BRUSSELS — Even after most member countries backed the EU’s landmark trade accord with Latin America, opponents of the deal in France, Poland and the European Parliament are still determined to derail or delay it. As a result, even after European Commission President Ursula von der Leyen flies to Paraguay this Saturday to sign the accord with the Mercosur bloc after over 25 years of talks, it could still take months before we finally find out when, or even whether, it will finally take effect. The culprit is the EU’s tortuous decision-making process: After the curtain came down on Friday on deliberations in the Council, the intergovernmental branch of the bloc, a new act will now play out in the European Parliament. Ratification by lawmakers later this year is the most likely outcome — but there will be high drama along the way. “It has become irrational,” said an EU diplomat, speaking on condition of anonymity. “If the European Parliament refuses, we will have a European crisis.” Proponents argue that the deal with Mercosur — which groups Argentina, Brazil, Paraguay and Uruguay — is the bloc’s best shot at rallying friends across the world as the EU tries to counter Donald Trump’s aggressive moves (the latest being the U.S. president’s threats to annex Greenland). But more than 140 lawmakers are already questioning the legal basis of the agreement, concerned that it breaches the EU treaties. They want it sent to the Court of Justice of the EU for a legal review, which could delay it for as long as two years. Political group leaders agreed before the Christmas break to submit this referral to a vote as soon as governments signed off on the deal. That vote is now expected at next week’s plenary, a official with the Parliament said.  Yet while the rebel MEPs have enough votes to call a floor debate, they likely lack the majority needed in the 720-seat Parliament to pass the resolution itself.  “I don’t think that the substance of the legal challenge is going anywhere. This is fabricated, it’s a lot of hot air — both in terms of environmental [and] health provisions, in terms of national parliaments. All of this has been tried and tested,” said David Kleimann, a senior trade expert at the ODI Europe think tank in Brussels. LEGAL ROADBLOCKS  The challenge in the Parliament is only one front. The deal’s biggest opponents, Poland and France, are also fighting back. Polish Agriculture Minister Stefan Krajewski said Friday he would push for the government to also submit a complaint to the Court of Justice.   “We will not let the deal go any further,” he said, adding that Poland would ask the court to assess whether the Mercosur pact is legally sound. On the same day, protesting farmers spilled manure in front of his house. “We will not let the deal go any further,” said Polish Agriculture Minister Stefan Krajewski. | Olivier Matthys/EPA Polish MEP Krzysztof Hetman, a member of the center-right European People’s Party and a political ally of Krajewski, said the referrals of the Parliament and of member states would play out separately with the same aim in mind. “If one succeeds, the other might not be necessary,” he said, adding that while the court considers the complaint, the deal would effectively be on ice. French President Emmanuel Macron, meanwhile, is under huge pressure from his political opponents to do more to stall the deal. France, Poland, Austria, Ireland and Hungary voted against the deal last week while Belgium abstained. That left the anti-Mercosur camp shy of the blocking minority needed to kill the deal. On Wednesday, the National Assembly will vote on two separate no-confidence motions submitted by the far-right National Rally and the far-left France Unbowed. Even if opposition to the Mercosur deal remains unanimous, the two motions have little to no chance of toppling the French government: The left is unlikely to back the National Rally text, while the center-left Socialists are withholding support for the France Unbowed motion. But nothing can be ruled out in France’s fragmented parliament.  REALITY CHECK Even some of the rebel MEPs admit their challenge is unlikely to succeed — and that the Parliament might still back the overall deal in a vote later this year.  “It will be very difficult now that the Council has approved it,” said Hetman, the Polish MEP. “The supporters of the agreement know this, which is why they sabotaged the vote on the referral in November and December.” Others opponents still see a chance to topple it, and are optimistic that the legal challenge can gather enough support.  “We want to delay the Mercosur adoption process as long as possible,” Manon Aubry, co-chair of The Left group, told POLITICO before the Christmas break. She also saw signs that a majority of MEPs could come out against the deal: “I bet there are even more MEPs willing to make sure that the agreement is fully in line with the treaties.” If the judicial review is rejected, the Parliament would hold a yes-no vote to ratify the trade agreement, without being able to modify its terms.  Such a vote could be scheduled in the May plenary at the earliest, Bernd Lange, the chair of the chamber’s trade committee, told POLITICO. Lange, a German Social Democrat, said he was confident of a “sufficient” majority to pass the deal.  Pedro López de Pablo, a spokesperson for the EPP — von der Leyen’s own political family and the EU’s largest party — vowed there was a majority for the agreement in the EPP and dismissed the legal maneuvering.  “It is clear that such a move is politically motivated to delay the implementation of the deal rather than the product of a legal analysis,” he said.  Giorgio Leali contributed to this report. 

Josep Borrell Fontelles is the former EU high representative for foreign affairs and security policy. Guy Verhofstadt is a former prime minister of Belgium and president European Movement International. Domènec Ruiz Devesa is a former MEP and president of the Union of European Federalists. It’s become tradition for pro-Europeans to chart their political course from Ventotene, where Altiero Spinelli wrote the manifesto “For a Free and United Europe.” Recalling that spirit has never been more urgent than it is now. Our union appears dangerously fragmented and weak, stuck in a hostile internal and external environment. Home to just 5 percent of the global population and a widening economic gap with other major powers, Europe isn’t just facing up to a world of continental empires but is at real risk of becoming America’s vassal. This became apparent after the nonreciprocal concessions made to U.S. President Donald Trump on defense spending and trade, as well as Europe’s acceptance of a junior role in handling the war in Ukraine. Moreover, from Gaza to Nagorno-Karabakh, the EU’s involvement in conflicts abroad has become largely irrelevant, either due to its lack of credible international standing or unity. Domestically, European Commission President Ursula von der Leyen’s second term has been counterintuitively marked by the undoing of the Green Deal — the flagship project of her first term — as if climate change isn’t getting worse. The Commission has also proposed an underwhelming Multiannual Financial Framework with no real increase, thus sacrificing cohesion policy to new priorities in defense products and research. Meanwhile, the Euroskeptic and Europhobic populist far right has never been stronger in member countries or EU institutions. The current EU chiefs suffer from a lack of long-term political vision, leadership and unity. For now, an unlikely alliance of Trump sympathizers and nostalgic Atlanticists appear to be dominating both the European Council and the Commission. Thus, the prevailing line has been to flatter and appease the U.S. president in the hopes of damage control, in turn fostering our political, strategic and even economic dependency on Washington — and it’s hardly working. For Trump, contracts only bind the other party — not him. And far from avoiding punitive tariffs or strengthening his support for Ukraine, agreeing to spend 5 percent of GDP on defense and buy more U.S. weapons and natural gas hasn’t even increased his commitment to collective security. Instead, from minerals deals to weapons sales, this has largely become a purely transactional affair based on advancing U.S. economic gains — and luck. Paradoxically, the lack of serious engagement from Russian President Vladimir Putin in starting a negotiated settlement is preventing Trump’s attempted delivery of a deal on Moscow’s terms. Pool photo by Sergey Bobylev/Sputnik/Kremlin via EPA It should be clear by now that Trump isn’t, and never will be, an ally. His America constitutes a huge geopolitical, economic and cultural shock to Europe. But becoming a U.S. protectorate isn’t inevitable — especially given increasingly indignant public opinion over the series of concessions and humiliations we’re witnessing. There is an alternate path. A reinvigoration of a pro-European majority in the bloc’s three institutions — particularly the European Parliament — could still lead to the self-determination of our destiny. The Parliament has the constitutional role of controlling the Commission and could call for a new direction, as it holds the power to censure it. For a start, the Parliament could block the reduction of tariffs on U.S. products — a move that would surely be popular with voters and would signal that Europe’s readiness to stand up to blackmail. Furthermore, we need to strengthen our political union, overcome the veto-cracy that allows Hungarian Prime Minister Viktor Orbàn to block the EU’s military assistance to Ukraine, and build our own defense system — one that isn’t reliant on the U.S. and can instill fear in the Kremlin. Once again, these decisions will be quite popular with most EU citizens. As former European Central Bank President Mario Draghi said, we won’t be a geopolitical power just by relaunching our internal market and competitiveness agenda. We need to become a federal union that isn’t constrained by unanimity requirements or a lack of proper competencies in foreign and security policy. Leading member countries should immediately take the initiative to start activating its common defense clause and reform the Treaties in alliance with the Parliament, which holds the power to veto the budget. Otherwise, a coalition of the willing should launch a new “European Defense Community” with a parliamentary and fiscal dimension, and is open to all member countries interested in joining. If no action is taken, and we wait for the next crisis to improvise on hard decisions, Europe as a political project risks dying.

BRUSSELS ― The European Commission is devising a scheme to transfer almost €200 billion in Russian immobilized assets to rebuild Ukraine at the end of the war. Brussels is testing the appetite of national capitals for moving the assets into riskier investments that could generate more profits for Ukraine and amp up pressure on Russia as it refuses to stop the fighting, several officials told POLITICO. Supporters also see the scheme as a step toward potentially seizing the assets and handing them over to Ukraine as a punishment for Russia’s refusal to pay post-war compensation. “We are advancing the work on the Russian frozen assets to contribute to Ukraine’s defense and reconstruction,” the Commission President Ursula von der Leyen said on Thursday, in her strongest remarks so far on the subject. Crucially, this option would fall short of immediately confiscating the assets, which a majority of EU countries oppose due to financial and legal concerns. Talks will come to a head on Saturday when the EU’s 27 foreign ministers debate the option for the first time during an informal gathering in Copenhagen, Denmark. During the discussion, ministers should look at “further options for the use of revenues stemming from Russian immobilized sovereign assets,” according to a preparatory note seen by POLITICO. With Ukraine facing an estimated €8 billion budget shortfall in 2026, EU countries are looking for new ideas to continue funding the war-battered country amid squeezed domestic budgets and no room to issue EU-wide debt. Despite its economic predicament, Europe faces increased pressure to step up in the face of U.S. disengagement from Ukraine and faltering attempts by President Donald Trump to reach a peace deal. “We hear that it’s more difficult to raise money [from national finances or the EU budget],” said Kerli Veski, the undersecretary for legal and consular affairs at the Estonian foreign ministry. “[But] we have those assets there and the logical question is how can we and why don’t we use those assets.” THE CONFISCATION CAMP Baltic countries bordering Russia and several others have long been pushing on the EU to confiscate the assets altogether. Within the Commission, Latvian Economy Commissioner Valdis Dombrovskis and Estonian Foreign Policy Chief Kaja Kallas have been advancing this idea. Within the Commission, Estonian Foreign Policy Chief Kaja Kallas has been advancing this idea. | Jonathan Raa/NurPhoto via Getty Images But this option continues to be met with resistance from Western European countries, including Germany, Italy and Belgium. The latter is particularly exposed to the legal and financial risks because it hosts Euroclear, the financial institution that holds the bulk of the Russian assets.   As a compromise, G7 countries in 2024 agreed to funnel a total of €45 billion in profits generated by investing the assets to Ukraine, while leaving the underlying assets untouched. Nevertheless, the EU’s €18 billion share of the loan will be entirely paid out by the end of the year ― prompting calls to generate additional revenues within a short timeframe. As a workaround, the Commission’s lawyers are looking into transferring the assets into a “special purpose vehicle” backed by a number of EU and potentially foreign countries. Officials compared the mooted new fund to the European Stability Mechanism (ESM), a money pot to bail out countries that is only backed by eurozone members and was set up outside the EU treaties. The potential fund for Ukraine would also be open to G7 countries, including the U.K. and Canada, that are in favor of confiscating the assets, said an EU official, although the details are still being hammered out. Overall, this new structure would give the EU greater control to hand over the assets to Ukraine when the time is right. Under the current rules, a single country can effectively hand the assets back to Moscow by vetoing the renewal of sanctions, which comes up for a vote every six months. Hungary’s pro-Russia and pro-Trump government is seen as the likeliest to take this course. Shifting the funds to a new body with potentially no unanimity requirements would stave off Hungary’s threat. BUY LOW, SELL HIGH Transferring the assets into a new fund would also allow them to be placed in riskier investments capable of generating higher returns for Ukraine. That would be a change from the current rulebook, which compels Euroclear to invest the assets with the Belgian central bank, which offers the lowest risk-free rate of return available. Skeptics, including Euroclear CEO Valérie Urbain, worry, however, that EU taxpayers would have to bear the brunt of any losses resulting from the riskier operations. To share the legal and financial burden, Belgium wants other EU countries to assume liability for the assets under the Commission’s proposed plan. “Belgium is not alone here. We need to support and be taking part in mitigating that risk,” said Veski. “It’s not a question of letting Belgium deal with it [while] we watch from the sideline.” The Belgian government has recently warmed to the Commission’s plan, said an EU official and a senior non-Belgian diplomat, while countries farther away from Russia, such as Spain, are also backing the idea. Jacopo Barigazzi contributed reporting.

Listen on * Spotify * Apple Music * Amazon Music Just when we thought we could get a break for the summer, geopolitics had other plans. This week on EU Confidential, host Sarah Wheaton is joined by POLITICO colleagues Jordyn Dahl, Gabriel Gavin and Jan Cienski for a catch-up on what moved while the bubble was at the beach. From Alaska to the White House: Did anything real shift on Ukraine beyond choreography? We break down the EU-U.S. tariff framework and turn to Gaza — where Brussels is grasping for some sort of leverage — and how the politics split across capitals.

BERLIN — The European Commission’s plan to supercharge the continent’s defense industry through a new joint funding tool may violate EU treaties, according to a legal analysis by Germany’s parliament obtained by POLITICO. The confidential report, dated April 30, by the Bundestag’s legal analysts adds that the EU’s €150 billion Security Action For Europe loans-for-weapons regulation may also deliver limited economic value. “In the context of the establishment of SAFE, questions also arise concerning the compatibility of this instrument with the Union law prohibition on the use of EU funds for operational measures with military or defense implications,” the analysis states, referencing Article 41(2) of the Treaty on European Union. SAFE would offer long-term EU-backed loans — up to 45 years, with a 10-year grace period — to member states for defense procurement and industrial projects. It is being advanced under Article 122 of the EU treaties, typically used for economic emergencies. But the Bundestag report notes this legal workaround “is not universally accepted,” and warns that “even the financing of defense-related goods and services” could fall under the treaty ban — especially when “intended for Ukraine and not for EU member states.” SAFE was approved last month by member countries, including Germany. The parliamentary report is unlikely to have an impact on German government policy. The German defense ministry did not immediately reply to a request for comment. The report’s criticism goes beyond legal concerns. The authors, made up of legal and policy experts, raise doubts about SAFE’s economic impact, pointing to “estimated expenditure multipliers between 0.4 and 1.0” — lower than for other public investments like infrastructure or education. They caution that “a significant portion of the positive effects of increased defense spending may occur abroad, particularly in the USA,” depending on supplier location. SAFE’s design includes a “Buy European” clause allowing only 35 percent of the value of the weapons to come from manufacturers beyond the EU, Ukraine or European Free Trade Association countries. While intended to strengthen the European defense base, the report highlights internal EU divisions and risks to defense partners. “Member states have expressed differing views on whether countries such as Canada or the United Kingdom … should be allowed to participate on an equal footing,” it notes. “Turkey and Serbia … are not mentioned at all.” SAFE is open to EU and EFTA countries and Ukraine. EU applicants and countries, like the U.K., that have signed security pacts with the bloc can join common procurements. Canadian Prime Minister Mark Carney is in Brussels on Monday to sign a similar deal. However, as the U.K. is now finding out, it’s not clear what level of access third countries will have. The German legal service does not call for scrapping the initiative, but its tone suggests SAFE is far from settled policy. Its conclusion: “The macroeconomic and industrial policy effectiveness of such investments therefore depends strongly on their localization.”

BRUSSELS ― EU judges dealt the European Commission a stinging defeat — and transparency campaigners a major win. In a long-awaited ruling with huge political and legal implications, the EU’s General Court ruled against the Commission over its refusal to release text messages between Commission President Ursula von der Leyen and Pfizer CEO Albert Bourla at the height of Covid-19 vaccine negotiations in 2021. Here’s what you need to know. WHAT WAS PFIZERGATE ALL ABOUT? The Commission’s denial of a journalist’s request for access to documents breached the principle of good administration, enshrined in EU law, according to Wednesday’s General Court ruling. The case stems from an access to documents request filed in 2022 by New York Times journalist Matina Stevis-Gridneff, who asked to see communications — including text messages — between von der Leyen and Bourla, after their existence was revealed in an interview.  The Commission initially claimed the messages didn’t qualify as documents according to its internal rules due to their ephemeral nature, and that no such texts could be found in its archives. It maintained ambiguity over their existence, and at the same time denied their importance ― while never truly clarifying how it handled the request. That led to suspicions it simply didn’t really look for them ― despite rules that apply to EU administrations regarding transparency obligations, the court ruling said. “The Commission breached the principle of good administration by confining itself … to invoking the non-existence of the requested documents without providing any explanation as to why the requested documents could not be found,” the court said. WHY SHOULD WE CARE? It is a landmark legal decision ― as well as a political bombshell for von der Leyen herself. “Cases related to access to documents from European institutions are often highly political, because if the matter ends up before a judge, it’s usually because the Commission or another institution is stubbornly refusing to disclose information that could cause it political harm,” said Vincent Couronne, a researcher in European law at Paris-Saclay University. The ruling doesn’t just say the Commission got it wrong — it says it should have known better. The judges scolded the Commission for effectively demanding that the applicant prove the texts existed, which is an “impossible” standard for ordinary citizens. The ruling is also particularly damaging because of the profile of the players involved. Von der Leyen is the EU’s most powerful official and guardian of the EU treaties. Bourla is one of the most powerful pharma executives in the world. It’s the biggest contract the EU has ever signed, the European Court of Auditors said. And it’s critical for the Commission as a whole, which seems to have only reluctantly observed EU laws when it meant holding its own boss accountable.  Transparency advocates, who argue the Commission should set the standard for openness, not dodge it, claim a major victory. “This ruling is about more than transparency: it is about reinstating the institutional accountability the European Commission has been sorely lacking,” said Shari Hinds, policy lead on EU political integrity for NGO Transparency International. SO WHERE DOES THAT LEAVE DOING POLITICS BY WHATSAPP? The case underscores a major gray zone in EU transparency rules: Are text messages official documents? “Documents are any content, whatever its medium, concerning the policy of the European Union so from this point of view … it’s hard to argue that SMS messages are not documents,” Couronne said. “This ruling could encourage European elected representatives and civil servants to prefer oral exchanges to SMS. In today’s business communications ecosystem, the line between SMS, email, WhatsApp, Slack and the like has become very thin.” The court didn’t say every text is a public record. But it did confirm that messages can fall under transparency laws if they concern official business. It’s a warning shot to EU institutions and all those who try to influence them: Digital messages aren’t automatically off the books, and you can’t totally avoid scrutiny by using them. In practice, it remains to be seen how far one can access any texts. ARE THINGS GOING TO HEAT UP FOR VON DER LEYEN? Probably. Critics from across the spectrum — especially the Greens and far right — have long kept the issue alive. But now mainstream political heavyweights are chiming in, calling the ruling a major embarrassment for the Commission. Dutch MEP Raquel García Hermida-van der Walle from centrist group Renew branded the decision a “slam dunk for transparency.” Ultimately though, real EU power still lies in national capitals — and there’s very little uproar coming from them after the decision. WHERE DOES THE COMMISSION GO FROM HERE? The Commission will now likely have to reconsider the initial request for access, conduct proper searches and provide new legal reasoning if it fails to disclose those documents again. It will also have to pay the legal costs for the New York Times, judges ruled. The court noted that the Commission’s interpretation of what qualifies as a document — and for how long it must be kept — didn’t deprive anyone of their rights to request a document or on the Commission’s obligation to search for it. Internal practices may now come under scrutiny and the Commission might have to clarify its own rules internally. The Commission also has two months to decide if it appeals the Court’s ruling. SO, WILL WE EVER GET TO SEE THESE TEXT MESSAGES? Maybe — but don’t hold your breath. The ruling concedes that retrieving the messages might be difficult. Phones may have been changed. Data might be gone.  “When questioned on that point at the hearing, the Commission stated that it assumed that its president’s mobile phone had been replaced” since the New York Times brought the case, “as it was a mandatory rule for security reasons,” the ruling said. But pressure is mounting on the Commission to at least do proper searches now and provide a proper legal reasoning if it says again it can’t retrieve the documents. From its early statement on Wednesday morning after the ruling, it seems that the Commission is leaning towards providing new reasoning as to why it can’t fulfill its transparency obligations, saying it would “adopt a new decision providing a more detailed explanation.” There is another route though. The European Public Prosecutor’s Office is already conducting a criminal probe into vaccine procurement. That means investigators could, in theory, access telecom providers or app servers to retrieve deleted messages — depending on local data retention laws.

EU membership isn’t on the ballot in Canada’s crucial election later this month — but polling shows Canadians are intrigued by the idea of joining the bloc. As U.S. President Donald Trump upends the relationship with his northern neighbor via a blizzard of punitive tariffs and belligerent social media posts, Canadians are wondering if they should cozy up to new, more reliable allies. Enter Brussels. In a recent poll, a whopping 44 percent of Canadians said they supported the idea of EU membership, compared with only 34 percent who dismissed the idea. European Commission chief spokesperson Paula Pinho noted that Brussels was “honored with the results of such a poll,” but appeared to confirm that only European countries are eligible for membership, according to the bloc’s governing treaties. But while Canada joining the EU might sound far-fetched even to the Commission, the EU experts who unpacked the question for POLITICO said that while such a gambit would be unlikely to succeed … it’s not actually impossible. ‘CANADA WOULD CERTAINLY QUALIFY’ The case for Canada as the bloc’s 28th member seems to be based mainly on vibes, dude. Although separated by the Atlantic Ocean and thousands of kilometers, Canada and the EU share many common interests: strong economic ties, shared democratic values and, well, the splitting headache Donald Trump’s U.S. administration is causing. European Commission chief spokesperson Paula Pinho noted that Brussels was “honored with the results of such a poll,” but appeared to confirm that only European countries are eligible for membership, according to the bloc’s governing treaties. | Hans Lucas/AFP via Getty Images That begs the question — given Pinho pointed to terminology in Article 49 of the Treaty on the European Union that says “any European State … may apply to become a member of the Union” — is there anything beyond basic geography that makes a country European and could Canada qualify? And since you asked … “Being European is more of a state of mind,” Giselle Bosse, professor of EU external democracy support at Maastricht University, told POLITICO. “Legally and formally a European state is not actually defined and looking into the past, we’ve had European states that in a way are not limited to the European continent,” said Bosse, pointing out that EU countries have overseas territories in the Caribbean, Pacific and the Arctic. She called Canadians “special Europeans, in a way” for reasons including their belief in the welfare state, their political and legal systems being based on European models and many Canadians having continental ancestry. Frank Schimmelfennig, professor of European politics at ETH Zurich, had a similar take, elaborating on an ongoing discussion about what it means to be European beyond placement on a map of the world. “Canada would certainly qualify,” he said, as it is “in very many ways probably closer to those European values, institutions and policies than many of the current candidate countries.” Those candidate countries include Western Balkan countries as well as Ukraine and Moldova which are progressing well (if slowly) on the EU pathway, but also Turkey and Georgia, which have stalled due to democratic backsliding and concerns over the rule of law. While some of the Canadian vibes are good, any decision would, ultimately, belong to the European Commission and the bloc’s member countries. As a note of caution for any excitable europhiles in Ottawa, when the EU’s southern neighbor Morocco applied for membership in 1987, its application was declined on the grounds that it was not a European state. FRENCH FARMERS WOULDN’T LIKE IT Although some EU scholars have arguments about why Canada’s EU membership is possible, others threw cold water on the prospect. To begin with, Canadians would need to be deadly serious about their so-called Europeanness. So far, the poll responses may have been “an emotional move on the part of Canadians,” according to Bosse, the professor from Maastricht University. Prior to joining the EU in 2004, Central European countries continually framed their accession as a “return to Europe,” the place of their historical belonging. Canadians have not expressed similar sentiments — at least not for now. Ian Bond, deputy director at the Center for European Reform, believes “it would be extremely difficult to make the case that Canada is a European country” for several reasons. Even if it were to pass the test of so-called Europeanness, “practical economics” would get in the way, he said. “Canada would then have to put the customs border between itself and the U.S. and apply EU tariffs and regulations on imports from the U.S. … It would be incredibly economically destructive. It would outweigh any benefits that it might expect to get from the [EU] membership over many, many years,” Bond added. He said that allowing a new member into the bloc would require unanimity — and even referendums in some member countries, such as France. “How often have French farmers voted in favor of free trade with other parts of the world? … They are more likely to set things on fire in an effort to prevent it from happening,” he added. IT’S A LONG SHOT Finally, green-lighting Canada’s EU membership could frustrate some countries, such as Turkey, which have been queueing up for, literally, decades. New Prime Minister Mark Carney made his first foreign trip to France on March 17 to discuss building stronger economic, defense and commercial ties with French President Emmanuel Macron. | Daniel Dorko/AFP via Getty Images “I don’t think this is feasible in the short term, because of the procedures and the state of the union and enlargement,” said Bosse. Instead, what Canada could do is improve their economic partnership agreement with the EU, said Bond. And it seems Canadian authorities are already on that. New Prime Minister Mark Carney made his first foreign trip to France on March 17 to discuss building stronger economic, defense and commercial ties with French President Emmanuel Macron. But he may have also made a fatal error for any long-shot EU ambitions, when he called Canada the “most European of non-European countries.”  If Brussels was taking notes, that could backfire if Canada ever actually submits a membership application. Csongor Körömi contributed to this report.

Andrew Duff is a former member of the European Parliament and is a senior fellow at the European Policy Center. Luis Garicano is a former member of the European Parliament and a professor of public policy at the London School of Economics. U.S. President Donald Trump has undermined NATO, probably fatally. He’s treated the EU institutions with contempt and has stymied Ukraine’s efforts to assert its own sovereignty and territorial integrity. Amid this shifting geopolitical landscape, Europe desperately needs to react, rapidly and decisively, to ensure its future security. Unfortunately, Hungarian Prime Minister Viktor Orbán is determined to avoid such resolute action. Nursing a deep grudge against the EU, the Hungarian leader prides himself on disrespecting the bloc’s liberal democratic values and is cavalier about rule of law, failing to cooperate with his bloc partners. He openly opposes the EU’s external security policy and has become an apologist for Russian President Vladimir Putin’s invasion of neighboring Ukraine. The EU has few options to address this crisis. And while current mechanisms have so far proven inadequate, a fresh interpretation of existing treaty provisions might just offer a solution. Let’s be clear: Orbán’s obstructionism is nothing new, and the bloc has already been trying to work around him using ad hoc measures. The Hungarian leader is a deeply mistrusted member in the European Council, as is European Commissioner for Health and Animal Welfare Olivér Várhelyi. And earlier this month, the European Council took the unprecedented step of issuing a communiqué on Ukraine signed by 26 members, not 27. Moreover, Commission President Ursula von der Leyen has begun conducting business via select groups of trusted Commissioners rather than the whole college, building coalitions of the willing by excluding the unwilling. Still, the EU has so far been reluctant to exploit the provisions in its treaties that “as a last resort” provide for enhanced cooperation between groups of countries willing to integrate faster (Article 20, Treaty of the EU). But that last resort has now been reached, which means we can expect more policy initiatives of this type in the future. Such development of common foreign, security and defense policies will likely be led by an avant-garde group of politically willing and militarily capable member countries. And in this area, the treaties offer more permission than prohibition. For example, Orbán and his allies cannot prevent certain countries from integrating their armed forces (Article 42(6)), and non-EU members like Norway and the U.K. can also join the bloc’s joint arms procurement and military missions — with or without NATO. Here, Ukraine’s membership bid presents an early test case of the bloc’s resolve to outwit internal opposition: Joining the EU must be an essential part of any Ukrainian peace deal, and by abstaining in the European Council, Orbán has already allowed accession negotiations to begin. For swift progress, however, the EU would need to drop its procedural rules from 2020, which allow members to veto the opening and closing of each chapter in the enlargement process, and return to the original treaty that only permits national vetoes at the beginning and end of the process (Article 49). This is achievable. Unless a qualified majority in the Council calls a halt, a concerted initiative by von der Leyen, supported by European Council President António Costa and implemented by the Council of the EU presidencies of Poland and Denmark in 2025, could tear up the old rule book. Orbán and Slovakia’s Robert Fico would protest, of course, but their bluff must be called. Today, Viktor Orbán’s main ally is Robert Fico, and this mutual protection pact has paralyzed the EU. | Zuzana Gogova/Getty Images Even if all this comes to pass, though, these approaches offer only partial solutions, and they fail to address the fundamental problem: They work around Orbán rather than confronting him directly. We already know that next year’s negotiations on reforming the EU’s system of own resources and its multi-annual financial framework will get nowhere. And those with ambitions for the bloc’s evolution will be forced to invent new financing methods outside the EU budget. We need a much more decisive approach — and there’s where Article 7 comes in. Article 7 permits the European Council to “determine the existence of a serious and persistent breach” of the values of Article 2, with a view to depriving the offending country of voting rights in the Council. But the deployment of this sanction requires a unanimous vote among all other members, and Orbán has always been able to rely on other fellow national populists. Today, his main ally is Fico, and this mutual protection pact has paralyzed the EU. However, a more creative reading of Article 7 offers a path forward. The treaty specifies that sanctions require unanimity of all other member states — but what if two countries were to face proceedings simultaneously? The exact wording is as follows: “Acting by unanimity on a proposal by one third of the Member States or by the Commission and after obtaining the consent of the European Parliament, may determine the existence of a serious and persistent breach by a Member State of the values referred to in Article 2.” The unanimity is calculated excluding the state “in question.” The treaty wording refers to “the Member State in question” in the singular, and doesn’t explicitly address situations where multiple countries are simultaneously under scrutiny. However, this singular language doesn’t preclude concurrent proceedings against two countries, especially when their mutual protection pact effectively renders the article toothless. Moreover, distinguished legal scholars like Dimitry Kochenov, Laurent Pech and Kim Lane Scheppele have argued that if two countries (e.g., Hungary and Slovakia) are sanctioned in parallel, each of them is excluded from the vote on the other, thereby neutralizing their ability to veto one another’s punishment. The rationale for this approach is a teleological interpretation of the article in question, which is intended to uphold EU values. Thus, it shouldn’t be providing a shield for autocrats via mutual impunity. And such a reading — focused on purpose and effectiveness — would support interpreting Article 7(2) flexibly, so that rule-of-law violators can’t exploit the unanimity rule to escape accountability. It also aligns with the principle that treaty provisions shouldn’t be applied in a way that defeats their effectiveness. The strategy carries risks, of course, as Hungary and Slovakia would likely challenge this procedure before the Court of Justice of the European Union. However, the court has consistently supported the EU’s fundamental values in recent judgments, such as in the 2021 Hungary v. European Parliament case (C-650/18). This interpretation stays within the letter of the law, while addressing its exploitative loophole. It transforms Article 7 from a theoretical threat into a practical tool. And, crucially, it simply requires political courage — not treaty change. Europe now faces the greatest challenge since its formation. The continent’s peace, prosperity and core values depend on confronting those who would destroy it from within, and if the bloc fails to act decisively, it risks remaining caught between a dysfunctional confederation and the “ever closer union” it hopes to become. This proposed simultaneous suspension strategy offers a pathway forward. The legal tools to address this crisis exist — Europe just needs to use them, and meet the moment with creativity and courage.

German Vice Chancellor Robert Habeck warned conservative opposition leader Friedrich Merz against striking a migration deal with the far-right Alternative for Germany (AfD).  “Don’t do it, Mr. Merz,” Habeck urged in an Instagram reel posted Tuesday night, calling such a pact a “turning point” in German politics and warning that aligning with the AfD on hard-line migration policies would “destroy Europe.” Migration politics have roiled Germany ahead of a vital snap election on Feb. 23 in which the Christian Democratic Union (CDU), Germany’s main center-right party, is currently forecast to come out on top, putting Merz on a glide path to the chancellery. The latest controversy comes as the CDU prepares to push a migration bill through the Bundestag on Friday. Due to the fall of Olaf Scholz’s coalition in November, the chancellor’s Social Democrats (SPD) and Greens are in a minority government, prompting opposition parties like the CDU to collect votes for their own legislative proposals. The migration legislation, backed by the AfD, would impose stricter border controls, expand federal deportation centers and allow indefinite detention of rejected asylum-seekers. Those are measures reminiscent of Hungary’s nationalist policies, Habeck said in his Instagram post.  With Scholz’s Social Democrats and Habeck’s Greens blocking the bill, the CDU is seeking support from other opposition parties, including the far right, breaking a long-standing political taboo against cooperating with the AfD. The CDU’s willingness to pass legislation with far-right backing signals a broader European shift, as center-right parties across the continent face mounting pressure to adopt a tougher posture on migration.  AfD deputy parliamentary leader Beatrix von Storch celebrated the conservatives’ shift. “The CDU has now realized that this might actually be the right approach,” she said on POLITICO’s Berlin Playbook podcast on Wednesday. “And that’s exactly why we are looking forward to this vote.” Habeck, a leading Green Party figure and its candidate to be Germany’s next chancellor, has proposed an alternative: An eight-point plan focusing on stricter enforcement of EU asylum rules than currently implemented and expanding security measures.

BRUSSELS — A battle is brewing between Europe’s most powerful nations and the European Central Bank (ECB) over control of a new monetary tool that both sides fear could destabilize the continent’s banking system if mismanaged. At the heart of the conflict lies the digital euro — a virtual counterpart to euro coins and banknotes. For years, the ECB has been developing the instrument, envisaging a pan-European payment challenger with the ability to rival United States heavyweights like Visa and Mastercard. But as the project nears reality, a tug-of-war has erupted. Several European Union governments, including France and Germany, argue the ECB has gained too much control over one crucial aspect: how much digital currency citizens will be allowed to hold in “wallets” backed by the central bank. While it may seem like a dry technical issue, the stakes are enormous. Politicians and technocrats worry that if the limit is set too high, citizens could pull vast sums from traditional banks during a crisis, jeopardizing the stability of the entire banking system. Some are also concerned that any cap could infringe on personal financial freedom, stoking fears of a “Big Brother” state, according to one diplomat, who like others mentioned in this piece was granted anonymity to speak freely about a sensitive issue. The struggle is raising a fundamental question: Where does the central bank’s authority end and that of EU member countries begin? Thirty years after the ECB became the bloc’s chief monetary guardian, the clash is forcing a reassessment of the delicate balance between politics and central banking. For some, it’s a necessary pushback against the ECB’s overreach. But in Frankfurt, officials view it as political meddling in a realm that should be free of it. At its core, as one diplomat candidly put it, the dispute is less about technicalities and more about a “battle for power.” TECHNOCRACY VS. DEMOCRACY  Over 100 central banks have explored the idea of creating a national digital currency, spurred into action after Facebook’s ill-fated attempt to launch a global cryptocurrency, Libra, in 2019 sent shockwaves through the financial world.  While many of these efforts have since fizzled out, the ECB has remained resolute, championing the digital euro as a game-changing alternative to existing payment systems — one it hopes will loosen Europe’s dependence on dominant U.S. and non-EU payment services, which currently handle around 70 percent of EU payments.  But the central bank’s relentless advance has also spooked key member countries, which now view the project as dangerously technocratic. In Brussels, they’re leveraging their political influence in an attempt to curb the Bank’s power in ongoing negotiations over crucial aspects of the digital euro’s design. Under the draft regulation being worked on by lawmakers and governments, the ECB alone would decide how much digital currency citizens can hold in their wallets.   Frankfurt sees this as consistent with its vision of the digital euro as an expression of European monetary sovereignty. Moreover, officials familiar with the discussions point out that the central bank is the only authority permitted to adjust the money supply. However, at least nine countries disagree. Before the summer, a group that included Germany, France and the Netherlands argued that Frankfurt’s exclusive monetary competence should not be used as an excuse to “limit their decision-making power,” according to notes from a meeting shared with POLITICO. Under the draft regulation being worked on by lawmakers and governments, the ECB alone would decide how much digital currency citizens can hold in their wallets. | Kirill Kudryavtsev/AFP via Getty Images Diplomats further asserted “political supremacy” over the matter, explaining the digital euro was not just a monetary tool but a broader financial services matter that could reshape how Europeans handle everyday payments. The EU’s treaty gives the ECB very strong legal privileges on regulating money supply, but only qualified ones over banking supervision and payments. It also explicitly allows the Council of the EU and European Parliament to “lay down the measures necessary for the use of the euro as the single currency” — albeit “without prejudice to the powers of the European Central Bank.” FINANCIAL STABILITY, HANDED DOWN FROM ON HIGH Some member countries are also deeply concerned about how their citizens will receive a project devised by technocrats they suspect as being out of touch.  “You can create something in an ivory tower,” said one Brussels-based executive familiar with the discussions. “But will it actually be used in a market?”  Another area of concern is that allowing the ECB to set the limit would leave the institution with exclusive influence over a new tool that could have outsized effects on banking stability. The ECB argues that ensuring the soundness of banks is a core part of its supervisory responsibilities, given that such institutions are the main conduit through which it conducts its monetary policy. Many member countries, however, are not convinced. They argue it is the legislature that defines many of those supervisory responsibilities. They also don’t trust the ECB to cut slack with banks they feel it is their patriotic duty to protect.  But Frankfurt, along with the European Commission, has warned that allowing governments to set the limit could expose the independent central bank to political pressure, according to two people familiar with the discussions. Another European official worried that politicians might cave to popular demands to raise the limit, hurting banks. Ironically, many bankers also now side with the ECB, after it rolled out a number of features designed to reduce the threat to their businesses.  Stephen Cecchetti, a professor at the Brandeis International Business School, agreed that the digital euro was primarily a payment system infrastructure, but said the holding limit should be decided by the same people deciding if EU citizens can use €500 notes: the ECB’s Governing Council.  These kind of complaints suggest that “politicians don’t like the fact that the technocrats in their countries took this role,” he said, adding if they have an issue with that “they should complain to their central banks.” But member countries haven’t given up. One possible compromise is to let legislators set the parameters within which the ECB operates but to give the Bank the final say. Even so, that might not do much to resolve the broader worry — that a project intended to save Europe from the overarching economic dominance of U.S. tech now threatens to become a risk in its own right, should the ECB forge ahead without adequate democratic support.