Just weeks before Hungary’s parliamentary election, a major—and potentially very costly—chapter in the rule-of-law dispute is returning to the forefront: the possibility of overturning the European Commission’s decision to unblock around €10.2 billion in EU funds for Hungary. The Court’s Advocate General, Tamara Ćapeta, has indicated that the Commission made an error when it concluded in December 2023 that Budapest had met key conditions related to judicial independence. If the judges of the Court of Justice of the European Union (CJEU) follow that reasoning, the Commission’s decision could be annulled—opening the door to demands that Hungary repay the money or have the amount offset against future EU disbursements.

What the dispute is about

The case concerns EU funds released under the framework of the “Common Provisions Regulation” and a horizontal enabling condition: compliance with the EU Charter of Fundamental Rights, including requirements connected to the independence of the judiciary. In 2022, the Commission approved Hungary’s operational programmes but withheld payments until specific conditions were met.

In December 2023, the Commission decided that the requirements concerning judicial independence had been satisfied and lifted the suspension—making roughly €10.2 billion accessible.

The European Parliament challenged that decision. In March 2024, it filed an action before the CJEU, arguing that the Commission misapplied its own criteria, committed manifest errors of assessment, and failed to provide adequate reasoning for why it considered the conditions fulfilled. In the political background, MEPs also suggested opportunism: the unfreezing of funds allegedly took place at a time when EU institutions needed Hungary’s cooperation on key decisions related to supporting Ukraine.

What the Advocate General said

An Advocate General’s opinion is not a judgment and does not formally bind the judges, but in practice it often serves as an influential guide in complex or novel cases.

Three points stand out in Ćapeta’s assessment.

First, she stresses a “conditions first, money second” logic. If the Commission itself set out detailed requirements for releasing funds, it cannot approve payments before the relevant reforms have actually entered into force and are effectively applied.

Second, she criticises what she describes as an overly narrow or incomplete evaluation of the reforms. In her view, the Commission did not conduct a proper assessment of issues such as the independence-related reforms concerning Hungary’s Supreme Court (Kúria), the rules for appointing members of the Constitutional Court, and barriers affecting the ability to refer questions to the CJEU—areas the Parliament says were not sufficiently examined. The opinion also points to the need to address legislative changes that could undermine the objectives of the reforms.

Third, she underlines shortcomings in transparency and reasoning. Given the scale of public money at stake—and the fact that payments were previously frozen over rule-of-law concerns—the Commission, she argues, owes an explanation not only to Hungary but to EU citizens more broadly.

At the same time, the Advocate General did not endorse the Parliament’s claim that the Commission abused its powers, considering that allegation insufficiently substantiated.

Why this is a problem for Orbán right now

The timing is politically sensitive. In an election campaign, the story can be framed as evidence that “Brussels” may return to a tougher line toward Budapest—and might even seek to claw back funds that were already unblocked. It also reopens a polarising debate about whether Hungary’s EU funding has become entangled in broader bargaining over issues such as Ukraine.

What could happen if the Court agrees with the opinion

A final judgment is expected months from now. Still, the potential scenarios are clear.

If the Court annuls the Commission’s December 2023 decision, the institutions will have to deal with the legal consequences of removing the act that unblocked the funds. That could translate into pressure on the Commission to demand repayment. If Hungary does not repay, one possible route—frequently discussed by legal and political observers—would be to reduce other payments to which Hungary would otherwise be entitled, effectively offsetting the amount.

Beyond the immediate financial impact, the ruling could have a broader precedential effect. The case is, in part, about the limits of the Commission’s discretion when it decides whether rule-of-law conditions have truly been met. A stricter interpretation would make it harder to “unfreeze” money on the basis of formal declarations or partial implementation and would require more robust proof that reforms work in practice.

A parallel front: the “sovereignty” law under fire

The wider context includes a separate, parallel legal battle over Hungary’s so-called “sovereignty protection” legislation. On the same day, reports highlighted another Advocate General opinion critical of those measures, arguing they conflict with EU law by restricting several fundamental freedoms. While final judgments will come later, the accumulation of such legal signals increases institutional pressure on Budapest.

Bottom line: trouble for Budapest, a dilemma for Brussels

For Viktor Orbán, the risk is straightforward: the issue of EU money returns to the centre of the campaign and may weaken the narrative of effective negotiations with Brussels. For the Commission, the situation is more paradoxical. If the Court ultimately overturns the 2023 decision, it would not only strain relations with Hungary but also raise questions about the Commission’s own standards of justification and transparency in decisions involving billions of euros in public funds.