EU faces triple whammy – no UK trade deal, no money, and 'disintegration'

Hungary & Poland form axis, present beleaguered EU with ultimatum in final Brexit days

© Brexit Facts4EU.Org 2020

EU’s “rule-of-law mechanism… may and would inevitably lead to the fragmentation of the European Union, and perhaps even the disintegration of the EU,” says Polish PM

As the UK-EU trade talks splutter on in London, the EU is entering crisis mode as two of its members reject Brussels’ demands and establish a Polish-Hungarian axis. There is no deal in sight on the EU’s new budget, set to start on the same day the UK finally exits the Transition Period. Nor is there any deal in sight for the proposed UK-EU trade deal.

Brexit Facts4EU.Org Summary

Today, Saturday 28 November 2020, the EU is faced with three serious problems

  1. What room for manoeuvre can Michel Barnier be given ahead of resumed trade talks today?
  2. What to do with two member countries jointly vetoing the EU’s 7-year budget/recovery package of €1.8tn?
  3. How can the EU force member states to accept EU-imposed laws they don’t want, without splitting the EU?

Lord Frost, Michel Barnier, the UK-EU trade talks, and the EU’s outrageous demands

Face-to-face UK-EU trade talks resume in London this morning. On Thursday we published a summary of Lord Frost’s letter to the EU in May of this year. In the headline we asked:

“How Lord Frost correctly slammed the EU and its ‘trade talks’
Why are we still even talking? A Brexit Facts4EU.Org analysis.”

The following day (yesterday) Lord Frost answered our question, using Twitter.

“Some people are asking me why we are still talking. My answer is that it's my job to do my utmost to see if the conditions for a deal exist. It is late, but a deal is still possible, and I will continue to talk until it's clear that it isn’t.”

“But for a deal to be possible it must fully respect UK sovereignty. That is not just a word - it has practical consequences. That includes: controlling our borders; deciding ourselves on a robust and principled subsidy control system; and controlling our fishing waters.

“We look to reach an agreement on this basis… because an agreement on any other basis is not possible.”

In the cases of the ‘level playing field’, ‘governance’, and fisheries, the EU’s demands have gone way beyond anything seen in any other trade deal the EU has signed – including the most recent one with Japan. As Lord Frost put it to the EU in his letter of 19 May 2020:-

© Brexit Facts4EU.Org 2020

Has the EU changed?

On Wednesday EU Commission President von der Leyen addressed the EU Parliament. She showed no signs that the EU has changed its unreasonable and unprecedented position to any meaningful extent.

“… there are still three issues that can make the difference between a deal and no deal. The crucial topics for the European side are of course questions linked to the level playing field, governance and fisheries.

“We are ready to be creative. But we are not ready to put into question the integrity of our Single Market – the main safeguard for European prosperity and wealth.…. In the discussions about state aid we still have serious issues, for instance when it comes to enforcement.”

“Concerning fisheries: No one questions the UK´s sovereignty on its own waters. But we ask for predictability and guarantees for our fishermen and women, who have been sailing in these waters for decades, if not centuries.”

On top of Brexit the EU now faces no new 7-year budget, no ‘rule of law’, and ‘disintegration’

In Budapest on Thursday, Hungarian Prime Minister Viktor Orbán and his Polish counterpart Mateusz Morawiecki held crisis talks about the EU’s latest moves to dictate national policies to its member states. After their meeting the two Prime Ministers released a robust joint statement, accusing the EU of trying to “undermine the Rule of Law within the Union by degrading it to a political instrument.”

They went on to criticise the EU’s proposed new policy as being one that “circumvents the Treaty, applies vague definitions and ambiguous terms without clear criteria on which sanctions can be based and contains no meaningful procedural guarantees.”

Time is now desperately short for the EU27 to agree the EU’s €1.8 trillion budget for 2021-2027, which includes its coronavirus recovery budget. All EU countries must agree in order for the budget to be approved, and Poland and Hungary have now stated they will act as one to block it, in a new Polish-Hungarian axis.

Polish-Hungarian axis is formed

"We have decided to align our positions on these issues.
Neither Poland, nor Hungary will accept any proposal that is deemed unacceptable by the other."

- Joint statement by Polish and Hungarian governments, 26 Nov 2020

The EU risks ‘disintegration’, says Poland’s Prime Minister

In a press conference after their meeting, the language from the two leaders was unequivocal.

Viktor Orbán: “Given that Hungary has disagreements with other member states on a range of fundamental issues like migration, the issue of national sovereignty, and gender, I can’t risk having positions forced on Hungary that the Hungarian people would disapprove of.”

Poland’s Prime Minister went even further, stating that there is a danger that the European Union’s “rule-of-law mechanism, due to its arbitrariness and… politically motivated decisions, may and would inevitably lead to the fragmentation of the European Union, and perhaps even the disintegration of the EU.”

Hungary will not be bought off, says PM Viktor Orbán

Hungarian PM Orbán added that journalists, lawyers and politicians who believed this was a financial matter were wrong. “This debate can’t be settled with money,” he said.

He argued that this was because the EU wanted to finance its coronavirus recovery fund by borrowing, and said that if another EU country failed to pay back its debt, Hungary would then be liable.

Right: Family man Viktor Orbán with his wife and five children

Hungary would suffer no financial loss if the EU failed to set up a recovery fund, Orbán went on, arguing that the fund was meant to help countries whose public debt exceed their gross domestic product. “Ours is way below this level,” he added.


Is the EU about to break up? No, but the discontent is now palpable and very public.

Poland and Hungary have each received large subsidies since they joined the EU, with Poland being by far the biggest recipient of the EU’s ‘Cohesion Fund’, financed in part by the UK taxpayer. Whilst this will reduce after the departure of the UK on 31 December 2020, it will still be a significant consideration.

Nonetheless, both countries’ economies have grown considerably since 2004 and it’s clear they are starting to exercise their muscle. The issue for them is not money, but the EU’s inexorable march towards a superstate, whose values they do not share.

As things stand, the EU will have no budget agreed for the next seven years and it now has the makings of a serious schism in its ranks which could lead to years of acrimony and a question mark over the future of the bloc itself.

And what about the UK-EU trade deal?

The events in Budapest on Thursday will not have been lost on Lord Frost, the UK’s Chief Negotiator for the troubled UK-EU trade talks.

This morning Michel Barnier, Lord Frost’s opposite number, is back in London. Quite why he has returned can only be speculated upon. Certainly the statements coming from the EU and its unelected Commission President Ursula von der Leyen have hardly shown any sign of a sudden attack of reasonableness in the last few days.

We continue to urge the UK Government to stand firm. There can be no trade deal based on the EU’s unreasonable demands, and in any event the Withdrawal Agreement must be rescinded and voided if the United Kingdom is to become a free, independent, and sovereign country on 01 Jan 2021.

Should a fudged deal be agreeed by Boris Johnson in the coming days or weeks, we will be reminding the PM of his Chief Negotiator's words yesterday:

"For a deal to be possible it must fully respect UK sovereignty. That is not just a word - it has practical consequences."

And it must be remembered that unless the Government rescinds and voids the Withdrawal Agreement, the UK has already given up its sovereignty.

And finally, COVID-19

The work of the Brexit Facts4EU.Org is being hit hard by the measures the Government has been taking to deal with Coronavirus. Donations to keep us going have fallen and we really need some of our many thousands of readers who have never donated to do so now, if possible. Quick, secure, and confidential donation links are below this article and we very much hope that you could take a couple of minutes to support us today. You will receive a warm 'thank you' email from a member of our team, but unlike some other Brexit organisations you will not receive future emails asking you to donate again. We respect your privacy.

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[ Sources: Hungarian Prime Minister's Office | EU Commission | EU Parliament | Lord Frost Twitter account ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Sat 28 Nov 2020

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