Hungary submits anti-corruption package to unlock frozen EU funds

Hungary's new government filed a 110-page anti-corruption package with parliament on June 9 (24.hu). It is the first delivery from a conditional deal struck May 29 between Prime Minister Péter Magyar and Commission President von der Leyen. The deal requires Hungary to hit 27 reform milestones to unlock €16.4 billion frozen from the Recovery and Resilience Facility (RRF), the EU's post-pandemic investment fund. The hard deadline is August 31, after which unspent RRF money vanishes. The Commission, though, has a record of releasing money once governments pass laws, without checking those laws produce real change.

What the bill covers, and what it avoids

The package centres on Hungary's Integrity Authority, an EU-mandated anti-corruption watchdog. It gives the Authority power to override prosecutors who sit on corruption cases and to suspend suspect procurement contracts (DW). The bill also begins unwinding the Orbán-era public trusts that channelled universities and state assets onto politically appointed boards.

Absent from the 110 pages: judicial independence reforms, prosecutorial autonomy, and media freedom protections, all flagged in the EU's original conditionality requirements. On the day the package was filed, prosecutors charged the Integrity Authority's own chairman, Biró Ferenc, with embezzlement causing roughly €350,000 in damages. The timing undercuts the very institution the legislation is designed to empower.

The Commission keeps paying before checking

In 2024, the Commission released Poland's frozen billions after Donald Tusk's election, before judicial reforms passed. President Nawrocki later vetoed those reforms. In December 2023, the Commission unfroze €10.2 billion for Orbán's Hungary days before a Ukraine accession vote Budapest had threatened to block.

Advocate General Ćapeta (the top legal advisor to the EU's highest court) later concluded that the Commission should never have released those 2023 funds because rule-of-law conditions were not genuinely met. Her opinion in Case C-225/24, filed by the European Parliament to annul the decision, proposes a binding standard: the Commission must demonstrate effective implementation before disbursing. The Court of Justice has not yet ruled. If it follows the AG's reasoning, every future conditionality release would face a judicial test of real-world impact. A judgment is expected in late 2026.

Germany illustrates the fracture inside the Council (where member-state governments negotiate EU decisions). Chancellor Merz publicly praised Magyar's "fresh start". But Berlin also belongs to a group of six member states, alongside Sweden, Austria, Finland, the Netherlands, and Estonia, that has pushed for strict conditionality enforcement. Germany is caught between this fiscal-hawk alliance and its political relief at Orbán's exit. German legal commentators have warned the Commission risks repeating the Poland pattern.

Where oversight disappears

Approximately €3.5 billion in RRF funds will flow as block capital into Hungary's state development bank (MFB), which then on-lends to businesses and housing projects. Commission officials warned in May that this routing would "significantly reduce the Commission's oversight of spending." Once money enters MFB, Brussels loses per-project verification and must rely on Hungarian audit structures built under Orbán.

To clear all milestones by the deadline, Tisza (Magyar's party) proposed raising the cap on fast-track parliamentary procedures from six to fifteen per half-year. Tisza holds roughly 71% of parliamentary seats and needs no opposition support. These are the same emergency instruments Orbán used to push through constitutional changes.

The Commission has not published which milestones it considers already met. According to the FAZ, nobody in Brussels could specify the exact count. A further €530 million remains frozen over LGBTQ+ and asylum disputes outside the May 29 deal. Slovakia, currently dismantling its own anti-corruption bodies while Hungary builds new ones, poses the sharpest test of the system: whether the EU can distinguish between countries heading in opposite directions, or whether conditionality remains a political gesture in legal clothing.