EU Court has dismissed claim by previous Hungarian government seeking to block revenue from frozen Russian assets intended to aid Ukraine
The Court of Justice of the European Union has dismissed a claim brought by the previous Hungarian government, which sought to block the transfer of proceeds from frozen Russian assets to Ukraine via the European Peace Fund.
This is reported by Euronews, according to Censor.NET
A lawsuit from the Orbán era
Last year, under Viktor Orbán’s previous government, Hungary appealed to the Court of Justice of the European Union, demanding that it annul the EU Council’s decision to channel interest income from the frozen assets of the Russian central bank to Ukraine via the European Peace Facility (EPF) — the EU’s main instrument for military aid.
The Orbán government claimed that the EPF had breached EU law by disregarding its veto on the grounds that Hungary was not a ‘contributing Member State’.
The statement of claim stated that the principles of equality between Member States and the democratic functioning of the EU had been breached, as a Member State had been deprived of its voting rights ‘without justification and without legal grounds’.
What was the court’s ruling?
In a press release, the court stated that it had dismissed the claim "on the grounds that it does not fall within the jurisdiction of the EU judicial system", concluding that the contested decision constituted a strategic choice within the framework of the bloc’s Common Foreign and Security Policy — an area that is largely shielded from judicial review.
Consequently, the court did not assess the legality of the mechanism for utilising income from the Russian Federation’s frozen assets on its merits, but dismissed the claim on the grounds of lack of jurisdiction.
Background
In 2021, the Council of the EU established the European Peace Fund to finance the European Union’s activities in the field of the Common Foreign and Security Policy.
On 21 May 2024, the Council of the EU adopted two decisions: the first approved rules for channelling extraordinary revenues from frozen Russian assets to support Ukraine, whilst the second set out the procedure for allocating these funds.
Hungary supported the first resolution, but when the second was adopted, it exercised what is known as a ‘constructive abstention’ — that is, it did not vote ‘in favour’, but neither did it prevent its adoption.
On 21 June 2024, the European Peace Fund Committee adopted a decision, by written procedure, to allocate the first tranche of these revenues to support the Armed Forces of Ukraine. The Committee ruled that Hungary was barred from participating in this vote due to its previous constructive abstention.
Following this, the Hungarian government at the time brought a case before the General Court of the EU, seeking to have the decision of the European Peace Fund Committee and the minutes recording its adoption set aside. Budapest argued that the procedure had breached voting rules, as well as the EU’s fundamental values and constitutional principles, in particular the rule of law, the equality of Member States and the democratic functioning of the European Union.
