lies are being spread in the press, including monopoly EURONEWS in over 10 languages, it is an economic war that has been pursued against Hungary to fail its state financing, just because Hungary is a minority in the EU and therefore became target of speculators…

    YOU JUST FORGOT ABOUT THE PEOPLE LIVING HERE

  3. Pingback: Trouble in Sajókaza: Being Buddhist and Roma | The Contrarian Hungarian

  4. Pingback: Trouble in Sajókaza: Being Buddhist and Roma « We go to the Sangha as our Refuge

  5. Pingback: Hungary-IMF Talks: Central Bank Law, Check? | The Contrarian Hungarian

  6. Pingback: Social Media and Politics « the Global Y

  7. Hi there! I see that is considerably off-topic nevertheless I was required to try to ask. Does doing a well-established blog prefer yours take a whole lot of perform? I’m fresh to successfully writing a blog nonetheless I actually do compose throughout my magazine on a regular basis. I’d love to go into a blog site so we could promote my expertise and thoughts online. You should move the post for people who have pretty much any referrals or even tricks for brand-new aiming writers. Thankyou!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s