The European Union's top court has dismissed legal challenges by Poland and Hungary to the bloc's new instrument that enables it to cut or withhold funding to member nations if they are found to be failing to uphold the rule of law.
Populist governments in the two countries had challenged the tool, saying the 27-nation bloc lacked the legal authority to implement such a measure.
The decision is living evidence that Brussels is abusing its power."-- Hungarian Justice Minister Judit Varga
The European Court of Justice (ECJ) ruled that the mechanism "is intended to protect the [EU] budget from effects resulting...from breaches of the principles of the rule of law" and was thus allowed under EU treaties.
“The full court dismisses the action,” a statement read out by the judge on February 16 said.
The EU has been locked in a bitter battle with Poland and Hungary, criticizing the two countries for adopting measures that curb the rights of women, LGBT people, and migrants, and for stifling the freedom of courts, media, academics, and NGOs.
The ECJ said that when joining the bloc, member states sign up to respect its "common values...such as the rule of law and solidarity," and the European Union "must be able to defend those values.
The final ruling by the Luxembourg-based court cannot be appealed.
Both countries slammed the ruling, with Hungary calling it a "political decision," while Warsaw characterized it as an attack on Poland's sovereignty.
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"Poland needs to defend its democracy from blackmail that aims to take away our right to self-determination," Deputy Justice Minister Sebastian Kaleta said on Twitter.
"Today we need to stand together in the face of this attack on our sovereignty," Kaleta added.
Hungarian Justice Minister Judit Varga said in a Facebook post that the ruling is part of the EU's efforts to help the opposition unseat populist Prime Minister Viktor Orban's right-wing government in upcoming elections.
"The decision is living evidence that Brussels is abusing its power," he said.
Orban's Fidesz party faces a united opposition in the April 3 general elections that opinion polls show could threaten his hold on power for the first time since 2010.