European Commission Criticizes Hungary’s Public Interest Trust Regulations, Threatening Erasmus+ Funding
The European Commission has raised concerns about Hungary’s regulation of public interest trusts, specifically in relation to access to EU funds. The laws in question impact whether model universities can receive funding from programs like Erasmus+ and Horizon Europe, which were previously blocked due to conflict of interest issues.
According to the European Commission, one of the main issues with the Hungarian legislation is that it would only come into force if Member States revoked their previous decision, which goes against EU requirements. The legislation should be effective as soon as it is presented to address the substantive issues at hand. Additionally, the laws do not apply to all relevant institutions, as not all model-changing organizations are listed in the legislation’s annex. The EU believes that the rules should cover all relevant institutions and be enforced throughout the EU funding application process.
The European Commission also highlighted weaknesses in managing conflicts of interest within the Board of Trustees and the Supervisory Board. While Hungarian legislation mentions the importance of integrity, it lacks adequate safeguards for effective oversight and enforcement. The Commission expects individuals to submit declarations of conflicts of interest and assets before appointment and periodically during their tenure, extending to include relatives in the same household to prevent potential abuse.
Moreover, the EU pointed out a lack of independence in the control system for evaluating conflicts of interest and suitability. Assessments should be conducted by an independent body before appointments are made to ensure the suitability of individuals applying for EU funds. The Integrity Agency plays a significant role in this process, but the current regulations do not provide it with adequate access to necessary databases and information, hindering effective monitoring and accountability.
The EU also criticized the absence of a specific methodology for addressing breaches of conflict of interest rules, including disciplinary or criminal sanctions. As a result, the management of declarations and conflict of interest situations is considered insufficient.
Hungary now faces the task of addressing these shortcomings to unlock blocked EU funds, as the European Commission has chosen to maintain prohibitive measures until compliance with EU standards is achieved. It is essential for the Hungarian government to meet EU expectations and ensure complete adherence to regulations for the unfreezing of EU funds.
