Hungary and Poland's court bid to stop EU cash handouts from being conditional on respect for rule of law "should be dismissed".
Budapest and Warsaw took their case to the European Court of Justice.
But, on Thursday, the court's advocate general issued an opinion arguing that their attempt should be thrown out.
The advice of the court precedes a full court decision, which is expected within the coming months.
Linking the disbursement of funds to democratic principles was a key part of the EU’s decision last year to push through a massive subsidy programme for the 27 member nations to overcome the unprecedented impact of the coronavirus pandemic.
Advocate General Manuel Campos Sanchez-Bordona advised the actions of Hungary and Poland “should be
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