Brussels set to approve Polish recovery plan

The European Commission will give its blessing to the Polish recovery fund in the coming two weeks, EU officials told POLITICO Tuesday.

Warsaw and Brussels have been locked into a lengthy dispute over the independence of the country’s judiciary, which has delayed the approval of Poland’s share of the bloc’s pandemic recovery fund, equivalent to €36 billion in grants and loans.

The EU set out three conditions for approval: Dismantling a controversial disciplinary chamber for judges; reforming the disciplinary regime; and reinstating dismissed judges.

Negotiators struck a deal on all three, the officials said, but disbursements would depend on Poland proving it has implemented the reforms.

Under the fund’s rules, money is paid out in instalments as countries demonstrate they have completed a list of so-called “milestones and targets,” or pre-agreed objectives.

“We are finalizing our work with Poland on milestones and targets on all three points,” a Commission spokesperson said.

After the EU executive formally endorses the plan, EU capitals would have four weeks to accept the Commission’s assessment by qualified majority. Poland’s minister for EU funds, Waldemar Buda, said Tuesday that Poland will apply for funds in July, Polish media reported.

Approval could also unblock EU endorsement of a global deal on a minimum corporate tax rate, which Poland has been blocking.

European officials and diplomats privately accuse Warsaw of holding the deal ransom until its recovery funds are released by Brussels. Poland disputes this claim, arguing there’s no link between the two. But officials hope that getting the recovery plan unstuck would also cause Warsaw’s veto on the global tax deal to drop.

Warsaw has also come under pressure from Washington to drop its opposition.

“The EU and the U.S. must show leadership by expeditiously implementing the global minimum tax in our domestic laws,” U.S. Treasury Secretary Janet Yellen said in Brussels today, after a visit to Warsaw on Monday during which she raised the issue.