The European Parliament adopted by 521 votes to 152, with 21 abstentions, a resolution on the establishment of an EU Mechanism on Democracy, the Rule of Law and Fundamental Rights.

Lack of tools to ensure respect for the Union's values

Members recalled that the last decade has been marked by blatant attacks on the Union's values. The rights of vulnerable groups, such as women, people with disabilities, Roma, LGBTI people and the elderly, as well as minority rights are still not fully respected in some Member States.

In the face of an unprecedented and growing crisis regarding its founding values, which threatens the long-term survival of the EU as a democratic peace project, Parliament expressed its deep concern about the rise and entrenchment of autocratic and illiberal tendencies, which are further aggravated by the COVID-19 pandemic and the economic recession, as well as corruption, disinformation and state capture in several Member States.

Parliament recalled that the criteria for accession to the Union required that any candidate country must have stable institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities, in accordance with the values enshrined in Article 2 of the Treaty on European Union. However, the Union does not have effective tools to ensure that these criteria are met once the state has become a member of the Union.

Members noted in this context that the Council's failure to apply Article 7 of the Treaty on European Union in practice opened the door to continued failure to respect the values of the European Union.

With a view to responding to the crisis of the Union's values and restoring mutual trust between Member States, the resolution therefore stressed the urgent need for the Union to develop a robust, comprehensive and positive agenda for effectively protecting and reinforcing democracy, the rule of law and fundamental rights for all its citizens. It insisted that the Union must remain a champion of freedom and justice in Europe and the world.

Creation of an EU mechanism

In order to address the lack of a comprehensive mechanism that can holistically look at the state of democracy, the rule of law, fundamental rights and all other Union values, while at the same time being mindful of the need to treat all Member States in the same way and based on transparent and clear criteria, Parliament proposed that the Commission, the Council and Parliament jointly set up a mechanism to monitor all Member States annually with respect to their adherence to Union values by entering into an interinstitutional agreement to that effect.

The proposed interinstitutional agreement aims at laying down arrangements that will promote and strengthen respect for Union values through coordination and cooperation between Parliament, Council and Commission. This shall entail:

An annual monitoring cycle

An annual monitoring cycle in all areas of the Union's values shall consist of a preparatory stage, the publication of an annual monitoring report on the Union's values, including specific recommendations for each Member State, and a follow-up stage.

A permanent inter-institutional working group, assisted by a group of independent experts working in cooperation with the European Union Agency for Fundamental Rights, shall facilitate coordination and cooperation between the three institutions in the annual monitoring cycle and regularly inform the public about its work.

The Annual Report shall describe both positive and negative developments in the field of the Union's values in the Member States. It shall be impartial, based on objectively collected evidence and respect equal treatment of all Member States.

No later than two months after the date of publication of the annual report, Parliament and the Council shall adopt positions on the annual report by means of resolutions and conclusions.

On the basis of the conclusions of the Annual Report, the Commission shall, on its own initiative or at the request of the European Parliament or the Council, enter into a dialogue with one or more Member States with a view to facilitating the implementation of the recommendations. It shall report to the European Parliament and the Council at regular intervals on the progress of the dialogue.

The three institutions shall also take into account the conclusions of the Annual Report when setting funding priorities and shall commit themselves to ensuring that the Annual Reports guide their actions relating to the values of the Union.

The Commission may, on its own initiative or at the request of the European Parliament or the Council, draw up an urgent report when the situation in one or more Member States gives reason to believe that there is imminent and serious damage to the values of the Union.

Consideration of complementarity with other instruments

The proposed draft Interinstitutional Agreement also takes into account the mechanisms and procedures for the protection and promotion of Union values, in particular the procedure under Article 7 TEU, infringement procedures and the draft Regulation on the protection of the Union budget in the event of a general breakdown in the rule of law in a Member State.

In order to avoid any overlap and to ensure that all measures taken against Member States are on the same basis, Parliament proposed that the annual report shall serve as a basis for the decision on whether or not to initiate the procedure under Article 7 TEU and for the assessment of the appropriateness of any other instrument, including budgetary cross-compliance.

Parliament reiterated its call to ensure that systemic violations of the values referred to in Article 2 of the Treaty on European Union are considered incompatible with EU funding. It also stressed the need, in order to protect the EU budget, to use reverse qualified majority voting, without which the effectiveness of the new budgetary conditionality mechanism would be undermined.