EU Court Overrules Approval of Hungarian-Russian Nuclear Deal

The European Union's highest court has overturned a prior decision by the European Commission to approve Hungarian state aid for the expansion of its Paks nuclear plant, executed by a Russian company. This ruling comes after the court found the Commission failed to determine whether the contract adhered to EU procurement rules.

Hungary had directly awarded the construction contract for the nuclear plant's expansion to Nizhny Novgorod Engineering, as part of a peaceful nuclear energy agreement between Russia and Hungary. In exchange, Russia granted Hungary a state loan to fund the majority of the new reactor developments, a plan which the European Commission had approved in 2017.

In 2018, Austria filed a complaint with the EU's General Court challenging the state aid involved in the deal but lost. However, an appeal to the EU's Court of Justice found merit in Austria's argument, determining that the Commission should have scrutinized whether the contract award was compatible with EU rules.

(With inputs from agencies.)