Hungary and Poland: ‘Bargaining’ for EU structural funding in an age of rule-of-law budget conditionalities

In a hitherto unprecedented fashion, EU structural funds have been withheld from Hungary and Poland. This article traces how the two states 'got here' despite years of seeming inaction from the EU, and outlines the various types of 'bargaining' strategies that Hungary and Poland have invoked to try to obtain the disbursement of the frozen EU funds since 2022. Going beyond the existing literature on the rule-of-law budget conditionalities, which either offer legal rationales for the process or descriptive accounts, this article builds on EU bargaining theory to explain the larger, interconnected nature of this novel bargaining constellation. To gather evidence, the collection and systematization of approximately twenty semi-structured interviews with Hungarian and Polish experts, journalists and representatives of the government, alongside representatives of the European Commission was undertaken. The preliminary findings are manifold: the two states rely on a plethora of seemingly contradictory bargaining tools that exhibit both cooperative and distributive bargaining patterns. Moreover, despite the high salience of obtaining these funds, the two states have resorted to downplaying and stalling the negotiations, prioritizing appeals to their electorates over obtaining the funds. The EU’s current rule-of-law budget conditionality toolbox, as a form of sanctioning backsliding states, may be incomplete, as the states engage in issue de-linkage, meaning they pick and choose to fulfil certain conditionality requirements over others, in order to strive to obtain at least partial funding.