American Marconi Wireless News - Europe to cut funds for Poland over unpaid fine

The EU executive has informed Poland of its decision, which will be carried out next week, a commission spokesman, Balazs Ujvari, told AFP.

Polish government spokesman Piotr Muller said Warsaw would use "all possible legal means to appeal against this," Poland's PAP news agency reported.

The cut will amount to nearly 15 million euros ($17 million) for the period between September 20 and October 19 last year. The total unpaid fine amounts to around 70 million euros including interest, according to an AFP calculation.

The Court of Justice of the EU (CJEU) hit Poland with the 500,000-euro a day fine last September for refusing to comply with an order to close its Turow mine producing lignite, or brown coal.

Poland's neighbours, the Czech Republic and Germany, had complained of environmental damage the mine caused, affecting groundwater levels and creating dust and noise.

Last week, Poland signed a deal with the Czech Republic to end the dispute over the mine, which was confirmed by the court on Tuesday.

But that did not erase the CJEU fine, which Warsaw has insisted it will not pay.

- 'No legal basis' -

"From the very beginning, Poland has emphasised that the decisions taken by the CJEU had no legal or factual basis," Muller said.

"They go beyond the EU treaties and violate the treaty guarantees of energy security."

But the EU justice commissioner, Didier Reynders, insisted that the European Commission -- the Brussels executive and guardian of the EU treaties -- must be seen to uphold the decisions of the court.

"If the member state does not pay, it is obvious that we must organise, as we have said from the start, the withholding of funds," he told AFP.

"If we don't do this, no one would pay their fines anymore, obviously," he said.

Ujvari said the levied amount covering the period September 20 to October 19 would be recovered from Poland's EU funding. That comes to 14.5 million euros plus interest, which takes it close to a total of 15 million euros.

By tapping Poland's EU funding, he said, "the commission fulfils its legal obligation to collect financial penalties imposed by the court".

- Another fine -

Poland has been hit with another CJEU fine, of one million euros per day, for refusing to suspend a national Supreme Court chamber contested by Brussels.

There, too, the commission has warned it will recover the fine amount -- currently over 100 million euros -- from Poland's EU funding if it goes unpaid.

Poland's president, Andrzej Duda, has proposed a law to scrap the Supreme Court chamber in hopes of drawing a line under the dispute, which views the body as undermining judicial independence and rolling back democratic norms.

But the changes still have to be approved by Polish lawmakers, and legal observers queried whether it was merely a rebranding exercise.

Under the proposal outlined by Duda, the "disciplinary chamber" would be replaced by a different body called the "Chamber of Professional Responsibility" with 11 judges.

Poland's populist government insists reforms are needed for the judiciary to root out corruption and the legacy of judges appointed while the country was still under communist rule.

On the Turow mine deal with the Czech Republic, Poland has agreed to pay the Czechs 45 million euros in compensation in return for Prague withdrawing its complaint.

The European Court of Justice tweeted on Tuesday to confirm it had closed the case "following an amicable agreement between the Czech Republic and Poland".

Poland is reluctant to close the mine as it feeds a power station that provides around seven percent of the country's electricity needs.

Poland relies on coal to meet up to 80 percent of its energy, but has vowed to develop green energy sources and to shut its last mine by 2049, in line with EU emissions targets.

G.Stevens--AMWN