The EU Council has approved the European Commission’s proposal to end the rule-of-law procedure against Hungary, opening the way for EUR 4.2 billion in frozen funding and restoring access to Erasmus+ and Horizon Europe for foundation-run universities.

Hungary is set to regain access to EUR 4.2 billion (more than HUF 1,500 billion) in frozen EU funding after member states approved the closure of a long-running procedure over concerns about the rule of law and the protection of the bloc’s financial interests.

The decision also paves the way for universities run by public-interest asset management foundations to regain full access to EU programmes, including Erasmus+ student exchanges and Horizon Europe research projects. These institutions had been unable to enter into funding commitments under the programmes since restrictions were imposed in 2022.

“I warmly welcome the Council of the European Union’s decision to adopt our proposal. A new chapter starts today. For Hungary and for Europe,” European Commission President Ursula von der Leyen wrote on X on Tuesday.

The Commission had recommended ending the procedure in September, concluding that the Hungarian government had addressed the shortcomings that originally prompted the measures.

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Why was Hungary’s EU funding frozen?

The EU launched the conditionality procedure in 2022 after concerns about public procurement, corruption risks and the oversight of EU funds. The Council initially suspended 55% of commitments under three cohesion policy programmes, freezing EUR 6.3 billion.

The amount subsequently fell to EUR 4.2 billion after Hungary lost access to a further EUR 1 billion at the end of both 2024 and 2025, Telex writes. The Council’s latest decision means another loss of this kind at the end of 2026 is now highly unlikely.

The original concerns included the transparency of public procurement, conflicts of interest, the effectiveness of anti-corruption measures and the prosecution of suspected offences affecting the EU budget.

According to the European Commission’s assessment, Hungary has since strengthened the powers of its Integrity Authority, introduced a comprehensive asset declaration system, improved transparency around public-interest asset management foundations and addressed conflicts of interest involving them. Judicial review of prosecutorial and investigative decisions has also been expanded, while oversight of EU funding and procurement transparency have been strengthened.

The Council approved the Commission’s proposal by a qualified majority, ending the procedure because the conditions for continuing it were no longer considered to be present.

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Erasmus+ and Horizon Europe: what changes for universities?

The dispute had particularly serious consequences for Hungarian universities that transferred their operations to public-interest asset management foundations, known in Hungary as közfeladatot ellátó közérdekű vagyonkezelő alapítványok, or KEKVA.

Under the 2022 decision, these foundations and the institutions they maintained were barred from entering into new EU funding commitments. Although the universities were not formally excluded from Erasmus+ or Horizon Europe, the restrictions made participation in practice much more difficult.

For Erasmus+, the restrictions meant that students at affected universities could no longer take part in the programme through their institutions once existing agreements expired. By autumn 2024, none of the foundation-run universities could send students on Erasmus+ exchanges.

Details: Erasmus returns to Hungary – Hungarian university students can once again study abroad!

Horizon Europe faced a different problem. Universities could still participate in research collaborations, but they could not receive EU funding under the restrictions and did not count towards the minimum number of EU-based participants generally required for projects. Researchers at affected institutions reported financial losses and difficulties finding international partners.

The previous Hungarian government introduced domestic funding to help cover some research costs, but this did not remove the underlying restrictions.

Tisza MEP Viktor Weisz welcomed the Council’s decision, saying it opened the way to full access to Erasmus+ and Horizon Europe.

“Erasmus+ is not a privilege, but a right, an opportunity to learn, develop and discover Europe,” he said, adding that Hungarian young people should not have to pay the price for political decisions.

When could students return to Erasmus exchanges?

The end of the procedure removes a major obstacle, but it does not mean that student exchanges can resume immediately.

The autumn semester is already under way, and universities still need to make the necessary commitments following the Council’s decision. As a result, the spring semester is the earliest realistic opportunity for students at affected institutions to return to Erasmus+ exchanges.

At a European Commission press briefing on Wednesday, spokesperson Balázs Ujvári confirmed in response to a question from Hungarian broadcaster RTL that the universities would be able to enter into commitments once the Council had taken its decision.

The precise timing will depend on the arrangements made by the universities and their partners. The same decision could also help foundation-run universities participate more fully in ongoing Horizon Europe research projects, provided the necessary commitments can be concluded.

The EUR 4.2 billion will not arrive in one payment

Although the Council’s decision removes the conditionality-related barrier, Hungary will not receive the entire EUR 4.2 billion as a single transfer.

The funding comes from the EU’s 2021–2027 cohesion policy budget and is reimbursed against invoices for eligible developments that have already been carried out. Payments remain subject to the applicable programme rules and reimbursement procedures.